Oracle Presentation

1. <Insert Picture Here>
Overview of the New Financial Architecture in
Oracle E-Business Suite Release 12
Mary Burns

2. The following is intended to outline our general
product direction. It is intended for information
purposes only, and may not be incorporated into any
contract. It is not a commitment to deliver any
material, code, or functionality, and should not be
relied upon in making purchasing decisions.
The development, release, and timing of any
features or functionality described for Oracle’s
products remains at the sole discretion of Oracle.

3. Agenda
• What We Set Out To Address
• Release Twelve: The Global Release
• Global Architecture
• MultiOrg Access Control
• Subledger Accounting
• Ledgers and Ledger Sets
• Ledger Considerations
• Global Business Functions
• Legal Entities
• Accounting Set Up Manager
• E-Business Tax
• Advanced Intercompany
• Banking Model

4. <Insert Picture Here>
What we set out to
address

5. National and International Laws & Regulations
Actions by Competitors
Changing Customer Requirements
Industry Standards and Regulations
Tax Codes
Changing Workforce Attitudes
International Reporting Standards
Language and Cultural Differences
1
Doing Business Globally is Complex
Top Drivers of Complexity
2
3
4
5
6
7
8
Direct impact on Finance
Source: PWC, 9th Annual Global CEO Survey
Globalization is unstoppable.
Regardless of geography, industry or
income, companies are globalizing to
gain new customers and access new
markets. Is this a good thing? Nearly
two-thirds of the CEOs we surveyed
are positive about the impact that
globalization will have on their
organizations over the next three
years.
Source: 9th Annual Global CEO Survey –
Globalization and Complexity; PwC 2006

6. Make it Simpler to do your job
Control Costs by Managing Complexity
50%
Senior
executives say
simplification
is driving the
Finance
agenda
Major Focus
Standardizing operating practices and
controls
69%
Standardizing policies and business
rules
66%
Standardizing and integrating finance
systems
59%
Adopting best practices 58%
Optimizing the finance organization and
its reporting structure
52%
Reducing reliance on spreadsheets 33%
Source: PWC Management Barometer

7. Make it Easier to do Your Job
Transactional Activities
Control Activities
Decision Support, Performance Mgmt
50% Improve processes or
rationalize technologies
60% Standardize policies, rules,
and processes across the
entire enterprise
73% Implement a shared services
model *
80% Adopt best practices or
simplify processes across the
entire enterprise
47%
26%
27%
The Agile CFO, IBM Business Consulting Services, 2005
* Deloitte Consulting, 2006
How Finance Spends its Time % Yet To…

8. Controlled
Transaction
Entry
Comprehensive
and compliant
processing
Transparent
Audit,
Reconciliation
& Drilldown
Easy Reporting
Analytics
Customers:
Centralize, Simplify, Standardize
Work Globally,
to be more competitive
Think Globally,
to make the right decisions
Manage Globally,
to lower cost and increase performance
Financial
Data for
Management
- and
Compliant
National Compliance
Local Regulation
National COA
Local Calendar
Corp. Compliance
US GAAP / IAS-IFRS
Corp COA
Corp Calendar
$
Joint Compliance
US GAAP / IAS-IFRS
Corp COA
Corp Calendar
A$+$
€
Parent Compliance
US GAAP / IAS-IFRS
Corp COA
Corp Calendar
€+$
+

9. WORK GLOBALLY
To Be More Competitive
THINK GLOBALLY
To Make the Right Decisions
MANAGE GLOBALLY
To Lower Cost & Increase
Performance
How Financials Release 12 Can Help
The Global Business Release
Financial Control &
Reporting
Credit-to-Cash
Procure-to-Pay
Treasury & Tax
Performance Management
Profitability Management
Business Intelligence
Integration
Data Management
Reporting
Governance, Risk &
Compliance
Asset Management
Travel & Expense
Global:
1. Of, relating to, or involving the entire earth;
worldwide: global peace; global monetary
policies, etc.
2. Comprehensive; total: a... global, generalized
sense of well-being

10. <Insert Picture Here>
Release Twelve
The Global Business Release:
A New Financial Architecture

11. Global Financial Architecture
Bank
Model
Tax
Engine
Inter
Company
General Ledger
Ledger & Ledger Sets
General Ledger
Ledger & Ledger Sets
Subledger Accounting (SLA)
Dr Cr
Projects
Receivables
Inventory
Work in Process Purchasing Payables
Multi-Org
Access
Control
6 Major Initiatives
1. Ledger and
Ledger Sets
2. Multi-Org
Access
Control
3. Subledger
Accounting
4. Tax Engine
5. Intercompany
6. Bank Model

12. <Insert Picture Here>
Multi-Org
Access Control
Think
Work Manage

13. Responsibility Responsibility Responsibility
Holland
Legal Entity
Denmark
Legal Entity
Belgium
Legal Entity
Functional Tasks
 Order Management
 Dunning, Collections,
Billing
 Requisition, Demand &
Purchase Orders
 Receiving & Drop Ship
 Invoice Receipt,
Disbursement
 Customer Data
Management
 Accounting Setup
Single Responsibility
Belgium
Operating Unit
Holland
Operating Unit
Denmark
Operating Unit
Perform multiple tasks across operating units
without changing responsibilities
MOAC: Multi-Org Access Control
Role based access to Operating Units

14. Purpose Built Cross OU “Desks”
Shared Services
Shared Service Product Reference
Order Management Order Management
Dunning, Collections, Billing Receivables
Requisition, Demand &
Purchase Orders
Procurement
Receiving & Drop Ship Supply Chain Management
Invoice Receipt, Disbursement Payables
Customer Data Management Trading Community Architecture
Accounting Setup Accounting Setup Manager

15. Multiple Organization Access Control
Summary of Changes
• Security Profiles for data security
• MO: Security Profile
• List of operating units for a responsibility
• Defined in HR
• OU field on UI
• all transactions
• 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
• For example: submit the Payables Open Interface Import w/OU
param null to import all records across all OUs

16. Multi-Org Access Control
In practice
Classify
Organization
as operating
unit
Select
Operating Unit
classification
Select
Operating
Units
In daily use
Run Reports
Across
Operating
Units

17. <Insert Picture Here>
Subledger Accounting
Think
Work Manage

18. Projects
Receivables
Payables
3rd Party
Systems
Inventory
3rd Party
Systems
Centralized Accounting Policies
Greater Control, Transparency and Auditability
• Internal control and
compliance with multiple
accounting policies through
user-defined accounting rules
• Single source of truth for all
subsystem accounting
activity with a common data
model and repository
• Accounting, reconciliation
and reporting facilitated by
centralized data model
• Streamline closing process
with common posting engine
• Auditable and transparent
entries accessible with full
drilldown
Centralized Accounting Model,
Rules, Engine and Repository
Dr Cr
General Ledger
General Ledger
Work in Process Purchasing

19. Subledger Accounting
Centralized Rules, Common Repository: Global Control
Payables Invoice
French Rules
Plan Comptable
French Calendar
EUR
Ledger
Subledger
Accounting
Dr Cr
• Faster, Easier
Reconciliation
• Corporate Rules =
Accounting
Standardization
• Local Rules =
Improved Local
Compliance
• Automate “Apples to
Apples” Adjustments
• Improved Audit-
ability
• Improved Internal
Control
Some Benefits
• Accounting Rules
• SarBox & 8th Dir.
• User Editable
• Subledger Daybooks
(Journals)
• Subledger Balancing
• Reports, inquiries, open
items, et cetera
• Multiple
Representations
• Common Posting to GL
Ledgers
• Real time or Periodic
What it is

20. Subledger Accounting
Transaction Level Compliance
Event Class: Invoices
Event: Invoice Approved
Ledger: France (EUR)
GL Date: 20-Sep-2005
Description: Office supplies
Type Account Description Debit Credit
Asset purchase 01.9100010.100 Paris: furniture 10,000
Misc expense 01.9100020.100 Paris: supplies 400
Misc expense 01.9100020.200 Nantes: supplies 100
Misc expense 01.9100020.300 Nice: supplies 300
VAT 01.3100060.000 VAT@17% 1,836
Accounts Payable 01.7000010.000 ABC Supplies 12,636
12,636 12,636
• National Daily Journal Requirements
• Internal Control: Central Definitions, Eliminate overrides
• Policy Enforcement in Volume Processing
• Transparent Accounting Rules
• Debits & Credit at the point of the event
• Automate Foreign Operation adjustments
• Reconciliation
Platform
• “In accordance
with the
Underlying
Records”

21. Opening
Balance Debit Credit
Closing
Balance
SUBLEDGER ACCOUNTING
Receivables
Customer One 250,000 150,000 400,000 -
Customer Two 350,000 250,000 450,000 150,000
Customer Three 100,000 1,500,000 1,400,000 200,000
Customer Four 100,000 800,000 750,000 150,000
Customer Five 200,000 300,000 500,000 -
Total 1,000,000 3,000,000 3,500,000 500,000
Payables
Vendor I (250,000) 1,000,000 900,000 (150,000)
Vendor II (100,000) 75,000 50,000 (75,000)
Vendor III (150,000) 725,000 775,000 (200,000)
Vendor IX (250,000) 1,000,000 975,000 (225,000)
Total (750,000) 2,800,000 2,700,000 (650,000)
Opening
Balance Debit Credit
Closing
Balance
GENERAL LEDGER
Cash 100 3,500,000 2,750,000 750,100
Receivables 1,000,000 3,000,000 3,500,000 500,000
Inventory 500,000 1,200,000 1,500,000 200,000
Assets 100,000 100,000
Prepayments 1,000 1,000
Payables (750,000) 2,800,000 2,700,000 (650,000)
Accruals (250,000) 50,000 (300,000)
Shares (100,000) (100,000)
Previous Results (501,100) (501,100)
Balance Sheet - 10,500,000 10,500,000 -
Sales 3,000,000 (3,000,000)
COGS 1,500,000 1,500,000
R&D 300,000 300,000
S&M 300,000 300,000
G&A-Fin 300,000 300,000
G&A-IT 150,000 150,000
G&A-HR 150,000 150,000
Period Income 300,000 300,000
Income Statement - 24,000,000 24,000,000 -
Ticked & Tied
General Ledger
SLA Detail
SLA Controls that
GL Balances and
SLA Balances tie,
and that both tie
to the document
(invoice, payment, etc.)
sources

22. US GAAP
US COA
US Calendar
EUR
Ledger B
French Rules
Plan Comptable
French Calendar
EUR
Ledger A
Multiple Accounting Representations
Global Compliance – Statutory and Stock Market
Subledger
Accounting
Single subledger
transaction
can create multiple
accounting
representations
and in multiple
currencies
Dr Cr
Payables Invoice
Chose to use an
alternative Ledger -
or just an Adjustment
Ledger or segment
or
Multiple Ledgers

23. SLA keeps the Subledgers & GL tied out
Keep the auditors happy!
GL
Journal
Entries
and
Balances
Transactions
(& adjustments)
Subledger
Applications
Accounting
Events
Reconciled:
Docs, SLA, GL in synch
Accounting
Configurations
Journal Entry
Setup
Accounting
Program
Subledger
Journal
Entries
Subledger
Balances
Subledger Accounting
Service
General
Ledger

24. <Insert Picture Here>
Ledgers and Ledger Sets
Think
Work Manage

25. Ledger
One Repository of Financial Truth
US GAAP
US COA
US Calendar
EUR
Ledger B
Reporting Currency
Implements the 4 C’s:
Accounting Method
Chart of Accounts
Calendar
Currency
The balance on Creditors (COA)
is 4.2M Eur (Currency)
on March 31, 2006 (Calendar)
according to IAS/IFRS definitions (Accounting Method)

26. Ledger Sets
Global Information At A Glance
US GAAP
US COA
US Calendar
EUR
Ledger B
French Rules
Plan Comptable
French Calendar
EUR
Ledger A
Reporting Currency

27. Ledger Sets
Global Information At A Glance
Ledger Set
Key benefits to many Ledgers in one set
• Decision-driving business information always available
• Simpler processing and General Ledger management
• Data and definitions that can be shared and secured
US GAAP
US COA
US Calendar
USD
Ledger C
US GAAP
US COA
US Calendar
EUR
Ledger B
French Rules
Plan Comptable
French Calendar
EUR
Ledger A
Share:
Chart of Accounts
Calendar
Ledger D
Reporting Currency
US GAAP
US COA
US Calendar
AUD

28. Currency in Release 12
• Transaction Currencies
• Accounting Currency in Primary Ledger
• Reporting Currency in Primary Ledger
• More Accounting Currencies in Secondary Ledgers
• For every transaction OR
• For SLA Posting level / GL activity level
• Balance level Translation or Remeasurement in
Ledgers – within Ledger sets, run at one click
• Balance & Activity level Translation or
Remeasurement in Financial Consolidation Hub
• Enhanced Revaluation
• [Functional Currency term dropped: conflicts with IAS 21 / FAS 52]

29. Data Access, Definition Access
• Data Access Sets
• Grant and tailor access to Ledgers and Balancing Segment
Values (i.e. Companies, Stores, Branches, etc.)
Accountant
Privileges
France Ledger
Canada Ledger
US Ledger
GL Manager
View Write
• Definition Access Sets – separate from data security
• Share, restrict definitions; privileges to view, modify, etc.

30. <Insert Picture Here>
Ledger Considerations

31. Ledger Sets – Work them your way
Corporate
Ledger Set
adjustments
eliminations
UK Ledger Set
US Ledger Set
Legal Ledger
UK1
Legal Ledger
UK2
Adj Ledger
Corporate
Adjustment
Ledger UK
Adjustment
Ledger US
Legal Ledger
US1
Legal Ledger
US3
Legal Ledger
US2
Management
Ledger Set
• Automate GAAP / IAS
adjustments in an adjusting ledger
• Eliminate within a Set with GCS
• Consolidate Formally in FCH
• Map from a non-conforming COA
with a GCS Ledger
• Set of 26 Ledgers in one country
• Euro Zone in One Ledger Set
• My Corporate Set in US GAAP
• Statutory Set for Country Y Subs
• Division X Worldwide Ledger Set

32. When to use a Secondary Ledger, an
Adjusting Segment or an Adjusting Ledger?
Adjusting
Segment
Adjusting
Ledger
Secondary
Ledger
Corp. wants GL balances
per Parent GAAP
Corp. wants “Just the
adjustments, thank you”
Corp. wants a complete
Parent GAAP & Currency
edition of the Sub’s books
Subsidiary books are
pretty similar to parents
Mapping gets us most of
the way to Parent
Subsidiary books are quite
alien to parents
No inventory
Inventory is the big
difference
Inventory is one of the big
differences
National chart of accounts
is clearly related to IAS
IFRS or GAAP balances
Manageable series of
reclassifications
National chart of accounts
is radically different from
corporate
National Controllership
- Corp GAAP known
Regional Controllership
- Corp GAAP administered
Parent Controllership
Mexico plant, US parent
Balances are enough
(Full drill down available)
See they’ve been properly
adjusted to our rules
Every petty cash slip

33. <Insert Picture Here>
Global Business
Functions
Think
Work Manage

34. Legal Entity: Your Registered Companies
Legal Authorities
Countries, States, Local,
Agencies, Taxation,
Registrars, Regulators...
Legal Entities
Registered Companies,
Funds, Partnerships…
Inc. LLC. Ltd. SA. GmBH. Etc.
“exist in the outside world”
Management Orgs
Divisions, LOBS, Plants,
Cost Centers, Whatever =
“Decision Making Tags”
Regulates
Managed & analyzed by
Public
Company
(ultimate parent)
Public
Company
Subsidiary
Company
(regional parent)
Subsidiary
Company
(business parent)
Subsidiary
Company
Subsidiary
Company
Subsidiary
Company
Subsidiary
Company
Subsidiary
Company
• Parent companies (LEs) “own or
control” subsidiaries (LEs)
• No outside ring - must pick an LE
• LEs create commercial
transactions
Complies

35. LEs: Why and What?
• LEs pay the taxes
- need tax registrations
• Trade between LEs
needs intercompany
• LEs own the money
and bank accounts
• LEs file the accounts,
take care of accounting
• LEs comply with
whatever needs
compliance: “legal” in LE
Why We Care
• Addresses, Officers, etc.
• Enabled First Party
stamp
• Added Establishments:
map Registrations to
Authorities
• GRE/LE not touched
• Authorities as TCA
parties
• LE Configurator
What we’ve done

36. Setup and maintain: Legal Entities, Establishments, Jurisdictions, Legal Authorities, Legal Addresses
Tabulate your Registered Companies
and other forms of LE

37. Where LE fits in…
Transaction
Taxes -
Complies &
Files, Pays
Actual Registered
Companies, etc.
Et Cetera, 11i
Maintains
its Subledger
Documents
in many OUs
Default Legal
Context (DLC)
Accounts
for itself
in a Ledger
or BSVs
Legal
Entity
Ledger
Business
Group
GRE/LE
Operating
Units
Registrations
with Authorities
Files
Files
Establishments
Registrations
with Authorities
Legal Entity:
Vehicle for compliance
Exists
Locally

38. Transaction
Taxes -
Complies &
Files, Pays
Actual Registered
Companies, etc.
Et Cetera, 11i
Maintains
its Subledger
Documents
in many OUs
Default Legal
Context (DLC)
Accounts
for itself
in a Ledger
or BSVs
Legal
Entity
Ledger
Business
Group
GRE/LE
Operating
Units
Registrations
with Authorities
Files
Files
Establishments
Registrations
with Authorities
Exists
Locally
Legal Entity:
Vehicle for compliance
Get the LE Right
Compliance Falls Into Place
Let’s put LEs to work
• Isolate legal compliance from management needs
• Track your registered companies
• Make your compliance flow more easily
Accounting Setup Manager
Assign books, bookkeeping rules and currency management
to your registered companies
EBusiness Tax
Have your registered companies calculate, file, and pay the
transaction taxes they owe
Intercompany
Do business between and across your registered companies
with full legal documentation
Bank Model
Have your registered companies use their money to pay
their bills, et cetera

39. <Insert Picture Here>
Accounting Setup
Manager (ASM)
Think
Work Manage

40. Define Multiple Ledgers
for Rules & Currencies
Define Legal Entities
& Associated Rules
One Place to manage
Your Global Accounting
Rules, Currencies,
Ledgers,
And Ledger Sets
Set Accounting Rules
for All EBS Apps
Ensure Complete
& Accurate
Setup via Online Checklist
Centralized Set-up
Accounting Setup Manager

41. <Insert Picture Here>
E-Business Tax
Think
Work Manage

42. Automation
• Tax content for certain countries
• Vertex and Taxware integration for U.S.
• Integrity checks during setup process
Constant Changes in
Tax Laws and
Regulations
• Date effective setup
• Tax rules flow for change or creating rules
• Tax simulator for setup, rules, and transactions
Business Needs Solution
Local Compliance
• Tax registrations and tax reporting codes
• Tax lines determine applicable taxes
• Configurable tax reporting templates
Centralized Global Tax
Less Complex Global Tax Compliance
Information Visibility
• Single set up for all Oracle applications
• Use of E-Business Suite components such as trading partner geography,
trading partner classification, legal entity, inventory item categorization,
and accounting event.

43. Tax
Transactions
Taxes,
Rules
Oracle E-Business Tax
Processing taxes for transactions and reporting
Determine
Regimes
Taxable
Basis
Calculate
Tax
Amount
Tax Status
& Rate
Applicable
Taxes
Single Interface for Transactions
Transparent Integration with Tax Partner Services
Parties
Places
Products
Processes
Payables
Receivables
Purchasing
Transactions
Sales Orders
…
Tax Reports
- PDF, HTML, RTF
- Security enabled
 Extensible  Service Oriented Architecture
 Compliance, Assurance  Efficiency, Global Visibility

44. <Insert Picture Here>
Advanced Intercompany
(AGIS)
Think
Work Manage

45. Web UI
Open
Interfaces /
API
Excel
(Web ADI)
Advanced Global
Intercompany
System Subledger
Invoices &
Documents
 Generate subledger invoices
 Control transaction entry with
Intercompany Calendar
 Fully Configurable Approval Rules
 Flexible Security Model
 Centrally defined Intercompany
Accounts
Online
Reconciliation
Reporting
XML
Publisher
Reports
Advanced Global Intercompany System
Address the Top Barrier to a Fast Close
Subledger
Accounting
Dr Cr
General
Ledger Receivables Payables

46. Inter
Company
AGIS at Work
Rebilling a Corporate Cost from an USA HQ
California
Company
New York
Company
Illinois
Company
Italy
Company
France
Company
Subledger
Invoices &
Documents
General
Ledger Entries
• GL Entries created for
US subsidiaries
• AP and AR Invoices
created for France
and Italy

47. <Insert Picture Here>
Banking Model
Think
Work Manage

48. • Bank account is now
associated with LE entity
rather than Operating Unit
• Single bank account serves
multiple Operating Units
• Any and all Operating Units
associated with a ledger can
be permitted to use the
bank account
Assets
Projects
Receivables
Payables
Purchasing
Projects
Receivables
Payables
Inventory
Plus
 Centralized Credit Card Model
 Credit Card Encryption
 Supplier & Customer Banks in TCA
Centralized Banking
Shared Services Disbursements
Work in Process
LE
OU A OU B OU C

49. Bank Model: Example of What You Can Do
Pay invoices from different OUs with 1 instruction
OU A
OU B
OU C
Bank
Single
Payment
Instruction
Invoices
Payments
Sub Ledger
Accounting
• New Payments Module
• New Bank Model
• New Bank & Credit Card
Features

50. Banks
Legal Entity
Operating Units

51. <Insert Picture Here>
Sharing Services
Think
Work Manage

52. Shared Service
Infrastructure
(Serves Informal and Formal)
Organizational Access
Cross Org Processes
Banking Model
Inter Unit Accounting
All Together: Easier To Share Services
Central processing, Distributed impact
SSCs
(Formal)
SLAs & Tax
Inter-LE
Formal SSCs
At home or overseas
Call Centers, Outsourcing
Offshoring, SAS 70,
On Demand
Informal Service Sharing
Process Efficiency
Decentralized Depts.
Centralized Depts..
Normal Business
Practice
Ledgers & Ledger Sets
Ledgers with
Balancing Segments
MOAC across OUs
Intercompany
Bank Model
Tax
Ledger and Ledger Sets
Subledger Accounting
Intercompany, Tax Engine
MOAC across LEs, Bank
Internal Controls Manager

53. • Work Globally
• Global Order Desk
• Global Procurement
• Global Billing
• Global Dunning
• Think Globally
• Global Ledger Sets –
worldwide insight
• Global Reporting
• Manage Globally
• Global Accounting
Rules
• Global Set-up
• Global Integration
What the Architecture Gets You
Release 12 Subsidiary LEs….
…account for themselves in Ledgers, and…
Ledger Set
Company Company
Company
Projects
Receivables
Inventory
Work in Process Purchasing Payables
Multi-Org
Access
Control
manage their subledger data in Operating Units

54. Share Services, maintain privacy
Exploit Cross-OU Processes
Yesterday: An LE Group in 1
SoB with 1 OU - no partitioning R12: Introduce partitioning
without sacrificing processes
Assets
Projects
Receivables
Payables
Purchasing
Projects
Receivables
Payables
Inventory
Work in
Process
Ledgers in
Ledger Sets,
New OUs
MOAC
Inventory
Work in
Process
Assets
Projects
Receivables
Payables
Purchasing
Projects
Receivables
Payables
Inventory
Work in
Process

55. MOAC,
+300 Features
SLA,
Tax
Ledger Sets,
Ledgers
XML Publisher
Reporting
Profitability Mgr,
EPB
Subledger
Release 12: The Global Business Release
Work Globally,
to be more competitive
Think Globally,
to make the right decisions
Manage Globally,
to lower cost and increase performance
DBI, FCH
Intercompany,
Bank, Payments
General
Ledger
Transactions
OICM
TCA, LE
National Compliance
Local Regulation
National COA
Local Calendar
Corp. Compliance
US GAAP / IAS-IFRS
Corp COA
Corp Calendar
$
Joint Compliance
US GAAP / IAS-IFRS
Corp COA
Corp Calendar
A$+$
€
Parent Compliance
US GAAP / IAS-IFRS
Corp COA
Corp Calendar
€+$
+

56. Q U E S T I O N S