Finit solutions getting the most out of hfm - intercompany matching and eliminations webinar

The Finit Solutions Series
Getting the Most out of HFM:
Intercompany Matching andIntercompany Matching and
Eliminations
September 16 2009September 16, 2009
Presented by Angie Apple
www.finitsolutions.com

About Finit Solutions

Th Fi it S l ti S i
Getting the Most out of HFM: Intercompany & Eliminations
Finit Introduction The Finit Solutions Series
Finit Solutions specializes in consulting services in the Oracle Hyperion Enterprise
Performance Management Solutions suite of products:
Financial Consolidation and Reporting
– Financial Management (HFM)
– Hyperion EnterpriseHyperion Enterprise
– BI+ Reporting Tools
Data Integration
– Financial Data Quality Management (FDM)
– Oracle Data Integrator (ODI)
– Data Integration Management (DIM)
Planning and Business Intelligence
– Planning
– Essbase
‐ 3 ‐
ssbase

Th Fi it S l ti S i
Finit’s HFM Expertise The Finit Solutions Series
• Finit provides a unique combination of advanced HFM product expertise and solid
accounting backgrounds .  Our HFM‐certified consultants come from audit, finance,
d i d f l CPA d/ MBA
p
and accounting, and most of our consultants are CPAs and/or MBAs.
• We design and implement HFM applications, upgrades, redesigns, and
conversions from Hyperion Enterprise for middle market companies to some of the
l i h F 500largest companies on the Fortune 500.
• In addition to intercompany issues, we also design solutions around complex
foreign currency analysis (including constant‐rate reporting), phased financial close
l d t ti IFRS d US GAAP dj t t d t il d h flcalendars, tax reporting, IFRS and US GAAP adjustments, detailed cash flow
analysis, and various other advanced accounting requirements.
• Finit is a member of the Oracle HFM Customer Advisory Board.  In this role, we
k di tl ith d t d l t d lit i i t t ddwork directly with product development and quality engineering teams to address
future enhancements to HFM.
• Rob Cybulski, co‐founder of Finit, is the HFM domain lead for the Oracle
A li ti U G ’ S i l I t t G
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Applications User Group’s Special Interest Group.

Th Fi it S l ti S i
Finit’s Client Service The Finit Solutions Series
W t k li t i i lWe take client service very seriously.
Our methodology of efficiently developing effective
solutions and exceeding expectations on every
project has resulted in a 100% client satisfaction rate
at more than 100 clients.
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Th Fi it S l ti S i
Some Finit Clients The Finit Solutions Series
•
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Th Fi it S l ti S i
About the Presenter The Finit Solutions Series
Angie Apple
aapple@finitsolutions.com
• One of Finit’s 2 founding
partnerspartners
• HFM Certified Consultant
• Has been designing and
i l ti H iimplementing Hyperion
tools for over 10 years
• Specializes in conversions
f H i E ifrom Hyperion Enterprise
to HFM
Lily and Reesie
Learning about intercompany
‐ 7 ‐
g p y

Th Fi it S l ti S i
How to Ask a Question The Finit Solutions Series
Q
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Th Fi it S l ti S i
Purpose of this Session The Finit Solutions Series
• To explain and demonstrate how metadata settings in the Account
and Entity dimensions affect Intercompany Matching & Elimination
p
y p y g
• To explain and demonstrate how the Account, Entity, ICP, and Value
dimensions work together to perform intercompany eliminations
• To show examples of intercompany eliminations, including matches
and mismatches in both local and translated currencies
• To demonstrate options for setting up the system‐generatedTo demonstrate options for setting up the system generated
Intercompany Matching reports
• To provide best practices for designing a dynamic consolidating
report (with intercompany eliminations) in BI+ Financial Reporting
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Intercompany Basics
(for the non‐accountants)(for the non accountants)

Th Fi it S l ti S i
Intercompany Basics The Finit Solutions Series
• Subsidiary companies (or departments, or segments, etc)
frequently have intercompany transactions with each other, which
p y
q y p y ,
results in intercompany balances on each subsidiary’s books at the
end of the month.
• These intercompany balances must be ‘eliminated’ within the
consolidation, so that the consolidated company does not include , p y
any balances that are the result of intercompany transactions.
• If this rule did not exist, there would be enormous opportunity for
companies to overstate their revenues by simply selling back and
forth among subsidiary companies.
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g y p

Th Fi it S l ti S i
Intercompany Basics The Finit Solutions Series
p y
United States
SalesInterco : 0
PurchasesInterco : 0
West Region
SalesInterco : 1500
East Region
SalesInterco : 0
Los Angeles
SalesInterco: 1500
Denver
SalesInterco : 0
Philadelphia New York
PurchasesInterco: 0 PurchasesInterco : 1500
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Intercompany Metadata
SettingsSettings

Th Fi it S l ti S i
Entities The Finit Solutions Series
• Flagging the IsICP attribute adds the entity to the list of
Intercompany Partners in the ICP dimension.  This means that p y
other entities can book intercompany balances with this flagged
entity.
• An entity that does not have IsICP flagged can book intercompany
balances with other ‘IsICP’ entities; however, no entities would be
able to book intercompany balances with the ‘non IsICP’ entityable to book intercompany balances with the non‐IsICP entity.
• It is generally not advisable to flag a parent entity as IsICP, because
if th t t tit d t i t i ll tit ll th thif that parent entity does not exist in all entity roll‐ups, then the
elimination will not occur.  For example, the parent entity ‘East’
might exist in your Region roll‐up but not in your Segment roll‐up.
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Th Fi it S l ti S i
Accounts The Finit Solutions Series
There are 3 account member attributes for setting up an
intercompany account:
• IsICP – To flag the account as an intercompany account.
−Y if ICP balances, including self‐ICP balances, are allowed for the
account (not recommended)account (not recommended)
−R if ICP balances are allowed for the account, but entities cannot
have ICP balances with themselves in this account
N if ICP b l t ll d f th t−N if ICP balances are not allowed for the account
• ICPTopMember ‐ Specifies which top member in the hierarchy of
the ICP dimension is valid for the account
• PlugAcct ‐ Must be the name of a valid account or blank. Used
when IsICP is Y or R. If blank, no elimination occurs.
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Th Fi it S l ti S i
Plug Accounts The Finit Solutions Series
• The plug account takes the offset of the intercompany elimination.
When multiple intercompany accounts have the same plug account,
thi t i t t h
g
this generates an intercompany match.
• If the group of intercompany accounts does have matching
balances, then the plug account will be zero at the consolidated , p g
entity. If the group of intercompany accounts does not have
matching balances, then there will be a leftover balance in the plug
account at the consolidated entity.
• The plug account should be flagged as an IsICP account so that you
can see the detail of each entity eliminating into the plug account.
• You should not assign a plug account to another plug account.
• If no plug account is assigned to an intercompany account, no
elimination will occur
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elimination will occur.

Th Fi it S l ti S i
Accounts The Finit Solutions Series
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PlugAcct is the common member that ties the accounts together e.g., IntercoDiffPL

Examples

Th Fi it S l ti S i
Examples The Finit Solutions Series
• Example 1:  Simple IC match (Philadelphia, New York)
• Example 2: Simple IC mismatch (Philadelphia New York)
p
Example 2:  Simple IC mismatch (Philadelphia, New York)
• Example 3:  No plug account assigned (LT Rec / Pay)
• Example 4: Simple IC match at Region level (Philadelphia Denver)Example 4:  Simple IC match at Region level (Philadelphia, Denver)
• Example 5:  Simple IC match with translation
• Example 6: Simple IC mismatch with translationExample 6:  Simple IC mismatch with translation
• Example 7:  Base entity does not exist in all orgs
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Intercompany Matching Reports

Th Fi it S l ti S i
IC Matching Reports The Finit Solutions Series
• HFM’s intercompany matching reports are system generated and
require very little set‐up
g p
• The matching reports can only be accessed via the workspace; they
cannot be used from the HFM client or from BI+ Financial Reporting
S f th ti f tti i t t hi t• Some of the options for setting up intercompany matching reports
include:
– Specifying the exact entities you wish to match (e.g. Philadelphia against New
York)
– Matching a range of entities (e.g. all base entities)
– Suppressing matched balances within a specified tolerance thresholdSuppressing matched balances within a specified tolerance threshold
– Displaying or suppressing custom dimension members on the report
– Specifying the currency in which you wish to view the report
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Th Fi it S l ti S i
• Example 1:  Basic intercompany matching report
– All base entities against all base entities
g p
– User has security to all entities
– All base entities against all base entities– All base entities against all base entities
– User only has security access to Mexico
– In USD, in MXP
– Specific entity (e.g. Denver) against all base entities
– User has security to all entities y
• Example 4: Intercompany matching report with matches suppressed
– Zero tolerance
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– Non‐zero tolerance

Th Fi it S l ti S i
Why don’t my intercompany matching reports work?  Common causes:
g p
y y p y g p
• Improper use of the override settings
– When in doubt, use the overrides. Worst case is that you may be selecting the sameWhen in doubt, use the overrides.  Worst case is that you may be selecting the same
settings that are already set up in the report.
– Be very careful with the Value dimension.  If you are using journals, be sure to always
select the ‘Total’ member (e.g. <entity curr total>, USD Total, etc.)
• Not flagging IsICP for an entity
The intercompany matching reports will only include entities that have the IsICP flag– The intercompany matching reports will only include entities that have the IsICP flag
turned on.
– Example:  Cancun can book intercompany balances to other entities, but other
entities cannot book intercompany balances against Cancun.  Cancun will not appear
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on the intercompany matching report.

Th Fi it S l ti S i
Why don’t my intercompany matching reports work?  Common causes:
g p
y y p y g p
• Using generic intercompany entities
– Example: If you book intercompany balances to a generic entity such asExample:  If you book intercompany balances to a generic entity such as
‘GenericMexico_IC’, but ‘GenericMexico_IC’ does not itself have any data, then there
is no match.
– The intercompany matching report will still show all the intercompany balances on the
t b t th ill ll h t h d (b f t d treport, but they will all show up as unmatched (because, from a metadata
perspective, they don’t match.)
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Showing Intercompany
Showing Intercompany
Eliminations in
Financial Reporting

Th Fi it S l ti S i
Showing IC in Reports The Finit Solutions Series
The elimination at any parent entity is always the sum of the
elimination value members of all the children of that entity
g p
elimination value members of all the children of that entity:
+ Philadelphia <parent curr total> + East <parent curr total>+ Philadelphia <parent curr total>
+ New York <parent curr total>
+ Philadelphia [elimination]
+ East <parent curr total>
+ West <parent curr total>
+ East [elimination]
+ New York [elimination]
= East <entity currency>
+ West [elimination]
= United States <entity currency>
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Example

Contact and Future Webinars

Th Fi it S l ti S i
Upcoming Webinars The Finit Solutions Series
Getting the Most out of FDM:
FDM Logging
p g
On October 21, you will learn about the different types of logging features in
FDM that can be used to track the full data audit trail and the full detail around
all activities performed in the application. This webinar will provide you with the
tools to better leverage the FDM logging capabilities and to place tightertools to better leverage the FDM logging capabilities and to place tighter
controls on your data and FDM application.
Getting the Most out of HFM:
Financial Reporting Tips & TricksFinancial Reporting Tips & Tricks
The quality of your Financial Reporting reports is a large part of your
organization’s perception of HFM, because many users only interact with those
reports. On November 18, you will learn to apply best practices to yourreports. On November 18, you will learn to apply best practices to your
Financial Reporting reports that will significantly improve the end‐users’
experience with HFM and reduce the maintenance workload on your corporate
consolidations team.
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To register, go to www.finitsolutions.com/Insights_Webcast.html

Th Fi it S l ti S i
Finit Contacts The Finit Solutions Series
Q ti ?Questions? Angie Apple (Partner)
aapple@finitsolutions.com
215‐651‐4661
Email us for a
215 651 4661
Ed DeLise (VP of Sales)
d li @fi i l i
copy of the slides or
l k h d
edelise@finitsolutions.com
678‐296‐3611
link to the recording.
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