Business Management System

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Business Management System

  1. 1. Business Management System Outline of Scope BMS
  2. 2. BMS Key Elements Business Management System Budget Development & Production Budget Formulation Advice Portfolio Performance Review Financial Reporting & Control Cash Management
  3. 3. Benefits of the BMS system One system to support the Integrated Management Cycle Incorporating: Budget Development & Production Budget Formulation Advice Portfolio Performance Review Financial Reporting & Control Cash Management Analysis & Reporting <ul><li>Analytical & Reporting Engine – to support informed, quality decisions </li></ul><ul><li>Output data consistent and integrated with financials </li></ul><ul><li>Actuals integrated with budget </li></ul><ul><li>Graphical analysis and trend data readily available </li></ul><ul><li>Flexible reporting to support analysis </li></ul><ul><li>Improved Integrity – one version of the truth </li></ul><ul><li>Automated data validation </li></ul><ul><li>Departmental ownership of relevant data </li></ul><ul><li>Improved reconciliation within and between databases </li></ul><ul><li>Enhanced Efficiency – better use of resources </li></ul><ul><li>Reduced time spent on non-value adding tasks </li></ul><ul><li>Status tracking and semi-automated workflows </li></ul><ul><li>Streamlined reporting between departments and DTF </li></ul>Benefits
  4. 4. <ul><li>To co-ordinate the ERC process </li></ul><ul><li>To plan the position of government in terms of financial and performance objectives, output delivery, and asset investment </li></ul><ul><li>To produce the strategic priorities and projected financial statements for government and departments (the Budget Papers) </li></ul>Budget Development & Production Supports the production of <ul><li>The Budget Papers </li></ul><ul><ul><li>Annual Budget – </li></ul></ul><ul><ul><ul><li>Whole-of-Government (WOG) financial statements and strategic policy directions (BP2) </li></ul></ul></ul><ul><ul><ul><li>Financial statements and output statements by department (BP3) </li></ul></ul></ul><ul><ul><ul><li>Regional Budget Paper(s) </li></ul></ul></ul><ul><ul><ul><li>Annual Appropriation Acts </li></ul></ul></ul><ul><ul><ul><li>Asset Investment Program (BP1) </li></ul></ul></ul><ul><ul><li>Budget Update – </li></ul></ul><ul><ul><ul><li>Updated Whole- of-Government (WOG) financial statements and strategic policy directions </li></ul></ul></ul><ul><li>BMS will automatically capture in pre-defined formats, the critical financial and performance information that enables the production of the Budget Papers </li></ul>PURPOSE BDP
  5. 5. Budget Development & Production The initial building block is last year’s Budget and agreed policy Last year's Budget is rolled over to create a new baseline Baseline financials are reviewed Financials and strategic policy directions are revised to reflect policy and non-policy variations… Departments prepare ERC (1 & 2) submissions based on revised departmental business plans and government strategic priorities. Submissions are analysed and DTF makes recommendations to ERC DTF recommendations are taken to ERC in the form of briefing papers ERC submissions are submitted to DTF via a standard template ERC evaluates recommendations The impacts of ERC decisions are reflected in budget financial statements, performance measures, objectives, outputs, investments and POBOS ERC makes decisions The impact of non policy variations such as parameter changes (including CPI and productivity) is incorporated in projections DTF produces the Budget Papers Scoresheets are prepared by DTF to assist in analysing the effects of proposed submissions & ERC decisions on the projections PROCESS BDP
  6. 6. <ul><li>To provide advice to government pertaining to departmental submissions to ERC and Ministers. </li></ul><ul><li>To liaise with departments </li></ul>Budget Formulation Advice Supports the production of <ul><li>DTF Briefing Papers to ERC and Ministers </li></ul>PURPOSE BFA
  7. 7. Budget Formulation Advice Financials are revised to reflect policy variations… Departments prepare ERC submissions based on revised departmental business plans or government strategic priorities. DTF recommendations are taken to ERC in the form of briefing papers ERC (1 & 2) submissions are submitted to DTF via a standard template ERC evaluates recommendations The impacts of ERC decisions are reflected in financial statements, performance measures, objectives, outputs, investments and POBOS ERC makes decisions PROCESS Submissions are analysed by DTF using analytical tools. DTF makes recommendations to ERC BFA
  8. 8. <ul><li>To review departments’ Quarterly Performance Report relating to: </li></ul><ul><ul><li>strategic issues and </li></ul></ul><ul><ul><li>performance in terms of asset and output delivery, using the performance indicators of quality, quantity and timeliness </li></ul></ul><ul><li>To recommend to: </li></ul><ul><ul><li>the Minister for Finance the appropriate level of revenue to be certified </li></ul></ul><ul><ul><li>ERC appropriate actions relating to strategic issues </li></ul></ul>Portfolio Performance Review Supports the production of <ul><li>The Quarterly Performance Report (Evaluation of departmental strategic Output Performance against quarterly targets & certification of revenue) </li></ul><ul><li>The Output Pricing Review process </li></ul>PURPOSE PPR
  9. 9. Portfolio Performance Review DTF & departments agree annual performance targets, which are published in Budget Paper 3 Departments submit quarterly phasing of targets Each department submits quarterly performance reports DTF assesses strategic issues and analyses departmental performance against targets, in terms of asset and output delivery, to evaluate the degree to which revenue should be certified DTF prepares a report on 1. Strategic issues and recommended appropriate actions 2. Performance against performance indicators for the Minister for Finance (summary statements of financial performance and financial position by department and at a consolidated level) 3. Revenue approval The Treasurer disperses funds The Minister for Finance signs off revenue recommendations and notifies DTF DTF reports to the Treasurer via the report noted above incorporating the Minister for Finance’s sign off DTF notifies departments of revenue to be recognised DTF reports to ERC on strategic issues and recommends appropriate actions DTF agrees quarterly phasing of targets Each quarter, departmental revenue is recognised by DTF for the delivery of outputs… PROCESS PPR
  10. 10. Portfolio Performance Review (cont.) Output costs information is prepared by departments Departments submit output costs information DTF prepares a report for ERC on output prices DTF reports annually and quarterly to Commonwealth / National Accounts / ABS (GFS). Data is analysed to support pricing and output reviews Annually, each department submits actual output costs to DTF… PROCESS PPR
  11. 11. <ul><li>To review and report the financial performance of: </li></ul><ul><ul><li>General Government on a monthly and quarterly basis </li></ul></ul><ul><ul><li>Whole-of-Government on mid year and annual basis. </li></ul></ul><ul><li>To provide stewardship and monitoring on behalf of Victorians to ensure integrity, performance and compliance </li></ul><ul><li>To provide sound financial management and investment of the state’s resources including cash </li></ul><ul><li>To report annually and quarterly for Commonwealth / National Accounts / ABS (GFS) </li></ul>Financial Reporting & Control Supports the production of <ul><li>Monthly - General Government Sector reports </li></ul><ul><li>Quarterly - GFS and AAS Financial Statements for General Government Sector </li></ul><ul><li>Annual and half yearly - Whole-of-Government (WOG) reports </li></ul>PURPOSE FRC
  12. 12. Financial Reporting & Control Budgets collected and reported… Actuals collected and reported… Monthly, departmental actuals are reviewed and accepted DTF reviews and analyses actuals against budget and reconciles inter-entity balances, using a standard set of business rules DTF consolidates and produces monthly reports for the Financial Reporting Committee Meeting and the Balance Sheet Management Committee, which report to the Treasurer Quarterly, mid year and annual reports are tabled in parliament Quarterly, mid year and annual, WOG reports are produced DTF & departments agree annual financial estimates, which are published in Budget Paper 3 Twice annually, departments phase their budgets to months DTF agrees monthly phasings Budget phasings are accepted Half yearly and annually, departmental and agency actuals are reviewed and accepted PROCESS FRC
  13. 13. <ul><li>To manage the state’s cash, including to disburse, collect, invest and optimise in pursuit of maximised returns to government and minimise borrowing costs to the state </li></ul><ul><li>To provide an intergrated management of the Public Account, including investments, trust accounts and advances plus the public bank account </li></ul>Cash Management Supports the production of <ul><li>Daily CMS transaction reports and trust balancing reports </li></ul><ul><li>Monthly balance reports comprising inter-entity balances, revenue for outputs, revenue allocated to SAU, and the Public Ledger update report </li></ul><ul><li>Forecasting of the cash position </li></ul><ul><li>Compliance to warrants </li></ul>PURPOSE CM
  14. 14. Cash Management Account balances are downloaded from Desk Bank Departments provide initial current day expenditure advice DTF makes a Short Term Money Market cash decision Departments provide further advice regarding expenditure and receipts DTF compares known receipts against forecasts DTF makes a further cash decision DTF uses a mismatch report to reconcile prior day balances to prior day estimates Monthly decisions… DTF uses a mismatch report to reconcile the monthly SAU account balance to the daily aggregation of bank movements DTF uses a mismatch report to reconcile between departmental inter-entity SAU accounts and the central DTF SAU account Daily decisions and reconciliations… PROCESS Journals are received by departments DTF monitors cash drawdown against warrant amounts Departments provide monthly cash transactions to the public ledger CM
  15. 15. BMS will provide one version of the truth to inform Stakeholders BDP BFA PPR FRC CM BMS Departments Departments DTF ERC ERC ERC Departments DTF Treasurer Departments DTF DTF Portfolio Ministers Departments Parliament ABS Minister for Finance Auditor Treasurer Minister for Finance Treasurer Treasurer Minister for Finance DTF Treasurer Auditor Minister for Finance
  16. 16. Implementation Plan June 2003 Portfolio Performance Review Implementation phase 3 (Fully integrated BMS) June 2003 Financial Reporting & Control Ongoing Communication, Training and Support Implementation phase 2 Implementation phase 1 January 2003 Financial Reporting & Control (Existing actuals) January 2003 Portfolio Performance Review October 2002 Budget Formulation Advice October 2002 Budget Development & Production

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