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Financial Management System

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Title: Financial Management System


1
Financial Management System Agency
Requirements Outreach Briefing November 14 and
17, 2006
2
Agenda
  • Welcome and Introductions
  • Background / Purpose of Study
  • Project Governance
  • Preliminary Findings
  • Requirements Functional Scope
  • System Requirements Validation
  • Questions

3
FMS Needs Assessment Update Background
  • FMS Needs Assessment performed in 2001 by
    Accenture.
  • Overseen by steering committee made up of state
    agency representatives, including Judicial,
    Legislative branches
  • Recommended centralized system with two agency
    copies. Project costs estimated between 24.5M
    36.5M
  • Decision made not to move forward due to lack of
    funding related to economic downturn.
  • Began effort in April 2006 to revisit FMS needs
    in light of changes in administrative philosophy,
    business practices, changes in technology, and
    improved economic outlook
  • RFP opened in July 2006 for consulting services
    to assist in update. Awarded in late August to
    Salvaggio, Teal and Associates who have performed
    similar work in six states.

4
FMS Needs Assessment Update Purpose of Study
  • Update the system requirements for a new
    integrated FMS
  • Update the business case analysis associated with
    implementing a new FMS
  • Determine whether there is a compelling business
    case for procuring/implementing an integrated
    statewide FMS
  • Submit recommendations regarding
  • Organizational best practices
  • Implementation best practices

5
FMS Needs Assessment Update What is FMS?
Financial Management System (FMS) A
comprehensive suite of integrated modules
delivered by a single software vendor that
provides end-to-end support for statewide
administrative business functions (e.g.,
financial accounting, procurement, asset
management). FMS is a proposed solution that
provides functionality similar to STARS, SOKI,
Central Setoff System, and other agency
administrative systems, but in a fully integrated
manner.
6
FMS Needs Assessment Update Key Activities and
Timeline
Validate Functional / Technical Requirements
Project Start-Up
Validate the Business Case
Dec
Sept
Oct
Nov
Business Case Analysis Report
Updated Needs Assessment
Key Deliverables
Organization / Implementation Best Practices
7
Project Governance Organizational Structure
8
Project Governance Project Sponsors
  • Duane Goossen
  • Secretary of Administration
  • Carol Foreman
  • Deputy Secretary of Administration
  • Denise Moore
  • Executive Branch Chief Information Technology
    Officer

9
Project Governance Steering Committee
  • Chair - Carol Foreman, Deputy Secretary of
    Administration
  • Mary Blubaugh, Board of Nursing
  • Alan Conroy, Legislative Research Department
  • Gary Daniels, Department of Social
    Rehabilitation Services
  • Elaine Frisbie, Department of Administration
    Division of Budget
  • Kathy Greenlee, Department on Aging
  • Mike Hayden, Department of Wildlife and Parks
  • Lynn Jenkins, State Treasurer
  • Deb Miller, Department of Transportation
  • Reginald Robinson, Board of Regents
  • Howard Schwartz, Judicial Administrator
  • Joan Wagnon, Department of Revenue
  • Roger Werholz, Department of Corrections

10
Project Governance Stakeholder Agencies
  • Adjutant General
  • Department on Aging
  • Department of Agriculture
  • Department of Administration
  • Department of Health and Environment
  • Department of Transportation
  • Highway Patrol
  • Department of Labor
  • Department of Commerce
  • Juvenile Justice Authority
  • Department of Corrections
  • Department of Revenue
  • Social and Rehabilitation Services
  • Kansas Health Policy Authority
  • Judicial Branch
  • Department of Wildlife and Parks
  • State Treasurer





11
Preliminary Findings Lack of Integration
  • Financial Accounting (STARS, SOKI)
  • Purchasing (Procurement Manager Plus)
  • Asset Management (various agency systems)
  • Budget Development (BMS, various agency systems)
  • Accounts Receivable (various agency systems)





12
Preliminary Findings Functional Challenges
  • Procurement
  • Grant and Project Accounting
  • Fleet Management
  • Inventory Management
  • Time and effort reporting in SHARP
  • Agency operating budget vs. appropriation budget
  • Real-time budget checking





13
Preliminary Findings Functional Challenges
  • Agencies need ability to establish lower level of
    detail in chart of accounts
  • Robust ad hoc reporting
  • More efficient processing of employee travel
    authorizations and payment
  • Comprehensive accounts receivable functionality
    including Set-Off capabilities
  • Lack of enterprise Asset Management system for
    assets and controllable items





14
Preliminary Findings Other
  • A number of agencies are either ready to seek
    replacement financial management systems or
    acquire a new system
  • Evaluation of Chart of Accounts Needed
  • Financial Accounting Coding Structure
  • Budget Coding Structure
  • Procurement Commodity Code Structure
  • Difficult to obtain true data on statewide
    spend





15
FMS Needs Assessment Update Functional
Requirements Scope
  • PROCUREMENT/LOGISTICS
  • Purchasing
  • Inventory Management
  • Fleet Management
  • CORE FINANCIAL
  • General Ledger / Budgetary Control
  • Accounts Payable
  • Accounts Receivable Cash Receipting
  • Cash Management
  • Cost Allocation
  • Grant Accounting
  • Project Accounting
  • Asset Management
  • HR / PAYROLL
  • Automated Interfaces to/from SHARP

Common Database
  • BUDGET DEVELOPMENT INTEGRATION
  • Appropriation Budget
  • Agency Operating Budget

16
Accounts Payable
  • The Accounts Payable module will be used to
    process payments to vendors for goods and
    services. Major business functions included in
    this module are
  • Vendor maintenance
  • 3-way matching process
  • Payment processing
  • 1099 processing
  • Payment cancellation
  • Vendor self-service
  • Employee travel authorization and payment
    processing

17
Accounts Receivable
  • Accounts Receivable provides proper recording of
    revenue against all segments in the Chart of
    Accounts to enable the State to report and
    monitor actual revenue against budgeted revenue.
    This area addresses the following functions
  • Customer maintenance
  • Accounts receivable processing
  • Billing
  • Cash receipting
  • Dunning notices
  • Interest / penalty calculation

18
General Ledger Budgetary Control
  • The General Ledger Budgetary Control Module
    provides an integrated central repository of
    statewide financial data. All subsidiary
    functions (e.g., Accounts Payable) update the
    General Ledger with financial data. Budgetary
    Control is used to control spending to ensure
    that spending is in accordance with the
    Appropriations Bill. Major functions of this
    module include
  • Chart of Accounts Structure
  • Basic Fund Accounting
  • Corrective or Adjusting Journal Entries
  • Interfund/Interagency Transactions

19
General Ledger Budgetary Control
  • Month-End and Year-End Closing
  • State and Federal Reporting
  • Real-time Budgetary Control
  • Budget Maintenance and Monitoring
  • Budget Adjustments

20
Cash Management
  • Cash Management provides an integrated central
    repository of deposit transactions for
    reconciliation of the various state bank
    accounts. In addition, payments issued are
    tracked to validate against the redemption of
    these items
  • Issuance and redemption of payments
  • Bank reconciliation

21
Cost Allocation
  • Cost Allocation aids management in making
    cost-effective and informed decisions about
    projects and programs by assessing the entire
    monetary cost of resources used or committed to
    projects and programs. By providing financial
    allocation and distribution functionality, the
    FMS offers the ability to accumulate and measure
    the true cost of organizational activities.
  • Cost Allocation
  • Labor Distribution
  • Billing

22
Project Management
  • Project management addresses the recording,
    tracking, and reporting of financial data for a
    variety of State projects and contracts. This
    module addresses the following
  • Key processes for operating and capital projects,
    including project development, execution, and the
    project close process.
  • Tracking of project progress using work plans,
    tasks, resource assignment, controlled critical
    path, and deliverables.

23
Grants Management
  • Grant accounting enables the recording and
    monitoring of all grant activity. Grant
    accounting functionality includes
  • Grant award
  • Grant billing and draw processing
  • Grant reporting
  • Sub-grantee accounting

24
Asset Management
  • Asset Management addresses the need for the State
    to track and account for all capitalized assets.
    Additionally, Asset Management performs the
    following
  • The ability to produce reports in accordance with
    GASB 34 for inclusion with the CAFR.
  • Allows the agencies to track other items as
    needed, including sensitive items and other
    controlled assets (e.g., guns, PDAs, digital
    cameras).
  • Processing of surplus assets
  • Processing of lost and stolen assets

25
Procurement
  • Procurement includes the traditional solicitation
    process used for purchasing goods and services,
    as well as new eProcurement functionality
  • Catalog procurement
  • Reverse Auctions
  • Vendor registration and other self-service
  • Commodity maintenance
  • Vendor performance management

26
Procurement Best Practices -Traditional
Procurement Process
  • Requisitioner initiates purchase requisition
  • Approvals provided via automated workflow
  • Solicitation initiated based on pre-defined
    business rules
  • Posted to State Procurement Web Site
  • Automatically pushed to vendors registered to
    service specific commodity(s)
  • Solicitation responses received from vendors
  • Responses tabulated, evaluated and awarded

27
Procurement Best Practices -Traditional
Procurement Process
  • All vendors submitting bids receive email
    notification of award
  • Purchase order created and issued
  • Goods receipt entered
  • Invoice receipt entered
  • Automated three-way match performed
  • If no exceptions, payment request generated
  • If exceptions exist, they must be resolved

28
Procurement Best Practices -Catalog Procurement
  • Requisitioners procure goods and/or services from
    vendor catalogs at the States pre-negotiated
    prices via the Internet
  • Types of catalogs available may include
  • Catalogs that reside inside the States firewall
    (e.g. statewide or agency contracts)
  • Catalogs that reside at the vendors site
    requisitioners punch-out to vendor web sites to
    configure and price items this information is
    then retrieved and used in building a requisition
  • Catalogs for goods or services purchased from
    other organizations within State government

29
Procurement Best Practices -Catalog Procurement
  • Purchase order created and issued
  • Approvals provided via automated workflow within
    agency or across agencies
  • Goods receipt entered
  • Invoice receipt entered
  • Automated three-way match performed
  • If no exceptions, payment request generated
  • If exceptions exist, they must be resolved

30
Procurement Best Practices -Reverse Auctions
  • Typically performed for certain types of
    purchases (e.g., bulk commodity purchases,
    big-ticket items)
  • State notifies prospective vendors of upcoming
    auction, including auction start and end dates /
    times
  • Vendors registered with the State to provide
    specified commodity(s) are invited to participate
    in the auction
  • Notice of auction posted to Division of
    Purchasing Web site
  • Vendors log in, view and accept terms and
    conditions, target bid price, specifications, and
    enter their respective bids in online, real-time
    mode
  • Vendors can view other bids and submit lower bids
    to stay competitive

31
Procurement Best Practices
  • Market Place Examples
  • Catalog procurement
  • Reverse auctions

32
Procurement Best Practices -Vendor Self-Service
  • Vendor registration
  • Special certifications can be captured (e.g.,
    Small Business, Woman Owned, Minority Owned)
  • Maintenance of basic vendor information (e.g.,
    contact information)
  • Maintenance of commodities serviced
  • Automatic pushing of bid opportunities to
    vendors that service specific commodities
  • Inquiry into status of transactions with State

33
Procurement Best Practices -Vendor Performance
Management
  • Track contacts with problem vendors (phone calls,
    written contacts regarding problem
    orders/delivery of goods and services)
  • Automatically track and report/inquire on vendor
    performance, including
  • Orders
  • Delivery
  • Returns
  • Bid history
  • Payment history
  • Complaints and resolution

34
Inventory
  • Inventory Management addresses the need for
    selected agencies to purchase, store and
    distribute, and replenish goods within a
    warehouse or central stores operation.
    Additionally, this module provides the following
    functions
  • Ability to provide inventory data for inclusion
    with the CAFR
  • Allows the agencies to effectively manage
    inventory cost and quantities
  • Provides a mechanism to allocate inventory costs
    to programs and organizations
  • Provides reordering process or replenishing
    inventory when specific reorder points are met
  • Provides for full integration with Procurement
    module
  • Supports the use of bar coding technology

35
Fleet Management
  • Fleet Management addresses the need for the State
    to manage and efficiently maintain its investment
    in vehicles and other motorized equipment.
    Additionally, Fleet Management performs the
    following
  • Reduces vehicle downtime to the State through the
    use of effective preventive maintenance
  • Provides the ability to manage vehicle
    assignments and the proper allocation of the cost
    within the organization
  • Provides the ability to track and manage fuel
    cost

36
System Requirements Validation Objectives
  • It is essential that a comprehensive set of
    detailed requirements be developed as they will
  • Identify the system requirements necessary to
    support the States business processes
  • Be included in Request for Proposal and used as a
    checklist against which to evaluate vendor
    offerings
  • Become part of the contract entered into with the
    selected vendor(s)
  • Monitored during implementation to ensure all
    requirements were met, and that work was not
    performed to develop functionality that did not
    support the documented requirements

37
System Requirements Validation Process Used
Functional and Technical Requirements Development
Process
Requirements from 2001 Needs Assessment Study

Baseline
Draft
Final
Focus
End User Community
Project Team
Requirements
Requirements
Requirements
Group
STA Requirements Toolkit
38
System Requirements Validation Accomplishments
  • Focus Group Kick-Off Meeting on 10/09/06 with75
    agency participants
  • Over 130 participants representing 25 agencies
    in various Focus Groups to-date
  • Requirements cover 14 functional areas
  • Final draft requirements are almost complete.
    Will be posted to the web for review by all state
    agencies by late next week (Nov. 17).

39
System Requirements Validation Where We Are?
Requirements from 2001 Needs Assessment Study

Baseline
Draft
Final
Focus
End User Community
Project Team
Requirements
Requirements
Requirements
Group
STA Requirements Toolkit
  • Attend Agency Requirements Outreach Briefing
    (November 14 or 17)Download and review
    requirements applicable to your agencys business
    functionsEmail completed Feedback Response
    Template by 12/04/06
  • Conduct statewide stakeholder meetings Early
    October (Human Resources, Payroll, Financial,
    Budget Development) and 9-28/10-6 (Purchasing)
  • Stakeholders download requirements and response
    templates
  • Stakeholders email the response template back to
    us by 10/14

40
System Requirements Validation Process for
Obtaining Agency Feed back
  • Download the following files from the FMS Web
    site (the URL is http//da.ks.gov/ar/fms/)
  • Functional requirements
  • Requirements Feedback Template (Excel file)
  • Enter your recommended additions, changes, and
    deletions to the requirements in the Requirements
    Feedback Template
  • Save the template using the following naming
    convention
  • Abbreviated Agency Name Your Last Name
    Example
    KDHE Smith
  • Email the completed template as an attachment to
  • Noelle Jones at noelle.jones_at_da.state.ks.us

41
System Requirements Validation FMS Web Site
http//da.ks.gov/ar/fms/
42
System Requirements Validation Sample
Functional Requirements
43
System Requirements Validation Vendor Response
Codes
  • SF Standard functionality
  • NR Provided in Next Release
  • MI Minor Modification
  • MA Major Modification to Source Code
    Required
  • RQ Provided through Reporting or Query Tool
  • CD Custom Development
  • TP Third Party Software Required
  • NA Cannot Meet Requirement

44
System Requirements Validation Requirements
Feedback Template
45
System Requirements Validation Adding a
Requirement
  • To add a requirement
  • Enter the reference number of the requirement you
    would like the new requirement to follow
  • Enter the requirement
  • Enter an A in the Add/Change/Delete column
  • Provide additional explanation in Comments
    column if needed

46
System Requirements Validation Changing a
Requirement
  • To change a requirement
  • Enter the reference number of the requirement you
    would like to change
  • Enter the requirement as changed
  • Enter a C in the Add/Change/Delete column
  • Provide additional explanation in Comments
    column if needed

47
System Requirements Validation Deleting a
Requirement
  • To delete a requirement
  • Enter the reference number of the requirement you
    would like to delete
  • Enter the requirement to be deleted
  • Enter a D in the Add/Change/Delete column
  • Provide additional explanation in Comments
    column justifying why the deletion is required

48
System Requirements Validation Guidelines for
Reviewing Requirements
  • Do not attempt to document your existing systems/
    processes describe your future requirements
  • Focus on what the system must do not how.
    System design will be completed after product
    selection
  • Ensure that the requirements are documented in
    clear and concise statements (single requirement
    -- dont blend multiple requirements together)
  • Focus on requirement content, not wordsmithing
  • Remember that considerable work has already been
    put into validating the requirements by the Focus
    Groups
  • We need all Requirements Feedback Templates
    returned to Noelle Jones by December 4th

49
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