GNM_RCS_Chart_of_Accounts_FS

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• 1. Introduction

     1. Purpose

GNM makes financial commitments to contributors by entering into commissions and contracts with them, and also committing to royalty payments, expense payments and other payments to contributors. GNM also sells licences for the reuse of content to Customers though aggregated syndication contracts and standalone licences.

Each purchase and sale must be recorded correctly in the accounts by linking it to the correct codes in the chart of accounts. RCS (including SLM) record these codes against transactions and send this data through to Oracle with each payment instruction or instruction to invoice.

• 1. Scope

This document is intended as a high-level document outlining the use of the chart of accounts in RCS. It is not a detailed functional specification from which the system could have originally been developed.

Separate Technical specifications document the implementation of these functions.

• 1. Chart of accounts

The GNM chart of accounts is owned by the Finance department as at the time of writing is available on Spike (GNM’s intranet portal) via this link:

http://spike/content/513

The chart of accounts is used to categorise all expenditure and income.

• 1. Chart segments

The Excel document available for download from the above link represents the chart of accounts. It lists all of the available codes for the 8 segments that make up a full coding. These segments are:

• 1. Legal entity;

  2. Cost centre;

  3. Account;

  4. Product;

  5. <Spare>;

  6. Analysis 1;

  7. Analysis 2; and

  8. Project.

The 5th segment is not used and so the value “00” is always used.

All of the other segments record a hierarchy of codes available along with their meaning. Only the “leaf nodes” i.e. codes with no children can be applied to a transaction. However the parent nodes are very useful for reporting on sections of the chart of accounts.

A housekeeping screen in RCS enables a copy of the chart of accounts to be maintained in RCS. Only those codes that are required are maintained. This set of codes is used for all expenditure and for syndication contracts.

A separate housekeeping screen in SLM manages the subset of the income codes use for licence requests. The model in SLM is far simpler than the RCS model and exists separately for historic reasons.

Oracle will only permit valid combinations of segment codes but rather than trying to replicate the rules in RCS, RCS can ask Oracle (using an API) if a combination is valid prior to sending the details of the transaction to Oracle.

• 1. User permissions

Each user logon is granted access to the chart of accounts codes they need. This reduces the chance of error and ensures each user only has to choose from a short list of codes relevant to them.

Access to the 2nd segment, the cost centre, is also a key part of the data security model within the system. Users can only maintain financial data relating to cost centres they have access to.

RCS administrators, Rights department users and Finance users are able to see all cost centres.

• 1. Expenditure

Every expenditure item must be linked fully to the chart of accounts before a payment instruction can be sent to Oracle AP or Payroll.

The implementation of the chart of accounts in RCS aims to achieve the following:

• • Maintain an accurate list of valid codes;

  • Ensure codes are only used for the correct purpose e.g. contracts, or spikes, or royalties etc.;

  • Ensure users can only use codes relevant to them, preventing errors; and

  • Ensure segment values are defaulted as far as possible, saving users time.

• 1. Accurate lists of codes

The RCS administrator manages the list of chart of accounts codes in RCS. Codes can be added, definitions changed, or they can be disabled. New codes tend to be requested by Editorial staff or they may be introduced by Finance. The same hierarchy is maintained in RCS as in the Finance chart of accounts, even down to the colour coding of hierarchy levels, to make it as easy to use and consistent as possible.

The RCS administrator coordinates with the Finance team to ensure any new code is created in Oracle prior to it becoming available in RCS. This ensures codes are not sent to Oracle before the codes have been setup in that system.

• 1. Ensuring correct usage

The RCS administrator can determine whether or not a code can be used for each of the following payment types:

• • Commissions;

  • Staff commissions;

  • Spikes;

  • Contracts;

  • Expenses / other payments;

  • Credit notes;

  • Sales Royalties; and

  • Syndication contracts.

• 1. User permissions

Each RCS user is granted access to a subset of the chart of accounts codes – just those they need to apply to payments.

New codes can be added to a user account and existing codes removed from it.

• 1. Applying defaults

For each segment one of the codes a user has access to can be defined as the default value to be used. This facility is available for each of the following expenditure types:

• • Commissions;

  • Staff commissions;

  • Contracts;

  • Expenses / other payments;

  • Sales Royalties; and

  • Syndication contracts.

• 1. Income

All licence sales in SLM must be linked fully to the Chart of Accounts codes before invoice instructions can be sent to Oracle AR.

The model used in SLM is far simpler than that described in the previous section for RCS as all SLM users have access to all codes.

In this model the 8 segments are defined and for each segment a list of valid codes is maintained. For each segment code the RCS administrator can determine whether or not the code can be used for the following types of sale:

• • Text;

  • Images;

  • Audio; and

  • Video.

For segment 7 “Analysis 2” there are no restrictions applied to the codes.

For segment 8 “Project”, a code may be designated as any of the above, or as one where a “3rd party commission fee is payable”. This occurs where a sales commission is due to another organisation with which GNM has a contract e.g. IDS.

• 1. User permissions

No system restrictions are applied to who can use which codes.

• 1. Applying defaults

If only one code is available for a particular type of sale then that code will be used as the default code for the relevant segment. Ideally all segments are defaulted.

End of Document