This document summarizes the key processes and accounting entries for managing foreign currency revenue in an Oracle projects implementation. It includes an example of a foreign currency project covering customer invoicing, revenue recognition, and clearing unbilled receivable balances. It also outlines the required Oracle modules, configuration changes to the projects and general ledgers, and information flows to support foreign currency revenue and accounting.

1. Oracle Projects
Foreign Currency Revenue & Invoicing
Processing and Accounting Procedures
FX Project Revenue Solution Design

2. Overview
 Oracle Revenue & Invoicing Modules
 Architecture
 Information Flow
 Foreign Currency Project – An Example
 Customer Billing: Projects to Receivables Flow
 Sales Invoices: Receivables to General Ledger Flow
 Customer Receipts: Receivables to General Ledger Flow
 Project Funding Revaluation – Projects Internal Flow:
 Revalue the Base Currency Project Funding Amount
 Revenue Recognition: Projects to General Ledger Flow
 Managing Project Balances for Unbilled Receivables &
Unearned Revenue:
 Manual FX Adjustment Entry
 System Configuration Requirements

3. Oracle Modules: Architecture & Flow
Banks
Oracle General Ledger
(Main Ledger)
Sales Invoices
&
Customer Receipts
Revenue Generation
&
FX Adjustments
Key:
Internal to Oracle Apps
Outbound from Oracle Apps
Inbound to Oracle Apps
Customer
Receipts
Print
Invoices
Customer
Invoices
Customer Invoice
Generation
Oracle Receivables
(Sub-Ledger)
Oracle Projects
(Sub-Ledger)
Oracle Applications

4. Oracle Modules: Information Flow
 Projects generates customer invoices
 Projects transfers customer invoices to Receivables
 Receivables prints customer invoices
 Receivables applies customer payments
 Receivables transfers accounting data to General Ledger for:
 Customer Accounts Receivable Debtor account
 Cash in the Bank account
 Foreign Exchange Gain or Loss due to Cash Application
 Projects transfers accounting data to General Ledger for:
 Revenue Generation
 Foreign Exchange Gain or Loss Adjustment for Closed Foreign
Currency Projects:
 Clearing Unbilled/Unearned Balances

5. Foreign Currency Project - Example
 Project XXXX
 Content: Provision of Equipment
 Duration: Three Months
 Value in Project Currency: €1,000,000
 Original Value in Base Currency: $1,540,000
 Original FX Rate Used ($ / €): $1.54
 1st Invoice – Month #1:
 €500,000 @ FX Rate $1.54 $ 770,000
 2nd Invoice – Month #2:
 €500,000 @ FX Rate $1.52 $ 760,000
 Total Invoice Value in Base Currency: $1,530,000
 Revenue Generated – Month #3:
 €1,000,000 @ FX Rate $1.55 $1,550,000

6. Foreign Currency Project - Example
 Customer Billing: Projects to Receivables Flow
 1st Invoice – Month #1:
 €500,000 @ FX Rate $1.54 $ 770,000
 2nd Invoice – Month #2:
 €500,000 @ FX Rate $1.52 $ 760,000
 Total Invoice Value in Base Currency: $1,530,000

7. Foreign Currency Project - Example
 Sales Invoices: Receivables to General Ledger Flow
 1st Invoice – Month #1:
 €500,000 @ FX Rate $1.54 $ 770,000
Sign Account Entered Value: € Converted Value: $
DR Accounts Receivable 500,000 770,000
CR Deferred Income 500,000 770,000

8. Foreign Currency Project - Example
 Sales Invoices: Receivables to General Ledger Flow
 2nd Invoice – Month #2:
 €500,000 @ FX Rate $1.52 $ 760,000
Sign Account Entered Value: € Converted Value: $
DR Accounts Receivable 500,000 760,000
CR Deferred Income 500,000 760,000

9. Foreign Currency Project - Example
 Customer Receipts: Receivables to General Ledger Flow
 1st Invoice Paid – Month #2:
 €500,000 @ FX Rate $1.52 $ 760,000
Sign Account Entered Value: € Converted Value: $
DR Cash in Bank 500,000 760,000
CR Accounts Receivable 500,000 770,000
DR Foreign Exchange: LOSS 10,000

10. Foreign Currency Project - Example
 Checkpoint @ Month #2: General Ledger Account Balances
Action and Value Base Currency Value
Invoices: €1,000,000 $1,530,000
Payments: € 500,000 $ 760,000
Sign Account Balance: € Balance: $
DR Accounts Receivable 500,000 760,000
DR Cash in Bank 500,000 760,000
DR Foreign Exchange: LOSS 10,000
CR Deferred Income 1,000,000 1,530,000

11. Foreign Currency Project - Example
 Project Revenue: Projects Internal Flow
 Execute Funding Revaluation – Month #3:
 €1,000,000 @ FX Rate $1.55 $1,550,000
 Revaluated Funding:
 Base Currency Value: $1,550,000

12. Foreign Currency Project - Example
 Project Revenue: Projects to General Ledger Flow
 Generate Full Project Revenue – Month #3:
 €1,000,000 @ FX Rate $1.55 $1,550,000
Sign Account Base Currency Value: $
DR Unbilled Receivables 20,000
DR Deferred Income 1,530,000
CR Revenue 1,550,000

13. Foreign Currency Project - Example
 Project Revenue: Explanation of General Ledger Accounting
Entries
 Base Currency Value of Project Revenue: $1,550,000
 Base Currency Value of Project Invoices: $1,530,000
 As Base Currency Value of Project Revenue is greater
than Base Currency Value of Project Invoices, Revenue
Generation will perform the following actions:
 Clear Balance of Deferred Income in Full $1,530,000
 Post Remaining Revenue Balance to:
 Unbilled Receivables $ 20,000

14. Foreign Currency Project - Example
 Checkpoint @ Month #3: General Ledger Account Balances
Action and Value Base Currency Value
Invoices: €1,000,000 $1,530,000
Payments: € 500,000 $ 760,000
Revenue: €1,000,000 $1,550,000
Sign Account Balance: € Balance: $
DR Accounts Receivable 500,000 760,000
DR Cash in Bank 500,000 760,000
CR Revenue 1,000,000 1,550,000
DR Unbilled Receivables 20,000
DR Foreign Exchange: LOSS 0 10,000
n/a Deferred Income 0 0

15. Foreign Currency Project - Example
 Project Adjustments: Managing Outstanding Balances
for Unbilled Receivables & Unearned Revenue
 The project is 100% billed and 100% revenue generated in €
resulting in the following values in the Base Currency:
 Total Invoice Value in Base Currency: $1,530,000
 Total Revenue Value in Base Currency: $1,550,000 *
 Unbilled Receivables Balance to Clear: $ 20,000
* (Note: This is the Revenue value before incorporating
the FX Loss on Cash Application.
Cash Application FX Gain/Loss does not clear
any Unbilled Receivables/Unearned Revenue
Balances)

16. Foreign Currency Project - Example
 Projects Adjustment: Projects to General Ledger Flow
 Clear Unbilled Receivables Balance in Base Currency:
 FX Adjustment: Invoice/Revenue $ 20,000 *
* (Note: This is a Manual Event entered in the Projects
Sub-Ledger distinguished from other events by
being categorised as: “FX Adjustment”)
Sign Account Entered Value: € Converted Value: $
DR Project FX Gain/Loss Adj. 20,000
CR Unbilled Receivables 20,000

17. Foreign Currency Project - Example
 Checkpoint @ Month #3: General Ledger/Sub-Ledger Balances
General Ledger Account Base Currency Value
Final Revenue $1,550,000
Project FX Gain/Loss Adj. $ 20,000
Unbilled Receivables $ 0
Unearned Revenue $ 0
Sign Account Balance: € Balance: $
DR Project FX Gain/Loss Adj. 20,000
CR Revenue 1,000,000 1,550,000
n/a Unbilled Receivables 0
n/a Deferred Income 0
DR Foreign Exchange: LOSS 10,000

18. System Configuration Requirements
 Modify Following Areas of Projects Sub-Ledger
Configuration
 Implementation Options
 Funding Revaluation Includes Gains and Losses
 Revenue Categories:
 FX ADJUSTMENT
 Used for Manual FX Adjustment Event
 Event Types:
 FX Adjustment – Class: Manual
 Project Types
 Revaluate Funding
 Project Templates
 Revaluate Funding

19. System Configuration Requirements
 Modify Projects Sub-Ledger Auto Accounting
Configuration
 In order to process Automated FX Events and to
manage Unbilled/Unearned balances, the following Auto
Accounting Functions need to be modified:
 Function – Event Revenue Accounts:
 Generate Event Revenue based on Revenue
Category Type:
 Pure Revenue Event
 FX Adjustment Event