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Copyright 2002: LIIF
LIIF Fund Processing Workflows
The following document is posted by the Low Income Investment Fund (LIIF) in accordance with the requirements of the Fannie Mae Foundation’s October 2001 grant in support of LIIF’s continued information technology (IT) development. Materials posted by LIIF outline the organization’s strategic IT plan, as well as document the implementation process of this plan. LIIF’s IT plan included customization of loan servicing software, report automation, impact statistics generation, fund administration, and asset liability monitoring. LIIF’s knowledge and experience developing this IT workplan is posted as an aid to other non-profit Community Development Financial Institutions (CDFIs) who may be generating their own IT workplan and who may find the subsequent materials helpful in that regard.
$ $$
Lending
$$
Development
Finance Administration
Management
Support
Borrower MarketingUnderwritingLoan ApprovalsCommitment/ClosingCollateral TrackingPayment CollectionsProject MonitoringRisk AnalysisStatistics Tracking
FundraisingInvestor RelationsProposal WritingFunder ReportingCovenant Tracking
Cash ManagementG/L AccountingBudget PlanningCompliance
Technical Assistance
Provider OutreachEligibility ScoringGrant ApprovalsMonitoringStatistics Tracking
TA MarketingConsulting/TrainingContract AdministrationStatistics Tracking
Contact ManagementOffice ManagementHuman ResourcesAdministrative Support
Information Technology
System AdministrationSoftware DevelopmentUser Training
Management
Business PlanningOrganization StructureWorkflow Control
LIHF CORE BUSINESS FUNCTIONS
Program Activities Funding
$ $$
Grant Making
Copyright 2002: LIIF
$ $$
Lending
$$
Development
Finance
$ $$
Grant Making
Technical Assistance
Contact Management
Administration
Program Operations
Lending Operations
Project Statistics
General Ledger
Capital Allocation
Funding Operations
TARGET APPLICATION ARCHITECTURE
Nortridge Lending System
Custom Application
Application Key
MIP General Ledger
Copyright 2002: LIIF
Copyright 2002: LIIF
Narratives & Statistics
FundingOperations
ProgramOperations
(Active & History)
Funding
RLF Loans & Packages
Clients, Funders, Vendors, Other Contacts
Investor Loans & Grants
Program Grants & TA
ProjectData
(Active & History)
CapitalAllocation
Client-Funder Operation Matching
LendingOperations
(Active & History)
Replication: Records copied to one or more separate databases; changes permitted only in database of origin.
Linking: Single copy of records held in one database with references to records stored in one or more separate databases.
Export: Summary transaction information exported to external file and detail records marked as closed.
DATABASE INTEGRATION ARCHITECTURE
Programs
ContactManagement
Strategies to manage data redundancy:
G/L Interface
G/L Interface
G/L Interface
Copyright 2002: LIIF
Funder Operations Client Operations
FUNDER – CLIENT OPERATIONS INTERFACE
ProjectsFunders
RLFGrants & Loans
ProgramGrants
Loans
Grants
FundingPools
Capital Allocation
Operations matched
dynamically by restrictions
Operations assigned
manually by staff
Copyright 2002: LIIF
$
Funder
Management
$$
Development $
Funder
$$
Development $
Funder
Finance
3. Development writes formal proposal for capital or administrative funding
4. Funder approves proposal and sends Loan/Grant Agreement
1. Management oversees investor relations and prospects funding opportunities
5. Development returns signed agreement and sends thank you letter
Funding Operations Overview
Fundraising
6. Funder sends cash payments and executed documents
2. Funder indicates commitment level, funding terms and budget constraints
Copyright 2002: LIIF
Finance
1. Finance enters loan and grant operations from executed documents NLS
FundingOperations
2. System generates principal advances and interest accruals
3. Finance enters payments and restriction release transactions
4. G/L Interface process summarizes detail transactions
5. G/L Interface process creates journal entry batch file
NLS/MIPGeneral Ledger
Interface
6. Finance imports journals into MIP and posts to G/L accounts
MIPG/L
JE File
Funding Operations Overview
Funder Accounting
NLSFunding
OperationsFinance
Copyright 2002: LIIF
$$
Development
$
Funder
2. Development gathers consolidated organizational data
1. System generates notice of pending Funder Report
LIHF Data Sources
3. Development builds report based on funder requirements
5. Development logs report submission in database
Funding Operations Overview
Funder Reporting
..
$$
Development4. Development transmits completed report to Funder
NLSFunding
Ops.
NLSFunding
Ops.
Copyright 2002: LIIF
$$
Development
$
Funder
1. Management provides qualified funding opportunityorSystem generates notice of loan maturity or grant renewal
3. Development gathers data and writes proposal
4. Development sends proposal to Funder
5. Funder returns proposal acceptance
NLSFunding
Operations
Management
Status: PROSPECT Status: PROPOSAL Status: APPROVED
Fundraising Work Flow
1 – Proposal Submission
Proposal Folder
2. Development reviews funding history and opens new proposal folder
Proposal Proposal√
Copyright 2002: LIIF
$$
Development
$
Funder
1. Funder sends Loan / Grant Agreement
Fundraising Work Flow
2 – Operation Closing
$
Funder2. Development returns signed documents and sends thank you letter
NLSFunding
Ops.
3. Development saves important documents
Finance
4. Funder sends cash payments and executed documents
5. Finance creates loan/grant operation and records fund use restrictions and reporting cycle
Status: EXECUTEDProposal Folder
Proposal√ $
MICROSOFT CORPORATION
Agreement
ReportForm
Correspondence
1. Geographic Area2. Purpose3. Sector4. Target Population5. Time Period
Restrictions
Copyright 2002: LIIF
Funder Accounting – Cash Processing
Receipts and Disbursements
Finance
Finance records cash deposit/funds transfer
Debit Account$999,999 01-1080 or 01-1065
Bank Account (RLF/CCFF)
Credit Account<$999,999> 01-XXXX
Funder Cash Clearing
G/L Transactions
Pay to $
System generates G/L transactions
MIP Accounting System
A/P Module
G/L Module Finance
Finance enters funder billing/scheduled payment
Pay to $
Cash from Funder Cash to Funder
Debit Account$999,999 01-XXXX
Funder Cash Clearing
Credit Account<$999,999> 01-1010
Concentration Account
G/L Transactions
Copyright 2002: LIIF
Funder Accounting – RLF Loans
1 – New Loan Setup
Finance
Funding Operations Database
Funder Bank of AmericaLoan Number 12345Loan Amount $500,000Interest Rate 4%Maturity Date 02/10/05Current Principal $500,000Current Interest $0Geographic Area SF Bay AreaReporting Cycle Semi-Annual
FunderFinance enters loan operation from executed loan agreement
Loan Record
Transactions
Loans
Debit Account$500,000 01-XXXX
Funder Cash Clearing
Credit Account<$500,000> 03-2210
Notes Payable
G/L Transactions
Funder Loan Agreement
$
MICROSOFT CORPORATION
System creates Loan Record, generates principal advance transaction, and updates loan balances
Status: ACTIVE
Copyright 2002: LIIF
Funder Accounting – RLF Loans
2 – Interest Accruals
Funding Operations Database
Funder Bank of AmericaLoan Number 12345Loan Amount $500,000Interest Rate 4%Maturity Date 02/10/05Current Principal $500,000Current Interest $1650Geographic Area SF Bay AreaReporting Cycle Semi-Annual
Funder
Loan Record
Transactions
Loans
Debit Account$1,650 01-5370-30-XX-XX
Interest Expense
Credit Account<$1,650> 01-2050
Interest on Notes Payable
G/L Transactions
System generates daily interest accrual transactions
Copyright 2002: LIIF
Funder Accounting – RLF Loans
3 – Payment to Funder
Finance
Funding Operations Database
Funder Bank of AmericaLoan Number 12345Loan Amount $500,000Interest Rate 4%Maturity Date 02/10/05Current Principal $499,650Current Interest $0Geographic Area SF Bay AreaReporting Cycle Semi-Annual
Funder
Finance posts payment to funder loan
Loan Record
Transactions
Loans
Debit Account$350 03-2210
Notes Payable$1,650 01-2050
Interest on Notes PayableCredit Account<$2,000> 01-XXXX
Funder Cash Clearing
G/L Transactions
System records payment and updates loan balances: principal (amortizing loans) and interest
Pay to $
Check to Funder (from A/P module)
Copyright 2002: LIIF
Funder Accounting – RLF Loans
4 – Loan Payoff
Finance
Funding Operations Database
Funder Bank of AmericaLoan Number 12345Loan Amount $500,000Interest Rate 4%Maturity Date 02/10/05Current Principal $0Current Interest $0Geographic Area SF Bay AreaReporting Cycle Semi-Annual
Funder
Finance posts final payment to funder loan
and changes status to REPAID
Loan Record
Transactions
Loans
Debit Account$100,000 03-2210
Notes Payable$1,650 01-2050
Interest on Notes PayableCredit Account<$101,650> 01-XXXX
Funder Cash Clearing
G/L Transactions
System records payment, updates principal and interest balances, and sets payoff date to current system date.
Pay to $
Check to Funder (from A/P module)
Status: REPAID
Copyright 2002: LIIF
Funder Accounting - RLF Grants
1 – New Grant Setup
Finance
Funding Operations Database
Funder Dominican SistersGrant Number 12345Grant Amount $350,000Current Amount $350,000Origination Date 09/10/00Expiration Date 09/10/02
Target Population HomelessReporting Cycle Annual
FunderFinance enters grant operation from executed grant agreement
Grant Record
Transactions
Grants
Debit Account$350,000 01-XXXX
Funder Cash Clearing
Credit Account<$350,000> 03-4120-30-XX-XX
Contributions RLF
G/L Transactions
Funder Grant Agreement
$
MICROSOFT CORPORATION
Status: ACTIVE
System creates Grant Record, generates transaction for initial amount, and updates grant balances
Copyright 2002: LIIF
Funder Accounting - RLF Grants
2 – Grant Expiration
Finance
Funding Operations Database
Funder Dominican SistersGrant Number 12345Grant Amount $350,000Current Amount $350,000Origination Date 09/10/00Expiration Date 09/10/02
Target Population HomelessReporting Cycle Annual
Funder
Finance changes grant status to SATISFIED at end of effective period
Grant Record
Transactions
Grants
Status:SATISFIED
Copyright 2002: LIIF
Funder Accounting - Program Grants
1 – New Grant Setup
Finance
Funding Operations Database
Funder M&P Haas FundGrant Number 12345Grant Amount $100,000Current Amount $100,000Origination Date 03/15/02Expiration Date 03/15/04
Use Restrictions PredevelopmentReporting Cycle Quarterly
FunderFinance enters grant operation from executed grant agreement
Grant Record
Transactions
Grants
Debit Account$100,000 01-XXXX
Funder Cash Clearing
Credit Account<$100,000> 04-4110-50-XX-04
Contributions CCFF
G/L Transactions
Funder Grant Agreement
$
MICROSOFT CORPORATION
Status: ACTIVE
System creates Grant Record, generates transaction for initial amount, and updates grant balances
Copyright 2002: LIIF
Funder Accounting - Program Grants
2 – Recipient Grant Execution
Program Operations Database
RecipientChild Care enters grant operation from executed grant agreement
Grant
$ $$
Child Care
Recipient Wu Yee Child ServicesGrant Number 56789Grant Amount $25,000Current Amount $0Origination Date 04/15/02Expiration Date 04/15/05
Other Operational Information
Grant Record
Transactions
$
MICROSOFT CORPORATION
CCFF Grant Agreement
Copyright 2002: LIIF
Funder Accounting - Program Grants
3 – Recipient Grant Allocation
$ $$
Child Care
Child Care allocates recipient grant disbursements to funding sources
CCFF Program
Grant Allocator
Finance
CheckRequest$25,000
System generates Check Request Form
Program Operations Database
Funding Operations Database
Grant Recipient Amount56789 Wu Yee Child $25,000Grant Funder Amount12345 M&P Haas $15,00099999 CCSF1-1 FY99 $10,000
System generates memo "payable" transactions to PO and FO databases (no G/L interface)
Recipient Wu Yee Child ServicesGrant Number 56789Grant Amount $25,000Current Amount $0Origination Date 04/15/02Expiration Date 04/15/05
Pending Draw $25,000
Grant RecordFunder M&P Haas FundGrant Number 12345Grant Amount $100,000Current Amount $100,000Origination Date 03/15/02Expiration Date 03/15/04
Pending Release $15,000
Grant Record
Copyright 2002: LIIF
Funder Accounting - Program Grants
4 – Recipient Check Generation
Finance
MIP Accounting System
Finance enters check request into MIP A/P module
Debit Account$25,000 01-XXXX
Funder Cash Clearing
Credit Account<$25,000> 01-1010
Bank Account
G/L Transactions
System generates recipient check
Pay to $
$ $$
Child Care
CheckRequest$25,000
A/P Module
G/L Module
System generates G/L transactions
Copyright 2002: LIIF
Funder City of SFGrant Number 12345Grant Amount $100,000Current Amount $85,000Origination Date 03/15/02Expiration Date 03/15/04
Pending Release
Grant Record
Funder M&P Haas FundGrant Number 12345Grant Amount $100,000Current Amount $85,000Origination Date 03/15/02Expiration Date 03/15/04
Pending Release $0
Funder Accounting - Program Grants
5 – Grant Restriction Release
Finance
Funding Operations Database
Funder
Grant Record
Transactions
Grants
Debit Account$15,000 04-4999-50-XX-04
Net Assets Released
Credit Account<$15,000> 01-4999-50-XX-04
Net Assets Released
G/L Transactions
System generates funding release G/L transactions
CheckRequest$25,000
Transactions update funder grant balances and clear "payables"
Finance enters grant fund release transactions (against "payable" transactions)
Status: RELEASED
Status: ACTIVE
Copyright 2002: LIIF
Funder Accounting - Program Grants
6 – Recipient Grant Disbursement
Program Operations Database
Recipient
Grant
Recipient Wu Yee Child ServicesGrant Number 56789Grant Amount $25,000Current Amount $25,000Origination Date 04/15/02Expiration Date 04/15/05
Pending Draw $0
Grant Record
Transactions
Finance
CheckRequest$25,000
Finance enters grant disbursement (against "payable" transaction)
Transaction updates recipient grant balance and clears "payable"
Debit Account$25,000 01-5420-50-XX-04
Grant Expense
Credit Account<$25,000> 01-XXXX
Funder Cash Clearing
G/L Transactions
System generates grant disbursement G/L transactions
Copyright 2002: LIIF
Funder Accounting - Administrative Grants
1 – New Grant Setup
Finance
Funding Operations Database
Funder F.B. Heron FoundationGrant Number 12345Grant Amount $200,000Current Amount $100,000Origination Date 12/02/00Expiration Date 12/02/03
Use Restriction LIHF GeneralReporting Cycle Semi-Annual
FunderFinance enters grant operation from executed grant agreement
Grant Record
Transactions
Grants
Debit Account$100,000 01-XXXX
Funder Cash Clearing
Credit Account<$100,000> 02-4100-XX-XX-XX
Contributions
G/L Transactions
Funder Grant Agreement
$
MICROSOFT CORPORATION
Status: ACTIVE
System creates Grant Record, generates transaction for initial amount, and updates grant balances
Copyright 2002: LIIF
Funder F.B. Heron FoundationGrant Number 12345Grant Amount $200,000Current Amount $0Origination Date 12/02/00Expiration Date 12/02/03
Use Restriction LIHF GeneralReporting Cycle Semi-Annual
Funder Accounting - Administrative Grants
2 – Grant Expiration
Finance
Funding Operations Database
Funder
Finance enters "release" transaction and changes grant status to RELEASED at end of effective period
Grant Record
Transactions
Grants
Status: RELEASED
System updates grant balance (no G/L interface)
Proposal
EXECUTED
DEAD
PROPOSALPROSPECT
DENIED
APPROVED
ACTIVE REPAID
RELEASED
SATISFIED
Funding Operation Status Flow
WITHDRAWN
Loan/Grant
Program and Administrative Grants (fully disbursed)
RLF Grants (reporting period passed)
RLF Loans (principal repaid to funder)
Copyright 2002: LIIF
Copyright 2002: LIIF
Funder Administration
Event Notification
Katharine Strunk
• 1/2/02 Funder Report, Grant 12345, Heron Foundation, $123,000.00
• 1/15/02 Next Proposal, Loan 67890, Bank of America, $415,000.00
• 2/1/02 Grant Maturity, Grant 59012, Citibank, $53,000.00
Finance Mail Group
• 2/1/02 Grant Maturity, Grant 59012, Citibank, $53,000.00
Event List for 12/21/01
• Grant/Loan Maturity Date
• Funder Report Date
• Next Proposal Date
Event Dates
1. Nightly batch process scans database and extracts upcoming and past due events
2. Staff can run Excel-based Event Notification Report
3. Selected events will generate tasks in Outlook Task List
Nightly EventNotification
Process
Outlook TasksExcel Reports
Finance
FundingOperations
$$
Development
Copyright 2002: LIIF
Funder Administration
Funder Reporting
NLSFunding
Ops.
NLSLending
Ops.
NLSPrograms
Ops.
Portfolio Indicator Reports
• Monthly Lending Activity• Monthly Program Activity• Borrower Concentration• Portfolio Valuation Analysis• RLF Participants• Program Investors
CapitalAllocation
Projects
Impact Indicator Reports
• Leveraged Status Report• Project Outcome Statistics• Funder Activity Report
MIP
Financial Indicator Reports
• Financial Statement
Development completesFunder Report
$$
Development
LIHF Organizational
Data
Funder Reporting Requirements
Copyright 2002: LIIF
Funder Administration
Funder Report Logging
$$
Development
1. Development sets up reporting schedule in Funding Operations system
Frequency: Semi-AnnualStart Date: 7/01/01Lead Time: 10 Days
Notify Date: 12/21/01Date Due: 01/01/02
Fields entered by user
Fields calculated by system
$$
Development
2. System sends reminder message to Development on Notify Date
$
Funder
3. Development generates report and transmits to Funder
4. Development logs report completion in Funding Operations system
Status: SubmittedDate Sent: 01/01/02
Notify Date: 06/21/02Date Due: 07/01/02
NLSFunding
Operations
NLSFunding
Operations
Fields entered by user
Fields calculated by system