Oracle Internal & Oracle Academy

Transcription

1 D49298GC10 Edition 1.0 July 2007 D51823 R12 Oracle Financials Functional Migration Fundamentals Student Guide Volume 1

2 Copyright 2007, Oracle. All rights reserved. Disclaimer This document contains proprietary information and is protected by copyright and other intellectual property laws. You may copy and print this document solely for your own use in an Oracle training course. The document may not be modified or altered in any way. Except where your use constitutes "fair use" under copyright law, you may not use, share, download, upload, copy, print, display, perform, reproduce, publish, license, post, transmit, or distribute this document in whole or in part without the express authorization of Oracle. The information contained in this document is subject to change without notice. If you find any problems in the document, please report them in writing to: Oracle University, 500 Oracle Parkway, Redwood Shores, California USA. This document is not warranted to be error-free. Restricted Rights Notice If this documentation is delivered to the United States Government or anyone using the documentation on behalf of the United States Government, the following notice is applicable: U.S. GOVERNMENT RIGHTS The U.S. Government s rights to use, modify, reproduce, release, perform, display, or disclose these training materials are restricted by the terms of the applicable Oracle license agreement and/or the applicable U.S. Government contract. Trademark Notice Oracle is a registered trademark of Oracle Corporation and/or its affiliates. Other names may be trademarks of their respective owners. Author Richard Sears, Dee Fairbanks Simpson Technical Contributors and Reviewers David Barnacle, Melanie Featherstone, Wallace Gardipe, Theresa Hickman, Anant Iyer, Thierry Javelle, Ruth Kukla, Robert Macisaac, Vic Mitchell, Christine Rudd, Kathryn Wohnoutka This book was published using: oracletutor

3 Table of Contents Oracle Financials Overview Oracle Financials Overview Objectives Why R12? Architecture Multi-Org Access Control (MOAC) Subledger Accounting Ledger Ledger Sets Ledger Architecture Legal Organization Enhanced Legal Support Benefits of Legal Entities Oracle E-Business Tax Advanced Global Intercompany System Centralized Banking Bank Model Example Four Ways to Consolidate Information Multi-Dimensional Analysis & Reporting Financial Consolidation Hub Data Management XML Publisher New Standard Reports Other New Features Summary Multi-Org Access Control Overview Multi-Org Access Control Overview Objectives Agenda Multi-Org Access Control Description Multi-Org Access Control Benefits Multi-Org Access Control Process Summary Multi-Org Access Control Setup Multi-Org Access Control Setup Create Operating Unit Multi-Org Access Control Setup Define Security Profile Multi-Org Access Control Setup Run System List Maintenance Multi-Org Access Control Setup Set Profile Options Implementation Considerations Agenda Multi-Org Preferences Description Multi-Org Preferences Benefits Multi-Org Preferences Process Summary Multi-Org Preferences Setup Multi-Org Preferences Setup Add to SubMenu Multi-Org Preferences Setup Set Preferences Agenda Enhanced Multi-Org Reporting Description Enhanced Multi-Org Reporting Benefits Enhanced Multi-Org Reporting Process Enhanced Multi-Org Reporting Process Run Report Guided Demonstration 1 Overview: Using MOAC Guided Demonstration - Using MOAC Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents i

4 Summary Subledger Accounting Overview Subledger Accounting Overview Objectives Agenda Subledger Accounting Subledger Accounting Description Agenda Business Benefits Business Benefits Global Example Business Benefits Business Benefits - Auditability Business Benefits Transaction Example Business Benefits Business Benefits - Accounting Reconciliation Agenda Key Concepts Event Classes Events Transaction Objects and Sources Agenda Major Features Accounting Methods Builder Online Accounting Inquiries Offline Accounting Standard Reports Agenda Setup Setup - Journal Line Type Setup Journal Line Type Setup - Journal Line Type Guided Demonstration 1 Overview: Defining Journal Line Types for Payables Guided Demonstration - Defining Journal Line Types in Payables Practice 1 Overview: Defining Journal Line Types for Payables Practice - Defining Journal Line Types for Payables Solution Defining Journal Line Types for Payables Setup - Account Derivation Rule Setup Account Derivation Rule Setup - Account Derivation Rule Guided Demonstration 2 Overview: Defining Account Derivation Rules for Payables Guided Demonstration - Defining Account Derivation Rules for Payables Practice 2 Overview: Defining Account Derivation Rules for Payables Practice - Defining Account Derivation Rules for Payables Solution Defining Account Derivation Rules for Payables Setup Journal Entry Description Setup Journal Line Definition Setup - Journal Line Definition Guided Demonstration 3 Overview: Defining Journal Lines Definitions for Payables Guided Demonstration - Defining Journal Lines Definitions for Payables Practice 3 Overview: Defining Journal Lines Definitions for Payables Practice - Defining Journal Lines Definitions for Payables Solution Defining Journal Lines Definitions for Payables Setup Application Accounting Definition Setup - Application Accounting Definition Setup Subledger Accounting Method Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents ii

5 Setup - Subledger Accounting Method Ledger Setup and SLAM Assignment Setup Set Key Profile Options Agenda Implementation Considerations Summary Oracle E-Business Tax Overview Oracle E-Business Tax Overview Objectives Agenda What is Oracle E-Business Tax (ebtax) Agenda Business Requirements Met by ebtax Business Needs Solutions Agenda Key Concepts: Tax Authority Key Concepts: Tax Regime Key Concepts: Tax Key Concepts: Tax Jurisdiction Agenda Architecture Overview Agenda Processing Taxes for Transactions Tax Determination Services Example Agenda User Interface Agenda Upgraded and Redesigned Features Upgraded and Enhanced Features Tax Definition Hierarchy Tax Configuration Ownership Practice 1 Overview: Creating a Regime to Rate Tax Model Practice - Create a Regime to Rate Tax Model Solution - Create a Regime to Rate Tax Model Tax Defaulting Hierarchy System Options for Tax Tax Groups Tax Jurisdiction Handling Practice 2 Overview: Creating Tax Zones Practice - Create Tax Zones Solution Create Tax Zones Tax Compounding Tax Inclusiveness Tax Recovery Tax Rounding Tax Overrides Offset Taxes Party Tax Attributes Practice 3 Overview: Creating a First Party Tax Profile Practice - Create a First Party Tax Profile Solution Create a First Party Tax Profile Multiple Tax Registrations Tax Exemptions Tax Exceptions Tax Formulas Global Descriptive Flexfields Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents iii

6 Transaction Tax Upgrade Practice 4 Overview: Creating Transactions with Applicable Tax Practice - Create Transactions with Applicable Tax Solution Create Transactions with Applicable Tax New Features Content and Services Subscription Events and Configuration Owner Options Tax Jurisdictions Tax Rules Practice 5 Overview: Setting Up Tax Rule Defaults Practice - Set Up Tax Rule Defaults Solution Set Up Tax Rule Defaults Fiscal Classifications: Product Fiscal Classifications: Party Fiscal Classifications: Transaction Tax Repository Practice 6 Overview: Creating Tax Accounts Practice - Create Tax Accounts Solution Create Tax Accounts Tax Simulator Practice 7 Overview: Reviewing Tax Configuration Results Using the Tax Simulator Practice - Review Tax Configuration Results Using the Tax Simulator Solution Review Tax Configuration Results Using the Tax Simulator Guided Configuration Profile Options for Tax Upgrade Considerations Implementation Information Summary Oracle General Ledger Oracle General Ledger Objectives Agenda Part Agenda Part Agenda Part Accounting Setup Accounting Setup Benefits Accounting Setup Manager Accounting Setup Manager Benefits Accounting Setup Process Implementation Considerations Practice 1 Overview - Define a Ledger Practice - Define a Ledger Solution Define a Ledger Agenda Part Multiple Currency Support For General Ledger Data From All Sources Multiple Currency Support For General Ledger Data From All Sources Benefits Multiple Currency Support For General Ledger Data From All Sources Process Implementation Considerations Guided Demonstration 1 Overview: Create Accounting Setup Guided Demonstration - Create Accounting Setup Agenda Part Entered Currency Reporting and Analysis Description Entered Currency Reporting and Analysis Description Entered Currency Reporting and Analysis Benefits Entered Currency Reporting and Analysis Setup Agenda Part Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents iv

7 Foreign Currency Recurring Journals Description Foreign Currency Recurring Journals Benefits Foreign Currency Recurring Journals Process Implementation Considerations Agenda Part Data Access to Multiple Legal Entities and Ledgers Description Data Access to Multiple Legal Entities and Ledgers Benefits Data Access to Multiple Legal Entities and Ledgers Process Data Access to Multiple Legal Entities and Ledgers Setup Data Access to Multiple Legal Entities and Ledgers Setup Assign Data Access Set Guided Demonstration 2 Overview: Create Data Access Sets with Read/Write Access Guided Demonstration - Create Data Access Sets with Read/Write Access Implementation Considerations Agenda Part Multi-Ledger Processing Description Multi-Ledger Processing Benefits Multi-Ledger Processing Guided Demonstration 3 Overview: Viewing Ledger Sets Guided Demonstration - View Ledger Set Multi-Ledger Processing Process Simultaneous Opening and Closing of Periods Multi-Ledger Processing Process Simultaneous Year-End Closing Journals Multi-Ledger Processing Process Simultaneous Currency Translation Multi-Ledger Processing Process Financial Reporting Across Ledgers Multi-Ledger Processing Setup Guided Demonstration 4 Overview: Ledger Set Processing Guided Demonstration - Ledger Set Processing Practice 2 Overview: Create a Ledger Set Practice - Create a Ledger Set Solution - Create a Ledger Set Agenda Part Financial Reports Across Ledgers Description Financial Reports Across Ledgers Benefits Financial Reports Across Ledgers Process Financial Reports Across Ledgers Setup Guided Demonstration 5 Overview FSG Reporting Using Ledger Sets Guided Demonstration - FSG Reporting Using Ledger Sets Agenda Part Cross-Ledger and Foreign Currency Allocations Description Cross-Ledger and Foreign Currency Allocations Benefits Cross-Ledger and Foreign Currency Allocations Setup and Process Agenda Part Streamlined Automatic Posting/Reversal Description Streamlined Automatic Posting/Reversal Benefits Streamlined Automatic Posting/Reversal Setup and Process Agenda Part Integrated Web-based Spreadsheet Interface Description Integrated Web-based Spreadsheet Interface Benefits Integrated Web-based Spreadsheet Interface Setup and Process Agenda Part Journal Copy Description Journal Copy Benefits Journal Copy Setup and Process Agenda Part Streamlined Consolidation Mappings Description Streamlined Consolidation Mappings Benefits Streamlined Consolidation Mappings Setup and Process Agenda Part Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents v

8 Replacement for Disabled Accounts Description Replacement for Disabled Accounts Benefits Replacement for Disabled Accounts Setup and Process Agenda Part Management Reporting and Security Description Management Reporting and Security Management Reporting and Security Benefits Management Reporting and Security Setup Agenda Part Data Access Security for Legal Entities and Ledgers Description Data Access Security for Legal Entities and Ledgers Description Data Access Security for Legal Entities and Ledgers Benefits Data Access Security for Legal Entities and Ledgers Setup and Process Guided Demonstration 6 Overview: Entering Journals Using Different Balancing Segment Values (BSVs) Guided Demonstration - Enter Journals Using Different Balancing Segment Values (BSVs) Agenda Part Journal Reversal Enhancements Description and Benefits Journal Reversal Enhancements Setup Agenda Part Control Accounts Description and Benefits Control Accounts Setup and Process Agenda Part Security for Definitions Description Security for Definitions Security for Definitions - Example Security for Definitions Benefits Security for Definitions Setup and Process Guided Demonstration 7 Overview: Defining Definition Access Sets and Secure Definitions Guided Demonstration - Define Definition Access Sets and Secure Definitions Agenda Part Accounting and Reporting Sequencing Description Accounting and Reporting Sequencing Benefits Accounting and Reporting Sequencing Setup and Process Agenda Part Journal Line Reconciliation Description Journal Line Reconciliation Benefits Journal Line Reconciliation Setup and Process Agenda Part Enhanced Intercompany Description Enhanced Intercompany Benefits Enhanced Intercompany Accounting and Balancing Rules Process Enhanced Balancing Process Intracompany Journals Enhanced Intercompany Accounting and Balancing Rules Setup Implementation Considerations Guided Demonstration 8 Overview: Advanced Intercompany Global System Guided Demonstration - Advanced Global Intercompany System Summary Oracle Fixed Assets Oracle Fixed Assets Objectives Agenda Subledger Accounting Architecture Description Subledger Accounting Architecture Benefits Subledger Accounting Process Subledger Accounting Architecture Summary Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents vi

9 Guided Demonstration 1 Overview: Performing Asset Inquiries Guided Demonstration -Perform Asset Inquiries Practice 1 Overview: Performing Asset Inquiries Practice - Perform Asset Inquiries Solution Perform Asset Inquiries Subledger Accounting Setup Agenda Enhanced Mass Additions for Legacy Conversions Description Guided Demonstration 2 Overview: Adding Assets Using Web ADI Guided Demonstration - Add Assets Using Web ADI Practice 2 Overview: Adding Assets Using Web ADI (Optional) Practice - Add Assets Using Web ADI Solution Add Assets Using Web ADI Enhanced Mass Additions for Legacy Conversions Benefits Implementation Considerations Agenda Automatic Preparation of Mass Additions Description Automatic Preparation of Mass Additions Benefits Automatic Preparation of Mass Additions Process Automatic Preparation of Mass Additions Process Guided Demonstration 3 Overview: Automatic Preparation of Mass Addition Lines Guided Demonstration - Automatic Preparation of Mass Addition Lines Automatic Preparation of Mass Additions Setup Automatic Preparation of Mass Additions Setup Quickcodes Agenda Flexible Reporting Using XML Publisher Description Benefits Flexible Reporting Using XML Publisher Setup Flexible Reporting Using XML Publisher Example XML Output Agenda Automatic Depreciation Rollback Description Automatic Depreciation Rollback Benefits Agenda Enhanced Functionality for Energy Industry Description Practice 3 Overview: Setting Up Group Assets (Optional) Practice - Set Up Group Assets Solution Set Up Group Assets Summary Oracle Purchasing Oracle Purchasing Objectives Agenda Part Agenda Part Agenda Part Professional Buyer's Work Center Description Professional Buyer's Work Center Benefits Professional Buyer's Work Center Overview Professional Buyer's Work Center Requisition Management Guided Demonstration 1 Overview: Using Professional Buyer's Work Center Guided Demonstration - Using the Buyer's Work Center Practice 1 Overview: Creating a Purchase Order in the Buyer's Work Center Practice - Create a Purchase Order in the Buyer's Work Center Solution - Create a Purchase Order in the Buyer's Work Center Professional Buyer's Work Center Requisition Management Key Profile Options Implementation Considerations Agenda Part Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents vii

10 Enhanced Catalog Access Description Enhanced Catalog Access Benefits Enhanced Catalog Access Setup Preferences Agenda Part Document Styles Description Document Styles Benefits Document Styles Process Source Document Reference Guided Demonstration 2 Overview: Creating and Using Document Styles Guided Demonstration - Using Document Styles Agenda Part Procurement for Complex Services Description Procurement for Complex Services High Level Business Flow Procurement for Complex Services New Purchasing Features Procurement for Complex Services Benefits Implementation Considerations Agenda Part Multi-Org Access Control Description Multi-Org Access Control Benefits MOAC Effects Forms and Pages Multi-Org Access Control Public APIs Agenda Part E-Business Tax Description E-Business Tax Benefits E-Business Tax Process Tax Calculation E-Business Tax Setup Implementation Considerations Agenda Part Document Publishing Enhancements Description Document Publishing Enhancements Benefits Document Publishing Enhancements Setup and Process Document Publishing Enhancements Setup PDF Template Document Publishing Enhancements Setup RTF Template Document Publishing Enhancements Setup Upload Template Document Publishing Enhancements Process Printing in Procurement Flow Document Publishing Enhancements Process Print Purchasing Document Implementation Considerations Agenda Part Document Attachments Description Document Attachments Benefits Document Attachments Process Document Attachments Setup Document Attachments Setup Define Purchasing Options Agenda Part Oracle Supplier Network Description Transacting Over Oracle Supplier Network Oracle Supplier Network Support Transactions with Purchasing Oracle Supplier Network Benefits Oracle Supplier Network New Features Implementation Considerations Agenda Part Maintain Sourcing Rules/ASLs for Agreement Items Maintain Sourcing Rules/ASLs for Agreement Items Benefits Maintain Sourcing Rules/ASLs for Agreement Items - Define Rules for a Specific Plant Agenda Part Support for Contractor Purchasing Users Description Support for Contractor Purchasing Users Benefits Support for Contractor Purchasing Users Setup Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents viii

11 Support for Contractor Purchasing Users Setup Set Profile Option Implementation Considerations Agenda Part Compliance to Packaging Constraints Description Compliance to Packaging Constraints Benefits Compliance to Packaging Constraints Process Summary Compliance to Packaging Constraints Process Apply Order Modifiers Compliance to Packaging Constraints Process Perform UOM Conversion Compliance to Packaging Constraints Process Perform Quantity Rounding Compliance to Packaging Constraints Setup and Process Implementation Considerations Agenda Part Auto-Approval Tolerances for Change Orders Description Auto-Approval Tolerances for Change Orders Setup and Process Agenda Part EAM Support for Services Procurement Description EAM Support for Services Procurement Setup and Process Additional Considerations Implementation Considerations Agenda Part Model Complex Pricing for Blanket Line Items Description Model Complex Pricing for Blanket Line Items Benefits Model Complex Pricing for Blanket Line Items Setup and Process Model Complex Pricing for Blanket Line Items Pricing Hierarchy Model Complex Pricing for Blanket Line Items Profile Options Implementation Considerations Agenda Part Mass Re-pricing of Purchasing Documents Description Mass Re-pricing of Purchasing Documents Benefits Mass Re-pricing of Purchasing Documents Process Implementation Considerations Agenda Part New User Interface for Oracle Purchasing Setups Description New User Interface for Oracle Purchasing Setups Benefits Agenda Part Advanced Approval Support for Requisitions Description Advanced Approval Support for Requisitions Benefits Advanced Approval Support for Requisitions Parallel Approvals Advanced Approval Support for Requisitions Voting Method Advanced Approval Support for Requisitions Position Hierarchy Support Advanced Approval Support for Requisitions Setup and Process Implementation Considerations Summary Oracle Accounts Payable Oracle Accounts Payable Objectives Practices 1, 2, and 3 Overview: Prerequisite Practices Practice - Create a New Employee (Required) Solution - Create a New Employee (Required) Practice - Create a New User Solution - Create a New User Practice - Set Yourself Up As a Buyer (Required) Solution - Set Yourself Up As a Buyer Agenda Suppliers in the Trading Community Architecture (TCA) TCA Security by Functional Areas Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents ix

12 Payment Banks, Branches, and Accounts Supplier Bank Accounts Collaboration with Suppliers to Resolve Disputes Invoice Requests Implementation Considerations Practice 4 Overview: Creating a Supplier Practice - Create a Supplier With Two Sites Solution - Create a Supplier With Two Sites Agenda Deferred Recoverability Deferred Recoverability Features Deferred Recoverability Benefits Deferred Recoverability Process Part 1: Set Up and Invoice Deferred Recoverability Process Part 2: Set Up and Payment Setup Taxes with Deferred Recoverability Implementation Considerations Agenda Enhanced Asset Tracking Enhanced Asset Tracking Benefits Enhanced Asset Tracking Process Invoice Lines Implementation Considerations Practice 5 Overview: Matching to Purchase Order Practice - Match to Purchase Order Solution - Match to Purchase Order Agenda Payment Requests Key Concepts Payment Requests Description Payment Requests Benefits Payment Requests Process Oracle Receivables Refund Example Funds Disbursement Process- Loans Payment Request Additional Payables Actions Payment Requests: Synchronizing Between Products Payment Requests Reporting Payment Requests Optional Setup Payment Requests Miscellaneous Set up Implementation Considerations Agenda Payment Method Controls and Enhanced Payment Information Key Concepts Evaluate Payment Choices Reporting and Payment Instruction Requirements Enhanced Payment Method Controls Description Enhanced Payment Method Controls Benefits Enhanced Payment Method Controls Process Enter Payables Document Expanded Payment Attribute Availability and Defaulting - Definition Expanded Payment Attribute Availability and Defaulting Description Expanded Payment Attribute Availability and Defaulting - Benefits Expanded Payment Attribute Availability and Defaulting Enter Payables Document Expanded Payment Attribute Availability and Defaulting - Payment Attributes Defaulting Expanded Payment Attribute Availability and Defaulting - UI Practice 6 Overview: Entering Quick Invoices Practice - Enter Quick Invoices Solution - Enter Quick Invoices Configurable Payment Attribute Validation Description Configurable Payment Attribute Validation Benefits Configurable Payment Attribute Validation Invoice: Scheduled Payment Holds Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents x

13 Configurable Payment Attribute Validation Invoice: Invoice on Hold Report Practice 7 Overview: Running Hold Reports Practice - Run Hold Reports Solution Run Hold Reports Configurable Payment Attribute Validation Payment: Payment Processing Choices Practice 8 Overview: Create a Payment Process Request Template Practice - Create a Payment Process Request Template Solution - Create a Payment Process Request Template Configurable Payment Attribute Validation Payment: Payment Processing Choices Practice 9 Overview: Creating a Payment Process Request Practice - Create a Payment Process Request with Straight-Through Processing for a Payment Method of Check Solution Create a Payment Process Request with Straight-Through Processing for a Payment Method of Check Expanded Payment Attribute Availability Payment Instruction Formats and Reporting - Benefits Expanded Payment Attribute Availability Payment Instruction Formats and Reporting Payment Instruction Formats and Reporting XML Publisher Templates Payment Instruction Formats & Reporting XML Publisher Templates Expanded Payment Attribute Availability Payment Instruction Formats and Reporting Formats & Reporting Payment Process Formats and Reporting Payment Process Formats & Reporting Payment Process Formats and Reporting Payment Process Formats & Reporting Payment Process Setup Payment Method Controls and Enhanced Payment Configurable Payment Attribute Validation Setup Configurable Payment Attribute Validation Setup Consideration Configurable Payment Attribute Validation Setup: View Available Validations Configurable Payment Attribute Validation Setup Payment Methods Configurable Payment Attribute Validation Setup: Payment Process Format Configurable Payment Attribute Validation Setup: Payment Process Profile Expanded Payment Attribute Availability Payment Instruction Formats and Reporting Setup Enhanced Payment Method Controls Setup Expanded Payment Attribute Availability and Defaulting - Setup Implementation Considerations Agenda Self Assessed Tax Description Self Assessed Tax Features Self Assessed Tax Benefits Self Assessed Tax Predetermined Process Self Assessed Tax Process 1. Predetermined Self Assessed Tax: Predetermined Process Invoice Entry Self Assessed Tax: Predetermined Process Calculate Tax Self Assessed Tax: Predetermined Process Calculate Tax Example Self Assessed Tax: Predetermined Process Calculate Tax Self Assessed Tax Process Account Self Assessed Tax Setup Reporting Choices Self Assessed Tax Process Report Self Assessed Tax Manual Determination Process Self Assessed Tax Process 2. Manual Determination Self Assessed Tax: Manual Determination Set Up - E-Business Tax Controls Self Assessed Tax: Manual Determination Process Invoice Entry Self Assessed Tax: Manual Determination Process Calculate Tax Self Assessed Tax: Manual Determination Process Calculate Tax Example Setup Self Asessed Tax Self Assessed Tax: Predetermined Set Up First Party, Party Tax Profile Self Assessed Tax: Predetermined Set Up First Party, Party Tax Profile Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xi

14 Self Assessed Tax: Predetermined Set Up Supplier Party Tax Profile Implementation Considerations Agenda Oracle Payables For Complex Contract Terms Oracle Payables for Complex Contract Terms Benefits Complex Contract Terms Key Concepts Oracle Procurement to Payables: High Level Business Flow Integrated Products: High Level Business Flow Oracle e-business Tax Setup: Tax Configuration Business Flow: Payables Distinction Contract Delivery Invoicing Invoice Workbench: Contract Delivery Invoices Oracle Payables: Ensure Billing Compliance Oracle Payables: Tolerances and Holds Oracle Payables: Holds Notification Options Practices 10 and 11 Overview: Placing and Releasing Holds Practice - Place a Hold on an Invoice Solution - Place a Hold on an Invoice Practice - Release Holds Solution - Release Holds Oracle Payables for Complex Contract Terms Benefits Oracle Procurement to Payables: Setup Overview Oracle Procurement Setup Payables Setup: Financial Options Payables Setup Payables Options Payables Setup: Invoice Tolerances Shared Setup: Supplier Terms & Controls Oracle Approvals Management Setup Approval Rules Oracle ebusiness Tax Setup: Tax Configuration Prepayments: Tax Configuration Example Practice 12 Overview: Setting Up US Sales Tax Practice - Set Up US Sales Tax Solution Set Up US Sales Tax Practice 13 Overview: Entering an Invoice with US Sales Tax Lines Practice - Enter an Invoice with US Sales Tax Lines Solution - Enter an Invoice with US Sales Tax Lines Implementation Considerations Agenda Multi-Org Access Control in Payables Description Multi-Org Access Control in Payables Benefits Multi-Org Access Control Process Multi-Org Access Control Process, Invoice Entry Multi-Org Access Control Process, Payment Templates Multi-Org Access Control Process, Controlling Payables Periods Multi-Org Access Control Process, Submitting Concurrent Request Multi-Org Access Control Process, Submitting Standard Report Multi-Org Access Control Process, Open Account Balances Listing Report Multi-Org Access Control Setup Multi-Org Access Control Payables Setup Implementation Considerations Summary Oracle Receivables Oracle Receivables Objectives Practice 1 Overview: Modify Your Responsibilities Practice - Modify Your Responsibilities Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xii

15 Solution - Modify Your Responsibilities Agenda New and Changed Features for Balance Forward Billing Balance Forward Billing Description Balance Forward Billing Benefits Balance Forward Billing Setup and Process Balance Forward Billing Setup Define Billing Cycle Balance Forward Billing Setup Define Payment Term Balance Forward Billing Setup Customer Profile Class Practice 2 Overview: Create a Customer Class Profile Practice - Create a Customer Profile Class Solution - Create a Customer Profile Class Practices 3-7 Overview: Prerequisite Practices Practice - Create a Customer Using the Customers Set of Pages Solution - Create a Customer Using the Customers Set of Pages Practice - Add Customer Details Using the Customers Set of Pages Solution - Add Customer Details Using the Customers Set of Pages Practice - Add Account Details Using the Customers Set of Pages Solution - Add Account Details Using the Customers Set of Pages Practice - Add Account Site Details Using the Customers Set of Pages Solution - Add Account Site Details Using the Customers Set of Pages Practice - Create a Customer Account Relationship Solution - Create a Customer Account Relationship Balance Forward Billing Setup Account & Site Profile Balance Forward Billing Setup Account Level Bill Example Balance Forward Billing Setup Site Level Bill Example Oracle BPA Rules Setup Balance Forward Billing Process Enter Transaction Balance Forward Billing Process Imported Transactions Balance Forward Billing Process Creating Bills Balance Forward Billing Process Generating Bill Logic Balance Forward Billing Use Cases Balance Forward Billing Process Generate Bill Program Balance Forward Billing Process Confirm Bill Summary Balance Forward Bill Example Detail Balance Forward Bill Balance Forward Billing Process BPA Print Program Balance Forward Billing Process Disable Payment Terms Balance Forward Billing Process Change Payment Terms Balance Forward Billing Dependencies and Interactions Balance Forward Billing Functional Upgrade Script Demo 1 Overview: Balance Forward Billing Guided Demonstration - Balance Forward Billing Practice 8: Overview Printing Balance Forward Bills Practice - Print Balance Forward Bills Solution - Print Balance Forward Bills Agenda Credit Card Chargeback Description Credit Card Chargeback Benefits Credit Card Chargeback Process Credit Card Chargeback Process Receive Receipt Credit Card Chargeback Process Record Credit Card Chargeback Credit Card Chargeback Process Validate Credit Card Chargeback Credit Card Chargeback Process Validate Credit Card Chargeback Credit Card Chargeback Process Validate Credit Card Chargeback Credit Card Chargeback Setup Practices 9-11 Overview: Applying and Updating a Receipt at Line Level Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xiii

16 Practice - Create an Invoice Solution - Create an Invoice Practice - Enter a Manual Receipt Solution - Enter a Manual Receipt Practice - Apply and Update Receipt at Line Level Solution - Apply and Update Receipt at Line Level Agenda Legal Entity Background Legal Entity Model Legal Entity Background Legal Entity Description Legal Entities and Accounting Legal Entities and Shared Accounting Legal Entity Description Defaulting for Transactions Legal Entity Description Defaulting for Transactions Legal Entity Description Defaulting for Receipts Legal Entity Benefits Legal Entity Setup and Automated Process Legal Entity Setup Update Transaction Type Legal Entity Setup Update Batch Source Legal Entity Process - AutoInvoice Legal Entity Setup and Manual Process Legal Entity Process Manual Transaction Legal Entity Process On Account Credit Memos Legal Entity Process Bills Receivable Legal Entity Process - Receipts Legal Entity Process Claim LE Defaulting Implementation Considerations Agenda E-Business Tax Receivables E-Business Tax Integration Key Benefits E-Business Suite Tax Prior to Release E-Business Suite Tax Integration Architecture of a Tax Line in E-Business Tax Example of US Sales Tax in Example of UK VAT Tax in Migrating Taxes from 11.5 to Migrating of Tax Codes and Tax Group Codes Use of Tax Rate Codes in Receivables Use of Tax Classifications in Receivables Setting Up New Taxes in E-Business Tax Receivables Specific Tax Setups System Options Customer Tax Transaction Type Receivables Activity Adjustments, Receipt Discounts, and Recoverable Tax Standard Memo Lines Legal Entity and Ship To Transactions and Migrated Taxes Transactions and Migrated Taxes: Key Differences Transactions and New Taxes Transactions and Manual Taxes Implementation Considerations Agenda Subledger Accounting Overview Subledger Accounting Benefits Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xiv

17 Subledger Accounting in Receivables Overview Subledger Accounting in Receivables Benefits Subledger Accounting in Receivables Process Submit Accounting Program Subledger Accounting in Receivables Process Create/View Accounting Subledger Accounting in Receivables Process Online Create Accounting Subledger Accounting in Receivables Setup Subledger Accounting in Receivables Setup Ledgers and SLAMs Subledger Accounting in Receivables Setup Sources for Accounting Definitions Subledger Accounting in Receivables Setup Predefined Event Classes/Types Subledger Accounting in Receivables Setup AR Predefined Event Classes/Types Subledger Accounting in Receivables Setup Anatomy of a Journal Entry Subledger Accounting in Receivables Setup Journal Line Types Subledger Accounting in Receivables Setup Account Derivation Rule Subledger Accounting in Receivables Setup Journal Line Definition of Invoices Subledger Accounting in Receivables Setup Assigning the JLD to the AAD Subledger Accounting in Receivables Setup Assigning the AAD to the SLAM Subledger Accounting in Receivables Setup Assigning the SLAM to the Ledger Subledger Accounting in Receivables Setup Predefined SLAMs Subledger Accounting in Receivables Process Invoice Accounting Subledger Accounting in Receivables Process Multi-Fund Receivables Accounting Subledger Accounting in Receivables Process Adjustment Accounting Subledger Accounting in Receivables Process Receipt Application Accounting Implementation Considerations Agenda Obsolescence and Replacement of Features Description Demo 2 Overview: Oracle Advanced Collections Guided Demonstration - Oracle Advanced Collections Obsolescence and Replacement of Features Description Practice 12 Overview: Using the New Customer Standard HTML Interface Practice - Using the New Customer Standard HTML Interface Solution - Using the New Customer Standard HTML Interface Obsolescence and Replacement of Features Description Obsolescence and Replacement of Features Benefits Transition to New Features Collections Workbench Transition to New Features Collections Workbench - Menu and Forms Transition to New Features Collections Workbench - Account Details Transition to New Features Collections Workbench - Dunning Reprint Transition to New Features Bills Receivable Transition to New Features Trade Accounting Transition to New Features Customer Standard Form Transition to New Features Tax Setup and Calculation Transition to New Features Tax Reporting Transition to New Features Subledger Accounting Transition to New Features COGS and Revenue Matching Transition to New Features AR Customer Supplier Netting Transition to New Features On Account Credit Memo Refund Transition to New Features Consolidated Billing Agenda Centralized Payment Process Description Centralized Payment Process Setup and Process Centralized Payment Process Setup Create Receipt Class/Method Centralized Payment Process Process Invoice Payment Centralized Payment Process Error Handling Centralized Payment Process Setup Customer's Payment Details Implementation Considerations Agenda Automated Refunds Description Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xv

18 Automated Refunds Setup and Process Automated Refunds Setup Receivables Activity Automated Refunds Setup Transaction Sources Automated Refunds Process Applications Form Automated Refunds Process New Refund Attributes Form Automated Refunds Process View Refund Status Implementation Considerations Agenda AP/AR Netting Description AP/AR Netting Benefits AP/AR Netting Process Access AP/AR Netting Process Accessing Demo 3 Overview: AP/AR Netting Demo - AP/AR Netting Agenda Daily Revenue Description Daily Revenue Setup and Process Daily Revenue Setup Accounting Rules Daily Revenue Process Create Invoice Line Implementation Considerations Agenda Revenue Contingencies Overview Revenue Contingencies Description Revenue Contingencies Setup and Process Revenue Contingencies Setup Policy Threshold Revenue Contingencies Setup Seeded Contingencies Revenue Contingencies Setup Contingency Codes/ID Revenue Contingencies Setup Create Rules Revenue Contingencies Process Contingency Assignment Revenue Contingency Process Manage Contingencies Implementation Considerations Practice 13 Overview: Setting Up Revenue Contingencies Practice - Set Up Revenue Contingencies Solution Set Up Revenue Contingencies Agenda COGS and Revenue Matching Description COGS and Revenue Matching Benefits COGS and Revenue Matching Process COGS Recognition Implementation Considerations Agenda Multi-Org Access Control Description Multi-Org Access Control Benefits Receivables & Multi-Org Access Control Multi-Org Access Control Process Multi-Org Access Control Reporting Multi-Org Access Control Reporting Process Summary Oracle Cash Management Oracle Cash Management Objectives Agenda Bank Account Model Definition Bank Account Model Integration Bank Account Model Benefits Cash Management Security Components Bank Account Model Summary Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xvi

19 Practice 1 Overview: Creating a Bank Account Practice - Create a Bank Account Solution - Create a Bank Account Bank Account Model Setup and Process Implementation Considerations Agenda Bank Account Balances and Interest Calculations Description Bank Account Balances and Interest Calculations Benefits Bank Account Balances and Interest Calculations Maintenance Bank Account Balances and Interest Calculations Summary Bank Account Balances and Interest Calculations Setup Implementation Considerations Agenda Bank Account Transfers Description Bank Account Transfers Benefits Bank Account Transfers Process Bank Account Transfers Dependencies and Interactions Bank Account Transfers Summary Bank Account Transfers Setup Bank Account Transfers Setup Set System Profile Practice 2 Overview: Setting Up Payment Templates Practice - Create a Bank Transfer Solution - Create a Bank Transfer Practice 3 Overview: Setting Up Bank Transfers Practice - Create a Bank Transfer Solution - Create a Bank Transfer Implementation Considerations Agenda Subledger Accounting Description Subledger Accounting Benefits Subledger Accounting Key Concepts Subledger Accounting Key Concepts Flow Subledger Accounting Summary Implementation Considerations Agenda Bank Statement Reconciliation Description Bank Statement Reconciliation Benefits Bank Statement Reconciliation Setup Agenda Multi-Org Access Control and Security Description Multi-Org Access Control and Security Benefits Guided Demonstration 1 Overview: Creating a Security Profile Guided Demonstration - Create Security Profile Guided Demonstration 2 Overview: Creating Security Grants Guided Demonstration - Create Security Grants Multi-Org Access Control and Security Summary Implementation Considerations Agenda Cash Pooling Description Creating Cash Pools Viewing and Updating Cash Pools Practices 5 and 6 Overview: Creating Cash Pools Practice - Create Notional Cash Pool Solution - Create Notional Cash Pool Practice - Create Physical Cash Pool Solution - Create Physical Cash Pool Implementation Considerations Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xvii

20 Summary Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xviii

21 Preface Profile Before You Begin This Course Functional knowledge of Oracle General Ledger Functional knowledge of Oracle Payables Functional knowledge of Oracle Purchasing Functional knowledge of Oracle Receivables Functional knowledge of Oracle Cash Management Prerequisites There are no prerequisites for this course. How This Course Is Organized This is an instructor-led course featuring lecture and hands-on exercises. Online demonstrations and written practice sessions reinforce the concepts and skills introduced. Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xix

22 Related Publications Additional Publications System release bulletins Installation and user s guides Read-me files International Oracle User s Group (IOUG) articles Oracle Magazine Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xx

23 Typographic Conventions Typographic Conventions in Text Convention Element Example Bold italic Glossary term (if The algorithm inserts the new key. there is a glossary) Caps and lowercase Courier new, case sensitive (default is lowercase) Initial cap Italic Quotation marks Uppercase Buttons, check boxes, triggers, windows Code output, directory names, filenames, passwords, pathnames, URLs, user input, usernames Graphics labels (unless the term is a proper noun) Emphasized words and phrases, titles of books and courses, variables Interface elements with long names that have only initial caps; lesson and chapter titles in crossreferences SQL column names, commands, functions, schemas, table names Click the Executable button. Select the Can t Delete Card check box. Assign a When-Validate-Item trigger to the ORD block. Open the Master Schedule window. Code output: debug.set ( I, 300); Directory: bin (DOS), $FMHOME (UNIX) Filename: Locate the init.ora file. Password: User tiger as your password. Pathname: Open c:\my_docs\projects URL: Go to User input: Enter 300 Username: Log on as scott Customer address (but Oracle Payables) Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xxi Do not save changes to the database. For further information, see Oracle7 Server SQL Language Reference Manual. Enter user_id@us.oracle.com, where user_id is the name of the user. Select Include a reusable module component and click Finish. This subject is covered in Unit II, Lesson 3, Working with Objects. Use the SELECT command to view information stored in the LAST_NAME column of the EMP table. Arrow Menu paths Select File > Save. Brackets Key names Press [Enter]. Commas Key sequences Press and release keys one at a time: [Alternate], [F], [D] Plus signs Key combinations Press and hold these keys simultaneously: [Ctrl]+[Alt]+[Del]

24 Typographic Conventions in Code Convention Element Example Caps and Oracle Forms When-Validate-Item lowercase triggers Lowercase Column names, table names SELECT last_name FROM s_emp; Passwords PL/SQL objects DROP USER scott IDENTIFIED BY tiger; OG_ACTIVATE_LAYER (OG_GET_LAYER ( prod_pie_layer )) Lowercase italic Uppercase Syntax variables SQL commands and functions CREATE ROLE role SELECT userid FROM emp; Typographic Conventions in Oracle Application Navigation Paths This course uses simplified navigation paths, such as the following example, to direct you through Oracle Applications. (N) Invoice > Entry > Invoice Batches Summary (M) Query > Find (B) Approve This simplified path translates to the following: 1. (N) From the Navigator window, select Invoice then Entry then Invoice Batches Summary. 2. (M) From the menu, select Query then Find. 3. (B) Click the Approve button. Notations: (N) = Navigator (M) = Menu (T) = Tab (B) = Button (I) = Icon (H) = Hyperlink (ST) = Sub Tab Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xxii

25 Typographical Conventions in Oracle Application Help System Paths This course uses a navigation path convention to represent actions you perform to find pertinent information in the Oracle Applications Help System. The following help navigation path, for example (Help) General Ledger > Journals > Enter Journals represents the following sequence of actions: 1. In the navigation frame of the help system window, expand the General Ledger entry. 2. Under the General Ledger entry, expand Journals. 3. Under Journals, select Enter Journals. 4. Review the Enter Journals topic that appears in the document frame of the help system window. Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xxiii

26 Copyright Oracle, All rights reserved. R12 Oracle Financials Functional Migration Fundamentals Table of Contents xxiv

27 Oracle Financials Overview Chapter 1 Oracle Financials Overview Chapter 1 - Page 1

28 Oracle Financials Overview Chapter 1 - Page 2

29 Oracle Financials Overview Oracle Financials Overview Chapter 1 - Page 3

30 Objectives Oracle Financials Overview Chapter 1 - Page 4

31 Why R12? Why R12? Release 12 is defined as The Global Business Release. Global is not just a geographic perspective, but also a comprehensive perspective; release 12 functionality spans across both industries and business functions. Flexible, centralized, global accounting structure 300+ enhancements to best practice business processes Comprehensive governance, risk and compliance platform Truly integrated performance management Real-time profitability analysis Unified financial and operational analytic applications Integration with core industry applications Self-service report formats and publication Superior ownership experience Oracle Financials Overview Chapter 1 - Page 5

32 Architecture Architecture The major components of the new architecture include: Multi-Org Access Control Ledger and Ledger Sets Subledger Accounting Tax Engine Intercompany Bank Model Benefits of the new architecture include: Maintain 1 Ledger with 1 OU for each Company (LE) - Get privacy for each company s data - Manage each company s national and local compliance Combine many companies ledgers in a set - Share GL services and workload - Get combined data Oracle Financials Overview Chapter 1 - Page 6

33 Use MOAC to enable access to many OUs - Process in and report across many Companies Operating Units Oracle Financials Overview Chapter 1 - Page 7

34 Multi-Org Access Control (MOAC) MOAC: Multi-Org Access Control MOAC provides role based access to Operating Units, and allows you to perform multiple tasks across operating units without changing responsibilities. Oracle Financials Overview Chapter 1 - Page 8

35 Subledger Accounting Subledger Accounting Subledger accounting provides centralized rules and a common repository, and global control of your accounts. Features include: 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 Benefits of subledger accounting are: Faster, Easier Reconciliation Corporate Rules = Accounting Standardization Oracle Financials Overview Chapter 1 - Page 9

36 Local Rules = Improved Local Compliance Automate Apples to Apples Adjustments Improved Audit- ability Improved Internal Control Oracle Financials Overview Chapter 1 - Page 10

37 Ledger Oracle Financials Overview Chapter 1 - Page 11

38 Ledger Sets Ledger Sets Ledger sets provide global information at a glance. Ledger sets share a chart of accounts and a calendar. The key benefits to many Ledgers in one set are: Decision-driving business information always available Simpler processing and General Ledger management Data and definitions that can be shared and secured Oracle Financials Overview Chapter 1 - Page 12

39 Ledger Architecture Ledger Architecture Typical Ledger Sets: All IAS/IFRS or US GAAP ledgers 26 Subs in 1 country 35 countries in 1 region Oracle Financials Overview Chapter 1 - Page 13

40 Legal Organization Legal Organization Legal Entities (Les) such as Parent companies, own or control subsidiaries. There are no group entities LEs pay the taxes and therefore need tax registrations Trade between LEs needs intercompany LEs own the money and bank accounts LEs file the accounts and take care of accounting LEs comply with whatever needs compliance: legal in LE Oracle Financials Overview Chapter 1 - Page 14

41 Enhanced Legal Support Enhanced Legal Support Did not replace GRE/LE - employer Added TCA parties for the Authorities Added a Legal Entity Configurator Introduced the following new terms: - Jurisdiction: A legislative category and territory, has legal rules - Legal Authority: Legal body who enforces legislation, collects fees / taxes, etc - Legal Function: Functions that companies are required to perform (e.g. produce yearly report, pay taxes, etc.) - Legal Associations: Mapping companies to Ledgers, BSVs, OUs and other system entities Oracle Financials Overview Chapter 1 - Page 15

42 Benefits of Legal Entities Benefits of Legal Entities Examples of using Legal Entities: 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, etc. Oracle Financials Overview Chapter 1 - Page 16

43 Oracle E-Business Tax Architecture Overview Oracle E-Business Tax (ebtax) consists of a tax knowledge base, a variety of tax services that respond to specific tax events, a set of repositories (for tax content and tax recording) that allow customers to manage their local tax compliance needs in a proactive manner, as well as the ability to integrate with external tax content providers through a single integration point. Oracle Financials Overview Chapter 1 - Page 17

44 Advanced Global Intercompany System Advanced Global Intercompany System Addresses the Top Barrier to a Fast Close Generates subledger invoices Controls transaction entry with Intercompany Calendar Has a Fully Configurable Approval Rules Has a Flexible Security Model Has a Centrally defined Intercompany Accounts Oracle Financials Overview Chapter 1 - Page 18

45 Centralized Banking Centralized Banking Bank account is now associated with the LE instead of the Operating Unit A single bank account serves multiple Operating Units Any and all Operating Units associated with a ledger can be permitted to use the bank account There is a centralized Credit Card Model There is Credit Card Encryption The Supplier & Customer Banks are in TCA Oracle Financials Overview Chapter 1 - Page 19

46 Bank Model Example Bank Model Example Pay invoices from different OUs with 1 instruction New Payments Module New Bank Module New Bank & Credit Card Features Oracle Financials Overview Chapter 1 - Page 20

47 Four Ways to Consolidate Information Oracle Financials Overview Chapter 1 - Page 21

48 Multi-Dimensional Analysis & Reporting Oracle Financials Overview Chapter 1 - Page 22

49 Financial Consolidation Hub Financial Consolidation Hub R12 includes interactive spreadsheet reporting with live drill down to transactions Oracle Financials Overview Chapter 1 - Page 23

50 Data Management Data Management R12 leverages a centralized data model Oracle Financials Overview Chapter 1 - Page 24

51 XML Publisher XML Publisher Enables you to format, manage, and deliver documents Meets business requirements such as: - Removes complexity - Reduces maintenance cost - Reduces TCO Integrated with: R9 CRM, ESA, FMS, HCM, and SCM Oracle Financials Overview Chapter 1 - Page 25

52 New Standard Reports New Standard Reports Benefits of the new standard reports are: You can create report formats using desktop tools (Adobe Acrobat, MS Word, MS Excel, and XML Editors) You can publish in any format, to the web and electronically Reporting is consistent, with one source of data Oracle Financials Overview Chapter 1 - Page 26

53 Other New Features Other New Features There are over 300 new Financial features in Oracle E-Business release 12. Oracle Financials Overview Chapter 1 - Page 27

54 Other New Features Oracle Financials Overview Chapter 1 - Page 28

55 Summary Oracle Financials Overview Chapter 1 - Page 29

56 Oracle Financials Overview Chapter 1 - Page 30

57 Multi-Org Access Control Overview Chapter 2 Multi-Org Access Control Overview Chapter 2 - Page 1

58 Multi-Org Access Control Overview Chapter 2 - Page 2

59 Multi-Org Access Control Overview Multi-Org Access Control Overview Chapter 2 - Page 3

60 Objectives Multi-Org Access Control Overview Chapter 2 - Page 4

61 Agenda Multi-Org Access Control Overview Chapter 2 - Page 5

62 Agenda Multi-Org Access Control Overview Chapter 2 - Page 6

63 Multi-Org Access Control Description Multi-Org Access Control - Description In 11i, when users had to enter or process data for multiple operating units, they had to login to different responsibilities because each responsibility could only access one operating unit. So if there were a centralized payment processing center where users processed payments for multiple organizations, they would have to keep logging in and out of different responsibilities to process payments for a different organization or operating unit. Now in Release 12, Multi-Org Access Control enables companies that have implemented a Shared Services operating model to efficiently process business transactions by allowing users to access, process, and report on data for an unlimited number of operating units within a single application s responsibility. This increases the productivity of Shared Service Centers as users no longer have to switch application responsibilities when processing transactions for multiple operating units. Data security and access privileges are still maintained using security profiles that will now support multiple operating units. Multi-Org Access Control Overview Chapter 2 - Page 7

64 Multi-Org Access Control Description Multi-Org Access Control - Description For example, if you have three operating units in the center you were managing, such as a Belgium Operating Unit, a Holland Operating Unit, and a Denmark operating unit, in 11i you needed to define three different responsibilities. If you had one user who processed payables invoices across all three operating units, then you would need to assign the three responsibilities to that user and then the user would need to log in and out of each responsibility to process invoices. In Release 12, you can create a Security Profile and assign as many operating units as you want to that security profile. So in this example, you could assign all three operating units to the same security profile. Then, you can tie that security profile to a single responsibility using a profile option called MO: Security Profile. For example, you could assign the security profile to the EMEA Payables responsibility to allow that responsibility to process invoices across all three operating units. Processing payables invoices is just one example, with Multi-Org Access Control, you can efficiently perform other processes, such as processing receivables invoices, viewing consolidated requisitions, performing collections using Advanced Collections, and process receiving and drop shipments. Multi-Org Access Control Overview Chapter 2 - Page 8

65 Multi-Org Access Control Benefits Multi-Org Access Control - Benefits Multi-Org Access Control provides improved processing efficiency because it takes time to switch in and out of different responsibilities. As more and more companies move to shared service centers, their users will be able to process data and transactions faster for multiple operating units. It also provides better information for decision making. Much information in the E-Business Suite is striped by operating unit, for example, customer account sites and supplier sites. MOAC gives you the ability to view all of that information across different OUs. So if your security profile has access to three operating units, you can view all of the supplier sites across all three operating units. By viewing data from multiple operating units from a single responsibility, you have more information which enables you to make better decisions. For example, in Oracle Purchasing, you can now view global consolidated requisition demands for each supplier. With this view, you are armed with the information to negotiate purchase discounts. You re ultimately going to reduce costs because you can enter data across operating units faster and you will not have the overhead of setting up and maintaining tons of responsibilities. Multi-Org Access Control Overview Chapter 2 - Page 9

66 Multi-Org Access Control Process Summary Multi-Org Access Control Process Summary Each Financials product team has implemented MOAC to best suit their business process flows. For example, in AP, there s a new operating unit field on their Invoice Workbench. The OU list of values reads from the Security Profile assigned to the responsibility to determine which OUs should be displayed in the LOV. In general, when a user logs in to a responsibility and opens an application, the application will determine which operating units can be accessed and used for processing. The user can then view or process transactions for multiple operating units. Multi-Org Access Control Overview Chapter 2 - Page 10

67 Multi-Org Access Control Setup Multi-Org Access Control Setup Responsibility: Human Resources Navigation: Security > Profile In Release 12, when you define your security profile in HR using the Security profile form or the Global Security profile form, you must: Assign all of the operating units that you want a responsibility to access. Run a concurrent request called Run Security List Maintenance from HR which makes those security profile available and allows you to assign them to a responsibility via a profile option called MO: Security Profile. Multi-Org Access Control Overview Chapter 2 - Page 11

68 Multi-Org Access Control Setup Create Operating Unit Multi-Org Access Control Setup Create Operating Unit Responsibility: General Ledger Navigation: Accounting Setup Manager > Financials : Accounting Setup : Accounting Setup Manager Responsibility: Human Resources: Navigation: Work Structures : Organization > Description In Release 12, you can define your operating units in two places. You can continue to define them in the Oracle HRMS Organization Form or you can define them in the new Accounting Setup Manager feature in General Ledger. The Accounting Setup Manager streamlines the setup and implementation of Oracle Financial Applications. It centralizes the setup and maintenance of common financial components, such as legal entities, operating units, and ledgers. So when you create an accounting setup, assign a legal entity and create the ledgers that will perform the accounting for that legal entity, you can also define and assign the relevant operating units. By leveraging Accounting Setup Manager to define your OUs, you can streamline your setup. In R12, is instead of attaching an OU to a LE, you assign it to a default legal context. Multi-Org Access Control Overview Chapter 2 - Page 12

69 All Release 11i HR Organizations classified as Operating Units will be preserved in Release 12. If operating units are assigned to a set of books, then they will be associated to a primary ledger in an accounting setup. You will be able view all operating units assigned to an upgraded primary ledger using Accounting Setup Manager. Multi-Org Access Control Overview Chapter 2 - Page 13

70 Multi-Org Access Control Setup Define Security Profile Multi-Org Access Control setup Define Security Profile Responsibility: Human Resources Navigation: Security : Profile or Navigation: Security : Global Using Oracle HRMS, you can define your security profile using two forms: The Security Profile form, which allows you to select operating units from only one Business Group The Global Security Profile form, which allows you to select operating units from multiple Business Groups Enter a name, and select the Security Type called Secure organizations by organization hierarchy and/or organization list. This allows you to assign multiple OUs. When assigning operating units, first select classification Operating Unit, and then select the organization or Operating Unit name. You can assign multiple operating units. Multi-Org Access Control Overview Chapter 2 - Page 14

71 Multi-Org Access Control Setup Run System List Maintenance Multi-Org Access Control Setup Run System List Maintenance Responsibility: Human Resources Navigation: Processes and Reports : Submit Processes and Reports Multi-Org Access Control Overview Chapter 2 - Page 15

72 Multi-Org Access Control Setup Set Profile Options Multi-Org Access Control Setup System Profile Options The MO Security Profile controls the list of operating units that a responsibility or user can access. If you set the security profile at the responsibility level, then all users using that responsibility will have access to only the operating units available in the security profile. If you set the security profile at the user level, then the user will have access to only those operating units, irrespective of application responsibility that they log into. The MO: Default Operating Unit is optional and allows you to specify a default operating unit that defaults when you open different subledger application pages. Because you can access multiple operating units, you may want to set up a default one instead of forcing users to constantly have to choose one. User Preferences allows you to specify a default operating unit at the user level. Use the MO: Default Operating Unit profile option to set the operating unit context or default operating unit when accessing an applications. The last profile option is for backwards compatibility and to support products that do not use Multiple Organizations. The release 11i setting was for this is preserved during upgrade. The Release 11i MO: Operating Unit profile option is supported in Release 12 as not all customers of Oracle products require multiple organizations. Multi-Org Access Control Overview Chapter 2 - Page 16

73 Implementation Considerations Implementation Considerations You can define operating units using the HRMS organization form or you can define them in the new Accounting Setup Manager while you define other common financial components, such as legal entities, and ledgers. Then, you use HRMS to define your Security Profile and run the concurrent program. You can also use Accounting Setup Manager to define operating units while you define other common financial components, such as legal entities, and ledgers. From Accounting Setup Manager, you can view all operating units assigned to a primary ledger. Multi-Org Access Control integrates with all E-Business Suite products that use operating units. Multi-Org Access Control Overview Chapter 2 - Page 17

74 Agenda Multi-Org Access Control Overview Chapter 2 - Page 18

75 Multi-Org Preferences Description Multi-Org Access Control Preferences - Description Multi-Org Preferences allows you to control the list of operating units to which you have access. For example, a system administrator may create a security profile that has ten operating units assigned to it and assign it to your responsibility. But, you may only deal with five of the operating units on a daily basis and do not want work space cluttered with extraneous operating units. You could set up Multi-Org preferences to restrict the list of operating units; you have complete control over this and can change it at anytime. In addition, you can specify a default operating unit. Multi-Org Access Control Overview Chapter 2 - Page 19

76 Multi-Org Preferences Benefits Multi-Org Access Control Preferences - Benefits Multi-Org Preferences allows you to be more efficient by allowing you to set up your own preferences and optimize your setup based on how you work. This means faster data entry and cost reduction. Multi-Org Access Control Overview Chapter 2 - Page 20

77 Multi-Org Preferences Process Summary Multi-Org Access Control Preferences Process Summary The processing of transactions is the same if you never specify user preferences. Multi-Org Access Control Overview Chapter 2 - Page 21

78 Multi-Org Preferences Setup Multi-Org Access Control Preferences Setup Most products have added the Preferences user interface to their responsibility menus. You can select preferred operating units which represent a subset of operating units assigned to your responsibility s security profile. You can also set a default operating unit. Multi-Org Access Control Overview Chapter 2 - Page 22

79 Multi-Org Preferences Setup Add to SubMenu Multi-Org Access Control Preferences Setup Add to SubMenu Navigation: System Administrator > Application > Menu Navigation: Application Developer > Application > Menu Most applications have added the Preferences function to their menus. However, if it does not appear, the system administrator can add it. To enable and display Preferences in your menu, request your System Administrator to add the function, FNDMOPREFS to your menu definition. The System Administrator should use either the System Administrator or Application Developer responsibility and select the Menu (Application) option. Select your product s menu and add the function named User Preferences (FNDMOPREFS). Multi-Org Access Control Overview Chapter 2 - Page 23

80 Multi-Org Preferences Setup Set Preferences Multi-Org Access Control Preferences Setup Set Preferences Responsibility: Payables, Vision Operations Navigation: Setup > Options > User Operating Unit Preferences Multi-Org Preferences page: The header displays: the user name that you are logged in as is displayed, the responsibility name, and the Security Profile that you are currently assigned to as defined by the MO: Security Profile profile option. The Default Operating Unit region is where you select a default OU. The List of values displays all operating units assigned to your security profile. The region called Preferred Operating Units is where you select the subset of operating units you want to work with. Multi-Org Access Control Overview Chapter 2 - Page 24

81 Agenda Multi-Org Access Control Overview Chapter 2 - Page 25

82 Enhanced Multi-Org Reporting Description Enhanced Multi-Org Reporting - Description Enhanced Multi-Org reporting is not the same as cross-organization reports that allow you to run a report at the ledger level to obtain results for all operating units assigned to that ledger or obtain results for all the operating units for a GRE/LE. Multi-Org Reporting which allows a user to select any operating unit from a list of accessible operating units. This allows user to report on data for multiple operating units from a single application responsibility. Multi-Org Access Control Overview Chapter 2 - Page 26

83 Enhanced Multi-Org Reporting Benefits Multi-Org Access Control Overview Chapter 2 - Page 27

84 Enhanced Multi-Org Reporting Process Enhanced Multi-Org Reporting Process Once Multi-Org Access Control has been set up, you can run reports for any operating unit you have access to. Multi-Org Access Control Overview Chapter 2 - Page 28

85 Enhanced Multi-Org Reporting Process Run Report Enhanced Multi-Org Reporting - Process Here is an example of an Accounts Payable report called Supplier Audit. When submitting this report, you can select any operating unit that they have access to. Multi-Org Access Control Overview Chapter 2 - Page 29

86 Guided Demonstration 1 Overview: Using MOAC Guided Demonstration 1 Overview: Using MOAC Multi-Org Access Control Overview Chapter 2 - Page 30

87 Guided Demonstration - Using MOAC Create Operating Unit Hierarchy (Optional) Sign on with User: Operations and Password: Welcome Responsibility = Human Resources, Vision Enterprises 1. (N) Work Structures > Organizations > Global Hierarchy 2. Enter XX Hierarchy. 3. Enter Version 1 and Today s date as Start Date. 4. Query top Organization Vision Corporation. 5. Add Vision Operations and Vision Services. Create a Global Profile 6. (N) Security > Global Profile Multi-Org Access Control Overview Chapter 2 - Page 31

88 Field Name Security Type Organization Hierarchy Specify Top Organization Top Organization XX Corporation Value Secure organizations by organization hierarchy and/or organization list XX Hierarchy Vision Corporation Include NOTE: Optionally use the next two steps to enter a list of Operating Units instead of a Hierarchy or to add additional Operating Units to the list included in the Hierarchy. Enter Classification: Operating Unit and Organization Name: Vision Operations. Repeat for Vision Services. Run the Security Maintenance List program 14. (N) Processes and Reports > Submit Processes and Reports > Single Request > (B) Go Multi-Org Access Control Overview Chapter 2 - Page 32

89 Name Parameters Field Security Maintenance List Value Generate list for... All Global Security Profiles 17. (B) Submit > (B) Go. 18. (M) View > Requests > (B) Find >(B) Refresh Data to ensure the report completes successfully. Create a customized responsibility Responsibility = System Administrator 19. (N) Security > Responsibility > Define Field Responsibility Name Application Responsibility Key Data Group Name Data Group Application Menu Request Group Name 27. (I) Save. Value KW Payables Payables KWPAY Standard Payables AP_NAVIGATE_GUI12 All Reports Multi-Org Access Control Overview Chapter 2 - Page 33

90 Assign the security profile 28. (N) Profile > System 29. Select Responsibility and enter XX Payables. 30. Enter MO%Sec% in the Profile field. 31. (B) Find. Multi-Org Access Control Overview Chapter 2 - Page 34

91 32. Enter XX Corporation in the white box under the XX Payables responsibility. 33. (I) Save. Assign the responsibility to your user 34. (N) Security > User > Define Multi-Org Access Control Overview Chapter 2 - Page 35

92 35. (I) Find to find Operations. 36. (I) New to add XX Payables to the list of responsibilities. 37. (I) Save. Test the MOAC Setup Responsibility: XX Payables 38. (N) Invoices > Enter > Invoices 39. (B) LOV in the Operating Unit field to see the list of Operating Units that can be accessed. Multi-Org Access Control Overview Chapter 2 - Page 36

93 Multi-Org Access Control Overview Chapter 2 - Page 37

94 Summary Multi-Org Access Control Overview Chapter 2 - Page 38

95 Subledger Accounting Overview Chapter 3 Subledger Accounting Overview Chapter 3 - Page 1

96 Subledger Accounting Overview Chapter 3 - Page 2

97 Subledger Accounting Overview Subledger Accounting Overview Chapter 3 - Page 3

98 Objectives Subledger Accounting Overview Chapter 3 - Page 4

99 Agenda Subledger Accounting Overview Chapter 3 - Page 5

100 Agenda Subledger Accounting Overview Chapter 3 - Page 6

101 Subledger Accounting Subledger Accounting Subledger accounting is a new product in R12 which significantly enhances the accounting support across the E-Business Suite products. Subledger Accounting includes new ledger support and enhances the legal entity and intercompany accounting features. Subledger Accounting is a new set of tools, accounting engine, and repository that you can use to: Support multiple accounting requirements concurrently in a single instance through configurable rules Increase transparency and have full auditability of the transaction and accounting data, through a common user interface and data model Facilitate accounting reconciliation, especially for inter-transactional accounts Improve accounting reporting and analysis Subledger Accounting Overview Chapter 3 - Page 7

102 Subledger Accounting Description Subledger Accounting Description Subledger Accounting is mainly a rule-based accounting engine that centralizes accounting for Oracle E-Business Suite products in R12 as well as provide an accounting toolset and repository for third-party applications. It is not a separate product in itself, but is Oracle s engine catering to the accounting needs of both Oracle and external modules. Together with the new ledger support, it enables support of multiple accounting requirements concurrently in a single instance. Different accounting regulations can be satisfied by maintaining and applying different sets of rules to different sets of transactions; or accounting for the same transaction with multiple methods. By maintaining a full link between the transaction and accounting data, it allows powerful reconciliation and auditing capabilities. Since it provides the setup and inquiry UI and data model for accounting across modules, it enables consistency in reporting, analysis, and user experience. Rule-based accounting engine, toolset and repository supporting both Oracle E-Business Suite and external modules Allows multiple accounting representations for a single business event, resolving conflicts between corporate and local fiscal accounting requirements Subledger Accounting Overview Chapter 3 - Page 8

103 Retains the most granular level of detail in the subledger accounting model, with different summarization options in the General Ledger, allowing full auditability and reconciliation Subledger Accounting Overview Chapter 3 - Page 9

104 Agenda Subledger Accounting Overview Chapter 3 - Page 10

105 Business Benefits Business Benefits The flexibility of the accounting rule setup allows meeting different requirements in different legislative, geographic or industry contexts. Assuming operations in multiple countries, each with its own legal requirements and accounting standards, you are able to define a setup to meet each of the requirements. SLA allows for multiple accounting requirements for a single transaction or business event. Subledger Accounting Overview Chapter 3 - Page 11

106 Business Benefits Global Example Business Benefits Global Example This example assumes a US-based corporation with operations in the UK and France. The French operation is subject to the French accounting regulations, and thus has to report its activities to the local authorities denominated in Euros, according to the French business calendar, French chart of accounts, and the French interpretation of IFRS (International Financial Reporting Standards). The UK operation, similarly, is subject to the UK regulations, which for this example s sake are not as restrictive as the French ones. Thus, the UK operation does its local reporting in the local currency, the British Pound, but according to the US business calendar, US COA, and US GAAP. The US operation reports in the USD per the US business calendar, US COA, and GAAP. In the R12 ledger setup, all of these operations are defined as three separate ledgers to satisfy local reporting requirements. However, the headquarters/parent company wants to have a consolidated global visibility of the worldwide operations. It is not very meaningful to consolidate or compare each of these entities with each other for a few reasons: The reporting currencies are different Subledger Accounting Overview Chapter 3 - Page 12

107 The COA and the method of accounting for the French activities may be considerably different than those in UK and US. For example, in FR, purchases or inventory are reported as expenses, whereas in the other instances as inventory items. Hence, a mere currency conversion will not be sufficient. With R12 ledger architecture and SLA, the following model can be implemented to solve this business need: For the UK operation, converting the activities to the US equivalent requires a currency conversion since the calendar, COA, and accounting methods are common. This is accomplished through the addition of a reporting currency to the UK ledger. For the French operation, conversion only is not sufficient. A secondary ledger must be defined for the French ledger, which shares the same currency, COA, calendar, and accounting method as the HQ. Through the definition of reporting currency and secondary ledgers, the three operations can satisfy local regulations, and also allow comparison and consolidation. In above definition, SLA allows you to: Define multiple accounting methods Use separate accounting methods on different ledgers Create journal entries on multiple ledgers for a single business event (French activities being accounted for on the primary ledger per IFRS method, and on the secondary ledger per US GAAP method) Subledger Accounting Overview Chapter 3 - Page 13

108 Business Benefits Business Benefits In 11i, accounting information and the tie back to the underlying transaction is maintained differently for each module. Different subledgers/modules have their own model as to how and what they capture in terms of accounting data. Some allow capturing more details and some link between the journals and the underlying transactions. Some do not have the same flexibility or detail. This causes difficulty and inconsistency in reporting for auditing, reconciliation or whichever purpose across modules. In R12, SLA provides the ability to retain the full link between transaction and accounting data for all modules, and thus allow auditability. The accounting SLA creates is strongly tied to the underlying transactions. Subledger Accounting Overview Chapter 3 - Page 14

109 Business Benefits - Auditability Subledger Accounting Overview Chapter 3 - Page 15

110 Business Benefits Transaction Example Business Benefits Transaction Example SLA tracks how the journal entry is built from a transaction. On the left side of the screen, there is an invoice for two items, freight and tax. On the right, there are two entries created: one on the US corporate ledger and on the FR statutory ledger. The expense entry is created for the two item lines of the invoice. The following two lines for freight and tax respectively. The rules have been setup to summarize all and create a single liability entry. We can also configure the rule so that three or four separate liability lines are created. SLA stores and tracks how each line of the invoice contributed to the journal entry. Subledger Accounting Overview Chapter 3 - Page 16

111 Business Benefits Business Benefits Another benefit is the support for business flows in accounting within and across modules. In flows where accounting for multiple transactions need to be tied together, SLA provides standard features to recognize multi-transactional flows. This is very important in especially reconciling accounts inter-transactional accounts. Subledger Accounting Overview Chapter 3 - Page 17

112 Business Benefits - Accounting Reconciliation Business Benefits - Accounting Reconciliation Going back to the previous example and looking at a payment that pays off the invoice, the SLA data model not only allows keeping the transaction-to-accounting link, but the inherent features also allow to reflect the transaction flows in the accounting side. So here, a particular payment is applied to a particular invoice liability. Through the usage SLA Business Flows functionality, at the time of accounting for the payment, we can to go back to the journal created for invoice and back out from the exact liability account, at the exact rate that the invoice was converted at, if it was a foreign currency one. Because the feature ensures accuracy itself, the need for reconciliation is reduced. Subledger Accounting Overview Chapter 3 - Page 18

113 Agenda Subledger Accounting Overview Chapter 3 - Page 19

114 Key Concepts Key Concepts The event model defined in SLA for each subledger represents the transaction/document types and the lifecycle of each transaction: Event class classifies transaction types. An invoice, for example, would be an event class. Event type defines possible actions on each event class with potential accounting significance, for example, validation of an invoice. The journal creation rules are defined per event class/event type. Subledger Accounting Overview Chapter 3 - Page 20

115 Event Classes Event Classes The slide shows event classes for Payables, Purchasing and Receivables. Subledger Accounting Overview Chapter 3 - Page 21

116 Events Events An accounting event for a payables invoice, for example, is the validation, adjustment or the cancellation of the invoice. Similarly, for an AR receipt, accounting events are the creation, application, or reversal of the receipt. When one of these actions is taken on a receipt transaction, an accounting event is created. Based on the rule setup, there may or may not be a resulting journal entry. You can set up rules to generate journal entries for some events, but not for others. Subledger Accounting Overview Chapter 3 - Page 22

117 Transaction Objects and Sources Transaction Objects and Sources Transaction object and sources are the data model for each subledger that contains the transaction attributes/information made available to be used during journal rule setup and journal entry generation. Subledger Accounting Overview Chapter 3 - Page 23

118 Agenda Subledger Accounting Overview Chapter 3 - Page 24

119 Major Features Major Features SLA is a toolset, engine, and repository for centralized accounting processing. This means that SLA provides the ability to set up journal creation rules and creates journal entries according to multiple different accounting methods simultaneously. However, there are many options and advanced features that facilitate the entire accounting process, including: Converting foreign currency journals into the functional currency Calculating exchange rate gain/loss Scheduling the automatic recognition of deferred revenue and expenses across the relevant accounting periods Supporting automatic accrual reversals Tracking versions and effective dates on rules Processing a subset of transactions at a time, based on transaction type Enabling straight through accounting processing generating journal entries straight from the transaction view to posting to general ledger at the single click of a button Allowing testing of rule setup by what-if type of analysis with draft accounting Subledger Accounting Overview Chapter 3 - Page 25

120 Major Features Major Features Easy to use inquiry pages and customizable reports Intelligible errors reporting and tools to troubleshoot Ability to copy rules in and between environments Manual adjustment entries in each subledger application Auto-maintenance of rules when accounts are disabled Various geography-specific requirements such as journal entry sequencing, and control accounts reporting Subledger Accounting Overview Chapter 3 - Page 26

121 Accounting Methods Builder Accounting Methods Builder Accounting Methods builder is the toolset enabling the creation of journal entry rules that allows multiple sets of rules to be defined. Subledger Accounting Overview Chapter 3 - Page 27

122 Accounting Methods Builder Accounting Methods Builder In order to make rule setup as flexible as possible, journal entries are split into components: Descriptions, Line Types, and Account Derivation rules. The description can be on the entry or its individual lines. You set up descriptions, as many as you want, by using pieces of data from the transaction and constant values. For example, you might have an invoice showing the event (invoice validation), the invoice number, type, date, description etc. The Line Type is another component, actually one of the two main components of the entry. The line type defines whether this is a debit or a credit, what the accounting class is, where the amount should come from etc. Again, you set up as many as you need of these for a particular entry. You can have a single invoice line or distribution create as many debits or credits as needed. The third major piece is the account derivation rule, which determines to which GL account a line should be booked. There is a lot of flexibility around the account derivation rules. You can simply set up a rule for each flexfield to be used, or you can make it more complex and build each flexfield segment by segment by combining multiple rules. These rules can be setup to derive the accounts or segment values from transactional data, including conditions of when to use a particular rule versus another. Subledger Accounting Overview Chapter 3 - Page 28

123 Accounting Methods Builder Accounting Methods Builder The transaction objects and the sources carry transaction information into the rules defined for each component of an entry. These components, for example, journal line type, account derivation rule, journal entry descriptions, are attached together as a journal line definition for a particular event. For example, you set up a JLD for an invoice validation event, another one for a payment creation, another one for payment clearing. The set of such rules for a particular subledger application is called the application accounting definition. And the set of AADs for multiple applications is called the subledger accounting method. Note that it is possible to maintain multiple accounting methods. You can set up as many components as you like, and use them for different accounting methods. You can set up an accounting method that creates entries in compliance with US GAAP, and another one with IFRS. Because the JE components are modular, these two methods could share components, such as entry descriptions. The accounting methods is assigned to each ledger, which determines which rules are applied when accounting is being generated for a particular ledger. If you have a setup with a primary Subledger Accounting Overview Chapter 3 - Page 29

124 and a secondary ledger, you could have different accounting methods attached to and used for each. Subledger Accounting Overview Chapter 3 - Page 30

125 Online Accounting Online Accounting The payables invoice entry window might show, for example an invoice that has been recorded and validated. To generate the journal entries, access the actions button and select Create Accounting options. You can: Create a draft entry generation Create the entry and post to GL straight off this window. This creates entries for the invoice on all the related ledgers of this operating unit, that is, the primary ledger and any associated reporting and secondary ledgers. The invoice amount is converted to each of the ledger currencies, any exchange rate variance on any of the ledgers is calculated and posted. Through the usage of business flows feature, during accounting, you can to track back to the purchase order or receipt, and back out from the same accrual accounts that were hit originally. By also getting the conversion rate from that original booking, you can calculate the exchange rate variance accurately. Subledger Accounting Overview Chapter 3 - Page 31

126 Inquiries Inquiries Navigation: Transaction view > Tools: View Accounting > JE inquiry Transaction security in inquiries, reports, creating accounting Subledger Accounting Overview Chapter 3 - Page 32

127 Inquiries Subledger Accounting Overview Chapter 3 - Page 33

128 Offline Accounting Offline Accounting Offline accounting is processed on a ledger basis. When submitted for the ledger Vision Operations (USA) all related ledgers, that is, reporting currencies and secondary ledgers are also processed at the same time. When processing transactions for a ledger, you can also enforce transaction security model of the subledger to accounting. When a user submits the accounting process, you can have either all the transactions of the ledger process, or only the transactions of the operating units/inventory organizations that the user has access to. Subledger Accounting Overview Chapter 3 - Page 34

129 Standard Reports Standard Reports This is a sample report created by the offline accounting program. It shows any errors encountered during the process, and suggests the ways to correct the errors. The Accounting report and other standard reports provided, such as journal entries report, account analysis report, and third party balances report all utilize the XML technology and allow you to change the layout of the reports, change the default sorting and grouping, customize further by adding company logos and other things. Subledger Accounting Overview Chapter 3 - Page 35

130 Agenda Subledger Accounting Overview Chapter 3 - Page 36

131 Setup Setup A journal entry has three components: the description, line type, and account derivation rule. To setup your own rules, you can either define your components from scratch or you can copy the components seeded by Oracle, and modify them. Note that rules and components seeded by Oracle cannot be modified. Similarly, rules that you as a customer define will not be overwritten or impacted at all during a future upgrade or patching. When you want to modify the rules, after defining your own component, you must define all the other components hierarchically above that specific component all the way to the subledger accounting method so that you can supersede Oracle defined rules. Subledger Accounting Overview Chapter 3 - Page 37

132 Setup - Journal Line Type Subledger Accounting Overview Chapter 3 - Page 38

133 Setup Journal Line Type Setup Journal Line Type The journal line type determines what kind of an entry to generate. It also determines the accounting class and sets the conditions under which the rule creates a line. It also specifies the values needed for line generation and controls behavior for certain feature, such as multiperiod accounting. Subledger Accounting Overview Chapter 3 - Page 39

134 Setup - Journal Line Type Setup Journal Line Type Navigation: Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder >Journal Entry Setups > Journal Line Types 1. Journal line type determines whether to create a debit entry, a credit entry, or an entry for exchange gain/loss. 2. It also identifies the accounting class on the entry, such as Expense or Trade Liability. 3. It defines the conditions under which the rule will be executed to create a line. 4. It determines the values needed for entry line generation, such as amount, currency, conversion rate information, which are called accounting attributes. That is, it defines where the values for the entry should come from, which transaction data should be used. 5. It also controls behavior for certain features i.e. multiperiod accounting, business flows, line merging and summarization Subledger Accounting Overview Chapter 3 - Page 40

135 Guided Demonstration 1 Overview: Defining Journal Line Types for Payables Guided Demonstration 1 Overview: Defining Journal Line Types Subledger Accounting Overview Chapter 3 - Page 41

136 Guided Demonstration - Defining Journal Line Types in Payables Defining Journal Line Types Responsibility = Payables, Vision Operations (USA) 1. Navigate to the Journal Line Types window. (N) Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Journal Entry Setups > Journal Line Types 2. (B) New. 3. In the Event Class field, select Invoices. 4. In the Line Type Code field, enter XX_MISC_EXPENSE. 5. In the Name field, enter XX Miscellaneous Expense. 6. In the Description field, enter XX Miscellaneous Expense. 7. In the Accounting Class field, select Miscellaneous Expense. 8. In the Balance Type region, select Actual. 9. In the Side region, select Debit. 10. Select Yes from the Switch Debit/Credit dropdown list. 11. In the Merge Matching Lines field, select No. 12. In the Transfer to GL region, select Summary. 13. (B) Conditions. 14. In the Seq field, enter In the Source field, select Invoice Distribution Type. 16. In the Operator field, select =. 17. In the Value Type field, select Constant. 18. In the Value field, select Item. 19. (M) File Save 20. (M) File Close Form Subledger Accounting Overview Chapter 3 - Page 42

137 21. Save the Expense journal line type. 22. Create a Liability journal line type based on the following information: Field Name Liability Journal Line Type Event Class Invoices Line Type Code Name Description Accounting Class Balance Type Side Switch Debit/Credit Merge Matching Lines Transfer to GL XX_AP_LIAB_INV XX Liability XX Liability when invoice validated Liability Actual Credit Yes No Summary Note: No conditions are required for the Liability journal line type. Subledger Accounting Overview Chapter 3 - Page 43

138 Practice 1 Overview: Defining Journal Line Types for Payables Practice 1 Overview: Defining Journal Line Types for Payables Subledger Accounting Overview Chapter 3 - Page 44

139 Practice - Defining Journal Line Types for Payables Overview In this practice, you will do the following: Define two journal line types, as follows: Expense Liability Assumptions Tasks Replace XX with your terminal number or initials. You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice. Responsibility selected to complete this practice is Payables, Vision Operations (USA). Log on to the system User Name = operations Password = welcome Responsibility = Payables, Vision Operations (USA) Defining Journal Line Types 1. Navigate to the Journal Line Types window. (N) Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Journal Entry Setups > Journal Line Types 2. Create two journal line types using the following information: Field Name Expense Journal Line Type Liability Journal Line Type Event Class Invoices Invoices Line Type Code XX_MISC_EXPENSE XX_AP_LIAB_INV Name Miscellaneous Expense Liability Subledger Accounting Overview Chapter 3 - Page 45

140 Description Miscellaneous Expense Liability when invoice validated Accounting Class Miscellaneous Expense Liability Balance Type Actual Actual Side Debit Credit Switch Debit/Credit Yes Yes Merge Matching Lines No Transfer to GL Summary Summary 3. Save the journal line types. No Subledger Accounting Overview Chapter 3 - Page 46

141 Solution Defining Journal Line Types for Payables Defining Journal Line Types Responsibility = Payables, Vision Operations (USA) 1. Navigate to the Journal Line Types window. (N) Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Journal Entry Setups > Journal Line Types The Find Journal Line Types window appears. 2. (B) New. The Journal Line Types window appears. Subledger Accounting Overview Chapter 3 - Page 47

142 The Application field is automatically populated with the application name associated with the user s responsibility, in this example, Payables. The Owner field is automatically populated. For components seeded by Oracle, the value is Oracle. For components created on site by users, the value is User. The Enabled field is automatically enabled, and makes this journal line type available for use. 3. In the Event Class field, select the event class from the list of values, for example, Invoices. 4. In the Line Type Code field, enter a code, for example, XX_MISC_EXPENSE. Note: You cannot modify a seeded journal line type or any other seeded component as it could get overwritten in an upgrade. Instead you can copy the seeded type and then modify it appropriately. The copied journal line type has an Owner type of User. The list of values displays the component name and the owner to distinguish between seeded and user-defined components. 5. In the Name field, enter XX Miscellaneous Expense. 6. In the Description field, optionally enter a description, for example, XX Miscellaneous Expense. Subledger Accounting Overview Chapter 3 - Page 48

143 7. In the Accounting Class field, select Miscellaneous Expense. The accounting class is shared across applications and enables you to classify journal entry lines. The list of values for this field contains all accounting classes that are seeded but you can add new accounting classes. The Rounding Class defaults to the accounting class, in this example, Miscellaneous Expense. The rounding class, along with the transaction rounding reference accounting attribute, groups lines together in order to determine whether rounding is necessary. 8. In the Balance Type region, select Actual. 9. In the Side region, select Debit. 10. Select Yes from the Switch Debit/Credit dropdown list. This option determines whether negative amounts will result in negative amounts on the same side or positive amounts on the opposite side. 11. In the Merge Matching Lines field, select No. This option summarizes subledger journal lines within each subledger entry. Journal entry lines with matching criteria are merged. 12. In the Transfer to GL region, select Summary to summarize subledger journal entry lines by account combination. 13. (B) Conditions to add a condition to create a journal line type to account for a miscellaneous expense when an invoice is validated. 14. In the Seq field, enter In the Source field, select Invoice Distribution Type. 16. In the Operator field, select =. 17. In the Value Type field, select Constant. 18. In the Value field, select Item. Subledger Accounting Overview Chapter 3 - Page 49

144 19. (M) File Save 20. (M) File Close Form The Journal Line Types window should now look like this: Subledger Accounting Overview Chapter 3 - Page 50

145 21. Save the Expense journal line type. 22. Create a Liability journal line type based on the following information: Field Name Event Class Line Type Code Name Description Accounting Class Balance Type Side Switch Debit/Credit Merge Matching Lines Transfer to GL Liability Journal Line Type Invoices XX_AP_LIAB_INV XX Liability XX Liability when invoice validated Liability Actual Credit Yes No Summary Note: No conditions are required for the Liability journal line type. Subledger Accounting Overview Chapter 3 - Page 51

146 Setup - Account Derivation Rule Subledger Accounting Overview Chapter 3 - Page 52

147 Setup Account Derivation Rule Setup Accounting Derivation Rule You can set up a separate rule for each flexfield to be used, or you can make it more complex and build each flexfield segment by segment by combining multiple rules. These rules can be setup to derive the accounts or segment values from transactional data, including conditions under which to use a particular rule versus another. Subledger Accounting Overview Chapter 3 - Page 53

148 Setup - Account Derivation Rule Setup Account Derivation Rule Navigation: Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Journal Entry Setups > Account Derivation Rules Multiple output values can be defined in a single rule, each with a condition and evaluation order of the conditions, so that one value is returned under specific situations versus others. For example, use a particular account if invoice distribution type is accrual, versus another account if it is not. Subledger Accounting Overview Chapter 3 - Page 54

149 Guided Demonstration 2 Overview: Defining Account Derivation Rules for Payables Guided Demonstration 2 Overview: Defining Account Derivation Rules for Payables Subledger Accounting Overview Chapter 3 - Page 55

150 Guided Demonstration - Defining Account Derivation Rules for Payables Responsibility: Payables, Vision Operations (USA) Username/Password = operations/welcome Creating an Account Derivation Rule for the Liability Journal Line Type 1. Navigate to the Journal Lines Definitions window. (N) Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Methods and Definition > Journal Lines Definitions 2. In the Definition Name field, select XX Payables Accrual. 3. (B) Find 4. Select the XX Liability journal line type. 5. (B) Account Derivation Rule 6. (B) New 7. In the Rule Code field, enter XX_LIAB_ACC. 8. In the Rule Name field, enter XX Liability Account. 9. In the Description field, enter XX Liability Account. 10. In the Accounting Chart of Accounts field, select Operations Accounting Flex. 11. Select the Flexfield radio button. 12. In the Priority field, enter In the Value Type field, select Constant. 14. In the Value field, enter (M) File Save 16. (M) File Close Form 17. In the Journal Lines Definitions window, select the XX Liability journal line type. 18. In the Segment field, select All Segments. Subledger Accounting Overview Chapter 3 - Page 56

151 19. In the Rule Name field, select XX Liability Account. 20. (M) File - Save Creating an Account Derivation Rule for the Expense Journal Line Type 21. Select the XX Miscellaneous Expense journal line type. Note: You may need to use the Shift and Page Dn keys, followed by the down arrow to select the next journal line type if pressing the down arrow key doesn t work. 22. (B) Account Derivation Rule 23. (B) New 24. In the Rule Code field, enter XX_EXPENSE_ACCOUNT. 25. In the Rule Name field, enter XX AP Expense Account. 26. In the Description field, enter XX Expense Account. 27. In the Priority field, enter In the Value Type field, select Source. 29. In the Value field, select Invoice Distribution Account. 30. (M) File Save 31. (M) File Close Form 32. In the Journal Lines Definitions window, place the cursor in the XX Miscellaneous Expense line. 33. In the Segment field, select All Segments. 34. In the Rule Name field, select XX Expense Account. 35. (M) File Save Subledger Accounting Overview Chapter 3 - Page 57

152 Practice 2 Overview: Defining Account Derivation Rules for Payables Practice 2 Overview: Defining Account Derivation Rules for Payables Subledger Accounting Overview Chapter 3 - Page 58

153 Practice - Defining Account Derivation Rules for Payables Overview In this practice, you will do the following: Define two account derivation rules; one for the Liability journal line type and another for the Expense journal line type. Assign the account derivation rules to the relevant journal line types in the Journal Lines Definitions window. Assumptions Tasks Replace XX with your terminal number or initials. You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice. Responsibility selected to complete this practice is Payables, Vision Operations (USA). Log on to the system User Name = operations Password = welcome Responsibility = Payables, Vision Operations (USA) Create an account derivation rule for the Liability journal line type 1. Navigate to the Journal Lines Definitions window. (N) Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Methods and Definition > Journal Lines Definitions 2. Search for the XX Accrual Invoices journal line definition. 3. Select the XX Liability journal line type. 4. Go to the Account Derivation Rule window. 5. Create a new account derivation rule code called XX_LIAB_ACC with a rule name of XX Liability Account. 6. Associate this rule with the Operations Accounting Flex chart of accounts. Subledger Accounting Overview Chapter 3 - Page 59

154 7. Enter a flexfield rule for the constant Save the liability rule. Assign the Liability account derivation rule to the Liability journal line type 9. In the Journal Lines Definitions window, select the XX Liability journal line type. 10. In the Account Derivation Rules region, apply the XX Liability Account rule to all segments. 11. Save your work. Create an account derivation rule for the Expense journal type 12. Select the XX Miscellaneous Expense journal line type in the Journal Lines Definitions window. 13. Go to the Account Derivation Rule window. 14. Create a new account derivation rule code called XX_EXPENSE_ACC with a rule name of XX Expense Account. 15. Associate this rule with the Operations Accounting Flex chart of accounts. 16. Enter a flexfield rule for the Invoice Distribution Account source. 17. Save the expense rule. Assign the Liability account derivation rule to the Expense journal line type 18. In the Journal Lines Definitions window, select the XX Miscellaneous Expense journal line type. 19. In the Account Derivation Rules region, apply the XX Expense Account rule to all segments. 20. Save your work. Subledger Accounting Overview Chapter 3 - Page 60

155 Solution Defining Account Derivation Rules for Payables Log on to the system User Name = operations Password = welcome Responsibility: Payables, Vision Operations (USA) Creating an Account Derivation Rule for the Liability Journal Line Type 1. Navigate to the Journal Lines Definitions window. (N) Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Methods and Definition > Journal Lines Definitions The Find Journal Lines Definitions window appears. 2. In the Definition Name field, select XX Accrual Invoices. 3. (B) Find The Journal Lines Definitions window appears. Subledger Accounting Overview Chapter 3 - Page 61

156 4. Select the XX Liability journal line type. Note: You may need to use the Shift and Page Dn keys, followed by the down arrow to select the next journal line type if pressing the down arrow key doesn t work. 5. (B) Account Derivation Rule The Find Account Derivation Rules window appears. Subledger Accounting Overview Chapter 3 - Page 62

157 6. (B) New The Account Derivation Rules window appears. The application name defaults from the application associated with the responsibility, in this example, Payables. The Owner field is automatically populated by Subledger Accounting. For components seeded by Oracle, the value is Oracle. For components created on site by users, the value is User. Retain the default for the Enabled check box which is selected to make the account derivation rule available for use for any application with reference objects used in this account derivation rule and accounting chart of accounts. 7. In the Rule Code field, enter XX_LIAB_ACC. 8. In the Rule Name field, enter XX Liability Account. 9. In the Description field, enter XX Liability Account. 10. In the Accounting Chart of Accounts field, select Operations Accounting Flex. 11. Select the Flexfield radio button. 12. In the Priority field, enter 1. Rules are evaluated in ascending order, where the highest priority has the lowest number, until a condition is met. It is advantageous to list the most commonly met rules and Subledger Accounting Overview Chapter 3 - Page 63

158 conditions first. The order in which rules and conditions are evaluated by updating the priority number instead of by deleting and rewriting detail lines can be changed. Once the conditions associated with a detail line are satisfied, the value from that line is used and other lines are ignored. 13. In the Value Type field, select Constant to specify the method of deriving the account combination or segment value. 14. In the Value field, enter Save your work: (M) File Save 16. Close the Account Derivation Rules window: (M) File Close Form 17. In the Journal Lines Definitions window, select the XX Liability journal line type. 18. In the Segment field, select All Segments. Subledger Accounting Overview Chapter 3 - Page 64

159 19. In the Rule Name field, select XX Liability Account. 20. Save your work: (M) File - Save Creating an Account Derivation Rule for the Expense Journal Line Type 21. In the Journal Lines Definitions window, select the XX Miscellaneous Expense journal line type. Note: You may need to use the Shift and Page Dn keys, followed by the down arrow to select the next journal line type if pressing the down arrow key doesn t work. 22. (B) Account Derivation Rule The Find Account Derivation Rule window appears. Subledger Accounting Overview Chapter 3 - Page 65

160 23. (B) New The Account Derivation Rules window appears. 24. In the Rule Code field, enter XX_EXPENSE_ACCOUNT. 25. In the Rule Name field, enter XX AP Expense Account. 26. In the Description field, enter XX Expense Account. 27. In the Accounting Chart of Accounts field, select Operations Accounting Flex. 28. In the Output Type region, select the Flexfield radio button. 29. In the Priority field, enter In the Value Type field, select Source. 31. In the Value field, select Invoice Distribution Account. Subledger Accounting Overview Chapter 3 - Page 66

161 32. Save your work: (M) File Save 33. Close the Account Derivation Rules window: (M) File Close Form 34. In the Journal Lines Definitions window, place the cursor in the XX Miscellaneous Expense line. 35. In the Segment field, select All Segments. 36. In the Rule Name field, select XX AP Expense Account. Subledger Accounting Overview Chapter 3 - Page 67

162 37. Save your work: (M) File Save Subledger Accounting Overview Chapter 3 - Page 68

163 Setup Journal Entry Description Setup Journal Entry Description Navigation: Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Journal Entry Setups > Journal Entry Descriptions The final component that makes up a journal entry is the description. A description can be assigned to the journal entry header itself, to the set of debits and credits; or different descriptions can be assigned to each of the lines of the entry. For example, a description on the liability entry containing information about the supplier, and a description on the item expense line containing information about the item or expense itself. Similar to the other journal entry components, you can define multiple descriptions and attach conditions to each. The description can be built by using constants, transaction attributes, or a combination of the two. Subledger Accounting Overview Chapter 3 - Page 69

164 Setup Journal Line Definition Setup Journal Line Definition The three components of a journal entry are grouped together as a journal line definition to create the rule for a particular event type. Subledger Accounting Overview Chapter 3 - Page 70

165 Setup - Journal Line Definition Setup Journal Line Definition Navigation: Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Methods and Definitions > Journal Lines Definitions The journal line type, its description, and its account derivation rules are all attached together on the Journal line definition to define the rule creating an entry. Here, we are looking at a sample definition for AP invoice validation event. We have several line types defined to create each of the possible entry lines for an invoice validation, such as backing out of the accrual, tax, exchange rate variance, freight expense, and liability. To each of these, we have assigned a description, and one or more account derivation rules. Note that for the liability line, we have two account derivation rules: one that generates the flexfield for the liability account, and the other to overwrite the balancing segment on the flexfield derived. This is an example of how multiple account derivation rules can be used to build complex flexfield generation rules. Subledger Accounting Overview Chapter 3 - Page 71

166 Guided Demonstration 3 Overview: Defining Journal Lines Definitions for Payables Guided Demonstration 3 Overview: Defining Journal Lines Definitions for Payables Subledger Accounting Overview Chapter 3 - Page 72

167 Guided Demonstration - Defining Journal Lines Definitions for Payables Responsibility: Payables, Vision Operations (USA) Username/Password = operations/welcome 1. Navigate to the Journal Lines Definitions window. (N) Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Methods and Definition > Journal Lines Definitions Or (B) Journal Lines Definitions from the Application Accounting Definitions window 2. (B) New 3. In the Event Class field, select Invoices. 4. In the Definition Code field, enter XX_ACCRUAL_INVOICES. 5. In the Definition Name field, enter XX AP Accrual Invoices. 6. Optionally, enter a description, for example, XX Payables Accrual. 7. In the Event Type field, select All. 8. In the Accounting Chart of Accounts field, select Operations Accounting Flex. 9. In the Line Assignments region, enter the following information based on the journal line types you previously defined: Journal Line Type Line Description XX Miscellaneous Expense XX Liability 10. (M) File - Save. Invoice Distribution Description Invoice Distribution Description Subledger Accounting Overview Chapter 3 - Page 73

168 Practice 3 Overview: Defining Journal Lines Definitions for Payables Practice 3 Overview: Defining Journal Lines Definitions for Payables Subledger Accounting Overview Chapter 3 - Page 74

169 Practice - Defining Journal Lines Definitions for Payables Overview In this practice, you will do the following: Define a journal line definition for accrual invoices. Assumptions Tasks Replace XX with your terminal number or initials. You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice. Responsibility selected to complete this practice is Payables, Vision Operations (USA). Log on to the system User Name = operations Password = welcome Responsibility = Payables, Vision Operations (USA) Define a journal lines definition 1. Navigate to the Journal Lines Definitions window: (N) Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Methods and Definition > Journal Lines Definitions 2. Create a new journal lines definition. 3. Save the definition code as XX_ACCRUAL_INVOICES. 4. Save the definition name as XX AP Accrual Invoices. 5. Apply the definition to all event types. 6. Assign the definition to the Operations Accounting Flex accounting chart of accounts. 7. Apply the journal line types previously created, XX Miscellaneous Expense and XX Liability. 8. Save your work. Subledger Accounting Overview Chapter 3 - Page 75

170 Solution Defining Journal Lines Definitions for Payables Defining Journal Lines Definitions Responsibility = Payables, Vision Operations (USA) 1. Navigate to the Journal Lines Definitions window. (N) Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Methods and Definition > Journal Lines Definitions The Find Journal Lines Definitions window appears. 2. (B) New. The Journal Lines Definitions window appears. Subledger Accounting Overview Chapter 3 - Page 76

171 The application name defaults from the application associated with the responsibility. The Owner field is automatically populated. For components seeded by Oracle, the value is Oracle. For components created on site by users, the value is User. The Enabled check box is enabled by default and makes the journal lines definition available for use for this application and the selected chart of accounts (if applicable). 3. In the Event Class field, select Invoices from the dropdown list. 4. In the Event Type field, select All. 5. In the Definition Code field, enter XX_ACCRUAL_INVOICES. 6. In the Definition Name field, enter XX AP Accrual Invoices. 7. Optionally, enter a description, for example, XX Accrual Invoices. 8. In the Accounting Chart of Accounts field, select Operations Accounting Flex. Subledger Accounting Overview Chapter 3 - Page 77

172 9. In the Journal Line Type field, assign the Expense journal line type you previously created to the event type by selecting XX Miscellaneous Expense. The Owner field is automatically populated based on the journal line type selected. 10. In the Line Description field, select Invoice Distribution Description. This is the journal entry description to be used to populate the subledger journal entry lines. 11. Ensure the Active check box is selected to use this line assignment to generate subledger journal entries. 12. In the Journal Line Type field, assign the Liability journal line type you previously created to the event type by selecting XX Liability. 13. In the Line Description field, select Invoice Distribution Description. 14. Ensure the Active check box is selected. The Journal Lines Definitions window should now look like this: Subledger Accounting Overview Chapter 3 - Page 78

173 15. Save the journal line definition: (M) File - Save Subledger Accounting Overview Chapter 3 - Page 79

174 Setup Application Accounting Definition Setup Application Accounting Definition After you define the rules for each event type of an application that you want to generate journal entries for, group them together under an application accounting definition. The application accounting definition or AAD, is the collection of journal entry rules for an application per specific accounting requirements or standards. For a corporation with activities in multiple geographies, for example, US and Europe, there are separate AADs for, say Payables, per the accounting standards in these geographies. There is a US GAAP AP AAD and an IFRS AP AAD. If the standards are the same for a particular event type, for example, for an invoice validation, then the same rule or JLD can be used under both the US GAAP and IFRS AP AADs. Subledger Accounting Overview Chapter 3 - Page 80

175 Setup - Application Accounting Definition Setup Application Accounting Definition Navigation: Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Methods and Definitions > Application Accounting Definitions After the definition is completed, the AAD is validated which basically ensures that the mandatory setup to generate an entry is defined appropriately. Subledger Accounting Overview Chapter 3 - Page 81

176 Setup Subledger Accounting Method Setup Subledger Accounting Method The subledger accounting method is the collection of accounting definitions for all the applications that you generate accounting for. Each primary and secondary ledger is associated with a SLAM, which determines the accounting rules and standards that are applied when generating entries for that ledger. Oracle seeds a number of accounting methods to support standard accrual, cash basis accounting, as well as accrual and cash basis encumbrance accounting and US Federal accounting. Subledger Accounting Overview Chapter 3 - Page 82

177 Setup - Subledger Accounting Method Setup Subledger Accounting Method Navigation: Setup > Accounting Setups > Subledger Accounting Setup > Accounting Methods Builder > Methods and Definitions > Subledger Accounting Methods In the hierarchy of the SLA Accounting methods builder, each component under a SLAM must share the same COA as the SLAM or be generic to COAs. Subledger Accounting Overview Chapter 3 - Page 83

178 Ledger Setup and SLAM Assignment Subledger Accounting Overview Chapter 3 - Page 84

179 Ledger Setup and SLAM Assignment Ledger Setup and SLAM Assignment If there is a secondary ledger defined, as the transaction is being processed for accounting, there is a separate journal entry generated for the primary and secondary ledgers, both according to the accounting method on each ledger. Subledger Accounting Overview Chapter 3 - Page 85

180 Setup Set Key Profile Options Setup Key Profile Options There are also a few key profile options that impact how accounting is generated through SLA in R12. These are mainly options that impact data access and security. For example: Should the general ledger data access set security be enforced when generating accounting, that is, should journal entries be created if the user does not have ledger clearance even if the user has multiorg access to the operating unit?. Should the transaction security model be applied when drilling down from GL; that is, should the user be allowed to inquire on journal entries of a certain operating units if the user does not have MO access, but has ledger clearance? If there are secondary ledgers and data access set security is enforced in the subledger module, then you must assign an additional data access set to the user to enable access to the secondary ledger. Should the user be able to run certain reports across the data of multiple subledger applications? In addition to these, there are other new profile options introduced in R12 for subledger accounting processing, that are mainly around troubleshooting. You can refer to the user documentation for more information. Subledger Accounting Overview Chapter 3 - Page 86

181 Agenda Subledger Accounting Overview Chapter 3 - Page 87

182 Implementation Considerations Implementation Considerations The slide shows the flow of information from a subledger application to General Ledger Subledger Accounting Overview Chapter 3 - Page 88

183 Summary Subledger Accounting Overview Chapter 3 - Page 89

184 Subledger Accounting Overview Chapter 3 - Page 90

185 Oracle E-Business Tax Overview Chapter 4 Oracle E-Business Tax Overview Chapter 4 - Page 1

186 Oracle E-Business Tax Overview Chapter 4 - Page 2

187 Oracle E-Business Tax Overview Oracle E-Business Tax Overview Chapter 4 - Page 3

188 Objectives Oracle E-Business Tax Overview Chapter 4 - Page 4

189 Agenda Oracle E-Business Tax Overview Chapter 4 - Page 5

190 Agenda Oracle E-Business Tax Overview Chapter 4 - Page 6

191 What is Oracle E-Business Tax (ebtax) What is E-Business Tax (ebtax) ebtax is a new product that provides the infrastructure for tax knowledge management and delivery using a global system architecture that is configurable and scalable for adding country specific tax content. As the single point solution for managing transaction-based tax, Oracle E- Business Tax uniformly delivers tax services to all E-Business Suite business flows through one application interface. Note to 11i customers: ebtax replaces the transaction tax solutions of Release 11i built into the Oracle Payables and Oracle Receivables products. It also eliminates the need for Brazilian Payables Tax solution (Brazilian AP/PO Tax). Latin Tax Engine of Release 11i for Order-to- Cash transactions of Brazil, Argentina and Colombia is still supported in Release 12. From an end users point of view, ebtax and the Latin Tax Engine are two mutually exclusive tax engines, but the Latin Tax Engine does leverage some services of Oracle E-Business Tax internally. Similar to Oracle E-Business Tax, tax lines calculated by Latin Tax Engine are also stored in ebtax Tables. Tax Reporting of Latin Taxes is now being done using ebtax s tax reporting ledger interface tables. Though ebtax is an entirely new product, customers upgrading from Release 11i are not required to re-implement their tax setup. You can continue to get the same tax calculation results as in Release 11i. Oracle E-Business Tax Overview Chapter 4 - Page 7

192 Agenda Oracle E-Business Tax Overview Chapter 4 - Page 8

193 Business Requirements Met by ebtax Business Requirements Met by ebtax Sales and Use Tax in Procurement Allows the definition of jurisdiction-based taxes, such as US Sales and Use Tax Allows you to leverage US Sales Tax setup configured in Receivable in 11i to be used in Payables Self-Assessed Tax in Payables Allows you to self-assess (reverse-charge) taxes on your Payables invoices Multiple Registrations Allows you to define multiple registrations for a Party or site for different taxes or jurisdictions Deferred Tax in AP ebtax allows you to account for recoverable taxes at the time and to the extent of payment in Payables, similar to behavior in Receivables in 11i Enhanced Handling of Tax on Freight Enhances handling of tax on Freight, with the ability to define different rules for freight Enhanced Exemptions and Exceptions Oracle E-Business Tax Overview Chapter 4 - Page 9

194 Allows you to define exemptions specific to a regime, tax or jurisdiction for a party Allows you to define exceptions specific to a regime, tax or jurisdiction by product fiscal classifications Multiple Inclusive, Compounding Allows you to define multiple inclusive taxes as well as supporting compounding taxes and surcharges (i.e., tax on tax) Quantity Based Rates in Procurement Allows the use of Quantity based Tax Rates to be unit based, e.g., $0.25 per US Gallon Oracle E-Business Tax Overview Chapter 4 - Page 10

195 Business Needs Solutions Oracle E-Business Tax Overview Chapter 4 - Page 11

196 Business Needs Solutions Oracle E-Business Tax Overview Chapter 4 - Page 12

197 Business Needs Solutions Oracle E-Business Tax Overview Chapter 4 - Page 13

198 Business Needs Solutions Oracle E-Business Tax Overview Chapter 4 - Page 14

199 Agenda Oracle E-Business Tax Overview Chapter 4 - Page 15

200 Key Concepts: Tax Authority Key Concepts: Tax Authority Tax Authority is a government entity that regulates tax law, administers, and/or audits one or more taxes. Some examples of Tax Authority: Brazil - Secretaria da Fazenda Estadual (State Revenue Office) Brazil - Secretaria da Receita Federal (Federal Revenue Office) California, USA - California State Board of Equalization Canada -Canadian Customs and Revenue Agency France - Ministry of Economy, Finance and Industry Germany - Federal Ministry of Finance India - Central Board of Customs and Excise Singapore -Inland Revenue Authority of Singapore United Kingdom - HM Customs and Excise Oracle E-Business Tax Overview Chapter 4 - Page 16

201 Key Concepts: Tax Regime Key Concepts: Tax Regime Tax Regime is the set of tax rules that determine the treatment of one or more taxes administered by a tax authority. Some examples of Tax Regime: Brazil - RICMS -> ICMS Regulation Brazil - RIPI -> IPI Regulation California, USA - California Sales Tax Canada - Canadian Goods and Services Tax India - Excise Tax Singapore - Singapore Goods and Services Tax United Kingdom - UK VAT Oracle E-Business Tax Overview Chapter 4 - Page 17

202 Key Concepts: Tax Key Concepts: Tax We can define Tax by a classification of a charge imposed by a government through a fiscal or tax authority. Some examples of tax: Tax Regime: Taxes: RICMS - Regulamento do ICMS ICMS, ICMS-ST (Tributary Substitution) RIPI - Regulamento do IPI IPI California Sales Tax State Sales Tax California Sales Tax District Sales tax Canadian Goods and Services Tax GST Canadian Sales Tax PST India Excise and Customs Excise Tax Singapore Goods and Services Tax GST UK VAT UK VAT Oracle E-Business Tax Overview Chapter 4 - Page 18

203 Key Concepts: Tax Jurisdiction Key Concepts: Tax Jurisdiction Tax Jurisdiction is a geographic area where a tax is levied by a specific tax authority. Some examples of Tax Jurisdictions: Tax Geographic Zone Jurisdiction ICMS São Paulo Sao Paulo ICMS IPI Brazil Brazil IPI State Sales Tax California (State) California State Sales Tax County Sales tax San Francisco (County) SFO County Sales Tax GST Canada Canada GST PST Ontario Ontario PST Excise Tax India India Excise Tax GST Singapore Singapore GST UK VAT UK UK VAT Oracle E-Business Tax Overview Chapter 4 - Page 19

204 Agenda Oracle E-Business Tax Overview Chapter 4 - Page 20

205 Architecture Overview Architecture Overview Oracle E-Business Tax consists of a tax knowledge base, a variety of tax services that respond to specific tax events, a set of repositories (for tax content and tax recording) that allow customers to manage their local tax compliance needs in a proactive manner, as well as the ability to integrate with external tax content providers through a single integration point. Oracle E-Business Tax Overview Chapter 4 - Page 21

206 Agenda Oracle E-Business Tax Overview Chapter 4 - Page 22

207 Processing Taxes for Transactions Processing Taxes for Transactions At transaction time, transactional applications within the Oracle E-Business Suite such as Purchasing, Payables, Sales, Receivables etc. pass determining factors to ebtax. Determining factors can also be derived from information available on the transaction and are the key building blocks of the tax rules. They fall into four groups: Parties: Information about the party such as party classification, registration, exemptions. For example: - Legal Entities - First and Third Party Ship From/To, Bill From/To, etc. - First and Third Party Tax Registrations, Classifications Places: Information on the geography of places associated with the transactions such as: - Party Locations - Define and Validate Party Locations Products: Information on the types of goods and services on the transaction such as: - Product Type (Physical Nature) - Item Categories Oracle E-Business Tax Overview Chapter 4 - Page 23

208 - Fiscal Classifications - Intended Use Processes: The types of transactions for which tax services are being requested, for example: - Document Type - Transaction Business Categories - Transaction Fiscal Classifications This information is passed to Oracle E-Business Tax through a single and uniform product interface. Then, ebtax: Determines tax regimes and applicable taxes. Determines Tax status. Identifies the appropriate tax rate belonging to the tax status and/or tax jurisdiction Calculates tax amount by multiplying the taxable basis by the tax rate. Stores calculated taxes the form of tax lines in the tax repository. These tax lines have all necessary information needed for tax reporting. At this point you can extract tax reports from the repository and display the date in formats such as PDF, HTML and RTF as required. Oracle E-Business Tax Overview Chapter 4 - Page 24

209 Tax Determination Services Example Tax Determination Services Example Shown here is a Receivables transaction. This example shows how Oracle E-Business Tax answers some basic business questions during its Tax Determination process. Tax Regimes are identified based on the countries of the parties involved. A default value or a Place of Supply rule indicates the Place of Supply. Oracle E-Business Tax Overview Chapter 4 - Page 25

210 Tax Determination Services Example Tax Determination Services Example A default party type value or a tax registration rule determines from which party (1st party or 3rd party) to evaluate tax registration status. The party classification is derived from the parties available in the transaction (1st and 3rd parties) and that classification can be compared to the ones used as tax determining factor in any rule type. Oracle E-Business Tax Overview Chapter 4 - Page 26

211 Tax Determination Services Example Tax Determination Services Example In the Transaction Lines window, other types of information are relevant for tax calculation: Quantity times Unit Price is the default seeded Taxable Basis formula, but other formulas can be defined. The item available in a given transaction line can potentially have one or more product classifications, and these classifications can be used as a tax determining factor in any rule type. The item itself or its classifications can also be used as part of Tax Exceptions definition. Oracle E-Business Tax Overview Chapter 4 - Page 27

212 Tax Determination Services Example Tax Determination Services Example In the Detail Tax Lines window, the Tax Rate times Taxable Basis is the default seeded Tax Amount formula, but other formulas can be defined. Oracle E-Business Tax Overview Chapter 4 - Page 28

213 Agenda Oracle E-Business Tax Overview Chapter 4 - Page 29

214 User Interface User Interface Home: Displays shortcuts to all required configuration set up tasks, including external dependencies. Tax Configurations: Use this tab to configure Tax Regimes, Taxes, Tax Statuses, Tax Jurisdictions, Tax Recovery Rates, Tax Rates, Tax Rules Products: Create and/or modify Product Classifications, Intended Use Classifications, and Tax Exceptions. A product fiscal classification is a classification of products, according to their tax requirements, for tax determination and tax reporting purposes. A product fiscal classification is based either on Oracle Inventory category sets or E-Business Tax product categories. Parties: Create and/or modify Party Tax Profiles, Party Classification, and Legal Classification Tax Usage Transactions: View and update Transaction Business Categories, Transaction Fiscal Classifications, Document Classifications, User Defined Transaction Classifications, Event Class Settings Defaults and Controls: Create and/or update Country Defaults, Tax Reporting Types, Configuration Owner Tax Options, and Application Tax Options Oracle E-Business Tax Overview Chapter 4 - Page 30