Functionalities

Question 1

PA File

Answer 1

Track all PC project balances incl: DC, PB, PC, ECA, NRE, WIP, Loss
Be able to explain HFM balances: Composition of ledger and drivers of variances overtime.
Solar Carve-Out

Question 2

Roll Forward

Answer 2

Reconcile walk to PA File info. from opening balance to closing balance.
Walk from DC to PB to PC.

Question 3

Rev Rec DR

Answer 3

To disclose contract asset & liability activity in terms of rev rec’d in current period that is not a result of current period performance.
Walk from DC to PB to PC

Question 4

3 Contract Buckets

Answer 4

CSA’s, Non-CSA’s and Equipment

Question 5

Levelization

Answer 5

The exclusion of intercompany activities in order to have ‘accurate’ margin

Question 6

Frozen Balances

Answer 6

Projects where net asset/liability balance is moving < 20% through 3 consecutive quarters.
Essentially, nothing is being billed, collected or rev rec’d, therefore a risk to bring to CFO.

Question 7

HFM

Answer 7

Source of Truth

Question 8

606RM

Answer 8

Rotating Machines: Manufacturing mostly motors

Question 9

606SY

Answer 9

System: High level integration with motors/power electronics. Upfront engineering

Question 10

606PE

Answer 10

Power Electronics:

Question 11

606SR

Answer 11

Service: Training, field service engineers, service agreements.

Question 12

Planned Costs

Answer 12

Total estimated costs for project. To be updated as per last CMR. Basis for POC calculation

Question 13

Non-Fungibility Point

Answer 13

Point where engineering design is finalized and manufacturing process has started, so from this point on wards, all costs incurred will be transferred to customer and will measure progress and revenue. When products are manufactured, Considered fungible i.e. could be reused for another customer.

Question 14

NRE

Answer 14

All costs incurred before NFP. (Costs not transferred to customer but required to fulfill the contract).

Question 15

Planned Revenue

Answer 15

Total transaction price excluding variable consideration. ( because any non-firm commitment value does not create enforceable rights and obligations)

Question 16

Warranty Balance File

Answer 16

Shows information of projects that are making warranty reserves. The point is to check:

• Non-Substantiated Reserves
• General Warranties that have expired but still has reserve balance (P/L consideration)
• Reserves expiring next quarter - Check if correct & compliant
• Reserves overrun by 250k

Question 17

General Warranty

Answer 17

Standard Warranties included in contracts sold.

Question 18

Specific Warranty

Answer 18

Reserves made for specific situations

Question 19

Non-Substantiated Warranty

Answer 19

No End/Start Date provided. If cashpool related, considered substantiated.

Question 20

Deferred Charges DR

Answer 20

To split DC account into Service & Equipment, as well as Solar vs non-Solar

Question 21

Solar Recast

Answer 21

To split all contract asset/liability accounts into Solar vs non-solar, by region. Has impact on PC & Hybrid.

Question 22

LT Equipment DR

Answer 22

Providing insights into long-term contracts in terms of progress collections and associated losses (loss reserve + # of contracts).

Question 23

FRP

Answer 23

Financial Reporting Package: Compliance oriented report to deliver information to stakeholders about what the business is doing.

Question 24

Frozen report: Significant DC and WIP Accounts

Answer 24

Balance positions that are 1M$. Check if billing risk exists.

Question 25

Frozen Report: Alert Report

Answer 25

Checking for inconsistencies in Keops report. 3 main topics:
Close-Out 606 B/S > 100k$ : When POC is = or > 94%, yet significant B/S position exists.
Act Cost < NRE: Just does not make sense
OT & Act Cost > Planned Cost : A CMR adjustment is needed (bad estimate is still being used).

Question 26

Frozen Report: AR Risks

Answer 26

Looking at medium-term BDR risk. AR accounts with collection risk related to:

1) Customer financial prospects
2) GEPC misperformance which led to litigation
3) Invoice Timing Issue
4) Other

Question 27

Scorecard

Answer 27

To track controllership team efficiency during monthly close. Tracks the 50 closing activities related to financial statement lines (Regions) and the 11 Internal Process KPI’s (HQ)

Question 28

SMF

Answer 28

Supplier Masterfile: Suppliers in this list are validated and therefore have automated payments in place.

Question 29

Internal Transfers

Answer 29

When cash pools managed by Treasury are used to transfer money to an entity so they can meet an obligation, and after entity restores the cash used. The use of preferred banks increases these transfers.

Question 30

Golden Rule

Answer 30

When manual payment comes, check if supplier is in SMF.
If yes: No manual payment
If no: Then include in SMF
EXCEPT: if payment is urgent, as it takes a long time to include in SMF

Question 31

Three defined categories of payment

Answer 31

External Suppliers, Internal Transfers, IBS (Internal Business Settlement)