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  • ORACLE FLUFF / Oracle Hyperion Financial Management Tips & Techniques / Fugere / 044-5 / Chapter 1Blind Folio 1:1

    CHAPTER1

    Designing YourOracle HFMApplication

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  • A fter hours of sales demonstrations and information about theproducts, you are ready to start implementing Oracle HyperionFinancial Management (HFM). The work may seem a bitoverwhelming at first, but this chapter will help. In this chapter,we will cover the basics of the full suite of products,

    implementation strategy, identifying your internal team and consultationpartner, what a good timeline would look like, andmost criticaldesigningthe HFM application. A good foundation built during the design ensuressuccess. With these tools you should be ready to take on implementing HFM.

    Enterprise Performance ManagementEnterprise Performance Management (EPM) is a set of analytic processes andtools that allow a business to identify, track, measure, and achieve goals.Within the EPM group there are several domains. Each domain focuseson a key business process or function. The Oracle tools focus on the mostcommon EPM domains, which include:

    Planning and Forecasting

    Financial Management

    Strategy Formulation

    Supply Chain Effectiveness

    The tools Oracle offers are a full suite of products that focus on eachprocess individually or in concert, and they provide the capabilities thatmanagement needs to meet its goals. HFM is part of this suite of tools.

    The Oracle EPM Suite OverviewSeveral products make up the Oracle Enterprise Performance Management(EPM) suite. At the core of the suite are three products: Oracle HyperionFinancial Management, Essbase, and Planning. Each product, whiledesigned and built for each of the key EPM domains, also works in concertto integrate the entire process. For example, Financial Management is

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  • exceptional for computing complex currency translations, allocations,eliminations, and consolidations. Planning is built for driver-based planning,and managing multiple scenarios such as forecasting and financial businessmodeling. Essbase is a powerful analytic tool that can handle large volumesof data.

    As you can see in Figure 1-1, each core product fills a role betweenthe web tier and the foundation. This is not to say that there is no overlapbetween these tools. I have seen Essbase applications that includeconsolidation and elimination. I have worked with HFM applications thathave planning, budgeting, and forecasting functionality built into them.However, each product is exceptional for its own focused task.

    The three core products all sit on top of the Oracle Foundation. Figure 1-2shows all of the services included in the Foundation. The core parts I amgoing to discuss are

    Oracle Hyperion Shared Services Shared Services provides acentral location to manage user provisioning, lifecycle management,and task flow management for all EPM System products. Also SharedServices includes the Shared Services Registry, which is a centralrepository that stores and reuses information for most EPM systemproducts installed.

    Enterprise Performance Management Architect (EPMA) EPMA allowscreating, maintaining, and synchronizing the core applications througha graphical user interface. Enterprise Performance ManagementArchitect works with: Calculation Manager, Planning, FinancialManagement, Essbase, Profitability, and Cost Management.

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    FIGURE 1-1. The full EPM suite

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  • Calculation Manager Calculation Manager allows administrators todesign, validate, and administer rules in a graphical environment forthe core products.

    Oracle Hyperion Smart View for Office Smart View provides acommon Microsoft Office add-in for Essbase, Financial Management,Planning, and Reporting and Analysis. It can also perform ad-hocanalysis on data from Oracle Business Intelligence Enterprise Edition(BI EE). One of the most underrated features of Smart View is that it isfor more than just Excel. Smart View works with Word, PowerPoint,Outlook, and Excel.

    You interact with the system primarily through the web. Since there is nolocal application installed, you can roll the products out to more users. Thisis just one more way the toolset is able to scale. The primary page usersinteract with is Oracle Enterprise Performance Management Workspace.The Workspace provides a single place to find and work with the suite ofproducts in a single, multitabbed user interface.

    There are newer tools that focus on very specific tasks. For example,the tool Disclosure Management provides an integrated tool for eXtensibleBusiness Reporting Language (XBRL) reporting. Financial Close Managerprovides a tool to manage, communicate, and track the entire close process.Financial Close Manager will soon help drive account reconciliation.

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    FIGURE 1-2. The Foundation Services

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  • The final component to the EPM suite is the financial reporting. Thereare several tools for reporting, and each one helps serve a purpose.Financial reports work very well for external reporting. Web Analysis,Oracle Business Intelligence Publisher, and Oracle BI EE work best fordashboard reporting.

    Define the ScopeOnce you have decided what products you will implement, you need todefine the scope of the build. The scope is important to determine what youbuild and when. There are a couple of steps to defining the scope. The firststep is to define the critical success factors, or the main purpose of yourproject. Since each product does something specifically, you should focuson that goal for the project. For example, if you are preparing for an HFMproject, you should be focusing on financial consolidations and externalfinancial reporting. You may find you have the bandwidth for adding somebudget collection, or management reporting, but your primary focus shouldbe consolidations. This seems obvious, but many people find themselvestrying to sell a project internally or trying to make sure they are maximizingthe return on this investment. In HFM, people have all kinds of things youwould not think of including in a consolidation system. And a lot of themwere good ideas. For example, some things that seem like good ideas areunit information, or inventory details. It might be a good thing to addsomething like this, but you increase your chances for success by tacklingthat additional piece in a second phase. Successful attempts at beingcreative to expand value, more often than not, happen after the mainconsolidation project is completed.

    The second step to defining scope is to focus on the core products. Ifyou have purchased more than one product of the EPM suite, you will needto prioritize your implementation. To focus on what products you will beimplementing and when, look at your financial calendar and consider whatparts to implement during the year. If the budget is due in six weeks, youmay be aggressive, thinking you can get Planning in place first. It is asizable undertaking trying to implement the full EPM suite all at once. Eachproduct not only has its own design considerations, but often impactsdifferent parts of a company very differently. Consider stepping back,consider what products you will be using both tactically and strategically,and plan how you will put these tools into place.

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  • Finally, you need to define your time line. The time you have toimplement should help you prioritize what you can accomplish during theimplementation. So, if your time line allows, and you have the appetite forhaving a large project, you could implement the full suite all at once. I wouldnot recommend it. Many people will think that because you expect someeconomies of having several projects of the same products set, same users,you can save on things like project management. But the risk of having somany tasks, teams, and changes all moving at once outweighs the benefits.

    EPM and EPIOne common mistake people make is failing to understand what it means todesign an HFM application. It does not mean to re-evaluate the entire businessprocess. Reviewing and redefining the business processes around HFM isexpensive and time-consuming, and not required in order to have a good buildand a successful project.

    HFM is an EPM tool. That tool has functionality that drives how certainprocesses will function. Using them for other purposes or not as intendedcreates issues. Using any tool for a purpose it was not intended always leadsto some shortcoming. Unless the tool is meeting some very short-term need,why set yourself up for frustration?

    EPI, or Enterprise Process Improvement, is not about a tool. It is not eventechnology-centric. This is an open evaluation of what you do, why, andhow you can do it better. This can be a process that takes years, built instages as the company grows.

    While it is important to understand the current business process, andconsider what that future state might look like, the future process does notimpact as many of the design considerations as you might think. A gooddesign will allow for future requirements. For example, if I asked a hundredcorporate controllers to explain the impact of International FinancialReporting Standards (IFRS) on their business in 2003, I doubt I would havegotten one certain answer. Still, applications that were designed well evenbefore that time will be able to accommodate IFRS.

    Consider the effort of evaluating and reviewing every process thatimpacts the close. If you were going to do that, you could also re-evaluatethe reports used and the metrics used to measure the business, and considerreorganizing the business. If you use that logic, the scope can easily expand

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  • beyond what is really needed to complete a successful project. The buildingof an HFM application is best handled as a discrete step of a businessprocess evaluation and change effort. Remember, this tool is built to dofinancial consolidations. And while many business process changes maybe things worth doing, they are not required in order to create an HFMapplication. That is true even for an application that will be used to do allof those transformative goals you may have. A good requirements anddesign meeting should only discuss those items, so the design team canconfirm that the design considers the impact of those changes.

    Identify Your TeamOnce you have decided on a product implementation strategy, and consideredthe scope, you need to assemble a team to help implement HFM. There aresome key roles you need to fill if you want to be successful. I would group themas internal and external.

    The Internal TeamThere are four internal roles: Subject Matter Experts (SMEs), an ApplicationAdministrator, Infrastructure Support, and a Project Manager. Having thesethree roles defined internally doesnt guarantee success, but in everyimplementation that had issues, these roles were not defined. It is alsoimportant to define these roles because they will be required to support theapplication after you go live.

    First, a good team will consist of people who understand the businessprocess and are very familiar with the politics and procedures of thebusiness. You will need people who understand the accounting required,including tax, treasury, management reporting, and especially consolidationaccounting. These people are Subject Matter Experts. These SMEs shouldhave some minimum time commitment to the project. These people areimportant to the project because they will help with data reconciliation,training, and support of the application after go-live. When trying to staff theproject, this is one role that people often look to staff by hiring temporaryresources. I can tell you, no temporary person you hire will know yourbusiness and accounting better than the people in your organization. Soyour project will suffer if you try to hire temporary resources for this role.

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  • And in the unlikely chance you are successful, when the project is over, thepeople who learned this new system will leave and take this knowledgewith them. So, you should look within your organization for these people.

    Second, you need to identify an application administrator. This selectionis extremely critical to the success of the project. Many projects haveovercome seemingly insurmountable obstacles because of strong, brightadministrators, and just as many have struggled to get footing within acompany because of distracted or overworked administrators. The bestpeople to select as administrators are people with a finance background.Although HFM uses Visual Basic in spots and has scripting, HFM is not atool used by the infrastructure groups. It is a finance tool. It is much easier toteach a finance person the technical components of HFM than it is to teachan IT programmer the workings of debits and credits. A person withmoderate skills in writing a macro in Excel will have all the scripting skillsrequired to administer HFM. This person will own the bulk of themaintenance after the project goes live. They will be critical in maintainingand supporting the application after you have gone live. This role could bebroken out by product or by database. The administrators are usually alsoresponsible for data integration as well. It would be wise to plan for havinga backup. I would expect this person to spend between one and two weeksper month supporting the application after the implementation is complete.

    The administrator should work closely with the IT support team. Whilethe role is not as dedicated as the other roles, the tasks and timing of theinfrastructure tasks are very important. The Oracle EPM toolset is complexand has a steep learning curve.

    Finally, every successful project has a strong project manager. It is therole of the project manager to communicate risks, track tasks to the budget,and control scope. For some reason, people seem to discount the value thisrole has in a project. A strong experienced person in this role bringsexperience about this toolset to the process. Implementing HFM, or for thatmatter any of the Hyperion tools, is not like working with any other ITproject. It is not an enterprise resource planning (ERP) tool, or a custom tool.The Hyperion tools often cross over departments and roles and are wide-reaching. The process for implementing HFM needs to reflect that. Youshould not make the mistake of underestimating the value of goodcommunication, thoughtful planning, and strong project management. Tobe successful, the thing to do first is have a plan, and then make sure you

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  • are communicating effectively and identifying the impact of the process.These are all things that good project leadership and project managementbring to your project.

    Your Implementation PartnerThe next step is to identify an implementation partner. This part of yourteam will be easier to find. There are companies who will buy HFM that arelucky enough to have found a person who has consulting experience, or ata minimum has been on several projects and can bring that experience tothe team. If your company is not one of those companies, I would suggesthaving an implementation partner that will give you the best chance ofcompleting the project on time and as close to your intended budget aspossible. Besides experience, a strong consulting partner has a network ofresources, either internally or across the HFM community, that they canreference to get answers to problems when they come up. I would suggestyou look for some key factors when selecting your partner. First, are theycertified in HFM? There are several Oracle certifications for differentproducts; it does not help to know Essbase for an HFM project. Second,how many projects has the lead resource worked on? Finally, call theirreferences. You will get some great feedback, hear about pitfalls you wonthear about in a sales cycle, and start to build your own support network forafter the project go-live.

    Most companies that use HFM are publicly traded, and as such aresubject to stringent regulations and reporting deadlines. Look for a partnerthat can provide a system architecture design that can withstand a singlefailure of any of the individual components (redundant services), or failureof an entire service center (disaster recovery planning).

    Do not overlook the value Oracle brings to every project. You need tolearn to navigate Oracle support and become familiar with how to get issueslogged, tracked, and supported. Not only will this be your lifeline after theproject goes live, but it is part of the maintenance you pay for with theproduct, and you should take advantage of it.

    Support from the Infrastructure GroupHow much infrastructure support people need to plan for is a very commonconcern. Especially if you are migrating to HFM from a consolidation andreporting tool like Hyperion Enterprise or Excel, where IT support was

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  • minimal or none, you will not be sure what type and commitment ofresources you need to plan for. During the project, the times when it iscritical to have IT support are: installation, security, testing, training support,and go-live. Now each project is different, but each of those phasestypically does not require more than a week or two. If you decide to take onmore complex security like Secure Sockets Layer (SSL) at every layer, anduse a tool like Hewlett-Packard Load Runner to simulate load on the servers,the times can go much higher. Once you are live, the time needed tosupport HFM drops off significantly for most all clients. If you are live withHFM and the application is average in size and you have a full-time ITresource supporting your HFM application, then something is very wrong.Most people plan for support to add users, support the change controlprocess, and help with connectivity issues. Many routine tasks can andshould be automated. A strong implementation partner will help you setthose up.

    Create a Project PlanOnce you decide which products you will be implementing, and have pulledtogether your team, you need to make a plan. Most full implementations ofHFM take between five and eight months. During the first month, youestablish your requirements and design. The installation, administratortraining, and a change control process meeting should also happen duringthe first month. The second and third month will be focused on buildactivities. If you are not certain about your design, you can plan for aconference room demonstration or proof of concept. During this time theteam will develop rules, create structures (often called metadata), and buildreports.

    Data should be loaded into HFM as soon as possible. It is important toload data early for two reasons. First, a representative set of data will helpthe development team determine performance and identify issues during thebuild. Second, it will help with determining performance issues early in theproject.

    Once the build has begun, this phase of a project is heavy with datareconciliation. Data reconciliation is very time-consuming, and is the onepart of any implantation that cannot be underestimated. The reason this taskis so difficult to manage is that, for many users, it is the first time they areworking with the software, looking for data, and getting their head around

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  • how HFM will calculate the elimination, allocations, and other numbers.This may be the first time the team or users will see data using the 12dimensions. That learning curve for working with multiple dimensions cantake people time to overcome. The second reason data reconciliation cantake longer than you would expect is that it is frankly not glamorous work. Itcan be very tedious. Some people find themselves easily distracted doingdata reconciliation. That slows down the work quite a bit.

    Once data has been loaded and is being reconciled, then technical testingcan start. It is true that data reconciliation is by its nature a test. But you willneed to do some other testing to make sure your system is performing well.You need to load data to ensure that you have valid tests. The data does nothave to be final or complete, but it should be representative of what the actualdata will be once its complete. You should plan to test when it will notimpact data reconciliation, or when data reconciliation will not skew testingresults. The length of time required for testing can vary. There are severaltypes of testing:

    Unit testing This type of testing is usually not documented, but isrequired to ensure that each build step is being completed.

    Integration (functional) testing This test is a set of common tasksto ensure that each component when brought together works in oneapplication.

    Performance testing This testing is at a minimum a baseline ofbasic tasks on the production server. At best, this test is a fullcomplement of tests simulating activity from remote sites using atool like Load Runner.

    User Acceptance Testing (UAT) This test is either performed by asubset of power users or as a review of training.

    Connectivity testing This test is the final test, ensuring that userscan access the system by opening the application site in a browser,and security is in place.

    After the application has completed testing, the rollout begins. Therollout is the process for getting users to adopt the system. And to have theusers ready to take this ownership, you need to train them. This training will

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  • happen before UAT or connectivity testing. Training is often completed foradministrators early in the project, close to the design meeting. So the bestpractice is for end users to be trained as close to the UAT as possible. It isbest to have users touch the software as close to the training as possible toreinforce what was learned. This makes the UAT much more efficient. Usershave an expectation based on training performance, and can use that tomake sure the system is working as expected.

    There are many kinds of training, enough that one might fill an entirebook on that subject alone. The first consideration you need to make is thegroups of people who need training. There is the small group of your coreteam, and these people need to go to administrator training. This needs tohappen either before or after the design. If your project has these peopleintimately involved, they will be trained during the whole implementation.If not, you will need a deep and thorough training for administrators and adeveloped plan to transfer ownership.

    The second type of training is for your end users. There are couple ofoptions here. The most common are

    Classroom Have your users come in for a set class. The biggestbenefit is that you control the environment. This works greatpeople are not distracted or getting pulled from training. This optionalso can cost the most, especially if people are really spread outgeographically.

    The Road Show Visit each site with a set training program.Creating multiple teams to visit each group helps defray the costs.

    Train the Trainer Have a set of super-users train your team. Thebenefit here is that training knowledge stays in house and thetrainers can transition into a support role for your team after theproject is live.

    The next step is a simulation of the close using HFM. It is called aparallel. I would never recommend fewer than two parallels. Users willneed that much time to ensure that they can confidently repeat the close ina reliable way. I would also never recommend more than four parallels.Having too many of these simulations creates quite a bit of fatigue within

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  • the user community. Remember, they have to close the books in two ormore systems when these final steps are being completed. It can create quitea bit more work than people realize. You want to have at least one of theseparallels happen when you are doing a quarter close and preferably a year-end close, if your process changes at all during these times. Since mostpeople do have processes that are done only during quarter close time, theywill include one quarter. You should too. You should also choose a monthwhere the work load is not as high to stop using the old system, and just usethis new tool going forward. This is called go-live.

    Although the build is less than a third of the entire build time, looking atFigure 1-3, it is easy to see that the build is the busiest time. You have moregoing on at that time than during the other project phases.

    Dimension OverviewThe purpose of this chapter is to discuss topics you would cover during yourdesign meeting. This section should be used to complement theAdministrator Guide, not replace it.

    You must understand what a dimension is and how they work in order tomove forward with a design. Dimensions are the objects we use in HFM todefine coordinates within the database. These dimensions define where data

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    FIGURE 1-3. A sample HFM project timeline

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  • is stored within the application. Assume that I just had a simple spreadsheet,with columns and rows. When I ask what the value in cell B-9 is, you coulddetermine that B referred to the column and 9 must refer to row. From thatyou could determine the value in cell B-9. B-9 are the dimensions that tellyou where to find the data.

    HFM uses dimensions, except there are 12 dimensions for every HFMapplication. This is more difficult to conceptualize than the 2 dimensions ina spreadsheet. Every application uses 12 dimensions. If you did not use oneof the dimensions in your application, you would have to use a defaultmember called [None]. You would need to reference all 12 dimensions tofind data in the database, which includes writing a report, entering data, orwriting a rule.

    To envision the impact of more dimensions, lets take it up a notch; nowpicture tabs for the spreadsheet. Now picture multiple spreadsheets allgrouped in a folder on your computer. To find a number you need to lookat one workbook, tab 3, column C, and row 13. Finding your data in HFMisnt much different than that.

    It is important to remember that you must consider all 12 dimensionswhen designing your application. Many people initially think they will bemaking the application much easier to use when setting the dimensions upby not using one dimension and trying to make two different dimensions fitinto one. It is best to think about what are the slices of data you need todefine for your reports, then align them with dimensions and logically layout how they should align within HFM. If you need to use all 12, then by allmeans, do not feel restricted.

    And scope is still important here. It is important to not try to build forevery eventuality. You cant plan for every possible change in reporting, sojust focus on the reporting and goals you defined at the beginning of theproject.

    The 12 dimensions used in HFM are

    View The View dimension provides calendar intelligence; forexample, Month-to-Date, Year-to-Date, and Quarter-to-Datefrequencies. This dimension was formerly referred to as Frequency.

    Year The number of years you will use for HFM. The Yeardimension provides multiple years of a fiscal or calendar year.

    Period The Period dimension provides time periods, such asquarters and months. For example, if you need months, there wouldbe 12 periods of data available for a given scenario in a year.

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  • Scenario The Scenario dimension represents a set of data, such asBudget, Actual, or Forecast. For example, the Actual scenario cancontain data from a general ledger, reflecting past and currentbusiness operations.

    Entity The Entity dimension provides a means to build structuresfor the consolidation. These can be divisions, subsidiaries, plants,regions, countries, legal entities, business units, departments, or anyorganizational unit.

    Value The Value dimension allows for consolidation, elimination,and adjustments and supports translation, which can include theinput currency and parent currency.

    Account The Account dimension allows you to build a hierarchyof assets, liabilities, revenue, expense, and so on. Each type ofaccount has a specific behavior.

    Intercompany Partner (ICP) The Intercompany dimension representsall intercompany balances that exist for an account. This dimension isbuilt dynamically from the Entity dimension.

    Custom1, Custom2, Custom3, Custom4 The Custom dimensionsprovide the ability to store other views of the data, such as products,markets, channels, cash flow changes, balance sheet movement,source of data, or types of elimination.

    You will also have to define application settings and aliases to build anapplication; however, they are not dimensions. All of these dimensions areoften referred to as the metadata. Metadata is a term used to describe datavalues that define other data. Technically speaking, the dimensions are alldata elements that define data within the HFM application. People often usethese terms interchangeably when discussing HFM structures.

    Now that you know the dimensions, lets understand how they are builtwithin the application. All of the dimensions are built such that each has itsown hierarchy. The hierarchy is a tree structure where each member hasa relationship with other members. The lowest level of this tree structureis called leaves, like the leaves on a tree. They are also called basemembers, if you want to think of them as the bottom bricks of a pyramid.

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  • The tree in Figure 1-4 shows an example of an account hierarchy. Themembers have relative relationships. Some of the obvious ones areparent and child. As in the example shown in Figure 1-4, the child (NetIncome) is below the parent (Net Profit.) The child is below a parent. Aparent member can have several children. Two children with the sameparent are called siblings. Another relationship used is descendants; thoseare all members below some parent, including children of children. Theserelationships are one way the tool creates dynamic lists and allows fordrilling from one member to another.

    Data is entered into base-level members of the dimensions, not intoparent members, with very few exceptions. For example, data isnt actuallystored for parent account members in HFM. The values for parent accountsare aggregated from their children when the data is brought into memory.

    Naming ConventionSo you are ready to start adding members to your application metadata.You should give some thought as to what to call them, as it could reallysave you some time and headaches later. When choosing a namingconvention for metadata, I actually have a strong preference about thistopic that I bring to every design session. Identify the most common orlargest source of data for your chart of accounts, and use that for all base

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    FIGURE 1-4. A dimension hierarchy

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  • members. This does several things. It simplifies the mapping becauseyou can use the = which, simply put, means everything in thatdimension maps to everything with the same name. That is only oneline of mapping, meaning there is less work that Financial Data QualityManagement (FDM) or Oracle Data Integrator (ODI) needs to do to mapdata values. Even if it isnt your only line of mapping, your mappingwork will be much less. Second, this makes it much easier on you andyour end users to reconcile. It is much simpler to see an account A7000,and know that it is the same account and means the same thing in HFMas it does in the ledger. Third, a commonly used structure like what isused in the main ledger is typically the largest source of data and issomething your users are already familiar with. This familiarity willspeed the adoption of HFM within the company. The structures anddimensionality will be something familiar to the end users.

    I would also recommend strongly following the Administrator Guidessupported characters. Even when an unsupported character seems to worknow, it does not mean that it will still work after an upgrade or patch.Special characters like ampersand (&) can cause problems that are tough toidentify early on in a project build. That is why they are unsupported.

    Finally, while this will be tough to do if you have never implementedHFM before, you should think about what names will help you whilewriting rules. People often use prefixes like CF for cash flow accounts tohelp them identify which accounts would be used for the cash flow in a listof all accounts. And while I am on this topic, never use a space in any label.It will make troubleshooting a misspelled label in a rule almost impossible.You cant see the difference in a text file between Net_Income and Net_Income. (The second one has a space right at the end, and you wouldnever see that in a file.)

    You should be consistent when labeling. This will help people follow thesystem and will speed adoption. Be careful about making the labels toolong, though. Remember, you will have to write out some of these names,and the longer they are, the more difficult that will be.

    Underscores are supported, and should be used if they help readability. Ihave found that proper case will do that more often than not, but it is nice tohave the option.

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  • Application ProfileWhen you are ready to create your application and build hierarchies, youneed to create a shell for the members to load into. If you are building thesemembers in a Classic application, you will be using the desktop application.If you plan to build these using EPMA, then you should identify onlycommon members to use from the master library, and build other partsseparately.

    When first defining your application, you need to define someparameters that cannot be changed unless you rebuild the application. Youshould not plan to rebuild the application for some time, so you shouldconsider something that you can live with. That does not mean you need toplan to live with this forever. There are times when a rebuild makes sense.This book will cover those cases in the support section, but just know theseare not parameters you will be updating and changing without some effort.They are Aliases (Formerly Languages), Calendars, View, and Period.

    Aliases (Formerly Languages)Lets discuss aliases first. An alias is a set of descriptions, typically bylanguage. These can also be as subtle as the difference between tax andcorporate reporting. You can specify up to ten aliases for all of thedescriptions within HFM. One of your aliases needs to be English. You canthave an HFM application without English. This should not be confused withlocalization. Localization refers to the language used in the menus andtoolbars within the application. The Languages refer directly to thedescriptions you would modify for all of your metadata and dimensions.Figure 1-5 shows how you might set that up.

    Languages dont have to be an actual language, though. I have workedwith applications that have used tax labels for state insurance filing as alanguage in HFM. They could then report from the same chart of accountsboth Securities and Exchange Commission (SEC) and state statutory reportswith descriptions.

    These languages should not be confused with localization. This is theability to have the menus in Workspace, HFM, and Smart View appear indifferent languages. These are determined by demand at Oracle. Thelocalization team fills in strings for each menu item with the appropriate

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  • translated term for each of the required languages (Spanish, French, Italian,German, Russian, and so on). These strings are made part of the code so thateven the release after a localized release, which should only be US English,still has those strings in the code. The strings are surfaced automatically inthe browserthere is a code detection that reads the browsers defaultlanguage and displays the strings if they are available; otherwise, theydisplay US English. During localization, the product documentation andhelp guides are also translated.

    Experiment with this yourself by adding German, Spanish, or French intoyour Internet Explorer browser. Go to Internet Options; General; Languages(at the bottom) and add a language (lets say French). Move the newlanguage to the first position and it will become the default. Restart yourbrowser, and then connect to Workspace; you will see the menus in thechosen language if it is one that Hyperion has localized into. For example,French would appear in menus that normally are in English.

    CalendarsNext you must define the fiscal calendar. You are given three choices forthese to get started: Standard, Custom, and Manually Defined. You canmodify any of these when you see them, so I have always found that usingthe Standard calendar gives a great starting point. You can then modify the

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    FIGURE 1-5. Adding languages

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  • names and descriptions of the months here. After you select the type ofcalendar and update the time periods for the application profile, defaultfrequencies are created for the application profile. You should not haveweekly periods, and definitely not daily periods.

    For example, if you select Standard calendar and include quarters andmonths as time periods, you will see yearly, quarterly, and monthlyfrequencies. Figure 1-6 is an example of a commonly used calendar. Dontget confused by seeing the Year as the top member. This represents thesum of all 12 months, not the Year dimension.

    ViewThe View is the first to define as part of the application profile. The Viewdimension provides calendar intelligence. That means HFM will providevalues for the view selected. The most common are Periodic, Year-to-Date,and Quarter-to-Date frequencies. If you set the view to Periodic, the valuesfor each month change are displayed. If you set the view to Year-to-Date,the cumulative values for the year are displayed.

    You will have to choose both a label and description for the Viewmembers you create. As with many of the dimensions, I would recommendsomething that could be used in your reports for each. For example, Ialways use the common abbreviation (MTD, QTD, and YTD) for the label,and the longer description (Year-to-Date, Periodic) for the descriptions. Bothare helpful and could be shown in reports.

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    FIGURE 1-6. A sample calendar

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  • For each frequency, you can enter a label and description for eachlanguage that you previously defined. When editing frequencies, youcannot change the label of the YTD frequency, but you can update thedescription. It is possible to use more relevant descriptions if they makesense for your business, like Spring and Fall for a retail company. Youshould consider what you need in your reports to decide this. There are twosystem-defined frequencies and corresponding views, Scenario View andPeriodic. If you had chosen a Manually Defined Calendar as the time periodfor the calendar, the Frequencies grid would be empty, and you mustupdate the frequencies. You should enter one frequency for each level ofthe Period dimension, as shown in the example in Figure 1-7.

    YearThe Year dimension seems to spark the most discussion. It is pretty simple;you need only a start year and life of the application. So, it should be a shortconversation. Still people struggle with the reality that these arent changing.At just about every project, this is the point of the discussion when everyoneturns to the most junior person and tries to figure out when they will beleaving the company or retiring, and then they want to add one day to that.Figure 1-8 shows an example of how you might set this up.

    While there really isnt a performance impact to having more years,there are a couple of things to consider. First, people are going to have toscroll through whatever you decide. Does it really make sense to have many

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    FIGURE 1-7. Frequencies example

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  • years that people will not look at just sitting there to scroll through? Second,open places where data can exist have a remarkable way of finding data tofill them. People fill them by mistake, a rule populates them unintentionally,or test data never gets cleared. That takes up space on the servers andincreases costs.

    A couple of things to consider here; you cant change the descriptionson yearsthese years are fiscal, not calendar, years, and you cant addyears to the application.

    My rule of thumb for number of years is to take the current year and askhow much history, and then add 10. So for an application with 5 years ofhistory starting in 2010, the start year would be 2005, and have a life of16 years. If you dont think that is enough time, consider this: 10 years agoIntel was still selling the Pentium processor, Windows XP was a year frombeing released, and Google had yet to top $80 million in revenue (Googleearned over $23 billion in 2009). A lot can change in 10 years.

    PeriodThe Period dimension is the last dimension that needs to be fixed. It is alsovery straightforward. You define months and they roll into quarters or halfyears, and then those roll into years.

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    FIGURE 1-8. Example of years

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  • The labeling convention should be like everything elsethink of yourreports and how you can use both the label and description. I recommendsomething like in Figure 1-8. You would have a three-letter abbreviationand then the full description.

    Finally, you would update the period hierarchy. You will use the timeperiods and frequencies that you defined. You can make changes to thishierarchy by adding or deleting periods. It really is not a good idea to havea calendar with weekly periods. The performance will be disappointing.I also recommend thinking through whether having a period 13 is reallyrequired. Just because it is in your ledger does not mean you need it inHFM. HFM does not need a period 13 to close balances or even to includeaudit adjustments, so you should question it. Figure 1-9 is an example ofhow the Period dimension could be set up.

    CurrenciesEach entity will be assigned a single default currency. By default, HFM caneasily translate any entity into any currency in the application. This can alsobe done by way of triangulation, which is also supported by HFM. Theapplication will triangulate through the default currency you specified in theApplication Settings. The application wont translate into every currencyautomatically. HFM will only automatically translate when it thinks it needsto, and that means when the currency of an entity is different than thecurrency of its parent. Other translations will require the users to force thetranslation.

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    FIGURE 1-9. Period hierarchy

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  • While currencies are not a real dimension, when you define currencies,HFM will create members in the Value dimension, Custom1 and Custom2,described later in this chapter. You must provide a label and description foreach currency you wish to use. This is another design consideration youshould give some careful thought to. You do not want to have to add manycurrencies later, as doing so has a significant impact on the database. Youalso do not want to have too many unused currencies, because that can alsohave a performance impact. I would suggest having all the currencies youdo business in now, and those you are certain you will use in the next threeyears. The labels and descriptions for the currencies should have somelogical convention. So consider what your reports require. To that end, itmakes sense to use ISO labels and descriptions. As shown in Figure 1-10,use AUD and Australian Dollars, and not something like AUS andAustralian $.

    There is no need for currencies with the same type (EUR and EUR1 orEUR_old). Since these are really separate dimensions, you can enter severalEUR to USD rates, even with the same period, all for different entities.

    Application SettingsOnce the application has been created, you are ready to start building it.The first step is to define some common application settings. Unlike theprofile, these can be changed. It is important, though, to know the impact

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    FIGURE 1-10. Sample currencies

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  • of each setting. You will need to come back to these settings once youhave defined the accounts. The following list shows some key applicationsettings.

    ConsolidationRules This identifies whether consolidation rules willbe customized. Specify one of these values: Y, R, or N. Specify Y touse the custom rules written in the Consolidate() subroutine. R willderive the proportional and elimination value in the Valuedimension.N will use the default consolidation and eliminations. Wheneverpossible, use R to optimize consolidation performance if yourapplication can use the default HFM consolidation rules.

    DefaultCurrency Identifies the default currency for the application.Most applications will use the reported currency of the parentcompany.

    DefaultRateForBalanceAccounts The currency rate account thatcontains the translation rate to use for Asset or Liability accounts.This is the end-of-period or end-of-month rate.

    DefaultRateForFlowAccounts The currency rate account thatcontains the translation rate to use for Revenue or Expense accounts.This is the period average rate account.

    DefaultValueForActive Identifies the default value for the Activeaccount. This attribute is required even though it is for OrgByPeriodapplications only. Specify 0 if the child entity is considered inactiveby default and will not consolidate into the parent entity. Specify 1 ifthe child entity is considered active by default and consolidates intothe parent. Since most of your new entities will be consolidated,you should choose 1 unless you are building an OrgByPeriodapplication. In that case you should choose 0. When you choose 0for Organization by Period applications, no historical periods areimpacted when a new entity is added or an existing entity is addedto a new parent. Organization by Period has many otherconsiderations covered later in this book.

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  • EnableMetadataSecurityFiltering Metadata filtering is a feature thatallows users to see only the members to which they have access,and not necessarily see the entire structure of the database. You canfilter on Scenario, Entity, Intercompany Partner (ICP), Account,Custom1, Custom2, Custom3, or Custom4. The default for thisattribute is N, but choose Y when you want to limit peoples access.

    FDMAppName Name of the Oracle Hyperion Financial DataQuality Management application. This facilitates drillback fromHFM into FDM.

    ICPEntitiesAggregationWeight Identifies the percentage ofintercompany partner entity [ICP Entities] amounts that aggregate tothe [ICP Top] within the Value dimension. It is almost always 1.

    MaxCellTextSize Identifies the maximum number of charactersthat can be used for cell text. You can enter a positive number up to2,147,483,646, or 1 for no limit. The default of 8000 will be morethan enough for most people.

    MaxDocAttachmentSize Identifies the maximum number of bytesfor any document attachments. You can enter a positive number upto 2,147,483,646, or 1 for no limit. You should consider limitingthis as some people will load excessively large files.

    MaxNumDocAttachments Identifies the maximum number ofdocument attachments per user. You can enter a positive number upto 2,147,483,646, or 1 for no limit, which is the default as well.

    NodeSecurity Enter Entity to check node data based on securityaccess for the entity and Parent to check node data based onsecurity access for the parent. Most applications have Entity. Thissetting will control who can access the Node of the Entity. These arethe value members with square brackets. You might use Parentwhen another person will be pushing journals or data down toentities earlier in the close process.

    OrgByPeriodApplication Specify Y to use Org by Period or N touse only one organizational structure. If you are planning onbuilding complex ownership structures in the entity dimension, youshould plan on using Org by Period.

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  • SupportSubmissionPhaseforAccounts If you are planning to submitpart of the chart of accounts at different times for process management,you will need to set this to allow for phased submissions. Your optionsare Y or N, and the default is N.

    SupportSubmissionPhaseforCustom1-4 If you are planning tosubmit some of the custom members at different times for processmanagement, you will need to set this to allow for phasedsubmissions. Your options are Y or N, and the default is N.

    SupportSubmissionPhaseforICP If you are planning to submitdifferent ICP members at different times for process management,you will need to set this to allow for phased submissions. Youroptions are Y or N, and the default is N.

    UsePVAForBalanceAccounts PVA is a method of translationwhere the periodic value is translated for each month, and themonths are summed to give a year-to-date balance. If you select Y,this translation method would be used on Balance accounts.Balance accounts typically use the VAL method, which istranslation at a point in time.

    UsePVAForFlowAccounts PVA is a method of translation wherethe periodic value is translated for each month, and the months aresummed to give a year-to-date balance. If you select Y, this translationmethod would be used on Flow accounts.

    ValidationAccount This is required for process management.The validation account must equal zero before a process unit canbe promoted or rejected. The validation account also serves as alocking account, meaning that it must equal zero before you canlock an entity. You can specify a validation account for SubmissionPhase 1 to 9.

    Figure 1-11 shows how we would set these application settings up. Nowthat you have a profile and defined application settings, you are ready tobuild the rest of your metadata.

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    FIGURE 1-11. Application settings example

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  • ScenarioThe Scenario dimension is used to identify the type of data that will bestored for all periods, entities, and accounts. It is a version of a projectedcourse. The most common is Actual. That would be all actual datareported. Other types of data include Budget and Forecast. You couldhave Versions of each. For example you may have Budget1, Budget2,Budget3, and a final budget submission just called Budget. Each of theseexamples tells a different story of the data in HFM.

    You can determine how many you need by asking yourself how many ofthese versions you review and report on each month. These reports are oftencalled variance reports, and they show the differences between thesemultiple Scenarios.

    Like all the other dimensions, the Scenario dimension has a hierarchy, butit is flat. One could have a structure, but it will only serve to help people seethe relationship between other Scenarios. You may want to have the FinalBudget be a parent, and the versions of working budgets are children.

    There are some important settings specific to the Scenario dimension thatshould be considered.

    ConsolidateYTD Enter Y for YTD or N for periodic. The decisionpoint here is how should HFM run its consolidation; Org by Periodapplications will always be periodic.

    DefaultFreq This identifies the periods defined in the ApplicationProfile for which data input is valid. For example, Monthly indicatesthat you can extract input data only in month-based periods.

    DefaultView YTD or Periodic. Typically, Budget and Forecastwould be periodic and Actual is YTD. This default view impactsrules as its default view.

    DefFreqForICTrans Required for Intercompany Transaction Module,this setting identifies the default frequency for intercompanytransactions.

    EnableDataAudit Y to automatically audit all accounts (evenaccounts that have EnableDataAudit set to False), or O to audit onlyaccounts with EnableDataAudit set to True. You would choose N todisable auditing for this scenario.

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  • MaximumReviewLevel This attribute is required, but is not used byHFM in any way. You could put any number and it does not impactany functionality. Still, you still need a value from 1 to 10.

    PhasedSubmissionStartYear Identifies the start year for phasedsubmissions in process management. This is a new feature ofRelease 11.1.2.

    SupportsProcessManagement Y to enable Process Management, Nto disable Process Management, or A to enable Process Managementand E-mail alerting.

    UsesLineItems Y if the scenario can accept line item detail. This isuseful for accounts that require line item detail in Actual, but not inBudget.

    Figure 1-12 shows the three most commonly used scenarios and theirsettings: Actual, Forecast, and Budget.

    The next two settings are key settings that need to be considered forsetting up scenarios. ZeroViewForAdj and ZeroViewForNonadj are bothrequired attributes that inform applications how to handle missing data.They may be set to either Periodic or YTD, and HFM derives either Periodicor YTD values for missing data accordingly.

    Why do you even need these settings? These settings are there simplybecause you do not want to load zeros into the database. A zero is actuallysomething in the database. A zero takes up space and requires the system to

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    FIGURE 1-12. Most common scenarios

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  • handle it, either reading or writing it to the database. Not having zeros inthe application will really increase performance.

    There is a rare exception when you need to load zeros, and that is whenthe zero view settings you defined for the scenarios are not valid for allentities; for example, when you have to load periodic data, but the defaultview is year to date. This would create cases when the periodic change iszero, you need to load that zero so that the year-to-date number is correct.But you really should exhaust your options trying to get the data file in aformat that is consistent.

    The first difference to note in these settings is that one is for handlingAdjustments (journals) and the other is for all other data points.

    You should consider how you plan to look at the data; one way isselecting Period view. This is most common for Budget and Forecastscenarios. Lets assume I have selected a Budget scenario that I am viewingperiodic. If ZeroViewForAdj or ZeroViewForNonAdj is set to Periodic, HFMdisplays a derived value of zero for missing data, and it is treated as azero for the current period change. I would see a zero in the database. If Ichanged my view to Year to Date, HFM displays a derived value that equalsthe sum of previous periods values. The year-to-date number would suggestthere was no change for the month. Looking at Figure 1-13, you can seehow HFM populates these numbers.

    If you were looking at actual data, you would likely prefer a Yearto Date view of the data. If ZeroViewForAdj or ZeroViewForNonAdj isset to YTD, and I was viewing the data Year to Date, HFM displays aderived zero for the year to date. That would mean the month changewould have to equal the negative of the sum of the prior months, asshown in Figure 1-14.

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    FIGURE 11-13. Period change of zero

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  • Variance ReportingFor reports that compare two scenarios, for example Actual to Budget data,you have two options for building this. You can either build two scenarios,or build the second view in the custom dimension. Since you only have fourcustoms in the current version, if you are out of dimensions the decisionmay be made for you. But the advantage of building this type of reportinginto a custom over a scenario is that it is easier to manage copying data andjournals.

    There are some great features in the reports that open many more doors.There are some great ideas for these reports in Chapter 4.

    Constant CurrencySimilar to the issue with variance reporting, you can make managing theapplication easier by having Constant Currency Scenarios in a customdimension over having a separate scenario. It can help to use scenarios tolook at Actual data at Budget rates, Last Year rates, and other rates toevaluate the currency impact on your financial statements. That wouldrequire adding a scenario and copying data and rates from other scenarios.The other option to creating scenarios is using one of the customdimensions. The driver for making this decision is simply performance andavailability of dimensions. If you have used all your custom dimensions,then it is not an option to use them. If they are available, then you couldconsider that. So if dimensions are available, you only need to considerperformance. The performance impact is that you would potentially doublethe data within your subcube. This can slow down the consolidation. Butthere is a big advantage to putting this into a custom dimension: You neverhave to worry about data in one scenario changing and not flowing into theother translation rates you want to see. Older versions of HFM do not havethe newer memory-handling features that minimize this issue.

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    FIGURE 1-14. Year-to-date change of zero

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  • I would suggest using scenarios, as you have more control over whendata is populated into the scenario for evaluation; the special scenario canbe consolidated as a separate process.

    EntityThe Entity dimension should be used to represent the organizationalstructure of the business. This is usually done with legal entities, or cost andprofit centers at the base level, then consolidating by region, responsibility,or by a defined legal structure. Each entity stores data for the necessaryconsolidation points. During a consolidation, all the children of a parent areloaded into memory for the system to aggregate all base-level data to storefor the parent. This works very well for the structures that are common inconsolidation systems. Still, very flat entity dimension structures canexperience performance issues due to the amount of information that mustbe cached. HFM has had many improvements in recent releases that resolvememory issues, and these improvements along with subcube enhancementsare discussed later in this chapter. However, versions used before System 9and applications with large entity structures should consider adding parents,if for nothing else than to improve performance. These additional entitiescan help make the application more user-friendly, providing more groupingsfor reporting and drilling on the data.

    There are several settings for the Entity dimension to consider whenadding new members to the Entity dimension. Figure 1-15 shows a sampleEntity. The following list shows the key attributes that must be defined; youshould spend extra time understanding the impact of these attributes.

    Member Labels are restricted to 80 characters, can be alphaand/or numeric. Dont forget to put some thought into your namingconvention.

    DefCurrency This is the default currency for the entity. It shouldbe the functional currency of the entity.

    AllowAdjs Having this attribute set allows journals to be posted to thevalue member Entity Currency Adjustment and the Parent CurrencyAdjustment members. Now with this enabled, it also allows HFM to run

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  • Sub Calculate there. This feature is not well known, but it can speedyour consolidations. If you dont have journals there, there is no need torun calculations on these members.

    IsICP This attribute determines whether this entity will be anintercompany partner for any intercompany transactions. Flaggingthis as Y (yes) will create a member in the ICP dimension, and allowfor input of intercompany accounts to an ICP member with the samelabel as the entity. Selecting R (restricted) will allow for the sameconditions as Y will; however, it will prevent people from posting toan intercompany partner with the same label as the entity you areentering data in. This prevents people from recording intercompanyactivity with themselves. I would recommend using R unless youare certain you are not reporting at the lowest legal entity in theapplication.

    AllowAdjFromChildren Having this set allows journals to be posted tothe value member Contribution Adjustment and the Parent Adjustmentmembers.

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    FIGURE 1-15. Sample Entity

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  • UserDefined13 User-defined attributes are used to enhance theflexibility of rules and for creating lists. Rules can be conditionallybased upon these fields.

    HoldingCompany This field is used to identify the Holding Companyfor this entity. It can be referenced in the rules. When you are buildingrules in the system for the consolidation, you will see how this field iscritical.

    ValueThe most important dimension is the Value dimension. It is the part of theproduct that drives the consolidation in HFM. When you really understandhow the Value dimension works, you understand how HFM really doesconsolidations. It is critical for writing rules. It isnt just how HFM bringsthe data together, but it tells you how the rules are working to move dataup the entity structure to consolidate the data. The Value dimension is asystem-generated, system-maintained dimension within HFM. You cantmodify it directly.

    I say directly because the Value dimension has members based oncurrencies you add, and you can make some minor changes to defaultmembers.

    The first thing you notice when you look at the Value dimension is thatall of the currencies you add in the application are replicated there. All thecurrencies in the Value dimension are referenced by something called atriplet. A triplet is a grouping of an input member, an adjustment member,and a total. For example, if you had a USD currency you would see for thatcurrency a USD, USD ADJ, and USD Total. You should see a triplet forevery currency you have in the application.

    So lets talk through the Value dimension. Figure 1-16 is an example of theValue dimension and how data moves from one member to another. Data isloaded only to . Every entity has only one default currency.So even though you see all of the currencies in the Value dimension, you canonly load to onethe . You can make a local currencyadjustment in HFM through the journals module in a member called . These two members sum to a total called . Thisis also a triplet, and it points to the currency triplet that is the default currencyof the entity. If I had an entity with a functional currency of EUR (the euro),

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  • and I loaded data to Entity Currency, I would see the values I loaded in boththe value member EUR and . That would be true when Iload the data, if I chose EUR or Entity Currency in my load file.

    The reason is that the and for that matter, all of thevalue members that relate to the entity, identified by opening and closingangle brackets (), are just pointers to the currency defined in theValue dimension. They arent real members that store the data. When youload data to an Entity member of the Value dimension, it is valid anywherethe entity appears in the application.

    Once we have the functional currency and adjustments completed, wecan do translation. We want to translate the entity before we do any othercalculations like eliminations or ownership calculations. By default, HFMwill translate to the currency of the parent. If local currency and parentcurrency are different, then HFM will by default have translation. First, thedata in the is cleared, then HFM takes , runs the Sub Translate routine, and moves . Oncethe data moves to , the Sub Calculate rules are run again.

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    FIGURE 1-16. The Value dimension

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  • also has an adjustment member you can addadjustment values to called . Those journal values aremade in the parent currency of the entity. Both and the are added together on the fly to give . Once you move to the next member, you will notice that the bracketschange from angle brackets (< >) to square brackets ([ ]).

    The next member is [Parent]. The Parent member defines the firstmember that is part of the Node. There is also a [Parent Adj] and [ParentTotal]. These members are also in the parents currency, but unlike , they are part of the Node.

    The Node is the unique relationship between a parent entity and eachof its children. For example, if I were an entity that made French bicycles,I could roll up to two parents. I could roll up to Total Bicycles and TotalFrance. Figure 1-17 shows this example.

    The eliminations and consoldiation calculations would likely be verydifferent depending which parent it consoldiates. The Value dimensionallows this.

    The [Parent Total] using consolidation rules, either default or custom,will write values to [Elimination] and [Proportion]. Eliminations occur afterany Proportion has been calculated (any non-100-percent consolidations),and the total is stored.

    AccountThe Account dimension represents a hierarchy of natural accounts.Typically, the accounts store financial data for entities and scenarios in anapplication. Each account has a type, such as Income or Expense, thatdefines its accounting behavior. You can use accounts for other types ofdata, like headcount, units, or inventory. Those accounts typically use other

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    FIGURE 1-17. The Node, the relationship of a parent and child entity

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  • types, like Balance. The account type is one of the first required settingsafter you have defined the label and description.

    Asset, Liability Accounts used on the balance sheet; these do notrecognize period changes. If you had an asset Cash that had 10,000,it would be 10,000 year to date and 10,000 periodic.

    Expense, Revenue Accounts used for the income statement; theseaccounts do show period change. Revenue was called Income, butthey are the same. If you had an revenue account called Sales thathad 10,000, it would be 10,000 year to date and the differencebetween the months for the periodic.

    Flow Behaves like an Expense or Revenue account, but will nottranslate.

    Balance Behaves like an Asset or Liability account, but will nottranslate.

    Balancerecurring Allows you to enter data in one period and haveit carry forward until the end of the year. If you entered 500 inJanuary, then 500 would appear for all the months after January.This would only carry until the end of the year, and then the dataneeds to be entered in the next year.

    Currencyrate These accounts allow use of currencies in Custom1and Custom2. A commonly used account would store the end ofmonth rate (EOMRate). Then you can enter a translation rate. Therule of thumb here is to enter the rates as they translate fromCustom1 to Custom2. So if you were going to translate a EUR entityto a USD parent, the data would be A#EOMRate.C1#EUR.C2#USD.These accounts are Balancerecurring, so if you dont enter a rate inthe next month, it will use the last one entered.

    Grouplabel Used to group accounts, Grouplabel will not store avalue. You may want a group called Administrative; this would bea nice way to group all the tax and translation rate accounts.

    Dynamic Indicates that the account is calculated dynamically, onthe fly. The accounts are typically simple ratios and require aspecial rule.

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  • Once those account types are defined, you need to consider some of theother settings.

    CalcAttribute This field allows you to describe the calculations inthe rules file that are done for this account. It can be viewed by usersin grids and forms. You can enter in plain English what the rule isdoing. This feature is not used enough in HFM applications. A well-designed application will include this.

    DefaultParent The default parent for the account.

    EnableDataAudit Y to enable account auditing or N to disableauditing. To use this functionality, you will need to also turn this onusing the Scenario attributes.

    ICPTopMember The ICP top member for the account. If you wantto prevent entry or usage of [ICP None], this setting can force usersto identify a specific intercompany partner when they use thisaccount.

    IsICP Identifies the account as an intercompany account. Y willmake the account valid for all members of the ICP dimension, N willallow ICP None to be the only valid member for loading data, and Rwill make the account valid for all members of the ICP dimensionexcept for the ICP member that has the same name as the entityloading data.

    PlugAcct Consider this a suspense account for identifying andresolving intercompany matching issues. It is required for accountsto self-eliminate if the consolidation rules are not used.

    IsCalculated This should be used on all base calculated accounts;it prevents input and tells HFM to clear data values before rules arerun at key points of the consolidation.

    IsConsolidated Allows the account to consolidate in the Entity/Value dimensions. If this is not selected, an account will not movepast in the Value dimension.

    Submission Group For Phased Submission, this setting will identifythe submission group.

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  • UsesLineItems Y if the account uses line item detail and N if theaccount does not. This also needs to be flagged in the scenario ifyou want to have line item detail.

    XBRL Tags This is a field where you can enter XBRL tags for theaccount. This setting is not related to Disclosure Management (DM).I would not use it for any substantive XBRL reporting.

    Figure 1-18 shows a typical account and the key settings described.

    System AccountsHFM provides a set of accounts that can be used to help with complexconsolidation and calculations. These accounts help drive consolidationrules, and that is covered later in the book when Rules are covered inChapter 3. All system accounts are Balance accounts except for the Active

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    FIGURE 1-18. The Account dimension

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  • account, which is a Balancerecurring account. You can modify thedescription, security class, and the decimal location for system accounts.

    [PCON] Percent consolidation

    [POWN] Percent ownership

    [DOWN] Percent of direct ownership

    [PCTRL] Percent control

    Active Determines whether the entity should consolidate in theperiod

    SharesOwned Total number of shares owned

    VotingOwned Number of voting shares owned

    SharesOutstanding Total number or percentage of sharesoutstanding

    VotingOutstanding Number of voting shares outstanding

    Shares%Owned Calculated based on above account information

    Voting%Owned Calculated based on above account information

    Intercompany Partner (ICP)The Intercompany Partner dimension provides detail for all intercompanybalances that can exist for an account. Oracle Hyperion Financial Managementcan track and eliminate intercompany transaction details across entitiesand accounts. This dimension is defined when you flag an Entity as anintercompany partner. The member labels will mirror those entities flagged.

    Figure 1-19 shows the screen where you will set up an application forintercompany transactions. You must perform these actions:

    1. Indicate the accounts that perform intercompany transactions andindicate a plug account for each intercompany account (IsICP andPlugAcct attributes in account metadata).

    2. Indicate the entities that perform intercompany transactions (IsICPattribute in entity metadata).

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  • The plug account created should always be intercompany. It is valuableto see the matching by intercompany partner when trying to resolve a dataissue.

    Custom DimensionsIn addition to the eight system-defined dimensions, Hyperion FinancialManagement provides four custom dimensions. You use the customdimensions to store additional detail, such as products, measurementadjustments, or balance sheet movement. For example, you can have acustom dimension for products associated with your Sales account that youcan use to track sales by product.

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    FIGURE 1-19. Configuring Intercompany

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  • It is best to think of custom dimensions as another view of the accounts.For example, you may want to view your operating Expense by Function orDepartment. You may want to see Revenue by Product. In those cases youcan put Function and Product in a Custom dimension. Then, by attachingthe custom dimensions to the accounts, you create a valid intersection ofthe account and Custom dimensions. Now in this example, you do not haveany overlap of the customs. Revenue is only valid for Product and Expenseis valid only for Function. Since there is no overlap, you can put bothmembers in the same Custom member.

    To attach them to the accounts, you only need to do two steps. First,attach the top Product member to the Revenue accounts, and the topFunction member to the correct Expense accounts. Second, enableAggregation for each of the accounts.

    Consolidation MethodsConsolidation methods are used during the consolidation process to allowHFM to properly calculate the amount that is written to the [Proportion]Node. Normally, there are three consolidation methods you might usedepending on the strength of the parent companys control or influence: fullconsolidation, proportionate, and the equity. The basic principle consists ofreplacing the historical cost of the parents investment in the company beingconsolidated with its assets, liabilities, and equity. You can actually createany names you want, but those are the most common. The methods youdefine will automatically generate in the [ConsolMethod] system list for theCustom1 dimension. The Consolidation method can be populated eithermanually through data load or data entry, or populated in the rules, whichare based on the ultimate percent control for the entity. Consolidationmethods are also used to write to the [Elimination] member.

    POWNMIN is a keyword you use for the method corresponding to theEquity method. The settings in this table are used by the OwnershipCalculation routine to compute the percentages of control, the ultimatepercentages of ownership, and to assign the percentages of consolidationand the consolidation methods for legal consolidation. Using POWNMIN,the percentage of consolidation that is assigned for the Equity Companycorresponds to the percentage used in a staged consolidation POWNMINcalculation.

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  • These methods are ways you can consolidate the data in yourapplication. You can build them in whatever way you need to run theconsolidation. I have seen some very common ones. I am sure each readerwill have seen some twist on each of these, so I will keep the examplesgeneric.

    Full consolidation is used when there is majority ownership or control(greater than 50 percent of voting shares) by one parent of its subsidiaries.The two companys financial statements are combined by account, with anyadjustments and eliminations. This can mean the consolidated accountshave only part of the values consolidated to a given parent. For example,if you have 100 in revenue, but own 65 percent, you would only see65 consolidate to the parent. Statement of Financial Accounting Standards(SFAS) 94, issued in 1987, states that majority-owned subsidiaries (morethan 50 percent of the voting stock has been acquired), should be fullyconsolidated and that accounting by the Equity method (generally used foraffiliates less than 50 percent owned) is not a substitute for informationprovided by fully cons