Copyright © DARC Corporation, 20101
O l R12 I tOracle R12 Intercompany
Stan Korwin
DARC CorporationDARC Corporation
NCOAUG August 20, 2010
Copyright © DARC Corporation, 20102
DARC Lines of Business
• Consulting Services• ProgramManagement Functional Technical
• Production Support• 24x7 Functional & DatabaseProgram Management, Functional, Technical,
Architecture 24x7 Functional & Database
• Accelerators for Interfaces and Conversions• Organizational Change Management
• Communications, Documentation, Training
• Accelerators for Interfaces and Conversions
• Mergers & Acquisitions
• Global Consolidation
Copyright © DARC Corporation, 20103
Agenda
• What Is Intercompany?
k?• How Does It Work?
• Important Concepts
• How To Set It Up?
• Q & AQ & A
Copyright © DARC Corporation, 20104
What is Intercompany?
Functionality to create, manage, reconcile and report transactions among multiple p g porganizations and entities across EBS
Copyright © DARC Corporation, 20105
New Features forIntercompany TransactionsIntercompany Transactions
• Ability to create invoices• Ability to create invoices
• Multiple recipients support• Multiple recipients support
• Proration of transaction distribution amounts• Proration of transaction distribution amounts
U l d T ti B t h t d i E l• Upload Transaction Batches created in Excel
Copyright © DARC Corporation, 20106
Intercompany TransactionsB fit
• Ability to create invoices in subledger
Benefits
Ability to create invoices in subledger
• Multiple recipient transactions
• Automatic intercompany accounting• Automatic intercompany accounting
• Descriptive Flexfield support
• Web ADI integration• Web ADI integration
• Period status controls transaction processing
Copyright © DARC Corporation, 20107
Intercompany ReconciliationBenefits
• Increases company efficiency by shortening the close
Benefits
cycle • Reduces costs by automating a largely manual and l b ilaborious process
• Supports global enterprise by allowing to reconcile across ledgers and charts of accountsacross ledgers and charts of accounts
• Offers better information by providing insight into the sources of intercompany differences
• Delivers process innovation by allowing reconciliation any time on selected level of detail
Copyright © DARC Corporation, 20108
How Does It Work?
Pretty well actually…y y
Copyright © DARC Corporation, 20109
Intercompany TransactionsProcessProcess
• Transfer approved transactions to General LedgerTransfer approved transactions to General Ledger – Online: Workflow transfers the transaction– Batch: Run ‘Transfer Intercompany Transactions to General Ledger program’
• Transfer approved transactions to AR and AP O li W kfl t f th t ti– Online: Workflow transfers the transaction
– Batch: Run ‘Transfer Intercompany Transactions to AR program’AR program
– Batch: Run ‘Transfer Intercompany Transactions to AP program’
Copyright © DARC Corporation, 201010
p g
Intercompany TransactionsProcess Web ADIProcess – Web ADI
Enter transactions in a spreadsheet and upload them into Oracle Intercompany
Spreadsheet D t E t
Web ADI Generate Templates Upload, Oracle
I tData EntryGenerate Templates Validation Intercompany Transactions
Copyright © DARC Corporation, 201011
Intercompany TransactionsProcess Open InterfaceProcess – Open Interface
Import the external intercompany transactions into Oracle Advanced Global Intercompany System
I tE ternal Data loaded Validated DataImportValidations
External Data loaded into FUN_Interface
Validated Data imported to FUN
tables
FUN_INTERFACE TablesExternal Data Intercompany Transactions
Copyright © DARC Corporation, 201012
Intercompany Reconciliation Process ReconciliationProcess – Reconciliation
DrillDown
Copyright © DARC Corporation, 201013
Intercompany Reconciliation Summary by SourceSummary by Source
Copyright © DARC Corporation, 201014
Intercompany Transaction Summary ReportSummary Report
Copyright © DARC Corporation, 201015
Important Concepts
Balance is Good…Balance is Good…
Copyright © DARC Corporation, 201016
Intercompany and Intracompany BalancingBalancing
BALANCING API
IntracompanyBalancing Rules Post
JournalsCreate
Accounting
Intercompany Accounts GeneralLedger
SubledgerAccounting
ArchitectureArchitecture
Copyright © DARC Corporation, 201017
Intercompany and Intracompany Balancing
• What are the trigger points for generating balancing
Balancing
What are the trigger points for generating balancing entries?– GL Posting
– Subledger Journal Creation
• How are balancing lines created?How are balancing lines created?– Journal Mode
• 1 to 1
• 1 to Many
• Many to 1
• Many to Many
Copyright © DARC Corporation, 201018
y y
Intercompany and Intracompany Balancing ProcessBalancing Process
Wh t h if I t d I t• What happens if Intercompany and Intracompany lines are mixed on a transaction?
• What differences exist between Intercompany and• What differences exist between Intercompany and Intracompany balancing?– Different AccountsDifferent Accounts
– Summarization of Balancing Lines
– Use of a Clearing Company
– Processing Many to Many Journals
Copyright © DARC Corporation, 201019
Intercompany and Intracompany Balancing Process ExampleBalancing Process – Example
Balancing Rule Journal
Dr BSV
Cr BSV
Debit Account
Credit Account Journal Mode: 1-1
01 02 01-4102-02 02-2201-01
02 01 02-4201-01 01-2102-02
03 5400.00 Original Line
10 5400.00 Original Line
01 All Other 01-4100-99 99-2200-01
All Other 01 99-4200-01 01-2100-99
03-4000-10 5400.00 Dr. Balancing
Line
10-2000-03 5400.00 Cr. Balancing
LineOther
All Other All Other 99-4000-99 99-2000-99
2000 03 Line
Copyright © DARC Corporation, 201020
Intercompany and Intracompany Balancing Process Example
Setup for LE1Journal
BSV 10 maps to LE 1. BSV 20 maps to LE 2
Balancing Process – Example
From LE 1: Corporate Ledger: Corporate COA
To Account Type
Journal
Journal Mode: 1-1
10
LE2 10-2000-20 Intercompany Payables Account
10-5200-00 1800.00 Original Line
20-5000-00 1800.00 Original Line
S t f LE210-2000-20 1800.00 IC Payables to
LE 2 (BSV 20)
20- 1800 00
ICReceivables
From LE 2: Corporate Ledger: Corporate COA
Setup for LE2
4000-10 1800.00 Receivables from LE 1 (BSV 10)
To Account Type
LE1 20-4000-10 Intercompany Receivables Account
Copyright © DARC Corporation, 201021
Intercompany TransactionsDependencies and InteractionsDependencies and Interactions
• DependenciesDependencies– Legal Entity to be defined and associated to Ledger
• Interactions– Receivables – creation of invoice for outbound t titransactions
– Payables – creation of invoice for inbound transactionstransactions
– General Ledger –accounting for non invoicing intercompany transactions
Copyright © DARC Corporation, 201022
p y
How To Set It Up
Very Carefully…
Copyright © DARC Corporation, 201023
Intercompany Benefits
• Simplified maintenanceSimplified maintenance
• Enhanced Control of intercompany transactions
• Integration of Accounting Setup With Accounting• Integration of Accounting Setup With Accounting Setup Manager
• Migration of Profile Options to simpler SystemMigration of Profile Options to simpler System Options page
• Seeded default Setup Options, so operable out of the p p , pbox
Copyright © DARC Corporation, 201024
Intercompany Setup and Process
Setup intercompany
SETUP PROCESS
Open intercompanyi d
Setup security and approvers
Create intercompany transactions
organizations period
pp
Define transaction types
Approve intercompanytransactions
Transfer intercompany
Setup invoicing options
Transfer intercompanytransactions
Reconcile intercompanytransactions
Close intercompany period
Setup system options
Copyright © DARC Corporation, 201025
Intercompany Setup 1I t O i tiIntercompany Organizations
• Define Intercompany organizations toDefine Intercompany organizations to represent Internal Trading organizations
• Relate Intercompany organization to Legal• Relate Intercompany organization to Legal Entity
R l I i i• Relate Intercompany organization to Operating Unit ‐ optional
Copyright © DARC Corporation, 201026
Intercompany Setup 2SecuritySecurity
• Define Security and ApproversDefine Security and Approvers– security set up maps trading partners to users
– user can access to many intercompany organizations
• Example: Intercompany accountant processes intercompany transactions for many intercompany organizations in the enterprise.– R11i ‐ Each responsibility has only one subsidiary assigned, therefore a user
can initiate intercompany transactions for one subsidiary from eachcan initiate intercompany transactions for one subsidiary from each responsibility
– R12 – the user can initiate intercompany transactions for many trading partners without changing responsibility
Copyright © DARC Corporation, 201027
p g g p y
Intercompany Setup 3Intercompany AccountsIntercompany Accounts
• Define Intercompany AccountsDefine Intercompany Accounts– Provides the ability to define and update the Intercompany Accounts for each Legal EntityIntercompany Accounts for each Legal Entity within their corporate enterprise. The ability to define and update Intercompany accounts is key to eliminating Intercompany transactions during the consolidation process
Copyright © DARC Corporation, 201028
Intercompany Setup 4TransactionsTransactions
• Define transaction types to group transactionsDefine transaction types to group transactions logically to simplify processing
• Choose to create invoices for some transaction types ypto comply with legal requirements
• Speed up the approval process by making it p p pp p y gautomatic
• Close Periods by Transaction Types to give more control over processing and faster period close
Copyright © DARC Corporation, 201029
Invoicing Options Setup 5
• Specify the receivables invoice Transaction Type andSpecify the receivables invoice Transaction Type and Standard Memo Line used to create Intercompany Sales Invoice to suit specific business needs
• Define Trading Partner relationships to specify existing Customers and Suppliers for invoices created in subledgers
• Create new Customers and Suppliers and relate them dto Trading Partners
Copyright © DARC Corporation, 201030
System Options Setup 6
• Select manual or system‐generated batch numberingSelect manual or system generated batch numbering
• Choose Intercompany Currency to standardize processing of intercompany transactionsp g p y
• Exclude immaterial transactions by choosing a minimum transaction amount
• Choose a minimum transaction amount currency
Copyright © DARC Corporation, 201031
System Options Setup 7
• Select exchange rate type for consistent conversionSelect exchange rate type for consistent conversion of foreign‐currency transactions
• Allow or disallow the rejection of intercompany j p ytransactions by recipient
• Choose to transfer transactions in batch or online to Oracle General Ledger or subledgers
• Select Intercompany Calendar
Copyright © DARC Corporation, 201032
Open / Close Periods Setup 8
• Maintain period status per Transaction TypeMaintain period status per Transaction Type
S i b f l i• Sweep transactions before closing
Copyright © DARC Corporation, 201033
Intercompany and Intracompany S
• Intercompany accounting
Summary
Intercompany accounting
• Intracompany balancing
C li d d h d f• Centralized and shared setup of Intercompany Accounts and Intracompany B l i R lBalancing Rules
• Balancing entries can be created in General Ledger and in Subledgers
Copyright © DARC Corporation, 201034
Intercompany TransactionsSummary
Intercompany transactions is now enhanced
Summary
process:
• Support for Intercompany InvoicingSupport for Intercompany Invoicing
• Transactions can be entered for multiple recipientsrecipients
• Flexible Security model
• Control timing with Intercompany Periods
• Web ADI integration
Copyright © DARC Corporation, 201035
Questions?
Copyright © DARC Corporation, 201036
Thank You!
S iStan Korwin
877‐476‐7151877 476 7151
Copyright © DARC Corporation, 201037
Copyright © DARC Corporation, 201038
Recommended