Oracle Advance Controls

The following is intended to outline our general product
direction. It is intended for information purposes only,
and may not be incorporated into any contract.
It is not a commitment to deliver any material, code, or
functionality, and should not be relied upon in making
purchasing decisions. The development, release, and
timing of any features or functionality described for
Oracle’s products remains at the sole discretion of
Oracle.


Fusion GRC Applications
Strategy and Roadmap

Sid Sinha
Senior Director, Product Development
Presenting with


Agenda

 Introductions
 Product Strategy
 Customer Panel Discussion


RISK MANAGE
INTEGRATED BUSINESS PLANNIN

BETTER REPORTING
ATTRACT AND RETAIN TALENT
PRODUCTIVITY

FINANCIAL REPORTIN
RISK MANAGE
DRIVING GROWTH INTEGRATED BUSINESS PLANNIN

REDUCING COSTS
MANAGING RISK
BETTER REPORTINGPAYABLE
ACCOUNTS

ATTRACT AND RETAIN TALENT
PRODUCTIVITY
ACCOUNTS RECEIVABLE
INVESTOR RELATIONS

Financial Impact

“[Most companies] expect
to find .1% of of a
company’s spend in  $1,000,000 lost per year for
financial leakage” every billion in spend
“For a company with a
5% profit margin, $1
 Each Incident of fraud costs
Million in recoveries $100,000 to $1,700,000*
equates to $20 Million in
incremental Sales”
Protiviti 2010 - Procurement Assessment
and AP Recovery Solutions

*Source: 2010 ACFE Report to the Nations on Occupational Fraud and Abuse


Strategic Priorities
Survey of 263 Finance Executives

BETTER CONTROLS AND EFFICIENCIES

Business Risk Analysis 48%
Improve Cash Flow and Working Capital 42%
Audit and Control of Procurement 33%
Understanding Payables Exposure 28%
Compliance 15%

Reaching New Heights: The Dividends of Collaboration between Finance and Procurement is published by CFO Publishing LLC, May 2012


Control Challenges
Survey of 425 companies TOP 10 CONTROL CHALLENGES*
Segregation of Duties
Duplicate Payments
Manual Processes
DRIVERS
Employee Reimbursements
• Lack of Staff
• False Positives Compliance with Policy
• Access to Data
• Visibility to Issues Automation
• Mergers & Acquisition
Checks
• Decentralized Operations
• Outsourcing Approvals

Standardization/Consistency

Signatures/Authority

10 Copyright © 2012, Oracle and/or its affiliates. All rights reserved. Confidential – Oracle Internal *Accounts Payable Network Benchmark: AP Controls May 2011

Web of Control Issues
Missing Prices
Overpayments to Unauthorized
Vendors Credit

Invalid or Missing Credit
Duplicate Checks
Unauthorized Supplier Master
Billing Errors Journal Entries
Unapproved or
Illegal Suppliers
Duplicate
Inaccurate Payments
Inaccurate Manual Journal
Financial Reports Entries
Delayed Supplier
payments
Duplicate
Incorrect Spilt Purchase Invoices
Payment Terms Statutory Audit Orders
Findings

Unused Credit
Supplier Fraud Memos
Unauthorized Delayed
Unusual Returns
Access Collections


Performance Driven Controls

BUSINESS RISKS
ENTERPRISE PERSPECTIVE

Goals Process
Optimization Human Capital
CONTROL OBJECTIVES
Compliance Order Mgmt.

Working Capital Accounting

Leakage Procurement

CONTINUOUS MONITORS


Example – Financial Leakage

PERFORMANCE GOAL PREVENT LEAKAGE $

Unauthorized
BUSINESS RISKS Purchases
Overpayments

Valid Purchase Capture All Accurate Supplier
CONTROL OBJECTIVES Orders Discounts Information

Purchase of Purchase Orders Discounts Lost
Split Purchase
CONTINUOUS MONITORS Orders
Unauthorized to Blocked due to Delayed
Items Suppliers Payments


Integrated Risk and Controls Management
Steps
Assess Risk
Identification and Compliance
BUSINESS RISKS Analysis
Evaluate

Document
Detect and
CONTROL OBJECTIVES Assessments Fix Issues
Reviews

Author
CONTINUOUS MONITORS Execute
Continuous Improvement
Investigate
& Monitoring


Fusion GRC Product Strategy
One Enterprise Foundation

BUSINESS RISKS
Enterprise Risk & Controls Foundation
Dashboards, Reports and Alerts

CONTROL OBJECTIVES Risk, Controls & Compliance Management

Continuous Controls Monitoring

CONTINUOUS MONITORS
Custom or
Legacy
Applications


 All Users
 All Processes
Dashboards, Reports and Alerts
 All Applications
Risk, Controls & Compliance Management

Continuous Controls Monitoring  100% of Transactions (Not Samples)
 Advanced Detection Patterns
 Manage by Exception

Business Application Business Application Business Application  Independent Assurance
Roles and User Security Roles and User Security Roles and User Security
 Strengthens ERP controls
Workflow Controls & Set Up Workflow Controls & Set Up Workflow Controls & Set Up
Masterdata Masterdata Masterdata
 Does not sacrifice efficiency over
Transactions Transactions Transactions control


Enterprise Risk & Controls Foundation • Manage Interdependent Risks,
Dashboards, Reports & Alerts
Compliance and Monitoring
Initiatives
Role Based Access Security

Worklists Notifications Email Search Perspectives

Setup and Administration
• Closed-loop processes for
documentation, assessments,
Documentation Reviews Assessments Surveys Remediation
remediation and testing
Continuous Controls & Risk Monitoring
• Flexible, User-Defined Modules
Access Setups Master Data Transactions Audit Tests
and Control Monitors and
Data Connectors User Authored Controls Fraud & Error Patterns Audit Testing

Custom or Legacy
Applications


Customer Success


Fusion GRC Solutions


Enterprise SOD and Security Controls
Solution Capability
 Document, assess and certify Application Security/SOD policies
 Library of pre-built automated SOD controls for EBS, PSFT & Fusion
 Author new controls, extend to any business application
 Benefits
– Foundation for a strong application control environment
– Lower Cost of Compliance - Financial Reporting & Privacy
– Reduction of Fraud and Misuse
Detection Prevention

Define Access Access Remediation Preventive Compensating
Controls Analysis (Clean-up) Provisioning Policies


Technical Innovation
 Complete User Access Path
 RelateDoe
User: John Access to Actual Transactions
Role: Shipping Clerk

Function: Tracking POs
 Connect to any provisioning engine
 Extend to any authorization model
Role: Shipping Supervisor

Function: Purchase Orders

Form: Receiving

Tab: Review PO
Correlate Events and
Detect Policy Violation Action: Submit PO

Transaction: Order 123
Action: Signature Receipt

Vendor: Acme


New Connectors Pre-built
Extensible
Partner Pre-built

Continuous SOD Controls Monitoring CUSTOMER CARE
& BILLING

Custom or Legacy
Applications


Advanced Financial Controls
Solution Capability
 Conduct risk assessments across all processes
 Comprehensive transaction data coverage
 Author controls and manage Incidents
 Benefits
– Prevent Financial Leakage
– Reduce Error, Waste, Misuse and Fraud
– Improve Cash-Flow


Perform Review and Preventive
Define Controls Transaction Address Transaction
Analysis Incidents Controls

Key Financial Control Issues
434 senior finance executives

 51% make 10 to 30% of all payments too early**
 64% make 10 to 30% of payments too late**
 55% of companies are unable to collect 20 to 40% of total revenue
within contracted payment terms**
 46% of AP departments have not reviewed AP policies for over a year*

*Accounts Payable Network Benchmark: AP Controls May 2011; 425 Companies

** Made to Measure CFOs on finance- and procurement-process improvement, CFO Research, May 2012


Procure to Pay - Example
Optimization Cash Flow Prevent Leakage

Business Risks Controls Objectives Continuous Monitors

Capture all Supplier and Invoices
Split purchase orders
Discounts Created by Same User
Unapproved or Incident !
Illegal Suppliers
Accurate Supplier Discounts Lost due to Multiple Suppliers with Incident !
Information Delays in Payment the similar email domain
Delayed Supplier
payments Incident !
Valid Purchase Multiple Suppliers with Purchase Orders issued
Orders the same Tax ID to Blocked Suppliers Incident !
Unauthorized
Purchases
Ensure Separation Multiple Suppliers with Monitor purchases of Investigate
of Duties in the same Bank Account unauthorized items,
Procurement Number such as contraband
Close


Comprehensive Coverage

6000+ Mapped
Data Fields!


Purchase Receive Issue
Requisition Invoice
Goods/Services Goods/Services Payments

Procure to Pay

32 Copyright © 2012, Oracle and/or its affiliates. All rights reserved.

! Controls Dashboard - ×
Notifications Monitoring
User 2 Submitted Order Cash
Duplicate Invoices
#1016 & 1017
Procure to Pay
Error in Transaction
#1018 Travel & Expense

Potential Risk in
Transaction #1018 Reports
ID Invoices Value Order
Unapproved
Transaction #1019 Inst1 1015 11,548 0
Inst2 1016 14,234 0
Inst3 1017 14,094 0
Inst4 1018 22,124 0


C O M I N G S O O N


Accounts Payable Recovery Audit
Example
Profile
UNINTENTIONAL ERRORS AND LEAKAGE  Global Single Instance (EBS)

Global, Fortune 500 Firm, High-Tech  Centralized Payables Operation
• Over 4 Audit Cycles, consultants found $17.5M in
 Well Staffed
payment errors
 Clean Sox Audit

Audit Recovery Findings
 $17.5M Found
 $8.3M Total Recovery
 $4.8M After Fees
 18 Month Cycle


Recovery Audit Controls
Solution Capability
 Manage Recovery Audit Projects & Claims
 Library of pre-built recovery control monitors
 Author new controls, with advanced anomaly & pattern detection
 Benefits
– Pre-audit preparation, secured access to data
– Expand recoveries
– Address root causes of leakage

Define Recovery Analyze Identify Recover Address Root
Controls Results Incidents Claims Causes


Recovery Audit - Example
Improve Cash flow Recover Leakage

Business Risks Controls Objectives Continuous Monitors

Minimize Identify vendors with debit Same Invoice Number
Uncollected Vendor balances and no Open paid in Different
Delayed Collections Balances Purchase Orders Orgs/Operating Units Incident !
and Uncollectable
Receivables Same charges paid on
Same Invoice Number Incident !
Valid Vendor different Invoice Nos. w/
paid twice
Invoices different Dates
Overpayments to Incident !
Vendors Same Invoice Number Invoice entered and paid
Invoice payments by paid to Multiple entities of to an incorrect/unrelated Incident !
customers with Same Supplier Supplier
correct discounts
Identify Customers Payments Investigate
that have taken Discounts
after the Discount Date Close


Advanced Detection Engine
 Pareto Pattern (80-20 Rule)
– Identify top 20% of Suppliers that send 80% of duplicate invoices by amount value

 Absolute Deviation Pattern
– Identify Invoices for disk drives that are in the top 10% in price deviation from the
average price for disk drives
 Anomaly Detection Pattern
– Identify T&E reports where the hotel per day charges are much higher (normal
distribution) than all the other T&E reports
 Clustering Pattern
– Identify groups of vendors based on uncollected vendor balances


PRGX - Recovery Audit Controls Partner

 Global leader in recovery audit services industry
 $1Billion yearly in recoveries on average, 1600 Employees
 Transaction-intensive industries, Clients in over 30 countries

Recovered $ per year
Airline $700,000 - $1,250,000
Automotive $805,000 - $2,200,000
High Tech $400,000 - $1,100,000
Manufacturing $435,000 - $1,300,000
Transportation $385,000 - $830,000
Source: PRGX recovery audit findings


Deloitte - Recovery Audit Controls Partner

 Global leader in contract compliance services
 Broad range of revenue recovery services across multiple industries
(i.e., average ROI for revenue recovery services is 10 to 1)
 Deep experience in the delivery of supplier and vendor management
services
 Broad range of industry experience in Technology, Consumer
Business, Life Sciences, Energy, Federal Gov.
 Global team of dedicated with personnel with specialized contract
compliance skills


Summary Functional Solutions Vertical Solutions

Enterprise SOD Retail Vendor Rebate
Controls Controls

Advanced Financial Retail Inventory
Controls Controls
Dashboards, Reports and Alerts Recovery Audit Telecom Revenue
Controls Assurance

Supplier Risk Govt. Fraud & Misuse
Management
Continuous Controls Monitoring Management

Oil & Gas Health &
Advanced T&E
Safety Monitoring
Controls
Custom or
Legacy Social Media Tax Revenue
Applications Compliance Controls
Management

Outsourced Process Insurance Claim
SLA Monitoring Controls


Fusion GRC Applications
Summary

Enterprise SOD and Advanced Financial Recovery Audit
Security Controls Controls Controls
Protect sensitive Ensure process Reclaim financial
ERP functions integrity and efficiency leakage

Lower Compliance Costs Prevent & Recover Leakage $$

USER ACCESS INTERNAL SYSTEMS EXTERNAL PRCESSES
Improve Cash Flow Process Optimization


Customer Panel
Discussion


Customer Discussion

Jaime Fox Steinar Modalslid-Meling Dennis Self
Senior Manager, Director, Seadrill CIO, Gilead Sciences
Deloitte


Learn more about Deloitte in the
Governance, Risk, and Compliance Track

Integrating GRC and Identity Management: Minimize
Risk Across Your Organization

Session ID: CON11738

Tuesday, 11:45-12:45

Moscone West, Room 3012

Governance, Risk, and ComplianceTrack Sponsor

46 Copyright © 2012, Oracle and/or its affiliates. All rights reserved. Confidential – Oracle Internal 46

GRC Demo Pods – Moscone West W-089; W-013
Monday & Tuesday, (10AM – 6PM); Wednesday (9:45AM – 4PM)


Learn More About GRC Applications
Monday

Optimize Oracle EBS Procure-to-Pay: Cut Inefficiencies/Fraud with Oracle GRC Apps
 12:15PM InterContinental - Sutter
 CON9401

Optimize Oracle EBS Order-to-Cash Process, Cutting Inefficiencies, Fraud Potential
 3:15PM Westin San Francisco - Stanford
 CON9042

Oracle Governance, Risk, and Compliance Controls Suite for PeopleSoft Applications
 3:15PM Westin San Francisco - Franciscan I
 CON9068


Tuesday

General Session: Oracle Fusion GRC Applications Strategy and Roadmap
 10:15AM Moscone West - 3014
 GEN9385

Advances in Oracle Enterprise Governance, Risk, and Compliance Manager
 1:15PM Palace Hotel - Concert
 CON9389

Exploring Oracle Preventive Controls Governor’s Features - Real-Life Examples
 1:15PM Palace Hotel - Presidio
 CON5843


Wednesday
Case Study: Reducing Upgrade Errors and Effort While Improving Business Performance
 10:15AM Palace Hotel - Presidio
 CON9400

Advances in Continuous Controls Monitoring with Oracle Fusion GRC
 1:15PM Palace Hotel - Twin Peaks North
 CON9387

Oracle Governance, Risk, and Compliance Controls Suite Extensibility: Technical Insight
 3:30PM Palace Hotel - Pacific Heights
 CON9046


Wednesday, Cont’d

Enforcing Access Controls in Oracle Fusion Applications
 3:30PM Moscone West - 2007
 CON9403

Enforce Segregation of Duties with Identity Management GRC Controls
 5:00PM Palace Hotel - Twin Peaks North
 CON9386


Thursday

Leveraging Oracle Fusion GRC Apps for Oracle Fusion Coexistence
 11:15AM Palace Hotel - Twin Peaks North
 CON9428

EBS User Panel: Reducing Upgrade Errors and Effort While Improving Compliance
 12:45PM Palace Hotel - Presidio
 CON9395

PSFT User Panel: Preventing Misuse and Waste While Improving Compliance
 2:15PM Westin San Francisco - Franciscan I
 CON9393


The preceding is intended to outline our general product
direction. It is intended for information purposes only,
and may not be incorporated into any contract.
It is not a commitment to deliver any material, code, or
functionality, and should not be relied upon in making
purchasing decisions. The development, release, and
timing of any features or functionality described for
Oracle’s products remains at the sole discretion of
Oracle.


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