4. Database Design

Oracle FLEXCUBE offers very high degree of flexibility to the users in respect of basic parameters around which the bank operates or wishes to operate. This is one of the most critical activities in the implementation project and requires a detailed analysis of the bank s current and expected operations. The exercise involves not only understanding and translating the existing process methodologies but also suggesting and exploring the possibilities of better and improved strategies so as to exploit the full potential of Oracle FLEXCUBE. This activity in fact begins during the product walk-through stage itself.

This chapter contains the following sections

• Section 4.1, "The Designers"
• Section 4.2, "The Design Process"
• Section 4.3, "Review of Products"
• Section 4.4, "Review of Account and Ledger Structure"
• Section 4.5, "Outlining Basic Core Parameters"
• Section 4.6, "Gathering Customer Data"
• Section 4.7, "Outlining Product Level Parameters"
• Section 4.8, "Review of Advice, Reports and MIS Requirements"

4.1 The Designers

The team doing the database design comprises the following:

• Project Manager from Oracle Financial Services (formerly i-flex)
• Project Manager from the bank
• Financial Controller of the bank
• Functional heads of the bank
• IT head
• Key operational staff

4.2 The Design Process

The process involves the following major steps:

• Review of products/business offerings of the bank
• Review of Account and Ledger structure
• Review of charges/interest items
• Outlining basic core parameters
• Gathering Customer Data, including credit lines.
• Outlining product level parameters.
• Review of advice, reports and MIS requirements.
• User profiles including access rights, transaction and authorization limits etc.
• System performance parameters.

4.3 Review of Products

The spectrum of products currently offered by the bank and those proposed to be offered by the bank have to be carefully analyzed. The exercise would involve

• Identifying the nature of the products.
• Listing the basic features of each product.
• Possible regrouping of products based on common features or parameters.
• Restrictions of currency, branch, in the products.
• Differentiation in making available the products among different class of customers/branches etc.

4.4 Review of Account and Ledger Structure

The exercise involves designing the Chart of Account. The existing account structure has to be analyzed and possibly redrawn based on the new requirements as also the keeping in view the features offered by Oracle FLEXCUBE. The tiered (tree) structure of accounts, the nature and type of each GL with parent-child relationship has to be established. Currency and branch restrictions at each GL HEAD level have to be taken into account. The Central Bank and Head Office reporting requirements have to be analyzed. The nature of account code structure (GL account mask) has to be established and appropriate code numbers assigned to accounts.

4.5 Outlining Basic Core Parameters

Core level parameters and codes are established in this activity. Some of major parameters are:

• Bank/Branch parameters including name, address, GL mask, Customer a/c masks, restricted passwords and other particulars.
• Currencies - Currencies used by the Bank, Currency codes, Currency pairs, Rate types, Rate codes, Conversion definition etc.
• Reporting Lines - for Head office and Central Bank reports, establishing links with GL accounts
• Holidays
• Accounting Periods - within a financial year
• Inter-branch Accounting set-up
• Limits - Lines, sub-lines
• Transaction codes with clearing float days etc
• Messaging Parameters
• Override Parameters
• Product groups
• Product Status codes
• Account Revaluation set-up
• End of cycle setup, including frequency of processes, sequence of process
• Classes for securities modules usage

4.6 Gathering Customer Data

• Establishing broad customer categories and account classes
• Obtaining a list of customers and reclassifying the customers based on the categories (customers would also include Central Bank, correspondent banks, clearing house, brokers etc.)
• Deciding on the Customer Identification code structure
• Allocating new CIF to the customers
• Obtaining other static information about the customers
• Maintaining a translation table for old and new CIF numbers if any
• Account statement periodicity
• Broker setup, including brokerage rates etc

4.7 Outlining Product Level Parameters

This is critical activity and should be very carefully undertaken. The products defined are applicable across all branches and are defined only at H.O. Major steps involved are:

• Identifying products within each functional modules (including Account Class in respect of Current Savings and Nostro Accounts)
• Identifying the basic features of each product for product level parameters, including the events for each product
• Identifying the accounting entries to be passed and the advices to be generated for each event
• Interest, commission, charges and fees applicable (ICCF Rules).
• Taxes Applicable (Tax Rules)
• Identifying GL accounts for the products including ICCF and tax components
• Product start date should be given carefully (the value date of the oldest live contract under the product)
• Mapping accounting Roles to the respective accounts
• Identifying life cycle events and mapping accounting roles
• Product restrictions in respect of branch, currency, customer categories etc
• In the case of Securities module, the parameters have to be identified for three types of Products – Security product, Portfolio product and Deal product

For more detailed product level parameters set-ups, respective user manuals must be referred to.

4.8 Review of Advice, Reports and MIS Requirements

• Examining various advices required to be generated during the life cycle events of a product.
• Formats of all advices, including Customer Account statement.
• Customized advice formats for specific customers.
• Media for sending advices to various customers.
• MIS reports, codes including MIS cost codes, MIS classes, pool codes, MIS groups, GL linkages
• Report set-up, including printer set-up, server and client printing
• Report generation periodicities and circulation
• Report and advice archival

This section contains the following topics

• Section 4.8.1, "User Profiles Including Access Rights, Transaction and Authorization Limits"
• Section 4.8.2, "System Performance Parameters"
• Section 4.8.3, "Other Activities"
• Section 4.8.4, "Review of the Design"

4.8.1 User Profiles Including Access Rights, Transaction and Authorization Limits

• Defining user profiles or roles
• User transaction limits
• User authorization limits
• Restricted passwords
• User time level
• OS, RDBMS access to Data center personnel, joint access etc

4.8.2 System Performance Parameters

• System parameters to optimize performance, at the OS level
• System parameters to optimize performance, at the RDBMS level
• System parameters to optimize performance, at the network level
• System parameters to optimize performance, at the workstation level

4.8.3 Other Activities

• Changes to existing workflow to take advantage of new system set-up
• Gathering information for customer accounts and nostro accounts
• Creating Translation tables for new and old account numbers
• Identifying vaults and cash tills
• Collecting data of user to product mapping in the operations for assigning user roles to enable the users to do the work allotted to them
• Identifying Teller type transactions - including charge-bearing transactions
• Customer settlement accounts
• Branch level parameters for various modules with respect to accruals
• Deciding the source for consolidated financial reporting, in case of a phased implementation, where some branches would be only on the old system and some would be on Oracle FLEXCUBE
• Deciding backup procedures including frequencies, media etc

4.8.4 Review of the Design

The Database design should be reviewed and signed-off by everybody involved in the database design exercise.