Account Reconciliation Manager Part 2 – Data Maps and Formats

Avatar

By
April 11th, 2012


This blog post is part of an Oracle Hyperion 11.1.2.2 series covering application highlights as well as a deeper look into different aspects of the new release.

Brief Review

Account Reconciliation Manager, “ARM” is a tool within the Financial Close Management Suite of products from Oracle Hyperion. It specifically is used to reconcile the final results in Hyperion Financial Management “HFM” back to the source systems such as Oracle EBS, JD Edwards, PeopleSoft, and SAP. In this installment of my blog series, we will look at the fundamental process of data mapping and formats. These are the basic requirements for using ARM.

Data Maps

In the traditional mapping process we think of a mapping relationship of many to one. As in a source system maps, we map many accounts to a summary level account for financial reporting. In the reconciliation process we go backwards to reconcile all the detail, as when we reconcile the traditional bank statement. ARM does the same process, but to accomplish that, we need to create the maps. Hence the true power of the tool is in these definitions. We use logical rules to facilitate this such as explicit, between, and like. Explicit values are exact matches, between sets a range of values, and like uses specific text strings and it supports wild card usage.

Data Loads

Data is loaded into ARM via using the data maps. The great advantage to ARM is that it uses the ERPI data adapter that is Oracle Hyperion Financial Data Quality Management Integration Adapter for Oracle Applications. This tool can import data from as Oracle EBS, JD Edwards, PeopleSoft, and SAP. Therefore one does not have to extract files and load them as in the past. It also imports Foreign Exchange “FX” rates. The data load is launched from the Manage Period dialog using the Data Load button. There are three stages to loading the data:

  1. Staging
  2. Load
  3. Post-Processing

Basically, Staging extracts the balances from the source system and stores the balances in a staging table. It also assigns a profile to the table (There will more on profiles in a later blog). The load process summarizes the balances by profile, balance type, and other data definitions. Then there is the Post-Processing, which performs the reconciliations and sets the status of the reconciliations such as Open with Reviewer, Closed, or Open with Preparer. Additionally there are the data load results such as a common error file, examples are unmapped accounts, invalid mappings and errors.

Formats

The formats used for ARM dictate the method of reconciliation. These formats are then assigned by system administrator to specific profiles/reconciliations. There are two basic methods that are configured in the formats:

  1. Account analysis
  2. Balance comparison

The account analysis method requires the preparer to provide a written explanation of the source system balance and usually provide a list of transactions that justify the balance. This is a common method used for prepaid accounts, accruals, and other accounts that do not come from any other sub-system. The balance comparison method requires the preparer to compare the subsystem to source system balance. This method is used commonly for accounts payable, receivable, and inventory. After the required method is run, the system calculates “unexplained differences”. Again, the parameters are set by the system administrator as to whether there are “0” unexplained differences or is there a range. The custom attributes can be set again by the system administrator as to who can edit the reconciliation and to what level.

Summary

In review, the basics of ARM are the Data Maps and Formats. These are the two key features that drive the reconciliations. From there we get into specific formats and profiles. I’ll cover the profiles in my next blog installment. Understanding the makeup of accounts and what drives a specific balance of an account is key to good reconciliations and then further, better audits. The business driver here is to avoid any unintentional errors and to provide a great audit trail for the auditors, both internal and external. The power of this tool allows more timely reconciliations that become a regular business process, rather than a reaction to a newly discovered problem. In a company with a large chart of accounts, this is invaluable.

This is the second post in a multi-part series about ARM. Upcoming blog posts will review the product features, setup, and will discuss how companies can leverage this tool to streamline the reconciliation process.

To make sure you don’t miss any of the Hyperion 11.1.2.2 blog posts, you can subscribe to receive our blog in your inbox. To do so, use the Subscribe feature  on the right column of the blog.topdownconsulting.com page.

 


Avatar

About TopDown Team

The TopDown Team includes members of TopDown Consulting who want to let the community know about webcasts, conferences, and other events. The team also conducts interviews on various EPM industry topics.

Leave a Reply

Your email address will not be published. Required fields are marked *