D76116gc10_sg.pdf

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om ฺ c ฺ e de clFinancial a Oracle Project r ui o G @ ent a i r Planning Create ud ka St11.1.2: a z dฺ Projects e this m e ham to us o (m nse a i r ce a i l k Student Guide Za rable d e sfe m n ham n-tra o M no

D76116GC10 Edition 1.0 September 2012 D78925

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Author

Copyright © 2012, Oracle and/or its affiliates. All rights reserved.

Theresa Songco

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Technical Contributors and Reviewers Liz Kasabian Shankar Viswanathan

This document contains proprietary information and is protected by copyright and other intellectual property laws. You may copy and print this document solely for your own use in an Oracle training course. The document may not be modified or altered in any way. Except where your use constitutes "fair use" under copyright law, you may not use, share, download, upload, copy, print, display, perform, reproduce, publish, license, post, transmit, or distribute this document in whole or in part without the express authorization of Oracle.

Manish Daga Ron Reiley Eleanor Salerno Amish Patel Ankit Rastogi Publisher Michael Sebastian Almeida

The information contained in this document is subject to change without notice. If you find any problems in the document, please report them in writing to: Oracle University, 500 Oracle Parkway, Redwood Shores, California 94065 USA. This document is not warranted to be error-free. Restricted Rights Notice If this documentation is delivered to the United States Government or anyone using the documentation on behalf of the United States Government, the following notice is applicable:

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U.S. GOVERNMENT RIGHTS The U.S. Government’s rights to use, modify, reproduce, release, perform, display, or disclose these training materials are restricted by the terms of the applicable Oracle license agreement and/or the applicable U.S. Government contract.

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Contents

1

Project Financial Planning Overview Objectives 1-2 Oracle Hyperion Planning 1-3 Planning Components 1-4 Product Integration 1-6 Planning Architecture 1-7 Client Tier 1-8 Middle Tier 1-9 Data Tier 1-10 External Services 1-11 Oracle Project Financial Planning 1-12 Project Financial Planning Features 1-13 Project Financial Planning Process 1-15 Step 1: Entering Project Details 1-16 Step 2: Planning for Expenses 1-17 Step 3: Planning for Revenue 1-18 Step 4: Reviewing Financials 1-19 Step 5: Managing Funding 1-20 Step 6: Submitting Plans for Approval 1-21 Project Financial Planning Business Scenario 1-22 Training Environment 1-24 Quiz 1-25 Summary 1-27 Practice 1-1 Through 1-4 1-28

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Administration Tasks Objectives 2-2 Lesson Agenda 2-3 Initial Implementation Tasks 2-4 Loading Required Dimensions and Members 2-6 Loading Data 2-7 Templates Overview 2-9 Extracting Template Files 2-10 Template Format 2-11 Data Load File Order 2-12

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Running the Import Utility 2-14 Setting Substitution Variables 2-15 Managing Smart Lists 2-17 Selecting User Variable Members 2-18 Lesson Agenda 2-20 Project Administration 2-21 Project Administration Task List Tasks 2-22 Project Assumptions 2-23 Setting Discount Rates and Taxes 2-24 Project Scoring 2-26 Investment Criteria 2-28 Defining Weightage for Criteria 2-30 Defining Weightage for Financial Goals 2-31 Defining Weightage for Subjective Groups 2-32 Defining Weightage for Subjective Goals 2-33 Overhead Assumptions 2-34 Overhead Assumptions: Indirect Costs 2-35 Overhead Assumptions: General and Administrative Costs 2-36 Allocation Basis Assumptions 2-37 Approval Settings 2-38 Key Performance Indicators 2-39 Intercompany Partners 2-40 Preparing Base Forecast Data 2-41 Lesson Agenda 2-43 Workforce Administration 2-44 Setting Workforce Global Rates 2-45 Importing Employees 2-47 Calculating Employee Compensation 2-48 Lesson Agenda 2-49 Capital Asset Administration 2-50 Importing Existing Assets 2-51 Asset Class and Asset Detail 2-52 Setting Capital Assumptions 2-54 Rolling Up Asset Expenses 2-56 Verifying Loaded Depreciation and Amortization 2-57 Calculating Asset Related Expenses 2-58 Quiz 2-59 Summary 2-61 Practice 2-1 Through 2-4 2-62

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3

Creating Projects Objectives 3-2 Determining a Project Type 3-3 Capital Projects 3-4 Types of Capital Projects 3-5 Contract Projects 3-6 Types of Contract Projects 3-7 Indirect Projects 3-8 Preparing Project Tasks 3-9 Entering New Project Details 3-10 Capital Projects: Adding Projects 3-11 Capital Projects: Adding Project Details 3-12 Capital Projects: Adding Capital Sub-Projects 3-13 Contract Projects: Adding Projects 3-14 Contract Projects: Adding Project Details 3-15 Indirect Projects: Adding Projects 3-17 Indirect Projects: Adding Project Details 3-18 Viewing Project Proposals 3-19 Capital Projects: Deleting Project Proposals 3-20 Contract Projects: Deleting Project Proposals 3-21 Indirect Projects: Deleting Project Proposals 3-22 Changing Project Status 3-23 Project Status Runtime Prompts 3-24 Reconciling Projects 3-25 Moving Projects 3-26 Quiz 3-27 Summary 3-30 Practice 3-1 Through 3-4 3-31

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Planning for Project Expenses Objectives 4-2 Expense Planning: Task Overview 4-3 Assigning and Calculating Labor Expenses 4-4 Adding Labor 4-5 Calculating Labor Expenses 4-8 Reviewing Labor Expenses 4-9 Assigning and Calculating Equipment Expenses 4-10 Adding Equipment 4-11 Calculating Equipment Expenses 4-13 Reviewing Equipment Expenses 4-14 Adding and Calculating Material and Other Requirements 4-15

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Adding and Calculating Material and Other Resources 4-16 Calculating Material and Other Expenses 4-18 Reviewing Material and Other Expenses 4-19 Entering Direct Project Expenses 4-20 Calculating Overhead Expenses 4-21 Reviewing Indirect and G&A Expenses 4-22 Reviewing Total Expenses 4-24 Quiz 4-25 Summary 4-27 Practice 4-1 Through 4-7 4-28 5

Planning for Contract Project Revenues Objectives 5-2 Revenue Planning: Task Overview 5-3 Entering Revenue Drivers for Cost Plus Projects 5-4 Adding and Removing Revenue Assumptions 5-6 Calculating Revenue for Cost Plus Projects 5-8 Quiz 5-9 Entering Revenue Drivers for Time and Materials Contract Projects 5-11 Viewing Standard Hourly Rates 5-12 Copying the Base Billing Rate 5-13 Calculating Labor Revenue 5-14 Calculating Material Revenue 5-15 Calculating Equipment Revenue 5-16 Calculating Total Project Revenue 5-17 Entering Revenue Drivers Based on Units Sold and Sales Price Per Unit 5-18 Entering Direct Project Revenue 5-20 Revenue Recognition 5-21 Summary 5-22 Practice 5-1 Through 5-2 5-23

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Reviewing Project Financials Objectives 6-2 Reviewing Project Financials Overview 6-3 Performing Calculations 6-4 Reviewing Project Financial Statements 6-5 Reviewing Project Metrics and KPIs 6-6 Reviewing Project Justification 6-8 Reviewing Project Score 6-9 Requesting Project Funding 6-10 Adding and Canceling Funding Requests 6-12

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Reviewing Allocated Funds 6-14 Quiz 6-15 Summary 6-18 Practices 6-1 Through 6-8 6-19 7

Managing Intercompany Projects Objectives 7-2 Managing Intercompany Projects 7-3 Limitations of Intercompany Projects 7-4 Tasks for Intercompany Projects 7-5 Calculating Cost Plus Intercompany Revenue 7-6 Calculating Project Data 7-7 Reviewing Intercompany Reconciliations 7-8 Summary 7-9 Practices 7-1 Through 7-9 7-10

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om ฺ c ฺ cle uide a r o tG @ 8 Managing Existing Projects ia den r a Objectives 8-2 ak s Stu z ฺ Managing Existing Projects 8-3 ed e thi m Process for Managing Existing Projects m 8-4us a h to 8-5 Managing Existing Projects Task List Tasks o e m ( ns Quiz 8-7 a i e r c Summary 8-9 aka ble li Z Practices ed 8-1sThrough era 8-8 8-10 f m anand Approving Projects r t h9am Reviewing o M non Objectives 9-2 Lesson Agenda 9-3 Process for Reviewing Projects 9-4 Calculating Departmental Financial Statements 9-5 Reviewing Project Proposals 9-6 Reviewing Existing Projects 9-7 Comparing Project Scores 9-8 Reviewing Project Performance 9-9 Reviewing Departmental Financial Performance 9-10 Reviewing the Impact on Financial Statements 9-11 Lesson Agenda 9-12 Project Financials Overview 9-13 Finance Analysis Task List 9-14 Running Rollups 9-15 Viewing the Financial Overview 9-16

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Financial Overview: Allocating Funds 9-17 Financial Overview: Changing Funding Status 9-19 Financial Overview: Reviewing the Impact on Financial Statements 9-20 Financial Overview: Reviewing Project KPIs 9-21 Performing Detailed Analysis 9-22 Reviewing Project Funding 9-23 Approving Projects 9-24 Submitting Plans for Approval 9-25 Reviewing Projects 9-27 Quiz 9-29 Summary 9-32 Practices 9-1 Through 9-4 9-33

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Analyzing Capital Assets and Equipment 11-6 Task Lists for Capital Asset Analysis and Planning 11-7 Reviewing Equipment 11-8 Reviewing Equipment Utilization 11-9 Asset Utilization Calculation Examples 11-10 Reviewing Equipment Requests Across Projects 11-11 Assigning Equipment to Projects 11-12 Requesting New Equipment 11-13 Recalculating Equipment Costs 11-14 Reviewing the Impact on Financial Statements 11-15 Capital Planning 11-16 Reviewing Existing Assets 11-17 Reviewing and Updating Asset-Related Expenses 11-19 Adding New Assets 11-20 Adding New Leased Assets 11-21 Reviewing Construction-In-Progress Assets 11-23 Calculating Asset-Related Expenses 11-24 Reviewing Asset Per Unit Cost Detail 11-25 Quiz 11-26 Summary 11-29 Practices 11-1 Through 11-7 11-30

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Project Financial Planning Overview

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Objectives After completing this lesson, you should be able to: • Describe Oracle Hyperion Planning (Planning) and its components • Identify the main components of the Planning architecture • Describe the features of Oracle Project Financial Planning (Project Financial Planning) • Describe the Project Financial Planning process s a h ) • Describe the business scenario om

eฺc deฺ l c ra Gui o @ ent a i r ka Stud a z dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 1 - 2

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Oracle Hyperion Planning Oracle Hyperion Planning: • Streamlines data entry through web and Excel interfaces • Provides a calculation engine to promote business modeling with complex business rules and allocations • Enables annotations at multiple levels to capture budget details • Accommodates potentially sophisticated budget review as )h processes m ฺco eฺ e l • Facilitates dynamic reporting by using Financial Reporting c id

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ra Gu o @ ent a i r ka Stud a z dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Oracle Hyperion n (Planning) is a budgeting and planning solution that provides m trPlanning a a h streamlined for entering data through web and Excel interfaces. Planning supports o onmethods M driver-based n plans that are based on global assumptions, such as interest rates and headcount,

and promotes modeling with complex business rules and allocations. It enables users to annotate and justify data at multiple levels to capture budget details. It enables decision makers and managers to collaborate with budget holders during potentially complex budget review processes, and provides the tools to create and publish dynamic financial reports by using Oracle Hyperion Financial Reporting (Financial Reporting).

Oracle Project Financial Planning 11.1.2: Create Projects 1 - 3

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Planning Components

Relational Database s

Planning User

Application Server

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu Essbase z ฺ Databases ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The application n provides the environment for running Planning applications. Oracle m trserver a a h WebLogic the application server provided with Planning. It facilitates user access to nono oServer n-in theis Planning M numericndata relational database and to numeric data in Oracle Essbase databases.

Planning requires a system database and a database for each deployed application. The Planning application database is used primarily to store the application’s definition.

Oracle Project Financial Planning 11.1.2: Create Projects 1 - 4

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The following information is stored in relational databases: • Smart lists • Approvals hierarchies • Approvals details • Annotations, comments in cells, and supporting details • Task lists • Preferences • Application setup • Data forms and data form validation rules • User variables • Non-numeric data The following information is stored in Essbase databases: • Smart lists numeric values • Numeric data • Currency calculation scripts • Substitution variables

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Product Integration •

• • •

EPM System: Profitability and Cost Management, Performance Scorecard, Strategic Finance, Financial Management, and FDM ERP systems: Oracle E-Business Suite, Oracle PeopleSoft Enterprise, and Oracle Fusion Applications Oracle Business Intelligence Suite, Enterprise Edition for dashboards and real-time reports s a h Data management applications: Oracle Data Integrator ) m o and ERP Integrator (FDM module) ฺ leฺc

e rac Guid o @ ent a i r ka Stud a z dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe mbe Planningm can integrated with the following products: n a a r t h -Enterprise Performance Management System (EPM System) product suite, M•o Oracle’s non • • •

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including Oracle Hyperion Profitability and Cost Management, Oracle Hyperion Performance Scorecard, Oracle Hyperion Strategic Finance, Oracle Hyperion Financial Management, and Oracle Hyperion Financial Data Quality Management (FDM). Enterprise resource planning (ERP) systems, including Oracle E-Business Suite, Oracle PeopleSoft Enterprise, and Oracle Fusion Applications Oracle Business Intelligence Suite, Enterprise Edition for interactive dashboards and realtime reports Data management applications, including Oracle Data Integrator and Oracle Hyperion Financial Data Quality Management ERP Integration Adapter for Oracle Applications (ERP Integrator; FDM module)

Oracle Project Financial Planning 11.1.2: Create Projects 1 - 6

Planning Architecture

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Client Tier Workspace: Planning, EPMA, Reporting and Analysis

Microsoft Office Integration Smart View

Administration Services Console, Essbase Studio

Web Analysis Studio and Reporting Studio Clients

Middle Tier

Application Server

Web Server

Services

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om ฺ c ฺ cle uide a r o tG @ ia den r a tu Databases Relational Databases ak Essbase S z ฺ is ed ERP thSystems External Oracle Data Integrator/ m e ERP Integrator Services ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe Planningm ism a multitier n application that combines the advantages of Essbase (a multidimensional a a r t h database) - a relational database to optimize performance and maintenance. o oand M n n Data Tier

The slide illustrates the client, middle, and data tiers as well as external services that integrate with Planning.

Oracle Project Financial Planning 11.1.2: Create Projects 1 - 7

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Client Tier •

• • •

Workspace for accessing the Planning web interface, creating and deploying classic and Performance Management Architect applications, and creating and publishing reports Smart View for entering Planning data in Excel Administration Services Console and Essbase Studio for modifying multidimensional outlines and calculation scripts s a h Reporting Studio for developing and running financial ) om ฺ c reports ฺ le

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ac uide r o G Workspace: t @ n a i Planning, Web Analysis Microsoft Office r ude Studio Administration a Performance and k Integration t Console, a Services S Management Reporting Studio z ฺ is Studio Smart View Architect, Reporting Clients ed e thEssbase m and Analysis ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The client tier n Oracle Enterprise Performance Management Workspace (Workspace), m contains a a r t h Oracle for Office (Smart View), Oracle Essbase Administration Services o Hyperion M on- Smart View Consolen(Administration Services Console), Oracle Essbase Studio (Essbase Studio), Hyperion Client Tier

Web Analysis Studio, and Oracle Hyperion Financial Reporting Studio (Reporting Studio). You access and manage Planning applications, Oracle Hyperion Enterprise Performance Management Architect (Performance Management Architect) applications, and reports in Workspace.

On the client tier, Planning administrators and users enter data, perform approvals tasks, manage users and security, launch business rules, copy versions, develop data forms, work with Financial Reporting, and perform other administrative tasks, such as updating Essbase outlines.

Oracle Project Financial Planning 11.1.2: Create Projects 1 - 8

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Middle Tier • • •

Application server for running applications Supported web servers for handling HTTP requests from Planning Services for Performance Management Architect, Essbase Studio, and Financial Reporting

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om ฺ c ฺ Middle Tier cle uide a r o tG @ ia den r a ak s Stu z ฺ d thi Application Server me WebeServer Services s m ha to u o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The middle tier n of Oracle WebLogic Server (the application server) for running Planning m tconsists a a r h applications, web servers for handling Hypertext Transfer Protocol (HTTP) requests o onsupported M from Planning, n and the required services for Performance Management Architect, Essbase Studio, and Financial Reporting.

The web server can be on a separate machine or on the same machine as the Planning application server. The web server enables you to access Planning applications from a web client through a browser. The web server uses HTTP as the communications protocol.

Oracle Project Financial Planning 11.1.2: Create Projects 1 - 9

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Data Tier •

•

Relational databases store data for Shared Services, Performance Management Architect, Calculation Manager, Reporting and Analysis, Administration Services, and Planning. Essbase databases store security, Planning data and metadata, and calculation scripts.

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om ฺ c ฺ cle uide a r Data Tier o tG @ ia den r a ak s Stu z ฺ ed e thi m Essbase Databases s Relational Databases m u a h o o et m ( nsand/or its affiliates. All rights reserved. a i e r Copyright © 2012, Oracle c aka ble li Z ed sfera m The datam tier consists n of the relational (non-numeric) and Essbase (numeric) databases. a a r t h -components require a relational database: o following The M non • • • • • •

Oracle Hyperion Shared Services Oracle Hyperion Performance Management Architect Oracle Hyperion Calculation Manager Oracle Hyperion Reporting and Analysis Oracle Essbase Administration Services Oracle Hyperion Planning

Oracle Project Financial Planning 11.1.2: Create Projects 1 - 10

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External Services • • •

Integration with Oracle and other systems Oracle Data Integrator and ERP Integrator for data and metadata integration ERP systems integration for drill-back capabilities

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ i Systems External Oracle Data Integrator/ed hERP t m e Services ERP Integrator ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe me and s To load m metadata data from Oracle and other systems into Planning applications, you can n a several traexternal services, including Oracle Data Integrator, ERP Integrator, and, for hwith work o n M classic applications, Outline Load Utility. no

Oracle Project Financial Planning 11.1.2: Create Projects 1 - 11

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Oracle Project Financial Planning

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Project Financial n bridges the gap between the detailed projects an organization m traPlanning a h undertakes o onand- the overall corporate impact/resources. It gives organizations a high-level M snapshot nof how their assets and resources are allocated, and then it monitors performance and provides information about return on investment.

Project Financial Planning addresses planning for the various tasks and resources for any project initiative with an underlying multidimensional database. Specific functionality was built to handle various scenarios and calculations that are typically used in Project Financial Planning.

Oracle Project Financial Planning 11.1.2: Create Projects 1 - 12

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Project Financial Planning Features Project Financial Planning features enable you to: • Perform planning for Indirect, Capital, and Contract projects • Import metadata and data (using the provided template files) • Perform expense planning at detail level or account level (labor, material, equipment) • Allocate workforce resources and capital assets to projects s ha • Calculate driver-based overheads for projects ) m ฺco eฺ • Perform different types of revenue planning andlerevenue recognition based on the type of Contract o projects rac G(Time uid @ ent and Material, Fixed Price, Cost Plus,riOther) a ud a project ka Sfrom t • View the impact on financial statements a z ฺ Loss, dand level or an entity level (Profit e this Cash Flow, key m e performance indicators(KPIs)) am us

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h to o e m ( nsand/or its affiliates. All rights reserved. a i e r Copyright © 2012, Oracle c aka ble li Z ed sfera m Project Financial n leverages core Planning features to enable you to accomplish the tasks m traPlanning a h listed slide. o on the M non

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Project Financial Planning Features •

• • • • •

Rank and approve projects based on a project score using financial measures and subjective measures (net present value, return on investment, payback, lifetime investment, risk assessment, strategic assessment, business assessment, organization missions) Perform planning for intercompany projects and reconcile them s a h Request funding ) m o Track the project approval flow eฺc deฺ l c ra Gui Use out-of-the-box reports o @ ent a i r Leverage from sample projects forka information tud technology

za is S ฺ d e e th m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The Project Financial m tran Planning features listed are a continuation from the previous slide. a h Mo non-

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Project Financial Planning Process 1

Enter project details.

2

Plan for expenses.

3

Plan for revenue (Contract projects only).

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4 om c ฺ le ideฺ c a or t Gu @ ia den r a ak s Stu z ฺ Submit the plan for ed e thi Review the financials. Managem funding. approvals. ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The Project Financial m tran Planning process includes the following steps: a h - details. project M1.o Enter non 6

2. 3. 4. 5. 6.

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Plan for expenses. Plan for revenue (Contract projects only). Review the financials. Manage funding. Submit the plan for approvals.

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Step 1: Entering Project Details Enter project details: • Determine the project type: Capital, Indirect, or Contract. • Enter any new project details, such as new project assumptions and supplemental information.

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om ฺ c ฺ cle uide1 a r o tG @ ia den r a ak s Stu z ฺ ed e thi m Enter project details. ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe by launching the Enter New Project Details task to open the New me anproject s You canm propose traform. You use the New Project Proposals form to gather basic project haProposals Project o n M information nosuch as type of project, project start and end dates, project location, and project manager. You can add properties to the application, as needed.

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Step 2: Planning for Expenses Expense planning: • Add labor. • Add equipment. • Add material and other resources. • Enter direct project expenses. • Apply overheads. • Review indirect and general and administrative (G&A) has ) m allocated expenses. o ฺc eฺ e l c • Review total expenses. ra uid 2

o tG @ ia den r a ak s Stu z ฺ ed e thi m Plan for expenses. m us a h o o et m ( nsand/or its affiliates. All rights reserved. a i e r Copyright © 2012, Oracle c aka ble li Z ed sfera m You usem the tasks in nthe Expense Planning task list folder to guide you through the process of a a r t h providing - about the expense components of a project. o odetails M n n

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Step 3: Planning for Revenue Revenue planning: • Enter revenue drivers: – Cost Plus – Time and Materials – Unit Price

•

Enter direct project revenue.

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om3ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ Plan for revenue ed e thi m (Contract projects only). m us a h o o et m ( nsand/or its affiliates. All rights reserved. a i e r Copyright © 2012, Oracle c aka ble li Z ed sfera m You usem the tasks in nthe Revenue Planning task list folder to guide you through the process of a a r t h entering about the revenue components for a Contract project. Revenue can be derived in o details M on-based differentnways on the category of the project (Cost Plus, Time and Material, and Unit Price). Note: Revenue planning can only be performed for projects classified as Contract projects.

Oracle Project Financial Planning 11.1.2: Create Projects 1 - 18

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Step 4: Reviewing Financials Review the project financials: • Calculate the financial statements. • Review the impact on the financial statements. • Review the project KPIs. • Review the project justification. • Review the project score.

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om ฺ c ฺ cle uide4 a r o tG @ ia den r a ak s Stu z ฺ ed e thi m Review the financials. ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe You usem them tasks in nthe Review Project Financials task list folder to review the project impact on a a r t h theocompany financial statements. M non These tasks are discussed in Lesson 9, “Reviewing and Approving Projects.”

Oracle Project Financial Planning 11.1.2: Create Projects 1 - 19

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Step 5: Managing Funding Review project funding: • Request the funding. • Review the allocated funds.

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Step 6: Submitting Plans for Approval Submit the plan for approval: • Promote the plan for approval. • Review the plan’s approval status.

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om6ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi Submit the plan for m s m approvals. ha to u o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Once you have all of the tasks for the project and you have reviewed the financial n m tcompleted a a r h statements o oand n- requested funding, you can promote your plan to another user for approval. You M use the n “Submit Plan for Approval” task list to promote your plan. Project approval is separate from plan approval. Consider the following layers of approval: • Labor request approval • Equipment request approval • Funding request approval • Project approval • Planning unit approval Labor, equipment, and funding requests are typically approved when the request is fulfilled. Project approval locks the project for editing, sets the status, and copies over project information to the Final and Forecast Final intersections. Plan approval goes through the planning unit review cycle.

Oracle Project Financial Planning 11.1.2: Create Projects 1 - 21

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Project Financial Planning Business Scenario ABC Training Corporation recently purchased Oracle’s EPM System and implemented Project Financial Planning and supporting tools. Project Financial Planning will enable the company to manage projects in line with its efforts to expand its business and track training development projects.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ Deliver end-user Build classrooms ed e thi Develop a Scope and m Track system. training. s m u a h o o et m ( nsand/or its affiliates. All rights reserved. a i e r Copyright © 2012, Oracle c aka ble li Z ed sfera m In line with nto expand its business and track training development projects, Project m its efforts a a r t h Financial - will enable ABC Training Corporation to manage the following projects: o oPlanning M n n • • •

Capital project: Build classrooms in a newly purchased training facility. Contract project: Deliver end-user training to Miller Corporation. Indirect project: Develop a Scope and Track system to monitor billing hours.

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The following stakeholders are involved in these projects: • Martha Jones, Program Manager Head Office: Responsible for creating, tracking, and managing projects required for the expansion. • Will Mott, Program Manager Human Resources: Responsible for tracking the utilization of employees across projects, review new hire requests, forecast work orders, and manage the schedule and use of resources. • Thomas Martin, Program Manager Asset Management: Responsible for tracking the utilization of assets across projects, manage the use of existing assets, approve asset requisitions, and reconcile Construction In Progress assets, new assets, leased assets with existing assets. • Mickey Smith, Application and Budget Administrator: Responsible for approving projects and budgets before they are submitted to Finance for funding.

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Training Environment

Planning and Product Components

Data Sources

Third-Party Software

Web Application and Web Servers

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Oracle Project Financial Planning 11.1.2: Create Projects 1 - 24

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Quiz Select three Planning components. a. Dimension Services b. Application Server c. Essbase databases d. Relational databases

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Quiz Revenue planning is required for all types of projects: a. True b. False

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Summary In this lesson, you should have learned how to: • Describe Oracle Hyperion Planning (Planning) and its components • Identify the main components of the Planning architecture • Describe the features of Oracle Project Financial Planning (Project Financial Planning) • Describe the Project Financial Planning process s a h ) • Describe the business scenario om

eฺc deฺ l c ra Gui o @ ent a i r ka Stud a z dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

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Practice 1-1 Through 1-4 The practice covers the following topics: • Starting EPM Services • Identifying Your Server Name • Preparing the Browser • Reviewing the Business Scenario, Users, and Roles

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Administration Tasks

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Objectives After completing this lesson, you should be able to: • Identify project administration tasks • Enter values for user variables • Set discount rates • Set investment criteria • Enter overhead assumptions s a • Select approval settings h ) m o • Set KPIs eฺc deฺ l c • Identify intercompany partners ra Gui o @ ent a i r • Set workforce and capital asset global rates d a

ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

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Lesson Agenda • • • •

Application Administration Project Administration Workforce Administration Capital Asset Administration

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Project Administration Workforce Administration Capital Asset Administration

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Initial Implementation Tasks 1. Install and configure Project Financial Planning. 2. Create and initialize the Project Financial Planning application. 3. Load the required dimensions and dimension members. 4. Refresh the application. 5. Load data. s 6. Set values for substitution variables. a h ) m 7. Manage Smart Lists. o ฺc eฺ e l c 8. Set user variables. ra uid

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o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe standpoint, you must perform the tasks listed on the slide prior to meAdministrator s From a m Global n tra Financial Planning. ha in Project working o n MInitial project, no workforce, and capital assumptions can be loaded using the utilities specified in the next sections. You can then manage these assumptions through the administration task lists covered in this lesson. Installing and Configuring Project Financial Planning See the Oracle Enterprise Performance Management System Installation and Configuration Guide.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 4

Creating and Initializing the Project Financial Planning Application

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To create a new Project Financial Planning application using Planning application administration, see the Oracle Hyperion Planning Administrator’s Guide. When using the Planning Application Wizard to create a Project Financial Planning application, select the Oracle Project Financial Planning application type. You can select to initialize the application with the IT Industry sample. Note the following when initializing Project Financial Planning: • If you are creating a basic Project Financial Planning application, select None. You will then be prompted to define the application calendar, set currency options, and set the customizable plan types, if required. • If you are creating an information technology (IT) industry-specific Project Financial Planning application, select Information Technology. You will not be prompted to define the application calendar, currency, and plan types. They will be set automatically with predefined settings. For details about creating, loading security for, and loading data for an IT industry–specific Project Financial Planning sample application, see Appendix B, “Sample Project: Information Technology” of the Oracle Project Financial Planning User’s Guide.

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Loading Required Dimensions and Members Load the required dimensions and members that correspond to the following metadata in your organization: • Entity • Job • Employee (Existing Employees) • Asset Class s • Asset Detail a h ) m • Existing Projects o c

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leฺ ideฺ c a or t Gu @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d feloading dimensions: me nwhen s Note them following tra You do not need to bring every asset into the application. Project Financial haAssetnClass: o • M no •

Planning enables you to group together similar assets. For example, if your organization is using 1,000 laptops, you do not need to add 1,000 members to the Asset Detail dimension. You can add just one Laptop member to the Asset Detail dimension and while loading the data corresponding to this asset, specify the Asset Units as 1000. Existing Projects: Ensure that you are loading the project under the correct project classification hierarchy. For example, before loading a project in Project Financial Planning, if it is determined to be a Contract project, it should be added under the Existing Contract Project hierarchy. Failing to do so may result in loss of functionality associated with the project.

Refreshing the Application After loading metadata (dimensions and members), you must refresh the application to synchronize it with Oracle Essbase.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 6

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Loading Data Before you import data, you must ensure that the members in the data load files are specified in the data load settings of your Project Financial Planning application.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe provides utilities that leverage the Outline Load Utility in Planning. me Planning s Project m Financial n a with the PFPImportUtility, you ensure that driver members are specified on trdata htoa loading Prior o n Mthe Planning no Data Load Administration page. You import the following Workforce, Capital Asset, and Project data into your application: • Assumptions - Capital Assumptions - Overhead Assumptions - Workforce Assumptions • Asset Depreciation and Amortization • Project Details - Existing Project - New Project • Project Actuals - Project Expenses - Project Revenues

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 7

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• • • • •

Employee Project Assignments Asset Project Assignments Project Material Requirements Existing Employee Data Existing Major Asset Data

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Templates Overview Project Financial Planning provides import utilities and sample template files that you can use to import data and metadata into your application.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe mExport Import m and nUtilities a a r t h o ExportPFPTemplates utility extracts the sample template files to a user-defined root folder. MThe non The PFPImportUtility imports the data and metadata into the Project Financial Planning application. Sample Template Files After extracting the sample template files, you use them to format your metadata and data in order to load it to a Project Financial Planning application. The template files are saved in a comma-separated values (CSV) file type. After preparing your metadata and data using the template files, you use the PFPImportUtility to load the information into your application.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 9

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Extracting Template Files

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To extract the sample template files: 1. Open a command prompt, and navigate to the Planning installation location. For example, if your Oracle instance is C:\Oracle, navigate to C:\Oracle\Middleware\user_projects\epmsystem1\Planning\planning1. 2. Enter ExportPFPTemplates.cmd , where is the directory where you want to extract the sample template files and is the language code of your Planning locale (for example, fr for French, en for English, or zh_cn for Simplified Chinese). Use lowercase letters for the language code. 3. Navigate to the and review its contents.

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Template Format This sample data row loads Laptop Lenovo T400 data to the Capex cube at Plan (Scenario), Working (Version), Laptop (Asset Class), Contract Project 1 (Project), USA (Entity), FY11 (Year), Jan (Period), Local (Currency).

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe template file contains the header records, which identify the member mine a sample s The firstm row n a values to load. The header records include the budget item (for example, trthe ha and properties o n MEntity, Asset no Class, Employee, or Project), the data load cube name, the kind of data to be

loaded (for example, project start and end dates, asset descriptions, or employee types), and the point of view (POV) to which you are loading data. The POV column contains information about the budget to which you are loading data (the scenario and version) and the artifacts that are associated with the data that you are loading (such as entity, position, employee, and so on).

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 11

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Data Load File Order When loading metadata and data using templates, consider the following: • Create and test CSV load files using a copy of the current application in a test environment prior to running them in your production environment. • Load metadata first, and then data using the order specified in the next section. s a h • Load data only to level 0 members, and then roll up the) om ฺ c data to parent members as required. ฺ cle uide a r • All dates should be in the format mm-dd-yyyy the CSV o fort G @ n file data. aria de

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ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m To ensure that nsource data loads correctly, metadata and data are loaded in this order by m tryour a a h o when n-you use the PFPImportUtility script: Mdefault o n • Smart List: SmartList.csv • • • • • • • • • • •

Asset Detail metadata: AssetMem.csv Employee metadata: EmployeeMem.csv Entity metadata: EntityMem.csv Project metadata: ProjectMem.csv Capital Assumptions: ImportGlobalCapitalAssumptions.csv Overhead Assumptions: ImportOverheadAssumptions.csv Workforce Assumptions: ImportWFPAssumptions_1.csv Asset Depreciation and Amortization data: Asset Depreciation and Ammortization.csv Existing Project data: ProjectDetails.csv New Project data: NewProjectDetails.csv Project Actual Expense data: ProjectActualsExpense.csv

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 12

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• • • • • • •

Project Actual Revenue data: ProjectActualsRevenue.csv Existing Employees’ Assignment to Projects: ImportEmployeeProjectAssignment.csv New Employees’ Assignment to Projects: ImportNewEmployeeProjectAssignment.csv Existing Asset Assignment to Projects: ImportProjectAssetAssignments.csv Material Requirements for Projects: ImportProjectMaterialRequirements.csv Existing Employee data: ImportExistingEmployees.csv Existing Major Asset data: ImportAssets.csv

Note: After loading metadata and before loading data, you must refresh your application to synchronize it with Oracle Essbase.

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Running the Import Utility

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m After creating load n files, you can run the PFPImportUtility.bat. Ensure the data load file has m the a a r t h - as the template file and that the format of the data load file is the same format osameoname Mthe n n template. as the provided To import the CSV data load files: 1. Navigate to the Planning installation location. For example, if your Oracle instance is C:\Oracle, navigate to C:\Oracle\Middleware\user_projects\epmsystem1\Planning\planning1. 2. Run PFPImportUtility.bat. 3. When prompted, enter the application, username, and the location for the root folder that contains the data load files, password, and language code. 4. When finished, open your Project Financial Planning application and verify that the data was loaded.

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Setting Substitution Variables Essbase Administration Console

Planning

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Substitution variables m tran are used in Project Financial Planning forms and in predefined reports. a h - the application, you must set values to the following substitution variables: o to accessing MPrior non • •

• • • • • • • •

LastYr: Set this to the previous year (for example, FY11). CurYr: Set this to the current year. For example, if the current year is 2012, set this to FY12. NextYear: Set this to the next year (for example, FY13). Yr2: Set this to the year after NextYear (for example, FY14). Yr3: Set this to the year after Yr2 (for example, FY15). Yr4: Set this to the year after Yr3, for example, FY16. ThisMonth: Set this to the current month. CurScenario: Set this to the current scenario (for example, Current). CurVersion: Set this to the current version (for example, Working). ActVersion: Set this to the actual version (for example, Prior FCST).

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ForVersion: Set this to the forecast version (for example, Prior FCST). PlanVersion: Set this to the working version (for example, Working).

Ensure that these values are existing dimension members in your application.

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You can use Essbase Administration Console to manage substitution variables.

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Managing Smart Lists You must update the following Smart Lists based on your business needs: • AssignmentLocation • Customer • FundingSource • PhysicalLocation s • ProjectCostLevel a h ) m • ProjectManager o ฺc eฺ e l c • SkillSet ra Guid o @ ent a • Grade i r ka Stud a z • Project Billing Level dฺ is

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e e th m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Smart Lists are n drop-down lists that users access from form cells. When you click cells m trcustom a a h - are associated with a Smart List (as a member property), you select items o members Mwhose non lists instead of entering data. from drop-down Note: You cannot type in cells that contain Smart Lists. Oracle recommends using the Project Financial Planning template and import/export utility delivered with the product to load Smart List values. After you load Smart Lists to the application, you manage the values using the Manage Smart Lists page. To create or work with Smart Lists: 1. In your application, select Administration, then Manage, and then Smart Lists. 2. Perform one of the following actions: - To create a Smart List, click Create, enter the name, and click OK. - To change a Smart List, select it and click Edit. - To delete Smart Lists, select them, and click Delete and OK. Deleting Smart Lists also deletes any associated mappings with dimension members and reporting applications. - Optional: Click Synchronize to synchronize Smart Lists between an application that uses Planning application administration and a reporting application. Note: Data cells can display only one Smart List. If multiple Smart Lists intersect at cells, set which one takes precedence. Oracle Project Financial Planning 11.1.2: Create Projects 2 - 17

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Selecting User Variable Members You select user variable members before accessing Project Financial Planning forms.

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Scenario View Version View Entity View Reporting Currency

To select user variable members: 1. In your application, select File, and then Preferences. 2. Click the Planning icon, and then select User Variable Options. If a user variable is set, an entry displays in Selected Member. 3. To select members, click the Select Members icon. 4. Select members from the left pane. 5. Click the Expand All icon or the Collapse All icon to expand or collapse the list.

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6. In Member Selection, perform one of the following actions: To select, click the Add icon. To remove, click the Remove icon. To remove all members, click the Remove All icon. 7. Click Save. 8. In User Variable Options, click OK.

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Lesson Agenda • • • •

Application Administration Project Administration Workforce Administration Capital Asset Administration

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Project Administration Workforce Administration Capital Asset Administration

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Project Administration Administrators perform the following tasks: • Setting discount rate and tax rates • Setting investment criteria • Entering overhead assumptions • Setting approval settings • Setting KPIs s a • Managing intercompany project partner relationships h ) m o • Preparing base forecast data ฺc ฺ

cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The Project Administration task list guides administrators through the project administration m tran a h - tasks and instructions to ensure that all relevant data is collected and o byonlisting Mprocess n calculated.

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Project Administration Task List Tasks

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assumptions. Set Investment Criteria: Enter investment criteria, including defining weight and reviewing criteria. Enter Overhead Assumptions: Enter overhead assumptions, including indirect cost and general and administrative cost assumptions. Approval Settings: Set the approval status for labor, asset, and funding requests. Import Projects: Import projects and refresh the application. Set KPIs for Projects: Set key performance indicators (KPIs) for projects. Intercompany: Add intercompany partners for a project and review intercompany reconciliations. Prepare Base Forecast Data: Prepare and clear base forecast data.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 22

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Project Assumptions Administrators enter the following assumptions at the entity level: • Discounting approach and related information used to derive the effective discount rate • Taxes applicable for the entity • Predefined rules for apportioning to projects the entity’s indirect and general and administrative expenses s a h ) • Setup requirements for intercompany projects m o eฺc deฺ l • Upper and lower limits for KPIs for project evaluation c ra Gui o • Rules for processing large amounts ofadata masse for t @ en n i e r forecasting, indirect expenses, and ud for the kacalculations t a S z Essbase database edฺ this

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m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The project administration process enables administrators to set up the required assumptions m tran a h be used for project planning and forecasting. Administrators can import o information n- that will Mand noinformation the setup from transactional systems or they can add it manually. The setup information is used as defaults for planning newly created projects or for forecasting existing projects. Assumptions provided here are entered at the entity level and, when a project is created for an entity, these assumptions are used as a starting point when you begin your planning.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 23

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Setting Discount Rates and Taxes Administrators provide the discount and tax rate information using the Set Discount Rate and Tax Rate task:

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Administrators nthe Set Discount Rate and Tax Rate task to open the Global Discount Rate m truse a a h -Assumptions form to define values for the following: o Tax Rate Mand non • •

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Tax Rate: Enter the rate at which taxes are paid for the given period. Discount Rate Approach: Select the approach for discounting your project’s cash flows to determine their NPV. There are two predefined approaches: Direct Discount Rate Approach, whereby you input the discount rate, and Capital Asset Pricing Model (CAPM), which considers the systematic risk or market risk of the project in the industry. Discount Rate: Enter the rate of return that could be earned on an investment in the financial markets with similar risk. Beta: Enter the expected rate of return and risk-free return. Riskless Rate: Enter the minimum return the business expects for an investment. Market Risk Premium: Enter the difference between the expected return on a market portfolio and the risk-free rate. Market risk premium is equal to the slope of the security market line (SML), a capital asset pricing model.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 24

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Debt Ratio: Enter the proportion of debt your company has relative to your assets. Cost of Borrowing: Enter the interest rate paid for funds that the business spends in total for goods or services including money, time, and labor.

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The Effective Discount Rate value is the interest rate used in discounted cash flow analysis to determine the present value of future cash flows. The value can be calculated either by Direct Discount Rate Approach or CAPM (Capital Asset Pricing Model). The effective discount rate drives the following accounts: • Discounting factor • Present value (PV) of cash flow • Net present value (NPV) The rates entered in the Global Discount Rate and Tax Rate Assumptions task are the default for all new projects created in Project Financial Planning if the rates are not defined at the project level. The details entered can be overridden later for a specific project.

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To set discount rates and taxes: 1. If task lists are not displayed, select View, then Task List, and then Task List. 2. In the Task List Tasks – All content area, expand Expand Project Administration. 3. For Set Discount Rate and Tax Rate, click the Launch Tasklist Wizard icon in the Action column. 4. Verify the Scenario and Version selections. 5. Select an Entity for the page dimension. 6. Click Go.

om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r ce a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 25

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Project Scoring Project scoring tracks a project’s performance against a predefined set of targets at the entity and project level and scores projects based on subjective and financial factors.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe mthese You canm use nscores to rank a project and analyze the performance of a project with a a r t h - projects and to a predefined set of limits. Financial scores are dependent on o tooother Mrespect n nmetrics and factors of the project, and are based on financial planning, while the financial

subjective scores are based on qualitative factors and responses to some predefined questions and their assessment by the entity head. You can review project scores for individual projects and across projects. Process for Project Scoring 1. The entity head defines the weightings for the components of the project score. These weightings are defined at the subjective and financial level, and the subjective weightings are further divided into components and subcomponents. Subjective scoring is based on the questions that are defined by the entity head and which pertain to the project’s performance.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 26

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2. After the project manager completes financial planning for the project, details about calculated financial metrics and parameters help in calculating the financial scores automatically. For subjective scores, the project manager must answer a set of predefined questions and, based on the responses, the entity head can determine the project’s subjective score. 3. The combination of financial and subjective scores is used to rank the project. Project ranking helps the entity, Finance, and corporate management to determine whether to approve of a project and fund it.

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Oracle Project Financial Planning 11.1.2: Create Projects 2 - 27

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Investment Criteria Administrators define investment criteria based on financial and strategic factors: • Weightage for criteria • Weightage for financial goals • Weightage for subjective groups • Weightage for subjective goals

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m These predefined m tranweights for scoring the projects are defined at the organization level, taking a h - the corporate strategic plan and goals. They help to determine the factors o consideration Minto nothenproject performance based on the parameters defined at corporate level. affecting

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 28

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Investment Criteria Administrators use the Set Investment Criteria task to open the Investment Criteria form:

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Administrators nthe Set Investment Criteria task to open the Investment Criteria form and m truse a a h o investment n- criteria in terms of detailed financial and strategic factors for scoring the Mdefine project n byogiving weights to them. The Investment Criteria contains four sections, which are discussed in the succeeding sections.

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Defining Weightage for Criteria

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Administrators n weightage for the following criteria: m trdefine a a h - Criteria enables weighting and evaluating based on the financial metrics and Mo• Financial non •

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factors of the project, and financial planning. Subject Criteria enables weighting and evaluating a project’s value beyond its financial (objective) merits alone. Examples of Subjective Criteria: how strongly a project expands a product line or contributes to meeting a company strategy. Investment Criteria allows projects to be evaluated against other projects on the basis of objective financial measures, such as its NPV or Benefit Cost Ratio, and subjective measures.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 30

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Defining Weightage for Financial Goals

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Administrators n weightage for the following financial goals: m trdefine a a h - Value (NPV) is an indicator of how much value an investment or project Present Mo• Net non •

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adds to an organization. It is calculated as a sum of all net cash flows over the years discounted to their present value. Return on Investment (ROI) is a performance measure used to evaluate the efficiency of an investment or to compare the efficiency of a number of different investments. To calculate ROI, the benefit (return) of an investment is divided by the cost of the investment; the result is expressed as a percentage or a ratio. Payback Period is the amount of time taken to break even on an investment. Benefit Cost Ratio (BCR) is an indicator of the overall value of a project, based on the ratio of the benefits of a project or proposal, expressed in monetary terms, relative to its costs, also expressed in monetary terms. Lifetime Investment (LI) is a KPI that measures the amount of a project’s funding over the project’s life.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 31

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Defining Weightage for Subjective Groups

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Subjective criteria m tranis divided into the following groups. Administrators define the weightage for a h -groups: Mtheofollowing non • • • •

Risk Assessment/Impact is used for scoring the project based on various risks, such as schedule, cost, resource, time to market. Strategic Assessment/Impact is used for assessing projects based on alignment to business unit or corporate strategy. Business Assessment/Impact is used for scoring based on revenue potential. Organization Missions is used to assess the project based on how it will help improve the process efficiency in the organization. Organization missions are commonly used in Indirect projects.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 32

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Defining Weightage for Subjective Goals

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m For subjective n the project planner must answer a set of predefined questions and, m tscores, a a r h -responses, the entity head can determine the project’s subjective score. o onothe Mbased n nis entered in the Define Weightage for Subjective Goals section of the Investment Weightage Criteria form.

The objective weights correspond to questions answered in the Detailed Justification task. The project administrator defines the subjective score for the corresponding questions. If no data is entered for a goali n the Define Weightage Subjective Goals section, that item is not included in project scoring. For example in the slide, there is no weightage entered for Resource and Time to Market. These goals are not included in project scoring even if the project planner enters responses to these questions in the Detailed Justification task.

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Overhead Assumptions You enter overhead assumptions for indirect expense, and general and administrative expenses by using the Enter Overhead Assumptions task:

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Overheads are necessary for the performance of a job or continued functioning of the n m trexpenses a a h o obutn-cannot be specifically attributed to a project. Examples of overhead expenses are Mbusiness n expenses, direct material expenses, and facilities allocation expenses. direct labor

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Overhead Assumptions: Indirect Costs Project Financial Planning provides the following indirect cost pool categories: • Labor Overhead • Engineering Overhead • Manufacturing Overhead • Material Overhead s • Information System Overhead a h ) m • Training Overhead o ฺc eฺ e l c • Fringe Overhead ra Guid o @ ent a • Common Overhead Pool i r ka Stud a z • Facilities Allocation dฺ is

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e e th m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe to a job but are difficult to assign to a project. Costs to a project meare necessary s Indirect m costs n a -based tra on the Indirect Cost Rate (ICR) and an ICR can be set for different types of hallocated are o n Mexpenses. noThe project administrator sets the indirect cost pool and allocation basis for each overhead line item, and then provides the ICR.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 35

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Overhead Assumptions: General and Administrative Costs General and administrative costs are: • Related to the entire company • Necessary to run the business but cannot be assigned to a specific job or project • Used to calculate the general and administrative cost rate (GACR) for each general and administrative cost pool Project Financial Planning provides one general and s a h administrative cost pool category: Corp G&A m)

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ฺco eฺ e l rac Guid o @ ent a i r ka Stud a z dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The project administrator m tran sets the general and administrative cost pool and allocation basis for a h -and administrative element, and then provides the GACR. o general Meach non

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 36

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Allocation Basis Assumptions Project Financial Planning provides the following allocation basis options for indirect cost assumptions and for general and administrative cost assumptions: • Total Direct Labor Cost • Total Direct Labor Hours • Total Direct Material Cost • Total Number of Employees s a h ) • Total Direct Costs m o eฺc deฺ l • Total Square Footage c ra Gui o @ ent • Total Machine Hours a i r ka Stud a • Value Added Cost Input z ฺ

ed e this m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 37

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Approval Settings You use the Approval Settings task to set whether the project can be approved directly without first obtaining the approval of the resource, asset, or finance manager:

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m If the auto approval m tranis set to Yes, the project can be approved without the resource, asset, or a h - approval. The project status is set to Approved. o manager’s Mfinance non f the auto approval is set to No, the resource, asset, or funding must be approved before the project can be approved.

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Key Performance Indicators Key performance indicators (KPIs) are high-level snapshots of a project based on specific predefined measures.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Administrators nthe Set KPIs for Projects task to define the upper and lower limits of KPIs m truse a a h the entity level. These limits will be used for tracking performance of projects oall projects n- attargets. Mfor nolevel with entity If projects are not within these limits, warnings will result. You set KPI limits to the following: • NPV • ROI • Payback Period (Years) • Benefit Cost Ratio • Lifetime Investment

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Intercompany Partners Administrators perform the following intercompany tasks: • Adding intercompany partner relationships • Rolling up intercompany transactions • Reconciling intercompany transactions

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Intercompany arise when the scope of the work requires multiple entities to work n m tpartnerships a a r h - to complete it. Intercompany partnerships consist of: Monothe project non • •

An owning entity, who assigns the project work and is responsible for the overall delivery of the project A service-provider entity, who completes the project work within the time line provided by the owning entity.

The service-provider entity charges the owning entity for the expense incurred on the project. The reimbursement for these expenses are considered intercompany revenue to the service provider and become an intercompany expense for the owning entity. At the corporate level, these intercompany charges are eliminated.

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Preparing Base Forecast Data The following business rules help you prepare base forecast data: PrepareDetailForecastBaseData, PrepareHighLevelForecastBaseData, and ClearForecastData.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe helps you prepare base forecast data by copying the actual data and me Planning s Project m Financial n a a to the trspecified hdata plan forecast version. Then, you can adjust created forecast version based o n Mon factors nolike pending work and resource availability. You can set the actual data to read-only by setting the start and end period or year for the scenario. Forecasting can occur at a high level or at the detailed assignment level of the project.

Note: Actual data must be loaded to the Actual scenario for “Direct Cost Input” and “Revenue Direct Input.” Preparing Forecast Data with Assignment Details The Preparing Forecast Data with Assignment Details task launches the PrepareDetailForecastBaseData business rule, which helps you prepare the data for forecasting project expenses and revenues at a detailed resource level.

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This business rule does the following: • The rule deletes existing data in the “Prior FCST” forecast version. • The rule copies data from the “Final” forecast version and moves it into the “Prior FCST” forecast version. • The rule copies detailed data (including employee, asset, and material assignments) from the “Final” actual version into the “FORECAST VERSION” version. • If data is not available in the “FORECAST VERSION” version, the rule copies the data with assignment details from the “Final” plan version into the “FORECAST VERSION” forecast version for the remainder of the budget cycle. • The rule copies assumptions from the “Prior FCST” forecast version to the “FORECAST VERSION” version. Preparing Forecast Data Without Assignment Details The Preparing Forecast Data without Assignment Details task launches the PrepareHighLevelForecastBaseData business rule, which helps you prepare the data for forecasting project expenses and revenues at a high level. Assignment details are not copied.

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This business rule does the following: • The rule deletes existing data in the “Prior FCST” forecast version. • The rule copies data from the “Final” forecast version and moves it into the “Prior FCST” forecast version. • The rule copies high-level data from the “Final” actual version into the “FORECAST VERSION” version. • If future data is not available in the “FORECAST VERSION” version, the rule copies highlevel data from the “Final” plan version into the “FORECAST VERSION” version for the remainder of the budget cycle. • The rule copies assumptions from the Prior FCST forecast version to the “FORECAST VERSION” version. This task launches the ClearForecastData business rule, which deletes the data from the selected Forecast Version.

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Lesson Agenda • • • •

Application Administration Project Administration Workforce Administration Capital Asset Administration

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The administration m trantasks discussed in this lesson are divided into the following sections: a h - Administration Mo• Application non • • •

Project Administration Workforce Administration Capital Asset Administration

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Workforce Administration The Workforce Administration task list enables administrators to: • Set global rates • Import employees • Calculate compensation

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Employee compensation m tran represents one of a company’s largest expenses and its most critical a h o oAsn-you prepare plans to help manage future expenses, you can use Workforce Mresource. n to manage and prioritize resources. Planning Administering workforce expenses involves planning or forecasting employee compensation expenses. The Workforce Administration task list includes tasks involved in this process: • Importing Employees: Track whether this process has completed. • Set Global Rates: Set and update workforce compensation assumptions (also called “global rates”) that drive various expense calculations and include such elements as salary, health care expenses, merit increases, taxes, and default working days, hours, and standard hourly rates • Calculate Compensation: Calculate and roll up compensation by Entity, Scenario, Version, and Year to aggregate expense totals

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Setting Workforce Global Rates Administrators use the Set Global Rates task under Workforce Administration to enter assumptions for the following: • Midpoint salary compensation assumptions • Employee benefits assumptions • Default working days and hours • Standard hourly labor rates s • Base billing rate a h ) m These assumptions are set at the entity or the No Entity level, o eฺc deฺ l but can be changed at the project level. c i ra

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o t Gu @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Global rates are n in various calculations to derive costs. These assumptions are often set m traused a h certain assumptions, can be changed at a lower level. Administrators set oa high olevel n- and,byforgrade, Matmidpoint nsalaries employee benefits assumptions, default working days and hours, and standard hourly rates.

The following forms are included in the Set Global Rates task under Workforce Administration: • Set Mid Salary Compensation Assumptions enables the administrator to enter midpoint salaries by grade. The form displays 13 predefined grade levels. Administrators can add, edit, and delete grade levels by using the Grade Smart List and Assumption Input member under Workforce Planning - Accounts of the Account dimension. • Set Employee Benefits Assumptions enables the administrator to enter benefit rates used to calculate for annual salary increases, merit increases, health care costs, and merit increases.

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Set Default Working Days and Hrs enables you to enter default number of hours per week and number of working days. Enter Standard Hrly Labor Rates enables you to enter standard hourly compensation for employee positions. Set Base Billing Rate enables you to set the different billing rates for the project. Three predefined levels allow you to bill based on varied levels. Administrators can add, edit, delete billing levels.

Note: At the project level, Project managers can only override values to the billing rates. Values for Mid Salary Compensation Assumptions, Employee Benefit Assumptions, Default Working Days and Hrs, and Standard Hrly Labor Rates must be set by Project Administrators at the entity level. If the assumptions are set at the entity level, they will be used for calculations; otherwise, the assumptions set for the organization will be used.

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Importing Employees You must import employee metadata and data to integrate Workforce Planning with Project Financial Planning.

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om ฺ c ฺ cle uide a r o tG @ ia den r a k Stufor the Employee Workforce primarily requires you to import amembers z ฺ and Job dimensions. ed e this m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Employee Dimension am -tran h o perform detailed employee planning in Project Financial Planning, you must upload existing MTo noninto employees Project Financial Planning, including the existing employee structure and employee properties account members such as Grade or Salary. Job Dimension To perform high-level employee planning in Project Financial Planning with the Job dimension, ensure that all the positions present in the organization are present in Project Financial Planning as members of Job dimension. When importing the data for existing employees from the company’s HRMS, the data should be imported at the correct intersection of the Job and Employee. For more information on loading metadata and data, see “Initial Implementation Tasks” in this lesson.

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Calculating Employee Compensation You complete the Calculate Compensation task to view the updated total compensation for an entity.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe mCalculate You runm the n Total Employee Compensation business rule associated with the a a r t h to calculate employee compensation by entity, based on expense o oCompensation n- execute thetask MCalculate n can data. You Calculate Total Employee Compensation business rule either in a batch process after loading employee data from the source HRMS or after you plan resources for an entity. To calculate employee compensation: 1. Under the Workforce Administration task list, select Calculate Compensation. 2. Click the Launch button to run the Calculate Total Employee Compensation business rule. 3. In the Calculate Total Employee Compensation runtime prompt, enter the required values. 4. Click Launch.

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Lesson Agenda • • • •

Application Administration Project Administration Workforce Administration Capital Asset Administration

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The administration m trantasks discussed in this lesson are divided into the following sections: a h - Administration Mo• Application non • • •

Project Administration Workforce Administration Capital Asset Administration

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Capital Asset Administration The Capital Administration task list enables administrators to: • Import existing assets • Set capital assumptions • Run rollup rules • Verify loaded depreciation and amortization • Calculate asset-related expenses

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Administering n assets begins with setting several company assumptions for capital m tcapital a a r h o including n- depreciation methods, useful life of assets, depreciation conventions, and Massets noassumptions. other key

Oracle recommends that you update existing asset category and asset detail data (dimensions and data) before preparing financial plans, either Plan or Forecast. After you update the two dimensions and refresh the application, you can execute asset-related expense calculations to consolidate up-to-date asset-related expenses for plans or forecasts.

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Importing Existing Assets Capital planning typically starts by loading existing major assets from your company’s source fixed asset system.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m To facilitate assigning m tran and expensing existing assets to projects, Project Financial Planning a h o oimport n- utilities and sample template files that you can use to import data and metadata Mprovides n application. into your Note the following when importing existing assets: • Oracle recommends loading data from external systems for future periods because depreciation and amortization for existing assets are typically calculated for future periods in the source system (for example, the fixed asset ledger). To accurately reflect the impact of purchases and retirements on depreciation and amortization, you must regularly refresh this data from the source system. • You must regularly maintain the Asset Detail dimension to reflect newly-acquired assets and remove retired assets. • Oracle recommends that you not load every asset from your fixed asset system into Project Financial Planning. You need load only those assets that will be used in projects. • After updating capital asset information, you synchronize the application with Oracle Essbase by refreshing the application.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 51

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Asset Class and Asset Detail

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Asset Class am -tran h o n dimension details the different categories of assets that a company owns. You MThe Asset noClass update the following asset class members: • Tangible assets (furniture and fixtures, machinery and equipment, computers, and so on) • Intangible assets (leasehold improvements, software rights, goodwill). The Asset Class dimension contains a list of standard equipment that you may request for use on projects. When you request for resources, you can only specify the type of equipment needed for the project. The Standard Equipment member provides a concise list of material assets that are requested for use on a project. Other types of assets should not be included.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 52

You must add Standard Equipment to the application before using Project Financial Planning and that you update Standard Equipment data (dimensions and data) before you prepare financial plans, either Plan or Forecast.

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Asset Detail You can perform detailed asset planning in Project Financial Planning. The process involves uploading existing assets into Project Financial Planning, including asset properties (Account members) such as Useful Life, In Service Date, Capacity, and Cost should Oracle recommends that you update existing major equipment information (dimensions and data) before preparing financial plans, either Plan or Forecast. You load asset details by using a data file with the same format as the AssetMem.csv template load file. For more information on loading metadata and data, see “Initial Implementation Tasks” in this lesson.

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Setting Capital Assumptions Administrators use the Set Capital Assumptions task under Capital Administration to enter rates for the following: • Tangible assets • Intangible assets • Equipment If no assumptions are set at the entity level, global assumptions will be used in calculations. as

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)h m ฺco eฺ e l rac Guid o @ ent a i r ka Stud a z dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Administrators nthe Set Capital Assumptions task to work with asset information, set drivers m truse a a h assumptions for each asset class (for example, buildings or machinery) oestablishing Mby on- global or for allntangible or intangible assets.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 54

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Setting Capital Assumptions Set drivers by entering global assumptions for each asset class (for example, buildings or machinery) or for all tangible or intangible assets. You can set these default assumptions at the entity level or at the “No Entity” (global) level. • Useful life of assets • Depreciation methods • Depreciation conventions s a h ) • Amortization methods m o eฺc deฺ l • Taxes (%) c ra Gui o • Insurance expenses (%) @ ent a i r d a • Repairs and maintenance expenses zak (%)Stu

dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The standard nfor equipment that you set in this form are used to calculate the cost of m rates a a r t h - to a project. The standard rate is multiplied by the units requested by the o nusage Mequipment project.no

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 55

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Rolling Up Asset Expenses Before reviewing asset expenses, you must launch the business rule to consolidate the data in the assets hierarchy.

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Under the Capital Administration task list, select Run Rollup Rules. Click the Launch button. Enter the required runtime prompt values. Click Launch.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 56

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Verifying Loaded Depreciation and Amortization You view the loaded depreciation and amortization values using the Verifying Loaded Depreciation and Amortization task.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m After loading rolling n up capital asset expenses, you verify existing assets for each period m and a a r t h o entityobyn-launching the Verify Loaded Depreciation and Amortization on Existing Assets Mand n task enables you to review depreciation and amortization amounts by period for task. This existing tangible assets.

To verify loaded depreciation and amortization: 1. Under the Capital Administration task list, select “Verify Loaded Depreciation and Amortization.” 2. Review the Verify Loaded Depreciation and Amortization form.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 57

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Calculating Asset Related Expenses To view the total expenses for asset related expenses, launch the Calculate Asset Related Expenses business rule from the Calculate Asset Related Expenses task.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The Calculate n Related Expenses task enables asset managers to calculate the asset m tAsset a a r h o expenses n- (Taxes, Insurance, Repairs and Maintenance) based on the assumptions Mrelated definednatothe entity level for the asset and asset class combination. Taxes, Insurance, Repairs, and Maintenance expense are entered as a percentage of the asset value. The rates are defined on a yearly basis.

To calculate asset related expenses: 1. Under the Capital Administration task list, select Calculate Asset Related Expenses. 2. Click the Launch button. 3. Enter the required values in the runtime prompt. 4. Click Launch.

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 58

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Quiz Administrators enter which of the following assumptions at the entity level and when a project is created for an entity? a. Discounting process and factors b. Predefined debt ceilings at the project level c. Average cost of revenue d. Taxes applicable for the entity e. Predefined rules for apportioning to projects the entity’s has indirect and general and administrative expenses om)

eฺc deฺ l c ra Gui o @ ent a i r ka Stud a z dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Answer: a, b, m td,raen a h Mo non-

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 59

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Quiz Only administrators can set up intercompany partner relationships. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 2 - 60

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Summary In this lesson, you should have learned how to: • Identify project administration tasks • Enter values for user variables • Set discount rates • Set investment criteria • Enter overhead assumptions s a • Select approval settings h ) m o • Set KPIs eฺc deฺ l c • Identify intercompany partners ra Gui o @ ent a i r • Set workforce and capital asset global rates d a

ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 2 - 61

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Practice 2-1 Through 2-4 The practice covers the following topics: • Accessing Project Financial Planning from Workspace • Setting User Variable Options • Reviewing Project Administration Tasks • Accessing Essbase Administration Services Console

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Creating Projects

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Objectives After completing this lesson, you should be able to: • Describe project types • Create projects • Prepare for project task lists and tasks • Enter new project details

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Oracle Project Financial Planning 11.1.2: Create Projects 3 - 2

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Determining a Project Type Project Financial Planning enables you to propose new contracts for the following types of projects: • Capital • Contract • Indirect

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Capital Projects Capital projects are long-term and capital-intensive, resulting in the creation of a new company asset.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m A Capital project m traisna long-term investment project undertaken for construction of a capital asset a h - bridges, and roads). o as obuildings, M(such n n If a project has a classification of Capital, you can perform only expense budgeting for the project. Project Financial Planning tracks the incurred expenses for a Capital project as Construction in Progress (CIP) on the Balance Sheet while the assets are being developed. Once a Capital project is placed in service and the assets are ready, the CIP assets must be reconciled with existing assets.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 4

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Types of Capital Projects Project Financial Planning supports two types of capital projects:

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om ฺ c ฺ cle uProjects ide Single-Asset Capital Projects Multiple-Assetra Capital o G t @ n a i ar tude k a dฺz this S e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m When creating nCapital projects, you must select a project type, also referred to as a m trnew a a h o Project n- Asset property: MCapital o n • Single-Asset Capital projects are projects that consist of building one Capital asset •

using different resources. Multiple-Asset Capital Projects are projects that consist of building a group of assets called sub-projects. The parent project is used to track the budget for all of the subprojects.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 5

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Contract Projects A Contract project is work performed for a customer and the customer reimburses the company.

Expenses

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om ฺ c ฺ cle uide a r o tG @ n Revenue ria e d a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m A Contract project m tranis work performed for and reimbursed by a customer. Contract projects a h and revenue based on an underlying contract. The Contract project o oboth n- expenses Mgenerate n revenue, expenses, and billing can be for services performed and reimbursed by a customer.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 6

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Types of Contract Projects

Time and Materials

Cost Plus

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hours of work performed, for asset expenses, for any direct expenses incurred, and for materials purchased during project delivery. Examples of Time and Materials arrangements are typically found in the construction industry, for contractors, and for consulting firms. Cost Plus: An agreement to pay a company for a job based on the expenses required to complete the job (for example, materials and labor), plus an added payment (or margin). You can set different Cost Plus margins for different expenses (for example, set a different margin for labor, materials, and equipment). Fixed Price: A project billing type whereby the customer is charged a set negotiated price for the work performed on the contract (for example, sales revenue with a specified value of $200,000). This contract type places upon the contractor maximum risk and full responsibility for all costs and resulting profit or loss. Other: A project billing type that can be used for complex contract terms. For example, a customer may be charged a fixed price for some services delivered as part of a project while they may also be charged time and material or a markup on expenses.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 7

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Indirect Projects Indirect projects are also known as administrative projects.

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om ฺ c ฺ cle uide a r o tG @ n ia revenue. e They have a cost impact but do not generate r d a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe known as administrative projects and have a cost impact but do not me arensalso Indirect m projects tra For example, you create a project for your IT department to create a ha revenue. generate o n Msolution/portal no for the Human Resources team to track personal details of employees.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 8

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Preparing Project Tasks As a Project Manager, you perform the following tasks to create projects: 1. Enter new project details. 2. Plan for expenses. 3. Plan for revenue for contract projects. 4. Review project financials. s 5. Manage funding. a h ) m 6. Submit project for approval. o c

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leฺ ideฺ c a or t Gu @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe the following tasks to create projects: me nperform s Project m managers ra and enter any new project details, such as new project assumptions and haCreaten-atproject o 1. M no 2.

3. 4.

5. 6.

supplemental information. Perform expense planning, such as adding labor resources, project equipment, material and other requirements, entering direct project expenses, applying overheads to the project, reviewing indirect and general and administrative allocated expenses, and reviewing total expenses. For Contract projects only, perform revenue planning, such as entering revenue drivers and entering direct project revenue. Review the project’s financials, such as calculating financial statements and reviewing the project’s impact on financial statements, reviewing project KPIs, providing a detailed project justification, and reviewing the project score. Request project funding and review allocated funds. Submit the project for approval.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 9

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Entering New Project Details Enter New Project Details for Capital Projects

Enter New Project Details for Contract Projects

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe by project type. To create a new project, you launch the Enter New meare grouped s Project m tasks n a under the project type that you want to propose. trtask ha Details Project o n M no Enter New Project Details for Indirect Projects

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 10

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Capital Projects: Adding Projects

Right-click a row and select Add Project.

Select to add Capital or sub-projects.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m By selecting the n New Project Details task for Capital projects, you launch the New Project m traEnter a h form. o o–nCapital MProposals n To add a Capital project in the form, right-click a row and select Add Project and select one of the following: • Add Capital Project: To create a parent single-asset or multiple-asset project. • Add Capital Sub Project: To create a sub-project associated with a parent multipleasset project.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 11

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Capital Projects: Adding Project Details You add project details in the Add Project runtime prompt:

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m You enter the n information in the Add Project runtime prompt: m tfollowing a a r h -Enter a name for the project. Mo• Name: non • • • • •

Description: (Optional) Enter a description for the project to describe its purpose. Capital Project Asset: Select Single Asset or Multiple Asset Project Start Date and Project End Date: Enter the start and end dates for the project. Project Location: Select from a predefined list of locations. Project Manager: Select from a predefined list of managers.

The predefined list of locations and managers are based on Smart Lists prepared by the project administrator.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 12

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Capital Projects: Adding Capital Sub-Projects You enter sub-project details for multiple-asset Capital projects in the Add Sub Project runtime prompt:

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select a Base CPx base project. Name: Enter a name for the project. Description: (Optional) Enter a description for the sub-project to describe its purpose. Project Start Date and Project End Date: Enter the start and end dates for the subproject. If you do not specify a start and end date for the sub-project, the values default to the base project’s start and end dates.

The base project is the parent Capital project that contains the project properties, including Start Date, End Date, and so on. You should not use the base project for budgeting expenses. When planning expenses for each asset, you should use the corresponding sub-project.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 13

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Contract Projects: Adding Projects

Right-click a row and select Add Contract Project .

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Oracle Project Financial Planning 11.1.2: Create Projects 3 - 14

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Contract Projects: Adding Project Details You add project details in the Add Contract Project runtime prompt:

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Description: (Optional) Enter a description for the project to describe its purpose. Project Start Date and Project End Date: Enter the start and end dates for the project. Project Type: Select Time and Material, Cost Plus, Fixed Price, or Other. Revenue Cash Flow Incidence: Select how cash will be collected from revenues: Before 2 Months, Before 1 Month, Same Month, Next Month, After 2 Months, After 3 Months, or After 4 Months. The selection directly impacts the cash flow statement. If the same month is selected, the cash flow statement will show an inflow of cash from customers in the amount of the contract revenue in the same period. If the next month is selected, the cash flow statement will show an inflow of cash from the customer with a one month lag. Two months will be a two month lag, and so on.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 15

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•

Revenue Recognition: Select when revenue will be recognized: Monthly, Quarterly, SemiAnnual, After Completion, or When Billed. The default, Monthly, recognizes revenue in the month the work is performed. If Quarterly is selected, the revenue is recognized in the last month of each contract quarter. If SemiAnnual is selected, revenue is recognized in the sixth and twelfth month of the contract. If After Completion is selected, revenue is recognized after the last month of the contract. If revenue can only be recognized when a milestone is reached or there is no predefined time frame, select When Billed.

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Oracle Project Financial Planning 11.1.2: Create Projects 3 - 16

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Indirect Projects: Adding Projects

Right-click a row and select Add Indirect Project .

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m By selecting the n New Project Details task for Indirect projects, you launch the New m traEnter a h - – Indirect form. To add an Indirect project, in the form, right-click a row and o Proposals MProject nonIndirect Project. select Add

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 17

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Indirect Projects: Adding Project Details You add project details in the Add Indirect Project runtime prompt:

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Description: (Optional) Enter a description for the project to describe its purpose. Project Category: Select Annual by Fiscal Year if a project must be annually closed out, justified, or approved. Select Multi-Year if the project can continue year after year. Project Start Date and Project End Date: Enter the start and end dates for the project.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 18

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Viewing Project Proposals View proposed projects by selecting the Review Project Proposals task:

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m After creating n you view them by selecting the Review Project Proposals task under the m projects, a a r t h task list folder. You can edit project details on this form by double-clicking a o Projects n- updating MReview noand white cell the information.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 19

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Capital Projects: Deleting Project Proposals Right-click a project and select Delete Project.

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Delete Capital Project Delete Sub Capital Project

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Contract Projects: Deleting Project Proposals

Right-click a project and select Delete Contract Project.

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Oracle Project Financial Planning 11.1.2: Create Projects 3 - 21

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Indirect Projects: Deleting Project Proposals

Right-click a project and select Delete Indirect Project.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m To delete Indirect in the New Project Proposals – Indirect form, right-click a project n m traprojects, a h - Indirect Project. o selectoDelete Mand n n

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 22

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Changing Project Status In the New Project Proposals form for Capital, Contract, and Indirect projects, right-click a row and select Change Project Status. Right-click a project and select Change Project Status.

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om ฺ c ฺ cle uide a r G Then, select a newoprojecttstatus. @ n a i ar tude k a dฺz this S e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe from plan approval. Approving the project sets the status of the me isnseparate s Project m approval tra and locks the project for editing. You cannot make any changes to hato Approved project o n Mapproved noprojects. The approved project will be copied to current scenario Final and to the Forecast Final intersections. To start updating the project status, right-click a project and select Change Project Status. Then, select Approve Project, Disapprove Project, or Put Project on Hold. The project status must be changed by the approving authority before promoting the project through the Approvals process. Note: You can change the project status if you have access permissions for this task.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 23

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Project Status Runtime Prompts

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Oracle Project Financial Planning 11.1.2: Create Projects 3 - 24

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Reconciling Projects Reconciling a project moves the new project to an existing project: For Capital projects, right-click and select Reconcile Capital Project. Enter and verify the source (proposed) project and existing (imported) projects in the Reconcile Project runtime prompt.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m When you reconcile m tran projects, the data for the source project is moved to an existing project in a h then the source project is deleted from the entity. For example, you osameoentity, n- and Mthe n projects reconcile to assign a true project number (existing project) to a temporary project. This moves the data from the (source) temporary project to the existing (destination) project, and then deletes the source project. To reconcile Capital, Contract, and Indirect projects in their corresponding New Projects Proposals forms, right-click a project and select Reconcile Capital Project. Then, enter and verify the source and destination projects.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 25

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Moving Projects Right-click and select Move Projects.

Select the project, existing version, and destination version in the Move Projects runtime prompt.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fefrom one version to another. For example, from Working to Final. mea project s You canm move n traprojects, the selected projects will be deleted from the source version and hayou move When o n Mmoved ntoothe destination version.

For example, in a use case scenario, you can move projects with a status of On-hold or Unapproved from the Working version so that the entity-level financials will reflect only those projects that are Proposed or Approved. Note: You must have rights to move a project to perform this task.

Oracle Project Financial Planning 11.1.2: Create Projects 3 - 26

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Quiz As a Project Manager, you perform which of the following tasks to create projects? a. Enter existing project details. b. Plan for expenses. c. Plan for revenue for contract projects. d. Submit plan for approval.

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Oracle Project Financial Planning 11.1.2: Create Projects 3 - 27

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Quiz When you reconcile a project, you transfer it from one version to another. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 3 - 28

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Quiz You enter sub-project details for multiple-asset Capital projects. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 3 - 29

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Summary In this lesson, you should have learned how to: • Describe project types • Create projects • Prepare for project task lists and tasks • Enter new project details

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Oracle Project Financial Planning 11.1.2: Create Projects 3 - 30

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Practice 3-1 Through 3-4 The practice covers the following topics: • Capital Project: Furnishing Classrooms • Contract Project: Delivering Training to Miller Corporation • Contract Project: Developing Scope and Track • Indirect Project: Training for Scope and Track

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Oracle Project Financial Planning 11.1.2: Create Projects 3 - 31

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Planning for Project Expenses

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Objectives After completing this lesson, you should be able to: • Assign and calculate labor expenses • Assign and calculate equipment expenses • Assign and calculate material and other requirements • Enter direct project expenses • Calculate overhead expenses s a • Review indirect and G&A expenses h ) m o • Review total project expenses ฺc ฺ

cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 2

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Expense Planning: Task Overview You use the Expense Planning task list to guide you through the process of providing details about the expense components of a project, including the following: • Add labor • Add equipment • Add material and other resources • Enter direct project expenses s a h ) • Apply overheads m o ฺc eฺ e(G&A) l • Review indirect and general and administrative c ra Guid o allocated expenses @ ent a i r d a • Review total expenses zak Stu

dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 3

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Assigning and Calculating Labor Expenses When assigning labor, you perform the following tasks: • Add labor • Calculate labor expenses • Review labor expenses

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Oracle Project Financial Planning 11.1.2: Create Projects 4 - 4

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Adding Labor You add labor to projects by using the Add Labor task.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe me ornsdecrease You canm increase labor hours, add more resources to the project, change the a a r t h - frame, and so on. Changes made here are reflected in the revised Total Labor o ontime Massignment n for the project. Expense To assign labor resources to a project: 1. Navigate to one of the new project proposal task lists. 2. Expand Expense Planning, and then expand Add Labor. 3. Under the Add Labor task list folder, select Add Labor. 4. Review the Labor Assignment Details form. 5. Right-click a row and select Add Labor Assignment.

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Oracle Project Financial Planning 11.1.2: Create Projects 4 - 5

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6. Enter the following information in the Add Labor Resource runtime prompt: - Select Job: Select the type of job required for the project from a predefined list of jobs. - Enter Headcount: Enter the number of resources needed to accomplish the work. If more than 1 is entered, the hours are calculated. - Enter Skill Sets: Select the skills needed to perform the job from a predefined list of skills. This field is informational and does not impact the labor calculations. You can customize this field by adding new members to the Smart List. Adding additional values to the Smart List will not impact the business rules. - Assign for Project Duration (Y/N): The default is Yes. Select Yes if the resource will be assigned for the duration of the project. If Yes is selected, you do not need to enter the assignment start and end dates. The rule will automatically take the project start and end dates. Select No if the resource will not be assigned for the duration of the project. If No is selected, you must enter the assignment start and end dates for the resource. If a resource is used sporadically, enter the resource start and end dates for the first period of the project to add the resource line item to the form. Then expand the year in the form to add additional hours for the resource by period. - Assignment Start Date/Assignment End Date: If the resource will not be assigned for the project duration, you must enter the start and end dates. If the start and end dates are not completed, the rule assumes the resource will be assigned for the duration of the project. - Allocation Percentage: (For Capital and Indirect projects only) Enter the percentage of time a labor resource is allocated to a project. The Allocation Percentage drives the labor expense of that resource to a project. - Enter Labor Hours per Headcount: (For Capital and Indirect projects only) If requesting more than one headcount, enter the number of hours per headcount for the calculation. - Onsite Labor Hours: (For Contract projects only) Enter the number of hours the resource will perform project work onsite. Onsite labor hours is used in the Contract revenue calculation. - Offsite Labor Hours: (For Contract projects only) Enter the number of hours the resource will work on the project. Offsite labor hours is used in the Contract revenue calculation. - Non-Billable Hours: (For Contract projects only) Enter the number of labor hours that needs to be included on the project but cannot be billed to the customer. Nonbillable hours is used in the labor expense calculation, but is excluded from the Contract revenue calculation.

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Oracle Project Financial Planning 11.1.2: Create Projects 4 - 6

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Spreading Logic: Select the logic that determines how values are distributed: Fill: Copies the value entered to all of the cells in a grid. For example, if a value of 200 hours is entered for a project, then the values for each month between the start and end dates of the project are set to 200. EvenlySplit: Divides the value entered between all of the cells in a grid. For example, if a value of 200 hours is entered for a project, then the 200 is divided over the number of months between the start and end dates.

- Comments: (Optional) Enter comments about the labor assignment. 7. Click OK. Note: For Contract projects, the project billing level is unspecified by default. Update it to correct the billing level, if required. This is used for calculating revenue. From the form, you can use the shortcut menus to add and remove labor assignments, calculate project labor, change labor assignments, view the standard hourly cost, and remove an employee assignment.

Removing a Labor Assignment

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om ฺ c ฺ cle uide a Changing Assignments r o tG @ ncan extend or shorten You use the shortcut menu to make changes to a labor assignment. ia dYou e r a kthe number the labor assignment, change the headcount, or change tu of hours assigned to the a S z ฺ project. The spreading logic field indicates how todapply theis e e th changes. m ham to us o (m nse a i r ce a i l k Za rable d e sfe m n ham n-tra o M no You use the shortcut menu to remove a labor resource that is no longer required on the project or to remove a labor assignment that was added by mistake.

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 7

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Calculating Labor Expenses Calculating project labor is a critical step for costing the project. After completing the Assign Labor Resources task, you must launch the business rule that calculates labor expenses.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Labor expenses m traaren calculation based on the hours per month and standard hourly labor rates, a h - formula: in this Masoshown non Hours per month * Standard Hourly Rates of Labor = Project Labor To calculate labor for new projects: 1. Navigate to one of the new project proposal task lists. 2. Expand Expense Planning, and then Add Labor. 3. Select the Calculate Labor Expenses task. 4. Launch one of the following business rules: - For Contract projects: CalculateProjectLaborExpenses-Contract - For Capital and Indirect projects: CalculateProjectLaborExpenses-Other 5. Enter the required information in the runtime prompt. 6. Click OK. Alternatively, you can use the shortcut menu on the Labor Assignment Details form (Add Labor task) to calculate labor expenses for the project.

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 8

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Reviewing Labor Expenses You review labor resource requests and their financial impact in the Project Labor Detail form.

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Oracle Project Financial Planning 11.1.2: Create Projects 4 - 9

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Assigning and Calculating Equipment Expenses You can request use of equipment for a project based on project requirements. When assigning equipment, you perform the following tasks: • Add equipment • Calculate equipment expenses • Review equipment expenses

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Oracle Project Financial Planning 11.1.2: Create Projects 4 - 10

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Adding Equipment You specify the equipment requirements for the project by using the Add Equipment task.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m You assign equipment m tran based on values defined in the Standard Equipment member. For a h -can request for laptops by selecting the Laptop standard equipment member. o oyou nunits Mexample, Specifynthe required and the duration of the assignment. To assign project equipment: 1. Navigate to one of the new project proposal task lists. 2. Expand Expense Planning, and then expand Add Equipment. 3. Under the Add Equipment task list folder, select Add Equipment. 4. Review the Add Equipment form. From the form, you can use the shortcut menu to add, remove, and change equipment requisitions, calculate equipment expenses, and view standard equipment rates. To add equipment to a new project: 1. Open the Add Equipment form. 2. Right-click a row and select Add Equipment Requisition.

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 11

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3. In the Add Equipment Requisition runtime prompt, specify or select the settings that are applicable for your project: - Standard Equipment: Select the equipment needed from a predefined list of equipment. - Equipment Description: (Optional) Provide details about equipment specifications. - Equipment Units: Enter the number of equipment units needed for the project. For example, if two cranes are needed for 200 hours per month, enter 2 in this field and 200 in the Equipment Usage/Unit field. - Equipment Usage/Unit: Enter the number of hours per equipment unit for the calculation. This is optional and you need only enter usage per unit if it is required for the project. For example, if three laptops are needed per month, enter 3 in the Equipment Units field and leave this field blank. - Assign for Project Duration (Y/N): The default is Yes. Select Yes if the equipment will be assigned for the duration of the project. If Yes is selected, you do not need to enter the assignment start and end dates. The rule automatically takes the project start and end dates. Select No if the equipment will not be assigned for the duration of the project. If No is selected, you must enter the assignment start and end dates for the equipment. If the equipment is used sporadically, enter the equipment start and end dates for the first period of the project to add the resource line item to the form. Then expand the year in the form to add additional hours for the equipment by period. - Assignment Start Date/Assignment End Date: If the equipment will not be assigned for the project duration, enter the start and end dates. If the start and end dates are not entered, the rule assumes the equipment will be assigned for the project duration. - Spreading Logic: Select the logic that determines how values are distributed in a grid: Fill: Copies the value entered to all of the cells in a grid. For example, if a value of 200 hours is entered for a project, then the values for each month between the start and end dates of the project are set to 200. EvenlySplit: Divides the value entered between all of the cells in a grid. For example, if a value of 200 hours is entered for a project, then the 200 is divided over the number of months between the start and end dates. Note: If the start and end dates are not completed, the Spreading Logic will use the full project duration to populate the months appropriately. - Justification: Provide a reason why the equipment is needed. 4. Click OK.

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Removing Equipment Requisitions You use the shortcut menu to remove an equipment requisition that is no longer required on the project or to remove an equipment requisition that was added by mistake. Changing Equipment Requisitions You use the shortcut menu to make changes to an equipment assignment. You can extend or shorten the assignment, or change the equipment units assigned to the project.

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 12

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Calculating Equipment Expenses After equipment requisitions have been entered or modified, you must run calculations to derive the project expenses for equipment usage based on equipment units and standard equipment rates.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m When the calculation m tran is executed, it determines the cost for all equipment assigned to the a h - duration of the project based on the following formula: o forothe Mproject n n Equipment Usage * Equipment Standard Rate = Equipment Expense

If there is no Equipment Usage, then Equipment Units will be used instead and Equipment Expense will be calculated as follows: Equipment Units * Equipment Standard Rate = Equipment Expense To calculate project equipment expenses: 1. Navigate to one of the new project proposal task lists. 2. Expand Expense Planning, and then expand Add Equipment. 3. Select Calculate Equipment Expense. 4. Launch the CalculateProjectAssetExpenses business rule.

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 13

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Reviewing Equipment Expenses You review expenses for the assigned equipment for a project in the Project Expense for Equipment – Detail form.

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Oracle Project Financial Planning 11.1.2: Create Projects 4 - 14

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Adding and Calculating Material and Other Requirements With the Add Material and Other Resources task list, you manage project materials, subcontractors, and other expenses resources.

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Oracle Project Financial Planning 11.1.2: Create Projects 4 - 15

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Adding and Calculating Material and Other Resources You add materials, subcontractors, and other resources for project expenses by using the Add Material & Other Resources task.

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2. Expand Expense Planning, and then expand “Add Material and Other Resources.” 3. Select Add Material & Other Resources. 4. Review the Material and Other Requirement form.

From the form, you can use the shortcut menu to add and remove material and other requirements, and calculate material and other resources. You use this task to enter labor and material resources not available within the organization. For example, you can hire a subcontractor as a potential labor resource and rent an asset that you do not need to purchase.

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 16

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To add material and other requirements to a project: 1. Open the Material and Other Requirement form. 2. Right-click a row and select “Add Material and Other Requirements.” 3. In the Add Material and Other Requirements runtime prompt, specify or select the settings that are applicable for your project: - Enter Resource Name: Enter the name of the material or other expense to be added. - Resource Descriptions: (Optional) Provide details about the resource being added. - Resource Class: Select from the following predefined resource classes: Material, Subcontractor, and Other. - Assign for Project Duration (Y/N): The default is Yes. Select Yes if the resource will be assigned for the duration of the project. If Yes is selected, you do not need to enter the requirement start and end dates. The rule will automatically take the project start and end dates. Select No if the resource will not be assigned for the duration of the project. If No is selected, you must enter the requirement start and end dates for the resource. If the resource is used sporadically, enter the requirement start and end dates for the first period of the project to add the resource line item to the form. Then expand the year in the form to add additional units for the resource by period. - Requirement Start Date/Requirement End Date: If the requirement will not be assigned for the project duration, enter the start and end dates. If the start and end dates are not completed, the rule assumes the requirement will be assigned for the duration of the project. Note: The requirement start and end dates must occur within the project start and end dates. Assignments cannot start before the project start date nor can they end after the project end date. - Spread Logic: Select the logic that determines how values are distributed in a grid: Fill: Copies the value entered to all of the cells in a grid. For example, if a value of 200 hours is entered for a project, then the values for each month between the start and end dates of the project are set to 200. EvenlySplit: Divides the value entered between all of the cells in a grid. For example, if a value of 200 hours is entered for a project, then the 200 is divided over the number of months between the start and end dates. - Units Required: Enter the number of units required for the material or other expense. - Cost UOM: Select from a predefined list the unit of measure for the cost. - Cost/Unit: Enter the cost per unit for the material and other expense. The materials and other expenses calculation will be based on Units Required × Cost/Unit. 4. Click OK.

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Oracle Project Financial Planning 11.1.2: Create Projects 4 - 17

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Calculating Material and Other Expenses You run business rules to calculate the expenses for materials and other expenses. This calculation multiplies the number of units entered by the cost per unit on a monthly basis for the duration of the project.

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Expand Expense Planning, and then expand Add Material & Other Resources. Select Calculate Material & Other Expenses. Launch the CalculateMaterialExpenses_Ruleset business rule. In CalculateMaterialExpenses_Ruleset, specify or select the settings that are applicable for your project. 6. Click Launch.

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 18

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Reviewing Material and Other Expenses You review summaries of the total material and other expenses associated with a project in the Total Material and Other Expenses form.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m To review material m tranand other expenses for a project: a h - to one of the new project proposal task lists. Mo1. Navigate non 2. Expand Expense Planning, and then Add Material & Other Resources. 3. Select Review Material & Other Expenses. 4. Review the Total Material and Other Expenses form.

You can use the shortcut menu to calculate project expenses.

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 19

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Entering Direct Project Expenses You enter lump sum amounts for expenses that do not have any logic defined to arrive at the values in the Enter Direct Project Expenses task.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe provides two methods for getting project data into the application. me Planning s Project m Financial n a -tra hcan: You o M non • • •

Perform detailed planning that uses rules to add data. Import data from a source system, and use Project Financial Planning to consolidate the projects. Enter expenses directly to a project.

To enter direct expenses for a project: 1. Navigate to one of the new project proposal task lists. 2. Expand Expense Planning. 3. Select Enter Direct Project Expenses. 4. Review and update the Enter Direct Project Expenses form.

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 20

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Calculating Overhead Expenses You apply overheads for a project by using the Apply Overheads task.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Overheads are n that are necessary for the performance of a job or continued m trexpenses a a h o onof-the business but cannot be specifically attributed to a project. With the Apply Mfunctioning n task list, you run the CalculateOverheads business rule that applies the overheads, Overheads both indirect expenses and general and administrative expenses, to the projects to arrive at a fully-loaded cost of the project.

To apply overheads to a new project: 1. Navigate to one of the new project proposal task lists. 2. Expand Expense Planning, and select Apply Overheads. 3. Launch the CalculateOverheads business rule. 4. In CalculateOverheads, specify or select the settings that are applicable for your project. 5. Click Launch.

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 21

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Reviewing Indirect and G&A Expenses You use the Review Indirect and G&A Allocated Expenses task to review the drivers and the associated costs for each overhead line item that is applied to your project.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe Generalm &m Administrative n (G&A) expenses relate to the company as a whole. These expenses a a r t h - administration, and general costs, such as: o facilities, Minclude non • • • • • • • •

Lease or mortgage Utilities, electric, and gas Cleaning Routine building maintenance Administering employee benefits, employee reviews, and related human resource activity Company parties All-hands staff meetings Employee training on soft skills

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 22

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Indirect expenses are costs that do not logically fit into overhead and are usually included in G&A. Examples of indirect expenses include: • Company-paid portion of health insurance • Salary for time taking training related to the type of project • Paid time off • Company cost of relocating a new hire • Unemployment compensation premiums To review indirect and general and administrative allocated expenses: 1. Navigate to one of the new project proposal task lists. 2. Expand Expense Planning. 3. Select “Review Indirect and G&A Allocated Expenses.” 4. Review the Review Indirect and G&A Allocated Expenses form.

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Oracle Project Financial Planning 11.1.2: Create Projects 4 - 23

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Reviewing Total Expenses

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d febeen planned and associated overheads applied, you use the Review me nhave s After allm expenses traform to review the expenses for a project. haExpense Project o n M no To review project expenses: 1. Navigate to one of the new project proposal task lists. 2. Expand Expense Planning. 3. Select Review Total Expenses. 4. Review the Review Project Expense form.

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 24

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Quiz The Adding Equipment task enables you to request use of equipment for a project based on project requirements. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 4 - 25

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Quiz Overheads are expenses that are necessary for the performance of a job or continued functioning of the business but cannot be specifically attributed to a project. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 4 - 26

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Summary In this lesson, you should have learned how to: • Assign and calculate labor expenses • Assign and calculate equipment expenses • Assign and calculate material and other requirements • Enter direct project expenses • Calculate overhead expenses s a • Review indirect and G&A expenses h ) m o • Review total project expenses ฺc ฺ

cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 4 - 27

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Practice 4-1 Through 4-7 The practice covers the following topics: • Capital Projects: Adding Equipment • Reviewing Total Expenses for Capital Projects • Contract Project: Adding Labor for PLNIU-Miller • Contract Project: Adding Equipment for PLNIU-Miller • Contract Project: Adding Other Expenses to PLNIU-Miller s a • Reviewing Total Project Expenses for PLNIU-Miller h ) m o • Indirect Projects: Adding Expenses ฺc ฺ

cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

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Planning for Contract Project Revenues

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Objectives After completing this lesson, you should be able to: • Enter revenue drivers for Cost Plus Contract projects • Enter revenue drivers for Time and Materials Contract projects • Enter revenue drivers based on units sold and sales price per unit • Enter direct project revenue s a h ) • Calculate project revenue m o eฺc deฺ l • Identify revenue recognition options c i ra

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Oracle Project Financial Planning 11.1.2: Create Projects 5 - 2

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Revenue Planning: Task Overview You use the Revenue Planning task list to plan for project revenue based on one of the following categories: • Cost Plus • Time and Materials • Fixed Price • Direct Revenue

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Revenue planning m tranapplies to projects classified as Contract projects. Project Financial Planning a h - revenue for Indirect or Capital projects. If these projects need to generate onot calculate Mwill noyoun must reclassify the project. revenue,

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 3

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Entering Revenue Drivers for Cost Plus Projects You define revenue parameters for a Cost Plus project category by providing margin requirements for different types of project expenses.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m You manage contractual arrangement for Cost Plus contracts in the Enter Revenue Drivers n m the a a r t h - The form enables you to view the Cost Plus revenue assumptions and the Cost o Plusonform. M-revenue nrecognition for a project. The Cost Plus margin percent (%) can be defined at the detail level (labor, equipment, materials, and other) or for total expenses. If the revenue definition is based on total expenses, Project Financial Planning will not allow you to build your assumptions at the detail level. The margin can be defined on a monthly basis, if needed. Expand the columns to override the margin % for a period. The Cost Plus driver is defined for the duration of the project. In the lower half of the form, you can review the revenue generated. Cost Plus revenue is also known as markups. The driver calculates the cost of the product, then adds a proportion of it as markup. For example, you enter labor expenses as the cost basis. Then you enter a 40% markup as revenue.

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 4

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To enter revenue drivers for Cost Plus Contract projects: 1. Navigate to the Propose New Contract Projects task list. 2. Expand Revenue Planning. 3. Select Enter Revenue Drivers - Cost Plus. 4. Review the Enter Revenue Drivers - Cost Plus form. In the form, you can use the shortcut menus to add and remove revenue assumptions, calculate Cost Plus revenue, and calculate intercompany revenue.

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Oracle Project Financial Planning 11.1.2: Create Projects 5 - 5

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Adding and Removing Revenue Assumptions You can add and remove Cost Plus revenue assumptions in the Enter Revenue Drivers – Cost Plus form.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe me nAssumptions s Addingm Revenue a -tra hPlus o Cost are set by selecting a Cost Plus driver base from which the margin is n M noassumptions applied.

To add revenue assumptions: 1. Open the Enter Revenue Drivers - Cost Plus form. 2. Right-click the form, and select Add Revenue Assumptions. 3. In Add Revenue Assumptions, specify or select the settings that are applicable for your project: - Cost Plus Driver: Select the expense base to which the margin will be applied. The margin can be set to Labor Expenses, Material Expenses, or Equipment Expenses or it can be applied in total to Total Expenses. - Revenue Source Description: An optional field to add a description for the revenue source. - Cost Plus Margin %: Enter the Margin % or mark-up that will be applied to expenses. 4. Click OK.

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 6

Note: If the Cost Plus revenue was set to Total Expenses, Project Financial Planning does not allow you to also build assumptions at the detail level (for labor, equipment, and materials). To change the manner in which revenue is earned, you must first change the driver from Total Expense to a detail line item, then you can add detail line items.

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Removing Revenue Assumptions You can remove revenue assumptions that are no longer required on the project or that were added by mistake. To remove revenue assumptions: 1. Open the Enter Revenue Drivers - Cost Plus form. 2. In the form, right-click the revenue element that you want to remove. 3. Select Remove Revenue Assumptions.

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Calculating Revenue for Cost Plus Projects You use a task-based business rule to calculate project revenue based on the assumptions provided.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Cost Plus project is calculated from the details (labor, equipment, and materials) or n m trarevenue a h -expenses for the project duration: o the total Mfrom non Labor Expense *(1 + Margin %) or Total Expense *(1 + Margin %) If a revenue assumption is not specified for a particular expense, it will be assumed at the cost (0% margin). To calculate Cost Plus revenue: 1. Open the Enter Revenue Drivers - Cost Plus form. 2. Right-click the form, and select Calculate Revenue. 3. Click OK.

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 8

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Quiz You must enter revenue information for all types of projects. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 5 - 9

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Quiz You can plan for revenue based on which of the following drivers? a. Cost Plus b. Total Capital c. Time and Materials d. Fixed Price e. Direct Revenue

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Oracle Project Financial Planning 11.1.2: Create Projects 5 - 10

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Entering Revenue Drivers for Time and Materials Contract Projects You define revenue parameters for the time and material project category by providing revenue details at the per-unit level of project resources.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe mEnter You usem the nRevenue Drivers - Time and Material form to manage time and materials a a r t h for the project. Project Financial Planning helps you build revenue o onarrangements Mcontractual n for labor, equipment, and materials. You can enter the billing rates at the project assumptions level or they can be derived from company assumptions. Billing rates can be defined at the resource level (that is, at the employee or equipment level).

Labor revenue is based on the billing level of the employee. Each labor resource has an associated billing level; you can override the assigned billing level on a monthly basis, if necessary. Billing rates for the project are defined on a monthly/yearly basis for the duration of the project. To enter revenue drivers for Time and Material Contract projects: 1. Navigate to the Propose New Contract Projects task list. 2. Expand Revenue Planning. 3. Launch the Enter Revenue Drivers - Time and Materials task. 4. Review the Enter Revenue Drivers - Time and Materials form. 5. From the tabbed area of the composite form, you can use the shortcut menus to view standard hourly rates, copy the base billing rate, calculate labor, material, and equipment revenue, and calculate total project revenue.

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 11

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Viewing Standard Hourly Rates You view the standard hourly rates in the Enter Standard Hourly Labor Rates form.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The Enter Standard m tran Hourly Labor Rates form displays the costs by job level that were used in a h You cannot override or change the labor rates that are displayed in this olabor calculation. nMthe form. no To view standard hourly labor rates: 1. Open the Enter Revenue Drivers - Time and Materials form. 2. Right-click the Employee Billing Detail form, and select View Standard Hourly Labor Rates. The Enter Standard Hourly Labor Rates form displays standard rates for each job.

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 12

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Copying the Base Billing Rate Standard billing rates are set by entity.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m To use the default m tranrates in the labor revenue calculation, you must perform the Copy Base a h - to copy the default rates to the project. Alternatively, you can set the billing o Rate MBilling ontask rates fornthe project. To copy the base billing rates: 1. Open the Enter Revenue Drivers - Time and Materials form. 2. Right-click the Set Project Billing Rate form, and select Copy Base Billing Rate. 3. Click OK.

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 13

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Calculating Labor Revenue You run the Calculate Labor Revenue business rule to update the total labor revenue for the project.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m This task calculates m tran the labor revenue. Labor revenue is calculated by multiplying Labor Hours a h -per month times Billing Rate per month: Mpero resource non Labor Hours * Billing Rate

To calculate labor revenue: 1. Open the Enter Revenue Drivers - Time and Materials form. 2. Right-click the Employee Billing Detail form or the Set Project Billing Rate form, and select Calculate Labor Revenue. 3. Click OK.

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 14

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Calculating Material Revenue You run the Calculate Material Revenue business rule to update the total material revenue for the project.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m This task calculates m tran the material revenue. Material revenue is calculated by multiplying Material a h - Rate per Material. Billing o times MUnits non

To calculate material revenue: 1. Open the Enter Revenue Drivers - Time and Materials form. 2. Right-click the “Billing - Material and Other Resources” form, and select Calculate Material Revenue. 3. Click OK.

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 15

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Calculating Equipment Revenue You run the Calculate Equipment Revenue business rule to update the total equipment revenue for the project

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The Calculate Revenue task calculates the equipment revenue. Equipment revenue n m tEquipment a a r h -by multiplying Equipment Usage, or Equipment Units if an Equipment Usage value calculated Misisonot nontimes the Equipment Billing Rate. used, Equipment Usage * Equipment Billing Rate To calculate equipment revenue: 1. Open the Enter Revenue Drivers - Time and Materials form. 2. Right-click the Billing – Equipments form, and select Calculate Equipment Revenue. 3. Click OK.

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 16

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Calculating Total Project Revenue You can calculate each type of revenue individually or calculate all of the sources at once.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The Calculate nProject Revenue task calculates the revenue for the following sources: m tTotal a a r h - and Equipment. o Material, MLabor, non To calculate the total project revenue: 1. Open the Enter Revenue Drivers - Time and Materials form. 2. Right-click the tabbed area of the form, and select Calculate Total Project Revenue. 3. Click OK.

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 17

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Entering Revenue Drivers Based on Units Sold and Sales Price Per Unit You define revenue parameters for revenue that are based on sales price per unit.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m For Contract projects, m tran the Enter Revenue Drivers – Unit Price form helps you define the a h for projects that earn revenue based on units sold and sales price per o assumptions nMrevenue unit. no For example, you enter sales revenue for 10 units of licenses sold at $1500 each. You can review, update, or add any additional revenue assumptions. To enter revenue drivers for Unit Price Contract projects: 1. Navigate to the Propose New Contract Projects task list. 2. Expand Revenue Planning. 3. Launch the Enter Revenue Drivers - Unit Price task. 4. Review the Enter Revenue Drivers - Unit Price form. 5. Right-click the tabbed area of the form, and use the shortcut menu to add and remove revenue assumptions and to calculate Unit Price revenue.

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 18

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After you enter revenue drivers for Unit Price, you must run the calculation to update the revenue for the project based on all of the assumptions defined. Revenue is calculated as Units Sold multiplied by Price Per Unit.

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Revenue will be recognized in accordance with the revenue recognition defined under the contract terms. To calculate Unit Price revenue: 1. Open the Enter Revenue Drivers - Unit Price form. 2. Right-click the tabbed area of the form, and select Calculate Revenue. 3. Click OK.

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Oracle Project Financial Planning 11.1.2: Create Projects 5 - 19

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Entering Direct Project Revenue You enter revenue for sources that are not derived at a detailed level.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe mReview You usem the n and Update Direct Revenue form to enter all other revenue that the project a a r t h -to generate, but that is not covered in the other methodologies. Misoanticipated non Project Financial Planning provides two methods for getting project data into the application: • Perform detailed planning by using rules to add data. • Import data from a source system and use Project Financial Planning to consolidate the projects. If the import method is used, the project revenue is displayed in this form. To view and enter direct revenue for Contract projects: 1. Navigate to the Propose New Contract Projects task list. 2. Expand Revenue Planning. 3. Launch the Enter Direct Project Revenue task. 4. Review the Review and Update Direct Revenue form.

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 20

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Revenue Recognition Revenue recognition options: • Monthly • Quarterly • Semi-Annual • After Completion • When Billed

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Revenue is recognized m tran based on the value defined in the Revenue Recognition text box when a h - project proposal. your Myouo created non • • • • •

Monthly: (Default) Revenue is recognized in the month the work is performed. Quarterly: Revenue will be recognized in the last month of each contract quarter. SemiAnnual: Revenue will be recognized in the 6 and the 12 month of the contract. After Completion: Revenue will be recognized after the last month of the contract. When Billed: Revenue will be recognized when a milestone is reached. Typically, this option is selected when there is no predefined time frame as to when revenue will be recognized.

Revenues are recognized when they are realized, realizable, or earned, depending on your company’s policies. Revenue is often recognized when goods are transferred or services rendered, no matter when cash is received. Revenue recognition affects when the income is included in the company’s financial statements.

Oracle Project Financial Planning 11.1.2: Create Projects 5 - 21

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Summary In this lesson, you should have learned how to: • Enter revenue drivers for Cost Plus Contract projects • Enter revenue drivers for Time and Materials Contract projects • Enter revenue drivers based on units sold and sales price per unit • Enter direct project revenue s a h ) • Calculate project revenue m o eฺc deฺ l • Identify revenue recognition options c i ra

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Oracle Project Financial Planning 11.1.2: Create Projects 5 - 22

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Practice 5-1 Through 5-2 The practice covers the following topics: • Entering Revenue Fixed Price Drivers • Entering Time and Material Revenue

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Oracle Project Financial Planning 11.1.2: Create Projects 5 - 23

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Reviewing Project Financials

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Objectives After completing this lesson, you should be able to review: • Review project financial statements • Review project metrics and KPIs • Review project justifications • Review project score • Review project funding

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Oracle Project Financial Planning 11.1.2: Create Projects 6 - 2

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Reviewing Project Financials Overview This lesson covers the following tasks under the Propose New Projects task list for all types of projects.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe me and s After allm revenue expenses are entered and calculated, you can view the financial n a a r t h o onfor- a project. This step assists you in evaluating projects before submitting them for Mstatements n You begin reviewing projects by calculating the financial statements. After they are approval. calculated, you can review the project’s impact on the Cash Flow and Income statements. You can then review the project KPIs, provide a detailed project justification, and review the project score so you can start analyzing the full financial outlook of the project and request funding.

Oracle Project Financial Planning 11.1.2: Create Projects 6 - 3

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Performing Calculations Prior to viewing financial statements, you must run a business rule that calculates the financial statements for a project.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The CalculateFinancialStatements business rule calculates project cash flow, taxes, and KPIs, m tran a h - up with a project score based on the financial impact. This calculation must be o then ocomes Mand n innorder to view complete and correct data in financial statements. executed To calculate financial statements: 1. Navigate to one of the new project proposal task lists. 2. Expand Review Project Financials. 3. Launch the Calculate Financial Statements task. 4. Launch the CalculateFinancialStatements business rule. 5. In CalculateFinancialStatements, enter the values that are applicable for your project.

Oracle Project Financial Planning 11.1.2: Create Projects 6 - 4

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Reviewing Project Financial Statements You review the effects of the project on cash flow and income.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe me and s After allm revenue expenses are entered and calculated, you can view the financial n a a r t h o onfor- a project. Mstatements n

To review the project impact on financial statements: 1. Navigate to one of the new project proposal task lists. 2. Expand Review Project Financials. 3. Launch the Review Impact on Financial Statements task. 4. Review the Review Impact on Financial Statements form. 5. From the tabbed area of the form, you can use the shortcut menu to calculate the project.

Oracle recommends that you review the project’s impact on Cash Flow and Income statements before submitting the project for approval.

Oracle Project Financial Planning 11.1.2: Create Projects 6 - 5

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Reviewing Project Metrics and KPIs You next calculate the project metrics and review and compare the performance of the project with corporate objectives.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d feperformance indicators (KPIs) for Contract projects. Some KPIs are me thenkey s You canm review traare based on the life of the project. Review the project-level defaults for haand nsome yearly o Mdiscountnrate o and tax rate that were defined in the entity, and make necessary changes. Before reviewing project KPIs, you must run the business rule that calculates all the KPIs and yearly performance indicators for a project. To open the Review Project KPIs form: 1. Navigate to the Propose New Contract Projects task list. 2. Expand Review Project Financials. 3. Launch the Review Project KPIs task.

Oracle Project Financial Planning 11.1.2: Create Projects 6 - 6

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To calculate project metrics: 1. Open the Review Project KPIs form. 2. Select the Yearly Performance Indicators tab. 3. Right-click and select Calculate Project Metrics. 4. Click OK. After calculating project metrics, review the contents of the Review Project KPIs form. Note: If you modify the global discount rate and assumptions at the project level, you must recalculate project data by running the CalculateFinancialStatements business rule.

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Oracle Project Financial Planning 11.1.2: Create Projects 6 - 7

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Reviewing Project Justification You complete the project justification by reviewing and answering predefined questions.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m You justify the n by providing responses to a list of predefined subjective questions; doing m tproject a a r h unit manager assign subjective scores to projects, which will then be ohelps the Mso onbusiness used fornproject ranking. Additional questions can be added to the application. The Detailed Project Justification form also enables you to rate a project for the subjective score. To review the detailed justification for a project: 1. Navigate to one of the new project proposal task lists. 2. Expand Review Project Financials. 3. Launch the Detailed Project Justification task. 4. Review the Additional Information - Project Justification form. The questions correspond to the subjective criteria on the right side of the form. The subjective scoring is based on the weightage for subjective goals defined in the Project Administration task list. Administrators can update the justification questions defined in the Accounts dimension.

Oracle Project Financial Planning 11.1.2: Create Projects 6 - 8

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Reviewing Project Score You calculate the project score to measure the performance of the project based on predefined sets of financial and strategic targets.

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Financial scores depend on the financial metrics and factors of the project, which are based on financial planning. Subjective scores are based on qualitative factors and on the responses to some predefined questions and their assessment by the entity manager. You can review project scores for individual projects and across projects. To review the project score: 1. Navigate to one of the new project proposal task lists. 2. Expand Review Project Financials. 3. Launch the Review Project Score task. 4. Review the Review Project Score form. For more information on project scoring and criteria, see Lesson 2.

Oracle Project Financial Planning 11.1.2: Create Projects 6 - 9

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Requesting Project Funding After planning expenses for a project, you determine the funding required for the project, and create a funding request.

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Funding requests are typically submitted to a company’s financial department. After a funding request is approved, the project can be assigned with the sources of funds, its cost-of-capital details, and time line of funding. This will help in calculating the cost of capital (interest expense) to be allocated for the project. Project Financial Planning provides funding request forms and predefined business rules so that you can create the funding request. For capital projects with multiple assets, you must request funding at the sub project level.

Oracle Project Financial Planning 11.1.2: Create Projects 6 - 10

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To request funding for a project: 1. Navigate to one of the new project proposal task lists. 2. Expand Project Funding. 3. Launch the Request Project Funding task. 4. Enter the required information in the Request Project Funding form. 5. In the form, you can use the shortcut menus to add new fund requests, cancel fund requests, and calculate the project.

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Oracle Project Financial Planning 11.1.2: Create Projects 6 - 11

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Adding and Canceling Funding Requests

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To add a new fund request: 1. Open the Request Project Funding form. 2. In the form, right-click and select Add New Fund Request. 3. In the Add New Fund Request runtime prompt, specify or select the settings that are applicable for your project: Funding Request Type: Select the type of funding request: - Initial Request: This is the initial funding request. - Request for Change: You are changing an existing request for funding. - Off Specification: The funding request is due to an omission in the product or service that is being offered

Oracle Project Financial Planning 11.1.2: Create Projects 6 - 12

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Funding Comment: (Optional) Provide comments about the funding request. Requested Amount: Enter the amount of the funds that you are requesting. Month/Year: For a lump sum requests, specify the month and year of the request. If funding is needed on a regular basis, enter a single month and year and then enter the additional months as needed. 4. Click OK.

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Canceling Funding Requests You run the Cancel Fund Request task to cancel a previously entered funding request. To cancel a fund request: 1. Open the Request Project Funding form. 2. Right-click the request that you want to cancel. 3. Select Cancel Fund Request. 4. Click OK.

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Oracle Project Financial Planning 11.1.2: Create Projects 6 - 13

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Reviewing Allocated Funds The Review Allocated Funds task enables you to analyze apportioned project funds.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m A project can approved for the full amount of the funding requested, or just a portion can be n m be a a r t h if a company obtains outside financing for projects, you can review how o Additionally, Mfunded. nonare allocated to each project. those funds The Review Allocated Funds task enables you to review the allocated funds, the sources of the funds, fund time lines, cost of funds, and repayment frequency for a project. Each finance round has different terms (for example, the interest rate), so each round of funding will impact the project differently. To review the allocated funds for a project: 1. Navigate to one of the new project proposal task lists. 2. Expand Project Funding. 3. Launch the Review Allocated Funds task. 4. Review the Review Allocated Funds form. 5. From the Fund Requests form, you can use the shortcut menu to add or cancel a fund request.

Oracle Project Financial Planning 11.1.2: Create Projects 6 - 14

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Quiz You calculate the project score to measure the performance of the project based on predefined sets of financial and strategic targets. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 6 - 15

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Quiz A project can only be approved for the full amount of the funding requested. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 6 - 16

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Quiz You must run a business rule that calculates the financial statements for a project prior to viewing financial statements. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 6 - 17

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Summary In this lesson, you should have learned how to review: • Review project financial statements • Review project metrics and KPIs • Review project justifications • Review project score • Review project funding

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Oracle Project Financial Planning 11.1.2: Create Projects 6 - 18

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Practices 6-1 Through 6-8 The practice covers the following topics: • Reviewing the Impact on Financial Statements • Rolling Up Project Data • Reviewing Contract Project KPIs • Capital Project: Adding Project Justification • Contract Project: Adding Project Justification s a • Indirect Project: Adding Project Justification h ) m o • Reviewing Project Scores eฺc deฺ l c • Requesting Funding ora Gui

@ ent a i r ka Stud a z dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 6 - 19

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Managing Intercompany Projects

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Objectives After completing this lesson, you should be able to: • Describe managing intercompany projects • Review existing projects • Calculate project data • Review intercompany reconciliations

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Oracle Project Financial Planning 11.1.2: Create Projects 7 - 2

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Managing Intercompany Projects Intercompany projects are transactions between two entities in the same organization.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Intercompany are relationships established between two internal entities to work n m tpartnerships a a r h -The project-owning organization establishes an intercompany partnership with the oa project. Mon nonthat is acting as a service provider to the project. The intercompany partner is organization reimbursed for its expenses through intercompany revenue.

After you create a new project, you can request that your administrator add an intercompany partner to that project. When administrators add an intercompany partner to a project, the ownership status of the partner entity is set to service provider. After setup, the service provider plans its expenses and then defines the terms for reimbursement from the owning entity. After the service provider defines the terms for reimbursement, the intercompany revenue can be calculated. When calculations are run, the intercompany expenses for the project owner are calculated at the total company level, and intercompany revenue and expenses are eliminated. Intercompany eliminations can be verified by using the forms provided in the application. Note: You must be provisioned to view intercompany eliminations at the total company level.

Oracle Project Financial Planning 11.1.2: Create Projects 7 - 3

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Limitations of Intercompany Projects • •

Intercompany partners can only be added to Cost Plus Contract projects. Intercompany partners are only allowed to budget in the base currency of the owning entity, because currency exchanges between the partner entity and the owning entity are not currently supported.

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Oracle Project Financial Planning 11.1.2: Create Projects 7 - 4

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Tasks for Intercompany Projects You perform the following tasks to plan financials of Cost Plus Contract projects for both the owning entity and the service provider entity: • Plan for expenses for the owning entity. • Plan for expenses for the service provider entity. • Plan for revenue for the service provider entity. • Review project financials for the service provider entity. as )h • Plan for revenue for the owning entity. m ฺco eฺ e l • Review project financials for the owning entity. id rac

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o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m These tasks are in the following lessons: n m tradescribed a h -4, “Planning for Project Expenses” Mo• Lesson non •

Lesson 5, “Planning for Contract Project Revenue”

These are the same standard project tasks, but they must be performed in both owning entity and service provider entity projects. Note: When planning for expenses and revenue, you must ensure that you select the correct entity on the POV.

Oracle Project Financial Planning 11.1.2: Create Projects 7 - 5

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Calculating Cost Plus Intercompany Revenue You run the Calculate Inter Company Revenue rule to derive project revenue.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m For projects where m tranthe organization is a service provider, you must run the Calculate Inter a h rule to derive the project revenue based on a cost plus margin. o oRevenue MCompany n n To calculate Cost Plus intercompany revenue: 1. Navigate to the Manage Existing Contract Projects task list. 2. Expand Update Process, and then expand Project Revenue. 3. Click Review and Update Revenue Drivers - Cost Plus. 4. Review the Review and Update Revenue Drivers - Cost Plus form. 5. In the form, right-click and select Calculate Inter Company Revenue. 6. Click OK.

Oracle Project Financial Planning 11.1.2: Create Projects 7 - 6

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Calculating Project Data Running the business rule rolls up and reconciles intercompany data at the entity level.

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Oracle Project Financial Planning 11.1.2: Create Projects 7 - 7

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Reviewing Intercompany Reconciliations Project Financial Planning automatically reconciles the intercompany transactions at the entity level.

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Oracle Project Financial Planning 11.1.2: Create Projects 7 - 8

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Summary In this lesson, you should have learned how to: • Describe managing intercompany projects • Review existing projects • Calculate project data • Review intercompany reconciliations

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Oracle Project Financial Planning 11.1.2: Create Projects 7 - 9

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Practices 7-1 Through 7-9 The practice covers the following topics: • Setting Up the Intercompany Partner • Expense Planning for the Owning Entity • Expense Planning for the Servicing Entity • Revenue Planning for the Servicing Entity • Calculating Financials s a • Reviewing Impact on Financial Statements h ) m o • Reviewing Project KPIs and Justifications eฺc deฺ l c • Reviewing Intercompany Reconciliations ora Gui @ ent a i • Requesting Funding r d a

ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 7 - 10

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Managing Existing Projects

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Objectives After completing this lesson, you should be able to: • Describe existing projects • Describe the process for managing existing projects • Identify the tasks for managing existing projects

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Oracle Project Financial Planning 11.1.2: Create Projects 8 - 2

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Managing Existing Projects

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe compares actual and budgeted expenses, schedules, and me Planning s Project m Financial n traprovides tools to forecast project expenses and revenue. It enables you to ha n-and performance o M no change the base assumptions for labor, equipment, materials, and revenue, and it recalculates the financial outlook of the project.

Existing projects are approved projects imported from transactional systems that may be reconciled with proposed projects in Project Financial Planning. By reconciling projects, you can compare financials between your plans, forecasts, and actuals.

Oracle Project Financial Planning 11.1.2: Create Projects 8 - 3

Process for Managing Existing Projects 2

3

Review project performance.

Create and update forecast data

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Import and reconcile projects

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ d thi Update assumptions, Submit plan for Review financialseand m resources, and approvals. manage m funding. se u a h expenses. o t o e m ( nsand/or its affiliates. All rights reserved. a i e r Copyright © 2012, Oracle c aka ble li Z ed sfera m Before m you can manage n existing projects, your administrator must load project details and any a a r t h - external source systems. After the project is loaded, you can review the from o data Mactual non performance of the project with respect to key project drivers by using the Review Project Performance task. You can then update the assumptions for the key elements of the project (for example, realigning resources, changing equipment, updating expenses, and requesting funds).

The process for managing Capital, Contract, and Indirect projects is similar. Notable differences include: • For Capital Projects, asset values are listed in the Construction in Progress (CIP) asset list. Asset managers can use this list to provide details for assets and prepare them to be used as normal assets for other projects. • For Contract Projects only, you can update revenue assumptions.

Oracle Project Financial Planning 11.1.2: Create Projects 8 - 4

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Managing Existing Projects Task List Tasks • • • • • •

Review Project Performance Dashboard Review Existing Projects Update Process Review Project Project Funding Submit Plan for Approval

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe me Performance s Reviewm Project n a -tra hReview o The M nonProject Performance task opens the Financial Overview – PM form, which

displays a snap shot view of a project’s performance from a financial perspective. The key financial measures included in the form are financial variance analysis, cash flow, profit and loss impact, and project score. By reviewing these measures, you can determine areas in the project that are efficient and areas that are lagging. You can drill down into the project details to view the areas that may need attention or where forecasts need to be updated. Review Existing Projects The Review Existing Projects task enables you to review the financial and non-financial details of the project. You can edit project details in the Existing Project Details section of the form, including project name, description, revenue recognition and incidence (for Contract projects only), project manager, project customer, and project details.

Oracle Project Financial Planning 11.1.2: Create Projects 8 - 5

The project start and end date, type, status, and ownership are also viewable in this section. You can review the project variances, impact on income statement, impact on cash flow, life time KPIs, and funding requests in the Financial Impact section of the form.

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Update Process The Update Process task list contains several tasks that allow you to manage project expenses and project revenue (for Contract projects only). The Project Expenses task list guides you through the process of reviewing details about the expense components of a project and contains the following tasks: • Review and Update Labor Assignments • Review and Update Equipment Assignments • Review and Update Material & Other Requirements • Review and Update Direct Expenses • Apply Overheads • Review Indirect and G&A Allocated Expenses • Review Project Expenses

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om ฺ c ฺ The Project Revenue tasks list is available for Contract projects and a enables cle uyou dtoe review i r o the revenue generated by the project from various sources: G t @ n a i • Cost Plus ar tude k a • Time and Materials dฺz this S e • Fixed Price m se m u a h • Direct Revenue o t o (m nse Review Project a i e ar eare icentered l k After all revenue andaexpenses and calculated, you can view the updated l Z b financial statements ed sforfearaproject. m The Review an task list includes the following tasks: am Project r t h o M • Calculate non Financial Statements • • • •

Review Impact on Financial Statements Review Project KPIs Detailed Project Justification Review Project Score

Project Funding You can modify project funding requests and review allocated funds using the tasks in the Project Funding task list. Submit Plan for Approval After you complete the tasks for the project, review financial statements, and request funding, you can promote your plan to another user for approval.

Oracle Project Financial Planning 11.1.2: Create Projects 8 - 6

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Quiz Before you can manage existing projects, your administrator must load project details and any actual data from external source systems. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 8 - 7

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Quiz You must update revenue for all project types after importing projects from source systems. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 8 - 8

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Summary In this lesson, you should have learned how to: • Describe existing projects • Describe the process for managing existing projects • Identify the tasks for managing existing projects

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Oracle Project Financial Planning 11.1.2: Create Projects 8 - 9

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Practices 8-1 Through 8-8 The practice covers the following topics: • Reviewing Existing Project Details • Updating Labor Expenses • Reviewing Equipment Expenses • Reviewing Other Expenses, Overheads, and Indirect Costs • Reviewing Projects s a • Reviewing Project Justifications h ) m o • Reviewing Project Scores eฺc deฺ l c • Reviewing Other Existing Projects ora Gui

@ ent a i r ka Stud a z dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 8 - 10

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Reviewing and Approving Projects

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Objectives After completing this lesson, you should be able to: • Identify financial analysis and project approval tasks • Run business rules to calculate data • Review project financials and perform detail analysis • Review funding requests • Review project proposals and scores s a • Review financial performance h ) m o • Submit and approve projects ฺc ฺ

cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 2

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Lesson Agenda This lesson covers two sets of task lists: • Reviewing Projects • Finance Analysis

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The tasks covered m tranin this lesson is divided into two sections: a h - Projects tasks are, typically, performed by a project planner Mo• Reviewing non •

Finance Analysis tasks are, typically, performed by a financial analyst or a budget administrator

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 3

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Process for Reviewing Projects 1. 2. 3. 4. 5. 6. 7.

Calculate Project Review Project Proposals and Existing Projects Analyze Impact of Forecast Updates Review Financials Compare Financial and Subjective Scores Review Project Justifications Submit Project Plan for Approval

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The process reviewing projects begins with calculating the financial statements for the n m for a a r t h o organization. Mentire non

After the calculation is performed, you can begin the review project details, first by focusing on the financial impact of new project proposals, then analyzing the impact of forecast updates for existing projects. You can review financials by accessing forms and tasks that display income statement impact, cash flow, funding requests, and KPIs. You can then compare project scores to help evaluate the project from both a financial and a subjective perspective, as well as review the project justifications as another analysis point in viewing and approving projects. Finally, you are presented with the financial overview, which provides you with a high-level view of the financial performance of each project and of your organization as a whole. The overview helps you identify issues and enables you to work interactively with the financials. You can review current year financials, net income, cash flow trends, and the project-level project score. When the review process is completed, you can approve or reject the plans associated with the projects.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 4

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Calculating Departmental Financial Statements Before reviewing projects, you must run the Calculate Department Level Financial Statements task to update data.

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To calculate department level financial statements: 1. Launch the Calculate Department Level Financial Statements task under the Review Projects task list. 2. Click Launch.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 5

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Reviewing Project Proposals

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m You launch the n Projects task list to view new project proposals that are awaiting m trReview a a h approval. You can access project details, income statement impact, cash flow, o and Mreview non funding requests, and KPIs by launching this task.

To review project proposals: 1. Under the Review Projects task list, click the Review Project Proposals task. 2. Review the Review Project Proposals form.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 6

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Reviewing Existing Projects

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe Projects task, you can evaluate the financial and non-financial me Existing s With them Review n tra projects. You can review the income statement impact, cash flow, funding haof existing details o n M no requests, and KPIs associated with the project.

To review existing projects: 1. Under the Review Projects task list, launch the Review Existing Projects task. 2. Review the Review Existing Projects form.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 7

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Comparing Project Scores

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe and subjective scores of projects within your entity. By comparing me allnfinancial s You canm review tra based on a set of targets, you can use the scores to rank the projects for ha performance project o n M no approvals.

On the Compare Project Scores form, you can review financial and subjective project scoring. To compare project scores: 1. Under the Review Projects task list, launch the Compare Project Scores task. 2. Review the Compare Project Scores form.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 8

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Reviewing Project Performance

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The Performance m tranReview task list provides the following review tasks: a h -Financial Performance Mo• Project non • •

Departmental Financial Performance Review Impact on Financial Statements

The Project Financial Performance task summarizes the financial performance of each project and of your organization as a whole. The form displays variances and graphs based on financials that help you identify project issues and efficiencies. To review project financial performance: 1. Under the Performance Review task list, launch the Project Financial Performance task. 2. Review the Project Financial Performance form.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 9

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Reviewing Departmental Financial Performance

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m To review departmental m tran financial performance: a h - Performance Review task list, launch the Departmental Financial the Mo1. Under non Performance task. 2. Review the Departmental Financial Performance form.

You can review current year financials, cash flow trends, net income trends, and headcount trends at the departmental level by launching the Departmental Financial Performance task.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 10

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Reviewing the Impact on Financial Statements

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The Review Impact m tran on Financial Statements task displays a form that includes financial data a h o oton-the impact on cash flow and the impact on income statement based all your Mpertaining n projects or on a specific project.

To review departmental financial performance: 1. Under the Performance Review task list, launch the Review Impact on Financial Statements task. 2. Review the Review Impact on Financial Statements form.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 11

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Lesson Agenda This lesson covers two sets of task lists: • Reviewing Projects • Finance Analysis

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The tasks covered m tranin this lesson is divided into two sections: a h - Projects tasks are, typically, performed by a project planner Mo• Reviewing non •

Finance Analysis tasks are, typically, performed by a financial analyst or a budget administrator

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 12

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Project Financials Overview

Current Year Financials

Total Fund Requests

Net Income

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e tHead hi Count Cash Flow Trend m Trend ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The finance manager m tran begins the project financial analysis by reviewing an overview of several a h -measures: o financial Mkey non • • • •

Current Year Financials Total Fund Requests Net Income and Cash Flow Trend Head Count Trend

After the financial measures are reviewed, the finance manager can perform a detailed analysis of the entities in the organization and the project financials. The detailed analysis shows the net revenue, total expenses, net income or loss, project cash flow, and ROI by organization. Then, the finance manager makes funding decisions and submits the plan for approval.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 13

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Finance Analysis Task List The Finance Analysis task list includes the following tasks: • Run Rollups • Finance Overview • Detailed Analysis • Project Funding • Submit Plan for Approval

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Oracle Project Financial Planning 11.1.2: Create Projects 9 - 14

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Running Rollups 2

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1

3

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om ฺ c ฺ cle uide a r o tG @ 4 ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m You launch the n Rollups task to calculate and consolidate data using a business rule. Run m trRun a a h -rule before reviewing financials to ensure that your data is updated. Mtheo business non

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 15

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Viewing the Financial Overview

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The financial n provides you with a high-level view of the financial performance of your m overview a a r t h o on-You can review current year financials, total fund requests, net income and cash Morganization. n flow trends, and headcount trends at the organization level.

To view the Financial Overview, launch the task under the Finance Analysis task list. From the Financial Overview form, you can perform the following tasks: • Allocate funds • Change funding status • Review project financial statements • Review project KPIs

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 16

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Financial Overview: Allocating Funds After planning expenses for a project, the finance manager can allocate funds.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m After you request funding, the finance manager determines the funding required across m tran a h -determines how to secure the required funds. After the funding source has been o and Mprojects non determined, the finance manager allocates the funds back to the projects.

The project can be assigned with the sources of funds, the project’s cost-of-capital details, and the time line of funding. This determines the cost of-capital information and cash flow for the project. To allocate funds: 1. Launch the Financial Overview task. 2. In the Total Fund Request form, right-click and select Allocate Fund. 3. In the Allocate Fund runtime prompt, specify or select the values that are applicable for your project: - Funding Source Code: Identify the funding source. - Funding Source Description: Describe the funding source.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 17

Funding Instrument Type: Select form the following funding types: Internal Funding, External Funding Short Term, External Funding Long Term, Subordinated Debt, 7 1/2% Senior Notes, Unspecified. Note: You can customize this Smart List to suite your needs. - Funding Amount: Enter the funding amount allocated to the project. Allocated funding could be the equal to or less than the funding request from the project manager. - Funding Date: Specify the date that the funding was secured. - Term (In Months): Enter the repayment term (in months) of the funding. - Repayment Frequency: Select from the following payment terms: Quarterly, Semiannually, or Yearly. - Implicit Interest Rate: Enter interest rate. 4. Click OK.

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Oracle Project Financial Planning 11.1.2: Create Projects 9 - 18

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Financial Overview: Changing Funding Status You can change the funding status for a project to one of the following options: • Approved • Unapproved • On-hold

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The funding status m tranis set to New when a request is made. Once the requests are submitted for a h -approving authority could change the status of individual requests before o othe Mapproval, n n promoting the plan through the Approvals process.

Note: Allocating funds will automatically change the status to Approved. To change project funding status: 1. Launch the Financial Overview task. 2. In the Total Fund Request form, right-click and select Change Funding Status. 3. In the Change Funding Status runtime prompt, specify or select the values that are applicable for your project: - Enter Project: Select the project or projects. - Enter Project Elements: Select the funding request. - Enter Status: Select from the following options: - Approved: Select if the funding request has approval to move forward. - Unapproved: Select if the funding request was rejected or not approved. - On-hold: Select if the funding is postponed or needs to be put on hold. 4. Click OK.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 19

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Financial Overview: Reviewing the Impact on Financial Statements

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe impact on cash flow and income statements by launching the me thensproject’s You canm review a trFinancial ha Project Review Statements task. o n M no To review project financial statements: 1. Launch the Financial Overview task. 2. In the Total Fund Request form, right-click and select Review Project Financial Statements. 3. Review the Review Impact on Financial Statements form.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 20

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Financial Overview: Reviewing Project KPIs

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d feperformance indicators (KPIs) for projects. Some KPIs are yearly and me thenskey You canm review traon the life of the project. Review the project-level defaults for discount rate haare based some o n M no and tax rate that were defined in the entity and make necessary changes.

To review project KPIs: 1. Launch the Financial Overview task. 2. In the Total Fund Request form, right-click and select Review Project KPIs. 3. Review the Review Project Metrics and KPIs form.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 21

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Performing Detailed Analysis You launch the Detailed Analysis task to view a high-level display of the financial performance of each entity within your organization.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The following nfinancial measures are provided to help you analyze organizational m tkey a a r h performance: Mo non-

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• Net Revenue • Total Expenses • Net Income/(Loss) • Cash Flow • ROI To view the Detailed Analysis, launch the task under the Finance Analysis task list. Analyzing the Impact on Income Statement To display a detailed analysis of a project’s revenue and expenses by fiscal year, right-click the lower portion of the form and select Impact on Income Statement. You can view the project’s financials and resources on the Impact on Income Statement form. Analyzing the Impact on Cash Flow To display a detailed analysis of the amount of cash flow generated and used by a project, right-click the lower portion of the form and select Impact on Cash Flow. You can view the flow of cash in and out of a project on the Impact on Cash Flow form.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 22

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Reviewing Project Funding You can view funding requests for a project and review the funds allocated to a project.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m To review project m tranfunding allocations and requests, launch the Project Funding task under the a h - task list. The task opens the Project Funding form. o Analysis MFinance non Funding Requests

The Funding Requests section of the form displays requests per project, the request type, funding status, and the requested amount per year. Allocated Funds The Allocated Funds section displays the funding element allocated and interest expenses per project or for all projects (total project). Deallocating Funding You can delete funding for a project that is no longer required or was added in error. To deallocate a fund: 1. In the Project Funding form, right-click the Fund Allocation section and select Deallocate Fund. 2. When prompted to delete, click OK.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 23

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Approving Projects Changing the status of a project to Approved locks the project but does not submit the planning unit for approval. Right-click a project and select Change Project Status.

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om ฺ c ฺ cle uide a r G Then, select a newoprojecttstatus. @ n a i ar tude k a dฺz this S e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d me nsfecan approve projects. Once a project is approved, it is locked for Project m administrators tra information on changing project status, see “Changing Project Status” in ha . For editing. more o n M no Lesson 3.

The next topic covers submitting the project for approval through the planning unit review cycle.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 24

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Submitting Plans for Approval

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Once you have all of the tasks for the project and you have reviewed the financial n m trcompleted a a h - requested funding, you can promote your plan to another user for approval. o onand Mstatements n

Contracts are associated with planning units. You promote your project’s planning unit when it is ready to be reviewed and approved. Approval States During the budget review process, a planning unit is always in one of the approval states described in the following table: • Not Started: The initial state of all planning units. The budget administrator initiates the review process by using the Start action. • 1st Pass: The first state for planning units. Planning units have no owner during this state. Any user with data access can enter data and promote a planning unit. • Under Review: The state of a promoted planning unit. A planning unit is reviewed by someone in the organization. Only the current owner or the budget administrator can modify data.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 25

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• •

•

• •

Frozen: The state of a locked planning unit, which is read-only. The planning unit can be unfrozen only by the user who froze the planning unit or owners above them in the planning unit hierarchy. Distributed: The state of a planning unit that is under review by multiple users. The reviewers are filtered by those permitted to perform distribute actions. Under Assistance: The state of a planning unit that is on hold while its owner requests help from another user. Ownership returns to the current owner when the user providing assistance changes the planning unit status to Return. Signed Off: The state of a planning unit that was signed off. Only the current owner or the budget administrator can modify data. Ownership does not change when a planning unit is signed off. Not Signed Off: The state of a rejected planning unit. The current owner or the budget administrator can modify data. Approved: The state of an approved planning unit. A budget administrator becomes the owner of the planning unit, and is the only person who can modify data. After all planning units are approved, the budget review process is completed.

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om ฺ c ฺ Note the following points about approval states: cle uide a r o data,t the • If you have read access for a planning unit, you can view the G approval state, @ n and the history, and you can read and enter annotations e units in all states ria foruplanning d a k t except for the Not Started state. za is S ฺ d • A planning unit may skip approval states. e For eexample, th an administrator may approve a m started planning unit from any state. am to us h o • You can manage the approval e at a higher level with parent planning units. m process ( s n a Promote Action ri lice a k le are available to change the status of a planning unit and direct Actions are the operations Za rabthat d ethrough its movement fethe budget review process. m s n m When tra the Promote action, the validation rules defined for the planning unit are run. ha younselect o in all associated data validation rules are met, the planning unit is promoted MIf the conditions no to the next owner defined in the planning unit promotional path. If the data validation rule results in a planning unit owner assignment, the planning unit is promoted to this owner, who may be different than the owner defined in the planning unit promotional path.

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 26

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Reviewing Projects You use the Review Projects task list to review, approve, and reject project proposals.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The Review Projects m tran task list includes the following tasks: a h - Department Level Financial Statements Mo• Calculate non • • • •

•

Review Project Proposals Review Existing Projects Compare Project Scores Performance Review - Project Financial Performance - Departmental Financial Performance - Review Impact on Financial Statements Approve Projects

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 27

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The following list describes reviewer actions: • Promote: Submits the plan data to a reviewer, runs validation rules for the planning unit, and changes the status to Under Review. For planning units with a status of Under Review, you cannot enter data for the planning unit unless you are the owner or the budget administrator. • Originate: Changes the ownership of selected planning units (including its descendants) to the first owner defined for that planning unit in the planning unit hierarchy. The planning unit first owner differs between the Distribute and Bottom Up templates. • Reject: Returns the planning unit to the previous owner for further adjustments before being approved, and changes the status to Not Signed Off. • Approve: Indicates that the planning unit passed through all required levels of review, and changes the status to Approved. The budget administrator becomes the owner. Only the last user in the promotional path and the administrator can select this status. • Delegate: Passes ownership to a user who is not defined in the promotional path. When that user is finished with the planning unit, he or she promotes it to return it back to the user who delegated it. This action is available only with the Bottom Up template. • Take Ownership: Bypasses the current owner and enables you to edit data outside the promotional path. This action is available only to users who are above the planning unit owner in the planning unit hierarchy. • Freeze: Locks all related data in descendant planning units and makes it read-only. This action does not change ownership. Only the planning unit owner or administrator can select the Unfreeze action to release the planning unit. • Distribute, Distribute Children, or Distribute Owner: Passes planning unit ownership to multiple users. Distribute actions depend on the current location of the budget in the planning unit hierarchy. These actions are available only for the Distribute template. • Need Assistance: Passes ownership to a user whom you contact for help with budget tasks. When the person is finished, he or she returns ownership back to the requestor. The person is not necessarily included in the promotional path. This action is available only for the Distribute template. • Sign Off: Allows a reviewer to sign off a planning unit without promoting it to another user, and changes the status to Signed Off. • Reopen: Enables the administrator to return an approved planning unit to the last owner and change its status back to Under Review. The history and annotations are retained for the planning unit. The options are determined by the current status of the planning unit.

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Oracle Project Financial Planning 11.1.2: Create Projects 9 - 28

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Quiz You can only base project scoring on financial measures. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 9 - 29

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Quiz You approve a project by setting its planning unit status to Promote. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 9 - 30

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Quiz Allocating funds will automatically change the funding status to Approved. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 9 - 31

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Summary In this lesson, you should have learned how to: • Identify financial analysis and project approval tasks • Run business rules to calculate data • Review project financials and perform detail analysis • Review funding requests • Review project proposals and scores s a • Review financial performance h ) m o • Submit and approve projects ฺc ฺ

cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 9 - 32

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Practices 9-1 Through 9-4 The practice covers the following topics: • Running Rollups • Reviewing the Financial Overview • Performing Detailed Analyses • Reviewing and Approving Project Funding

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Oracle Project Financial Planning 11.1.2: Create Projects 9 - 33

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Analyzing the Workforce

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Objectives After completing this lesson, you should be able to: • Describe the workforce tasks related to Project Financial Planning • Calculate data to update project workforce costs • Review resources and assignments • Review resource utilization s • Review labor requests a h ) m • Assign labor resources to projects o ฺc eฺ e l c • Request new hires ra Guid o @ ent a • Recalculate compensation costs i r d ka Stuheadcount a z • Review total compensation and employee dฺ is

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Oracle Project Financial Planning 11.1.2: Create Projects 10 - 2

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Analyzing the Workforce Analyzing the workforce helps you to: • Review the cost and utilization of all labor resources in an entity • Evaluate workforce requirements for all projects in an entity • Allocate resources to projects based on the skill set, availability, and competency of the resource s a h • Plan to hire an outside resource, if the skill set for a m) ฺco eฺ required job is not available internally e l c

ra Guid o @ ent a i r ka Stud a z dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Through workforce m tran analysis, companies determine the employee resources needed to a h - targets, assign existing employees to various positions, and plan for adding o otheir Machieve n n new employees.

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 3

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Driver-Based Planning for Workforce Costs Driver-based planning incorporates key business assumptions into planning models. You use drivers to calculate costs, such as: • Healthcare • Taxes • Bonuses • Merit increases s a h ) You can also plan for situations like: om

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eฺc deฺ l c ra Gui o @ ent a i r ka Stud a z Job Transfers Leave of Absence Departures dฺ this e m e ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Companies must m trangauge the various direct and indirect costs incurred by employees, such a h ohealthocare n- and taxes. Project Financial Planning calculates these expenses—both Mas n simple and complex—based on certain drivers. You can model future headcount and related expenses, working with up-to-date information about workforce expenses. By planning compensation expenses in direct correlation to headcount, planners can effectively manage one of their largest variable expenses. You can perform very detailed workforce planning that utilizes built-in functionality, such as planning for transfers, leaves, departures, and so on. Or, you can plan at a higher level using requisitions and standard rates for jobs.

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 4

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Required Metadata and Data Overview You import Workforce Planning data and metadata to manage labor resources and requests related to the project. The following table lists the header records and sample data for the EmployeeMem.csv file:

Header Record

Sample Data

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om ฺ c ฺ cle uide a r Parent Existing Employeeso G t @ n a i kar Stude Description (optional) PaulzKim a dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e me nsfthat Oracle m recommends customers update existing employee data (dimensions and data) a a r t h - financial plans, either Plan or Forecast. After you update the Employee o preparing Mbefore non Employee

Paul Kim

dimension and refresh the application, you can execute employee compensation calculations to consolidate up-to-date employee compensation plans or forecasts.

Note: For information about Workforce Administration tasks, see the “About Workforce Administration” section of the “Administration Tasks” lesson. The following sections describe the Workforce Planning data and metadata that you can update. Smart Lists Before loading Smart Lists and Smart List values, you must identify the associated product field names and entry names. To load a Smart List, specify its product or member name in the Smart List Name column of the data load file. To load Smart List values, enter the corresponding entry name in the Entry Name column of the data load file.

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 5

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You manage entries for the following Smart Lists: • AssignmentLocation • Grade • ProjectManager • SkillSet Metadata When you load metadata, you can add members to Employee dimension. Consider the following when loading metadata: • Ensure that the parent member exists in the application before loading children to it. • All of the templates can be used for single currency Project Financial Planning applications by removing the Currency dimension from the POV. Under the Employee dimension, you add metadata for existing employees. The slide lists the header records and sample data for this file.

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After you have finished loading metadata, you can verify that the members were added by opening the Dimension Editor in your Project Financial Planning application.

om ฺ c ฺ cle uide a Data r o tG @ You use the Workforce Assumptions Template to load data related ia detonWorkforce Planning, r a such as Social Security tax rates, Medicare rates, and kemployee tugrades. You load a S z ฺ Workforce Assumption data by using the ImportWFPAssumptions_1.csv data load file. ed e this m After loading the required metadata and Planning, you can associate an s mdata foruWorkforce a h o employee to a project. For more information o e ton data load file order, see “Data Load File m ( Order” in the “Administration Tasks” lesson. ns a i e r c aka ble li Z ed sfera m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 6

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Analyzing Workforce: Task Overview As a resource manager, you perform the following tasks in the application to analyze your workforce:

Roll up the data.

Review the dashboard and utilization.

Review resource requests across projects.

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om ฺ c ฺ cle uide a r o tG @ ia den Staff the r a u k t projects. a dฺz this S e Create Review compensation, m new-se m u a hire requests. headcount, and FTEs. h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m You perform following tasks under the Workforce Analysis task list: n m the a a r t h n-the data. Mo1. Roll noup 2. 3. 4. 5. 6.

Review the resource manager dashboard and resource utilization. Review resource requests across projects. Staff the projects. Create new-hire requests. Review total compensation, headcount, and full-time equivalents (FTE).

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 7

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Task Lists for Workforce Analysis and Planning The task lists for analyzing and planning your workforce are designed to support standard process flows.

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Add: Add to the system. Calculate: Run a rule to update costs. Review: Review the calculated data.

After loading existing employees from a source system, the Employee dimension and its account properties are prepopulated in the Project Financial Planning application, and accurate resource expenses can be reviewed and calculated. Typically, you review the information on existing employees in their department or cost center, verifying their salary, employee properties such as full time or part time, and other compensation assumptions, such as bonuses and merit increases. Then, you can make adjustments as new events occur (for example, employees are hired, transferred, retired, and so on). After verifying that the existing employee information for your entity is accurate, you can plan for new hires. To add newly hired employees to a department, you use the Add TBH Hourly or Add TBH Salary business rule.

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 8

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Rolling Up Data You roll up the workforce data to aggregate it.

Select values for the runtime prompts.

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om ฺ c ฺ Click Launch to run cle uide a the business rule. r o tG @ ia den r a u Launch to ak s StClick z ฺ ed e thi calculate costs. m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe mcan Before m you analyze n employee costs, you must calculate and update workforce costs by a a r t h Rollup WFP Cube business rule. o the Mrunning non To roll up data: 1. Under Workforce Analysis, select Roll Up Data. 2. Click Launch to open the business rule. 3. Select the values for the following runtime prompts: Entity, Project, Scenario, and Version. 4. Click Launch calculate and aggregate workforce costs.

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 9

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Reviewing the Resource Manager Dashboard The Workforce Overview form provides an at-a-glance view of the utilization, hiring plan, and staffing requirements for an entity.

Select an entity.

Select a year.

Click to drill-down to view details of the total headcount.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m You use the n Manager Dashboard task to help you manage resources across the m Resource a a r t h o on- You use this information to see how the company is performing and to identify Morganization. n potential issues. The dashboard provides a quick visualization of key elements with which you can interact: utilization, hiring plans, and project staffing. To review resource manager dashboards: 1. Under Workforce Analysis, select Review Resource Manager Dashboard. 2. In the Entity drop-down list, select an entity. 3. In the Year drop-down list, select a year. 4. Optional: Click the chart data to drill-down to details. Note: Be sure to calculate or recalculate the data prior to launching this task to ensure that you are viewing up-to-date information.

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 10

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Utilization Trend Chart The utilization trend is calculated by dividing total labor hours by the working hours per month.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The data for chart n is pulled from the Utilization account, which is dynamically calculated. m this a a r t h all- projects, for existing employees. o is for MData non

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 11

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Hiring Plan Chart The Hiring Plan chart information is based on project-related jobs and total headcount for full-time employees.

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Oracle Project Financial Planning 11.1.2: Create Projects 10 - 12

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Project Staffing Request – FTE Project labor requisitions may be viewed in this section.

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Oracle Project Financial Planning 11.1.2: Create Projects 10 - 13

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Project Staffing Request – Labor Hrs The following chart displays project-related staffing requests.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m The data for chart n is a result of the Point of View defined in the form. m this a a r t h Mo non-

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 14

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Reviewing Resource Utilization Utilization is a metric used to compare employees’ actual time spent performing tasks against their total time. Double-click to view an employee assignment across projects.

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om ฺ c ฺ le ide c a r u Project where Wendy o G t @ Resner is assigned ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m As a resource n you can periodically review the utilization of employees to ensure m trmanager, a a h -working efficiently. If an employee is over- or under-allocated, you can review o theyoare Mthat n n Wendy Resner’s monthly allocation for the project

the assignments of the employee across all projects and take action. To review resource utilization: 1. Under Workforce Analysis, select Review Utilization. 2. In the Entity drop-down list, select an entity. 3. Review the utilization of all employees. 4. If required, double-click an employee row.

In the Employee Assignment section of this master-detail form, review the list of projects where the employee has been assigned.

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 15

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Reviewing Resource Requests Across Projects For each job, you can review requests by project. Select an entity to review total job requisitions for the entity.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m As a resource n you can review consolidated job requests for all projects in an m trmanager, a a h - review projects in detail and identify resource requests, requested hours, can o You Mentity. non Projects requesting a project incharge

Double-click a row to apply context.

headcount, and FTE. By performing a detailed analysis, you can plan for efficient staffing and opportunities to combine similar jobs. To review resource requests across projects: 1. Under Workforce Analysis, select Review Resource Requests Across Projects. 2. In the Entity drop-down list, select an entity and click Go. 3. Double-click a row to apply context. In the Requisitions by Project section, select a job and review the list of projects requesting that particular job.

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 16

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Staffing Projects Review job requests for a project, and assign existing employees to the project. Select values for the runtime prompts.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ Right-click and select ed e thi Assign Existing m am to us hEmployee. o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m After reviewing m trajobnrequests across all projects, you can select a project and review the job a h o oforn-that project. Mrequests n You fulfill resource requests across by assigning existing employees to project requests or hiring additional resources. With the Staff Projects task, you can view resource requests at the project and job level and determine whether a request can be met by an existing employee. If an existing employee has the required skill set for the job, you can assign the existing employee to the project. By assigning an employee to a request, you set the request status to Approved.

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 17

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To staff projects: 1. Under Workforce Analysis, select Staffing Projects. 2. In the Project drop-down list, select a project and click Go. 3. Review the job requests for the project. 4. Double-click a job to confirm that the employee with the skill set for the job is available. 5. In the Assign Existing Employees section, right-click the employee and select Assign Existing Employee. 6. Select or enter the following runtime prompts: Project, Labor Requisition, Job, Existing Employees, and Comments. 7. Click Launch to assign the employee to the project.

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Oracle Project Financial Planning 11.1.2: Create Projects 10 - 18

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Requesting New Hires If there are no employees available with the required skill sets, you can create a new-hire request.

Select values for the runtime prompts.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m Right-click and select m us Add To-be-hired. ha to o e m ( nsand/or its affiliates. All rights reserved. a i e r Copyright © 2012, Oracle c aka ble li Z ed sfera m As the m project owner, n you create requisitions for labor. The resource manager fulfills the a a r t h - assigning existing and available employees or by creating a new-hire o onby Mrequisitions n request.

To create new-hire requests: 1. Under Workforce Analysis, select Raise New Hire Requests. 2. In the Job drop-down list, select a job. 3. Review the projects that have an open requisition for the job. 4. In the Raise New Hire Requests section, right-click in the row and select Add To-behired. 5. Enter values in the runtime prompts for adding a new hire and click Add. Note the following: • In the Number of Requisitions textbox, specify the number of resources needed for each job. • The Grade field generates the base salary amount. FTE must be less than or equal to 1. • To-be-hired is often abbreviated as TBH.

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 19

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Recalculating Compensation Costs After entering any new-hire requests or making any changes to employee data, recalculate total compensation.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m This task calculates m tran compensation for all employees, both new and existing, in an a h o onMorganization. n

Note: This rule does not factor in merit increases in future years. You must run the Calculate Future Years Compensation Expense rule in order to factor in merit increases.

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 20

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Reviewing Total Compensation You can review total compensation costs for the entity. Select a currency.

Select an entity.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m To review total m trcompensation: an a h o M 1. Under non Workforce Analysis, select Review Total Compensation.

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2. Review the salary and other compensation to ensure that the costs are within the plan.

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 21

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Reviewing Employee Headcount and FTE Review the regular headcount and FTE for the entity.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m To review employee m tran headcount and FTE: a h Mo• Under non Workforce Analysis, select Review Employee Headcount and FTE.

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 22

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Quiz One of the tasks in Workforce Analysis is to submit equipment requests: a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 10 - 23

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Quiz Data is automatically rolled up when entered. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 10 - 24

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Quiz Compensation is automatically calculated in all future years. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 10 - 25

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Summary In this lesson, you should have learned how to: • Describe the workforce tasks related to Project Financial Planning • Calculate data to update project workforce costs • Review resources and assignments • Review resource utilization s • Review labor requests a h ) m • Assign labor resources to projects o ฺc eฺ e l c • Request new hires ra Guid o @ ent a • Recalculate compensation costs i r d ka Stuheadcount a z • Review total compensation and employee dฺ is

e e th m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 26

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Practices 10-1 Through 10-8 The practice covers the following topics: • Rolling Up Data • Viewing the Resource Manager Dashboard • Reviewing Labor Requests • Staffing Projects • Reviewing Utilization s a • Creating New-Hire Requests h ) • Recalculating and Reviewing Total Compensationฺcom ฺ cle uide a • Reviewing Employee Headcount and FTEs r o G

@ ent a i r ka Stud a z dฺ this e m se m u a h o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 10 - 27

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Analyzing and Planning for Capital Assets

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Objectives After completing this lesson, you should be able to: • Describe tasks that you perform in the application to analyze and plan for capital assets • Review equipment and utilization • Review equipment requests and assign them to projects • Request new equipment a s • Review the impact of capital requests on financial a )h statements m ฺco eฺ e l • Review and update existing assets and expenses rac Guid o @ ent • Manage owned, leased, and construction-in-progress assets a i r d a ak cost • Calculate equipment costs andฺzreview Stu details

ed e this m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 2

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Analyzing Capital Assets Asset Managers perform the following tasks to analyze capital assets: • Review requirements for capital assets by entity • Review the available capital assets and their associated expenses • Allocate assets to approved projects based on the availability, requirements, and expenses s a h ) • Decide whether to purchase new assets or lease m o c theฺ equipment on operational or capital lease, based eฺon l e c ra Guid organization's requirements o @ ent a i r • Calculate expenses of new leasedka assetstuand d request a S z them as needed, based on e the dฺ impact is to Cash Flow, h t m se Balance Sheet, and Profit am anduLoss

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h to o e m ( nsand/or its affiliates. All rights reserved. a i e r Copyright © 2012, Oracle c aka ble li Z ed sfera m Capitalm Planningahelps n you manage, prioritize, and plan for capital expenses. You can a r t h expenses for entities and track the utilization of assets across projects in o oequipment nMcalculate ProjectnFinancial Planning. By tracking assets in projects, you can get a comprehensive view of equipment, machinery, and other asset requirements across entities and then make efficient capital purchase decisions. You can plan for new tangible or intangible expenses and check the impact on Profit and Loss, Cash Flow, and Balance Sheets. You can also review expenses and adjust the timing and cost of capital spending. In addition, you can manage existing assets such as transfers, retirements, and impairments.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 3

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Required Metadata and Data Overview You import Capital Asset Planning data and metadata to manage assets and requests related to the project. The following table lists the header records and sample data for the AssetMem.csv file:

Header Record

Sample Data

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om ฺ c ฺ cle uide a r o tG @ Parent Total Major Assets ia den r a tu ak 1 Laptops S z ฺ Description (optional) Category ed e this m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe customers update existing asset data (dimensions and data) before me nsthat Oracle m recommends tra plans, either Plan or Forecast. After you update the dimensions and ha financial preparing o n M no Asset Detail

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refresh the application, you can execute asset calculations and consolidate up-to-date employee compensation plans or forecasts.

Note: The “Capital Asset Administration” section of the “Administration Tasks” lesson has information about Capital Asset Administration tasks. The following sections describe the Capital Asset data and metadata that you can update. Smart Lists Before loading Smart Lists and Smart List values, you must identify the associated product field names and entry names. To load Smart Lists, specify their product or member name in the Smart List Name column of the data load file. To load Smart List values, you enter the corresponding entry name in the Entry Name column of the data load file.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 4

You manage entries for the following Smart Lists: • AssignmentLocation • PhysicalLocation Metadata

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When you load metadata, you can add members to Asset Class and Asset Detail dimensions. Consider the following when loading metadata: • Ensure that the parent member exists in the application before loading children to it. • All of the templates can be used for single currency Project Financial Planning applications by removing the Currency dimension from the POV. The Asset Class dimension details the different categories of assets that a company owns, which are typically included in your financial statements. Asset Class is broken into: • Tangible assets: Furniture and fixtures, machinery and equipment, computers, and so on • Intangible assets: Leasehold improvements, software rights, goodwill, and so on

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m m us htoasupport The Asset Detail dimension is used tothe request of new asset purchases, either o e m ( Detail New Leased or New Owned. Asset ns individually details each new request. When you a i e r c i request standard equipment, supports asset requisitions in the Asset Detail lrequest ka lthe a e Z dimension (for d example, Equip 1, 2, 3, and so on). The Asset Detail dimension also ab Recdetailed r e e contains existing major equipment out as individual assets or groups of assets, where f m ns m possible. ha n-tra o MTo support no planning for new equipment or assets, as a starting point, Project Financial

You use the standard equipment list in the Asset Class dimension when requesting equipment for a project. At the time of the request, you specify the type of equipment required; however, you may be unaware whether it will be fulfilled by an existing asset or by new assets. Standard equipment provides a concise list of material assets that are requested for use on a project, while other types of assets are not included. Under the Asset Detail dimension, you add metadata for existing assets. The slide lists the header records and sample data for this file.

Planning provides the following line items for entering requisitions: • 50 equipment requisitions for requesting the use of standard equipment at the project level • 30 line items for planning for new leased assets • 200 line items for planning for new owned assets Administrators can add more line items based on implementation requirements

After you have finished loading metadata, you verify that the members were added by opening the Dimension Editor in your Project Financial Planning application. Data You use the Capital Assumptions and Asset Depreciation and Amortization data templates to load data related to Capital Asset Planning. Capital assumptions include data like depreciation, amortization methods, and so on. After loading the required metadata and data for Capital Asset Planning, you can associate an asset to a project. For more information on data load file order, see “Data Load File Order” in the “Administration Tasks” lesson. Oracle Project Financial Planning 11.1.2: Create Projects 11 - 5

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Analyzing Capital Assets and Equipment As a resource manager, you perform the following tasks to analyze your capital assets and equipment:

Roll up the data.

Review equipment and utilization.

Review equipment requests across projects.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi Assign equipment to projects. Review the impact on Create new equipment m am to us financial statements. hrequests. o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m You perform following Capital Asset analysis tasks: n m the a a r t h up-the data. Mo1. Roll non 2. 3. 4. 5. 6. 7.

Review the resource manager dashboard. Review resource utilization. Review resource requests across projects. Assign equipment to projects. Create new equipment requests. Review impact on financial statements.

Note: Oracle recommends that customers update existing asset data (dimensions and data) before preparing financial plans, either Plan or Forecast. After you update the Asset Detail dimension and refresh the application, you can execute the calculations and consolidate upto-date asset plans or forecasts.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 6

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Task Lists for Capital Asset Analysis and Planning The task lists for analyzing and planning your capital assets are designed to support standard process flows.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n works with asset managers to complete tasks in these areas. The project manager ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 7

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Reviewing Equipment

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe mEquipment You usem the n Overview task to see how assets are utilized, and quickly identify a a r t h -might exist. o issues Mwhere non •

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The top-left area shows the utilization percentage of equipment by month. Percentages under 100 indicate a surplus, over 100 indicates a shortage. The bottom-left area displays the number of open requisitions by month. The top-right chart shows the proportion of capital expenses for the year by category. You can drill down into each category for detailed information. The bottom-right chart shows the proportion of Capital Purchases and Equipment Operating Expenses for the year. Drill down for more detail.

To view the equipment overview: 1. Launch the Equipment Overview task under the Capital Analysis task list. 2. Review the Equipment Overview form.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 8

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Reviewing Equipment Utilization

Select an entity.

Select an asset class.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe mReview You usem the n Equipment Utilization task to review how assets and equipment are a a r t h - and asset class. You use the form to review an asset and its percentage of o byonentity Mutilized n

usage across projects. The top area displays Equipment Utilization. The bottom area displays Asset Usage Across Projects for the Asset Class and Entity dimensions selected in the top form. To review equipment utilization: 1. Launch the Review Equipment Utilization task under the Capital Analysis task list. 2. Review the Equipment Utilization form.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 9

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Asset Utilization Calculation Examples Utilization = Asset Usage (or Asset Units) / Asset Capacity •

•

200 units of laptops (UOM = Each), and 180 have been assigned to various projects, the utilization of laptops is 180 divided by 200, which equals 90%. 2 cranes (UOM = Hours) are used 100 hours on various projects. Available hours per crane is 170. Utilization of s cranes is (2 times 100) divided by (2 times 170), which) ha m equals 58%. ฺco ฺ

cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Asset Usage n Units are assets used across all projects. When calculating for m ortraAsset a h - the following: o onnote Mutilization, n •

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If the Capacity Units of Measure is specified as Each, utilization is calculated by dividing the number of units used across projects by the total number of available units (Asset Capacity). If the Capacity Units of Measure is specified as Hours, the utilization is calculated by dividing the Asset Usage by the Asset Capacity. If Asset Units or Asset Capacity is available, but not used by any project, the asset utilization is 0 (zero).

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 10

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Reviewing Equipment Requests Across Projects

Double-click a row to apply context.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe masset Reviewm new nrequirements for all projects for an entity. The top form displays total a a r t h The bottom form displays equipment requisitions by project. o onrequisitions. Mequipment n To review equipment requests across projects: 1. Launch the Review Equipment Requests Across Projects task under the Capital Analysis task list. 2. Review the Equipment Requests Across Projects form.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 11

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Assigning Equipment to Projects

Click the tab to view existing equipment assigned to project.

Double-click a row to apply context.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe mAssign You usem the n Equipment to Projects task to view current equipment assignments, to a a r t h -status, and to assign equipment to projects as necessary. o their Mchange non

As an Asset Manager, you can verify equipment requests at the project level and change the requisition status to approved, on hold, or unapproved (rejected). You fulfill the requisition by assigning existing equipment to the project. By assigning equipment to a project request, you change the status of that request to Approved. To assign equipment to projects: 1. Launch the Assign Equipment to Projects task under the Capital Analysis task list. 2. Review the Assign Equipment to Projects form. 3. From the Equipment Detailed Requests by Projects tab, you can Change Requisition Status using the shortcut menu. 4. From the Existing Equipment Availability form, you can assign existing equipment using the shortcut menu. Completed requisitions are not shown in the top section.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 12

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Requesting New Equipment

Select an asset class.

a s a Click the tab to create a ) hasset. m request for a new leased ฺco eฺ e l rac Guid o @ ent a i r ka Stud a z dฺ is Right-clickm toe add a newth e us hamrequest. o t o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m If you determine n an equipment request for a project cannot be fulfilled from the existing m trathat a h you can request a new tangible or leased asset. The equipment o onavailable, Mequipment n is marked to be filled by a new asset purchased in the future. requisition To raise a new equipment request: 1. Launch the Raise New Equipment Request task under the Capital Analysis task list. 2. Review the Equipment Requisitions and Raise New Equipment Request sections. 3. From the New Equipment Requests section, you can add a new asset, calculate an asset, review calculated details, view the impact of the request on your financial statements, and change the requisition status using the shortcut menu. Note: There is a key difference in the concept of requesting new equipment versus requesting a new hire. In planning your workforce, your new hire is not specific for a project; whereas, with new equipment requests, it typically is for a project or will be shared across projects.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 13

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Recalculating Equipment Costs

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m When you have n making changes or additions to equipment, run the Recalculate m trafinished a h - task to recalculate and update equipment costs. o onCosts MEquipment n To recalculate equipment costs: 1. Launch the Recalculate Equipment Costs task under the Capital Analysis task list. 2. Launch the RollupCapexCube business rule. 3. Click the Launch button.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 14

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Reviewing the Impact on Financial Statements

Select entity.

Double-click a row to update the data in the bottom section of this form.

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Click a tab to view the impact on the other financial statements.

om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe of capital expenses and their related costs on the Profit and Loss, me thensimpact You canm review traand Cash Flow statements. You can review the financial impact by ha Sheet, Balance o n M no department or across departments, for the same asset class, all asset classes, or one asset.

To review the impact of an equipment request on the financial statements: 1. Launch the Review Impact on Financial Statements task under the Capital Analysis task list. 2. Complete the Review Impact on Financial Statements composite form. 3. From the Cash Flow Impact form, you can view asset details by using the shortcut menu. To view asset details: 1. Open the Review Impact on Financial Statements composite form. 2. In the Cash Flow Impact form, right-click and select Asset Details, 3. Review the 5.05 Capital Expenditure Summary - Line Item Details form. - You can return to the previous form by using the shortcut menu.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 15

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Capital Planning Detail Planning: • Labor • Equipment • Materials • Indirect costs

Summary Planning: • Requisitions • Standard rates for equipment and billing

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m In Project Financial m tran Planning, you can plan, in detail or in summary, for capital assets used in a h -by planning for the Allocated Equipment Expenses of projects. In summary form, o projects Myour non you work with equipment requisitions, standard equipment and billing rates, and do not need to load or reconcile specific asset information. You load and manage standard equipment and billing rates. You perform the following tasks when planning for capital assets for your projects: • Review and update major existing assets • Add new assets, if required • Review construction in process assets • Calculate asset related expenses • Review asset-per-unit-cost detail

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 16

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Reviewing Existing Assets

Click a tab to view the other asset types.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe mReview You usem the n Existing Assets form to review and update assumptions for all existing a a r t h review assumptions by asset type: o You Massets. non • • • •

Major Existing Tangible Intangible Leased Assets All Other Minor Assets

You can update asset capacity, status, insurance rate assumptions, and so on. In addition, you can transfer, retire, and impair assets. To review major existing assets: 1. Launch the Review Existing Assets task under Existing Assets. 2. Review the Review Existing Assets form.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 17

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3. In the tabbed areas of the form, right-click for a shortcut menu to do the following: - Calculate assets. - Transfer assets. - Retire assets. - Review calculated details. - Impair assets. - Calculate intangibles. - Calculate all leased assets. - View the impact of an asset on your financial statements and view asset details.

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Oracle Project Financial Planning 11.1.2: Create Projects 11 - 18

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Reviewing and Updating Asset-Related Expenses

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe mReview You usem the n and Update Asset Related Expenses task to review and update asseta a r t h - by entity, such as insurance, maintenance, and repairs. The expenses are o expenses Mrelated non the calculated results from the assumptions entered by asset in the Review Existing Assets form. Each expense line is calculated as Basic Cost multiplied by Percentage. For example, Repairs & Maintenance is a Basic Cost, which is multiplied by Repairs & Maintenance %.

To review and update asset-related expenses: 1. Launch the “Review and Update Asset Related Expenses” task under Existing Assets. 2. Review the Manage Major Asset Expense form. 3. From the POV, select the Entity, Asset Class, and Asset Detail dimensions. 4. Review insurance, maintenance, repairs, and so on, and, if needed, update the expenses.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 19

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Adding New Assets

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m Under the New n task list, perform the following tasks: m trAssets a a h - reconcile new assets and Mo• Add non •

Add and reconcile new leased assets

You add new tangible, intangible, or leased (equipment) assets at the entity level. To add and reconcile new assets: 1. Launch the Add and Reconcile New Assets task under New Assets. 2. Review the Add and Reconcile New Assets form. 3. From the Add and Reconcile New Assets form, you can use the shortcut menu to add, calculate, remove, reconcile, change the requisition status, and view the impact of assets.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 20

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Adding New Leased Assets

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe based on the following types of leases: meleased s You canm add assets n traLease: Temporary short-term leases similar to a rental agreement. The haOperating o • n M no •

lessor, who retains exposure to the risks and benefits of ownership, generally covers the maintenance, insurance, and repair costs of the asset. Financed or Capitalized Lease: Long-term leases that last for almost the life of the asset until it is considered worthless after the lease period. The lessee effectively assumes all the risks and benefits of ownership, including maintenance, repairs, insurance, and obsolescence. The lessor’s role is primarily to provide financing for the asset. At termination, the asset is usually transferred to the lessee for a specified sum, which is similar to buying an asset in installments over time.

Consider the following criteria that Project Financial Planning applies when classifying a lease as Operating versus Financed: • Transfer of ownership at the end of the lease term • Purchase option at a certain date during the lease period at a bargain (much less than the expected market value of the asset at that time)

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 21

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The lease term is for the major part of the asset’s useful life (at least 75% of the asset’s useful life) The present value of the lease payments exceeds 90% of the initial value of the asset

Impact of leasing type on financial statements: • Operating Lease: The lease payments are recorded as operating expense (rent expense) on the Income Statement. • Capitalized Lease: - Records an asset and liability on the Balance Sheet to reflect the value of equipment (the net present value of lease payments) and the obligation of the lease payments respectively (debt) - Depreciates the asset over its useful life, which reduces the asset on the Balance Sheet and generates a depreciation expense on the Income Statement - The interest associated with the lease must be listed as an expense on the Income Statement (interest payment)

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To add a new leased asset: 1. Launch the Add and Reconcile New Leased Assets task under New Assets. 2. In the New Leased Asset Request or New Leased Asset Details form, right-click and select Add New Leased Asset . 3. Complete the runtime prompt and click the Add Leased Asset button.

om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r ce a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 22

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Reviewing Construction-In-Progress Assets

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe me allnConstruction s You canm review in Progress (CIP) assets that are in progress in an entity. You a a r t h - these assets to existing assets after the capital project is approved. CIP assets o reconcile Mcan non accumulate the costs of building an asset and are classified in the Balance Sheet as CIP until the asset is placed in service.

To review and reconcile construction-in-progress (CIP) assets: 1. Launch the Review & Reconcile CIP Assets task under Construction In Progress Assets. 2. Review the Review Construction in Progress (CIP) Assets form. 3. You can use the shortcut menu to reconcile CIP assets.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 23

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Calculating Asset-Related Expenses You use the Calculate Asset Related Expenses rule to calculate expenses for assets at the entity level.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m To calculate asset-related expenses: m tran a h -the Calculate Asset Related Expenses task under Capital Planning. Mo1. Launch non 2. Click the Launch button.

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 24

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Reviewing Asset Per Unit Cost Detail The Review Asset Per Unit Cost Detail task enables you to review the Per Unit Cost for each asset.

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d fe is calculated as the Ownership Costs plus the Operating Costs. mefor an s Per Unitm Cost asset n ha n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 25

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Quiz One of the tasks in Capital Analysis is to submit equipment requests (if needed). a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 11 - 26

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Quiz You can use the Assign Equipment to Projects task to change the status of the equipment. a. True b. False

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Oracle Project Financial Planning 11.1.2: Create Projects 11 - 27

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Quiz Which area (tab) is not part of reviewing the impact on financial statements. a. Profit and Loss Impact b. Balance Sheet Summary c. Cash Flow Impact d. Retained Earnings Impact

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Oracle Project Financial Planning 11.1.2: Create Projects 11 - 28

a

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Summary In this lesson, you should have learned how to: • Describe tasks that you perform in the application to analyze and plan for capital assets • Review equipment and utilization • Review equipment requests and assign them to projects • Request new equipment a s • Review the impact of capital requests on financial statements a )h • Review and update existing assets and expenses com leฺ idassets eฺ c • Manage owned, leased, and construction-in-progress a or t Gu @ • Calculate equipment costs and review en riacostddetails

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Oracle Project Financial Planning 11.1.2: Create Projects 11 - 29

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Practices 11-1 Through 11-7 The practice covers the following topics: • Rolling Up Data • Equipment Overview • Reviewing Equipment Utilization • Reviewing Equipment Requests • Assigning Equipment to Projects • Request New Equipment • Recalculating and Reviewing Financials

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om ฺ c ฺ cle uide a r o tG @ ia den r a ak s Stu z ฺ ed e thi m ham to us o (m nse a i r © 2012, Copyright ceOracle and/or its affiliates. All rights reserved. a i l k Za rable d e sfe m n ham n-tra o M no

Oracle Project Financial Planning 11.1.2: Create Projects 11 - 30

a