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The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any.

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Presentation on theme: "The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any."— Presentation transcript:

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

3 E-Business Suite R12 Cost Accounting Integrated with SLA Diane Streubel – Schreiber Foods Cost Manager Douglas Volz – OAUG Discrete Cost SIG Sub-Committee Herve Yu – Oracle Costing Development

4 Oracle Process Costing MAC transitioning to SLA Oracle Discrete Costing SLA enhancements Case example: Discrete Costing-Product Line Accounting Costing Accounting Integrated with SLA Agenda

5 Oracle Process Costing MAC transitioning to SLA Schreiber Foods Diane Streubel Manager - Cost & System Development

6 Converged inventory model Inventory Organizations that are Process will use Process Costing Process users are denied access to Discrete Costing forms Process Enabled organizations can not setup costs in the Discrete Costing application Sub Ledger Architecture (SLA) replaces MAC Costing Accounting Integrated with SLA OPM MAC transitioning to SLA

7 Cost SetupCalculate CostStore Costs MAC Oracle GL GMI (OPM Inventory) PurchasingGMD, GME Order Management 11i OPM Costing Accounting Integrated with SLA OPM MAC transitioning to SLA

8 Cost SetupCalculate CostStore Costs SLA Oracle GL Oracle Inventory PurchasingGMD, GME Order Management R12 OPM Costing Accounting Integrated with SLA OPM MAC transitioning to SLA

9 Subledger accounting is an intermediate step between subledger products and the Oracle General Ledger Each transaction that requires accounting is represented by a complete and balanced subledger journal entry, stored in a common data model. Costing Accounting Integrated with SLA OPM MAC transitioning to SLA

10 SubledgerGL ExportJournal ImportJournal Posting InterfaceInterface General Ledger For G/L integration, discrete costing works the same as OPM costing Costing Accounting Integrated with SLA OPM MAC transitioning to SLA 11i OPM

11 Payables Receivables Projects Oracle Subledger Accounting Oracle General Ledger OPM R12 OPM For G/L integration, discrete costing works the same as OPM costing Costing Accounting Integrated with SLA OPM MAC transitioning to SLA

12 OPM MAC Completed material and/or resource transactions. OPM Costing Engine generates costs. OPM Subledger process processes these transactions to create Journal entries SLA Cost Pre-processor will create accounting Events SLA accounting program processes the events to create the journal entries Completed material and/or resource transactions. OPM Costing Engine generates costs. Costing Accounting Integrated with SLA OPM MAC transitioning to SLA

13 OPM MACSLACOMMENTS Fiscal PolicyRetained with few modifications Event Fiscal PolicyRetained with few modifications SourceProcess Category EventEvent Entity Sub-EventEvent Class Account TitlesJournal Line Types (JLT) Accounting TemplateApplication Accounting Definitions (AAD) Users can define their own AADs or modify seeded information Account Mapping Attributes(SLA) SourcesSLA sources are used in ADRs Priorities and Account Mapping Account Derivation Rules (ADR)More flexible. Mapping can be done at Accounting flexfield level as well as segment level Test MappingTest Accounting Builder (TAB) OPM Currency, OPM Ledger, OPM Exchange Rates Use GL setups Costing Accounting Integrated with SLA OPM MAC transitioning to SLA – Setup Forms

14 OPM MACSLACOMMENTS Test and Actual Subledger Accounting Draft and Final Accounting Subledger ProgramAccounting Pre-Processor Run Subledger for multiple valuation/cost methods for a ledger Supports multiple valuation methodsIn OPM there can only be one representation at a time. SLA supports multiple representations at the same time Run Subledger process for a functional area Run Pre-Processor by Process Category Flexible. User can have any number of categories. Assigned to one or more event classes Detailed Subledger ReportIs retained and has been modified to use SLA repository Costing Accounting Integrated with SLA OPM MAC transitioning to SLA - Reports

15 Most of the steps are automated using migration scripts All the Account Definitions would be migrated as ADRs Manual Steps to be completed are: Assign Account Derivation Rules to Journal Line Definitions Validate Application Accounting Definition Assign User Subledger Accounting Method to Ledger Costing Accounting Integrated with SLA OPM MAC transitioning to SLA

16 Costing Accounting Integrated with SLA OPM MAC transitioning to SLA - Process

17 NO LOSS of functionality by moving to SLA model A new sub-menu created under Cost Management for SLA forms. Fiscal Policy and Event Fiscal Policy screens retained with minor modifications. Most of the fields will be read-only. OPM Event model mapped to SLA event model. Costing Accounting Integrated with SLA OPM MAC transitioning to SLA - Summary

18 Oracle Discrete Costing SLA Enhancements OAUG Discrete Cost SIG Sub-Committee Douglas Volz Douglas Volz Consulting, Inc.

19 Release 11i account recognition “pain points” eliminated by SLA: SLA removes limitations for recording COGS and Revenue (still uses Cost Account Generator/workflow and A/R AutoAccounting) Recording inventory and WIP accounts with more flexibility Flexible variance account recognition for: Invoice price variance Purchase price variance Average cost adjustment Standard cost adjustment Manufacturing variances Account aliases Freight charges And most other inventory, manufacturing and related account entries Costing Accounting Integrated with SLA Increased Flexibility: Oracle Discrete Costing SLA

20 Event Model: definition of the subledger transaction types and lifecycle Entity : Classification of source of transaction Event Class: Classifies transaction types for accounting rule purposes Event Type: for each transaction type, defines possible actions with accounting significance ENTITYMaterial Transaction, Receiving or WIP or Write Off EVENT CLASS Logical grouping of events which have similar kind of accounting EVENT TYPE The most granular level of business event which has accounting impact Sub Ledger Accounting(SLA) Key Concepts

21 JOURNAL ENTRY SETUPS Define/copy and modify journal line types Define/copy and modify account derivation rules Define/copy and modify descriptions PROCESS Enter Transaction(s) Cost Manager Create Accounting*Transfer Journal Entries to GL *Run ‘Create Accounting – Cost Management’ concurrent request for accounting all transactions from the Cost Management – SLA responsibility. Receiving Accounting can be generated in the Purchasing responsibilities using the ‘Create Accounting – Receiving’ concurrent request. These requests have an option to transfer the entries created to General Ledger. A separate process is also available. Sub Ledger Accounting(SLA) Setup and Process

22 Transactions Accounting Events Cost Management SLA Accounting Configurations Subledger Balances Subledger Journal Entries Accounting Program Journal Entry Setup GL Journal Entries and Balances Sub Ledger Accounting(SLA) Setup and Process

23 Case Example: Discrete Costing- Product Line Accounting Oracle Corporation - Discrete Costing Development Herve Yu Senior Principal Engineer

24 Example: Record Purchase Price Variance by Product Line We have two brands of cell phones, Samsung and Nokia We want to track variances by cell phone brands We are going to use 2 different ways to address this same requirement Cost/SLA mapping set capability Category Accounting – Cost/Global Accounting migrated to SLA in R12.1 A word for Inventory period close and Cost/SLA upgrade Costing Accounting Integrated with SLA Case Example: Purchase Price Variance product Line

25 Cost/SLA mapping set capability

26 Product Line Setup Steps Set up your product line using SLA mapping set 1.Enter your SLA account derivation rule for Purchase Price Variance accounts 2.Associate the new account derivation rule to your Journal Line Type 3.Associate the Application Accounting Definition with Subledger Accounting Method Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

27 Product Line Accounting – Descriptive flexfield Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

28 Product Line Accounting – Descriptive flexfield Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

29 Mapping set – Account Derivation Rule Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

30 Mapping set – Account Derivation Rule Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

31 SLA Journal Line / Derivation Rule Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

32 Associate Journal Lines Definition to the Event Class Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

33 Note the same ADR is usable for Standard Cost Update Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

34 Note the same ADR is usable for Standard Cost Update Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

35 Associate SLA Definition to the SLA Method/Ledger Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

36 Assign product line code to the inventory item Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

37 The material subledger from 11i still exists Inventory PPV Inventory Receiving Matl Overhead Absorption Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

38 SLA Entries That Go to Your G/L Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

39 For the Standard Cost Update That Go to Your G/L Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line

40 Category Accounting – Cost/Global Accounting migrated to SLA in R12.1

41 Costing Accounting Integrated with SLA Product Line Category Accounting:Global Accounting Create a new structure under the key flexfield “Item Category”

42 Costing Accounting Integrated with SLA Product Line Category Accounting:Global Accounting Create a new structure under the key flexfield “Item Category” Create category codes

43 Costing Accounting Integrated with SLA Product Line Category Accounting:Global Accounting Create a new structure under the key flexfield “Item Category” Create category codes Create category set

44 Create a new structure under the key flexfield “Item Category” Create category codes Create category set Assign “Product Line Accounting” functional area category set Costing Accounting Integrated with SLA Product Line Category Accounting:Global Accounting

45 Product Line category account Costing Accounting Integrated with SLA Product Line Category Accounting:Global Accounting

46 Account Derivation Rule would have used a source directly Costing Accounting Integrated with SLA Product Line Category Accounting:Global Accounting

47 Summary Notes Product line accounting can be achieved in many ways without using Costing Hook. In R12 SLA is the Oracle R12 accounting platform and Costing supplies application sources from INV,WIP,RCV… to build the accounting journals. One caveat: Pre-Release 12 subledger accounting reports are reading data from Costing distribution layer (such as the Material Account Distribution Summary or Detail Reports). Those reports will not show SLA journals. SLA provides a set of new accounting reports (such as Journal Entries Report, Accounting Analysis Report…) which can be modified as desire using BI Publisher. Costing Accounting Integrated with SLA Case Example - Conclusion

48 Inventory Period Close Process Inventory interim G/L transfer has been replaced by SLA The Inventory Accounting Period close works just like it did before, however, SLA now sends accounting information to the general ledger Upgrade Process Customers have option of migrating the whole historical data to SLA or choose which periods data to be migrated. Customers get option to either upgrade in downtime when upgrading or anytime after the upgrade process. Default for Cost management is to migrate the present calendar year data to SLA. Costing Accounting Integrated with SLA Inventory Period Close and Upgrade

49 Additional information are available: R12 Oracle Subledger Accounting – Implementation Guide R12 Oracle Cost Management – User Guide R12 Oracle Process Manufacturing Cost Management - User Guide Costing Accounting Integrated with SLA

50 THANK YOU


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