Hyperion Planning Functional Overview - Demo Video

Namaste!

I have created a video on various planning models and departments involved in an organization's planning and budgeting process.

Happy Learning.

I have published an Advanced course on Hyperion Planning in Udemy. Here is the coupon code. Please check it out if you are interested.

https://www.udemy.com/course/hyperion-planning-advanced-course/?couponCode=PLNADV3

HFM - Member Lists

Namaste!

Hyperion Financial Management (HFM) is best used for financial consolidation and reporting needs. HFM Application consists of metadata structures to be able to map the corporate chart of accounts (COA).

Metadata contains flat list of COA as well as hierarchies to meet the reporting requirements. Alternate hierarchies are another way of accommodating the various reporting  structures.

In the similar lines, Member Lists are another method of organizing the metadata to meet the specific requirements of categorization and organization of metadata.

There are 2 types of member lists., one is static member lists and other is dynamic member lists.
In this video, we will go through the static member lists.

I have published an Advanced course on HFM in Udemy. Here is the coupon code. Please check it out if you are interested. 

https://www.udemy.com/course/hyperion-financial-management-advanced-course/?couponCode=HFMADV9

Hyperion Planning - Requirements Document Preparation - 2

Namaste!

welcome back to the "Hyperion Planning - Requirements" blog series.

In earlier blog, we have discussed the Revenue and Expense Planning requirements.

https://padmaja-vemireddy.blogspot.com/2020/02/hyperion-planning-requirements-document.html

In this blog, we are going to continue with the rest of the budget models., Balance Sheet and Cash Flow Statements.

Balance Sheet Modelling

Fixed Assets Requirements

 
Requirement-8:


Total Utility Plants in Service

Description:

Total Utility Plants in Service includes:

•  Buildings
•  Intellectual Property
•  Generation and Transmission Assets
•  Other Fixed Assets

Manual input for Opening Balance to Total Utility Plants in Service as well as the Additions made during the current  period

Calculation:

Net Utility Plant:

Total Utility Plants in Service (Opening Balance + Changes in CWIP + Additions made +   Capitalized Interest)
(+) CWIP
(-) Accumulated Depreciation and Amortization

Note: CWIP is Construction work in progress


Current and Accrued Assets Requirements


Requirement-09:

Cash – Funds and Special Deposits

Description:

Cash Funds and Special Deposits include the Cash on hand, Cash in Construction Funds, Deposits for special purposes and all other Current Assets

• Provision to input the amounts

Requirement-10:

Materials and Other Supplies

Description:

Materials and Other Supplies includes raw materials apart from fuel and any other supplies required for power generation

• Provision for calculation of the value of Materials and Other Supplies

Calculation:

The Opening Balance is increased by the rate of inflation to arrive at the Closing Balance
   

Requirement-11:

Prepayments

Description:

Prepayments are the expenses paid in advance.
These are mostly Property Insurance.
They are recognized as expenses over the period in which the benefit from the expense is derived.

Calculation:

Prepayments = Beginning Balance + Prepaid during the period – Amount Expensed
   

Other Assets Requirement

Requirement-12:

Un-amortized Debt Discount and Extraordinary Property Losses

Description:

Un-amortized Debt Discount includes refinancing costs and other discounts yet to be amortized


Calculation:

Closing Balance = Beginning Balance  + Additional Costs incurred -  Amount Amortized
   


Requirement-13:

Other Deferred Debits and Accumulated Deferred Income Taxes

Description:

Other Deferred Debits are similar to Prepaid Expenses.

• Provision to track the Deferred Debits

Calculation:

Closing Balance = Beginning Balance + Additions – Amount expensed
   

Total Margins and Equity Requirements

Requirement-14:

Long Term Debt

Description:

Long Term Debt is classified as Other Debts.

• Provision to calculate the movement of Long Term debts

Calculations:

Closing Balance of the Long Term Debt = Beginning Balance + Additions – Repayments

Closing Balance = Beginning Balance + Additional Debts incurred - Principal Repayments
           
Net Interest Accrued unpaid = Gross Interest Accrued - Interest Payments (Expensed) - Interest Payments (Capitalized)

   

Current and Accrued Liabilities Requirements

Requirement-15:

Accounts Payable

Description:

Accounts Payable includes all the expenses which are due, but unpaid.

• Provision to calculate Accounts Payable

Calculations:

Accounts payable is calculated as follows

            Closing Balance =
            (+) Beginning Balance
            (+) Operating and Maintenance Expenditure
            (+) Capital Expenditure Payable
            (-) Fuel Cost
            (-) Payroll related Adjustment
            (-) Payment made (This is assumed to be the same as the Beginning Balance)

  

Requirement-16:

Taxes Accrued

Description:

Taxes Accrued comprises Property Taxes and Income Tax.

• Provision to calculate the Accrued Taxes at the end of the period
• Provision for entry of Taxed paid
• Provision for entry of Expense Accrued (Taxes)

Calculation:

Beginning Balance  + Total Property tax  -  Property tax payments made + Federal taxes – Taxes paid
   

Requirement-17:

Interest Accrued

Description:

Interest Accrued includes the interest payments which fall due but are unpaid

• Provision to calculate the Interest Accrued at the end of the period
• Provision to input Interest Payments made
• Provision to input the Accrued Interest

Calculation:

Closing Balance = Beginning Balance  + Interest accrued for the period – Interest payments made
   

Requirement-18:

Other Current and Accrued Liabilities

Description:

All Other Current and Accrued Liabilities are contained within this item.

• Provision to input Additions to this account
• Provision to input Deductions to be made from this account

Calculation:

 Closing Balance = Beginning Balance  + Additions during the period – Deductions during the period
   


Requirement-19:

Accumulated Operating Provisions

Description:

Accumulated Operating Provisions are made for operating expenses.

• Provision to calculate Accumulated Operating Provisions
• Provision to input the inflation rate

Calculation:

Closing Balance = Opening Balance + Inflation Rate
   

Cash Flow Modelling

The Cash Flow statement would be prepared using the Indirect Method, where Net Income is the starting point for showing the movement of cash.

Temporary Investments on the Assets side of the Balance Sheet is arrived at using a combination of Direct and Indirect methods.

Requirement-20:

Operating Receipts

Description:

Operating Receipts include the Revenue Receipts from retail, Industrial, and other Sales. It also includes the Gain on Sale of Allowances and Interest Earnings

Provision to calculate Operating Receipts

•         Revenue – Retail
•         Revenue – Industrial
•         Revenue – Other Sales
•         Gain on sale of Allowances
•         Interest Earnings

Calculation:

The Revenue figures are calculated by multiplying the respective Effective Rates by the respective Sales volume.


Requirement-21:

Production Over head and Maintenance (O&M)

Description:

• Production O&M costs are Operations and Maintenance Expenditure paid out in cash
• Provision to calculate Production O&M

Calculation:

Operating Expense-Production-Excluding Fuel + Maintenance Expense-Production



Requirement-22:

Administrative & General

Description:

Administrative & General (A&G) costs include customer service, sales related and administrative expenditure as well as General Plant Maintenance paid out in cash

• Provision to calculate Administrative and General (A&G) Costs

Calculations:

Operating Expense(Customer Service and Information) + Operating Expense(Sales) + Operating Expense(Administrative and General) +  Maintenance Expense -  Site Lease Expense


Requirement-23:

Changes in Working Capital

Description:

The Changes in Working Capital item captures movement in Working Capital during a given  period by calculating the difference between the Opening and Closing Balances of Working Capital items (e.g., Current Assets and Liabilities)

• Provision to calculate Changes in Working Capital.

The Beginning and Closing balances of the following Working Capital Assets and Liabilities:

•             Accounts Receivable
•             Materials, Supplies & Other
•             Prepayments
•             Other Current Assets
•             Accounts Payable
•             Taxes Accrued
•             Other Accruals

Calculations:

Closing Balance – Opening Balance


Note:    Negative number on a liability indicates an outflow



Requirement-24:

Income Taxes from Operations

Description:

Income Taxes from Operations includes Income Taxes paid out in cash.

• Provision to input Income Taxes

Requirement-25:

Other Disbursements

Description:

Other Disbursements includes other miscellaneous payments made in cash

• Provision to input and calculate Other Disbursements

Calculations:

Sum of all the individual expenses


Requirement-26:

Capital Expenditure

Description:

Capital Expenditure includes Generation, Transmission, Buildings and Other Capital Expenses paid out in cash

• Provision to input Capital Expenditure
• All outflows towards Capital Expenditure (Captured as part of Total Utility – Assets)
• All Capital Inflows, if any

Calculations:

All Cash Outflows towards Capital Expenditure – All Capital Inflows

In next blog, we are going to wind up by disusing the rest of the topics.

Those are., Reporting requirements and Security Matrix.

Happy Learning!

I have published an Advanced courses on Hyperion Essbase, Planning and HFM on Thinkific Learning Platform. Please apply the coupon codes found on the site to avail the discounts on the courses. Please check it out if you are interested. 

https://courses.trnghub.com/

Hyperion Planning - Requirements Document Preparation - 1

Namaste!

welcome back to "Hyperion Planning - Requirements" blog series.
In earlier blog, we have discussed the questions to be asked during requirements workshop.

https://padmaja-vemireddy.blogspot.com/2020/02/hyperion-planning-requirements-workshop.html

After the requirements workshop has been conducted, all the responses for "requirements questionnaire" from the stake holders has to be collected, analyzed and prepare the "Business Requirements Document (BRD)" or "Functional Specification Document (FSD)".

Today, we will discuss how a typical BRD or FSD looks like.

It all starts with outlining the current budget system/processes in place with client.

Imagine we are preparing this document for a hydro electric company's budgeting requirements.
 
Here is a sample write-up on overview and current state.,

Overview:

The Functional Requirements Document captures the requirements of Client with regard to their Budget and Forecast process. The current budget cycle is manual-intensive incorporating spreadsheet distributions to maintain budget and forecast data. The process is time consuming, person-dependent and prone to inconsistencies.

As-Is Process/Current State of budgeting and reporting processes:

• The budgeting of revenue from the customers is based on usage and other factors.
• General and Administrative expense budgets are provided by the Budget Analysts from various functions/departments.
• The sites provide the budgets for the Operations and Maintenance Expenditure. All other expenses are budgeted based on the prior year actuals.
• Labor costs are calculated on separate spreadsheets using headcount and work hour data.
• All other expenditure items are input, based on prior year actual figures.
• The Trial Balance Budget is prepared followed by the Income Statement in order to provide the Net Income Budget.
• Balance Sheet budget is prepared using opening balances from the previous period. Additions and deductions are provided from relevant income statement budget items or recalculated every period depending on the budget item.
• Cash Flow Statement is prepared using outcomes from the Net Income and movement in current assets and liabilities.
• Forecasting is based upon the current budget.
• Variances are spread across the remaining current budget period dependent of Expenditure Type.
• Actuals are obtained from the Oracle EBS GL system and compared to budget items to arrive at variances.
• Reporting is done on budgeted financial statements, site expenses, labor and overall variances.
• Reporting is handled at the department level and then combined through spreadsheets for overall level reporting. 

After explaining the current state of the budgeting system/processes, the next step would be documenting the functional requirements. Please note that, this section would be combination of the current processes as well as the future or new requirements.

It would be very important to review the functional requirements with the client, time-to-time. Upon receiving the feedback from stake holders, any gaps in understanding the requirements could be patched up!

I would put the high level requirements into following broad categories:

• Revenue Budget Modelling
• Expense Budget Modelling
• Capex Budget Modelling
• Manpower Budget Modelling
• Report Templates/Definitions
• Workflow requirements
• Security Matrix

Revenue Modelling Requirements:

The revenue budgeting process involves arriving at the rates for various customers, taking into account the different calculations and adjustments involved.

Each Customer Type is associated with a different rate structure. The rate structures are derived by making calculations and adjustments as per statute and contractual obligations. The rates are then multiplied by the usage to arrive at the revenue budget figures.



Requirement -1:
Sales

Description:    

• The term, Sales, defines the usage amount hydro power sold to members.
  Provision for entry of usage by Customer Type
• The usage figures are entered for each customer type, month and year.
• Household rates
• Industrial rate

Requirement -2:
Miscellaneous Income

Description:

• Income generated apart from selling hydro power
• Provision for input of the various types of Miscellaneous Income
• All types of miscellaneous income.,Interest Income, Rental Property (For Month, Year, Account)

Expense Modelling Requirements:

The Expense Budget is a combination of the G&A (General and Administrative) budgets, O&M (Operations and Maintenance) budgets and Other Expenditure budgets.

These are primarily straight figures based on previous year Actuals. However, in case of G&A expenditure, the gross budget amounts entered by the Budget Analyst are split between the Departments.

Requirement -3:
General and Administration Expenditure

Description:

General and Administration (G&A) Expenditures are overhead rates which are incurred by the functions or departments. The Budget Analyst would enter a gross amount as the budget for his/her responsibility organization for G&A expenditure.

• Provision for distributing the gross amount to various departments based on predetermined percentages using a  general/common account for the gross amount.
• Provision for input of amounts to G&A accounts directly if no distribution is required. 
• Provision for allocation to Sites.
• Provision for input of the gross amount at Site/Location level. 

   
Calculations:

• The ratio is to be applied to the gross amount and charged to the relevant G&A accounts by organization. 
• The general/common account is split based on the Departments.

   

Requirement -4:
Operations and Maintenance Expenditure

Description:

Operations and Maintenance (O&M) Expenditures are overhead rates incurred at the Sites for Operations and Maintenance.

• Provision for input of the O&M Expenditure at Plan) / Location level 
• Provision for allocation to Sites

Requirement -5:
Other Expenditure

Description:

Other Expenditures are overhead rates incurred at the Corporate level:

• Property Tax
• Total Interest
• Depreciation
• Provincial Tax
• Federal Tax
• All other non-operating expenditures marked as overhead expenses

• Provision for input of the Other Expenditures at Corporate level 
• Provision to enter the supporting detail 
• Provision for allocation to Sites

 
Requirement -6:
Labor Costs - Expense

Description:

Labor Costs are tracked at the Organization level. The rates for each employee are maintained in Oracle HRMS.

The following are the rates associated to Labor Costs (each salary plan/department combo has different rates):
           

• Standard Rate: The rate employees are paid
• Increase Rate:  The rate the standard pay is increases periodically based on planned             merit increases
•  Overtime Rate: The rate overtime pay is calculated
• Burden Rate:    The overhead rate added to the pay (includes healthcare, pension, etc)

Note: Standard and Overtime costs have different Burden Rates.

Once Labor Costs are calculated, they are allocated to different COA accounts and departments

• Provision to distribute Labor Costs to expense accounts as per COA.
• This is to be done by entering all the Labor Costs to a common labor project & common labor task and distributing it based on per-determined percentages to various COA accounts 
• Provision for allocation to Sites

Calculations:

• Standard Labor Cost is a product of Standard Rate and Hours
• Overtime Labor Cost is a product of Overtime Rate and Hours
• Burden Rate is applied on the total cost – separately for Standard and Overtime
• Percentages are applied for allocation of the total costs

   

Requirement -7:
Labor Costs - Capital

Description:

Labor Costs incurred in Capital Projects are capitalized.
The portion which is to be capitalized goes into a capital account.
The Labor Costs which are not capitalized are split between different COA accounts based on              predetermined percentages.
Capital costs are incurred only by IT and Sites

• Provision to enter the budget for capitalized labor by Project
• Provision to extract the labor cost to be capitalized from the total Capital Budget
• Provision to maintain the Capital Budget in Hyperion
• Provision for allocation to Sites

In next blog, we will discuss the following requirements

• Balance Sheet requirements
• Cash Flow Statement requirements

Happy Learning!

I have published an Advanced courses on Hyperion Essbase, Planning and HFM on Thinkific Learning Platform. Please apply the coupon codes found on the site to avail the discounts on the courses. Please check it out if you are interested. 

https://courses.trnghub.com/

Hyperion Planning - Requirements Workshop

Namaste!

Welcome to the Hyperion Planning blog series. Earlier I have written a blog on Hyperion Financial management (HFM) requirements gathering, analysis and preparation of Business Requirements Document (BRD). It was quite lengthy 5 series blog.

This time I want to write a bit crisp version of  Hyperion Planning related, right from the preparation of requirements questionnaire for workshop, analyzing the responses from stake holders and finally prepare the BRD or FSD (Functional specification document) before moving on to the next phases of Hyperion Planning Implementation life-cycle.

As you know, all projects kick start with project charter on hand to understand very high level scope of the project.

As a first step, it would be very important to understand the current state of the planning, budgeting and reporting process in place. Once we identify the stake holders ., primarily with FP&A (Financial Planning and Analysis) department, conducting the several workshops to interact with them would be the next step.

Here is the list of questions that would help us to understand the current landscape of the planning, budgeting and reporting systems or processes.

This is not an exhaustive list for sure but it would get you going.

1    Please explain the current budgeting and forecasting cycle?

Please expect client's response as described below. This is a sample write-up for your understanding.,

The client's annual budget process is a traditional incremental budgeting.  Under this process, budgets are developed and reviewed in the context of the previous year’s budget with funding decision-making primarily focusing on the incremental change to the budget.

Currently budget process has both bottom-up and top-down characteristics.  From corporate strategy stand point it would be a top down and all functions/cost centres use bottom-up approach

Though strategic plan and limited performance data is incorporated into functions budget request submissions every other year, this information does not align to a comprehensive company wide strategic plan and typically serves as contextual or reference information rather than as a driver for the allocation of budget resources. 

Further, the company capital budget does not directly integrate to the operating budget. Hence, decisions regarding capital investment are often made without direct access to information regarding the impact on long-term operating expenditures.

The Client currently develops its annual budget using a disparate collection of software tools throughout the budget development and execution life-cycle.  Accordingly, the company's budget process has been aligned around these different tools and can be characterized as having many discrete sub-processes with limited integration.

The lack of an integrated, end-to-end budgeting application drives many inefficiencies, puts constraints on budgetary analysis, and lacks a platform for effective implementation or integration of current or future policy initiatives to the budget process such as strategy management to support Budgeting for Results or linking capital and operating budgeting.  

2    How frequently would forecasting be performed (Monthly/Quarterly)?

3    Is there any requirement of Rolling Forecast (12 month at any point of time) 

4    Is P&L Budgeting and Forecasting in-scope?

5    Is Workforce and Compensation Planning in-scope?

6    Is Balance Sheet Planning in-scope?

7    Is Cash Flow Planning in-scope?

8    Is Capex Planning in-scope?

9    Is Projects Planning in-scope?

10    How many number of  users would be using the future budgeting and forecasting system?

11    Does budgeting use single or multiple currencies?

12    What is Reporting Currency?

13    Does Budget write back to ERP GL is in-scope?

14    Does Revenue Planning and Forecasting done at Location level?

15    Does budget/forecast preparation done at location level but entered into Planning & Budgeting application by Region level FP&A Team?

16    Would you anticipate more granular level (detailed) than GL accounts level for Planning and forecasting?

17    What would be the Time granularity for planning, budgeting and forecasting?

18    Would you anticipate to plan the Revenue and Opex based on prior year/month's actual average trends and to be able to make adjustments on top of the trends?

19    Would you plan to use the driver based revenue or opex planning?

20    Does workforce compensation planning and budgeting to be done at employee level, job level or Employee and job level?

21    Are there any compensation related expenses driven by formula rather than direct input?

22    How hourly based expenses are going to be budgeted (Hourly full time vs Part time)?

23    Would you anticipate to plan employee transfer between departments and Locations?

24    Would you anticipate to plan employee terminations/departures/retirements in a budget cycle?

25    Does Opex planning happens by department using GL accounts?

26    Identify and group the Opex GL accounts that are relevant to departments is in-scope?

27    Are "Facility Expenses" going to be derived using drivers or Direct input?

28    Are "Travel and Entertainment Expenses" going to be derived using drivers or direct input?

29    Are "Marketing Expenses" going to be derived using drivers or direct input?

30    Are "Selling Expenses" going to be derived using drivers or direct input?

31    Are there any Expenses to be allocated for reporting purpose?

32    Do you have any list of Existing Asset details for Depreciation calculations?

33    How many new assets to be budgeted for budget cycle?

34    What is Depreciation method for New Assets?

35    Are existing and new "leased assets" depreciation calculations in-scope for budgeting?

36    Is Asset transfer process in-scope for budgeting?

37    Is  asset retirement process in-scope for budgeting?

38    How many financial reports to be built for management reporting?

39    Does Variance reporting generated from Budgeting or GL Systems?

40    Do you have any other reporting requirements that budgeting systems should meet?

I will prepare a sample requirements document (BRD / FSD) based on the common responses for the above questions in next blog.

Happy Learning!

I have published an Advanced courses on Hyperion Essbase, Planning and HFM on Thinkific Learning Platform. Please apply the coupon codes found on the site to avail the discounts on the courses. Please check it out if you are interested. 

https://courses.trnghub.com/

HFM 11.2 Business Rules - Translations using Historical Rates

Namaste!

In Hyperion Financial Management, we have a common requirement to translate the data using:

• Average rate for Income statement accounts
• End of month rate for Balance sheet accounts

However below accounts would need to translate using Historical rates. Some of these accounts are:

• Investment in Subsidiaries
• Prior year retained earnings
• Investment in properties

In this video I am going to explain how to write the business rule to achieve the translation for these accounts using Historical Translation Rates.

I have published an Advanced courses on Hyperion Essbase, Planning and HFM on Thinkific Learning Platform. Please apply the coupon codes found on the site to avail the discounts on the courses. Please check it out if you are interested. 

https://courses.trnghub.com/