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One Property Management Framework

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Sulejman Halilagic

on 22 January 2015

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Transcript of One Property Management Framework

Non-expendable property: =>1,500USD, 5 years ser.life
Special items: Attractive nature, easily removable =>500, 3 years or more
Group inventory items (furniture, modular workstations, 3 years or more)

Expendable property: at the discretion of head of office or department

ST/AI/2003/5 (HQ & OAHs)
One Property Management Framework
The material master catalogue contains information on all the materials that United Nation procures or produces, stores, and sells.

Some of the benefits of Material Master Catalogue are:
• Classification of data centrally defined and managed.
• Standardize material data through the entire life cycle process (No double entry of data required, Consistency and integrity of data)
• Serialization requirements and Expectancy life centrally managed.

PMU role within Material Master Data governance is to:
Establish "serialisation" criteria common for the entire Secretariat
Ensure that data consistency and integrity is maintained by reviewing/approving or rejecting requests for creation of new records or changes to existing ones.

Upgrade technology, tools and practices leaving behind multiple and fragmented legacy systems such as Procure Plus, Mercury, SUN, IMIS and so on)
Comply with international industry standards such as IPSAS (International Public Sector Accounting Standards).
Unify multiple systems to streamline processes and enable improved productivity (finance and budget management, human resources management, supply-chain management, central support services, and other core functions)

Material Master Data

 Material group: Power Generation (26130000)
 Material type: Fixed asset (ZAST)
 Serialization flag: Yes
 Material number: 2100001164
 Noun: Generating Set
 Gene. Ledger code: 77175010
 Description: Diesel, 250KW, 230V, AC, 1Ph, 50Hz

• Demand planning
• Procurement
• Invoice matching
• Warehousing and distribution
• Plant maintenance
• Asset accounting
• Project planning and implementation
• Sale and transfer of property
• Write-off and disposal
• Financial and business reporting
Global material definition will be shared by all the UN Secretariat entities

Example (to provide visual presentation of what is Material Master):

Material Master Governance structure:
Material and Service Master Request Process Flow

Material Master contains app. 60,000 records.
App. 9900 qualify for potential serialization.

reviewed the 9900 records
and set serialization criteria for 9,535 lines

96.3% records are ready
Only 365 Material Master records are to be further analyzed

Discussions are on-going.
The Property Management Working Group (PMU DM, PMU DFS, Controller Office, HPSB Office, IPSAS Team) is evaluating the proposals and assessing possible risks

Harmonize the Delegation of Authority from ASG/OCSS to Officials
Proposals under discussion
Increase the authority of entities by increasing the threshold and creating additional layers of authority.

Establish Fact finding panel to determine whether full investigation is required or not.

Allow operational decision to be made locally.
Framework for the management of Capitalized Assets
PMU is recruiting a Fixed Asset Accountant Consultant to assist with the development of:
• Policies to ensure the proper recording and management of fixed assets across the Organization
• A fixed asset accounting manual detailing guidelines and processes for the recording and management of fixed assets across the Organisation.
• A training program and associated materials for the certification of fixed asset management officers within the Organisation

Secretariat Scope
The United Nations Secretariat (43,000 staff members):

Headquarters (New York)
– 5 offices and 8 departments
Department of Field Support (DFS)
DPKO Mandated Missions (15),
DPA Department of Political Affairs Mandated Missions (13),
DFS Mandated Missions (UNSOA) as well as United Nation Logistic Base (UNLB) - deployed on four continents (DFS, 2011)
UN Offices Away From Headquarters (Geneva, Nairobi and Vienna)
UN Regional Commissions (Bangkok, Beirut, Addis Ababa, Geneva, Santiago)
International Criminal Tribunals ICTR (Arusha) and ICTY (Hague)

Establish One Property Management Framework through the Governance structure (PMWGS): common Policy, Processes, Roles, Responsibilities, and control mechanism in managing property across the organization.
Complexity: entities have different processes, systems, requirements, operational needs and geographical locations.

One Property Management Framework
to support IPSAS and Umoja

ST/AI on Property Management

Non-expendable property: =>1,500USD, 5 years ser.life
Special items: attractive nature =>500

Expendable property: at the discretion of head of office or department

Delegation of Authority for Property Management


Example of changes in FRRs
ST/AI/2004/1 - Delegation of authority under the FRRs of the UN

ST/AI amended and in the process to be promulgated.
Main Differences:

Standardize the Delegation of Authorities across the Secretariat
Include new financial requirements
Streamline the processes

Property Management Delegation of Authority
from ASG/OCSS to Officials
Establishment of Real Estate framework
Fixed Asset Accountant

Development of a common Opening Balances valuation methodology for UN Secretariat buildings and infrastructures

Real Estate Catalogue for the entire Organization

General Assembly Report
ST/AI/374 (DFS)
* Serialisation:
Windsock (No),
Dishwasher Domestic (No) / Dishwasher commercial/industrial (Yes),
Printer large network printers (Yes)
Property Management Unit - UNOG September 2014

One ST/AI on Property Management across the Organization.
Two Administrative Instructions:

IPSAS requirements
Minimize impact of change

Set up a comprehensive, coherent, and cohesive approach to the management of real estate assets of the UN Secretariat

Governance regime

Definition of property in new IPSAS
pre-Umoja environment – now includes real estate.

Delegations of authority?

Policies, processes, procedures

IPSAS Opening Balance Valuation methodology for UN Secretariat buildings and infrastructure – implementation plans prepared separately for peacekeeping and non-peacekeeping entities.
UN Secretariat Useful Life Schedules for buildings and infrastructure – DFS provided specific instructions to peackeeping entities based on data gathered.
AUC Costs Template and Guidance on accounting for costs related to self constructed assets at OAHS – DFS developed a separate template for peacekeeping entities because of the different nature of construction projects in Missions.
Write off and disposal procedures?

Information system

UN Secretariat Real Estate Catalogue developed to ensure harmonized inventory of infrastructure and real estate – worked closely with DFS to develop a catalogue that is applicable to all entities.
Building component, sub components and elements defined for major buildings to ensure consistent definition of building components across Secretariat.
Operational input provided into development of Umoja.

Financial System

Role of Fixed Asset Management Officer established to account for fixed assets including real estate and provide input into real estate strategy and decision-making.

Operational input provided into development of IPSAS Corporate Guidance.

Governance regime

Definition of property in new IPSAS and Umoja environment? - not likely to change for real estate

Policies, processes, procedures

Process for determining impairment and remaining useful life in real estate assets for IPSAS reporting.
Policies to enhance stewardship and control of real estate assets
Policies to ensure the effectiveness of management of real estate assets e g life cycle costing
Performance management system – establishing targets and goals for management of property and controls to ensure the objectives of effectiveness and efficiency are met.
Identification and further harmonisation of processes?

Information system

Master Data Governance process for Real Estate Catalogue to ensure Catalogue captures full range of assets.

Operationally support Umoja roll out? – provide guidance as required

Policies, processes, procedures

Operationally support Day 2 accounting? – provide guidance as required

Material Master

Harmonized Delegation
of Authority

Framework for the management of Capitalized Assets
Global KPIs
Property Management Manual
The goal is to present to the 69th GA sessions the Secretariat approach to the management of property given the requirements of IPSAS accounting standards, the adoption of a common system/integrated solution and the need to have a standardize framework & procedures.

General Assembly Report –
One Supply Chain Concept / UN Property Management Unit

With the implementation of Umoja, revisit our current supply chain management processes and control mechanisms to be:
more efficient (better utilization of resources)
in line with best business practice
revised and adjusted for continuous improvement

Working towards:
Establishment of common:
Manual and
Performance Management
One ST/AI for the Organization

Intangible, Real Estate property (land, and building), IPSAS requirements
the special items threshold (No longer $500 threshold)
group inventory as category (e.g., furniture and modular workstations)
the financial and stewardship requirements

Provisional and transitional ST/AI
Provides unified definition of property across Secretariat.
Incorporates expanded definition of property and additional requirements under IPSAS.
Minor changes to stewardship thresholds
New Role: Fixed Asset Accountant
At that time, we were working on identifying:
• Responsibilities
• Detailed tasks
• Role

The role is a property management function under the Logistics family
“Fixed Asset Management Officer”

Fixed Asset Management Officer major area of responsibilities*:
Process Management and Policy Compliance
Data Stewardship
Support to Accounting and Performance management

Job profiles for the Fixed Asset Accountant at the P3 and P4 level
Memo from ASG OCSS dated 24 January 2014, PMU-009, Subject: Generic Job Profiles for Fixed Asset Management Officer Roles

The End
Real Estate
Considering the complexity of the issue the project has been split in two phases:
• Phase I : Address IPSAS requirements
• Phase II : Harmonization
Streamline the process to make it more efficient

Phase I

from ASG/OCSS to all entities addressing new financial requirements:
Real estate property
Partial impairment
De-recognition of assets
Loss Property

First step towards Harmonization

The personal Delegation of Authority from ASG/OCSS to officials to be revised to:
Delegation of Authority under FRRs

The Delegation of Authority (former ST/AI/2004/1) from USG DM to ASG/OCSS and Controller to be amended to reflect the revised FRRs (ST/SGB/2013/4).
Delegation of Authority under FRRs

Currently there are more than 20 different versions of DoA for Property Management Issued by ASG/OCSS
Implementation plans prepared separately for peacekeeping and non-peacekeeping
It covers two functional areas Finance and Property Management
ST/AI 'Management of Property'

Delegation of Authority under FRRs
Delegation of Authority under FRRs
• New Definition of Property

• FRR numbering updated to reflect new ST/SGB/2013/4

• Physical verification and maintenance of records added to cover new Rule 105.21 (ST/SGB/2013/4)

• Property Survey Boards replaced with Review Bodies for Property Management.

• For intangible assets, ASG/OCSS shall consult CITO and other officials as applicable.

Property Management Delegation of Authority
from ASG/OCSS to Officials
Real Estate
Real Estate
Memorandum from ASG/OCSS to all entities
The framework will define how to:
• Record the cost of newly-acquired fixed assets;
• Track existing fixed assets
• Record depreciation
• Assess and record impairment
• Account for the disposition of fixed assets
• Verify that asset information has been entered accurately for the purposes of financial reporting.

Establishment of data governance for Real Estate
How to manage it, physical verification process/assessment of conditions…etc.

PMU is currently validating the real estate valuations for submission of Opening Balances
Fixed Asset Accountant
Fixed Asset Accountant
PMU contributed to:

• Umoja analysis to map the “as is” vs the “to be” processes
• Business Processes
• Role mapping
• Definition of Property through development of Material Master Catalogue and Serialization requirements
Material Master Data establishes “one common language” used through the various Umoja’s business processes (All users access the same data):
Material Master Status:
Real Estate
Real Estate financially reported for the first time
A common real estate valuation strategy has been developed and endorsed.

Real Estate Catalogue defined - Memorandum from ASG to all entities
UN Secretariat useful life definition schedules for buildings and infrastructure developed - Memorandum from ASG to all entities
Assets Under Construction template and guidance on accounting for costs designed.
Serialization criteria based on nature/characteristics.
* Value, Capitalize, Depreciate,
properly account for and report
Phase II:
One central Unit to establish the above

One Property Management
Establish and oversee the implementation of the performance management system by defining key performance indicators (KPI’s) for measurement, comparison, and evaluation of property management factors.
Independent physical verification, independent Vs. warehouse

of 16 June 1992, “Property records and inventory control under revised definition of non-expendable property”
of 19 May 2013, “Property management and inventory control at United Nations Headquarters”
First step towards Harmonization
Thank you
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