KINROSS STRIKES GOLD WITH ADVANCED REPORTINGPresenters:Justin McNeely - Account Executive, Performance Analytics CorporationSharon Chadwick - Manager, Kinross Advanced Reporting SystemSusan Harris, Director of Consolidations & Kinross Advanced Reporting System
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Canadian consulting firm focused exclusively on SAP Enterprise PerformanceManagement solutionsImplementing SAP BusinessObjects Planning and Consolidation (BPC) since2003Currently support the majority of Canadian customers using BPCConsultants located across CanadaConsultants have Finance background: CA, CGA, CMA, CPAServices include: Evaluation, Design, Implementation, Project Management,Training, and Support
Sample of Canadian SAP BPCCustomers
Common Issues Process Issues Environmental Issues ■ Silos of information ■ Structural changes (account, org) are painful ■ Data integrity and validation issues ■ Lack of controls, approvals, and audit trail ■ Multiple currencies ■ Compliance with SOX/C198 difficult ■ Manual security ■ IFRS ■ Excel hell ■ XBRL ■ Version comparison and variance analysis difficult ■ Manual process – time consuming – 80/20 rule ■ What-if analysis difficult Lengthy Cycles
Introducing SAP BusinessObjectsPlanning & Consolidation (BPC) MS SQL SAP Server NetWeaver
What the Industry Analysts aresaying… Gartner SAP is a Market Leader and has the strongest vision IDC SAP #1 in Performance Management Tools Forrester SAP has the strongest offering in the Business Performance Solutions market Microsoft – SAP press release November 2009 Microsoft Corporation supports the SAP® BusinessObjects™ Planning and Consolidation application, version for the Microsoft platform, as a preferred solution for customers running their business applications on the Microsoft platform.
Kinross Gold CorporationCorporate profile ■ Canadian based gold mining company with mines & projects in the USA, Brazil, Chile, Ecuador, Ghana, Mauritania & Russia ■ Employees: Approximately 7,000 worldwide ■ Strategic focus is to maximize net asset value & cash flow per share2010 performance & highlights ■ Production: 2.3 million gold equivalent ounces ■ Revenue: USD 3 billion ■ Acquired Red Back Mining ■ Increased revenue, cash flow & earnings ■ Advanced growth projects ■ Expanded gold reserves & resources
Kinross Advanced Reporting SystemKARS Implementation ■ External auditors, KPMG, assisted with selection process: ■ Enterprise wide solution to meet both financial and operational requirements ■ Single, reliable and centralized source of information that everyone in the company could access ■ Highly intuitive and provide familiar interfaces, including Microsoft Office ■ Scalable to support the company’s growth ■ Implementation partner: Performance Analytics Corporation ■ Two phases ■ External financial reporting ■ Internal operational reporting
Kinross Advanced Reporting SystemKARS Project Team & Consulting ■ Project team ■ Project managers - 1 x PAC, 2 x Kinross - Finance & IT ■ Consultants - 2 x PAC ■ KARS team - 4 x Kinross Finance, including system administrator ■ Key business users across company ■ Consulting ■ Application design ■ Fully calculated cash flow ■ Elimination of investments ■ Gold equivalent ratio by month, quarter & YTD ■ Imperial to metric conversion for USA sites ■ Reports, input schedules & custom journal report ■ Interfaces
Kinross Advanced Reporting SystemKARS Project Plan 19-Jun-08 31-Mar-09 Overview Scrub Data Consolidation Adjustments Parallel sub-consolidations KARS sub-consolidations Project Coordination JUN 1 JUL 1 AUG 1 SEP 1 OCT 1 NOV 1 DEC 1 JAN 1 FEB 1 MAR 1 APR 1
Kinross Advanced Reporting SystemBPC Applications DailyRate: Daily currency rates, metal & oil prices. Rate: End of month & monthly average for Fx rates & prices. Finance: Consolidation of financial & operational data. Ownership: Entity ownership data. Operations: Operational/production data.
Kinross Advanced Reporting SystemBPC Applications – continued … Dimensions (18) Shared e.g. Category Unique e.g. Account Alternate hierarchies e.g. Entity Legal, Management, Geographic and Segment. DailyRate Rate Finance Ownership Operations
Kinross Advanced Reporting SystemKARS Training & Documentation ■ Developed ■ 1½ day training course ■ User guides for Operations & Finance ■ ½ day report writing course post ‘go-live’ ■ On-site training ■ Operating mine sites ■ Regional offices
Kinross Advanced Reporting SystemKARS Milestones ■ Monthly reporting implemented April 2009 ■ “Go live” for external reporting – Q2 2009 ■ Financial statement preparation for Q2, Q3 & Q4 based on KARS data ■ Legacy/Excel consolidation run in parallel for Q2, Q3 & Q4 to verify KARS data – discontinued Q1 2010 KARS
Kinross Advanced Reporting System“Then” quarterly consolidation process ■ First collected at a regional level ■ Highly summarized financial data ■ Submitted to headquarters 10 days after financial reporting cut-off date ■ Headquarters took a week to generate consolidated P&L & balance sheet ■ Another week to issue consolidated cash flow report ■ Request for more detail placed additional burden on regions and/or local business units
Kinross Advanced Reporting System“Now” monthly consolidation process ■ WD3 ■ AP & AR closed 8am ■ Ounces produced input & transferred to Finance ■ WD6 ■ Source GL (JD Edwards) closed 8am & data loaded into BPC ■ Operations data transferred to Finance at 3pm ■ WD8 ■ Balance sheet continuities completed – cash flow completed ■ Supplementary input schedules completed ■ All entities submitted by COB ■ WD9 ■ Operations results issued to SLT ■ Regional signoff – KARS locked for the period ■ WD10 ■ Consolidated results issued to Executive Team
Kinross Advanced Reporting SystemResults ■ Rapid external financial reporting ■ First time in company’s history that audited quarterly financial statements were released at the same time as publicly announced quarterly financial results ■ Reduced reporting cycle timeline ■ 50% faster for completing consolidated balance sheet, profit & loss and cash flow statements ■ Business users can focus more time on analytics & operational improvements ■ Consolidated ‘monthly’ internal reporting ■ Delivered on budget & on time
Kinross Advanced Reporting SystemKARS Report stacks Financial statements Operational metrics ■ Profit & loss ■ Production & costs ■ Balance sheet ■ Production & sales summary ■ Cash flow ■ Site statistics ■ Intercompany matching ■ Production ■ Note disclosures ■ Costs by element ■ MD&A ■ Fuel costs ■ G&A ■ Corporate responsibility reporting e.g. consumption of carbon-emitting substances ■ Monthly commentary ■ Quarterly site financial reporting packs
Business Benefits Reduced cycle times and associated costs Improve accuracy and alignment with strategic goals Increase governance, control and accountability Spend more time analyzing and modeling the business and less time gathering data