Oracle General Ledger

Oracle Sub Ledger Accounting R12

Sicher Global Solutions SLA (Sub Ledger Accounting)Sub-Ledger Accounting (SLA) is functionality introduced by Oracle in R12 of the Oracle eBusiness Suite.We will be covering the following Topics in SLA: What is SLA? (i.e. an introduction to its functionality and concepts) How does it work? (i.e. system architecture, both process and configuration aspects) What can we do with it? (i.e. how it can be used to meet business requirements) What does it mean for the end-users? (i.e. reports, inquiries, month-end process and diagnostics)

SLA (Sub Ledger Accounting)In R12 the Set of Books concept was replaced with Ledgers; i.e. the 3 Cs became the 4 Cs:R12 the Set of Books concept was replaced with Ledgers; i.e. the 3 Cs became the 4 Cs:11iR12Set of Books Ledger

Chart of Accounts Chart of AccountsFunctional Currency Functional CurrencyCalendar CalendarAccounting Convention(SLA)

SLA (Sub Ledger Accounting) So for example it became possible to have the following:Primary Ledger using standard accrual as an accounting conventionSecondary Ledger - using a cash accounting convention

In this scenario when the user enters a supplier invoice into Accounts Payable, the followingaccounting impacts follow:Primary Ledger:Dr Expense (determined by Invoice Distribution)Cr AP ControlSecondary Ledger:no accounting impact

SLA (Sub Ledger Accounting)To provide this new functionality, Oracle introduced sub-ledger accounting, which is: Both a set of accounting rules and an engine to generate the accounting transactions A separate product with its own schema (XLA) to which accounting transactions are posted from each participating sub-ledger prior to being posted to the General Ledger2.(Although SLA is a separate product, it may be helpful to think of it as a service rather than a separate Application, since it is accessed via the existing sub-ledgers) Participating sub-ledgers include:Payables, Receivables, Projects ,Assets, Cash Management, Purchasing ,Cost Management, Process Manufacturing SLA (Sub Ledger Accounting)Using a single engine to derive accounting from all these sub-ledgers, standardizes the accounting process.The SLA engine also supports user defined (modified) accounting conventions which allow users to determine how the sub-ledgers derive the accounting. The screens used for this are called the Accounting Methods Builder (AMB). Configurations created via the AMB are much easier and transparent than equivalent modifications in previous eBS versions and are more easily supported. SLA (Sub Ledger Accounting)How it Works (Accounting Process): The following diagram shows how the participating sub-ledgers post through SLA to the General Ledger 4. This actually has quite significant impacts at Month-End (which we will come to later in this paper), however the diagram also indicates that the SLA forms a central transactional data repository with its own reports and inquiry windows. SLA PO CE PA FA AR AP CM GLAMB(Accounting Methods Builder)SLA (Sub Ledger Accounting) (Flow)Event Class(Invoices, Addition)Event Types(INVOICE ADJUSTED ,Addition)8SLA (Sub Ledger Accounting) (Flow)

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SLA: Elements of Journal (AMB)JLT : Control journal entry lines such as balance type and summarizationJED: Control the description for the journal entry headers and linesADR: Control the derivation accounting flexfield combinations for journal entry linesFA RequirementThe location value of expense distribution combination needs to be captured in Asset Cost journal entry The cost center/dept segment value should default 999999 when asset is retired

Solution 1:Define new JLD (Journal Line Definition) for Event Class = AdditionDefine new JLT (Journal Line Type) for Addition Cost3.Define new ADR rule for location segment for Event Class=Addition and JLT=Addition CostSolution 2:Define new JLD (Journal Line Definition) for Event Class = RetirementDefine new ADR rule for cost center segment for Event Class = Retirement and JLT = Retirement CostFA Example11FA Seeded ADR for JLD= Addition JLT = Asset CostSegmentRule NameOwnerDescriptionAll SegmentsAssets Book Default AccountOracleAssets Book Default AccountBalancing SegmentAssets Expense Account SegmentOracleAssets Expense Account SegmentNatural Account SegmentAssets Categories Cost Account SegmentOracleAssets Categories Cost Account Segment

FA seeded Accounting generation12SLM: STANDARD_ACCRUAL (seeded)

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Define Custom SLAM by copy from seeded

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After Copy (optional Transaction / Accounting COA)

152.Application Accounting Definition (copy from Seeded)

162.After Copy (optional Transaction / Accounting COA)

173.Journal Line Definition (copy from Seeded)

183.Journal Line Definition (After copy)

194.Journal Line Types (copy from Seeded)

205. Copy Line Assignments (copy from Seeded)

216. Disable Oracle JLT and activate Custom JLT

227. Journal Line Descriptions (copy from Seeded)

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8. Modify Journal Line Descriptions

249. Attach JLD to JLT

2510.Modify ADR for Additions

2611. Copy ADR

2712. Modify ADR

2812. Modify ADR

2912. Modify ADR - Conditions

3012. Modify ADR - Retirement

3113. Assign to Custom SLA to Ledger

3213. Assign to Custom SLA to Ledger

33AP RequirementMake a rule something like if the Expense Distribution is for employees or the invoice is for employees then only accounts starting with '6% or default 6100 should be allowed in the invoice, otherwise no other accounts will be allowed

Solution:Define new JLD (Journal Line Definition) for Event Class = InvoiceDefine new ADR rule for account segment for Event Class=Invoice and JLT=Item Expense

What SLA can doAbove requirement is possible through SLA. Make rules to default values that are listed out based on some conditions. If any accounts entered other then 6% series Accounting Program will give you a warning and invoice will not be accountedCisco Requirements: AP Example341. Modify Application Accounting Definition

351. Modify Application Accounting Definition

362. Define Journal Line Definition

373 Define Journal Line Type (copy from seeded)

384. Define Account Definition Rules

394. Define Account Definition Rules contd

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SLA : Process changeIn 11i Balancing entries are created in GL after period closeIn 12 Balance entries are created in SLA before period close and when transactions are accounted

42 SLAMis the list of Application Accounting Definitions per sub ledger that can then be linked to the ledger.

AAD Application Accounting Definition to form the complete set of rules per event for the sub ledger. This summary of the set of rules needs to be validated before it can be linked to the Sub ledgerAccounting Method for the sub ledger.

AMB The Accounting Methods Builder (AMB) comprises of three elements: The Journal Line Type (JLT), the Journal Entry Description (JED) and the Account Derivation Rule (ADR). It allows a user to create and modify journal entry setups determining the Debit and Credit ADR Account Derivation Rule These are the rules that determine from where an accounting flexfieldvalue is taken or how it is derived. Oracle does provide seeded rules, however one can create ones own rules to derive accounting flexfield segment values

JLTOne of the building blocks of an accounting definition. Journal line types are defined in theAccounting Methods Builder and include options necessary to convert transaction data into subledger journal entries.

JLDA group of line assignments for an event class or event type.

SLA : Definitions 43The ability to generate the accounting entries for respective sub ledgers in Draft mode or Final mode. Automate account generation, which can be based on a number of inputs Enables compliance with multiple accounting requirements concurrently in a single instance or even across database instances. Journal Entry Description can be tailored to include the information the business requires for downstream processingAccurate Accounting: SLA specifically addresses those accounting issues that relate to a string of events or a transaction flow by remembering the original account that was used in the initial event (i.e., invoicing), and ensuring that the same account is reversed during the subsequent event (i.e., payment). Online Accounting: Launch accounting directly from transactions window to initiate real-time, single step posting to all relevant ledgers (primary, secondary and reporting ledgers)Preview Accounting: Allowing you to preview the journal entries impacted by the transaction before actually post it. Controlled Accounting: Designate any account as control account, this flag prevents GL manual posting from postingSLA : Benefits44SLA : ComparisonGeneral LedgerRelease 11iRelease 12 Accounting Model is separated from TransactionsOracle PayableOracle AssetsOracle PurchasingSub ledger modulesGeneral LedgerAP Rules & ADROA Rules & ADRPUR Ruels & ADRSub ledger AccountingOracle PayableOracle AssetsOracle PurchasingSub ledger modules45

SLA : AMB Components

SLA: Setup Flow (Bottom approach)SLA: Multiple Accounting Representations