Collections 2010 and Beyond: Preparing Your Agency for the Road Ahead – Part II Financial Management Service U.S. Department of the Treasury June 2010

Collections 2010 and Beyond: Preparing Your Agency forthe Road Ahead – Part II

Financial Management Service U.S. Department of the Treasury

June 2010

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Collections 2010 and Beyond:Preparing Your Agency for the Road Ahead – Part II

Welcome and Webinar Introduction

Carolyn Dunston, Director

Agency Relationship Management Division

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Collections 2010 and Beyond: Preparing Your Agency for the Road Ahead – Part II

Collections and Cash Management Modernization (CCMM)Gregory Till, Director

Modernization Planning Office

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Collections and Cash Management Modernization (CCMM)

• What is CCMM? Collections and Cash Management Modernization (CCMM) is an initiative to simplify and modernize the Financial Management Service’s (FMS’s) and Treasury’s collections and cash management programs

Re-architecting of functions and programs that have accumulated over decades

Refers to collections generally (such as fees, taxes, and other remittances), as opposed to debt collection, disbursements, and Government-Wide Accounting

• Scope– Nearly $3 trillion in annual gross revenue collections– Nearly 400 million annual revenue transactions– Hundreds of Federal Program Agency (FPA) office customers– Over two dozen programs, each comprised of one or more

services or systems – In most instances, the collections programs handle not only the

financial information, but also the program information

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OTC

Check

Phone

Mail

“Bank”

Card

ACH Debit

Internet

CollectionChannels

Settlement Mechanisms

Report Centralize

Wire

Infrastructure: Bank Management, Collateral Management

ACH Credit

Collect

“Notional Diagram”


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• What are CCMM’s objectives? – Simplify the architecture without sacrificing functionality– Centralize and standardize the accounting information provided to

FPAs and other Treasury systems – Promote and expand the use of electronic collection of receipts

• What are the benefits?– Save money– Mitigate risk – Improve services

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• What are the biggest changes?– FMS is re-organizing its collections systems and processes to

streamline processes and eliminate redundant functionality• OTCnet is replacing TGAnet, Paper Check Conversion Over

the Counter (PCC OTC), and paper deposit tickets used with Treasury General Account (TGA) Depositary banks in CA$HLINK II

• The Credit Gateway is replacing the Fedwire Deposit System (FDS) and Remittance Express (REX) programs, as well as electronic lockboxes that receive Fedwires and Automated Clearing House (ACH) credits

• Transaction Reporting System (TRS) is replacing reports that FPAs receive from multiple collection programs and CA$HLINK II

– FMS is changing how it performs reporting to provide FPAs and other Treasury systems with detailed collections information through centralized means and in a standard format

– FMS is changing how it performs reporting to improve the accuracy of information provided to FPAs and meet Government-Wide Accounting requirements

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• Timeline of Changes– Make FPA information available through TRS - Ongoing

through 2012

– Convert OTC deposits to TGAnet or PCC OTC, and eventually to OTCnet - Ongoing through 2012

– Convert FDS and REX transactions to Credit Gateway - Fall 2010

– Convert electronic lockbox Fedwire and ACH credit transactions to Credit Gateway - 2011

– Convert electronic lockbox ACH debit transactions to Pay.gov - Ongoing through 2011

– Transition FPAs from using the Treasury Tax and Loan (TT&L) Plus system for collateral monitoring to the new Treasury Collateral Management System (TCMS) - 2011

– Shut down CA$HLINK II - 2012

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CCMM 2010 and Beyond:Preparing Your Agency for the Road Ahead – Part II


• Division Contacts

– CCMM Website: http://fms.treas.gov/ccmm

– CCMM Email: [email protected]

– Agency Customer Relationship Managers (CRMs):

www.fms.treas.gov/crm/contacts.html

– Director of Modernization Planning Office:

Greg Till 202-874-6935

[email protected]

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OTCnetCorvelli McDaniel, Director

Over the Counter Revenue Collection Division

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OTCnet

• Program/System Overview

- OTC Channel• PCC OTC System• TGAnet System• TGA and International TGA Bank Networks• Federal Reserve TGA Bank Network• Seized Currency Collections• Foreign Check and Foreign Currency/Coins Collections

- Responsible for the collection of all checks, cash, and coins transacted at FPA point of sale locations in the U.S. and around the globe

- OTCnet

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OTCnet

• Relationship to Other Programs/Systems

- OTCnet interface to Settlement Gateways for clearing and settlement of transactions

- OTCnet interface to the TRS

- OTCnet relationship to the Shared Accounting Module (SAM) for the validation of Treasury Account Symbols (TAS) and conversion of FPA accounting codes to TAS

- OTC collections and deposit reporting “the GWA way”

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OTCnet

• Current State/End State Comparison

- Today• An outdated and cumbersome business model for the

Government’s OTC business line (characterized by multiple systems, networks and programs that support OTC revenue collection)

• Multiple touch points customers must access to gather data about OTC collection activity

• Two systems: PCC OTC and TGAnet

- Tomorrow• One OTC Channel service provider• One customer service operation• One system solution for OTC collections and deposit reporting

(i.e., OTCnet)• One TGA bank network

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OTCnet

• Agency Impacts

- Current TGAnet and PCC OTC users must convert to OTCnet from 2011 to 2012.

- TGAnet and PCC OTC systems will be decommissioned in 2011 and 2012 respectively. There are no exceptions to these dates.

- Moratorium on TGAnet and PCC OTC implementations effective October 1, 2010 (FPAs have until September 30, 2010 to convert to the legacy TGAnet and PCC OTC systems).

- OTCnet will accept a Common Government-Wide Accounting Classification (CGAC) compliant Treasury Account Symbol (TAS) or Classification Key (C-Key).

- Current PCC OTC users will be issued new user IDs and passwords for OTCnet; current TGAnet users will retain their current user IDs and passwords for OTCnet.

- Web-based PCC processing (on-line check capture capability).

- Thin client on the desktop (off-line check capture capability).

- New Agency Agreement for OTCnet will need to be signed by an FPA representative.

- Currently deployed check scanners and peripherals will be compatible with OTCnet (no requirement to purchase new scanners).

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OTCnet

• Agency Preparation

- Non-TGAnet FPAs that use CA$HLINK II for deposit reporting must convert to TGAnet or OTCnet as soon as possible, but no later than 2012. There are no exceptions to this date.

- Internet Explorer 7 or Internet Explorer 8 is the browser standard necessary for OTCnet.

- Receive on-line OTCnet training through the new Web-Based Training (WBT) product.

- Old versions of the PCC OTC POS software (e.g., POS 5.2; 5.4; and 5.5) will not be supported by OTCnet. FPAs that elect to use client software must install POS 6.0. Old versions of the POS software will be discontinued at the time of conversion from PCC OTC to OTCnet, or no later than 2012. There will be no exceptions to the discontinuance of old POS software versions.

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OTCnet

• Agency Roadmap/Crosswalk- OTCnet Release 1.0 go live date: November 2010

- OTCnet agency pilot (involving 5-6 FPAs): December 2010 to January 2011

- Conversion of all TGAnet users and supporting TGA banks to OTCnet: February/March 2011

• TGAnet users and supporting TGA banks will be converted all at once using an automated tool

- Conversion of all PCC OTC users to OTCnet: April 2011 to November 2012

• PCC OTC FPAs will be converted to OTCnet through a more conventional process requiring collaboration with FPAs on the timeline and approach for conversion.

• FPAs must work with Citibank to set-up the hierarchy in OTCnet• FPAs must work with the Conversion Coordinator assigned to the

agency to set a date for the conversion• FPAs must be issued new user IDs and passwords

- New agency implementations for OTCnet: Will begin March/April 2011

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OTCnet


– OTCnet Project Manager:

Bonnie Ray 202-874-2138

[email protected]

– OTCnet Business Lead:

Reginald McKinney 202-874-6893 [email protected]

– OTCnet Security Officer:

Hennah Shami 202-874-6651

[email protected]

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Transaction Reporting System (TRS)

Tamara Whitaker, DirectorAccounting and Data Management Division

Christina Cox,

TRS Project Manager

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• Program/System Overview– TRS is an FMS-wide transaction broker, data warehouse, and

reporting solution. TRS will:

• Provide a single touch-point for the exchange of all financial transactions across all collections systems

• Offer a centralized repository containing detailed and summarized records of all revenue collections transactions processed by FMS systems

• Facilitate CCMM

• Support reporting of classification information for the Government-Wide Accounting (GWA) Modernization initiative

• Normalize financial transaction reporting and standardize the availability of financial information across all settlement mechanisms and collections systems

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• Program/System Overview (Software Release Plan)

Calendar Year Target:

Agency Reporting

Iteration 1

Framework

Iteration 2

Iteration 3

Agency XML Agency XML

Q1 2010 Q2 2010 Q3 2010

Iteration 3

Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011

Agency Reporting

Q2 2009 Q3 2009 Q4 2009

We Are Here

Note: Plan dates are current targets as of 6/23/10 and subject to change

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• Program/System Overview (Collections Data Availability Plan)

Note: Plan dates are current targets as of 6/23/10 and subject to change

Q1 2010 Q2 2010 Q3 2010 Q4 2010

TGAnet Fedwire Deposit System PATAX-TIP Card Acquiring Service Credit Gateway EFTPS Pay.gov ECP OTCnet

2011 Calendar Year Target:


Existing

We Are Here

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– TRS interfaces with modernized collection programs:

• To receive summary-level voucher information, including Treasury

Account Symbol (TAS) and Business Event Type Code (BETC) or

Classification Key (C-Key)

• To receive collections details

– TRS will facilitate a new, simplified GWA accounting

process:

• Reports the TAS/BETC or C-Key for collections daily

• Allows FPAs to use the Partial 224 and to become GWA reporters

• Allows FPAs to use the GWA Account Statement

• Helps eliminate the two-step classification process (Statement of

Transactions and Statement of Differences) and use of GOALS II

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Transaction Reporting System (TRS) / CA$HLINK II

• Current State/End State Comparisons

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Collections 2010 and Beyond:Preparing Your Agency for the Road Ahead = Part II


• Current State/End State Comparisons

Z

Collection Agent

Collection Agent

Collection Agent

Collection Agent

Federal Agency

Federal Agency

Federal Agency

Federal Agency

$

FMS

Collection Agent

Detail & Summary Records of

Collections Transactions

Detail & Summary Records of

Collections Transactions

TRS

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• Agency Impacts

PhaseTime

Frame

Impact to Existing

ProcessesDetails

ShortTerm

From point of enrollment to

September 13, 2010

None

• Granted access to TRS, but continue to use CA$HLINK II and other collection sources for day-to-day operations

• Opportunity to compare TRS and CA$HLINK II functionality and provide feedback

• Ample time for users to acclimate to TRS

Medium Term

September 13, 2010

Minimal to Moderate

• Utilize TRS to access same-day Fedwires and Pre-settled ACH

• There are no other required process changes

LongTerm

1-4 yearsMinimal to Significant

• CA$HLINK II is decommissioned (2012)• TRS is the primary system for Federal

collections reporting • Direct data feeds from collection

channels may be turned off

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– Visit the TRS website (http://fms.treas.gov/trs/index.html) and utilize a comprehensive set of resources.

• Overview information about TRS• Information about preparing for TRS and enrollment• Time frames for data availability in TRS• “An Introduction to the Transaction Reporting System” webinar• And much more

– Arrange for someone from your FPA to attend an “Introduction to TRS” session to assist in planning for migration to the new system

• Learn about TRS • See a TRS demonstration and sample reports• Gain an understanding of the agency enrollment process

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Collections 2010 and Beyond:Preparing Your Agency for the Road Ahead-Part II


• Agency Roadmap/Crosswalk - Waves of Enrollment

• Data available in TRS

• High need for real-time, same-day Fedwire messages

• High need for pre-settled ACH items


• Initial TRS Pilots

• FPAs which have requested to enroll in TRS

• Active in TRS feedback activities

• Attended “Intro to TRS” session

• FPAs with all collections reported through TRS


• Remaining FPAs

Wave 1now - 9/13/2010

Wave 2CY Q3 2010 - Q3 2011

Wave 3CY Q2 2011 - 2011

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• Agency Roadmap/Crosswalk - Steps in Agency Enrollment– Enrollment is initiated

• Target FPA identified• TRS Team contacts FPA to confirm:

– Appropriate timing for FPA to enroll – A member of FPA transition team attended an “Introduction to TRS”

session

– TRS Team sends TRS Enrollment Initiation Questionnaire for FPA to complete

– Agency transition team reviews TRS informational website– TRS Team conducts kick-off meeting to discuss security

access and enrollment configuration necessary in TRS for FPA’s users

– TRS Team prepares TRS Enrollment Configuration Summary to document access group and user profile information

– Upon Agency and FMS approval, TRS Team creates access group and user profiles in TRS

– Congratulations on completing TRS enrollment– Users may access TRS and web-based training

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– TRS Website: http://fms.treas.gov/trs

– TRS Agency Outreach Team

301-699-6814 [email protected]

– Transaction Reporting System - Deputy Project Manager

Monica Shelton 202-874-1346

[email protected]

– CA$HLINK II- Program Manager Julie Davis 202-874-6714

[email protected]

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Government-Wide Accounting Modernization Program (GWAMP)Collections

Michael Norman, Director Agency Liaison and Security Staff

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Government-Wide Accounting – Collections

• Program System Overview

- The GWAMP is a multi-year initiative to modernize the Federal government’s central accounting and reporting system. The overall vision of the GWAMP is to transform the current archaic government central accounting processes into real-time, event-driven processes to enable better government financial management.

• Provide FPAs with effective financial reporting and reconciliation processes to facilitate responsible Federal financial management

• Eliminate the current redundant reporting processes

• Provide FPAs with standardized processes and data elements to manage their fund balance with Treasury (FBWT)

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– All collections channels are affected by the GWA modernization efforts

– However, the GWA System will only interface with TRS

– Therefore, it’s critically important that FPAs transition to the end-state collection channel applications and to connect those applications to TRS

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• “As-Is State”

– A redundant process that requires FPAs to classify transactions internally and then at the end of each month report these classified transactions to Treasury (Redundant reporting and time-consuming reconciliations)

– Constant Statement of Differences for FPAs as out of balance conditions exist

• “To-Be State”

– A streamlined process that will simplify classifying, reconciling, and reporting of financial and accounting transactions and will result in improved data integrity, increased efficiencies, and reduced costs at the FPAs

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• Agency Impacts

– Transitioning collections data to TRS will allow FPAs to transition to GWA reporting

– Transition from current Treasury Account Symbol (TAS) string format to the Common Government-Wide Accounting Classification (CGAC) component TAS structure

– Each collection transaction will need to be classified when received

– Training will be provided as GWA implements new processes to support the new reporting

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- Perform changes needed to convert to new collections systems

- Modify your accounting systems to provide and accept TAS/BETC on collection transactions (as well as Intra-governmental and Collection [IPAC] and payments, when applicable)

- Work with the Shared Accounting Module (SAM) implementation team to set up cash flow profiles (TAS/BETC) and default classification rules

- Contact FMS to become a GWA Reporter

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• Agency Roadmap/Crosswalk– FPA transitions to the end-state collection channel applications that will provide data to

TRS– SAM works with FPA to confirm that cash flow profiles (TAS/BETC) and default rules are

current and accurate– GWA works with FPA during pilot phase to analyze parallel data comparison of TAS/BETC

classifications– Once in live production mode, TAS/BETC classification data will be presented on the GWA

Account Statement (AS) for review and reconciliation of FPA’s FBWT– FPA reviews AS for any necessary reclassification

20132011/2012

2010 October 1

, 2014

FMS Applications building out to CGAC component TAS/BETC or C-keys• Some accept both current string TAS and new CGAC component format• Others accept only new CGAC format

Agencies transition to CGAC Component TAS format

FMS only acceptsCGAC

Component TAS/BETC or

C-keysAgencies transition to TRS, then transition as GWA pilot, and finally go live as GWA Reporter with TAS BETC classification of collection transactions

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– GWA Website: http://fms.treas.gov/gwa

– Director, Agency Liaison and Security Staff

Michael Norman 202-874-8788

– Agency Liaison

Luz Davila Lopez 202-874-8599


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Credit GatewayBill Brushwood, Director

Settlement Services Division

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- The Credit Gateway is a service operated by FMS’s Financial Agent, which processes incoming Fedwires and ACH credit payments.

- It will replace the FDS and REX systems and will function separately from all collection channels and interface directly with the Federal Reserve.

- Settlement of funds will occur in Treasury accounts with the Federal Reserve.

- Fedwire and ACH credit transaction details received by the Credit Gateway will be transmitted near real-time to the Transaction Reporting System (TRS).

- The Credit Gateway will transmit deposit ticket information to TRS at the end of each business day.

Credit Gateway

• Program/System Overview

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Credit Gateway


- Inputs• Federal Reserve Fedwire Funds Service• Federal Reserve ACH Operations• Commercial Banks (FPA customer’s financial institutions)

- Outputs• TRS – transaction details & deposit information• TIP (Treasury Investment Program) investment information• FMS collection channels – transaction information

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Credit Gateway

• Current State/End State Comparison

Current State• Account setups managed by a commercial bank and various Federal Finance divisions

• Funds settlement through Treasury accounts at the Federal Reserve

• Single Agency Location Code (ALC) account supported for Fedwires

• Multiple cash flow accounts supported for ACH credits

• Manual return of invalid payments

End State• Centralized account setups initiated through Federal Finance Settlement Services Division

• Funds settlement through Treasury accounts at the Federal Reserve

• Multiple ALC “cash flow” accounts supported for Fedwires

• Multiple cash flow accounts supported for ACH credits

• Automated return of invalid payments

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Credit Gateway

• Agency Impacts – Fedwires

• No changes to existing customer wire instructions are required.

• An enhanced 12 digit account number will enable more granular cash flow reporting for FPAs.

• New account setups, transaction reversals, and deposit corrections will be initiated through the Settlement Services Division beginning September 13, 2010.

• Beginning September 13, 2010, no ALC corrections for transactions that occurred in FDS will be permitted. An FPA’s only alternative is to request a reclassification through GWA.

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Credit Gateway

• Agency Impacts

– ACH• No changes to customer ACH instructions required

• Existing ACH REX account Ids will automatically migrate to the Credit Gateway on September 13, 2010.

• An enhanced 12 digit account number will be available on September 13, 2010 for FPAs that want to segregate their ACH credits at a cash flow level. This is similar to the cash flow account level used with REX today.

• After August 1, 2010 no new REX account IDs setups will be permitted. This is necessary to migrate existing REX IDs for the September 13, 2010 implementation of the Credit Gateway.

• New account setups, transaction reversals, and deposit corrections will be initiated through the Settlement Services Division beginning September 13, 2010.

• Beginning September 13, 2010, no ALC corrections for transactions that occurred in REX will be permitted. An FPA’s only alternative is to request a reclassification through GWA.

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Credit Gateway


- If your FPA presently views current day Fedwire transaction details, or future dated ACH transaction details, you will need to enroll with TRS before September 13, 2010. Contact the TRS Agency Outreach team 301-699-6814 or email [email protected].

- Reconcile ALC accounts prior to the September 13, 2010 Credit Gateway “go live” date and make all necessary corrections in CA$HLINK II by September 10, 2010.

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Credit Gateway

• Agency Roadmap/Crosswalk

Summer 2010

August 2, 2010

Aug./Sept. 2010

September 13, 2010

Enroll in TRS

No new REX ID setups

Reconcile ALC accounts

Gateway “go live” View intra-day payments in TRS View prior day payments in TRS or CA$HLINK IIView deposits in TRS or CA$HLINK II

Contact Settlement Services for new account setups, transaction reversals, and corrections

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Credit Gateway


– Settlement Services Mailbox:

[email protected]

– Credit Gateway Program Manager:

Randolph Maxwell 202-874-3720

[email protected]

– Settlement Services Division Director:

Bill Brushwood 202-874-1251

[email protected]

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CONCLUSIONCarolyn Dunston, Director

Agency Relationship Management Division

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COLLECTIONS AND CASH MANAGEMENT MODERNIZATION

Legacy Collection System

CCMM System Conversion Period

Fedwire Deposit System

Credit Gateway Fall 2010

Remittance Express Credit Gateway Fall 2010

Electronic Lockboxes – ACH

Debits

Pay.gov Ongoing thru 2011

Electronic Lockboxes –

Fedwire and ACH Credits

Credit Gateway 2011

Over-the-counter processes and

systems, including TGAnet and PCC-

OTC

OTCnet Ongoing thru 2012

TT&L PlusTreasury

Collateral Management and

Monitoring System

2011

CA$HLINK IIDecommission

Transaction Reporting

System (TRS)

2012

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Collections and Cash Management Modernization

• Changes/Agency Impacts–CCMM• Collection systems and processes are being reorganized to streamline processes and eliminate redundant functionality

• New and improved reporting functionality– Provides detailed collections information through a centralized means and in a standardized XML format– Improves the accuracy of information provided to FPAs and meets GWA requirements

-OTCnet• Current (and future) TGAnet and PCC OTC users must convert to OTCnet. TGAnet and PCC OTC will be decommissioned in 2011 and 2012 respectively. New passwords and IDs for current OTC users will be issued; passwords and IDs for current TGAnet users will remain the same.

-TRS• Will replace the deposit reporting function of CA$HLINK II to accept transaction and deposit reports from FMS from a new, single touch-point.

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• Changes/Agency Impacts (Cont’d)– GWA• Work with FMS to determine the TAS/BETCs (or C-Keys) that FMS

should capture when processing revenue collections

– Collections Architecture• Some program functionality is being moved into new systems such

OTCnet and the Credit Gateway

• Increase the use of electronic funds transfers for collections

• Recognize that the re-architecting of existing functionality likely will slow down development of new functionality

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• Next StepsDetermine all FMS collection systems/mechanisms used by your FPA.

• CCMM Attend/participate in CCMM briefings, conferences Webinars, etc. to

understand the benefits and impacts to your FPA.

• OTCnetNon-TGAnet FPAs using CA$HLINK II for deposit reporting must convert to TGAnet or OTCnet as soon as possible. Current check scanners and peripherals will be compatible (no need to purchase new scanners). On-line OTCnet training available through the new WBT product.

• TRS Utilize educational resources which include agency forums,

WBT/demonstrations, sample reports and the enrollment process.

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• Next Steps

– GWAReview agency specific reporting procedures for collections; modify accounting systems to provide and accept TAS/BETCs; establish cash flow profiles with SAM Team; become a GWA Reporter.

– Credit Gateway Fedwires

• Enroll with TRS if you view Fedwire transaction details for current day payments.

• FDS/CA$HLINK II deposit reporting ALC corrections will cease after 9/10/2010.

ACH • Reconcile ALC accounts prior to 9/13/2010. • Make all necessary corrections in CA$HLINK II by 9/10/2010.• Enroll with TRS if you view future dated ACH.

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ACRONYMS

ACH ALC

Automated Clearing HouseAgency Location Code

CCMM Collections and Cash Management Modernization

CGAC Common Government-Wide Accounting Classification

C-Key Classification Keys

ECP Electronic Check Processing

EFTPS Electronic Federal Tax Payment System

FBWT Fund Balance with Treasury

FDS Fedwire Deposit System

FMS Financial Management Service

FPA Federal Program Agency

FRB Federal Reserve Bank

GOALS II Government On-line Accounting Link System

GWA Government-Wide Accounting

GWAMP Government-Wide Accounting Modernization Program

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ACRONYMS (cont’d)

IPAC Intra-Governmental Payment and Collection

ITGA International Treasury General Account (Depositary)

OTC Over The Counter

OTCnet Over The Counter Network

PATAX Paper Tax System

PCC OTC Paper Check Conversion Over The Counter

POS Point of Sale

REX Remittance Express

SAM Shared Accounting Module

TAS/BETC Treasury Account Symbol/Business Event Type Code

TCMS Treasury Cash Management System

TGA Treasury General Account Depositary

TGAnet Treasury General Account Deposit Reporting Network

TIP Treasury Investment Program

TRS Transaction Reporting System

TT&L Treasury Tax & Loan (accounts)

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Questions?

For additional information visit www.fms.treas.gov/ccmm or

email [email protected].

Documents

Collections 2010 and Beyond: Preparing Your Agency for the Road Ahead – Part II Financial Management Service U.S. Department of the Treasury June 2010