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Finance Transformation in Financial Services: Solution and Case Study Review Bill Greene, Global Solution Manager, Oracle Michael Hernandez, PNC Financial Services Vas Rao, CIBC John Van Puffelen, TIAA CREF Slide 2 2 Copyright 2013 Oracle and/or its affiliates. All rights reserved. Confidential Oracle Restricted Are you in the Right Room? Optimize Processes for Consistent, Repeatable and Efficient Finance and Risk Greater Data Transparency and Strong Links between Finance and Risk Availability of Reconciled, Detailed and Timely Data Address todays Regulatory Challenges Comprehensive Daily, Weekly, Monthly Perspective of Risk and Finance Information Slide 3 3 Copyright 2013 Oracle and/or its affiliates. All rights reserved. Confidential Oracle Restricted Agenda Setting the Stage Challenges and Approach (10min) PNC Financial Services (15min) CIBC (15min) TIAA CREF (15min) Questions and Answers (15min) Slide 4 4 Copyright 2013 Oracle and/or its affiliates. All rights reserved. Confidential Oracle Restricted Speakers Michael Hernandez, SVP Accounting Operations, PNC Vas Rao, VP Finance Services Group, CIBC John Van Puffelen, VP Corporate Financial Planning and Analysis, TIAA CREF Slide 5 5 Copyright 2013 Oracle and/or its affiliates. All rights reserved. Confidential Oracle Restricted Enterprise Risk and Finance Challenges Risk and ComplianceCost and Efficiency Operationalizing Risk and Finance $ Slide 6 6 Copyright 2013 Oracle and/or its affiliates. All rights reserved. Confidential Oracle Restricted Management Reporting & Analytics Regulatory Reporting Enterprise Risk and Finance: The Approach Data Preparation Data Sourcing Accounting Analytical Enrichment Slide 7 Michael Hernandez SVP Accounting Operations Michael.hernandez@pnc.com Slide 8 8 Overview NCC Acquisition in 2008, catapults PNC into Core Bank ranks for Basel reporting Financial crisis leads to expanded reporting and compliance requirements Increased systems and data complexity Slide 9 9 Focus of Office Of Finance Historically: Minimal investment in finance technology Cost reduction environment Acquisition support priorities Focus of operating system enhancements Product and customer priorities versus accounting & finance needs Resulting In: Current finance information processes have become complex & fragmented Dependent on manual data manipulation to cope with the increase in analytical needs and reporting requirements both internal and external Slide 10 10 Finance Transformation Journey (So Far) 20092010201120122013 Integrate NCC systems Acquired Loan Acctg.(SOP 03-3) Financial System Gaps Integrate NCC systems Acquired Loan Acctg.(SOP 03-3) Financial System Gaps Create Finance Project Management Office Hyperion Essbase Basel Compliance Create Finance Project Management Office Hyperion Essbase Basel Compliance Oracle DRM SEC Reporting Enterprise Information Platform Reconciliation Oracle DRM SEC Reporting Enterprise Information Platform Reconciliation Finance Transformation Strategy Peoplesoft Upgrade SEC Reporting Phase 2 Finance Transformation Strategy Peoplesoft Upgrade SEC Reporting Phase 2 OFSAA Financial Accounting Hub Hyperion Planning Refine/Expand Strategy OFSAA Financial Accounting Hub Hyperion Planning Refine/Expand Strategy Slide 11 11 Integrated Financial Systems Blueprint Common Data Platform Slide 12 12 PNC Financial Systems Ref Architecture Slide 13 Vas Rao VP, Finance Services Group Slide 14 Copyright 2012, Oracle and/or its affiliates. All rights reserved.Insert Information Protection Policy Classification from Slide 12 14 Slide 15 Copyright 2012, Oracle and/or its affiliates. All rights reserved.Insert Information Protection Policy Classification from Slide 12 15 Copyright 2013, Oracle and/or its affiliates. All rights reserved. 15 Who Are We? CIBC (CM: TSX; NYSE) Canadian-based global financial institution 42,793 employees 11 million individual, small business, commercial, corporate and institutional clients 3,456 bank machines 1,103 branches Valuation (Jan 31/13): Dividend yield: 4.5% 1 Canada Rank is relative to the other 5 major Canadian banks (BMO, BNS, RY, TD, NA). 2 North America rank is relative to the other 5 major Canadian banks and JPM, BAC, C, WFC, USB, BK, PNC, STT, COF, STI, BBT, RF, FITB. Slide 16 Copyright 2012, Oracle and/or its affiliates. All rights reserved.Insert Information Protection Policy Classification from Slide 12 16 Copyright 2013, Oracle and/or its affiliates. All rights reserved. 16 Financial Data Challenges 1.Data feeds from multiple sources 2.Limited ability to drill down for ad hoc analysis and investigation 3.Time spent finding data, scrubbing data, formatting data and presenting data as information 4.Manual reconciliations 5.Variable definitions of data and calculations Slide 17 Copyright 2012, Oracle and/or its affiliates. All rights reserved.Insert Information Protection Policy Classification from Slide 12 17 Copyright 2013, Oracle and/or its affiliates. All rights reserved. 17 Our Guiding Principles The technology that supports Finance was built for a single purpose and at a point in time. As our regulatory demands continue to increase we know that our Technology has to evolve. Data Standardization Finance centrally governs data definitions and standards Thick & Thin Ledger A Financial Data Warehouse (FDW) and GL containing all financial data Results between GL and FDW are reconcilable and the reconciliation process is highly automated Data Processing Management Flexible reporting to drive on demand analysis, insights and business discovery Reporting Slide 18 Copyright 2012, Oracle and/or its affiliates. All rights reserved.Insert Information Protection Policy Classification from Slide 12 18 Copyright 2013, Oracle and/or its affiliates. All rights reserved. 18 Target State Architecture Slide 19 Copyright 2012, Oracle and/or its affiliates. All rights reserved.Insert Information Protection Policy Classification from Slide 12 19 Copyright 2013, Oracle and/or its affiliates. All rights reserved. 19 The S4 Return provides Statistics Canada with information relating to Assets Under Administration (AUA). Information from this return will be used to compile estimates of assets which are held for retirement purposes Background Finance has been manually collecting data and preparing reports, on a best efforts basis and at a summarized level, for approximately 60% of the Banks AUA for the past 3 quarters but the regulations have changed. Statistics Canada is now asking for 100% of Banks AUA at a granular level by calendar Q3 2013 Issues Scalable Technology Solution The S4 Return provides Statistics Canada with information relating to Assets Under Administration. Information from this return will be used to compile estimates of assets which are held for retirement purposes Leverageable Data Acquired larger population of data Data is reusable to the enterprise Standardization Enable automated and standardized reporting (e.g. Mutual Funds Sales Reporting) Fiscal 2013 S4 Case Study Slide 20 Copyright 2012, Oracle and/or its affiliates. All rights reserved.Insert Information Protection Policy Classification from Slide 12 20 Copyright 2013, Oracle and/or its affiliates. All rights reserved. 20 Where Are We? OFSAA Slide 21 Copyright 2012, Oracle and/or its affiliates. All rights reserved.Insert Information Protection Policy Classification from Slide 12 21 Copyright 2013, Oracle and/or its affiliates. All rights reserved. 21 Solution: OFSAA Deliver One Enterprise source of all AUA data Establishment of the Financial Warehouse Automated Regulatory Reporting Dirty Data Slide 22 John Van Puffelen VP Corporate Finance Slide 23 Disclosure This material is for informational purposes only and should not be regarded as a recommendation or an offer to buy or sell any product or service to which this information may relate. Certain products and services may not be available to all entities or persons. Past performance does not guarantee future results. The views presented represent the views of the speaker and not necessarily the views of the organization. Slide 24 TIAA-CREF Facts & Stats Slide 25 To be a sought after business partner that proactively provides financial and operational information and value added advice that aligns to TIAA-CREFs corporate strategies and drives the firm to achieve its Vision 2020 goals. STRATEGIC GOAL Common Financial Analysis Platform Upgrade/replace existing software applications and manual processes. Create scalable, automated and transparent environment to support profitable growth Integrated Financial Management Information Align business and financial planning with corporate strategies Develop multi-dimensional profitability reporting for products, individual client, institutional client and line of business Create actionable information and reporting for decision making Improved Data Quality, Access & Hierarchy Management Develop single source of profitability information based on standard and consistent methodologies and definitions Create robust cost and revenue information, centralize data management and improve data information delivery Mission Deliver financial management information, tools and processes needed to support business planning, budgeting, forecasting and long range planning; management reporting and decision support; cost transparency; profitable growth strategies; and process efficiencies. Mgmt Reporting & Analytics (MRA) Slide 26 MRA Framework Slide 27 MRA: What if Analysis The Art of the Possible Slide 28 Marginal Multiple dimensions are reported, including LoB, prod, client, channel, program / campaign, geography Stable Principles in place governing definition, characteristics and maintenance of the data Comprehensive detailed profitability and performance quantification improving timely, accurate and detail actionable information to enterprise Transformational Revenue sharing or referral fee arrangements to ensure teaming is fairly rewarded Capital is attributed at the appropriate level based on risk rating Best Practice Risk adjusted measure used to evaluate performance, allocate resources, and calibrate incentives Process Maturity Future State Today Increasing Maturity Defined Processes Real-time Information Value Chain Integration Evolution of Performance Management Slide 29 MRA Information Delivery Slide 30 30 Copyright 2013 Oracle and/or its affiliates. All rights reserved. Confidential Oracle Restricted Graphic Section Divider