US Accounting Standard ASU 2016-01 - Financial Instruments

Normally my blog posts are about FCCS or HFM tips, features, etc. but this one is about an accounting standard now effective in the USA. But since FCCS and HFM are consolidation products, knowing and understanding the accounting involved is a necessary component of successfully working with the products. Plus this change will have a minor impact on FCCS/HFM usage.

Over the last few years there has been a shift in the accounting community away from historical cost and toward fair value accounting. In that vein, ASU 2016-01 was issued in January 2016 by the FASB. For publicly traded companies it is now effective (technically, effective for fiscal years beginning after December 15, 2017). The changes to GAAP, briefly, affect:

• accounting for equity investments
• accounting for financial liabilities under the fair value option
• presentation and disclosure requirements for financial instruments
• guidance related to the valuation allowance assessment when recognizing deferred tax assets from available-for-sale debt securities

IFRS 9 is the equivalent within the IFRS standard. I'm not going to go into everything in the ASU - the big accounting firms covered this well when the ASU was released - but I do want to focus on a couple things.

Equity investments need to be valued at fair value, with any change being recorded through earnings on the income statement. This requirement excludes investments that are accounted for by the equity method or those that are consolidated into the owner. So this change does not impact consolidated entities. The grouping of entity investments as trading or available-for-sale goes away as well as recognizing unrealized holding gains/losses for these entities.

A journal entry will be needed to adjust the value of the asset with the offset to the income statement. Companies will probably book this entry in the general ledger but could also book it in FCCS/HFM. The amount of the entry will also need to be used in the preparation of an indirect method cash flow statement as an adjustment to net income, as this is a non-cash item. For companies holding trial balance data for these entities inside their FCCS/HFM application the entities are typically outside of the main company hierarchies and no adjustments there will be needed.

Another change revolves around presentation of financial assets and financial liabilities. These should be presented by measurement category (like fair value) and form (securities, loans, receivables) in either the statement of financial position or in the accompanying notes. If presenting in the statement, then within FCCS/HFM account hierarchy changes and most likely new accounts will be required.

FCCS - First Look at Advanced Consolidations

The December 2017 update to FCCS will include advanced consolidation, meaning support for multiple types of ownership in the entity hierarchy. This is a first look at the function. For users of HFM and Enterprise, this will look very familiar.

First, when the update rolls out, it has to be enabled in Enable Features. This can be done without rebuilding the application.

There are two main screens that show the feature. The first is Manage Ownerships.

First, use the point of view to select the entity hierarchy, scenario, year, and period. Then you can adjust the ownership percentage, control (yes/no), and consolidation method (more on this below). This does allow organization by period (where an entity may roll into a parent one period but not the next).

The next relevant screen is Manage Methods (selected from the Actions dropdown above). Methods define different types of consolidations.

For each method, ownership ranges can be assigned to determine when a method should be assigned to a relationship. The methods can also be selected manually in the Manage Ownership screen above.

The calculations, target accounts, etc. for each method are seeded, meaning not changeable. This is expected to change soon, where customers can configure what happens.


Looks solid!

HFM 11.1.2.4.206 PSU

PSU 206 for HFM 11.1.2.4 came out on Nov 27, 2017. There are no new notable features included in this patch, but there are a whopping 53 defects and enhancements. They run the gamut from journals to task audit to security to infrastructure to IC matching to data grids to everything. There are three framework patches required along with 206 and a FDMEE PSE, so don't forget those. Also, FDMEE and Financial Reporting haven't been patched lately, but if those PSUs aren't up-to-date then now is a good time.

FCCS - what if parent accounts are not populating?

Working on a FCCS project and came across an issue. Built the main income statement hierarchy using the seeded hierarchy and that worked well. Created a second, alternate hierarchy using shared members and the shared members worked well but the parents of those shared members had no data. Using the new simplified dimension editor (which currently doesn't allow you to add a shared member so you have to use the old one but anyway) all of the attributes looked good. Got some help from a friend at Oracle and turns out there is a property that needed changing. And the best place to do it, right now, is the dimension editor in Smart View.

In our case the parent accounts, like 4050000, had no data. You think setting the Default Data Storage (shown twice in columns C and G) as Dynamic Calc would be enough but it's not. If you look at the columns, there is one that doesn't show in the simplified editor called Consol Data Storage - column F. For the parents this needs to be Dynamic Calc as shown. When the hierarchy wasn't working it was Never Share.  So, click the cell, get the dropdown and change to Dynamic Calc (or copy/paste) and then click Submit and refresh the database.

Overall I'm having fun with FCCS but it does remind me of the first year or two of HFM, where Enterprise was so mature and HFM was less so. But I'm also seeing a faster ramp-up of FCCS compared to HFM, so that's good.

Have fun!

FCCS - Exchange Rate Type for Accounts

Working with FCCS, one of the account properties is Exchange Rate Type. There are multiple choices as shown here from the Simplified Dimension Editor.

Looking at the choices, you might be tempted, as I was, to use Average for income statement accounts and Ending for balance sheet accounts. After all, the two account types usually do currency translation at the respective exchange rates. Or, you may be thinking Average for the balance sheet accounts since the Time Balance property should be Flow (not Balance - and yes, it should be Flow, not Balance) because of the movement dimension information.

But, as it turns out, the correct answer (with one exception) is No Rate. Not exactly sure why, but apparently FCCS already knows what to do.

The exception is if a balance sheet account needs a historical translation. Those three are okay to use. If an override is used, either rate or amount, then pick the appropriate choice. If an account is historical but does not contain an override (the help uses the example of Retained Earnings) then select Historical.

FCCS October 2017 Updates and Key Upcoming Changes

Coming to test on Friday, October 6 and production on Friday, October 20 during the specified maintenance window.

https://blogs.oracle.com/proactivesupportepm/fccs_1017

Two key notes regarding later releases - not in October but in "the next few months." Advanced consolidation features are on the way and dimensions will be limited on the number of members.

Lastly, this release introduces the "Simplified Dimension Editor," which displays dimension members in a grid. With the February 2018 release, the "Classic Dimension Editor" will no longer be supported.

FCCS - Using a company logo

As I spend more and more time with FCCS I'm seeing where there have been lessons learned from the prior products. One of the simple sounding things to do that wasn't all that easy before is customizing the interface to use a company's logo. In the past with HFM, depending on the version, it usually involved replacing the system delivered files with custom ones and then remembering to replace them after each patch or upgrade. Now, with FCCS, it couldn't be easier.

After logging in, click the Tools card (yes, those icons or tiles or buttons are called cards) and then select Appearance.

The appearance window will appear. Specify a URL for the logo and/or background. The Theme refers to the color used for title bars and the like and Shape refers to the button style.

Here, we're just changing the logo image. There is a reset button if you want to restore to the defaults. After clicking OK, the image is brought in and you're done!

Book Review - Oracle FDMEE Scripting: Essential Elements

I like to learn about things that I'm not an expert in: basically, I'm learning all the time. To that end, I picked up a copy of Tony Scalese's new book on FDMEE, called Oracle FDMEE Scripting: Essential Elements.

There is an assumption of knowledge, as Tony mentions, about FDMEE and some core concepts. This is not an "overview of FDMEE" book. His other book, The Definitive Guide To Oracle FDMEE, would help with that.

There are three chapters in the book. The first chapter deals with syntax and the right way to do things, from simple indenting and case sensitivity to more complicated scripting techniques like error capturing. The second chapter explores the FDMEE Java API by listing many of the methods and associated keys available when developing scripts. The last chapter gets into script development and debugging, including an introduction to FDMEE development mode, where scripts can be tested without impacting data.

Throughout the book are code examples to illustrate the point being made, which are helpful in seeing a particular technique, key, etc. being applied.

What I would like to see more of are a few common FDMEE scripts with notes that apply the knowledge in the book to the scripts. The book covers all of the pieces, but there's no overall example that ties them together. Like show a smart replace event script and point out the classes being imported, the indenting, the use of fdmContext, etc. Or a batch script that runs a data load rule, executes the check validation report, and then emails the log and the check report to the admin with the lessons being applied from the chapters. Reminds me of a Stave jigsaw puzzle, where you get the elegantly crafted pieces but not a picture of what they look like when put together.

If you are an FDMEE administrator with an implementation that was done by consultants or are new to the job, this will be a great book for you. Review the scripts you have, read the book, and then review the scripts again now that you know more about the syntax and the techniques. If you are new to writing FDMEE scripts and don't have a folder of scripts to refer to, you may want to do some looking around (Oracle forums, blogs, samples, Google, etc.) to find a few to provide some context.

Overall, a good book to understand FDMEE scripting. Here's the link to it on Amazon.com:

Oracle FDMEE Scripting: Essential Elements

Also, if you're going to Kscope, Tony will be there and I'm sure glad to sign your copy.

Member Selection in FCCS

For those who are switching from HFM (or Enterprise for that matter) to FCCS there are a lot of things that will seem familiar. You have journals, consolidation, hierarchies, Financial Reporting, FDMEE (lite), intercompany matching (and thank goodness it's with the Enterprise side by side format), and more.

One simple, more practical area where things are different is with member selection. This may seem trivial, but it is learning small things like this that make using the product easier to pick up. You focus more on what you're doing vs. wasting time on how to do it.

In Enterprise, member selection was a simple dialog box with a list or hierarchy of members, you select one, and click OK. Sorry, I don't have Enterprise up and running to show a screenshot.

In HFM, member selection is typically a dual sided dialog box with available choices on the left and the selected item(s) on the right and clicking the chevrons (not shown below) in the middle to add/delete or select a relationship.

In FCCS, and I'm pretty sure the same goes for EPBCS/PBCS as well, member selection works a little different. There are two main flavors.

This first example is from journals. There are tabs across the top for each dimension instead of the dropdown of HFM. Start from the left and click on parent members to drill down to the children in the next column - if you keep clicking, like on USA, the screen scrolls to the right to keep drilling down. But the question comes: how do you select a member? In the screenshot, there are three entities selected (gray boxes) - which one will be in the point of view when OK is clicked?

The answer is none of them! The selected entity is Latin America in the center column - note the checkmark to the left of the label. So, to select an entity, you must click the whitespace to the left of the member to place the checkmark. Clicking the entity itself does not place the checkmark. Think Smart View member selection, where you have to click the box and then click the chevron.

The other primary member selection box is seen in intercompany matching reports, where a relationship (think list in HFM and Enterprise) is needed. This screen has the same columns (in the middle and right) for the drill down as above and the same blue checkmark (see North America in the right column), but the additional bit shows in the LEFT column. 

This column shows a relationship selection. To do this, hover over a specific "anchor" member and the fx icon will appear. When clicked, the various relationships will appear. The equivalent of "base" members is "Level 0 Descendants," which highlights the Essbase underpinnings of the product.

Note that multiple items can be added to the left, whereas HFM typically would only allow one list/relationship to be added to the point of view.

Also, as seen in the bottom of the second screenshot above, this panel can be toggled from Members to other choices depending on the design of the application.

A huge benefit to all of this is you can do this from your phone/tablet. This screenshot was taken from an Apple iPhone using the standard Safari web browser.

Member selection is a little different, just like Enterprise to HFM was a little different but in the end you get what you need.

Appearing in Oracle Magazine

Normally I keep a low profile, which is probably not a good idea for a consultant. But thought I'd share that I'm in the current issue of Oracle Magazine in the Peer to Peer column. Here's the link (I'm #3 in the column).

http://www.oracle.com/technetwork/issue-archive/2017/17-may/o37peer-3708336.html

HFM Command Line Automation

Happy May to everyone. I got the idea for this blog post from a client who wanted to maintain and manage HFM from CA-7 jobs; basically where you do things from a command line on a scheduled basis. HFM isn't really geared for that; but, there is a legendary, mythical way to do pretty much everything!

For versions prior to 11.1.2.4 there is a third party utility called HFM Batch that can be used to do this, but it doesn't work with 11.1.2.4. Fortunately there is a solution - from Oracle and included with HFM - and it goes all the way back to the early, early days of HFM. Some documentation I have on the technique is dated circa 2003.

So, what you do, is .....










ATTEND KSCOPE17!    www.kscope17.com


Seriously, at KScope17 there is a presentation that covers this specific topic (Monday, 10:30am). I don't want to steal Beatrice's thunder, especially since she recently helped me with the topic, but she's going to cover it all then.

And to save $100 when registering, use code 123OLAP - you'll see a field where you can enter this.

Hope to see you in San Antonio!

P.S. Here's a sneak peek:

HFM - Knowing Which Environment You're In

This blog post comes about because of LifeCycle Management ("LCM"). It's fine as a tool to migrate things (called artifacts) from one environment to another but I don't use it a lot because HFM has native import and export capabilities for most things already. LCM works better when the application has the same name in all environments, which I don't like: I like knowing where I am. 11.1.2.4 addresses this somewhat - if you're migrating from one HFM app to another and they're called different names and the LCM import doesn't find the same application name, it will prompt you to select one. But try this with a task flow and you won't get prompted and you'll end up with a task flow that doesn't work since the embedded application name didn't get changed (believe me, I tried).

The obvious answer to this is to call the application name the same in all environments, and most people do that. But here's the problem. Within rules, we typically want rules to do different things in dev vs. QA vs. production. If you're doing write to file, for instance, you'll want different file paths for each environment. If you're sending emails for your metadata diagnostics (you are sending emails for your metadata diagnostics, right?) we want to have different addresses, different email subject line, etc. If the application name is different, then you can use HS.ApplicationName to find out where you are. But if you're being LCM-friendly, that's not going to work.

So, what to do?

Fortunately, VB script has a way to find out where you are. You can use two simple lines to capture the computer name (server) that is running HFM. So, in your rules, do something like this:

set wshShell = CreateObject("WScript.Network")

strComputerName = wshShell.ComputerName

Then, after that, use if/then or select case to look at the computer name and set the path or whatever you're doing. If your environment has multiple HFM servers, then include all the server names.

Select Case strComputerName

   Case "DEV01"

      location = "\\dev\fileshare\file.txt"

   Case "PROD01", "PROD02"

      location = "\\prod\fileshare\file.txt"

End Select

This allows you to know where you are and still be LCM-friendly. If you're running on Exalytics, you may need to tinker this a bit. I've had multiple Exalytics clients but for some reason they all still put HFM out on separate Windows servers - weird.

Anyway, have fun knowing where you are.

EPM Automate - DOS style automation for Oracle EPM Cloud

Ever heard the phrase "history repeats itself" or "something out of fashion will become popular again"? EPM Automate is a good example.

EPM Automate is the automation tool for the Oracle EPM cloud products: EPBCS, PBCS, FCCS, ARCS, etc. It allows users to log into the cloud, perform various actions, and log off. It can be run interactively or scripted and then scheduled.

The "history repeating itself" piece of this comes from the user interface and the scripting language: MS-DOS command line and MS-DOS batch file (or PC-DOS if you got your copy of DOS direct from IBM instead of Microsoft or a clone manufacturer). Or if you've ever used the command line on a Unix computer - did you know Apple's Mac OS X is a Unix operating system? - then you'll feel right at home. A DEC VAX had something similar but the language was different.

Actually the idea of a cloud environment harkens back to mainframe computing, so "what goes around comes around." Ok, no more phrases.

Anyway, the first step is to log into the cloud product and download the installer - works with Windows or Linux (64 bit versions only). As the cloud environment is updated each month, the downloaded program should be updated each month too.

After the install, launch the program from the menu. You're basically put into a command line environment, complete with drive/folder> and blinking cursor. Type in what you want to do, like login, and then get a response back. If you don't know what you can type then enter "help" and get a list. For help on a specific command, type the command and then help, like "login help".

For automating, write a batch file and then schedule that with Windows Scheduler, CA-7, etc.  I'm tempted to use EDLIN as the text editor, just for the full 1980s DOS effect.

Notice I'm skipping screenshots for this post - Oracle has a YouTube video that shows you how it works - this video uses PBCS for the cloud product.

https://www.youtube.com/embed/1lUthzzoWEY?rel=0&autoplay=1


For full documentation on EPM Automate, go to:
https://docs.oracle.com/cloud/latest/epm-common/CEPMA/CEPMA.pdf


Overall, a simple and easy way to work with the Oracle EPM Cloud products. I wish they'd make this available for HFM - I like it better than task flows. HFM Batch (Google it) was similar but wasn't replaced when 11.1.2.4 (with no Windows API) came out.


P.S. With good ideas from the past being brought to bear in current day solutions, I wonder when keypunch cards are coming back. I need a new holiday wreath (search Pinterest).

Viewing Metadata Properties within HFM

For HFM admins, making life easier is about automating something, a new calculation, faster consolidation, etc. But for end users, making life easier tends to be about simple stuff. Show me something quick that can make my life easier.

One of the questions end users have is what are the attributes of this account, entity, etc. - the metadata properties. For years administrators have put this information out to Excel files (the HFM Toolbox utility for versions before 11.1.2.4 was great at this).

But within HFM itself, there are some things that can be done.

In the mid 2000s a field was added to the accounts called Calculation Attribute. It provides 100 characters or so for the admin to type in how an account is calculated. The history for this goes back to Hyperion Enterprise that would show the calculation for a calculated account in the Data View window. In HFM right-click a cell (data grid or form), select Cell Information and you'll see the Account Calculation Attribute if it has been provided.

That's all well and good, but what about the metadata attributes? Asset or liability? What custom dimension top members? For this information, there is a simple solution. Right-click the metadata item (I'm using account ROA in the rows here) and select Member Properties.

Once selected, a popup appears with all of the information an end user would want to know. The screenshot does not show all of the attributes, but they are all there.

So simple and available from grids and forms (but unfortunately not Smart View).

HFM 11.1.2.4.204 PSU released

The 204 PSU was released today for HFM 11.1.2.4. Below is the list of defects fixed in the patch. Personally, I'm glad to see the issue with extracting data to an Oracle database requiring TNSNAMES getting fixed. This has been a thorn in my side at my current project.

Have fun patching!

Defects Fixed in this patch

Defect Number	Issue
25352846	Lcm epmhfm-66115: an error occurred reading metadata file content for data form
25346829	Hfm journal report:turkish characters are not exported correctly
25111633	Email alert doesn't work on entity security class
25099054	New option to limit number of concurrent consolidations per user action
25085411	Hfm application crashing when using fdmee data extracts
25023506	Cannot run consolidation after applying hfm 11.1.2.4.203 patch from taskflow
24970914	Issue with grid-invalid intersection in the pov with psu 203
24912844	Getting an error "an invalid security key was specified" in system messages
24911708	Consolidations running server out of memory
24850722	Submitting cell text in data forms does not work in smartview
24835551	Ic reports aborts running reports concurrently
24701675	Overlap consolidation is running for wrong parent in process control grid
24615995	Error retrieving datagrid in api demo.java sample code
24569482	Non admin users are not able to see their "running tasks"
24417229	Process level can be promoted even though validation fails
24389966	Unknown error happens in metadata load and application crashes
24297212	Cannot delete security class from shared services for hfm epmaapp
23725599	User getting adf_faces-60097 error opening hfm application from ie11
23704850	Hfm application opens to white screen after doing opening journal form filter.
23562417	Metadataom.findmembers() returns the member instead of null
23299237	Hfm process crashing on startup on exalytics
23194007	Hang up in active not turn into failure when stage has an issue like no data file
23101101	Hfm dsn export not exporting all member descriptions
22342743	Not possible to override system settings - name field in override window is empty
22322353	No access/metadata issues when accessing smartview(recurring issue)
21840787	Filtering does not work in data audit
21480292	Intercompany report uses the wrong column width settings
21112270	Unable to promote the entity to next level if using a system defined memberlist
20546956	Unable to transform classic hfm linux app to epma
19323855	Extract data to oracle db requires tnsnames
18922785	Cannot select books when creating related contents in hfm

To Lock or Not to Lock - That is the Question

When I talk with clients and other consultants, one of the most controversial topics is whether to lock entities or not. When you lock an entity, no one, including the administrator, can change data in the entity. If the entity is a parent entity, then changes to the entity hierarchy (like removing a child) do not impact the locked entity.

There are two different concerns that companies address with locking: preventing data changes from input and preventing changes from hierarchy movements. The big concern that people have with locking, however, is application rebuilds: if parent entities are locked and changes have been made, it will be (and is) a nightmare to make everything tie out again.

So, lock or don't lock?

I'm not a fan of locking. But I realize the concerns above are valid, so what do you do if you don't lock?

For preventing user changes to data, I prefer to promote the data with process control to where the users cannot make changes and trust the admin not to do something crazy (process control has no effect on administrators).

If you do want to lock, consider locking just the base level entities. That will prevent anyone from making data changes but not cause a problem with a rebuild. 

So if you want to lock parents so that hierarchy changes don't cause impacts, then think about if you have a lot of changes. If not, use alternate hierarchies and/or new entities. But if you do have a lot changes, then consider activating organization by period which is designed for this. 

To me, locking the parent entities is the last thing I want to do. But if you do, keep a version of each month's hierarchy offline (metadata extract) so you can compare back and reconcile when rebuilding. 

Note: locking only protects entities. Parent accounts and parent customs are dynamic calc, so any hierarchy changes in these dimensions will apply to history. Nothing you can do except maintain alternate hierarchies. 

With upgrades many times you can migrate and update the database directly without a rebuild so locking wouldn't be a problem. I've also seen clients keep an archive version of the app each year but that's rare.

But I still wouldn't lock parent entities. 

Oracle Data Visualization Cloud Service

For 2017 I thought I would start with something different. I recently spent some time working with the Oracle Data Visualization Cloud Service ("DVCS" from here on out). I had seen a preview of this product before its release and thought it looked great and wanted to try it out.

DVCS is a presentation tool. You provide it the data, it makes sense of it and presents it. The data can come from Excel or various Oracle products. HFM isn't one of them, though.

For this test, I used some data from a recent wine tasting. Note the column headers will be helpful in working with the data later.

Click Data Sources and then click Create New Data Source to add the source (or in the case of Excel upload the file).

Once uploaded, return to Home and create a new VA Project. Once the data source is selected, the different fields can be clicked and dragged to the project - rows, columns, etc. The type of chart can be chosen and table layouts are available too for those who just want to see data.

With this setup below, I'm showing the tasters across the x axis for each wine and filtering the results (located above the bar chart selection) to taste. A score of 5 is good, 1 is bad.

With the above setup, we can see that Honig, Worthy, and Brookman were the leaders.

Changing the setup to a donut chart, removing the tasters, and changing the filter to total score, we can see that the Honig was the winner, with Brookman just beating Worthy for second.

Look at the bottom of the screenshot. Commentary can be added to provide context, etc. For the seven wines we tasted, 14 Hands Hot to Trot was not the best scoring wine, but for the price it provided (in our opinion) the best value.

There are other capabilities of DVCS: blending data (using more than one data source together [think joining tables]), calculations based on the data, multiple visualizations on one page, etc. But hopefully this gives you a good start to it. The Academy is a good starting point (as with all of the cloud offerings). This serves as a one-stop shop to docs and videos to get you started.

If you're able to sign up for a free trial, like I was, the product is worth a look. It also gives you some practice on how Academy and Console work which are applicable across many of the Oracle Cloud offerings. If the trial isn't available, or you just want something quick, then take a look at the videos.

http://docs.oracle.com/cloud/latest/data-visualization-cloud/data-viz-cloud_videos.htm