89092672 r12-functionality

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89092672 r12-functionality

  1. 1. Sub Ledger Accounting (SLA)"It’s not 3 Cs any more".First things first - You need not know SubLedger Accounting to perform an Implementation. Onecan use the Standard seeded SubLedger accounting methods itself. However if the client wants aspecial accounting treatment to be followed on a case to case basis, then we should knowsomething on SLA.Firstly, one can create a new SubLedger accounting on his own (which will be a huge timeconsuming process).Secondly, one can copy an existing SubLedger accounting and make changes wherever required(Highly recommended).Thirdly, SubLedger methods owned by Oracle cannot be alteredSubLedger accounting method which is given by oracle are standard, which means they are notspecific to any chart of accounts, they work in the same manner. However one can create aSubLedger accounting method for a specific chart of accounts.The introduction of SubLedger accounting also changes the way in which transactions aretransferred to GL.Earlier in REL 11,SubLedger > Create Accounting >Run Transfer to GL > GL interface > GL Main TableNow in REL 12,SubLedger > Create Accounting > Sub Ledger tables (XLA) > Run Transfer to GL > GL Interface> GL Main TableThe only difference in the accounting methods followed in REL 11 and REL 12 is that, access tocreate an accounting method is given in the front end itself to the users in REL 12 which was notthere in REL 11.
  2. 2. Enhanced Feature - Create Accounting at Sub Ledger LevelAnother enhanced functionality in Release 12, is nothing but CREATE ACCOUNTING program,which is related to Sub Ledger Accounting. Briefly, Create Accounting program is used to carryout accounting for transactions that are recorded in the sub ledgers based on the accounting rulesthat are mentioned in the Sub Ledger Accounting Method.You may think that we also had this create accounting functionality in Release 11 under PayablesApplication. We did had this in Release 11 itself, but it was limited only to Payables module andnot to the other modules, now in release 12 this functionality is extended to all sub ledgerapplications along with some enhanced features.Now let us see, what the enhanced features of Create Accounting Program are.In Release 11, when you create accounting for transactions, it will be done immediately; you didnot have the option of previewing before accounting. This led us to lot of reconciliation worries inmonth end, since some manual entries get passed in General Ledger.Unlike previous versions, Release 12 has provided the user with three new functionalities underCreate Accounting Program. They are:1) DRAFT Mode - It is nothing but draft accounting which will help the user to know what are theaccounts that are getting used for this particular accounting event. You can correct your transactionby looking at the draft entries. Draft entries will also be included in Accounting reports, but itcannot be transferred to General Ledger since it does not reserve funds and does not updatebalances. An entry in draft status can be Updated and Deleted.2) FINAL Mode - It is normal online accounting functionality which we had in earlier releasealso. It means that entries created using this mode cannot be changed. After performing thisaccounting, transaction becomes eligible to get transferred in to General Ledger any time.3) FINAL POST Mode - It is a very useful new feature, which does the operation of Straightthrough accounting. When you select this particular feature, it Creates Accounting for theTransaction with the mode Final, and transfers the accounting entries to General Ledger and it alsoposts those entries in General Ledger.With the help of new enhancements in Create Accounting feature, transactions and balances can beup to date and reconciliation is made easy.
  3. 3. Is SLA a clone of AX?Yes, almost the functionality was derived from there itself, lets see vis-à-vis touptake some of the functionality in these two products.Not only functionality, some of the reports replaces the corresponding reportsof the Global Accounting Engine.The good is that both the Global Accounting Engine (AX) and Oracle SubLedger Accounting(SLA) generate accounting from a compiled definition of accounting rules defined by users. OracleSubLedger Accounting further maintains version control on the rules enabling users to modify therules while maintaining auditabilityFrom Product Accounting to SubLedger Accounting:Most of us are well aware that in Release 12 of Oracle Applications, SubLedger Accounting (SLA)has been introduced, which is a Rule-based accounting engine, toolset & repository which issupporting most of Oracle business Suite modules. As we know driver for this introduction is tohave an option of allowing multiple accounting representations for a single business event,resolving conflicts between corporate and local fiscal accounting requirements. The Functionalityis somehow very similar to Global accounting engine, which oracle does offer for Europeanreporting need.
  4. 4. So what is SubLedger Accounting?• SLA is an intermediate step between SubLedger products and the Oracle General Ledger• Journal entries are created in SubLedger Accounting and then transferred to Oracle GeneralLedger• Each SubLedger transaction that requires accounting is represented by a complete and balancedSubLedger journal entry stored in a common data modelIs this Module or what?It is good to know, SubLedger accounting is a service, not an application.The high points of SLA would be: • There are no SLA responsibilities • Users do not login to SLA • SLA is a service provided to Oracle Applications • SLA forms and programs are embedded within standard Oracle Application responsibilities • SLA provides the following services to Oracle Applications • Generation and storage of detailed accounting entries • Storage of SubLedger balances (e.g. third party control account balances) • SubLedger accounting entries • SubLedger reporting (e.g. SubLedger journal reports, open account balances listing)What oracle application Module is taking services for SLA?Most of modules which need accounting entry with finance uses service of SLA Modules.This new Product has many new functionalities such as: • Journal Entry Setup and sequencing • Date Effective Application accounting Definitions • Multiple Accounting Representation • Multi-period Accounting • Summarization Options • Draft and online accounting
  5. 5. • Replacement for disabled accounts • Process category Accounting • Transaction account Builder • Accrual Reversal Accounting • Accounted and Gain/Loss Amount calculations • Application Accounting Definition Loader • Enhanced Reporting Currency FunctionalityThe overall advantage of SLA can be summarized by oracle as below:GL Flow with SubLedger-Level Secondary LedgerLet us take a case, with a scenario with basic Finance module; you can find how tightly accountingmodel is separated with transaction model in release 12.
  6. 6. This is the typical flow within one product with SLA can be best described as:
  7. 7. Analyzing SubLedger accounting:With this new feature: • All accounting performed before transfer to the GL. • And this is achieved by user setup of defining accounting rules.At the data level, it’s a big change for all the SubLedgers, though there are first generation changeswe have noticed sometime when 11i Payables where concept of “Accounting Events” introducedfirst time and accounting was performed at SubLedger level first before moving into GL.The same idea has been incorporated in new sub ledger accounting model, indeed there was a realneed because of some uneven functionality likes: • Inconsistencies in Accounting Generation like Summary vs. Detail • Direct to General Ledger vs. Open Interface • Inconsistent Drilldown from General Ledger • Also it has been seen that there are inconsistent Mechanisms for controlling Accounting as certain options has been used in existing version: o flex builder o Account Generator o Automatic OffsetsWhat does SubLedger mean for a non finance person? • A new transactional application that generates accounting impact • Used to store detailed information not needed for a general ledger • Sub ledgers post summarized activity to a general ledger periodically to maintain centralized account balances for the companyWith these accounting at this level the respective sub ledgers & General Ledger is tied out, asbelow.
  8. 8. SLA Key attribute: Something called Event Model. What is it all about?Event Models are basically definition of the sub ledger transaction types and their life cycle.It has three levels • Event Entity: Highest level, often 1 per sub ledger application
  9. 9. • Event Class: classifies transaction types for accounting rule purposes • Event Type: for each transaction type, defines possible actions with accounting significance.It is very important that applications must tell SLA when an event has occurred? When a user runsthe SLA Create Accounting program, it processes all events with the appropriate statusSome of event classes in Payable and Receivable: • Payables o Invoice o Debit Memo o Prepayment o Payments o Refunds • Receivables o Invoice o Deposit o Receipt o Bill ReceivableAnd typical event Types are like: • AP Invoice Events o Validated o Adjusted o Cancelled • AR Receipt Events o Created o Applied o Unapplied o Updated
  10. 10. o ReversedThe Legal Entity Concept:In Oracle Ebusiness Suite 11i, the Legal Entity is tied closely to a set of books and operating Unit,so your Legal Structure has to be defined in the way you set up your apps partitions (OU, Set ofBooks etc.). In R12, financials breaks away from that with the introduction of the Legal EntityConfigurator allowing you to model your Legal Structure separately from the partitions in yourERP system. Then you mark certain items with an owning LE, rather than use the OU or set ofbooks to derive the LE. So let’s see what we are getting out of it:Let’s first look at what we map Legal Entities to:1. Accounting Structures - Balancing Segment Values and Ledgers2. Tax Rules in eTax - Who I am and where I am registered/located determines what tax I need topay3. Bank Account - Who owns that bank account and the cash in it?4. Payables and Receivables Invoicing - the owner of that transaction, sometimes referred to as LEstamping5. Intercompany Accounts and Intercompany Processing RulesThere are a number of features that you get from this, probably the biggest is tax. The new eTaxmodule in R12 allows very flexible definition of tax rules, based on the Legal Entities and the taxregistrations. It makes your tax calculation and reporting a breeze.Intercompany is obviously a big feature, we now base the Intercompany rules on the From
  11. 11. (transacting or Initiating) LE and the To (trading partner or Recipient) LE, which not only allowsmore realistic rules, but provides us with the mapping we need to give you the neat InteractiveReconciliation Reporting.Also on the Intercompany Front it allows us to define a couple of important rules. Firstly we candefine Intercompany Exceptions, that is for LE x, I might want to state that it should not doIntercompany with y and z. Secondly I can set a Legal Rule to tell me when there is a Legalrequirement for an AGIS transaction to generate an Invoice rather than just create GL journals.Bank Account ownership is now by a Legal Entity, so we can more easily determine when a cashtransaction is crossing a Legal Entity and intercompany accounting is needed.There are also a large number of Legal reports which have Legal Entity as a parameter, so thenumerous reports shipped in R12 will make it easy to the compliance and statutory details youneed on each Legal Entity that has to report. The Oracle Financials globalization products ship themajority of these reports.Can I assign an operating unit to multiple legal entities?The short answer is sort of. This is not much help to anyone.In R12, a new Legal Entity Configurator is introduced in financials and Legal Entities defined hereare assigned to Ledgers and/or Balancing Segments (Company Codes). However it is not possibleto assign a Financials Legal Entity to an Operating Unit, you can only define a Default LegalContext (DLC) to an Operating Unit. This assignment can cause confusion as it is only possible toassign one DLC, but I can use more than one LE in that Operating Unit. The key word in DLC isdefault.When I am in Payables or Receivables the LE is stamped on the transactions and used to identifythe Legal Owner for legal reporting as well as Tax calculation. The invoice exists within an OUand that OU has a ledger which will account the transactions, if that has more than one LEassociated with it then a hierarchy of LE derivation is used to default an LE, the last resort beingthe DLC.For example in AR the Legal Entity derivation hierarchy for transactions is 1. Transaction Type 2. Batch SourceAssigning a LE to a transaction type or batch source is optional and only the LE’s mapped to theLedger associated with the OU are available to assign.
  12. 12. So in R12 we have much better support for many LE accounted in a single OU as we clearly markthe LE on the transactions.How do I define my legal entities?In the real world a Legal Entity (LE) can enter into contracts, own cash (bank accounts), employpeople, pay taxes, be sued and similar. In Oracle Financials Release 12, a whole new product;Legal Entity Configurator was created to manage them. It will allow you to define your real worldLegal Entities and then map them to the E-Business Suite objects and structures. Transactions arestamped with an owning (first party) Legal Entity and that will be used to drive tax, accounting,intercompany and Legal Reporting.So let’s look at the relationships LE have to other E-Business suite objects.1- Accounting StructuresIn the General Ledger Set Up a Legal Entity can be mapped to • A Single Ledger • One or more Balancing Segment Values (aka Company Code) within a ledger.2 - Operating UnitThere is no explicit mapping of Legal Entity to an OU, the relationship is derived from the ledgerassigned to the OU and the Legal Entity mappings to ledgers as detailed above.So how might you set up your LE in relation to your other set up in financials? There are twoimplementation models1: Many • LE are mapped to the Balancing Segment Value (BSV, aka Company code) within a Ledger, so multiple LE are accounted for in a ledger. • An OU will have one Ledger assigned so transactions for many LE are processed and accounted in a single OU1:1:1 • A single LE is mapped to a Ledger • An OU will have one Ledger assigned • Therefore an OU only has one LE (that means it is easy to derive the LE given the OU)So what model should you use?That depends where the LE are registered.The 1: M model is recommended and preferred in the US, the 1:1:1 model is recommended formost non US regions.
  13. 13. We are well aware of some of Oracle E-Business Suite R12 Architecturalchanges in the Financials section like: • Legal Entity • Ledger Sets • Accounting Engine (SLA) • Transaction Based Taxes(E-Tax) • Inter-company Accounting (AGIS) • Multi Organizational Access Control (MOAC)Let’s uptake to Legal Entity:Financial books defined a “Legal Entity as an entity identified through theregistration with the legal authority.”That means, in this compliance oriented world and in Oracle system itcorresponds closely. The system “Legal Entity” corresponds with anindependently identifiable “legal person” a public company, a private businessor limited partnership, a trust, a not-for-profit, a government or a non-government organization (NGO) - that can operate as if it were a real person inconducting business transactions.What is meant for with LE? • Can get the right to: o Own property weather it is asset or inventory or receivables o Trade (borrow, sell, buy, incur expenses, employ) • And the responsibility to: o Repay debt (liabilities, equity) o Pay Taxes o Account for themselves (legal reports, audits)Note for R11i with respect to R12Release 11i GRE/LEs will be upgraded as Release 12 Legal Entities.Release 11i Operating Units and Inventory orgs will be upgraded asEstablishments.
  14. 14. One Legal Entity can have several establishments. • In Release 12 there is no specific link between Operating Units and Legal Entities where as in R11 it was. • The Legal Entity is linked to a Ledger and the Operating unit is also linked to a Ledger. • Every Release 12 transaction must be associated with both an Operating Unit and a Legal Entity. • The Legal Entity is also required for e-Business Tax to establish which taxes will be applicable to the transaction.The New Model called LEA (Legal Entity Architecture)Legal Entity architecture, which is new in this release, provides users with theability to model an enterprise’s legal organizational structure and define rulesand attributes specific to legal entities.Bank Account whether it is remittance bank or internal bank is now owned bythe Legal Entity instead of Operating Unit, and can be used by any of theOperating Units sharing the same Ledger as that Legal Entity.As marked (dotted red line) in above figure the relationship between legalEntity and Operating Unit is no more active. This concept allows OperatingUnits to be governed by more than one jurisdiction, but the accounting is stillperformed in a single ledger.Multiple Legal Entities can be associated with a single Ledger, allowing the LEsto share the same ledger and chart of accounts, calendar and currency. EachLE points to one Ledger.Multiple Operating Units can also be associated with a single Ledger. Each OUpoints to only one Ledger.Take a note; in R12 EBS multiple legal entities can be associated with a singleLedger, allowing the LEs to share the same ledger and chart of accounts,calendar and currency. Each LE points to one Ledger. Multiple Operating Units
  15. 15. can also be associated with a single Ledger. Each OU points to only on Ledger.Where it affects:“Most of the Financial Application Products”Cash Management (Bank)In Release 12, Bank Accounts are owned by Legal Entities and can beaccessed by multiple Operating Units.As we know in 11i the Bank Accounts were Operating Unit Specific.For all Internal Banks should be assigned to a Legal Entity.Receivables:Now all REC activity must have a legal owner, so Legal Entity is stamped onevery transaction. Receivables activity such as transaction whether creditmemo or debit memo or invoice must have stamps on it and receipt headerwith the Legal Entity information.Because there can be multiple legal entities using the same ledger, it may benecessary for the user to assign the LE. Each transaction can only belong toone Legal Entity, so when multiple legal entities exist, either the system or theuser will assign the LE. • TransactionThe defaulting hierarchy for a transaction comes from the setup of theTransaction Type and Transaction Batch Source. Receivables will look first tothe Transaction type. If a LE has not been assigned, then Receivables will lookto the Batch Source. The assignment of the LE to the Transaction Type andTransaction Batch Source is option, so if Receivables cannot find a default LE,then it is up to the user to provide the LE value. • ReceiptsThe LE defaulting for receipts works differently than transactions. Let’s look athow defaulting occurs for the Receipt Header.As we know, internal Bank Accounts are now owned by legal entities instead ofoperating units, so LE defaults from internal (remittance) bank account. TheReceipt Method in Receivables has the bank account assignment, whichdetermines what bank account gets assigned to the receipt.Take a note in version 11 the receipt Method was called the Payment Method.Now in Release 12 this is featured with same name “Payment Method” nowused by new application called Oracle Payments. Therefore in AR, you will now
  16. 16. see a Receipt Method, which is part of receipt setup; and Payment Method,which is part of Payments setup. Once the bank account is assigned to areceipt header, this information can be used to find the appropriate LE.Because the LE comes from only one source, the bank account, there is nospecial setup to be performed in Receivables. Defaulting of the single LEalways occurs, so the user does not need to assign or update LE on receipts.How LE affects receipts and their applications and refundsWe have seen that the receipts inherit the LE from the bank account weatherit is manual, Automatic, Lockbox and Post Quick Cash Programs. There is noway that user can change the value.Receipt application across Legal Entities is allowed if the receipt andtransactions are in same OU and Sub Ledgers Accounting will be performed byinter-company accounting for cross-LE receipt applications or cross-LE receiptclearing.SLA will create inter-company accounting as long as LE is setup as one of theCCID (Account Code Combination) segment derivation sources in SLA.PayableInvoices and Payments indicate the operating unit and the legal entity ownerof the transaction. The legal entity can be used as selection criteria whenpreparing pay runs.ProjectsAs we know in 11i, EBS maintains the default legal context on the OperatingUnit. There is not much impact in Projects model. Earlier in 11i we used toconsider the Legal Entity of the Operating Unit as the Legal Entity of theProjects Transactions. Now the Legal Entity is attached at the Default LegalContext of the Operating Unit is the Legal Entity of the Projects Transactions.So the Legal Entity of the Projects expenditure transactions will be the LegalEntity attached at the Default Legal Context of the Expenditure Operating Unitand the Legal Entity of the Project will be the Legal Entity attached at theDefault Legal Context of the Project owning operating unit.LE and TCALegal Entity is still dependent on TCA. A party (supplier, customer, bank,student etc) is an entity that can enter into business relationships. As we knowthe Oracle TCA’s model supports four types of parties: organization, person,group, and party relationship. Under the TCA model, Parties (including LegalEntities) exist just once in our E-business Suite system for single maintenanceand consistency. Legal Entities will be stored in TCA as Parties of party type‘ORGANIZATION’. A Legal Profile, containing specific Legal Entity attributes,
  17. 17. will be associated to the TCA Party. In addition, other TCA components will beused for Addresses, Contacts, Party Information, etc.Where to do the setupThere should be no confusion.May be , some may think if this is just extension of GRE/LE from old version ,then Why this required to do set up from both ASM and HR in R12?In R12, the legal entity is separate from the GRE which is a HR organization.We did not link the 2 entities together as they serve 2 different purposesaltogether.The HR model does not look at the new Legal Entity model. It continues to usethe GRE/LE as a legal entity. So the HR requirement can be achieved using theHR organization of type GRE/LE.Therefore, Legal Entities do have to be set up in both ASM and HR in R12Management Reporting Security:In R12 there is a new management segment qualifier for chart of accounts.This would qualify a segment to be the management segment if that segmenthas management responsibility and you can facilitate setting of Read, Writeaccess permissions while defining Data access set in GL.With this new concept you can: • Enable management reporting and analysis • Provide a better controls access to specific MSVs based on management responsibility and this can o prevent managers/line managers from viewing or updating data for cost centers, lines of businesses, product lines, etc. that are outside their responsibility o Secure access to ledgers and management segment values o Grant read only or read and write access to management segment valuesThis can be best understood as with this simple example, assume youBusiness COA is based out of three things like
  18. 18. • line of business • cost center • product lineYou can set Qualifier with any of the segments. The added benefit of using amanagement segment is that you can now secure management segment valuesusing data access sets. So you can grant read only or read and write access tospecific management segment values to prevent certain managers from viewing andupdating data for cost centers, lines of business, or product lines outside of theirmanagement authority.Defining and Designing your Management segment qualifierDefine a management segment if you want to perform management reporting andsecure read and write access to segment values for the management segment. Thissegment can be any segment, except the balancing segment, natural accountsegment, or intercompany segment.How it worksThis can be understood as, lets we have four cost center likeC0699,C0101,C0201,C0312 and these cost center have Vice President, director A,director B and Director C respectively. The Organizational Chart of cost centerhierarchy is as figure below.If you assign the cost center segment as the management segment, read and writeaccess can be secured to certain management segment values based on the cost
  19. 19. center manager.In above example , Director A has read and write access to only cost center C101.Director A does not have access to Director B’s or Director C’s cost center or to theVice President’s cost center. This will true for others when you set to other. This wayyou can secure Management reporting.If you have given Read/Write to Parent Cost center 0699 to the Vice President, on theother hand, would have full read and write access to cost center C0101, C0201 andC0312 which is the parent of the direct reports. Thus, in that case the VP has fullaccess to all direct reports’ data.Benefits of Management Reporting SecurityThe new management segment qualifier in combination with data access sets pavesthe way for management reporting and analysis. You can restrict access to differentmanagement segment values and assign them to different managers in yourorganization.How this can be achieved in EBSThis can be achieved by setting three steps 1. First step you have to find and designate a Management Segment for Chart of Accounts 2. Then you have to define Data Access Set to Secure the above designated Specific Management segment values 3. Then you have to assign Data Access Set to Responsibility. That’s all, to make security take effect for that responsibility.Your Navigation should be from Responsibility: General LedgerNavigation: Setup: Financials: Data Access SetsData Access Set and Management segment ValueAs we know in Release 12, data access sets control which ledgers can beaccessed by different responsibilities. Data access sets can also limit a userfrom accessing certain balancing segment values ormanagement segment values or grant read–only or read and write access todata in a ledger.GL automatically creates a data access set when you define a ledger or ledgerset. This system-generated data access set provides full read and write accessto ledgers. You can also provide more limited access to your ledgers and
  20. 20. ledger sets by defining your own data access sets.Oracle General Ledger: New Features in R12Accounting Setup ManagerThe ledger is a basic concept in Release 12. The ledger replaces the 11i concept of a set of books.It represents an accounting representation for one or more legal entities or for a business need suchas consolidation or management reporting. Companies can now clearly and efficiently model itslegal entities and their accounting representations in Release 12. This seems to be a major area ingetting success of the shared service center and single instance initiatives where many or all legalentities of an enterprise are accounted for in a single instance, and data, setup, and processing mustbe effectively secured but also possibly shared.Now, legal Entities can be mapped to entire Ledgers or if you account for more than one legalentity within a ledger, you can map a legal entity to balancing segments within a ledger.While a set of books is defined by 3 C’s, 1. chart of accounts 2. functional currency 3. accounting calendar,The addition in this list the ledger is defined by a 4th C: the accounting method (AccountingConvention).This 4th C allows you to assign and manage a specific accounting method for each ledger.Therefore, when a legal entity is subject to multiple reporting requirements, separate ledgers can beused to record the accounting information.Accounting Setup Manager is a new feature that allows you to set up your common financial setupcomponents from a central location.What is Accounting Setup ManagerAccounting Setup Manager is a new feature that streamlines the setup and implementation ofOracle Financial Applications. The Accounting Setup Manager will facilitate the setup required forsimultaneous accounting for multiple reporting requirements.With the Accounting Setup Manager, you can perform and maintain the following common setupcomponents from a central location: • Legal Entities
  21. 21. • Ledgers, primary and secondary • Operating Units, which are assigned to primary ledgers • Reporting Currencies, which is an enhanced feature • SubLedger Accounting Options. This is where you define the accounting methods for each legal entity SubLedger transaction and associate them to the ledger where the accounting will be stored. • Intercompany Accounts and Balancing Rules • Accounting and Reporting Sequencing • Both Intercompany and SequencingSubLedger Accounting (SLA)As discussed earlier GL is integrated with SLA to enable a unified process to account forSubLedger transactions and post data to GL, and to provide a consistent view when drilling downfrom GL to SubLedger transactions.Enhanced Foreign Currency Processing by Reporting Made easyGL has added new features and enhanced existing features to support foreign currency processing,they are mainly as follows: • In R12, MRC feature is enhanced with a feature call Reporting Currencies. That mean it will now support multiple currency representations of data from any source, including external systems, Oracle or non-Oracle SubLedgers, and Oracle General Ledger journals and balances. • The second one is in reporting to view balances that were entered in your ledger currency separate from those balances that were entered and converted to the ledger currency. The change in R12 is that balances entered in the ledger currency are maintained separately from balances converted to the ledger currency for use in Reporting and Analysis.Here’s an example. Assume we have a ledger and the ledger currency is USD.
  22. 22. I enter and post two journals; one in 1,000 US Dollars, and another in 500 British Pounds that getsconverted to 1200 US Dollars.In Release 11i, I can review the 500 GBP and the 1200 USD that results from converting the 500GBP, and the total 2200 USD which is the USD balance in the Cash Account. The $2200 is thesum of the $1000 entered in USD and the $1200 converted from the 500 British Pounds. However,I view that a 1000 USD were entered directly in USD.In Release 12, I can view the 1000 USD by performing an account inquiry on the Cash account forbalances entered only in the ledger currency. The amounts entered in foreign currencies that wereconverted to the ledger currency will not be included in the balance. Of course, if I want to retrieveall balances in USD, both the entered as well and the converted, I can still do that in Release 12.Creating foreign currency recurring journalsIn Release 11i, you could define recurring journals using the functional currency or STATcurrency.Now in Release 12, you can create recurring journals using foreign currencies. This is particularlyuseful if you need to create foreign currency journals that are recurring in nature. For example,assume a subsidiary that uses a different currency from its parent borrows money from the parent.The subsidiary can now generate a recurring entry to record monthly interest payable to the parentcompany in the parent’s currency.Data Access to Multiple Legal Entities and LedgersYou no longer have to constantly switch responsibilities in order to access the data in a differentledger. You can access multiple ledgers from a single responsibility as long as all ledgers share thesame chart of accounts and calendar.Simultaneous Opening and Closing of Periods for Multiple LedgersYou no longer have to open and close periods for each ledger separately. You can now open andclose periods across multiple ledgers simultaneously by submitting Open and Close Periodsprograms from the Submit Request form.Simultaneous Currency Translation of Multiple Ledgers
  23. 23. You can run the Translation program for multiple ledgers simultaneously, if you are managingmultiple ledgers.Financial Reporting for Multiple LedgersNow with this feature you can run Financial Statement Generator (FSG) reports for multipleledgers simultaneously. This is useful if you manage multiple ledgers and want to run a balancesheet or income statement report for all of your ledgers at the same time.Cross-Ledger and Foreign Currency AllocationsYou are able to allocate financial data from one or more ledgers to a different target ledger. Thisenables you to perform cross-ledger allocations, which is useful for purposes such as allocatingcorporate or regional expenses to local subsidiaries when each entity has its own ledgerStreamlined Automatic PostingYou can now share AutoPost Criteria sets across multiple ledgers that share the same chart ofaccounts and calendar and use the AutoPost Criteria sets to post journals across multiple ledgerssimultaneously.Streamlined AutoReversal Criteria Setup Integrated Web-basedAutoReversal Criteria Sets can also be shared across ledgers to reverse journals across multipleledgers. This is enhanced by integrated Web-based Spreadsheet Interface.Journal CopyNow we can now copy entire journal batches. You can copy journal batches with any status. Thesystem will create a new journal batch containing the same journal entries. You may also changethe batch name, period, and/or effective date while copying the journal batch. After copying thejournal batch, you may modify the unposted journals in the same manner as any manually createdjournals.Streamlined Consolidation MappingsYou are able to define Chart of Accounts Mappings (formerly known as Consolidation Mappings)between two charts of accounts. Therefore, if you have multiple Consolidation Definitions forparent and subsidiary ledgers that share the same chart of accounts pair, and their mapping rulesare the same, you only have to define a single Chart of Accounts Mapping.The enhancement in R12 allows you to define mappings between charts of accounts instead ofbetween sets of books, so that they can be shared across multiple Consolidation Definitions.Therefore, if you have multiple Consolidation Definitions for parent and subsidiary ledgers thatshare the same chart of accounts pair, and their mapping rules are the same, you only have todefine a single Chart of Accounts Mapping.
  24. 24. You can also secure access to chart of accounts mappings using definition access set security. Thisallows you to secure which users can view, modify, and/or use chart of account mappings inconsolidation definitions.Replacement for Disabled AccountsNormally when an account is disabled, you can prevent transactions that include the account fromerroring during journal import by defining a replacement account for the disabled account. Journalimport replaces the disabled account with the replacement account and continue the journal importprocess if the replacement account is valid. This improves processing efficiency by preventing thejournal import process from erroring and enabling the successful creation of the journal withminimal user intervention when an account has been disabled.Data Access Security for Legal Entities and LedgersIn R12, since you can access multiple legal entities and ledgers when you log into Oracle GeneralLedger using a single responsibility, Oracle General Ledger provides you with flexible ways tosecure your data by legal entity, ledger, or even balancing segment values or management segmentvalues. You are able to control whether a user can only view data, or whether they can also enterand modify data for a legal entity, ledger, balancing segment value or management segment value.Management Reporting and SecurityThis can be best understood as: You can designate any segment (except the natural accountsegment) of your chart of accounts to be your management segment and use Oracle GL securitymodel to secure the management segment for reporting and entry of management adjustments.Prevent Reversal of Journals with Frozen SourcesYou can no longer reverse journals from frozen sources defined in the journal sources form.If the journal is created from a frozen source, the journal cannot be modified even if the source issubsequently unfrozen in the future.This provides streamlined data reconciliation with subsystems. Not being able to reverse journalsthat originated in SubLedgers will ensure that the account balances will always tie out withGeneral Ledger. If you need to reverse a SubLedger journal, then you should do so in SubLedgerAccounting or the SubLedger application.Prevent Reversal of Unposted JournalsYou also can no longer reverse unposted journals. This ensures data integrity and betterauditability. In the past when we allowed you to reverse unposted journals, there was a risk that theoriginal journal could be deleted so you could end up reversing something that didn’t exist. Now,all reversals can be tied back to the original posted journal.Integrated Web-based Spreadsheet InterfaceThrough the integration with Web ADI, users can now leverage spreadsheet functionality in OracleGeneral Ledger via a web-based interface. The spreadsheet interface can be conveniently launchedfrom a GL responsibility.
  25. 25. Using the Journal Wizard, we can leverage spreadsheet functionality to create actual, budget, orencumbrance journals. You can take advantage of spreadsheet data entry shortcuts such as copyingand pasting or dragging and dropping ranges of cells, or even using formulas to calculate journalline amounts. You can then upload your journals to Oracle General Ledger. Before uploading, youcan save and distribute your journal worksheets for approval.We can also import data from text files into spreadsheets, where it can be further modified beforeuploading to Oracle. This functionality is useful at the time of migrating data from legacy systems,or from any source that can produce delimited files.Using the Budget Wizard, you can download budget amounts to a spreadsheet, modify theamounts, and then upload them back. You can also choose to download the actual amounts tocompare it with the budget amount. Budget Wizard also allows you to plot graphs and do agraphical comparison on the amounts. Budget Wizard also provides budget notes. You can adddescriptions to accounts and amounts in your budget and explain your budget within the budgetworksheet, avoiding the clutter of external documentation.Control AccountsYou are able to control data entry to an account by ensuring it only contains data from a specifiedjournal source and to prevent users from entering data for the account either in other journalsources or manually within general ledger.Security for DefinitionsYou can secure your setup and definitions by granting specific privileges to users to view, modify,and/or execute a definition. This enables you to control which of your users can view a definition,but not modify or execute it, or execute a definition without modifying it, or vice versa.Following is a list of definitions that have this security available for: 1. Mass Allocation and Mass Budget Formulas 2. FSG Reports and Components 3. Accounting Calendars 4. Transaction Calendars 5. AutoPost Criteria Sets 6. AutoReversal Criteria Sets 7. Budget Organizations 8. Chart of Accounts Mappings 9. Consolidation Definitions 10. Consolidation Sets
  26. 26. 11. Elimination Sets 12. Ledger Sets 13. Recurring Journals and Budget Formulas 14. Rate Types 15. RevaluationsSequence for ReportingMaintaining two sequences have been introduced, accounting and reporting sequencing.Journal Line ReconciliationJournal Line Reconciliation enables you to reconcile journal lines that should net to zero, such assuspense accounts, or payroll and tax payable accounts for countries, such as Norway, Germany, orFrance.In R12, there are many improvements to intercompany accounting. R11i’s Global IntercompanySystem (GIS) has been replaced with an exciting new product called Advanced GlobalIntercompany System (AGIS). Intercompany balancing support has also been extended to includeencumbrance journals.Enhanced IntercompanyAbility to create invoices (AR and AP)Oracle Advanced Global Intercompany System can create invoices in payables and receivables subledger from intercompany transactions.Using Oracle Advanced Global Intercompany System user can enter transactions for multiplerecipients within a single batch. This allows user to submit intercompany transactions from oneinitiator to one or more recipients in a single batch.Proration of transaction distribution amountsWhen user allocates more than one distribution account in a batch that has multiple recipienttransactions, Oracle Advanced Global Intercompany System can automatically prorate thedistribution amounts based on the recipient transaction amounts. The proration of amounts is alsoused by Oracle Advanced Global Intercompany System to adjust the distribution amounts in thebatch when a recipient transaction is deleted or it is rejected.Upload Transaction Batches created in ExcelThis was a missing link in the earlier version, as earlier product does not have capability to usedirect upload functionality, rather than interfacing through Open GIS interface. In Release 12 ADIis heavily used in this module, which is replacement of external integration for AGIS System usingby mean of Microsoft based Excel spreadsheet. Now flexibility is provided to user that cangenerate spreadsheet templates that have features of intercompany entry pages and using the
  27. 27. templates the user can enter transactions in the spreadsheet and upload them into Oracle AdvancedGlobal Intercompany System. The good thing has found the standard templates can be customizedby removing or adding the entry fields from a list of available fields. This feature is used to createa template that contains only the entry fields that are important for the business. The required fieldscannot be removed from the template. Once the templates are generated, user can save them intheir local computer to reuse them in the future. This figure describes the options available in boththe versions.Multiple recipients SupportReversal of batch/transactionThis changed feature enables a user to reverse a whole batch or an individual transaction in abatch. When the user reverses a batch or a transaction, a new reversal batch is created, whichdisplays the references to the original transaction. One point to be noticed is that new batch issubmitted automatically immediately after it is created. Not both the parties (Sender /receiver), itsonly users with access to the initiator organization can reverse its batches or transactions. The setup is there where a user can choose a reversal method determining if the new batch will be createdwith opposite signs, or with switched debits and credits.Descriptive flexfield supportIn AGIS descriptive flexfields is supported on the batch and also on individual transactions withinthe batch. Descriptive flexfields allow user to enter any additional information specific to thenature of business, in the batch and in the transactions. Important to note that these DFF can beused by sender. The user can enter descriptive flexfield information for the recipient in theRecipient Accounting section.Flexible Approval Rules and Workflow NotificationsIn R12, AGIS very similar to other module, home page displays notifications about approval orrejection statuses of intercompany transactions. You should note that notifications can be sent to
  28. 28. the users via email. The rules for approvals and notifications can be customized using OracleApproval Management Engine (AME), which allows the user to add extra approval rules andhierarchies to suit their business needs.Document attachmentThe user can attach the documents for the batch as well as for each of the transaction. When usersubmits the batch, the documents are transferred to respective recipients.Transaction securityIntercompany transactions entry pages incorporate various security features. The user can entertransactions only for those intercompany organizations that are assigned to the user. Other securityfeatures include minimum transaction amount, control amount and function security.For example:Intercompany accountant processes intercompany transactions for many intercompanyorganizations in the enterprise. What is different between these two is : • R11i - Each responsibility has only one subsidiary assigned, therefore a user can initiate intercompany transactions for one subsidiary from each responsibility • R12 – the user can initiate intercompany transactions for many trading partners without changing responsibilityIntercompany PeriodsThe new Intercompany calendar gives the user the option to control intercompany transactionprocessing by periods status.What is observed in this functionality can be best describe as:If a user wants to control intercompany cut-off dates, then the user can choose which GeneralLedger calendar will be used to control transaction entry by intercompany period status.Intercompany Calendar prevents users from entering transactions in closed periods and fromclosing the period if open transactions exist for the period user wants to close. When the user triesto close General Ledger accounting period, or Oracle Payables period or Oracle Receivables periodwhile Intercompany Period is still open, the warning message can be displayed informing userabout the status of intercompany period.Setup Profile OptionsIn AGIS there is no profile option; that means these three as below intercompany profile optionsused in R11i are obsolete in this release. • Intercompany: Protect Receiver Natural Account • Intercompany: Subsidiary
  29. 29. • Intercompany: Use Automatic TransactionIntercompany Reconciliation and ReportingThere are two new reports available in XML Publisher format • Intercompany Transaction Summary report • Intercompany Account Details report.These reports replace reports that were available in the Global Intercompany System (GIS) inRelease 11i.The new reports offer all of the functionality of the obsolete reports plus additional benefits.A bit on these 2 reports:1) Intercompany Transaction Summary report replaces the Intercompany Transaction Detail reportand Unapproved Transaction Listing report.The purpose of this report is to give user a clear overview of intercompany transactions and theirstatuses, there so that day-to-day tasks and speeds up period close activities.This report also provides supporting documentation for intercompany reconciliation and helpskeep intercompany in balance by uncovering any potential discrepancies.2) Intercompany Account Details report replaces the Transaction Activity Summary reportThis new report provides a detailed listing of all accounting lines for intercompany batches,grouped by transaction.The report is divided into two sections: • One section for outbound batches • One section inbound transactions.The outbound section shows transactions initiated by the organizations to which the user has anaccess; the inbound section shows transactions received by these organizations. The user canchoose whether to include inbound, outbound, or both sections in the report.The user can run the report for one or many organizations to which the user is given the access.User can select what parameters like initiator, Recipient, GL Date range, Batch Number range,Transaction Status, Currency, Batch Type, Invoice Number, and many more to run the report by.User can run the report by ranges of initiator and recipient accounts to see what transactions makeup their balances.
  30. 30. Some of the GL Standard Reports converted into XML PublisherOracle General Ledger’s Account Analysis, General Journals and Trial Balance standard reportsare now integrated with XML Publisher.Sequence in GL made legal compliance easyIn R12, to cater the need for legal compliance in some counties of Asia, LatinAmerica, and Europe , two Journal Sequencing options have been provided.These are accounting and reporting sequence, in reality there is bit differencein these two terms.Accounting SequenceThis is sequence used in GL journals when posted in GL, Sequence SubLedgerjournals when completed in SubLedger Accounting.What we have seen in Release 11i, we had document sequencing thatsequentially numbered documents upon creation. Accounting Sequencing willautomatically assign a sequence number to GL journal entries that are postedin GL. There’s also an option to sequence SubLedger journals when they arecompleted in SLA Accounting.Reporting SequenceThis sequence is used in GL Journals when you close a GL Period. Sequencesub ledger Journals when you complete the accounting in SLA .This is one ofreplacement of Accounting Engine (AX) legal sequencing.These two Sequences can be assign mutually exclusive sequences based on: • Ledgers or Reporting Currencies • Journal sources • Journal categories • Balance typesThe benefits of using these sequences are summarized:a) Legal Compliance made easy: The one biggest advantage of it will nowaddresses business requirements in many countries, such as Europe & Asia.Therefore it allows fiscal authorities to verify the completeness of a company’s
  31. 31. accounting records.b) Flexibility get enhanced: With this it provides greater flexibility in choosingdifferent journal sequencing options, as mention above, these can be basedout of these different criteria, such as by ledgers, reporting currencies, journalsources, journal categories, and balance types.c) No Localization Required: Somehow related to (a) discussed above, earlier itthe local reporting need was catered by localization, which now is part of GLactivity.Where to define the sequence?You can define the accounting sequence in the context of a ledger inAccounting Setup Manager. There is another way i.e. Accounting Sequencingmenu function which we can create and manage our sequencing rules.
  32. 32. For Accounting Sequences which is internally a posting event, the GL journals aresequenced when they are posted in GL and SubLedger journals are sequenced whencompleted in SLA. For Reporting Sequences (period close event), GL journals andSubLedger journals are sequenced when a GL period is closed. You can see both canbe appear in the Journal screen as below.
  33. 33. Multi org access controlMultiple Organizations Access Control or MOAC (pronounced MOW-ACK) to usethe seemingly obligatory acronym is a powerful, yet simple to implementfeature available in R12.Implementers spend a lot of time figuring out how to configure their LegalEntities, Ledgers and Operating Units. There are a number of options somerestrictions, depending on what features you want to implement and whereyou are. However it is worth remembering that change is the Status Quo andflexibility is important, what was the optimal way to organize your transactionprocessing yesterday may not be right today. Many companies are creatingshared service centers to centralize processing of financial transactions and asingle user may process transactions on behalf of many different OperatingUnits (OU).So MOAC allows you to create a security group which can contain many
  34. 34. operating units and assign that to the User’s responsibility. All the forms thatprocess OU striped data now allow you to pick an OU to work in from a list thatcontains all the OU you have access to. You will also find all the OU basedreports have a parameter added for OU.The Set Up is straightforward. You can define a security profile in the HRSecurity Profile form, adding Operating Units to it, and then you must runSecurity List Maintenance program before you can assign the security profileto the profile option MO: Security Profile for a responsibility.The most important feature that MOAC provides in Release 12 is the ability tohandle multiple operating units within the same responsibility. This isbeneficial as users don’t have to switch responsibilities in order to change theoperating unit. Often people ask me whether it is possible to use the 11i singleorganization behavior in Release 12; or more importantly whether it is possibleto use a mixture of both.Yes, this is possible. Before knowing how to do that, let us understand howMOAC works in Release 12. MOAC is initialized when you open a Form, OApage or a Report. The first MOAC call checks if the profile “MO: SecurityProfile” has a value. If yes, then the list of operations units to which access isallowed is fetched and the list of values (LOV) is populated. Then default valueof the LOV is set to the operating unit specified in “MO: Default OperatingUnit”. This is how MOAC works in Release 12 when the value of “MO: SecurityProfile” is set.When the profile “MO: Security Profile” does not have a value MOAC switchesto the 11i single organization mode. As in 11i, the profile “MO: Operating Unit”is checked and the operating unit is initialized to the one defined in it.The important point to note here is that the profile “MO: Operating Unit” isignored when the profile “MO: Security Profile” is set. This enables us to useboth Release 12 MOAC behavior and 11i behavior simultaneously in Release12. You can also choose to completely use one of them.Multi Org Access ControlMOAC is new enhancement to the Multiple Organizations feature of OracleApplications.This feature enables user to access data from one or many Operating Unitswhile within a set given responsibility. Due to this change, all processing andsome Reporting in Oracle Payables is available across Operating Units from asingle Applications responsibility. Hence you can isolate your transaction databy Operating unit for security and local level compliance while still enablingshared Service centre processing. Data security is maintained using the
  35. 35. MultipleOrganizationsSecurity Profile, defined in Oracle HRMS, whichspecifies a list of operating units and determinesthe data access privileges for a user.Impact of UpgradeR12 Upgrade does not automatically createsecurity profiles, thus is important if any one wantto use Multiple Organizations Access Control, thefirst things is to define security profiles, then link them to respectiveresponsibilities or users.This new Feature in R12 enables companies that have implemented or implementingshared services operating model to efficiently process business transactions byallowing them to access, process and report on data for an unlimited number ofoperating units within a single applications responsibility. Users are no longerrequired to switch applications responsibilities when processing transactions formultiple operating units.Data security is maintained using security profiles that determine the data accessprivileges associated to responsibilities granted to a user.Because of this you can perform multiple tasks across operating units withoutchanging responsibilities, the simple case can be best described as diagram in theleft, where 3 user from three difference OU’s required three separate responsibility toperform the task.MOAC Benefits.. • Multi-Org Access Control feature allows you to enter, process data and generate reports from a single responsibility • This is achieved by providing the Operating Unit field on the forms/pages and while running the concurrent processes • To Set this feature you need to define the security profile containing operating units and set it at MO: Security Profile • You can default the Operating Unit on forms/pages by setting the MO: Default Operating Unit profileWhat are the new changes?
  36. 36. • As discussed above, security Profiles for data security o MO: Security Profile o List of operating units for a responsibility • OU field on UI o all transactions o setup data specific to OU, like transaction type • Enhanced Multi-Org Reporting and Processing • Ledger/Ledger Set parameter on accounting reports and processes • OU parameter on other standard reports and processes o For example: submit the Payables Open Interface Import w/OU param null to import all records across all OUsWhere and how to define a security profile?Using Oracle HRMS, you can define your security profile using two forms: • The Security Profile form • The Global Security Profile form that is shown here.The Security Profile Form allows you to select operating units from only oneBusiness Group. The Global Security profile Form allows you to selectoperating units from multiple Business Groups.The decision on which form to use is really up to you and depends on your HR
  37. 37. implementation and how you want to partition data. All you need to do is enter aname, and select the Security Type called “Secure organizations by organizationhierarchy and/or organization list”. This allows you to assign multiple OUs. Whenassigning operating units, first select classification Operating Unit, and then select theorganization or Operating Unit name. You can assign as many operating units as youwant.New and changed features in Oracle Assets:Here are the six new and changed features for Oracle Assets in Release 12. • Sub Ledger Accounting Architecture • Enhanced Mass Additions for Legacy conversions • Automatic Preparation of Mass Additions • Flexible Reporting using XML publisher • Automatic depreciation rollback • Enhanced functionality for Energy industryFixed Assets tied with SLA (Sub Ledger accounting)As we have already seen SLA is a rules-based engine for generating accounting entries based onsource transactions from ALL Oracle Applications. Therefore Fixed Asset module does integratedwith such functionality to cater the asset accounting at ledger level. With this feature: • Oracle Assets is fully integrated with SLA, which is a common accounting platform for Sub Ledgers. • Customers can use the seeded Account Derivation definitions or modify them as required. • Continue to support Account Generator functionality for existing Asset Books. • New SLA Accounting report and online account inquiry.What you will notice create Journal Entries (FAPOST) process feeding into the GL_INTERFACEtable is no more exist .This is replaced with the Create Accounting – Assets process (FAACCPB).With this replacement, the some of high point in term of benefits are: • It leads to faster closings: Since there is no requirement of having to close the period, accounting can be created for FA transactions and sent to GL on a continual basis
  38. 38. throughout the period. • There is no need to wait until the end of the month to run Create Accounting in order to get the data to GL.Therefore with this new enhancement allows clients to meet multi-GAAP, corporate, and fiscalaccounting requirements. The tool, Accounting Methods Builder, allows you to determine theaccounts, lines, descriptions, summarization, and dates of your journal entries.This can be best understood as this example, if you do a large amount of asset additions on the firstday of the month, you can run Create Accounting and get all the Cost and Cost Clearing lines overto GL at the close of business that day.Enhancements have been made to the FA_MASS_ADDITIONS table.Now with this enhanced feature, we can populate the values for the new attributes directly in theFA Mass Additions interface table rather than accepting default values from the asset category.Legacy conversion can be completely automated. These are new add-ons: • Asset Life • Depreciation Method • Prorate Convention • Bonus Rule Ceiling Name • Depreciation LimitWhat is understood is that Web ADI has also been upgraded to include the new Attributes. • New columns in the Asset Additions WebAdi • Additional attribute can be used to populate values directly thereby eliminating the need to override the defaults from the Asset Category • These new data fields will benefit data conversion by allowing the converted data to be brought into Oracle with the asset life information.New Automatic Preparation of Mass Additions • This new feature consists of default rules and Public APIs that can be used by customers to complete the preparation of mass addition lines automatically. o Auto populate required fields such as Expense Account, Asset Category etc. o Avoid manual intervention during the Mass Additions prepare process o Avoid customization and use public APIs to effect custom business logic. • Assets now uses Flexible Reporting using XML publisher
  39. 39. o Major Asset Transaction reports have been modified to support XML publisher. o Users can modify or use new templates to view report output.Those who are very new to Asset module must have question, What is meant by DefaultRules? • Asset Category – this is derived from the asset cost clearing account, as long as there is a one to one relationship between the account and asset category. This process will only impact items in the ‘New’ and ‘On Hold’ queue names. • Expense Account – this is derived from the clearing account combination and overlaying the natural account segment with the value of the natural account segment of the depreciation expense defined in the asset category. If the program cannot derive an expense combination, the queue name is set to ‘On Hold’.So what is meant for Consultant by this feature..Please note • This should minimize the amount of manual efforts involved in the Prepare Mass Additions Process. Manual updating is still required some fields may not be populated but are required. • Asset Category – a one to one relationship between cost clearing account and asset category – this will expand the COA of many companies. • Expense Account – the expense combination is going to be derived from a BS account. Oracle will simply overlay the natural account segment, replacing the cost clearing account with the depreciation expense account leaving all other segment values alone. If there are certain requirements for P&L accounts versus BS accounts, i.e. cost center required for P&L, this may present issues. • Manual efforts are required to perform Merging, Splitting, Add to Assets, and Merge Then Split functionality.Flexible Reporting into XML PublisherThese asset reports have been converted in XML Publisher based report. • Create Accounting – Assets • Transfer Journal Entries to GL – Assets • Journal Entry Reserve ledger Report • Asset Additions Report • Asset Transfer Report • Asset Retirement Report • Transaction History Report
  40. 40. • Asset Reclassification Report • Mass Additions Create Report • Mass Additions Posting Report • Cost Adjustment Report • Cost Detail report • Cost Summary Report • Reserve summary Report • Reserve Details Report • Mass Revaluation Preview Report • Revaluation Reserve Details Report • Revaluation Reserve Summary Report • CIP Capitalization report • CIP Detail Report • CIP Summary ReportYou can design and control how the report output will be presented in separate template files.Publish in PDF format that can support colors, images, font styles, headers and footers, and otherformatting. You can create new report templates, or modify existing templates to view your reportoutput.Automatic Depreciation RollbackDepreciation is rolled back automatically by the system when any transaction is performed on anasset if the following conditions are met: • Depreciation has been processed in that period • The period is not closedThat mean, it is no longer required to run depreciation rollback program manually as we have seenin release 11i.Depreciation rollback is executed only on select assets as required and not on the entire AssetBook this enhances performance of the program.Since release 11i, users have been able to run depreciation for an asset book without closing theperiod. If additional adjustments are required in the current period, then the user submits a processto roll back depreciation for the entire book; performs the necessary adjustment(s) and thenresubmits the depreciation program. In Release 12 the intermediate manual step of rolling back
  41. 41. depreciation for the entire book in order to process further adjustments on selected assets is nolonger necessary. As before users may submit depreciation for the entire book prior to closing theperiod. If it becomes necessary to process financial adjustments on one or more assets, the usermay proceed with the transaction normally via the asset workbench or mass transactions.Oracle Assets automatically rolls back the depreciation on just the selected assets (instead of thewhole book) and allows the transaction(s) to be processed normally. The asset(s) for whichdepreciation was rolled back is automatically picked up during the next depreciation run or at thetime that the depreciation period is finally closed.Enhanced functionality for Energy IndustryAs per RCD, this can be understood as; • Energy Units of Production Method for Group AssetsIn the oil & gas industry, asset properties may include fields, leases and wells. These assets aretypically associated with units of production (UOP) and are depreciated using a special UOPdepreciation method. ‘Energy’ assets are generally structured into two levels, group and memberassets, where the group asset is a collection of several members. • Allow Production method for Group Assets • Allow Production upload to Group Assets • Energy Straight line MethodThis feature is used in oil & gas industry, where non-producing assets are depreciated using theenergy straight-line method based on the asset’s net book value. Assets that depreciate using theenergy straight-line method may either depreciate at the member asset level or group asset level.A note on Straight-Line Depreciation – Assets that depreciate using energy straight-line methodmay either depreciate at the member asset level or group asset level. • When at the member level, depreciation is calculated based on each member’s life and then summarized up to the group asset. • When at the group level, depreciation is calculated at the group asset level, the life of the group asset is used. • Net Book Value / Remaining Life • Asset Impairment – this is basically an unplanned depreciation and will utilize this feature to perform asset impairments. Now the ‘impairment’ expense account may be derived from the asset category setup or manually entered.
  42. 42. How Receivables Accounting happen in 11iAs we know the final accounting data is not generated prior to transfer to GL as only distributionlevel information is passed to GL.In 11i, we know three distinct distributions tables, invoices / Credit Memos / Debit Memos have tocapture accounting class & amounts information but not debits & credits. • o Receipts & Adjustments  Unapplied, applied  Both debits & credits o Misc. Cash Receipts  Both debits & credits • As we know “View Accounting” is a report against distributions to see the accounting information.How Payables Accounting happen in 11iWe know that accounting data is generated and stored in “Accounting Events” tables prior totransfer to GL in Payable. Once Transaction get completed it was need to run the “CreateAccounting” process which basically populate data into accounting events tables. Then the actualline information move takes place from accounting events table to General Ledger Tables. Theexisting 11i accounting Process can be best understood by figure below.
  43. 43. SubLedger to Ledger Reporting in 11iIt means complete, final accounting only available in the GL • All debits and credits • All journal entries • All balancesThe only issues in pre R12 versions was to link summarized accounting data with source details.How it is resolved in Release 12 SubLedger AccountingAll sub ledger accounting data generated and stored in shared SLA tables prior to transfer to GL ,and this is achieved by running “Create Accounting” to populate SLA tables(Very similar toPayable events). Once this can be done, users can “View Accounting” only after “CreateAccounting” is run and completed successfully.Transferring Accounting information from AP/AR to GL in R12The Create Accounting process has similar options, you can create accounting in Final or Draftmode and if Final mode is selected, the Transfer to GL parameter can be used to automaticallytransfer the accounting created by the corresponding run. When the Create Accounting processtransfers the journal entries to GL it only transfers the accounting created by the process that callsit. If there is accounting created by the online option = Final or a previous Create Accountingprogram that was not transferred, that accounting will not be transferred. The Transfer JournalEntries to GL program needs to be run separately to transfer any accounting created online orcreated by a previous Create Accounting process that did not transfer the entries.Is/was link an issue in 11i?Yes, From Distributions to SLA
  44. 44. • Create Accounting process • Applies accounting rules • Loads SLA tables, GL tables Creates detailed data per accounting rules, stores in SLA “distribution links” tableSLA Distribution Links Table • Must join through to get true Distribution ==> SLA journals matches • Holds finest granularity of accounting data • Multiple distributions may be aggregated into a few SLA journal linesAnd Final picture looks like:
  45. 45. Welcome to Accounts Payable Release 12:As we learnt during Release 12, the E-Business Suite has couple of newproducts like SubLedger Accounting, E-Business Tax thus significant changeshave been observed in Account Payable data module as some of functionalityis shared by some other products. Thus it is important to understand what isnew. Let us identify some of new changes and underlying impact on theobjects. More details can be found in R12 release documents.Let’s have a dissection view of R12 payable, with some of its core objectsSupplierWe have seen in 11i • Suppliers defined in AP. • Supplier contacts replicated for each supplier site.Where as in R12 • Supplier becomes as TCA Party. • Suppliers Sites as TCA Party Site for each distinct address. • Contacts for each supplier/address , it means Single supplier address and contact can be leveraged by multiple sites, for each OU o A single change to an address can be seen instantly by all OUs o No longer need to manually ‘push’ updates across OUs.This can be best understood by the figure below.
  46. 46. Then the question is what will happen if any one can come from existingfinancial products. The Impact from upgrade can be summarized as:1. When we upgrade supplier tables replaced with backward compatible views.2. One party site for each distinct supplier site addressCountry and address line1 are required, this is because creation of suppliers inParty in TCA data model would requires Country and address information, butit is also understood if there is no country or address line 1 specified for asupplier site in cases when upgrades takes place, Payables derives the countrybased on the most frequently used operating unit of the Supplier’s historicaltransactions.3. Employee as suppliers: address NOT migrated to party site in TCA remainsin Oracle HR for data security reasons.As we know in 11i employees are part of internal supplier’s record in order forOracle Payables to create payments for their expense reports. Employeesdefined in Oracle Human Resources and associated with an Oracle Payablessupplier record have existing party information. During the upgrade, Oracle
  47. 47. Payables updates the existing party information to have a party usage ofsupplier but it does not migrate the employee address to the party site in TCA,they remain in Oracle Human Resources for data security reasons.4. Utilize TCA Party relationships for franchise or subsidiary and its parentcompany.InvoiceTill 11i version, we have seen invoices: • Had only distributions line. • Allocation of freight and special charges are captured at the distribution level only • Tax and payment and Project accounting Payment was captured through global Descriptive Flexfields.But in R12,1. Invoice Lines has a new additional line accommodated in Invoice datamodel.Because of introduction of invoice line there is significant improvement of data flowwith other oracle modules like • Fixed Asset - Asset Tracking • Business Tax - Tax line • Payment - Payment • SubLedger Accounting - Accounting
  48. 48. 2. Allocate freight and special charges are captured to the lines on the invoice3. Invoice distributions created at the maximum level of detail similar to 11i.4. Core functionalityThe impact with Upgrade can be summarized as:1. One invoice line for every distribution in 11i2. Sub Ledger Accounting requires that Payables transform the invoicedistributions to be stored at the maximum level of detail3. Global Descriptive Flexfields migrated to named columns.That means functional testing is more required while upgrade takes place.Banks and Bank DetailsNow a days corporate treasury role has been greatly enhanced thus picking upa global bank as partner for all banking need is demand of time in globalworking model. The recent couple of years have seen drastic increase inacquisition and merger of company thus global working as well as globalinstance get popularity in ERP arena, and this is one of the reasons bank datamodel has been significant changes from 11 to 11i and 11i to R12.Internal Bank AccountsIn 11i we have seen internal Banks defined in AP and that is shared byAP/AR/CE, Payroll and Treasury and they are bank accounts often replicated inmultiple OUsWhere as in R12, • Bank and Branch become part of TCA Parties. • Internal Bank Account in Cash Management which is owned by a Legal Entity. Here the Operating units have granted usage rights.Suppliers Bank AccountsIn 11i • Banks/Branches defined in AP • Bank accounts often replicated in multiple OUs BeforeR12 • Suppliers, Banks and Branches are defined as Parties in TCA • Supplier (party’s) payment information and all payment instruments (Bank Accounts, Credit Cards) moved into Oracle Payments.
  49. 49. The typical data model for bank can be summarized as:Impact of Upgrade1. With Upgrade banks and branches migrated to TCA parties2. Banks merged if the following attributes are all the same: • a. Bank Number b. Institution type c. Country d. Bank admin email e. Bank name alt f. Tax payer ID g. Tax reference number h. Description, Effective dates3. Bank accounts, bank account uses are migrated into cash management.4. Transactions are stamped with the bank account uses identifiers as part ofthe upgrade
  50. 50. Integration with Oracle E-Business TaxIn 11i • Oracle standard functionality was based out of User which determines tax by assigning Tax Codes at line level of invoice and Tax rules was controlled at underline code. • Global descriptive flex fields were captured for country-specific tax attributes. • More importantly most of the setup performed at OU level.In R12 • A new module eBusinessTax determines tax based on facts about each transaction, this is reason why Oracle has introduced additional line information at invoice level. • The module “ebusiness Tax” set and configure Tax rules which can be viewed • Tax attributes collected in fields on key entities • Configure tax rules once per regime and share with your legal entitiesImpact of Upgrade:1. Payables Tax setup, Tax Code defaulting rules defined per OU are migratedto eBusiness Tax.2. OUs migrated to tax content owner in R123. Tax information in tax codes are transformed to Regime-Rate flow.4. E-Business Tax takes information from the AP invoice lines and createssummary and detail tax lines in the E-Business Tax repository.R12 Banking Model:There is one thing that keeps changing since last 2 releases …the bank. Wehave seen there was once from pre 10.x to 11i when supplier bank separatedfrom suppliers data and now its again in R12 when it becomes part of TCA.This time, it is because of changing business need and high demand of globalpartners working model. Not only your company is operating globally, your
  51. 51. partner too is operating global, then why not use them. In typical businesscost model, if corporate office is using Citibank for payroll for USA operationthen why not Citibank Singapore branch is used for payroll for Singapore ifthey are operating there. Sound bit low…why..As we aware the key message of R12 while release was: • Think Globally - using business intelligence and analysis tools • Work Globally - using the global capabilities of the applications • Manage Globally - using the latest system architecture and middlewareSo what, think globally and work globally is factor driving for the changes .Thisrelease has witnessed the great changes ever into the bank model. Now thebank accounts are attached to your legal entity level rather than OperatingUnit in which current and existing versions Offer. This makes bank with strongcapability to pay across operating units. More over it is important tounderstand that banks accounts can be shared by applications and can bedesigned for use by Payables, Receivables and Payroll.What is new in R12 for BankThese changes make easier and more reliable by • Single access point • Single Legal Entity ownership • Usage rights granted to one or more Organizations o Reconciliation option defined at Bank Account level o More flexibility and controlComparing the 11i Vs R12If we compare the bank in 11i with R12, we can notice the bank was utilizedinto three different places, finance, payroll and treasury, which requiresaltogether a different setup. It was one of the big issues with integrationaspect, as significant problem was recognized once the Expense managementand payroll uses same bank for the respective person.There was a common question/confusion between the Integration Existencebetween Bank Data in Accounts Payable and Bank Data in Payroll.As discussed above, you know most of release of 11i family of oracleApplication does not have integration between HR and AP for bank accountdata.
  52. 52. We have noticed in 11i there was functionality in Payables in which we createan employee type supplier from HR data and it will contain name and addressinfo but not bank information. The reason for this is that HR/Payroll does notstore the bank information in a standard way that makes the integrationpossible.So now in R12, this is well taken care and integration is built. There are plansunder way for all bank account data models in the various products to beconsolidated in the new TCA architecture. The Cash Management team isworking on this project. Payables and HR/Payroll are working so that theeventual idea will be that you can set up bank accounts in one place and thenindicate the usage (pay, expense reimbursement, etc).For understanding following is comparison between 11i and release 12, whereTCA community take cares of every things.Release 12, what is new than
  53. 53. Bank Accounts will be stored in a new table called CE_BANK_ACCOUNTS andwill be located at a Bank Branch.The new tables which hold the bank information are as: 1. CE_BANK_ACCOUNT: stores bank account attributes 2. CE_BANK_ACCT_USES_ALL: This stores the bank account use attributes specific to Operating Unit (AR, AP) and Legal Entity (Treasury). 3. CE_GL_ACCOUNTS_CCID: The accounting data pertaining to the bank account use will be stored in the table.This new data model allows the bank and bank branch entities to be definedseparately allowing users to establish a hierarchical relationship betweenthem.Missing link between Supplier And Supplier BanksYou should know • The link between PO_VENDORS and HZ_PARTIES is PO_VENDORS.party_id. • The link between PO_VENDOR_SITES_ALL and HZ_PARTY_SITES is PO_VENDOR_SITES_ALL.party_site_id. • When a Supplier is created Record will be inserted in HZ_PARTIES. When the Supplier Site is created Record will be inserted in HZ_PARTY_SITES. When Address is created it will be stored in HZ_LOCATIONS • When a bank Is Created, the banking information will be stored inIBY_EXT_BANK_ACCOUNTS IBY_EXT_BANK_ACCOUNTS.BANK_id =hz_paties.party_id
  54. 54. • When the Bank is assigned to Vendors then it will be updated in HZ_CODE_ASSIGNMENTS.HZ_CODE_ASSIGNMENTS.owner_table_id =IBY_EXT_BANK_ACCOUNTS.branch_id.Internal Bank Accounts & Supplier and Customer Bank Accounts inR12Internal Bank AccountsIn Release 12, each internal bank account is assigned to a Legal Entity. Any orall operating units associated with that legal entity are permitted to use thatbank account.Supplier and Customer Bank AccountsRelease 12 provides a centralized repository for suppliers’ and customers’bank account and credit card information. All data is stored in one, secureplace, providing shared service centers and collection department’s consistentinformation that they need.What’s new in Oracle Receivables R12:Release 12 of the E-Business Suite is also called the “Global BusinessRelease”, as it has numerous enhancements designed to make it easier to dobusiness on a global basis. A more flexible, centralized global accountingstructure has been introduced which makes it easier to operate between andacross operating units and legal entities. Overall, R12 contains 18 newmodules and 2443 enhancements to existing functionality.Oracle’s Release 12 (R12) of their E-Business Suite continues to extend thefunctionality of the Receivables arena, in addition to incorporated newfinancial architecture and new products , Oracle Receivables is now verynatured product. Let us look at Oracle’s newest/enhanced offerings in OracleReceivables.Revenue RecognitionIn R12 revenue recognition is based on Rules and Events, and they are:
  55. 55. • Time-Based Revenue Recognition o Ratably Over Time o Upon Expiration of Contingencies • Event-Based Revenue Recognition o Payment o Customer Acceptance • Rule-Based Revenue Recognition o Payment Term Thresholds o Refund Policy Thresholds o Customer Credit worthinessLet us take a quick look on some of the new changes: • Daily Revenue Recognition o Revenue distribution over full as well as partial accounting periods. o Fulfills stringent accounting standards o Accuracy to the number of days in the accounting period. • Enhanced Revenue Contingencies : o Fully Supports US GAAP and IAS o User definable contingencies o User definable defaulting rules for contingencies assignment o Supports parent-child (e.g. Product and Service) relationship o Integration with Order Management and Service Contracts o User Interface as well as Programming Interface (API) support o Access control through seeded Revenue Managers Responsibility • Deferred Revenue ManagementEvent-Based Revenue Management in Oracle Receivables allows users todefine revenue deferral reasons or contingencies and corresponding revenuerecognition events. In Release 12, revenue contingencies for customeracceptance that are applied to goods sold in Order Management are now
  56. 56. applied to services sold to cover thosegoods. Revenue is deferred for service ordered inboth Order Management and Service Contracts.Acceptance contingencies associated with an item instance are automaticallyapplied to service revenue associated with the item instance when it iscovered in a Service Contract as a Covered Product. Revenue for services onother covered levels, subscriptions and usage is not impacted bycontingencies applied to goods associated with those services.Global ArchitectureAs we know, with in global architecture, these new things have been introduced. • Sub ledger Accounting - Journal Creation takes place prior to GL. • Bank Model - This unified model enables to park customer Bank as well as Internal bank information into there new model, so that working capital cash flow should be enhanced. • EBusiness Tax - Oracle E-Business Tax is a new product that uniformly delivers tax services to all Oracle EBusiness Suite business flows. In Release 12, Receivables is enhanced to support integration with the E-Business Tax product. • Intercompany - This is enhanced by automatic balancing,MOAC ControlThis enhance you by enabling and performing tasks across operating Units (OUs),where you have access to without changing responsibilities. As we know , MOACenables companies that have implemented a Shared Services operating model toefficiently process business transactions by allowing them to access, process, andreport on data for an unlimited number of operating units within a single applicationsresponsibility.In nutshell, once MOAC is enabled, then you can: • Perform Setups for any OU • Enter invoices across OUs • Receive Cash for any OU • Manage Customer Credit across all OU • Run reports across OUs
  57. 57. Because of thisgreatly enhancedRole based securityoptions, the ability toaccess multipleoperating units with asingle responsibilitycan simplify SOXcompliancemonitoring from finance controller side.Line Level Cash ApplicationsThe Line Level Cash Applications solution allows the application of receipts tospecific transaction items such as individual lines, groups of lines, or tax or freightbuckets. From the receipt workbench, you are able to choose whether to allocatecash to the entire transaction or to apply amounts against specific items according tothe customer remittance. • Apply to specific lines or groups of lines • Indicate when tax, freight or finance charges only are paid • Make changes as needed • Easily view activity against receipts • Know what historical activity affects your receipt • See what prior activity affects a new applicationEnhanced Customer ScreenWe have seen 11i Customer standard forms makes easier by simplenavigation. This times there is clearer separation of the party and accountlayers, which makes a consistent look and feel. Moreover full backwardcompatibility with 11i UI Bill Presentment Architecture has been provided.The AR Create Customer page in R12 has eliminated the navigation toseparate windows. Now, users can specify the following on a single page: • Customer Information • Account Details • Address • Account Site Details
  58. 58. • Business PurposeRefundsOracle Receivables is fully integrated with Oracle Payables to deliver a seamless,automated process to generate check and bank account transfer refunds for eligiblereceipts and credit memos.Late ChargesAs we know oracle receivables delivers enhanced Late Charges functionality enablingthe creation of standard late charge policies that can be assigned to customeraccounts or account sites. Flexible policy configurations include multiple interestcalculation formulas, transaction and account balance thresholds, and currency-levelrate setups. With new changes these are the enhanced functionality: • Expanded assessment and calculation capabilities • Tiered charge schedules • Penalty charge calculation • Integration with Balance Forward Billing • Centralized setup and maintenance of late charge policies • Calculation performed independent of Dunning and Statement processing
  59. 59. AR-AP NettingThe matching of open receivables and open payables is automated.Balance Forward BillingThis makes easy transaction processing.Balance Forward Billing is an enhanced version of the existing consolidated billingfunctionality for industries where customers are billed for all their account activity ona regular, cyclical basis.Balance Forward Billing provides the ability to setup cycle-based billing at the accountor account site levels, enable event based billing, and leverage user configurablebilling formats provided by Oracle Bill Presentment Architecture.A typical case can be best understood as
  60. 60. • Payment Term defaults• from Site profile if Bill Level = Site• from Account profile if Bill Level = Account• Billing Date derived from transaction date and billing cycle• Due Date derived from billing date and payment term• Optionally select non-Balance Forward term if Override Terms = Yes
  61. 61. R12: AP/AR NettingAP/AR Netting automatically compares Payables to Receivables and createsthe appropriate transaction in each system to net supplier invoices andcustomer invoices. With this functionality, a receivables user can • View netted receipt details directly from the receipt • Create Netting Agreements and Netting BatchesWith this functionality, there is significant increase in user productivity andeffectiveness because of tight integration and automation.You can access the process via: • Navigation: Receipts > Netting > Netting Batch • Navigation: Receipts > Netting > Netting Agreement • Receipts > Receipts > Action Menu : AP/AR Netting After Querying a netted receipt, the user can see more details about the batch by selecting AP/AR Netting from the Action menu. This launches the AP/AR Netting batch window. Netted Receipts are created automatically by the AP/AR Netting process and cannot be updated by the user from the Receipts WorkbenchAs we have seen Contra charging has been replaced by AP/AR netting, letstake a setup walk though to use this functionality.1. Define netting control accountSetup>Financials>Flex field>key>values2. Create bankSetup>payment>Bank and Bank BranchesYou should note, Payment document is not required for netting bank account.3. Go to receivables responsibility, receipt class definition formSetup>Receipts>Receipt classQuery the ‘AP/AR Netting’ receipt class which is a seeded one.
  62. 62. 4. Attach your bank account in this receipt class.5. Go to system options, transaction and customer tabbed region,there enable ‘Allow payment of Unrelated Transactions’ check box
  63. 63. 6. Create netting agreementReceipts>Netting>Netting Agreement7. Enter an Invoice in Payables, validate and run create accounting.8. Enter a transaction in receivables.9. Create Netting Batch
  64. 64. Receipts >Netting >Netting Batch10. Query your netting batch and see the status as Complete. alsoclick on view report icon on right side. Click on run push button, youcan see the final netting report.11. Go to view>request>findYou can see 3 concurrent request programs • Create Netting batch • Settle netting batch • Netting Data Extract12. Now go to receipts and query the AP/AR netting receipt.13. Now Go to Tools >view Accounting, you can see Netting controlaccount (defined in first step a) debited and receivable account credited.14. Now go to payables and query your invoice number and click thetab view payments. You can see the payment details and copy thedocument number.15. Query your copied payment document number. What you can seethe payment type as netting.16. Click actions button and enable the check box create accounting.17. Go to tools>view accounting .You can see the accounting entryPosted in Oracle Payable, Release12, R12, Oracle Receivable | 4 Comments »

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