Enhancing Financial Planning at Avago Technologies with Hyperion Applications

1. Moving Data within a Planning Application at Avago Technologies Audrey HolifieldProject Manager, FP&AAvago Technologies Patrick LouieDirectorHackett Technology Solutions

2. About Avago Technologies • Leading global manufacturer of optoelectronics and analog interface components • Former semiconductor business of Agilent Technologies • $1.6B in annual revenue • Primary Locations: California and Singapore • Primary Finance Locations: California, Singapore and Malaysia

3. About Hackett Technology Solutions • Provide Professional Consulting Services for all of Oracle’s Hyperion suite of products • Publicly traded on the NASDAQ (symbol: ANSR) • Formerly known as Answerthink • #1 Hyperion Americas Reseller Award at Solutions 2006 and 2007

4. Agenda • Introduction • Main Considerations for Design • Issue 1 – Workforce Inputs • Concerns • Solution • Issue 2 – Functional Reporting • Concerns • Solution • Closing • Q&A

5. Introduction • Avago Technologies decided to implement a Hyperion Planning application to enhance the efficiency of its budgeting, forecasting, and financial reporting cycles for both the Income Statement and Balance Sheet. • Three databases deployed at Avago: • Workforce (Employee level planning) • FINSTMT (Annual Operating Plan at account, department and country level) • FCST (Forecast and monthly reporting at summary level)

6. Main Considerations for Design • Performance • Simple for users • Supports user analysis and reporting needs

7. Issue 1: Workforce Inputs • Finance users making salary and benefits entries to the Workforce database • Need to see the effects on the Income Statement in the FINSTMT database • Waiting for scheduled batches to transfer data from Workforce to FINSTMT would slow down the planning process

8. Concerns • Scheduled batches would have to be broad in scope and would affect performance while the batch was in process • Run-time prompts could lead to human error • Users could forget to run scripts to transfer data, leading to expenses not populating in FINSTMT as expected

9. Solutions • Hyperion Business Rule that utilized the @XREF function to transfer data from Workforce to FINSTMT • Using Variables in the HBR that could take the POV from the form so that only the members that were being written to were transferred; the changes were then aggregated up in FINSTMT with the @ANCESTORS function • HBR wasset to ‘run on save’ in the input form

10. Workforce Input form with Business Rules

11. Issue 2: Functional Reporting • Operating expense accounts jointly used by all functions at Avago (i.e. people and project expense account numbers) • Functions appear at in different sections of the Income Statement (i.e. R&D is function 2, Marketing is function 4) • Previous application used by Avago was set up for a unique account and function combinations, which created 5x number of expenses accounts (i.e. 800001 – FN1, 800001 – FN2, etc.) • Need an intuitive solution so users can easily enter expenses and have them appear in the correct section of the Income Statement without complicating the account structure

12. Function breakout on Income Statement

13. Concerns • Having same accounts appear at different points on an Income Statement hierarchy could create duplicate data • Relying on all users to use Account and Function combinations in reporting and analysis is cumbersome and risky • Need database to correctly calculate the various subtotal values of the Income Statement (i.e. Cost of Sales, R&D, Admin)

14. Solution • Create custom accounts dedicated to each function that could be placed at different points in the Income Statement hierarchy • Create People Expenses, Project Expense and Absorption accounts specifically for each function

15. Custom Functional Accounts

16. Solution • Create custom accounts dedicated to each function that could be placed at different points in the Income Statement hierarchy • Create People Expenses, Project Expense and Absorption accounts specifically for each function • Use member formulas to copy level 0 data for department and geography from each of the specific functions

17. Custom Functional Account Member Formulas

18. Solution • Create custom accounts dedicated to each function that could be placed at different points in the Income Statement hierarchy • Create People Expenses, Project Expense and Absorption accounts specifically for each function • Use member formulas to copy level 0 data for department and geography from each of the specific functions • As a maintenance and scaling compromise, detailed analysis on those expense accounts would be done at an Account/Function level

19. Shared Accounts

20. Closing • Solutions were efficient to not slow down the planning process • Users were not required to use a complex process to enter data • Structure supports reporting requirements

21. Q&A