Cash Flow Series, Part I: 2-dimensional vs 3-dimensional

Cash Flow Series, Part I: 2-dimensional
vs 3-dimensional
How to Make Your Data Stand Out
August 17, 2018
Matt Spencer

OUR HISTORY
A brief history of our partnerships
Oracle Gold Partner Finit
• Founded in 2002
• 90+ employees in 20+ states
• Mostly CPAs, MBAs
• 300+ Clients – all CPM / EPM
Focused
• 1,000+ CPM / EPM projects
• 20+ Fortune 100, 60+
Fortune 500, 100+ Fortune
1000
OneStream Platinum Partner
• 150+ HFM Projects
• Managed largest roll-out of
HFM in North America
• 175+ FDM Projects
• World leader in FDM
implementations and
custom solutions
• 100+ Planning / Essbase
projects
• 40+ OneStream Clients
(Market Leader)
• #1 Implementer of
OneStream
• Platinum Partner
• First OneStream
MarketPlace App
• RequestIT

The Finit Model
Fully aligned with
our clients, not just
bottom line $
No debt or external
ownership
Work with Finit
employees, no
subcontractors
Compensation
based on CLIENT
SATISFACTION
PRIVATELY
OWNED
CLIENT
SATISFACTION
NO
SUBCONTRACTORS
DEBT FREE

Our values, culture, and approach to
becoming a trusted advisor to our
customers has led to
100% CUSTOMER SUCCESS
for every project since our inception
in 2002
300+ Clients
1,000+ Projects

About the Presenter
Matt Spencer
(mspencer@finit.com)
Experience
10 years with Hyperion suite
7 years in financial reporting for public and
privately held companies
Certification/Education
BS – Accounting, Finance, University of Kansas (Rock
Chalk!)
Licensed CPA
Certified Management Accountant
HFM Certified
Client Testimonial
Finit has a remarkable reputation and no matter who you meet from the
company, you can understand where the comments come from. Each of them
is knowledgeable in so many aspects and takes the time to make sure the client
fully understands the topic. They exceed the bar of professionalism while
maintaining an enjoyable atmosphere.

Agenda
• Cash Flow Primer
• 2D vs. 3D – How do the approaches, input, and outputs differ?
• 2D Approach
• Summary / Ideal Candidates
• 2D Example #1
• 2D Example #2
• 3D Approach
• Summary / Ideal Candidates
• 3D Example #1
• 3D Example #2
• Comparison Grid

Cash Flow Statement – What is it?
Definition – The financial statement that presents the sources and
uses of cash during the specified reporting period
Beginning Cash $100,000
Net cash from operating activities 85,000
Cash used in investing activities (10,000)
Cash used in financing activities (25,000)
Net increase in cash 50,000
Ending cash $150,000

Cash Flow Statement Topics
• Operating Activity
• Direct vs. Indirect Methods
• Investing Activity
• Financing Activity
• Translation –to keep things clean, our examples will assume all USD
– tune in next week for non-cash items and CTA!

Cash Flow Statement – Operating Activity

Cash Flow Statement – Operating Activity
• Definition – Cash inflows and outflows that relate directly to the company’s
day-to-day activities
Cash flows from operating activities
Net Income 150,000
Adjustments to reconcile earnings to cash
Depreciation 25,000
Amortization 10,000
Changes in assets and liabilities
Accounts receivable (60,000)
Inventory (15,000)
Accounts payable (25,000)

Operating Cash Flow – Direct vs. Indirect
**Only for Operating section – no difference for Investing or Financing**
• Direct: Directly calculating your operating cash flow using specific known
activity – ground-up approach
• Indirect: Indirectly calculating your operating cash flow by backing into an
amount – identifiable items approach
• 99% of companies use indirect – imagine Apple or GE trying to calculate a
direct cash flow tracking every cash inflow and outflow at a consolidated level
Net
Income
+ / -
Noncash
Inc / Exp
+ / -
Change in
Current Assets
=
Operating
Cash Flow
Cash from
customers
-
Cash to
suppliers
-
Pay to
employees
+/- … =
Operating
Cash Flow

Cash Flow Statement – Investing Activity

Cash Flow Statement – Investing Activity
• Definition – Cash used in and generated from the purchase and sale of
investments and long term assets
Cash flows from investing activities
Purchases of PPE (50,000)
Cash from sales of PPE 48,000
Purchases of investments (8,000)

Cash Flow Statement – Financing Activity

Cash Flow Statement – Financing Activity
• Definition – Transactions with owners/shareholders and debtholders – those
with a direct financial interest in the company
Cash flows from financing activities
Issuance of debt 80,000
Payments on debt (90,000)
Payments of dividends (15,000)

Cash Flow Statement – Recap
Definition – The financial statement that presents the sources and
uses of cash during the specified reporting period

Cash Flow 2D vs. 3D -
Introduction

2D vs. 3D - Overview
• What are the D’s, what do they represent?
• The different Dimensions provide us with details around the activity shown
in the cash flow statement
• 1st D is the account dimension (most of the time), other 2 typically
in custom dimensions
• 1st Dimension – Account
• 2nd Dimension – Input vs. Calculated identifier
• 3rd Dimension – Related balance sheet accounts
• 2D uses the first 2 dimensions to report GAAP CF accounts, 3D
adds the balance sheet detail

2D – Ideal Candidates
• Higher sensitivity to calculation times/logic complexity
• Less focus on cash flow statement analysis – or at least out of the system
• Desire for application simplicity – less dimensions used
• Need to restrict cash flow accounts from adjustments – depreciation, etc.
• No or few roll forwards in the application

2D – Application Contents
• Account dimension would be set up with GAAP
cash flow accounts
• Custom dimension would have some type of
input vs. calculated member
• We want this because…
• Rules to populate the calculated members
CFTot Total Cash Flow Activity
CFCalc Calculated Cash Flow Amounts
CFAdj Input Cash Flow Amounts
CashFlow
CF_NetIncrDecrCash
CF_OperatingActivities
CF_FinancingActivities
CF_InvestingActivities
CFX_Cash
CF_BegCash
CF_EndCash

2D - Automation
• Many lines can be populated from financial statements, specifically operating
activities:
• For these items, the logic would set the cash flow account for Net Income equal to the value
that is in the income statement account. Balance sheet accounts would be prior period less
current period, or vice versa
YTD net income from the income statementCF Net Income
CF Depreciation
CF Net Change AR
CF Net Change
Inventory
CF Net Change AP
CF Net Change Def
Taxes
YTD depreciation from the Income Statement
Prior Dec less current period AR
Prior Dec less current period Inventory
Current period less prior Dec AP
Prior Dec less current period deferred taxes

2D – Typical Reporting
Beginning Cash Balance 100,000$
Net Income 150,000
Depreciation 25,000
Amortization 10,000
Accounts receivable (60,000)
Inventory (15,000)
Accounts payable (25,000)
Purchases of PPE (50,000)
Cash from sales of PPE 48,000
Purchases of investments (8,000)
Issuance of debt 80,000
Payments on debt (90,000)
Payments of dividends (15,000)
Ending Cash Balance 150,000$

2D – Example #1 – Account Prefix Approach
• Company profile
• International public pharmaceutical company
• 10,000 Employees
• $4B+ in Revenue
• Metadata
• Account dimension for GAAP cash flow accounts
• Custom dimension for calculated vs. input values
• Logic
• Activity is sourced based on account prefix

CF_NET_CHANGE Net increase (decrease) in cash and cash equivalents
CF_OPERATING Cash Flow s From (For) Operating Activities
CFP_NET_INC Net income
CF_ADJ_RECON_NETINC Adjustments to derive cash flow s
CFP_WRITEOFF_R_D Write-off of in-process research and development
CF_RESTRUCT_EXP Restructuring expense
CF_IMPAIRMENT Asset impairment
CFR_NET_GDWLL_IMPAIRMENT Net goodw ill impairment
CF_GAIN_LOSS Gain (loss)
CFR_INVST_SEC_REAL_GAIN_LOSS Investment securities realized gain (loss)
CF_OTHER_GAIN_LOSS Other gain (loss)
CF_OTHER_NON_CASH_ADJ Other non cash adjustments
CF_DEPR_AMORT Depreciation and amortization
CFR_NET_PPE_DEPRECIATION Depreciation
CFR_NET_INTANGIBLE_AMORTIZATION Amortization
CF_EXC_TAX_BENEF_STK Excess tax benefit of stock transactions
CF_DEF_TXS Deferred income taxes
CFB_CURR_DEF_TX_AST Current deferred income tax assets
CFB_NC_DEF_TX_AST Non current deferred tax assets
2D – Example #1 – Metadata – Account
**Take note of the prefixes, we’ll talk about those in a minute

2D – Example #1 – Metadata – Account
• 4 types of account prefixes
• CF_ : Input accounts – manually entered into HFM via template or some other method
• CFP_ : YTD activity pulled from the P&L (income statement)
• CFB_ : YTD change pulled from the Balance Sheet
• CFR_ : YTD activity pulled from Roll Forwards
• The prefixes on these accounts will drive which rules apply to the account
• All accounts marked “N” for “is calculated” attribute – that is driven by the
Custom1 input type attribute – discussed next

2D – Example #1 – Metadata – Data Type
• For the data type, or input vs. calculated designation, these members are stored in
the Custom1 dimension. Any custom dimension can be used, but this type of activity
fits best in a dimension where you don’t need to see other detail for cash flow
activity. In this case, C1 also holds the company’s roll forwards
Is Calculated
CF_Total Cash Flow Total N
CF_Calc Cash Flow Calculation Y
CF_Adj Cash Flow Adjustments N
CF_Non_Cash_Adj Cash Flow Non Cash Adjustments N
CF_Derivatives Cash Flow Adjustments - Derivatives N
CF_Post_Retire Cash Flow Adjustments - Post Retirement N
CF_LT_Investments Cash Flow Adjustments - LT Investments N
CF_Def_Tax_Reclass Cash Flow Adjustments - Def Tax Reclass N
CF_FIN48 Cash Flow Adjustments - FIN48 N
CF_Stock_Options Cash Flow Adjustments - Stock Options N
CF_Other_Adj Cash Flow Other Adjustments N
Member Name Description
No manual
adj. allowed!

2D – Example #1 - Logic
• To populate the cash flow accounts, the rules look at the cash flow account member names,
which are delimited by an underscore
• Example 1 – CFP_NET_INC
• Example 2 – CFB_NC_DEF_TX_AST
• Example 3 – CFR_NET_GDWLL_IMPAIRMENT
“CFP” accounts
pull YTD activity
The text after the first “_” tells the rule
which account to source data from
“CFB” accounts
pull YTD change
which account to source data from
“CFR” tells the rule to
go pull YTD roll
forward activity
which C1 roll forward member to
source the data from

CF_NET_CHANGE Net increase (decrease) in cash and cash equivalents
CF_OPERATING Cash Flow s From (For) Operating Activities
CFP_NET_INC Net income
CF_ADJ_RECON_NETINC Adjustments to derive cash flow s
CFP_WRITEOFF_R_D Write-off of in-process research and development
CF_RESTRUCT_EXP Restructuring expense
CF_IMPAIRMENT Asset impairment
CFR_NET_GDWLL_IMPAIRMENT Net goodw ill impairment
CF_GAIN_LOSS Gain (loss)
CFR_INVST_SEC_REAL_GAIN_LOSS Investment securities realized gain (loss)
CF_OTHER_GAIN_LOSS Other gain (loss)
CF_OTHER_NON_CASH_ADJ Other non cash adjustments
CF_DEPR_AMORT Depreciation and amortization
CFR_NET_PPE_DEPRECIATION Depreciation
CFR_NET_INTANGIBLE_AMORTIZATION Amortization
CF_EXC_TAX_BENEF_STK Excess tax benefit of stock transactions
CF_DEF_TXS Deferred income taxes
CFB_CURR_DEF_TX_AST Current deferred income tax assets
CFB_NC_DEF_TX_AST Non current deferred tax assets
2D – Example #1 – Output
YTD activity
for NET_INC
YTD activity for
NET_GDWLL_IM
PAIRMENT
YTD change in
NC_DEF_TX_AST

2D – Example #2 – User Defined Approach
• Company profile
• Public manufacturing company
• $10B+ in Revenue
• Metadata
• Logic
• Activity is sourced based on a User Defined Field (UD1)

2D – Example #2 – Metadata - Account
The UserDefined1 defines
which P&L or Balance Sheet
account will be the source of
data for the cash flow account
The Account Type of the data
source account is then referenced
to determine if YTD activity or
change will be populated to the
cash flow account
CashFlow
CF_NetIncrDecrCash
CF_TotalNoncashItems
CF_DeprExp
CF_AmortExp
CFP_Impairment
CFP_910000
CFP_6121800
CF_NonCashIntExp
CF_GainLossSaleofPPE
CF_ChgAssetsLiabsNetOfAcq
CF_AR
CF_Inv
CF_AP
CF_AccrSalBen
CF_OthAccSalBen
CF_OthAssetsLiabs

2D – Example #2 – Metadata – Data Type
• Similar to the previous example, this approach also uses a custom dimension
to differentiate between calculated and inputted cash flow amounts

• The rules to populate the cash flow loop through all base cash flow accounts
and perform the following steps:
• 1. Look at the UD1 for the cash flow account
• 2. Look at the account type for each UD1 member
• 3. For assets and liabilities, populate the YTD change to the CF account, for
revenue and expense, use YTD activity

2D – Example #2 – Output
CashFlow
CF_NetIncrDecrCash
CF_TotalNoncashItems
CF_DeprExp
CF_AmortExp
CFP_Impairment
CFP_910000
CFP_6121800
CF_NonCashIntExp
CF_GainLossSaleofPPE
CF_ChgAssetsLiabsNetOfAcq
CF_AR
CF_Inv
CF_AP
CF_AccrSalBen
CF_OthAccSalBen
CF_OthAssetsLiabs
The activity in these cash
flow accounts would be
driven by the UD field for
each member

3D – Account, Data Type, and
Balance Sheet Association

3D – Ideal Candidates
• Less sensitivity to calculation times
• Higher focus on cash flow statement analysis and determining the drivers for
cash flow activity
• Need to restrict cash flow accounts from adjustments – depreciation, etc.
• Many rollforwards, or desire to be able to roll forward the full balance sheet.

3D – Application Contents
• Account dimension would be set up with GAAP
cash flow accounts
• Custom dimension would have some type of
input vs. calculated member
• Additional custom dimension to reflect which
balance sheet accounts drive cash flow activity
CFTot Total Cash Flow Activity
CFCalc Calculated Cash Flow Amounts
CFAdj Input Cash Flow Amounts
CashFlow
CF_NetIncrDecrCash
CF_FinancingActivities
CF_InvestingActivities
CFX_Cash
CF_BegCash
CF_EndCash

3D - Automation
• Many lines can be populated from financial statements, specifically operating
activities:
• For these items, the logic would set the cash flow account for Net Income equal to the value
that is in the income statement account. Balance sheet accounts would be prior period less
current period, or vice versa
YTD net income from the income statementCF Net Income
CF Depreciation
CF Net Change AR
CF Net Change
Inventory
CF Net Change AP
CF Net Change Def
Taxes
YTD depreciation from the Income Statement
Prior Dec less current period AR
Prior Dec less current period Inventory
Current period less prior Dec AP
Prior Dec less current period deferred taxes

NetCashBS CFAR CFINV CFPPEBUILDING CFPPEMACHINE CFAFSSEC CFDEBT CFAP CFRE
Beginning Balance 170,000$ 100,000 200,000 500,000 250,000 - (20,000) (300,000) (900,000)
Net Income 200,000 (200,000)
Depreciation 15,000 (10,000) (5,000)
Accounts receivable (60,000) 60,000
Inventory (15,000) 15,000
Accounts payable (25,000) 25,000
Purchases of PPE (50,000) 30,000 20,000
Cash from sales of PPE 48,000 (48,000)
Purchases of investments (8,000) 8,000
Issuance of debt 80,000 (80,000)
Payments on debt (90,000) 90,000
Payments of dividends (15,000) 15,000
Ending Balance 250,000$ 160,000 215,000 520,000 217,000 8,000 (10,000) (275,000) (1,085,000)
3D – Typical Reporting
3D!

3D – Example #1 – Member Name Approach
• Company profile
• Fortune 500 company
• Metadata
• Custom dimension for associated balance sheet account
• Logic
• Activity is sourced from member names

3D – Example #1 - Overview
CFTTL_CASH CFAR_BAL CFINV_BAL CFPPEBUILDING CFPPEMACHINE CFAFSSEC CFAP_BAL CFDEBT CFRE
BEGINBAL 450,000 100,000 200,000 250,000 300,000 - (300,000) (600,000) (400,000)
CF_OPERATING (65,000) 30,000 150,000 (20,000) (30,000) - (15,000) - (50,000)
CF_NETINCOME 50,000 (50,000)
CF_DEPAMORT 50,000 (20,000) (30,000)
CF_IMPAIRMENT -
CF_GAINLOSSSALE -
CF_DEFERREDTAXEXPBEN -
CF_WORKINGCAPITAL (165,000) 30,000 150,000 - - - (15,000) - -
CF_AR (30,000) 30,000
CF_AP 15,000 (15,000)
CF_INV (150,000) 150,000
…. (298,000) 50,000 25,000 8,000 200,000 15,000
ENDBAL 87,000$ 130,000 350,000 280,000 295,000 8,000 (315,000) (400,000) (435,000)

3D – Example #1 - Metadata
• Account dimension: Utilized for the GAAP cash flow accounts (left column
going down the page) CFTTL_CASH CFAR_BAL CFINV_BAL
BEGINBAL 450,000 100,000 200,000
CF_OPERATING (65,000) 30,000 150,000
CF_NETINCOME 50,000
CF_DEPAMORT 50,000
CF_IMPAIRMENT -
CF_GAINLOSSSALE -
CF_WORKINGCAPITAL (165,000) 30,000 150,000
CF_AR (30,000) 30,000
CF_AP 15,000
CF_INV (150,000) 150,000
…. (298,000)
ENDBAL 87,000$ 130,000 350,000

CFTTL_CASH CFAR_BAL CFINV_BAL CFPPEBUILDING CFPPEMACHINE
BEGINBAL 450,000 100,000 200,000 250,000 300,000
CF_OPERATING (65,000) 30,000 150,000 (20,000) (30,000)
CF_NETINCOME 50,000
CF_DEPAMORT 50,000 (20,000) (30,000)
CF_IMPAIRMENT -
CF_GAINLOSSSALE -
CF_WORKINGCAPITAL (165,000) 30,000 150,000 - -
CF_AR (30,000) 30,000
CF_AP 15,000
CF_INV (150,000) 150,000
…. (298,000) 50,000 25,000
ENDBAL 87,000$ 130,000 350,000 280,000 295,000
• Custom2 dimension: utilized for the balance sheet category associated with
the cash flow account (the part going across the top)

• Custom4 dimension: utilized for the cash flow data type
Member Name Description Is Calculated
CF_DATA Total Cash Flow Data N
CF_CALC Calculated Cash Flow Data Y
CF_ADJUST Cash Flow Manual Inputs N
No manual
adj. allowed!

3D – Beginning Balance
CFTTL_CASH CFAR_BAL CFPPEMACHINE CFAP_BAL
BEGINBAL 450,000 100,000 300,000 (300,000)
CF_OPERATING (65,000) 30,000 (30,000) (15,000)
CF_NETINCOME 50,000
If right 4 characters are
_BAL, then beginning
balance is taken from the
BS member between “CF”
and “BAL”.
Asset beginning balances are
the positive amount from last
period of prior year
Liability beginning balances
are the negative amount from
last period prior year
If no _BAL in the name,
then beginning balance is
taken from the member
after “CF”

3D – Ending Balance
CFTTL_CASH CFAR_BAL CFPPEMACHINE CFAP_BAL
CF_AR (30,000) 30,000
CF_AP 15,000 (15,000)
CF_INV (150,000)
…. (298,000) 25,000
ENDBAL 87,000$ 130,000 295,000 (315,000)
If right 4 characters are _BAL,
then ending balance is taken
from the BS member
between “CF” and “BAL”.
Asset ending balances are the
positive amount from the
current period
Liability ending balances are
the negative amount from the
current period
If no _BAL in the name, then
ending balance is taken from
the member after “CF”

3D – Balance Sheet Movement
For C2 members ending in _BAL, the amount for the movement member will be populated
from the difference between the beginning and ending balance.
1. Members ending in _BAL are populated to a member list
2. Members in that member list are looped through and the difference between the ending
and beginning balance is populated to the CF accounts ending in the member that is
between the “CF” and “_BAL” pieces of the member 2 name
CFAR_BAL CFAP_BAL
BEGINBAL 100,000 (300,000)
CF_OPERATING 30,000 (15,000)
CF_AR 30,000
CF_AP (15,000)
….
ENDBAL 130,000 (315,000)
(315,000) End Bal
- (300,000) Begin Bal
(15,000) Change130,000 End Bal
- 100,000 Begin Bal
30,000 Change

3D – P&L Activity
CFTTL_CASH CFAR_BAL CFINV_BAL CFPPEBUILDING
BEGINBAL 450,000 100,000 200,000 250,000
CF_OPERATING (65,000) 30,000 150,000 (20,000)
CF_NETINCOME 50,000
CF_DEPAMORT 50,000 (20,000)
CF_IMPAIRMENT -
CF_GAINLOSSSALE -
From the P&L account:
DEPAMORT_PPEBUILDING
“CF_” + X = CF_DEPAMORT
Cash Flow Account
“CF” + X = CFPPEBUILDING
Custom2 Member
Note: When designing an application, it is important to think how the Balance Sheet, Income Statement,
and Statement of Cash Flows will all fit together!

But How Do We Get To Cash??
BEGINBAL 450,000 100,000 200,000 250,000 300,000 - (300,000) (600,000) (400,000)
CF_OPERATING (65,000) 30,000 150,000 (20,000) (30,000) - (15,000) - (50,000)
CF_NETINCOME 50,000 (50,000)
CF_DEPAMORT 50,000 (20,000) (30,000)
CF_IMPAIRMENT -
CF_GAINLOSSSALE -
CF_AR (30,000) 30,000
CF_AP 15,000 (15,000)
CF_INV (150,000) 150,000
…. (298,000) 50,000 25,000 8,000 200,000 15,000
ENDBAL 87,000$ 130,000 350,000 280,000 295,000 8,000 (315,000) (400,000) (435,000)

3D – C2 Aggregation for Cash Impact
BEGINBAL 450,000 100,000 200,000 250,000 300,000 - (300,000) (600,000) (400,000)
C2 Rollup for BEGINBAL Acct
CFTTL_CASH 450,000
CFAR_BAL 100,000
CFINV_BAL 200,000
CFPPEBUILDING 250,000
CFPPEMACHINE 300,000
CFAFSSEC -
CFAP_BAL (300,000)
CFDEBT (600,000)
CFRE (400,000)
• The impact on cash is calculated
by determining the offset for each
of the other Balance Sheet
categories
• CFTTL_CASH is a parent C2
member for the rest of the
Balance Sheet categories. In the
attributes of each of the C2
members, you can see that the
aggregation weight is set to -1
• This means that when each of the
C2 members rolls up, it passes the
opposite amount up to the
CFTTL_CASH member

3D – Example #1 – Reporting Output
BEGINBAL 450,000 100,000 200,000 250,000 300,000 - (300,000) (600,000) (400,000)
CF_OPERATING (65,000) 30,000 150,000 (20,000) (30,000) - (15,000) - (50,000)
CF_NETINCOME 50,000 (50,000)
CF_DEPAMORT 50,000 (20,000) (30,000)
CF_IMPAIRMENT -
CF_GAINLOSSSALE -
CF_AR (30,000) 30,000
CF_AP 15,000 (15,000)
CF_INV (150,000) 150,000
…. (298,000) 50,000 25,000 8,000 200,000 15,000
ENDBAL 87,000$ 130,000 350,000 280,000 295,000 8,000 (315,000) (400,000) (435,000)

3D – Example #2 – User Defined Field Approach
• Company profile
• Multinational private conglomerate
• Metadata
• Account dimension for balance sheet association
• Custom dimension for GAAP cash flow accounts
• Logic
• Activity is sourced based on the User Defined Field

3D – Example #2 – Report Setup
CF Activity (C1) in the Rows
CFTTL_CASH CFACCTREC CFINVENTORY CFPPEBUILDING CFPPEMACHINE CFAFSSEC CFAP CFDEBT CFRE
CF_OPEN_BALANCE 450,000 100,000 200,000 250,000 300,000 - (300,000) (600,000) (400,000)
CF_OPERATING (65,000) 30,000 150,000 (20,000) (30,000) - (15,000) - (50,000)
CF_NETINCOME 50,000 (50,000)
CF_DEPAMORT 50,000 (20,000) (30,000)
CF_IMPAIRMENT -
CF_GAINLOSSSALE -
CF_ACCTREC (30,000) 30,000
CF_ACCTPAY 15,000 (15,000)
CF_INVENTORY (150,000) 150,000
…. (298,000) 50,000 25,000 8,000 200,000 15,000
Ending Balance 87,000$ 130,000 350,000 280,000 295,000 8,000 (315,000) (400,000) (435,000)
BS groupings (Account) in the columns

• Account dimension – slightly different from the prior example, as this
dimension houses the BS groupings and not the actual GAAP cash flow
accounts

• Custom1 dimension – these are the GAAP cash flow accounts
Look familiar??
UD3 from the CFACCTREC
dimension
The Custom1 members mirror
the UD3 for the accounts, we’ll
discuss more in logic

• Custom3 dimension
• Similar to the other examples, this dimension is used for the data type, which will specify
whether a cash flow value is calculated or input

• Account Member List
• An account member list was created with all of the accounts that were determined to have
in impact on the cash flow statement. This list is comprised of various cash flow balance
sheet groupings and P&L accounts
• The rules loop through this member list and run the cash flow logic for the accounts in the
list.

• Opening Balance:
• The rules loop through each of the balance sheet groupings in the previously defined
account member list, looks at the member after “CF” and determines if the account is an
asset or liability
• If the account is an asset or
liability, the opening balance (C1) is set to the
prioryear last period balance for the account
• The ending balance is calculated the same
way, but uses the current period balance

• To populate the movement for each account, in the same loop that is
determining whether or not the CF accounts in the C1 dimension are asset or
liability, the rules populate the YTD change to the C1 activity member that is
specified in the account UD3
YTD change
in ACCTREC

CF_OPEN_BALANCE 450,000 100,000 200,000 250,000 300,000 - (300,000) (600,000) (400,000)
CF_OPERATING (65,000) 30,000 150,000 (20,000) (30,000) - (15,000) - (50,000)
CF_NETINCOME 50,000 (50,000)
CF_DEPAMORT 50,000 (20,000) (30,000)
CF_IMPAIRMENT -
CF_GAINLOSSSALE -
CF_ACCTREC (30,000) 30,000
CF_ACCTPAY 15,000 (15,000)
CF_INVENTORY (150,000) 150,000
…. (298,000) 50,000 25,000 8,000 200,000 15,000
Ending Balance 87,000$ 130,000 350,000 280,000 295,000 8,000 (315,000) (400,000) (435,000)
3D – Example #2 – BS Change Example
BS groupings (Account) in the columnsCF Activity (C1) in the Rows
The change in the account (in this case, ACCTREC, which
is the account with the first to characters stripped off) is
populated to the CF BS account, and the Custom1
specified in the account UD3

• A similar process is used if the
account being looped through is a
revenue or expense account, but
the UD members have two items in
the UD Field. To the left of the ~ is
the balance sheet grouping
(account) the activity will apply to,
the right of the ~ is the GAAP CF
member (C1) the activity will apply
to:
Balance Sheet
Grouping (Acct)
GAAP CF
Account C1

CF_OPEN_BALANCE 450,000 100,000 200,000 250,000 300,000 - (300,000) (600,000) (400,000)
CF_OPERATING (65,000) 30,000 150,000 (20,000) (30,000) - (15,000) - (50,000)
CF_NETINCOME 50,000 (50,000)
CF_DEPAMORT 50,000 (20,000) (30,000)
CF_IMPAIRMENT -
CF_GAINLOSSSALE -
CF_ACCTREC (30,000) 30,000
CF_ACCTPAY 15,000 (15,000)
CF_INVENTORY (150,000) 150,000
…. (298,000) 50,000 25,000 8,000 200,000 15,000
Ending Balance 87,000$ 130,000 350,000 280,000 295,000 8,000 (315,000) (400,000) (435,000)
3D – Example #2 – P&L Activity Example
BS groupings (Account) in the columnsCF Activity (C1) in the Rows

• An offset is also booked for each total Custom1 GAAP CF account member to
show the impact of all of the related BS/P&L activity on the cash account
• This is accomplished by taking the total of the CASHFLOWBALANCE activity
and booking it to the CFTTL_CASH account with the opposite signage
Flip
Sign

CF_OPEN_BALANCE 450,000 100,000 200,000 250,000 300,000 - (300,000) (600,000) (400,000)
CF_OPERATING (65,000) 30,000 150,000 (20,000) (30,000) - (15,000) - (50,000)
CF_NETINCOME 50,000 (50,000)
CF_DEPAMORT 50,000 (20,000) (30,000)
CF_IMPAIRMENT -
CF_GAINLOSSSALE -
CF_ACCTREC (30,000) 30,000
CF_ACCTPAY 15,000 (15,000)
CF_INVENTORY (150,000) 150,000
…. (298,000) 50,000 25,000 8,000 200,000 15,000
Ending Balance 87,000$ 130,000 350,000 280,000 295,000 8,000 (315,000) (400,000) (435,000)
3D – Example #2 – Cash Impact Offset
BS groupings (Account) in the columns
CF Activity (C1) in the Rows

2D vs. 3D – Compare and
Contrast

2D vs. 3D – Compare and Contrast
Characteristic 2D 3D
Provide Roll Forward of Cash Account + +
End-User Analysis - +
Auditability - +
Simplicity + -
Metadata Maintenance + -
Visibility Into Offsetting Noncash Items - +
**The “-” doesn’t indicate that something can’t be done…it just indicates that the other
method may offer more solutions or be a better fit for the approach

Recap
• Cash flow
• Sources and uses of cash – operating, investing, and financing
• 2D vs. 3D:
• 2D – Just the facts: cash flow accounts and input vs. calculated
• 3D – Addition balance sheet detail, additional logic
• Methods to calculate – think about your metadata
• What’s available? How can you set up your dimensionality?
• Activity driven by member names?
• Activity driven by metadata attributes?
• Something else entirely?

Upcoming Webinars
• Friday, August 24– Cash Flow Series, Part 2: How
to make HFM do the dirty work
• Presented by Matt Spencer

Thank you for Attending!
Today’s Presenter:
Matt Spencer
mspencer@finit.com
Greg Barrett
gbarrett@finit.com
Copy of the slides or Recording:
Email us for a copy of the slides or a
link to the recording
insights@finit.com
Past webinars:
www.finit.com/webinars
Follow us on Twitter for updates:
@Finit_Solutions

Cash Flow Series, Part I: 2-dimensional vs 3-dimensional

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Similar to Cash Flow Series, Part I: 2-dimensional vs 3-dimensional

Similar to Cash Flow Series, Part I: 2-dimensional vs 3-dimensional (20)

More from finitsolutions

More from finitsolutions (20)

Recently uploaded

Recently uploaded (20)

Cash Flow Series, Part I: 2-dimensional vs 3-dimensional

Editor's Notes