Oracle R12 Sub-Ledger Accounting and Secondary Ledger with an example of set-up.

1. Planning for Sub ledger accounting setup – SLAM for primary and secondary ledger setup
When there is a re-implementing or new implementation of R12 Oracle Financials SLAM (Sub-Ledger
Accounting Method) will be one of the new concepts to understand howeverbefore configuring SLAM
understand howthe high level design of the ledgers, chart of accounts and data sets relate to the setup of SLAM
in relation to primary and secondary ledgers.
Different Business Scenarios may exist:
Scenario 1 – A global business operation with two parent companies one UK parent reporting using IFRS and
one US parent using US GAAP with separate foreign subsidiaries in many countries each with their own
functional currencies.
Scenario 2 – A global business operation with one UK parent reporting using IFRS. This business has separate
foreign subsidiaries accounting in each country each with their own functional currencies.
Scenario 3 – A business operation with one parent company reporting in US GAAP and one separate subsidiary
accounting using a local currency of EUR and the functional currency is US dollars.
Scenario 4 – A UK operation with many subsidiary companies and the parent company reporting in IFRS and
functional currency is UK pounds.
Pre-requisites to ledger and SLAM set up
> assume decisions made on functional currency based on operations and adherence to IAS21
>assume decisions made on multicurrency reporting based on business requirements
>assume decisions made on shared corporate chart of accounts
>assume decisions have been made on primary and secondary ledger use in Oracle based on shared ledger sets
,transaction and accounting chart of accounts and use of multi-org and data access requirements, calendar
requirements and accounting method and currency.
The SLAM set up will vary according to solution but will be something like below:
Scenario 1
This is a typical global business example where more than one consolidation needed and there are many
subsidiary companies. Functional currency is likely to be that of each entity and therefore reporting needs to be
in more than one currency.
Solution a
The many subsidiary entities can share the corporate chart of accounts i.e. the transaction chart of accounts. The
consolidations will need to be performed using secondary ledgers in the two parent entities.
Each subsidiary entity will have its’ own ledger with its’ own currency, calendar and accounting method
however the ledgers will all use the corporate chart of accounts it will be shared across the group.
The corporate chart of accounts has to be able to support the transaction accounting in all entities .

2. Separate currency reports if required are to be utilised for both primary and secondary ledgers.
SLAM will need additional configuration for the secondary statutory reporting ledgers to support the required
level of data conversion e.g. journal.
Solution b
If the corporate chart of accounts cannot support the solution above then the subsidiaries may need to use a
local accounting chart of account and therefore a secondary ledger is required for this chart of accounts.
SLAM can then use additional set-ups so these entities can post the sub-ledger transactions or journal level to
the secondary ledger for internal reporting.
Scenario 2
The solution is as per scenario one but only one consolidation is required.
Scenario 3
In this scenario, the functional currency of the subsidiary and the parent is USD.
Therefore, the subsidiary can use the primary ledger with the corporate or statutory chart of accounts and use the
multi-currency feature of Oracle Financials to report in USD. The local subsidiary can also use the secondary
ledger with their local chart of accounts,local currency EUR for local GAAP.
The consolidation of the subsidiary must be in the primary ledger of the parent. SLAM will need additional
configuration to support the secondary ledger.
Scenario 4
A UK business with one functional currency and one corporate chart of accounts. The Primary ledger of the
entities will use the transaction corporate chart of accounts and functional currency for both will be GBP. There
will be no requirement to report in anothercurrency. There may be a requirement to consolidate to a secondary
ledger with a different chart of accounts. If this is so then the parent entity may set up a secondary ledger to
consolidate the results.
SLAM will need additional configuration to support the secondary ledger.

3. Additional SLAM set ups for use with secondary ledgers
The sub-ledger accounting to secondary ledgers is set at any of the following levels
 Sub-ledger Level Secondary Ledgers
 Journal Level Secondary Ledgers
 Balance Level Secondary Ledgers
 Adjustments Only Secondary Ledger
It is a prerequisite to create a chart of account mapping if the secondary ledger uses a different chart of accounts.
The accounting set up below is an example of the set up in Oracle Financials suitable for scenario 1 solution (a)
in this example a French subsidiary is using the corporate chart of accounts for its’ transactions and mapping
into the US Parent consolidation ledger so they report in US GAAP.
Navigate to accounting set up in Oracle>
Primary Ledger French Operations Secondary ledger US Statutory
Chart of
accounts
Corporate Chart of accounts US GAAP
Accounting
calendar
Monthly Accounting
calendar
Fiscal
Currency Euro Currency USD
Sub-ledger
accounting
method
Standard accrual Sub-ledger
accounting method
USGAAP
Chart of accounts mapping
Currency conversion rules
Error Handling
If missing conversion rate o report error
* Use last rate
Number of days to find last rate 15
Journal conversion Rules
Post journal automatically from source ledger o
Retain journal creator from source ledger no
Data conversion
level
Journal
Disable conversion
date
01-Feb-2013
Corporate to Statutory
mapping
Source representation Source representationFrench operations
Default rate types Corporate
Retain transaction rate
type
Yes
Ledger information