Global Business Services © 2006 IBM Corporation ENCOMPASS: Project Module Work Group 4/4/07...

Global Business Services

© 2006 IBM Corporation

ENCOMPASS:Project Module Work Group

4/4/07 Meeting

© 2006 IBM Corporation2

Table of Contents Review of the Proposed Project Module Approach

– Defining a Project

– Defining a Fund

– Defining Funding Source and Funding Source Allocation

– Defining Funds Distribution Process

Project Module Chartfield Descriptions– Defining Activity

– Defining Source Type

– Defining Category

– Defining SubCategory

– Defining Analysis Type

Overview of the Cash Drawdown Process

Next Meeting



Review of the Proposed Project Module Approach


Basic Project Management and Reporting Principles One Standard Project Module Approach for the Entire State

All Chartfields will be used for consistent purposes by the Entire State.

Project Reporting in Encompass will support the:

– Generation of Schedules to Support State Financial and CAFR Reporting Requirements;

– Accumulation of Capital Asset and Infrastructure Costs to Support State Financial and CAFR Reporting Requirements

– Generation of the Schedule of expenses and Federal Awards and Schedules to Support OMB A-133 Reporting Requirements;

– Generation of Federal Financial Reporting Schedules and Supporting Documentation; and

– Generation of Federal Cash Drawdown Calculations and Supporting Documentation

Commitment Control will be Required to be Assigned at the Fund, Project and Funding Source Levels.


Goals of the Project Reporting Work Group

Finalize the Configuration of the Project Module Approach in Compliance with the Basic Project Management and Reporting Principles.

Provide Feedback on the Proposed Project Module Approach.

Discuss potential Issues to the Proposed Approach based upon Project Management and Reporting Requirements for your Agency.

As a Group, identify Solutions to these potential Issues.



Defining A Project


Defining A Project A Project is an accumulation of costs for a definite period of time.

The Project provides a significant portion of the transaction classification capability necessary to track expenses, revenues, asset capitalization and other financial activity in accordance with:

– Federal grant and federal appropriation requirements including those related to OMB-A133, cash drawdown and periodic federal financial reporting;

– State statute and State appropriation requirements, including those related to State Construction Projects;

– State Financial Reporting Requirements, including those related to the preparation of the CAFR and the appropriate accumulation of costs for the construction of capital assets and infrastructure;

– As required by other contractual agreements.

Every Project will have a Budget assigned at the Project Level for Commitment Control purposes.


Defining A Project (Continued) A Project will be REQUIRED in each of the following

instances:

All expenses of federal funds must be reported using Projects, including:– Federal Grants and Appropriations received;

– Federal Grants and Appropriations passed through to subrecipients within State government; and

– Federal Grants and Appropriations passed through to subrecipients outside of State government.

Any expense that results in the construction of a State capital asset must be reported using Projects, including– State construction projects;

– Construction of capital assets by state agencies; and

– Construction of infrastructure assets by state agencies.


Defining A Project (Continued)

Consistently across the State, there will be a Separate Project for each individual Grant Award Year.

– Example: FSSA would have separate project for their TANF05, TANF06 and TANF07 grant awards.

OPTIONAL: Agencies are allowed to have Child Projects at a lower level than individual Grant Award Year as long as they have a Parent – Child Relationship with the Project that represents the individual Grant Award Year.

– Example: For WIA06, DWD could potentially have Child Projects for WIA06-Dislocated Worker, WIA06-Youth, WIA06-Adult.



An agency could request to report additional functions as Projects.

All requests for new Projects would be evaluated centrally to ensure the following:

– The functions are not better suited to be captured in another chartfield

– The level of detail being reported is consistent with the State’s approach.



Project Chartfield Value = 15 Alphanumeric Characters

First 3 characters = Business Unit

Next 12 characters = Unique Project ID (Centrally Defined)

State Subrecipients will use same last 12 characters of the Project ID

Last 3 digits of Business Unit

Centrally defined with agency input


Defining A Project – Open Issues

For subrecipient dollars from another state agency, there is an agency need to track individual local projects in a parent-child relationship below the parent project that has the same twelve digit Project ID as the Granting State Agency.

The State Granting Agency also needs to capture the total subrecipient activity for Federal Reporting and Cash Drawdown processes from reports based upon the twelve digit Project ID of the parent project.

What is the best approach to fulfill both of these needs?



Defining A Fund


Fund is the primary means within a Business Unit for tracking and relating specific sources and uses of revenues or budget authority.– Fund chartfield values = 5 numeric characters.

– Replaces the 4 digit Fund and 6 digit Center combination.

– Fund will be a required Chartfield for ALL Transactions

Some current Fund Center combinations will not be needed after conversion to ENCOMPASS:

– Prior year centers replaced by Budget Reference;

– Construction centers replaced by Projects; and

– Geographic locations replaced by Locality.

Defining A Fund


Defining A Fund (Continued) Federal Funds will be defined where each Functional State

Agency will have one Federal Fund for each Federal Granting Agency (Example: Each functional business unit that receives funds from DHHS would have one DHHS fund).

– Exception: Major Funds in the CAFR (Major Moves & Medicaid) will be reported in separate funds.

– Exception: Federal Funds of multiple Fund Types for CAFR reporting (Special Revenue, Capital Projects, etc.) will be reported in separate funds.

State Funds will continue to be determined at the level of State Appropriations or as outlined in State statute.


Defining A Fund (Continued)

Appropriations and Allotments will be established for ALL State and Federal Funds.

The Appropriation and Allotments for the Federal Fund will be developed based upon grant award letters, prior years’ history, and financial projections.

The Appropriation and Allotments for the State and Local matching components (where applicable) will be Appropriated and Allotted in one or more State Fund(s) based upon the relevant State Appropriations.

The Budget Authority in the State Fund(s) will be transferred to the Federal Fund as the Budget Authority is Allotted.


Defining A Fund – Open Issues

US Fish & Wildlife has more restrictive policies on intermingling financial transactions and non-diversion of certain State revenues that may require Federal approval to change related accounting treatment.



Defining Fund Source in Commitment Control


Defining Funding Source in Commitment Control:Functions of the Funding Source

Funding Source = (Six character numeric value field that will be sequentially autonumbered with a leading zero.)

Funding Source will be used to enforce commitment control on a distinct funding stream:

– All or a portion of the funding source would be applied to various projects.

– Funding Source commitment control will ensure that no more than 100% of a funding source is applied to project(s).

– Funding Source commitment control will ensure a project will not overspend the assigned amount of a funding source.


Defining Funding Source in Commitment Control: Overview Funding Source will be used to store information on a distinct funding

stream associated with one or more projects including:

– Description Funding Source Table

– CFDA # CFDA Number

– Grant Document ID # Fed Aid

– Original Fund FS Char 1

– Initial Year Budgeted / Awarded FS Char 2

– Total Award Amount Amount

– Award Amendment Amount FS Trans Log Item

– Remaining Available Balance Amount minus Applied


Defining Funding Source in Commitment Control: Overview (Continued) Funding Source (Sample Screenshot)


Defining Funding Source in Commitment Control:Funding Source Allocation Process

The Funding Source will be defined in Commitment Control and then assigned at the Project Budget level based upon Funding Source Allocation rules for the Project.

The data entry clerks will not assign the Funding Source at the time of Initial Transaction Entry.

Instead, the Funding Source(s) would be assigned to related transactions of a Project at the time the transactions are Budget Checked based upon the Funding Source Allocation rules established for the Project.


Defining Funding Source in Commitment Control:Funding Source Allocation Process (Continued)

Limitations of the Funding Source Allocation Process:

The Funding Source Allocation can only allocate a transaction for a single project by: – Priority (Spend 100% of A before applying B); or

– A Percentage (Apply 50% of A and 50% of B) • Typically the Percentage Allocation Process will be used by

agencies.– The Fund Allocation Process will NOT allocate based upon both

sets of criteria (Priority and Percentage) for a single project.

The Funding Source Allocation is determined at the Project Level.

The Funding Source Allocation will NOT function unless the entire Project Budget is assigned to one or more Funding Sources as part of the Funding Source Allocation rules.


Defining Funding Source in Commitment Control:Funding Source Allocation Process (Continued) The assignment of a Funding Source for Commitment

Control through the Funding Source Allocation Process will be required for ALL Projects.

– For INDOT Federal Appropriations, the Funding Source will be associated to the SubFederal Granting Agency level by year of initial award (FHWA05, FTA06, FAA07)

– For Federal Grants (Block Grants and Single Purpose Grants) the Funding Source will be at the individual Grant Award Year/Grant Document ID.

– For State Appropriations transferred to Federal Funds, the Funding Source will be associated to the State Matching Fund and the initial year of appropriation.


Defining Funding Source in Commitment Control:Funding Source Allocation Process (Continued) Funding Source Allocation (Sample Screenshot)


Defining Funding Source in Commitment Control – Open Issues

Why are Two or More Funding Sources Required in a Project to represent the State and Federal Share of the Transaction as opposed to One Funding Source for the entire current share of the project budget?

How will commitment control be established at the project level for multi-year grants since Funding Source Allocation requires the entire Project Budget to be 100% allocated to Funding Sources?

If Funding Source Allocation occurs at the Project level, what will be the process for Grants where different Activities are Reimbursed at different Percentages?

How will Funding Source Allocation be utilized for Grants where the Federal Funding Source should be determined based upon the related Service Date?



Defining Funds Distribution


Defining Funds Distribution in the Projects Module

Funds Distribution is NOT the same process as Funding Source Allocation.

Funds Distribution is a delivered PeopleSoft process. The intent of Funds Distribution is:

To distribute project costs among multiple funding sources based on user identified distribution rules. These rules are applied to incoming transactions to assign costs accordingly.

Transactions are selected for funds distribution based on the following transaction attributes:

– Project

– Activity

– Analysis Type


Defining Funds Distribution (Continued)

The Project Module’s Funds Distribution Process will be used to assign Category(s) and, if applicable, SubCategory(s) based upon the established Funds Distribution Process for each Project to denote the funding stream(s) for each transaction.

Based upon additional functionality in the State modification, the Funds Distribution Process can allocate Project transactions by percentage with a defined priority sequence which will revise the funding stream(s) and percentages when a certain funding stream has been fully consumed.



The Funds Distribution Process will be used to assign a distributional activity code to Project transactions to identify the percentage of each transaction to be forwarded to the Contract and Billing Modules for Federal and Local Billing.

The Funds Distribution Process produces new transactional lines with a separate Analysis Type while maintaining the original transactions and their original Analysis Type.

The Analysis Type serves as a means to view transactions based upon both their classification before and after funds distribution.

The Funds Distribution Process will be Required for ALL Projects.



Why are Funding Source Allocation and Funds Distribution Required for ALL Projects?

– The Funding Source Allocation Process is required to maintain Commitment Control at the individual funding stream level at the time of the initial transaction.

– The Funds Distribution Process is required for Federal and Local Billing as well as Federal Reporting generated from the Project Module.

– The Funds Distribution Process as modified by the State Modification includes the additional functionality to integrate the assignment of transactions by Percentage and Priority, which is not supported in the Funding Source Allocation Process or the delivered Funds Distribution Process.


Defining Funds Distribution (Continued) State Modification of Funds Distribution Process

(Sample Screenshot)


Defining Funds Distribution – Open Issues

At least one agency is currently determining the Funds Distribution process by Project, Activity and Source Type.

– Will the INDOT modification and/or the ENCOMPASS approach prevent this in the future, if so how will this need be fulfilled?

At least one agency is currently using Source Category and Source SubCategory in Time & Labor as a means to filter the options staff have when entering time.

– If these fields are not allowed to be used in Time & Labor and then replaced in the Funds Distribution Process, how will this need be fulfilled?

How will Funds Distribution be utilized for Grants where the Federal Funding Source/Source Category should be determined based upon the related Service Date?



Project Module Chartfield Descriptions


Defining Activity

There will be two types of Activities assigned to ALL transactions in the Project Module:

– Functional Activity is assigned to the initial transaction – this should be at the level of detail of the federal award budget

– Distributional Activity is assigned during fund distribution – this will denote Federal, State or Local sources as required in the Federal Billing process.

ALL Project Transactions are required to be assigned a Functional Activity.

ALL Project Transactions will be assigned a Distributional Activity after the Funds Distribution Process

After the Funds Distribution Process, the Functional Activity will be maintained in Project User Field #5 in the Project Module for each transaction.


Defining Functional Activity Functional Activity = (a seven numeric character chartfield).

ALL initial transactions containing a Project must have a Functional Activity assigned.

The Functional Activity at a minimum must be reported at the same detailed level as the Federal Budget for the Federal Grant or Federal Appropriation.

Budgets can be Developed at the Activity Level.

– Where required by the Federal Grant / Appropriation a Commitment Control Budget will be Required to be established at the Activity level.

– OPTIONAL: Where not required by the Federal Grant / Appropriation, the Activity Budget can be used only for Tracking purposes.


Defining the Functional Activity – Federal Cost Category Reporting Where Federal Agencies Require the Grant to be Budgeted at

the Federal Cost Category, the Federal Cost Categories will be captured at the Activity Level.

Where the Federal Cost Category is only used for Federal Reporting, if State Agencies can develop a Consistent State-wide Account Roll-up Tree for reporting Federal Cost Categories, the Federal Cost Categories will be captured in this Consistent State-wide Account Roll-up Tree instead of using the Activity or Source Type to capture this information.


Defining Functional Activity – Capital Construction / Infrastructure Projects

A Table is being added to the Project Module to define the Capitalization Percentage for Capital Projects at the Project or Activity chartfield level.

For Projects that result in the Construction of State Capital Assets or State Infrastructure, a Capitalization Percentage must be assigned at the Project or Activity chartfield level to signify what portion of the Project Costs should be reported in the Asset Module when the Project is marked as completed.


Defining Distributional Activity Distributional Activity = (a seven alphanumeric

character chartfield).

ALL transactions processed through Funds Distribution will be assigned Distributional Activity(s) based upon this process.

ALL transactions within a Project will undergo the Funds Distribution Process.

The Distributional Activity(s) will be available to be used in the PeopleSoft Contracts & Billing Process (Optional) to denote amounts to be billed to the federal government and potentially to local governments, if applicable.


Defining Source Type (Resource Type)

Source Type = (5 alphanumeric character chartfield):

– For agencies that are required to report to the Federal Government at a level more detailed than the level required for budgetary control, the Source Type Chartfield will capture this information. Example:• DOH may be required by a Federal Grant to establish a Budget

at the level of Salaries, Fringe Benefits, Contractual Costs, etc. this would be the Functional Activity.

• Below these activities they may be required for Federal Reporting to report Salaries separately by Professional Salaries – Certifications, Professional Salaries – Non-Certifications and Administrative Salaries. This more detailed information would captured in the Source Type.


Defining Source Category (Resource Category)

Category = (5 character numeric chartfield that is autonumbered sequentially to correspond to the Funding Source value):

The Category chartfield is assigned to each transaction that undergoes the Funds Distribution Process.

For Federal Grants (Block Grants and Single Purpose Grants) the Source Category will be assigned at the level of the Individual Grant Award/Grant Document ID.

For INDOT’s Federal Appropriations the Source Category corresponds to the granting subagency and the year of initial award (FHWA05, FHWA06, FTA05, FAA06)


Defining Source SubCategory (Resource SubCategory)

SubCategory = (5 alphanumeric chartfield):

– The SubCategory allows you to track and report transactions at a funding stream level in more detail than that captured in the Category.

– In general, the SubCategory will NOT be required to be assigned to transactions in the Funds Distribution Process.

– In instances where there is a need to utilize the SubCategory, the SubCategory will be assigned during the Funds Distribution Process.• For INDOT’s Federal Appropriations, the SubCategory will be

assigned to all transactions at the individual Federal appropriation level.

• For certain Federal Grants there may be a similar need to use the SubCategory field to track transactions related to a specific funding stream at a level lower than the Individual Grant Award/Grant Document ID level.


Defining Analysis Type

Analysis Types are automatically assigned within the Project Module to individual transactions to identify different types of transactions, such as estimated costs, budgeted amounts, actual costs, and billed costs.

To ensure the same transaction line is not processed multiple times by the Funds Distribution Process, the Funds Distribution Process rules will be defined to select transactions with a defined Analysis Type (generally “ACT” for Actuals) and then assign a new Analysis Type of “FND” on the new transaction line produced during Funds Distribution.

Separate Analysis Types will be established in the Project Module to capture In-Kind Contributions, Third Party Match and Maintenance of Effort without reporting this information in the General Ledger.


Defining Project Chartfields – Open Issues

Where a Federal Grant is Required to be Budgeted at both the Federal Cost Category (Personal Services, Supplies, etc.) and Federal Program (Intake, Administration, etc.) levels which chartfields should be used to capture this information?



Overview of the Cash Drawdown Process


Cash Drawdown Process

ENCOMPASS will produce Periodic Reports of the Federal Percentage of Cash Disbursements by Project and Funding Source/Category for a defined period to act as a supporting schedule for State Agencies in determining their Cash Drawdown Calculations.

OPTIONAL: While FSSA and INDOT are implementing additional PeopleSoft Modules (Contracts, Billing, A/R) to automate the calculation of the Federal Cash Drawdown and incorporate CMIA clearance patterns within PeopleSoft, the automation of this process is not required for Proposed Project Approach.


Cash Drawdown Process – Open Issues

For some Federal Grants with Local Matching Components, an additional calculation will be required when calculating the Federal Costs available for Reimbursement based upon if Third Party Match Requirements have been met to authorize the cash draw.

How will the Reports developed to support the Cash Drawdown calculations account for this scenario?



Next Meeting:Project Module Mock-upApril 11, 2007 Conference Room A


Contact Information

ENCOMPASS Website

– http://myshare.in.gov/sba/encompass

Project Reporting Work Group Webpage

ENCOMPASS Email Address

– [email protected]

Reference to Version 8.9 Peoplebooks

– http://devfin.gmis.in.gov/soi_fssignon_index.html

– Commitment Control Peoplebook

– Project Costing Peoplebook

We welcome your feedback/questions/comments

Global Business Services © 2006 IBM Corporation ENCOMPASS: Project Module Work Group 4/4/07...

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