1. SUMMARY Process Definition: Finance and Contracting 1.1. This document defines the processes provided by the (F&S, or the Division) Finance and Contracting team in detail. 1.2. The relationship between this Business Unit process and the other Business Unit processes within the Division management system is illustrated in the process flow map included in the Quality Manual. 2. REVISION AND APPROVAL Rev. Date Nature of Changes Approved By 0 03/01/2017 Original Issue Tim Bateman 0A 28/03/2017 QMS Revision as a result of IAR-005 Tim Bateman 3. PROCESS DEFINITION 3.1. The Finance and Contracting team provide a range of financial services to the Division, but not limited to, the following: 3.1.1. Planning, coordination, negotiation, delivery and associated reporting related to all contracts and procurements entered into by the Division, including but not limited to all infrastructure, building and refurbishment projects and other University service provider contracts; 3.1.2. Strategic advice regarding F&S contracts and procurement processes to deliver outcomes that are compliant with University procurement guidelines and effectively meet objectives and business requirements of the Division and the University; 3.1.3. Develops and maintains professional and effective working relationships and is responsive to stakeholders from across the University s College and Service Divisions, including Finance and Business Services (in particular UPCO), external clients and contractors; 3.1.4. Budget management and reporting; 3.1.5. Ledger integrity and asset management; 3.1.6. Major capital works and maintenance reporting; 3.1.7. Commercial activity financial management for Parking, Commercial Leasing, ANU Events & Venues and ANU Apartments; 3.1.8. Accommodation system support for remotes sites; 3.1.9. Tax support; and 3.1.10. Operational activities including purchase orders, purchase cards, invoicing, cost recoveries. 4. BUSINESS UNIT PROCESS OBJECTIVES AND METRICS 4.1. The Finance and Contracting team process objectives and metrics have been derived from, and align with, the Goals detailed in the F&S 2016 Strategic Business Plan. Page 1 of 16
4.2. The objectives for the Finance process are defined in detail below and reviewed during the conduct of quarterly management reviews; see the documented procedure Management Review. 4.3. In addition, each process objective has at least one metric (or KPI) with which management can measure the effectiveness of the Business Unit process. These are also defined below and reviewed quarterly in records of management reviews. Goal 1 Review and continue to enhance finance practices and policies (Meets F&S Divisional Goals 2 & 3) Team Objective KPI Lead By By When Continually review and apply finance practices and policy in both a University and Division context. Review and effectively communicate delegation profiles to Division staff. Update F&S webpage to reflect current finance policies and procedures. Present an overview of finance structure, process and policy as part of staff induction program. Communicate and implement University led changes to financial policy and practice. Ensure that financial skills are kept updated through professional development opportunities. FM Feb 2017 FM Apr 2017 FM FM All Ongoing Ongoing Ongoing Page 2 of 16
Goal 2 Implement strong financial management processes to support managers to make comprehensive decisions on financial resourcing of the Division (Meets F&S Divisional Goals 3 & 4) Team Objective KPI Lead By By When Produce sound financial management advice. Provide analysis of the Division s financial position, including presentations / dashboards to Senior Management Group. Provide periodically financial reports to senior and enabling managers Ensure that externally funded projects are completed in the recommended timeframe and meets audit scrutiny. Develop a budget cycle that aligns with the University. Quarterly updates to enabling managers. Monthly presentations to the Senior Management Group including dashboards. Periodical distribution of management and capital reports with escalation as required. Provide a statement of expenditure that is compliant to grant conditions and assist in audit process. FM FM FM SFO SFO Ongoing Ongoing Ongoing Ongoing Ongoing Goal 3 Improved client interaction to provide transparency and accountability to the finance function of the Division (Meets F&S Divisional Goals 1, 4 & 5) Team Objective KPI Lead By By When Strengthen relationships with clients and stakeholders Improve transparency and accountability to the finance function of the Division Develop and implement a procurement handbook CM Jun 2017 Develop a budget guide & manual FM Jul 2017 Develop with PPM a cost recovery model using TM1 software FM Feb 2017 Establish a F&S Chart of Accounts FM May 2017 5. PROCESS OWNERS AND RESPONSIBLE PARTIES 5.1. The owner of this process is the Finance Manager. 5.2. The Finance Manager reports directly to the Associate Director, Corporate & Client Services, and is responsible for: 5.2.1. Planning and coordinating the Division s annual budget program, including providing assistance and advice to Divisional and University management relating to processes and principle to be adopted in formulating budget data and submissions; Page 3 of 16
5.2.2. Monitoring the financial performance of Divisional budget lines compared to budgets, and the preparation of interpretative reports for Director, Facilities and Services, senior University management, Finance Committee and Council; 5.2.3. Provide high level financial leadership and strategic and responsive financial advice to the Divisional senior management and managers across the Division on budgetary matters including budget modelling information and scenario planning; 5.2.4. Advise Divisional management on sources of funding available to meet the cost associated with emerging issues that affect the management of campus services, facilities and assets; 5.2.5. Provision of high level advice and policy direction to senior members of the Division on matters relating to budget; 5.2.6. Preparation and presentation of financial reports for F&S and F&BS Divisional management, associated with the operations of the capital (building works); 5.2.7. Lead and develop staff in the F&S Finance team to provide an excellent service, including the regular review of performance and provision of professional training; and 5.2.8. Ensure timely responses are provided to external and internal auditors as required. 6. TYPICAL PROCESS INPUTS 6.1. The typical required inputs for the Finance and Contracting team processes are: 6.1.1. Technical information needed: F&S Divisional budget (income and expenditure forecasts) F&S Division actual income and expenditure data F&S Division Fringe Benefits Tax expense data F&S Division procurement documentation F&S Division contract documentation ANU Policies and Procedures Australian accounting standards 6.1.2. Resources needed: ES Financial system OneStop transaction processing system StarRes system ANU Electronic Records Management System (ERMS) 6.1.3. Personnel needed: The Finance and Contracting team comprises five full-time positions, as detailed below: Position Level SM1 ANU 6/7 ANU6/7 ANU 4 ANU 8 Position Title Finance Manager Senior Finance Officer Senior Finance Officer Finance Assistant Contracts Manager Page 4 of 16
6.1.4. Special training needed: Refer F&S Division Training Matrix. ES Financial user training StarRes user training 7. TYPICAL PROCESS STEPS Procurement and contract management training CPA Australia aligned training courses to maintain Continuing Professional Development 7.1. The following process flow diagrams (QMS-FS-PRF-72-003 through to QMS-FS-PRF-72-011) detail the typical process steps involved in the delivery of finance and contracting services to F&S clients: QMS-FS-PRF-72-003 Utility Charges and Client Invoicing QMS-FS-PRF-72-004 Contract Award QMS-FS-PRF-72-005 Procurement and Contracting Life Cycle QMS-FS-PRF-72-006 Procurement Planning Process QMS-FS-PRF-72-007 Budget Process QMS-FS-PRF-72-008 Fringe Benefits Tax Return QMS-FS-PRF-72-009 Management Reporting QMS-FS-PRF-72-010 Adhoc Finance Reporting QMS-FS-PRF-72-011 Finance Committee Reporting Page 5 of 16
Utility Charges and Client Invoicing QMS-FS-PRF-72-003 Revision 0 20170105 F&S Sustainability Building Meters Read F&S Space Management Check Current Space Occupancy List (manual Process) Invoices Created & sent to Tenants & Commercial Entities When money is received, invoices clear F&S Finance Spreadsheet Spreadsheet updated manually for building where no meters exist Charges reconciled and invoice sent to client Spreadsheet Creates Journal Template ANU Entities Pay upfront & reconciled to Zero at end of year of year reconciliation of upfront payment matched to costs incurred Electricity Provider Gas Provider Water Provider Water not entered into any system, charges apportioned based on number of fixtures Client Charge Correct? Page 6 of 16
Contract Award QMS-FS-PRF-72-004 Revision 0 20170105 Client Requests contract Stakeholder Input Stakeholder input: innovative ideas, KPIs & targets Delegate F&S Contracts Supplier Authoring Contract Obtain Senior Management commitment and involvement Senior Management Commitment Identify and assign responsibilities Identify resource needs Management input Contract Negotiations Negotiate with F&S and Clients Amendments Ideas discussed with all stakeholders Draft Contract Approve Contract? Contract Award Establish Performance Management regime Management input Auditing and Reporting END Page 7 of 16
Procurement and Contracting Life Cycle QMS-FS-PRF-72-005 Revision 0 20170105 Step 1 Planning Identify Needs Market Research Procurement Advice (S1) Business Case (S2) Project Plan Step 2 Approach To Market (S4b) Tender Evaluatio n Report Negotiation (S4a) Tender Evaluatio n Report Evaluation (S3) RFx/EOI Contract lifecycle Step 3 & 4 Contract Award & Implementation (S5) Contract Award Contract register and reporting Contract Contract managment Contract life Cycle Contract Administration Variation, Extension or Termination (Go to step 5) Contract (Go to step 7) Step 5 & 6 Variation & Administration Identify Variation type Procurement type (V1) Revise Business case (V2) Revise project Plan (V3) Contract Amendment Contract Register and reporting Step 7 Transition Out (S2b) Close project Plan Filing and Archive Page 8 of 16
Procurement Planning Process QMS-FS-PRF-72-006 Revision 0 20170105 Client Identify Requirement Delegate UPCO F&S Business Unit Prepare Market Documentation UPCO templates used to prepare Market Documentation DRAFT Market Documentation to Delegate for Approval Review Review or? Approved? Receive Tender Responses Advertise and Issue Market Documentation Evaluation of Tender Responses Due Diligence, Negotiations and Contract Evaluation Report to Delegate for Approval Approved? Contract Transition / Commence Performance Contract Execution All signatures obtained Page 9 of 16
Finance & Contracting Budget Process QMS-FS-PRF-72-007 Revision 0 20170105 F&S Team Forecast / estimate income Forecast / estimate expenditure Provide explanation of variance Finance Team Prepare Divisional budget submission TM1 Record the forecasts (ie budget) in ES Financial Record the actual receipts and expenditures in ES Financial Generate report on variance (ES Financial calculates difference between budget and actual amounts) Investigation and explanation of variance SMT Review Divisional budget submission Approve Divisional budget submission? Agree to variance? Review investigation and explanation of variance F&BS / EDAP Approve F&S Divisional budget? Page 10 of 16
Finance & Contracting Fringe Benefits Tax Return QMS-FS-PRF-72-008 Revision 0 20170105 Finance Team Review Divisional FBT transactions Complete FBT submission (F&BS template) Finance Manager Review FBT submission orse FBT submission? Director, F&S Review FBT submission Approve FBT submission? Review FBT submission Accept FBT submission? F&BS Compile with other University FBT submissions Submit to ATO Page 11 of 16
Finance & Contracting Management Reporting QMS-FS-PRF-72-009 Revision 0 20170105 Management Report template Finance Team Generate report from ES Financial Review/analyse/ adapt into reporting template Reconcile management report Finance Manager Provide feedback on management report orse management report? Review management report F&S SMT Provide feedback on management report Approve management report? Review management report Page 12 of 16
Finance & Contracting Adhoc Finance Reporting QMS-FS-PRF-72-010 Revision 0 20170105 Finance Manager Finance Team F&S Business Unit / Team Generate report from ES Financial Request finance reporting Review/analyse/ adapt into reporting template Provide feedback on finance report Provide feedback on finance report Reconcile report Review finance report Approve finance report? Review finance report orse finance report? Submit report to client Page 13 of 16
Finance & Contracting Finance Committee Reporting QMS-FS-PRF-72-011 Revision 0 20170105 Finance Manager Generate Financial Report for project Generate Narrative Report for project Review updated Financial and Narrative Reports Accept project Financial and Narrative Reports? Compile Finance Committee Report Project Coordinator Review draft Financial and Narrative Reports Update draft Financial and Narrative Reports Director F&S Approve Finance Committee Report? Review Finance Committee Report Provide feedback on Finance Committee Report Chief Financial Officer Review Finance Committee Report Accept Finance Committee Report? Provide feedback on Finance Committee Report Page 14 of 16
8. TYPICAL PROCESS OUTPUTS 8.1. The typical results (outputs) of the process are as follows: 8.1.1. Product produced: F&S Fringe Benefits Tax submission 8.1.2. Documents or technical information produced: F&S Annual Budget F&S Monthly/Periodic Financial Position Reports F&S Project Financial Reports Finance Committee Reports 8.1.3. Records produced: F&S Contract documentation Bank Guarantees 8.1.4. Services produced: 9. RELATED RISKS F&S financial advice and guidance 9.1. The following risks are identified related to this process. 9.2. Management may elect to conduct a formal risk assessment for any of these risks; the preferred method of risk assessment is the ANU Risk Management Framework. Page 15 of 16
Risk Likelihood Consequence Assessment Score Mitigation Unrealistic client expectations Likely Moderate Moderate - Ongoing client engagement to determine client requirements. - Educating clients in financial obligations and constraints. Fraud in financial management and activities Possible Moderate Moderate - Ongoing staff training in fraud awareness and prevention. - Actively manage financial delegations within F&S. - Implementation of sound financial management processes and procedures. - Internal and external audit of financial management and activities. Probity issues related to procurement activities Possible Moderate Moderate - Ongoing staff training in probity issues. - Implementation of sound procurement and contracting management processes and procedures. - Internal and external audit of procurement and contracting management and activities. Page 16 of 16