multiperiod accounting in oracle ebs r12

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#C14LV REMINDER Check in on the COLLABORATE mobile app #C14LV R12 Subledger Accounting Cookbook Multi Period Accounting NCOAUG Training Day August 14, 2014 Prepared by: Prithis Das Dynamique Solutions LLC

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A deep dive into the Multiperiod Accounting functionality using Subledger Accounting configurations in Oracle EBS R12

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Page 1: Multiperiod Accounting in Oracle EBS R12

R12 Subledger Accounting Cookbook

Multi Period Accounting

NCOAUG Training Day

August 14, 2014

Prepared by:Prithis DasDynamique Solutions LLC

Page 2: Multiperiod Accounting in Oracle EBS R12

Presenter’s background

■ Oracle Applications experience goes back to 1997■ Over 22 years of business process improvement experience■ Consulting experience with Big 5 and other major

organizations■ Oracle Certified Specialist in General Ledger■ Chartered Accountant and Management Accountant from

India■ Authored and presented papers on SLA, WebADI, Reports

Manager and other topics at several OAUG and local events■ Just completed a major R12 upgrade and working on a Cash

Basis Secondary Ledger implementation■ Contact:

▪ Cell: 630.3649457

▪ Email: [email protected]

▪ Web: Dynamiquesolutionsllc.com

Copyright Prithis DasDynamique Solutions LLC

Page 3: Multiperiod Accounting in Oracle EBS R12

Agenda

■ Introduction to Multi Period Accounting■ Typical Prepayment Process■ Prepayment Scenario■ Multiperiod Accounting Setups – Optional Setups■ SLA Setups for Multiperiod Accounting■ Transaction Processing using MPA■ Implementation Considerations■ References■ Q&A

Copyright Prithis DasDynamique Solutions LLC

Page 4: Multiperiod Accounting in Oracle EBS R12

Introduction to Multi Period Accounting

Copyright Prithis DasDynamique Solutions LLC

Page 5: Multiperiod Accounting in Oracle EBS R12

■ What is Multiperiod Accounting?▪ Multiperiod accounting enables users to create accounting for a

single accounting event for more than one GL period. The functionality is primarily used to recognize revenue or a prepaid expense or revenue across multiple GL periods.

■ Uses of Multiperiod Accounting▪ Automated recognition of Prepaid AP invoices

▪ AR Revenue recognition

▪ Can be used in Primary as well as Secondary Ledgers (for Management reporting)

■ This presentation focuses on recognizing prepaid expenses across multiple GL periods.

IntroductionCopyright Prithis DasDynamique Solutions LLC

Page 6: Multiperiod Accounting in Oracle EBS R12

Typical Prepayment Process

Copyright Prithis DasDynamique Solutions LLC

Page 7: Multiperiod Accounting in Oracle EBS R12

■ Typical Prepayment process without Multiperiod Accounting▪ Setup/maintain Special Calendar

▪ Setup Distribution Set

▪ Create Prepayment invoice

▪ Pay Prepayment invoice

▪ Create Recurring invoice template for expense amortizations

▪ Generate Recurring invoices

▪ Apply to Prepayment Invoice each month – manual process

▪ Run Create Accounting/Transfer to GL

▪ Use Prepayment Status Report.

Typical Prepayment ProcessCopyright Prithis DasDynamique Solutions LLC

Page 8: Multiperiod Accounting in Oracle EBS R12

■ Typical Prepayment process with Multiperiod Accounting▪ Setup Multiperiod Accounting in Subledger Accounting

▪ Create Standard invoice— Complete Deferred fields during invoice entry

▪ Pay Standard invoice to pay the prepayment

▪ Run Create Accounting/Transfer to GL

▪ Use Multiperiod Accounting and Accrual Reversal Report

▪ Periodically run Complete Multiperiod Accounting program

Typical Prepayment ProcessCopyright Prithis DasDynamique Solutions LLC

Page 9: Multiperiod Accounting in Oracle EBS R12

Prepayment ScenarioCopyright Prithis DasDynamique Solutions LLC

Page 10: Multiperiod Accounting in Oracle EBS R12

■ Prepayment for Software Support▪ A company prepays annual software maintenance of $12,000

on June 25th , 2014. The company needs to expense $1,000 each month for 12 months according to the following schedule:

Scenario

Copyright Prithis DasDynamique Solutions LLC

Period Amount Period Amount

Jul-14 $1,000 Jan-15 $1,000

Aug-14 $1,000 Feb-15 $1,000

Sep-14 $1,000 Mar-15 $1,000

Oct-14 $1,000 Apr-15 $1,000

Nov-14 $1,000 May-15 $1,000

Dec-14 $1,000 Jun-15 $1,000

Page 11: Multiperiod Accounting in Oracle EBS R12

■ Expected journal entries in Jun-14

■ Expected journal entries Jul-14 to Jun-15

Scenario

Copyright Prithis DasDynamique Solutions LLC

Period Journal Period Amount

Jul-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Jan-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Aug-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Feb-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Sep-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Mar-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Oct-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Apr-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Nov-14 Dr Expense $1,000Cr Prepaid Expenses $1000

May-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Dec-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Jun-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Period Journal Period Journal

Jun-14 Dr Prepaid Expense $12,000Cr AP Liability $12,000

Jun-14 Dr AP Liability $12,000Cr Bank $12,000

Page 12: Multiperiod Accounting in Oracle EBS R12

Multiperiod Accounting SetupsCopyright Prithis DasDynamique Solutions LLC

Page 13: Multiperiod Accounting in Oracle EBS R12

■ Optional Setups – likely to be different for each implementation, based on design▪ Value Set for Prepayment Type

— Create Values for the Value Set

▪ Descriptive Flexfield— Invoice Lines DFF

■ Subledger Accounting Setups – likely to be similar for all implementations▪ Mapping Set

▪ Account Derivation Rule

▪ Journal Line Types

▪ Journal Line Definition

▪ Application Accounting Definition

▪ Subledger Accounting Method

▪ Ledger

Multiperiod Accounting Setups

Copyright Prithis DasDynamique Solutions LLC

Page 14: Multiperiod Accounting in Oracle EBS R12

■ Value Set for Prepayment Type

Multiperiod Accounting Setups

Copyright Prithis DasDynamique Solutions LLC

Page 15: Multiperiod Accounting in Oracle EBS R12

■ Enter Values in Value Set for Prepayment Type■ You can enter values for:

▪ Specific types of Prepayments

▪ Specific Vendors

Multiperiod Accounting Setups

Copyright Prithis DasDynamique Solutions LLC

Page 16: Multiperiod Accounting in Oracle EBS R12

■ Descriptive Flexfield▪ Invoice Lines DFF

Multiperiod Accounting Setups

You do not have to make this DFF context sensitive. You can make this Global.

Copyright Prithis DasDynamique Solutions LLC

Page 17: Multiperiod Accounting in Oracle EBS R12

■ Descriptive Flexfield▪ Invoice Lines DFF

▪ Assign the Value Set created in the earlier step

Multiperiod Accounting Setups

In this demo we have selected ATTRIBUTE15. Typically you would start at ATTRIBUTE1 if available.

Copyright Prithis DasDynamique Solutions LLC

Page 18: Multiperiod Accounting in Oracle EBS R12

■ Descriptive Flexfield▪ Invoice Lines DFF

Multiperiod Accounting Setups

You must uncheck Required checkbox as not all invoices are Prepayments.

Copyright Prithis DasDynamique Solutions LLC

Page 19: Multiperiod Accounting in Oracle EBS R12

Subledger Accounting Setups for MPA

Copyright Prithis DasDynamique Solutions LLC

Page 20: Multiperiod Accounting in Oracle EBS R12

Application Accounting Definition

Subledger Accounting Setups for MPA

Mapping Set

Account Derivation Rule

Journal Line Type

Journal Line Definition

Subledger Accounting Method

Ledger

Copyright Prithis DasDynamique Solutions LLC

Page 21: Multiperiod Accounting in Oracle EBS R12

Subledger Accounting Setups for MPA

Copyright Prithis DasDynamique Solutions LLC

■ Navigation Paths from Payables Manager Responsibility▪ Mapping Set

▪ Account Derivation Rule

▪ Journal Line Type

▪ Journal Line Definition

▪ Application Accounting Definition

▪ Subledger Accounting Method

▪ Ledger

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■ Mapping Set

Subledger Accounting Setups for MPA

Field Data

Mapping Set Code XXPD_MPA_EXP_CCID

Mapping Set Name XXPD MPA ACCRUAL EXPENSE CCID

Mapping Set Description

XXPD Multi-Period Accounting Invoices - Amortization Expense Account

Copyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Link the Mapping Set to the Value Set created earlier

For each Input Value, enter the Output Value: Enter the target Expense account for amortization

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■ Account Derivation Rule

Subledger Accounting Setups for MPA

Field Data

Rule Code XXPD_MPA_EXP_FLEX

Rule Name XXPD MPA Prepaid to Expense Account Flexfield

Description XXPD MPA Prepaid to Expense Account Flexfield

Assign the Mapping Set = XXPD MPA ACCRUAL EXPENSE CCID created earlier.Input Source = Invoice Line Flexfield Segment 15

Will receive a Warning on save

There is no need to assign a Condition

Copyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 24: Multiperiod Accounting in Oracle EBS R12

■ Journal Line Type - Accrual

Subledger Accounting Setups for MPA

Field Data

Line Type Code XXPD_AP_ITEM_EXP_INV_MPA_ACC

Name XXPD Multi Period Accounting and Regular Item Expense Accrual

Description XXPD Multi Period Accounting and Regular Item Expense Accrual, replaces “Item Expense” JLT

For the accrual journal line type, set the Multiperiod option to 'Accrual'

Copyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 25: Multiperiod Accounting in Oracle EBS R12

■ Journal Line Type - Recognition

Subledger Accounting Setups for MPA

Field Data

Line Type Code XXSL_AP_ITEM_EXP_INV_MPA_RECOG

Name XXPD Multi Period Accounting Item Expense Recognition

Description XXPD Multi Period Accounting Item Expense Recognition

For the recognition journal line type, set the Multiperiod option to 'Recognition'.

Copyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 26: Multiperiod Accounting in Oracle EBS R12

■ Journal Line Type – Accrual – Assign Sources

Subledger Accounting Setups for MPA

Assign sources to the following accounting attributes for the accrual journal line type

Multiperiod Start Date

Determines the accounting period and accounting date for the first recognition journal entry

Multiperiod End Date

Determines the accounting period and accounting date for the last recognition journal entry

Multiperiod Option

Determines whether multiperiod or single period accounting to be generated for an accounting event

Copyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 27: Multiperiod Accounting in Oracle EBS R12

■ Journal Line Definition▪ Retrieve and Copy the seeded JLD “Accrual, Invoices All”.

Subledger Accounting Setups for MPA

Field Data

Definition Code XXSL_AP_ITEM_EXP_INV_MPA_RECOG

Definition Name XXPD Accrual, Invoices All

Description XXPD Oracle Payables Accrual Accounting Definition (All)

Copyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 28: Multiperiod Accounting in Oracle EBS R12

■ Journal Line Definition (User owned)▪ Copy the seeded Line Assignment “Item Expense” to a new

Assignment “XXPD Multi Period Accounting and Regular Item Expense Accrual”

Subledger Accounting Setups for MPACopyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 29: Multiperiod Accounting in Oracle EBS R12

■ Journal Line Definition (User owned)▪ Inactivate the seeded line assignment “Item Expense”

▪ Assign new JLT “XXPD Multi Period Accounting and Regular Item Expense Accrual”

Subledger Accounting Setups for MPACopyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

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■ Journal Line Definition (User owned)▪ Assign the seeded Account Derivation Rule “Invoice Distribution

Account” to All Segments

▪ Assign a Line Description (custom JLD in this example)

Subledger Accounting Setups for MPACopyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

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■ Journal Line Definition (User owned)▪ The Multiperiod Accounting button will be enabled for this

Journal Line Type

▪ Click on the Multiperiod Accounting button

Subledger Accounting Setups for MPACopyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

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■ Multiperiod Accounting Assignment▪ Options

— Number of Journal Entries

— GL Dates

— Proration Type

Subledger Accounting Setups for MPACopyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 33: Multiperiod Accounting in Oracle EBS R12

■ Multiperiod Accounting Assignment Options

■ Source: Oracle Subledger Accounting Implementation Guide

Subledger Accounting Setups for MPA

Number of Journal Entries: Number of multiperiod journal entries to be createdOne One multiperiod journal entry is created to

recognize the entire accrual amount.Note: If this option is selected, it is not possible to select a proration type since only one journal entry is created for the entire accrual amount.

One per GL Period

One multiperiod journal entry is created per GL period between the dates defined by the multiperiod start and end date accounting attributes.

Copyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 34: Multiperiod Accounting in Oracle EBS R12

■ Multiperiod Accounting Assignment Options

■ Source: Oracle Subledger Accounting Implementation Guide

Subledger Accounting Setups for MPA

GL Dates: Specifies when the multiperiod journal entries are created inthe GL periodFirst Day GL Period

Multiperiod journal entries have a GL date of the first day of the periodExample: 1-Oct-2014

Last Day GL Period:

Multiperiod journal entries have a GL date of the last day of the period.Example: 31-Oct-2014

Originating Day

Multiperiod entries have the same GL date as the originating journal entry.Example: 22-Oct-2014If Originating Day is 31-Oct, the next multiperiod JE will have a date of 30-Nov.

Copyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 35: Multiperiod Accounting in Oracle EBS R12

■ Multiperiod Accounting Assignment Options▪ See Document 1915795.1 on My Oracle Support for worked out

examples for each Proration Type

■ Source: Oracle Subledger Accounting Implementation Guide

Subledger Accounting Setups for MPA

Proration Type: Specifies how the recognition amount per period should becalculated360 days Partial periods calculated by assuming 360 days in a year

Days in Period Partial periods calculated by dividing the number of partial period days by the actual number of days in the period

First Period Accrual amount divided by the number of periods and recognized evenly starting with the first period

Total Days in Period

Both the partial periods and the whole periods are based on the actual number of days in the period. The number of days within each period is then divided by the total number of days in the whole multi accounting period. The result is then multiplied by the total amount due to arrive at an amount for each respective period.

Copyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 36: Multiperiod Accounting in Oracle EBS R12

■ Multiperiod Accounting Assignment options

Click on the Line Assignments button

Subledger Accounting Setups for MPACopyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 37: Multiperiod Accounting in Oracle EBS R12

■ Line Assignments▪ For the Accrual Journal Line Type

— All Segments will use the seeded ADR “Invoice Distribution Account”

Subledger Accounting Setups for MPACopyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 38: Multiperiod Accounting in Oracle EBS R12

■ Line Assignments▪ For the Recognition Journal Line Type

— All Segments will use the custom ADR “XXPD MPA Prepaid to Expense Account Flexfield”

Subledger Accounting Setups for MPACopyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 39: Multiperiod Accounting in Oracle EBS R12

■ Application Accounting Definition▪ Copy the seeded AAD “Accrual Basis” to a custom AAD “XXPD

Accrual Basis”

▪ Replace the seeded JLD Assignment XXPD Accrual, Invoices All to the custom JLD “XXPD Accrual, Invoices All”

Subledger Accounting Setups for MPACopyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Validate the Application Accounting Definition

Page 40: Multiperiod Accounting in Oracle EBS R12

■ Subledger Accounting Methods▪ Copy the seeded SLAM “Standard Accrual” to a custom SLAM

“XXPD Standard Accrual”

▪ Replace the seeded AAD Assignment Accrual Basis to the custom AAD Assignment “XXPD Accrual Basis”

Subledger Accounting Setups for MPACopyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 41: Multiperiod Accounting in Oracle EBS R12

■ Subledger Accounting Methods▪ Replace the SLAM “Standard Accrual” with the custom SLAM

“XXPD Standard Accrual” in your Primary Ledger

Subledger Accounting Setups for MPACopyright Prithis DasDynamique Solutions LLC

Mapping Set ADR JLT JLD AAD SLAM Ledger

Page 42: Multiperiod Accounting in Oracle EBS R12

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

Page 43: Multiperiod Accounting in Oracle EBS R12

■ Enter a Standard Invoice for Prepaid Software Maintenance▪ Invoice Type is Standard and not Prepayment

▪ Say Invoice Date is 15th June, it was entered on 25th June

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

Page 44: Multiperiod Accounting in Oracle EBS R12

■ At the Line level▪ Enter a Prepayment Distribution account

▪ Check the Deferred Option checkbox

▪ Enter the Deferred Start Date and Deferred End Date fields

▪ Enter the Prepayment Type (select from LOV) in the DFF

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

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■ Create Accounting▪ Validate the Invoice, then run Create Accounting

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

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■ Create Accounting will spawn:▪ Accounting Program

▪ Journal Import

▪ Subledger Accounting Balances Update

▪ Subledger Multiperiod Accounting and Accrual Reversal Report

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

Page 47: Multiperiod Accounting in Oracle EBS R12

■ If Create Accounting and Account Program completes with a yellow Warning or red Error, STOP!▪ Review the report to identify and troubleshoot the problem

▪ Common causes for Create Accounting to Fail:— The Application Accounting Definition was not validated (in this case

the Create Accounting program completes in a red error)

— The DFF at the Line level was not used. In this example the Prepayment Type drives the Recognition accounting. So in the absence of this information on the DFF the Accounting will fail

— The General Ledger period was not open

— Cross-validation or Security Rules were violated

— Account Combination was disabled

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

Page 48: Multiperiod Accounting in Oracle EBS R12

■ Create Accounting▪ Will generate the Subledger Accounting Program Report

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

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■ Subledger Multiperiod Accounting and Accrual Reversal Report

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

Page 50: Multiperiod Accounting in Oracle EBS R12

■ Subledger Multiperiod Accounting and Accrual Reversal Report

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

Page 51: Multiperiod Accounting in Oracle EBS R12

■ Subledger Multiperiod Accounting and Accrual Reversal Report

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

Page 52: Multiperiod Accounting in Oracle EBS R12

■ Subledger Multiperiod Accounting and Accrual Reversal Report

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

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■ GL Journal Entry

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

Page 54: Multiperiod Accounting in Oracle EBS R12

■ Expected journal entries in Jun-14

■ Expected journal entries Jul-14 to Jun-15

Transaction Processing for MPA

Copyright Prithis DasDynamique Solutions LLC

Period Journal Period Amount

Jul-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Jan-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Aug-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Feb-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Sep-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Mar-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Oct-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Apr-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Nov-14 Dr Expense $1,000Cr Prepaid Expenses $1000

May-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Dec-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Jun-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Period Journal Period Journal

Jun-14 Dr Prepaid Expense $12,000Cr AP Liability $12,000

Jun-14 Dr AP Liability $12,000Cr Bank $12,000

Page 55: Multiperiod Accounting in Oracle EBS R12

■ “Complete Multiperiod Accounting” concurrent program▪ Run in subsequent months from Jul-14 to Jun-15

▪ Schedule this program to run automatically

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

Page 56: Multiperiod Accounting in Oracle EBS R12

■ Complete Multiperiod Accounting concurrent program▪ Creates journal entries for Expense Recognition for the period it

is run

▪ Provides a report for the Multiperiod Journal Entries for that period

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

Page 57: Multiperiod Accounting in Oracle EBS R12

■ Complete Multiperiod Accounting concurrent program

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

Page 58: Multiperiod Accounting in Oracle EBS R12

■ Complete Multiperiod Accounting concurrent program

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

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■ GL Journal Entry in each subsequent period through Jun-15

Transaction Processing for MPACopyright Prithis DasDynamique Solutions LLC

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■ Expected journal entries in Jun-14

■ Expected journal entries Jul-14 to Jun-15

Transaction Processing for MPA

Copyright Prithis DasDynamique Solutions LLC

Period Journal Period Amount

Jul-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Jan-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Aug-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Feb-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Sep-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Mar-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Oct-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Apr-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Nov-14 Dr Expense $1,000Cr Prepaid Expenses $1000

May-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Dec-14 Dr Expense $1,000Cr Prepaid Expenses $1000

Jun-15 Dr Expense $1,000Cr Prepaid Expenses $1000

Period Journal Period Journal

Jun-14 Dr Prepaid Expense $12,000Cr AP Liability $12,000

Jun-14 Dr AP Liability $12,000Cr Bank $12,000

Page 61: Multiperiod Accounting in Oracle EBS R12

Implementation ConsiderationsCopyright Prithis DasDynamique Solutions LLC

Page 62: Multiperiod Accounting in Oracle EBS R12

■ Enhancement possibilities▪ Use a DFF for Prepayment Type and a Mapping Set to drive the

expense account (as shown in this example)

▪ Alternately, use the Prepayment Account on the invoice to drive the Expense account using a Mapping Set

■ Invoice having regular expense or Asset purchase in addition to Prepayment expense▪ Use Deferred option fields only for those lines which are

prepayment in nature

■ What if Prepaid Invoice is already paid outside Oracle▪ Can enter Invoice in Oracle and set Deferred start and end

dates. System will take care of the rest and account correctly

Implementation Considerations

Copyright Prithis DasDynamique Solutions LLC

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■ Existing open Prepayments when MPA is implemented▪ There is no way to “convert” Prepayment invoices to Standard

invoices using MPA. Process Prepayment invoices as usual till they are closed.

■ If the journal effective date of a journal imported from the Subledger defaults to the last date of the period, you will have to adjust the “summarization” Subledger Accounting Options for the Ledger

■ Critical patches released for Multiperiod Accounting in SLA▪ 7109881, 8505463, 8635648, 8664504, 9954676, 9162117,

10394715, 11654120, 13023651 and 13415216.

▪ Patch 13018752:R12.XLA.B is recommended for Proration Type “First Period” amounts fix

Implementation Considerations

Copyright Prithis DasDynamique Solutions LLC

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■ Do we need two accrual journal line types to achieve single period accounting and multiperiod accounting?▪ No, two separate accrual journal line types are not required.

▪ With the same accrual journal line type, single period and multiperiod accounting can be created.

▪ Whether multiperiod or single period accounting is to be created for a transaction is determined based on the value passed for the Multiperiod Option accounting attribute.

▪ If the value passed is 'Y' then multiperiod accounting is created. If the value passed is 'N' or null then single period accounting is created.

■ No changes in MPA functionality from 12.1.3 to 12.2 as of today

Implementation Considerations

Copyright Prithis DasDynamique Solutions LLC

Page 65: Multiperiod Accounting in Oracle EBS R12

ReferencesCopyright Prithis DasDynamique Solutions LLC

Page 66: Multiperiod Accounting in Oracle EBS R12

References

■ Oracle Subledger Accounting Implementation Guide (E13628-04)

■ Document 1399611.1 on My Oracle Support▪ Out-dated information (12.1.2), but useful for basic setups

■ Document 1915795.1 for 12.1.3 on My Oracle Support▪ Most current document (Aug-2014)

▪ Gives explanation of Proration Type options with examples

Copyright Prithis DasDynamique Solutions LLC

Page 67: Multiperiod Accounting in Oracle EBS R12

Q & A

[email protected]

Cell630.3649457

WebsiteDynamiquesolutionsllc.com

Additional questions?