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Position Budgeting & ControlHuman Resources and Finance

Ross Building

Room 136

1 p.m. – 5 p.m.

October 18, 2005

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Welcome!

Introductions of Group• Name

• Department

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Workshop Logistics

Tent Cards

Rest Rooms

Breaks

Parking Lot

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Workshop Agenda

1. Discuss WorkshopObjectives

2. Overview of PBC

3. Review the ProposedFuture Process

4. Capture Issues in the“Parking Lot”

5. Discuss Next Steps

6. Adjourn

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Our Objective Today

Discover SAP terminology, definitions, and capabilities.

Specific opportunities for businesstransformation.

Validate Requirements for PBC

Identify gaps in requirements

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What will come from this Meeting?

The output from this meeting includes…

A Business Process Review Report.

To-Be Process Flowcharts.

Gap Analysis Report.

Functional Specifications Report

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Let’s Get Started!

Our topic today is…

• Position Budgeting & Control

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What is PBC?

PBC is the abbreviation for PositionBudgeting and Control.

PBC resides in the HR modules ofSAP.

PBC forecasts future salary andbenefit costs per employee andestablishes commitments(encumbrances) by cost elements.

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PBC is New SAP Functionality!

The OnePurdue team does not yet haveaccess to the PBC module.

Today, you will learn about “assumed”functionality. Assumptions are based onconversations with Texas State Universityand Johns Hopkins. Bearing Pointconsultants have also provided information.

We will not be able to show actual screenshots from SAP.

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Let’s Review Cost Elements

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Core SAP Finance

Functional Area(4 Characters)

Functional Area(4 Characters)Functional Area

Sponsored Program(10 Characters)

Funded Program(10 Characters)

Internal Order(10 Characters)WBS Elements(24 Characters)

Funded ProgramInternal OrderWBS Element

Fund Center(10 Characters)

Fund Center(10 Characters)

Cost Center(10 characters)

Cost CenterFund Center

Fund(8 Characters)

Fund(8 Characters)Fund

Sponsored Class(5 Characters)

Commitment Item(5 Characters)

Cost Element(5 Characters)G/L AccountG/L Account

(5 Characters)

Business Area(2 Characters)

Business Area(2 Characters)

Business Area(2 Characters)Business AreaBusiness Area

(2 Characters)

Financial Mgmt Area(3 Characters)

Controlling Area(3 Characters)Company CodeCompany Code

(3 Characters)

GM(Grants Management)

FM(Funds Management)

CO(Controlling)

SL(Special Purpose)

FI(Financial)

Financial Master Data Integration

For display purposes only

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Why Implement PBC?

Enhanced fiscal management.

Replacement of the Compensationand Account Projection System(CAPS).

Provide salary commitmentinformation in the businesswarehouse. This will facilitateprojections in the Researcher portal(AIMS).

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Overview of PBC Process HR creates and manages positions.

As positions are filled and employee salarydistribution is established, the PBC commitmentprocessor will generate a commitment against therelevant cost element.

The commitment processor can be run daily,weekly, bi-weekly, or monthly.

A list of errors generated as a result of thecommitment process may be directed toresponsible parties via workflow for correction.

As actual payroll is posted, the commitment isreduced.

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Proposed PBC Requirements

Prior to holding this workshop,requirements were gathered fromprocess owners.

Process owners include John Shipley,John Beelke, and Lucia Anderson.

The following slides discuss therequirements identified for PBC.

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Staff Group CommitmentStaff Group CommitmentRequirementsRequirements

• Tenured/Tenure Track, Clinical, Research,Visiting, Non TT LT 50%, & Emeritus Faculty

• Limited Term and Continuing Lecturers• Post Docs, Interns, Residents, Fellowships• Clerical and Service• Management, Administrative/Supervisory,

Professional, Professional Assistant, Non-Exempt Professionals

• Graduate Staff, Residence Hall Counselors

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Staff Group CommitmentStaff Group CommitmentRequirementsRequirements

Open issue: Positive pay employees(employees that must report timethrough the time module to receive pay)may not be eligible for fundscommitments. Further research is beingconducted with SAP.

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Staff Groups Not Committed

Non Pays - Adjunct, Courtesy, Associate,Affiliate, Visiting Scholar, IPFW IU Faculty

Students

Temporary Clerical, Service, and A/Ppositions

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Pay Type CommitmentRequirements

Base Pay established on IT 08, Create BasePay.

Any other pay established on IT 14,Recurring Payments/Deductions, and IT 15,Additional Payments.

Recurring and additional payments couldinclude administrative supplements,special merit pay, overloads, etc.

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Funds CommitmentRequirement

All

SAP does not provide an option toencumber only certain funds.

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Positions CommitmentRequirement

Filled Only

Vacancies may be encumbered through PBCbut are considered out-of-scope for initialimplementation.

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Fringe Benefits CommitmentRequirement

Filled only, based on actual employeedeductions.

Open issue: We do not know how fringebenefits will be charged (central pool ordistribution account). This decision isneeded to determine impact on PBCprocess.

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FTE CommitmentRequirement

Committed amount should reflect theFTE of the position.

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Requirement for CommittedPeriods

Ability to commit across multiple fiscalyears (grant periods frequently cross fiscalyears).

Open issue: This is a planned SAPenhancement. Current PBC functionalityonly commits for fiscal year. SAP plans todeliver this functionality.

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Future Dated TransactionRequirements

Ability to establish commitments forplanned personnel actions such as salaryincreases, leaves or sabbaticals, EVPRschedule changes, etc.

Open issue: PBC will commit any futuredated personnel action established for theemployee. We must determine a strategyfor creating and managing future datedtransactions.

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Ad Hoc CommitmentRequirement

Ability to establish an ad-hoc commitmentto manage expenses for student ortemporary labor.

Open issue: PBC does not provide thisfunctionality.

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Cost Distribution Process

Three methods for distributing costs in SAP:

1. Each organizational unit (department) willprovide a default cost distribution. Thisdefault distribution may be inherited bythe employee holding the position linkedto the org unit.

2. Each assignment (employee-in-position)record may have a unique costdistribution. This distribution is capturedon IT 27, Create Cost Distribution.

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Cost Distribution Process cont.

Three methods for distributing costs in SAP:

3. Each positive pay employee may entertime and cost distribution through CATS(the time entry system).

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Cost Distribution Process cont.

We propose using IT 27 to capture costdistribution for all employees.

IT 27 will be used by PBC to forecast andcommit salary and fringe benefit expenses.

Open issue: Need the capability to updatedistribution data in decentralizedlocations.

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Cost Distribution Process cont.

Costs may be distributed per employee bycost center, fund, funds center, etc.

Each distribution line may be establishedfor a unique period of time.

Distribution may be established acrossfiscal years.

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IT 27 - Create Cost Distribution

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Roles & Responsibilities

Let’s take a few minutes to discussthe roles and responsibilities that weenvision with PBC.

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Cost Distribution Manager

Establishes cost distribution on IT 27 for allrelevant employees in their area.

Serves as the point of contact for any errorsgenerated as a result of the PBCcommitment run.

Corrects distribution errors in a timelymanner to ensure that payroll posting is notdelayed.

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Commitment RunAdministrator

Responsible for carrying out the runs for theautomatic commitment creation.

Any error messages that can not be workflowed to a responsible person are defaultedto the run administrator for manual routing.

Verifies that all workflows are operating.Will restart any failed workflows.

May customize the automatic commitmentcreation.

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Payroll Simulation Manager

Responsible for the correct running ofpayroll simulation and the test transferof the payroll results to Accounting.

May be responsible for identifying androuting cost distribution errors toresponsible parties.

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PBC Accounting Manager

Responsible for processing the messagesissued during the document creationprocess.

Procures the funds required if anavailability control issue.

Arrangements an account assignment if afinancing issue.

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To-Be Process SlideProcess to Create Salary Encumbrances

PBC Accounting ManagerCommitment Run Administrator Payroll Simulation ManagerCost Distribution Manager

Salary distribution established for all employees

on IT 27 via Manager Self Service or Workflow

Commitment Processor runs per

schedule . The processor forecasts salary and benefit

expenses from IT 27 cost distribution

Start

Commitment Established in FM & GM

Errors Identified from Processor Run ?

NO

Yes – Accounting Error

Fix Accounting Error Fix Payroll Error

Yes – Payroll ErrorYes – Distribution Error

Errors Corrected

End

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Thank you for Participating!

Sheryl GickOnePurdue1801 Kalberer RoadWest Lafayette, IN 47906(email: slg@purdue.edu)

HR LeadSue Davis

Celeste Bailey (BP)

e-RecruitmentAmy Clawson

Venkat Mondreti (BP)

OM, PBCSusan Newton

Theresa Hairell(( BP)

PAPeggy Jasper

Theresa Hairell(( BP)

PayrollRick Miller

Troy Markusson (BP)

Time MgmtGene Farmer

Eric Herron (BP)

Debbie Dillman-Crowell Sheryl Gick Greg Gick Jane WhiteSue Gibson

BenefitsGale Rhodes

Cindy Brinsmaid (BP)

Julie Gregory TBD (BP)