Professional Documents
Culture Documents
By karthikeyan
(Karthikeyanp1981@gmail.com)
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TABLE OF CONTENTS
Introduction
Accounting
>> Accounting in General
>> Accounting Concepts and conventions
>> Fundamental Accounting Assumptions
>> Types of Accounting Methods
>> Types of Accounts
>> Rules of Accounting
>> How journal entry is created.
>> Statutory Compliances
Subledger Accounting
>> What is Subledger Accounting
>> Need for Subledger Accounting
>> How SLA is different from the Accounting done in earlier releases?
>> Advantages of SLA in REL 12
>> New Features/Functionalities in Subledger Accounting
>> Subledger Accounting Structure
>> Modules that are covered by Subledger Accounting in Release 12
>> Types of Subledger Accounting Methods
>> Security Controls built in SLA
Reconciliatio
>> What is Reconciliation
>> Need for Reconciliation
>> Types of Reconciliation
>> Oracle suggested Reconciliation methodologies
=>Accounts Payables and General Ledger
=>Accounts Receivables and General Ledger
=>Assets and General Ledger
Functional Overview
>> New Concurrent Programs
>> New Standard Reports or Reports owned by SLA
>> New Profile Options
Technical Overview
>> Table Names
>> Accounting Packages
>> Menu
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Types of Accounts
In any company there will be a big list of chart of accounts used to record their business
transactions, however all the accounts can be classified under the following:
The three types of accounts are:
1) Real Account It represents assets and others that are real in nature, it can be
intangible also.
2) Personal Account These accounts are related to a person or an organization. They
are further classified as below:
a) Natural Person Human beings are referred here, for example Debtors or
Creditors
b) Artificial Person It refers to companies or any other organizations which are
treated as persons under law in force
c) Representative Personal Account It represents a single person or group of
Persons.
3) Nominal Account These accounts represents the profits and losses
Rules of Accounting
For every item that has been classified under the types stated above, needs to follow the
governing rules.
Real Account
Debit what Comes in
Credit what goes out
Personal Account
Debit the Receiver
Credit the Giver
Nominal Account
Debit all Expenses and Losses
Credit all Incomes and Gains
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Particulars
Debit
1000
Credit
1000
Statutory Compliances
Accounting as a process is governed by many different statute. Few are given below:
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APPLICATION ACCOUNTING
DEFINITION
JOURNAL LINE
TYPE
ACCOUNT DERIVATION
RULES
JOURNAL ENTRY
DESCRIPTIONS
SOURCES
TRANSACTION OBJECT
When you observe the Sub ledger accounting structure diagram given above, it is easy to
follow it from top-down approach, whereas when we actually define it in the system we
will be following Bottom-up approach.
So I will explain in the order Bottom to Top, so that it will be easier to correlate when
you are actually make a setup.
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Apart from above there are many more terminologies which we will be using frequently
in our discussion, will explain those terminologies as and when they appear.
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Assets
Cash Management
Costing
Federal Financials
Globalizations
Intercompany
Lease Management
Loans
Payables
Projects
Property Manager
Public Sector
Receivables
Payroll
Process Manufacturing
Of all the above modules, the 4 modules, which are highlighted, were the most frequently
used financial modules, and our discussion will be limited to these 4 modules only.
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RECONCILIATION
What is Reconciliation
Reconciliation is a process of comparing or cross checking the data between two different
sources. At Subledger level if a transaction becomes accounted, then it becomes eligible
for transferring to General Ledger module. After transferring the accounted data from
Subledger to General Ledger, one has to reconcile whether the data transfer is complete
and accurate
Need for Reconciliation
Common Reconciliation worries
Every company, which has implemented an ERP, will be under constant pressure during
the period end process and reconciling their Sub Ledger balances with the General
Ledger.
Let us see why we will have differences between Sub Ledgers and General Ledgers in
first place. There could be many reasons for it, we will discuss on the few which happens
frequently:
Instead of transferring all Entries from Sub Ledgers to General Ledgers,
there will be Entries, which are posted directly in General ledger manually
without taking the route of Sub Ledgers.
While closing the period, whenever any dispute arises, without solving the
same, sweeping it across the next period and just passing some adjustment
entries in general ledger to match that effect.
The golden rule is that Never enter any transactions in General Ledger that affects your
Sub Ledger. But in reality that is not the case, instead of arguing whether it is correct or
not to follow such practice, we must agree that it is not practically possible always to
route every transaction from Subledger.
In order to solve such differences in reconciliation we need to have control measures to
basic aspects, which is:
Prevent Entering Transactions in to General Ledger manually which is
related to Sub Ledger
Always transfer all Transactions from Sub Ledger to General Ledger
Now how to achieve this target?
By defining proper Segment qualifiers for a Natural Accounting segment. Many would
be aware of the available Segment qualifiers, for those who dont have an idea they are:
Allow Budgeting
Allow Posting
Account
Control Account (Termed as Third Party Control Account in Release 12)
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Report to be Run
Add
Less
External Reconciliation
General Ledger
Account Analysis(132 or 180) Report
Accounts Payable
=
AND
Liability account balance from Trial
Balance report
Particulars
Beginning Balance
Transactions Accounting
Data
Adjustments Accounting
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Accounting Report
Not Applicable
Sales Journal by Account
Adjustments Journal
Adjustment Register
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+/-
Data
Invoice Exceptions
Unapplied Receipts
Accounting Data
Applied Receipts
Accounting Data
Credit Memo Gain / Loss
Ending Balance
_
_
Not Applicable
Unapplied Receipts
Journal
Applied Receipts Journal
On Account Credit
Memo Gain and Loss
Journal
Not Applicable
Not Applicable
External Reconciliation
AR to GL Reconciliation Report
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Of the above the below mentioned program is more important which is why have
explained in detail for better understanding:
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Of the above the below mentioned report is more important which is why have explained
in detail for better understanding:
Open Account AP balances listing
This report replaces the Account Payable Trial Balance report which was used in
Released 11i. Now in Release 12, one needs to run this report in order to get the trial
balance information. The report has undergone many changes which resulted in new
setups and new parameters. The output of this particular report purely depends on how
the setup of Report Definition is done and also while running the report what account
code combination is provided as the liability account.
The report format will be published in pdf format with new look.
It is advised not to enable the AP Trial Balance report from system administrator and
reuse it in Release 12, instead please use the Open Account AP balance listing report.
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Of the above the below profile option is more important which is why have explained in
detail for better understanding:
SLA: Disable Journal Import
In earlier versions (11x), whenever there is a transfer of entries made from Subledger to
General ledger, it used to happen through in steps, as stated below:
Step 1 - Run Transfer to GL program from Subledger
Step 2 - Data will be transferred from Subledger to GL interface table
Step 3 - Run Journal import from General Ledger which will import the journals from
GL interface table to GL base tables.
Step 4 - Query the batches and then post the journals imported.
In Release 12, most of the above-mentioned steps remain the same, apart from STEP 2.
That is, by default, when you run the Transfer to GL program, it also performs the
Automatic Journal import program along with it, which results in no data lying in GL
Interface Program.
The reason why the interface tables are populated before hitting the base tables are to
make corrections or rollback the mistakes. All necessary corrections are carried out in
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XLA_SUBLEDGERS
The XLA_SUBLEDGERS stores information that depend on the application. It includes
a row for each application, standard or not, supported by XLA
XLA_SOURCES_B
The XLA_SOURCES_B table stores all sub-ledgers sources and sources customized by
user. These sources are used to create accounting rules and conditions
XLA_EVENT_SOURCES
The XLA_EVENT_SOURCES table stores all sources assigned to an event class or an
event entity.
XLA_CONDITIONS
The XLA_CONDITIONS table stores the conditions for an accounting line or header
types, segment rules and descriptions.
XLA_ACCTG_METHOD_RULES
The XLA_ACCTG_METHODS_RULES table stores the assignments for all Application
Accounting Definitions (AAD) within each Subledger Accounting Method.
XLA_EVENTS
This table performs the operations performed by AP_ACCOUNTING_EVENTS table in
earlier releases. In earlier release in order to find whether an accounting event is
processed completely or not, we can find out by the Status column, whereas in release
12, the table went through few changes, now the status of Event Status and Process Status
determines whether the event is accounted or not.
XLA_AE_HEADERS
Once the Accounting events generated in the XLA_EVENTS are processed then it will
generate the header level information of the accounting entry, under which the
accounting entry will be published.
XLA_AE_LINES
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XLA_ACCOUNTING_ERRORS
The XLA_ACCOUNTING_ERRORS table stores the errors encountered during
execution of the Accounting Program along with the description. The error saved in this
table is displayed in the Create Accounting Program output file.
XLA_DISTRIBUTION_LINKS
The XLA_DISTRIBUTION_LINKS table stores the link between transactions and
Subledger journal entry lines
ACCOUNTING PACKAGES
Of the many accounting packages that are delivered with every critical patch related to
Subledger accounting, sharing few important packages and its purpose.
SNO
1
2
3
PACKAGE
xlajejex.pkb
xlajelns.pkb
xlajebal.pkb
xlaapeng.pkb
XLA_ACCOUNTING_PKG
xlatbapt.pkb
XLA_TB_AP_REPORT_PVT
6
7
xlabacom.pkb XLA_BALANCES_PKG
xlaevevp.pkb XLA_EVENTS_PUB_PKG
PACKAGE DESCRIPTION
XLA Accounting Engine APIs
XLA Accounting Engine APIs
Public API for handling balancing
of Subledger Journal Entries
Package body for the Accounting
Program
XLA Trial Balance Report
Package for AP
XLA Balances Package
It contains all the APIs required
for processing accounting events.
MENU
The Menu of Subledger Accounting is embedded in every Subledger module; since it
does not have a module of its own.
The complete Subledger Accounting setup menu is saved under menu name
XLA_ACCOUNTING_SETUP
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In the above screen shot, you can observe that the Application field has the value
Receivables, which is hard, coded and cannot be changed. The value is determined based
on the responsibility from which it is accessed.
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SUBMENU
FUNCTION
NAVIGATION
MENU/SUBMENU/FUNCTION
>Subledger Applications
>> Accounting Methods Builder
>>> Events
>>>> Event Model
>>>> Process Categories
>>>> Accounting Event Class Options
>>> Sources
>>>> Sources
>>>> Source Assignments
>>>> Accounting Attribute Assignments
>>>> Custom Sources
>>> Journal Entry Steps
>>>> Journal Line Types
>>>> Journal Entry Description
>>>> Mapping Sets
>>>> Accounting Derivation Rules
>>>> Supporting References
>>> Methods and Definitions
>>>> Journal Line Definitions
>>>> Application Accounting Definitions
>>>> Subledger Accounting Methods
>>> Application Accounting Definition
Loader
>>>> History
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TABLE NAMES
AP_ACCOUNTING_EVENTS_ALL
Replaced by the table XLA_EVENTS
AP_AE_HEADERS_ALL
Replaced by the table XLA_AE_HEADERS_ALL
AP_AE_LINES_ALL
Replaced by the table XLA_AE_LINES_ALL
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Role of Consultants
Functional consultants who are normally familiar with the front-end forms may find it bit
difficult to carry out the setups relating to the Sub Ledger Accounting Method. However
they are responsible for putting the client accounting requirements in to Sub ledger
accounting rules. It would require basic programming knowledge, which helps in
thinking logically as to how the system would perform. Services of a Technical
Consultant can be used at discretion.
Normally there tends to be a GAP between the requirements collected by a functional
consultant and the end product delivered by a technical consultant, since both of them are
different in their thinking process. (Some times or often this leads to blaming each other)
However Release 12 made the process of defining a Sub Ledger Accounting in a userfriendly manner, which enables the Functional Consultant to carry out the complete
operation. Even though bit of programming knowledge will make thinks easier, but
nothing really mandates the need of a Technical Consultant.
(After the introduction of Release 12 i guess Functional consultants worked on this new
release are deserved to be known as Techno Functional Consultants!)
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Rollup Patches
Oracle Applications Release 12 has made out many rollup patches as of date. The more
and more the rollup patches gets released one can infer the following:
More problems are discovered in the product, which means product is not stable
Changes to the product are done to meet the requirements of customers at large.
One can apply these patches so as to avoid many errors, which have been
identified.
Rollup patches are not mandatory, at the discretion of the customer it can be applied or
not. However it is advised to be on the latest version.
Following are the roll up patches released so far:
Rollup Patch
Number
RUP 2
RUP 3
RUP 4
RUP 5
RUP 6
Patch Number
6048111
6272715
6510214
6836355
6728000
Related Metalink
Note
427410.1
454385.1
465284.1
577440.1
557869.1
Critical Patches
Critical patches are a group of fixes which are very vital for the system to perform in an
intended way. It is mandatory for any customer to apply this patch before reporting a
problem to Oracle for getting the support. Time and again at frequent intervals oracle
comes up with critical patch updates for every product.
Since this presentation is related to accounting i have listed patches, which takes care of
many accounting related issues.
Patch Number
6826219
7113955
7379106
7456652
7387254
Note: 742558.1
Note: 742330.1
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Patch Description
R12 : SLA CRITICAL ROLLUP AS OF FEB 19, 2008
R12 : SLA CRITICAL ROLLUP AS OF MAY 19, 2008
R12 Subledger Accounting Critical Patches September 2008
EBS: R12 Payables Critical Patch Collection November 2008
EBS: R12 Receivables Critical Patch Collection November 2008
EBS: R12 Assets Critical Patches September 2008
EBS: R12 General Ledger Critical Patches September 2008
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Diagnostic Patches
Oracle product by default provides many diagnostics tool for different modules, which
helps one to find out the issue and work towards the cause of the issue. Time and again,
these diagnostics are corrected and made more efficient to track the issue, these changes
come via patches. Listed details of few diagnostics patches:
Patch Number
6265820
6497339
7294700
Patch Description
CONSOLIDATED ACCOUNTING RELATED CHANGES
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Important Navigations
Being a new setup area, it will take time to get used to the new navigations that are
provided for Subledger setups. Its only by practice everything attains its perfection.
However in order to make things easier at the early stages I am providing you with details
as to how the menu is designed and seeded in to every Subledger module. Every menu
and submenu is inter-related.
Subledger Accounting Setup
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>> - Menu
>>> - Submenu
>>>> - Function
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Note Description
How to derive debug information for Subledger Accounting Issues
Oracle Subledger Accounting Release 12 Known Issues
R12 Accounting, GL Transfer, Period Close and Trial Balance 'How
To' documents
R12 Accounting FAQ's
R12 Accounting Errors Encountered FAQs
How to Locate the Latest R12 Product-Specific Information using New
Metalink Features
SLA: Accounting Data Missing from the SLA Tables
R12 Troubleshooting Accounting Issues
White Papers
Metalink Note
434226.1
578313.1
Note Description
Release 12 (R12) - Impact of Subledger Accounting (SLA) on General
Ledger (Drilldown and Journal Import)
Subledger Accounting in Oracle Assets
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How has to one link the accounting method to the Subledger module used, is there a
profile option?
All subledgers assigned to a ledger inherit the Subledger Accounting method assigned for
that ledger.
I need to stop all accounting related operations to one of my Subledgers, will that be
possible?
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I have created a new SLA method, which is used for all subledgers. In future if I
need to upgrade to higher version, does the new patches or codes affect my SLA
method created? Will I be required to recreate it again?
Definitions created by users are not overwritten by upgrades to Subledger Accounting.
However upgrades can still affect definitions if your Subledger Accounting method uses
the seeded components.
In case of Secondary ledgers how the system correlates between Transaction chart
of accounts and Accounting Chart of Accounts?
One has to perform Chart of Accounts Mapping between Transaction and Accounting
chart of accounts.
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POINTS TO REMEMBER
9 One can never be able to alter an seeded accounting method i.e. accounting
method owned by oracle, we can only take a copy of the seeded accounting
method and change the validations and insert rules, where ever it is appropriate.
9 Subledger accounting method created by Oracle cannot be modified or deleted.
9 Subledger accounting does not interfere with Auto Accounting or Workflow
Account Generator for account generation, which continues to perform the same
operations as it was in earlier versions.
9 One cannot define an illogical or impossible accounting rule since it allows you to
define, test and validate accounting rules; therefore, journal entries generated by
SLA have very little risk of error.
9 If you want to make changes to the standard seeded Subledger accounting
method, then you can make a copy of the available Subledger accounting and
make the necessary changes you wanted in it.
9 Whenever you make alteration to any rules to any of the components in Subledger
accounting, you need to validate your SLA method again, only then you can use
it, else it will throw an error.
9 The transaction and accounting charts of accounts are always the same for the
primary ledger.
9 The Subledger Accounting option is visible only for secondary ledgers in the
ledger options view described in Subledger Accounting Options Setup Pages.
9 Subledger Accounting will generate no entries for an application if Subledger
Accounting is disabled for the ledger.
9 Use Primary Ledger Amount field is only displayed for a secondary ledger if the
corresponding Subledger application has been enabled for Valuation Method.
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