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RELEASE CONTENT DOCUMENT

Release 12

Financial Applications

Prepared by Financials Product Management Team

Last Updated: 27th February 2006

Version: 25

Company Confidential - For Oracle Internal Use Only

Copyright 2006, Oracle. All rights reserved.


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Confidential - For internal use only

Table of Contents

1. Disclaimer 1

2. Introduction 2

2.1. Purpose of Document 2

3. Release 12 Objectives 3

4. Oracle Financials Applications Architectural and Closely-related Enhancements 6

4.1. Multi-Org Access 6

4.1.1. Overview 64.1.2. Features 6

4.1.2.1. Multi-Org Access Control 64.1.2.2. Multi-Org Security Profile Preferences 64.1.2.3. Enhanced Multi-Org Reporting 74.1.2.4. Multi-Org Integration with Accounting Setup Manager 7

4.2. Oracle Cash Management 84.2.1. Overview 84.2.2. Features 8

4.2.2.1. Bank Account Model 84.2.2.2. Multi-Org Access Control 84.2.2.3. Subledger Accounting 8

4.2.2.4. Bank Account Balances and Interest Calculation 94.2.2.5. Bank Account Transfers 94.2.2.6. Cash Pooling 94.2.2.7. Bank Statement Accounting 104.2.2.8. Bank Account Signing Authorities 114.2.2.9. Cash Positioning Intra-day Activities 11

4.3. Oracle General Ledger 124.3.1. Overview 124.3.2. Features 12

4.3.2.1. Accounting Setup 124.3.2.2. Improved Processing Efficiency 134.3.2.3. Data Security 144.3.2.4. Auditability 154.3.2.5. Others 16

4.3.3. Terminology 17

4.4. Oracle Subledger Accounting New Product 194.4.1. Overview 194.4.2. Features 19

4.4.2.1. Journal Entry Setups 194.4.2.2. Date Effective Application Accounting Definitions 204.4.2.3. Multiple Accounting Representations 204.4.2.4. Online Accounting 214.4.2.5. Replacement for Disabled Accounts 21


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4.4.2.6. Process Category Accounting 214.4.2.7. Straight Through Accounting Processing 214.4.2.8. On-line inquiries 224.4.2.9. Journal Entry Sequencing 224.4.2.10. Third Party Merge Accounting 224.4.2.11. Manual Journal Entries 234.4.2.12. Third Party Control Accounts 234.4.2.13. Transaction Account Builder 234.4.2.14. Multi-period Accounting 23

4.4.2.15. Accrual Reversal Accounting 234.4.2.16. Business Flows 244.4.2.17. Accounted and Gain/Loss Amount Calculations 244.4.2.18. Application Accounting Definitions Loader 244.4.2.19. Errors Accounting and Reporting 244.4.2.20. Standard Reports 254.4.2.21. Enhanced Reporting Currency Functionality 254.4.2.22. Diagnostics Framework 25

4.4.3. Oracle Subledger Accounting Enhances the Functionality of the Global Accounting Engine 254.4.4. Terminology 27

4.5. Oracle Legal Entity Configurator 294.5.1. Overview 294.5.2. Features 29

4.5.2.1. Oracle Legal Entity Configurator 294.5.2.2. Legal Authorities and Jurisdiction 304.5.2.3. Legal Date Tracking and Auditing 30


4.6. Oracle Advanced Global Intercompany System 324.6.1. Overview 324.6.2. Features 32

4.6.2.1. Intercompany Balancing 324.6.2.2. Intercompany Invoicing 324.6.2.3. Intercompany Reconciliation 334.6.2.4. Manual Intercompany Transactions 33


4.7. Oracle E-Business Tax New Product 344.7.1. Overview 344.7.2. Features 34

4.7.2.1. Configuration Options and Provider Service Subscriptions 344.7.2.2. Events and Configuration Owner Options 354.7.2.3. Tax Configuration Manager 354.7.2.4. Tax Determination Services 354.7.2.5. Centralized Tax Record Repository for Audit and Reporting 364.7.2.6. Tax Reporting 364.7.2.7. Tax Simulator 364.7.2.8. Guided Configuration 374.7.2.9. Additional Enhancements 37


5. Oracle Financial Applications - Features and Enhancements 40

5.1. Oracle Advanced Collections 405.1.1. Overview 405.1.2. Features 40

5.1.2.1. Multi-Org Access Control 405.1.2.2. Uptake of Cross-Operating Unit Initiative 405.1.2.3. Consolidation of Collections Functionality into Advanced Collections 405.1.2.4. New Implementation Checklist and Setup Screens 415.1.2.5. Improved Payment Processing and Customer Funds Capture 41


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5.1.2.6. Use of Oracle Territory Management to Define Collections Territory Hierarchy 415.1.2.7. AR Collector Field and Extension to Territory Management 415.1.2.8. XML Publishing Technology for Collections Correspondence 425.1.2.9. Configurable Metrics 425.1.2.10. Aging-based Dunning Plans 425.1.2.11. Collections Best Practices 435.1.2.12. Filterable Bali Tables 435.1.2.13. Consolidated Collections with Lease Contracts or Loans 445.1.2.14. Search Tool Enhancements 44

5.1.2.15. Enhanced Scoring Capability 445.1.2.16. Automatic Strategy Changing 44

5.2. Oracle Assets 465.2.1. Overview 465.2.2. Features 46

5.2.2.1. Subledger Accounting 465.2.2.2. Enhanced Mass Additions Interface for Legacy Conversions 465.2.2.3. Automatic Preparation of Mass Additions 465.2.2.4. Enhanced functionality for Energy Industry 475.2.2.5. Flexible Reporting using XML Publisher 475.2.2.6. Automatic Depreciation Rollback 475.2.2.7. Enhanced Logging for Asset Transactions and Programs 48

5.3. Oracle Bill Presentment Architecture 495.3.1. Overview 495.3.2. Features 49

5.3.2.1. Balance Forward Bill Presentment 495.3.2.2. Enhanced Template Assignment 495.3.2.3. Attachment Printing 495.3.2.4. BPA Profile Option Access 495.3.2.5. Legal Entity 505.3.2.6. Multi-Org Access Control 50

5.4. Oracle Credit Management 515.4.1. Overview 515.4.2. Features 51

5.4.2.1. Common Components for Leasing and Loan Applications 515.4.2.2. Enhancements to User-Defined Data in Credit Case Folders 515.4.2.3. Multi-Period Financial Data Comparison 515.4.2.4. Credit Scoring Model Enhancements 525.4.2.5. Credit Recommendation Enhancements 525.4.2.6. Credit Decision Appeals Processing 525.4.2.7. Dynamic Credit Analyst Assignments 525.4.2.8. Automatic Assessments of Guarantors 52

5.5. Oracle Enterprise Performance Foundation 545.5.1. Overview 545.5.2. Features 54

5.5.2.1. Oracle Release 12 Schema 545.5.2.2. Enhanced Oracle General Ledger Integration 54

5.5.2.3. Shared, Reformatted Ledger Data 545.5.2.4. Oracle Workflow Integration 555.5.2.5. Integration with Concurrent Manager 555.5.2.6. Oracle Warehouse Builder Replaces Balance & Control 555.5.2.7. New User Interfaces 555.5.2.8. Security and System Administration 555.5.2.9. User Defined Signage Methodologies 565.5.2.10. Configurable Home Page 575.5.2.11. Tuning Options Administration User Interface 575.5.2.12. Rule Migration, Import and Export 575.5.2.13. Multi-Dimensional Data Model 57


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5.5.2.14. Dimension Member Attributes 585.5.2.15. Data Set Registration and Creation 585.5.2.16. Dataset Groups 595.5.2.17. Business Rule Definition and Management 595.5.2.18. Conditions 615.5.2.19. Data Inspector 615.5.2.20. Auditing and Data Integrity 615.5.2.21. Production Datasets 615.5.2.22. Process Locking 62

5.5.2.23. Rule Auditing 625.5.2.24. Effective Dating & Versioning 625.5.2.25. Seeded Reports 62


5.6. Oracle Enterprise Planning and Budgeting 675.6.1. Overview 675.6.2. Features 67

5.6.2.1. Usability Enhancements 675.6.2.2. Scalability Enhancements 67

5.7. Oracle Financial Consolidation Hub New Product 695.7.1. Overview 695.7.2. Features 69

5.7.2.1. Enterprise View 695.7.2.2. Unity of Statutory and Management Results 695.7.2.3. Consolidation Versatility 695.7.2.4. Entire Consolidation Cycle Monitored 705.7.2.5. Automated Workflow and Exception Handling 705.7.2.6. Dynamic Ownership Structures 705.7.2.7. Analytical Reporting Capabilities 705.7.2.8. Audit Entries from Every Stage of Consolidation 705.7.2.9. Accessibility of Complete Consolidation History 705.7.2.10. Best Practices Automated 705.7.2.11. Complex Calculations and Eliminations Handled 715.7.2.12. Global Consolidation Requirements Managed 715.7.2.13. Internal Controls Manager Integration 71

5.7.2.14. Excel Add-in and Oracle General Ledger Drilldown 715.7.2.15. Concurrent Programs for Reporting 725.7.2.16. Line Item Intercompany Maps 72


5.8. Oracle Financials for Asia Pacific 735.8.1. Overview 735.8.2. Features 73

5.8.2.1. Korean Withholding Tax 735.8.2.2. Taiwan Transaction Numbering 735.8.2.3. Asia Pacific Reports 735.8.2.4. Multi-Org Access Control 735.8.2.5. Legal Entity Architecture 73

5.9. Oracle Financials for EMEA 755.9.1. Overview 755.9.2. Features 75

5.9.2.1. EMEA VAT Reporting 755.9.2.2. EMEA Country Specific Reports 75

5.10. Oracle Financials for India 765.10.1. Overview 765.10.2. Features 76

5.10.2.1. CENVAT Rules 2004 Changes 765.10.2.2. Tax Deducted at Source (TDS) Thresholds 77


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5.10.2.3. Value Added Tax (VAT) 775.10.2.4. DFF Elimination 785.10.2.5. Multi-Org Access Control 785.10.2.6. AP Invoice Lines 785.10.2.7. Subledger Accounting 785.10.2.8. OPM Inventory Convergence 79


5.11. Oracle Financials for Latin America 805.11.1. Overview 805.11.2. Features 80

5.11.2.1. General Ledger Inflation Adjustments 805.11.2.2. Receivables Latin Tax Engine 805.11.2.3. Latin America Extended Withholding 805.11.2.4. Brazil Receivables Bank Transfer 805.11.2.5. Latin America Reports 815.11.2.6. Multi-Org Access Control 815.11.2.7. Legal Entity Configurator 81

5.12. Oracle Financial Services Accounting Hub (FSAH) New Product 825.12.1. Overview 825.12.2. Features 825.12.3. Oracle Enterprise Performance Foundation 83

5.12.4. Oracle Profitability Manager 835.13. Oracle Internal Controls Manager 84


5.13.2.1. External Auditor Ready Reporting 845.13.2.2. Export Search Results to Excel 845.13.2.3. DBI for Compliance 845.13.2.4. Segregation Of Duties: Concurrent programs in Constraint Definition 855.13.2.5. Segregation Of Duties: Constraints with incompatible sets 855.13.2.6. Segregation Of Duties: Re-validating constraints after corrective actions 865.13.2.7. Segregation Of Duties: Complaint Provisioning of User Accounts 865.13.2.8. Upload Recommended Settings 865.13.2.9. Application Controls Change History Reports 865.13.2.10. Application Control Overrides in Suppliers and Supplier Sites 865.13.2.11. Profile Option Change Tracking 86

5.14. Oracle Internet Expenses 875.14.1. Overview 875.14.2. Features 87

5.14.2.1. Expense Allocations 875.14.2.2. Global Per Diem and Mileage 885.14.2.3. Cash Advances Management 895.14.2.4. Bar Coding 895.14.2.5. Manager Approvals 895.14.2.6. Audit Management 905.14.2.7. Audit Automation 91

5.14.2.8. Receipts Management 915.14.2.9. Entertainment and Fringe Benefits Policy Compliance 915.14.2.10. Credit Cards 925.14.2.11. Expense Report-Level Descriptive Flexfields 925.14.2.12. Attachments 935.14.2.13. Expense Analysis and Reporting 935.14.2.14. Ad Hoc Reporting 935.14.2.15. Terms and Agreements 935.14.2.16. Region-Based Confirmation Page Messages 935.14.2.17. Help Desk Support 945.14.2.18. Contact Us 94


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5.15. Oracle iReceivables 955.15.1. Overview 955.15.2. Features 95

5.15.2.1. Oracle Trading Community Architecture 955.15.2.2. Oracle Payments 955.15.2.3. Multi-Org Access Control 955.15.2.4. Enhanced User Self Registration 965.15.2.5. Cross Customer Site Payments 96

5.16. Oracle Loans 975.16.1. Overview 975.16.2. Features 97

5.16.2.1. Loan Type and Product Configuration 975.16.2.2. Multiple Disbursements 975.16.2.3. Loan Portfolios, Graphs & Online Reporting 975.16.2.4. Sophisticated Credit Decisioning 985.16.2.5. Federal Budgetary Control 985.16.2.6. Floating Rate and Weekly Payment Frequency 985.16.2.7. Enhanced Payment Plans with Rules 98

5.17. Oracle Payables 995.17.1. Overview 995.17.2. Features 99

5.17.2.1. Legal Entity 995.17.2.2. Multi-Org Access Control 995.17.2.3. Representation of Suppliers in the Trading Community Architecture (TCA) 995.17.2.4. New User Interface for Supplier Entry and Maintenance 1005.17.2.5. Introduction of Invoice Lines 1005.17.2.6. Invoice Processing for Contract Financing, Retainage, and Progress Terms 1015.17.2.7. Enhanced Invoice Approval Includes Line Level Approval 1025.17.2.8. Non PO Invoices Entered via iSupplier Portal 1025.17.2.9. Collaboration with Suppliers to Resolve Disputes 1025.17.2.10. Oracle E-Business Disbursement Requests 1025.17.2.11. Enhancements to Payment Banks, Branches, and Accounts 1025.17.2.12. Payment Process Enhancements 1035.17.2.13. Accounts Receivable / Accounts Payable Netting 103

5.18. Oracle Payments 1045.18.1. Features 104

5.18.1.1. Advanced and Highly Configurable Formatting Framework 1045.18.1.2. Flexible Validation Model 1055.18.1.3. Secure Payment Data Repository 1055.18.1.4. Improved Electronic Transmission Capability 1065.18.1.5. Flexible Support for Various Business Payment Models 106

5.18.2. Funds Disbursement Features 1065.18.2.1. Enhanced Disbursement Process 1065.18.2.2. Enhanced Electronic Payment Processing 1075.18.2.3. Configurability 1075.18.2.4. Payment Processing User Interface 1085.18.2.5. Enhanced Check Printing Process 1085.18.2.6. Migration of Global Features to Central Engine 1085.18.2.7. Consolidation of Payment Formats 1095.18.2.8. Improved Remittance Advice Reporting 109

5.18.3. Funds Capture Features 1095.18.3.1. Enhanced Configurability 1095.18.3.2. Improved Support for Credit Card Security Features 1105.18.3.3. Enhanced Payment Processing User Interface 1105.18.3.4. PINless Debit Card Transaction Support 1105.18.3.5. Improved Payer Notification of Settlement 1115.18.3.6. Direct Debit Enhancements 111


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5.18.3.7. Improved Batch Settlement Performance 1115.18.4. Terminology 111

5.19. Oracle Profitability Manager New Product 1135.19.1. Product Overview and Foundation 1135.19.2. Release Overview 1135.19.3. Features 114

5.19.3.1. Powerful Allocation System 1145.19.3.2. Rule Sets 1155.19.3.3. Transaction Costing 1155.19.3.4. Multi-Dimensional Activities and Cost Objects 1155.19.3.5. Activity Rates 1155.19.3.6. Activity Cost Rollup 1155.19.3.7. Mapping to Cost Objects 1165.19.3.8. Bill and Cost Object Unit Cost 1165.19.3.9. Cost Object Extended Costs and Cost Object Total Costs 1165.19.3.10. Customer Profitability 1175.19.3.11. Seeded Reports 117

5.19.4. Features Not Included 1175.19.4.1. Common Features 1175.19.4.2. Oracle Profitability Manager Features 118

5.20. Oracle Public Sector Budgeting 119

5.20.1. Overview 1195.20.2. Features 1195.20.2.1. Enhanced Position Default Rules 1195.20.2.2. Configurable Position Worksheet Function Security 1195.20.2.3. Posting Statistical Balance 120

5.21. Oracle Public Sector Financials 1215.21.1. Overview 1215.21.2. Features 121

5.21.2.1. Centralized and Configurable Accounting 1215.21.2.2. Integrated Budgetary Control 1215.21.2.3. Flexible Reporting and Inquiry 121

5.22. Oracle Receivables 122


5.22.2.1. Revenue Management Enhancements 1225.22.2.2. Line Level Cash Applications 1235.22.2.3. Funds Capture Enhancements Uptake 1235.22.2.4. Refunds Enhancements 1235.22.2.5. Credit Card Error Handling 1235.22.2.6. Credit Card Chargebacks 1235.22.2.7. Deduction Management 1235.22.2.8. Balance Forward Billing 1245.22.2.9. Late Charges 1245.22.2.10. Customer Standard User Interface Redesign 1245.22.2.11. Multi-Org Access Control 124

5.22.2.12. E-Business Tax 1255.22.2.13. Legal Entities 1255.22.2.14. Subledger Accounting 1255.22.2.15. Receivables Reconciliation Enhancements 1255.22.2.16. Additional Bills Receivable Reference Field 1265.22.2.17. Collections Workbench Obsolescence 1265.22.2.18. Bills of Exchange Obsolescence 1265.22.2.19. Trade Accounting Obsolescence 1265.22.2.20. AP/AR Netting 126

5.23. Oracle Transfer Pricing 127


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5.23.1. Overview 1275.23.1.1. Enhanced Multi-Currency Support 1275.23.1.2. Single Assumption/Processing Dimension (Product Leaf) 1275.23.1.3. Node Level Assumptions 1285.23.1.4. Conditional Assumptions 1285.23.1.5. Enhanced Ledger Migration Dimensionality 1285.23.1.6. Cash Flow Edits Administration 1285.23.1.7. Interest Rate Administration 1295.23.1.8. Seeded Reports 129

5.24. Oracle Treasury 1305.24.1. Overview 1305.24.2. Features 130

5.24.2.1. Cash Pooling Across Legal Entities 1305.24.2.2. Foreign Exchange Hedge Effectiveness and Accounting Under IAS 39 and FAS 133 1305.24.2.3. Automatic Bond Rate Resetting 1315.24.2.4. Bank Account Update Program 1315.24.2.5. Inter-Account Transfer Enhancements 1315.24.2.6. Bank Account Model 1315.24.2.7. Bank Account Balances 131


5.25. Oracle U.S. Federal Financials 133

5.25.1. Overview 1335.25.2. Features 1335.25.2.1. Centralized and Configurable Accounting 1335.25.2.2. Integrated Budgetary Control 1335.25.2.3. Flexible Reporting and Inquiry 133

6. Daily Business Intelligence 134

6.1. Daily Business Intelligence (DBI) for Compliance 1346.1.1. Overview 1346.1.2. Features 134

6.1.2.1. Financial Statement Certification Dashboard 1346.1.2.2. Open Remedial Action Summary 1356.1.2.3. Significant Account Evaluation Result 135

6.1.2.4. Significant Account Evaluation Summary 1356.1.2.5. Organization Certification Result 1366.1.2.6. Organization Certification Summary 1366.1.2.7. Process Certification Result 1366.1.2.8. Process Certification Summary 1366.1.2.9. List Reports 1366.1.2.10. Compliance Environment Change 1366.1.2.11. View Significant Account Details 1376.1.2.12. Manage Closing Performance Findings and Remediation 1376.1.2.13. Drill and Pivot the Report Layout 137

6.2. Daily Business Intelligence for Financials 1386.2.1. Overview 1386.2.2.

Features 138

6.2.2.1. Expense Analysis dashboard 1386.2.2.2. DBI for Public Sector Financials 1396.2.2.3. DBI for Payables 1396.2.2.4. Budget/Forecast Import from General Ledger 1406.2.2.5. Role Based Security for Profit & Loss and Expense Management Dashboards 1406.2.2.6. User Defined Dimension 1406.2.2.7. DBI for Financials Back-End Enhancements 140

6.3. Financials Intelligence 1426.3.1. Overview 142


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7. Customer Data Management 143

7.1. Customer Data Hub 1437.1.1. Overview 1437.1.2. Features 143

7.1.2.1. Tax Geography Hierarchy Setup UIs 1437.1.2.2. Multi-Org Access Control (MOAC) 1437.1.2.3. Tax and Geography Validation 1437.1.2.4. Data Quality Management Enhancements 1447.1.2.5. Customer Data Librarian Enhancements 1447.1.2.6. Integration Services 1447.1.2.7. TCA Bulk Import Enhancements 1467.1.2.8. New Workflow Synchronization 146

7.2. Customer Data Librarian 1477.2.1. Overview 1477.2.2. Features 147

7.2.2.1. Multi-Org Access Control (MOAC) 147

7.3. Customers Online 1487.3.1. Overview 1487.3.2. Features 148

7.3.2.1. Multi-Org Access Control (MOAC) 148


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1. Disclaimer

This Release Content Document (RCD) describes product features that are

proposed for the specified release of the Oracle E-Business Suite. This document

describes new or changed functionality only. Existing functionality from prior

releases is not described. It is intended solely to help you assess the businessbenefits of upgrading to Release 12.

This document in any form, software or printed matter, contains proprietary

information that is the exclusive property of Oracle. Your access to and use of

this confidential material is subject to the terms and conditions of your Oracle

Software License and Service Agreement, which has been executed and with

which you agree to comply. This document and information contained herein

may not be disclosed, copied, reproduced or distributed to anyone outside Oracle

without prior written consent of Oracle. This document is not part of your

license agreement nor can it be incorporated into any contractual agreement with

Oracle or its subsidiaries or affiliates.

This document is for informational purposes only and is intended solely to assist

you in planning for the implementation and upgrade of the product features

described. 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 in this

document remains at the sole discretion of Oracle.

Due to the nature of the product architecture, it may not be possible to safely

include all features described in this document without risking significant

destabilization of the code.


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2. Introduction

2.1. Purpose of Document

The Release Content Document (RCD), produced as part of OraclesApplications Product Lifecycle (APL), communicates information about new or

changed functionality in the specified release of the Oracle E-Business Suite.

Existing functionality from prior point releases is not described. However,

content introduced by Family Packs, Mini-packs or Standalone patches since the

prior point release has been included in this document and denoted accordingly.

New features available with Oracle Financials Family Pack G or with any

product level Mini-packs that have been released since the release of Oracle E-

Business Suite 11i10 are included in this document and are denoted accordingly.


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3. Release 12 Objectives

Release 12 is designed to increase the ease with which you understand and

process your worldwide business and address compliance in every nation. It

reflects the maturity of several initiatives designed to rationalize subledger

bookkeeping, generalize transaction tax compliance and improve access tosubledger data, with the intention of both facilitating subledger shared services

and improving and standardizing throughput. Also in support of shared service

ideals, weve revised our bank and disbursement models.

Weve distinguished the data from the management of general ledgers, improved

legal entity support and intercompany processing, and built a new row and

column consolidation system, rich in financial management functions. These

features are designed to expedite your regional and group control, lower your

finance expenses, and speed decision making by centralizing the processing of

dispersed data. Daily Business Intelligence is greatly expanded, and XML

Publisher brings powerful report customization to the end-users desktop. Your

decision-making requirements also drove radical improvements to our budgeting,profit management and activity analytics, which along with the new Financial

Consolidation Hub are applications built on the shared Enterprise Performance

Foundation.

In addition to these initiatives, weve included many more enhancements and

new features to the E-Business Suite.

In Release 11i, a user assigned to an Operating Unit (OU) would process data

from the products deployed in that OU. To process data for another OU, a user

would log out of the first and into the second. The data generated in that OU

would be accounted for according to rules generated by various product

accounting engines, and posted to general ledger in ways appropriate for thedifferent products, some generating part of the detail at different times in the

process. General Ledger sets of books (SoB) were self-contained, reflecting the

balances of the entity to which youd assigned the SoB, and managed by users

assigned to the SoB.

In Release 12, by contrast, users can be assigned to multiple operating units, and

are supported by processes and transactions that can span operating units. Their

data is book-kept according to rules stored in a single accounting engine, and the

accounting is stored in subledger tables that are standard across all products.

Complete accounting is maintained for every appropriate event, and all subledger

entries are fully balanced and detailed. A single, common posting engine

summarizes to your required level of detail, and posts to General Ledger. Sets ofBooks are replaced by the accounting entitys ledger for data, and its Ledger

Set for processing, from reporting, opening and closing, through allocations.

Ledgers can be combined into ledger sets, and GL users are assigned to the

ledger sets.

User access to multiple operating units is called Multi-Org Access Control,

(MOAC). The new subledger accounting architecture is described in the

Subledger Accounting (SLA) section. Ledgers, ledger sets and multiple ledgers

are described in the General Ledger section.


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Financial Management

Information Architecture Release 12Ledgers and Ledger Sets

Lower Cost, Better Data

Ledgers and Ledger Sets

Lower Cost, Better DataCentralized Accounting

Rules and Entries

Centralized Accounting

Rules and Entries

Data Segmentation AND

Processing Efficiencies

Fewer Responsibilities

Ledger and LedgerLedger and LedgerSetsSets

FeederSystemsFeederFeeder

SystemsSystems

Subledger

AccountingSubledgerSubledger

AccountingAccounting

DrDr CrCr

AssetsAssetsAssets

ProjectsProjectsProjects

Work inProcessWork inWork inProcessProcess

ReceivablesReceivablesReceivablesInventoryInventoryInventory

PayablesPayablesPayablesPurchasingPurchasingPurchasing Operating Units withOperating Units withMOACMOAC

1 Responsibility1 Responsibility

1 Responsibility1 Responsibility

Enterprise PerformanceFoundation

Enterprise PerformanceFoundation

Planning &

BudgetingPlanning &Planning &

BudgetingBudgeting

ConsolidationConsolidationConsolidation

ScorecardScorecardScorecard

Profitability

AnalysisProfitabilityProfitability

AnalysisAnalysis

Were sure you will derive many benefits from the new architecture. The SLA

approach to subledger accounting brings an immediate improvement in subledger

to general ledger reconciliation, for example, before you take any steps to exploit

the features.

Accounting for subledger transactions at the event in a standard manner with a

single accounting engine allows us to provide multiple accounting

representations for a single event. A purchase can be simultaneously accountedfor an increment to inventory for your US GAAP or IAS/IFRS accounting, and

as a debit to the P&L for your national compliance accounting. The accounting

entity involved can maintain multiple ledgers, each complying with a different

set of accounting principles we call them accounting methods, and, of course,

the transactions and ledgers can be valued and denominated in different

currencies; indeed, you can now generate currency views of a ledger at the

subledger transaction, general ledger transaction, general ledger balance, or

consolidation workplace levels, whether you use IAS 21 or FAS 52 Translation

or Remeasurement conversion methods.

Combining ledgers into sets will be attractive not only in nations where you

might have many ledgers serving regulated registered companies, but also acrosscontinental regions where locally managed statutory ledgers are echoed

automatically by centrally managed single currency corporate ledgers at the

parents management style or GAAP, whether that be IAS/IFRS, Japan, China, or

US GAAP.

Our new transaction tax engine is nexus driven; that is, it looks to the appropriate

transaction data to figure the authority and taxes involved. This allows a shared

service center to more easily process VAT and sales taxes accurately for its

clients, no matter what country they might be in. Equally, the new bank account


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and disbursement models facilitate the payment of invoices and other payables

out of different operating units, from an appropriate bank account, and with the

appropriate intercompany handling.

Intercompany processing is dramatically revised by enhancements in both

Financials intercompany management and Supply Chain Managements

Enhanced Drop Shipments. Rather than a GL only system, Financials now links

into Receivables and Payables to generate matching and tied documents(configurable though Bill Presentment) and a new reconciliation scheme.

Related SCM products, discussed in the SCM RCD, provide transfer pricing

modeling and enforcement, inventory consignment (at subsidiaries or otherwise),

and tracking of profit in inventory. All feed back to General ledger and the

Financial Consolidation Hub for elimination.

Underlying many of the improvements in transaction tax, intercompany, and

shared service capabilities is a reinforced legal entity model, more closely

aligned, we hope, with your actual legal structure.

Weve striven to keep your upgrade path straightforward. After upgrading to

Release 12, your installation should behave as it did on Release 11i. What wasin a Set of Books will be in a Ledger with its own Ledger Set. SLA will return

the same accounting as the earlier accounting engine did. Operating Units will

still stripe your transaction data. Youll see immediate benefits in subledger

accounting, XML publishing applied to reports, additional DBI portlets and

pages, and many other features like AR-AP netting, gross margin analytics in

AR, and so on.

You can then exploit the new features at your own pace. Start by assigning

several OUs to individual users, or by combining several ledgers into one ledger

set. Later explore revising accounting rules with the SLA engine, or tackling a

complex tax situation with the tax engine. Pretty soon, youll be thinking of

simplifying the processes, eliminating Sarbanes-Oxley or Eight Directive

problem areas, and shifting into top gear.


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4. Oracle Financials Applications Architectural and

Closely-related Enhancements

4.1. Multi-Org Access

4.1.1. Overview

A Shared Services model of operations drives cost savings and increases

information quality. In an effort to focus business units on their core

competencies, increase efficiencies company-wide, and better manage and access

information, companies consolidate non-revenue generating, administrative tasks

in Shared Service Centers. Eliminating redundant processes, continuously

lowering the unit costs per transaction through self-service, automating

processes, and standardizing common business practices reduces costs. By

centralizing information through a Shared Service Center, a consolidated view of

essential decision-making information is available and accessible globally.

Standardization of common business practices also adds to the timeliness and

accuracy of data. With consistent business processes throughout the enterprise,

information can be gathered uniformly, with consistent quality.

Services can be shared at many different levels, and shared service centers can

exist for different reasons. For example, many Oracle customers have created

Shared Service Order desks, Shared Service Reporting Centers, Shared Service

General Ledger Centers, Shared Service Disbursement Centers, Shared Service

Inventory Management Centers, Shared Service Procurement Centers and so on.

Many of these centers may be combined as one center.

This chapter discusses release content facilitating sharing services in subledger

products. Various products exploit these features to provide powerful cross

organization processes, and exploit the intercompany features to supply the

mandatory and appropriate interorganization accounting.

4.1.2. Features

4.1.2.1. Multi-Org Access Control

Multi-Org Access Control enables companies that have implemented a Shared

Services operating model to efficiently process business transactions by allowing

them to access, process, and report on data for an unlimited number of operating

units within a single applications responsibility. This increases the productivity

of Shared Service Centers, as users and processes no longer have to switch

applications responsibilities when processing transactions for multiple operating

units at a time. Data security and access privileges are still maintained using

security profiles that now support a list of operating units.

4.1.2.2. Multi-Org Security Profile Preferences

A Multi-Org Security Profile defines the list of operating units to which a user

has access. If a user typically uses a subset of the operating units in his security


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profile, he may set up Preferences to limit the operating units available to him

during transaction processing. The user can also set a default operating unit to

minimize manual data entry when an operating unit context is required.

4.1.2.3. Enhanced Multi-Org Reporting

Consistent with the Multi-Org Access Control feature, users are able to run

reports using two levels:

Ledger: The report runs for all operating units within a ledger to which the

user has access

Operating Unit: The report runs for a selected operating unit that belongs to

the users security profile

4.1.2.4. Multi-Org Integration with Accounting Setup Manager

The Accounting Setup Manager is a central location to define your accounting-

related setup across all financial applications. Here, you can define your legal

entities and their accounting context, which includes the ledgers that will contain

the accounting data for each legal entity. Multi-Org is integrated into theAccounting Setup Manager such that users can define operating units and their

relationship to ledgers. For each operating unit, users can also select a legal

entity to provide a default legal context during transaction processing. This

centralizes your setup and makes it easier to inquire on and maintain

relationships between ledgers, legal entities, and operating units.


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4.2. Oracle Cash Management

4.2.1. Overview

Oracle Cash Management is an enterprise-wide solution for managing liquidity

and controlling cash.

4.2.2. Features

4.2.2.1. Bank Account Model

Shared Service approaches to disbursement and collections are enhanced by the

deployment of Oracle Cash Managements new Bank Account model.

Overall, the set up, maintenance, and control of all internal bank account

information is much easier and more reliable with this new feature. It provides a

single access point for defining and managing internal bank accounts for Oracle

Payables, Oracle Receivables, Oracle Payroll, Oracle Cash Management, and

Oracle Treasury. Bank account access for each application is explicit for internalsecurity and control purposes. Each account is associated with a Bank and Bank

Branch defined in Oracles common Trading Community Architecture (TCA).

A single Legal Entity is granted ownership of each internal bank account. One or

more Organizations are granted usage rights, which provides significant benefits

in key areas like reconciliation that previously required managing multiple

account records for these types of purposes. Additionally, reconciliation options

can now be defined at the bank account level, providing even more flexibility

and control of that process.

4.2.2.2. Multi-Org Access Control

Multi-Org Access Control enables companies that have implemented a Shared

Services operating model to efficiently process business transactions by allowing

them to access, process, and report on data for an unlimited number of operating

units within a single applications responsibility. This increases the productivity

of Shared Service Centers for users no longer have to switch applications

responsibilities when processing transactions for multiple operating units at a

time. Data security is still maintained using security profiles that are defined for

a list of operating units and determine the data access privileges for a user.

Support for Shared Services, and related Multi-Org Access Control features, is

available in Oracle Cash Management. This set of features greatly enhances

processing and reporting efficiency for Oracle Cash Management users. Please,refer to the full feature descriptions in the Multi-Org Access section of this

document for more details.

4.2.2.3. Subledger Accounting

Oracle Subledger Accounting provides tools that allow users to meet External

Reporting (IAS.IFRs, US GAAP, etc.), corporate management, and national

fiscal accounting requirements. With a flexible tool called Accounting Methods

Builder, users can determine the accounts, lines, descriptions, summarization,


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and dates of their journal entries. Users can also add detailed transaction

information to journal headers and lines. Detailed subledger accounting journals

are available for analytics, auditing, and reporting. They are summarized,

transferred, imported and posted to Oracle General Ledger. For more details,

please see the Oracle Subledger Accounting section of this document.

Oracle Cash Management utilizes Oracle Subledger Accounting for setting up

accounting rules and for generating journal entries related to Cash Managementtransactions.

4.2.2.4. Bank Account Balances and Interest Calculation

Many new bank account balance types are supported for all internal bank

accounts including ledger, available, value dated, 1-day float, 2-day float, and

projected balances. Users are able to track closing ledger and available balances

as well as month-to-date and year-to-date averages. Flexible reporting tools are

available to view all this centrally stored balance history for trend analysis as

well as to compare actual versus expected balances based on daily cash position

projections. Additionally, the system allows the user to verify interest amounts

charged or credited by their banks based on balance history and user-definedinterest rate schedules.

4.2.2.5. Bank Account Transfers

Bank Account Transfer functionality was previously supported only through

Oracle Treasury. Now, bank account transfers are supported directly in Oracle

Cash Management. This feature allows users to create these types of cash

transfers between internal bank accounts manually or automatically through

physical cash pools. The related cash flows are stored in Oracle Cash

Management for reporting purposes and are reflected in positioning. Payment

processing and accounting is managed via Oracle Payments and Oracle

Subledger Accounting.

4.2.2.6. Cash Pooling

Organizations frequently use cash pooling techniques to optimize funds by

consolidating bank balances from across multiple bank accounts. By

consolidating balances and minimizing idle funds, organizations may decrease

external borrowing costs and increase overall investment returns.

Oracle Cash Management supports common cash pooling techniques by allowing

users to group bank accounts into different types of pooling structures and by

managing the associated activity for either centralized or decentralized business

environments. This functionality was originally made available to OracleTreasury users in Oracle Financials Family Pack G and will now be supported

via Oracle Cash Management. The following types of cash pools are supported.

4.2.2.6.1. Self-Initiated Physical Cash Pools

Organizations may choose to monitor individual bank account balances

manually and then physically move cash to or from their accounts only as

needed based on their particular preferences or objectives.


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Oracle Cash Management allows users to define and manage these types of

bank account structures called Self-Initiated Physical Cash Pools. These

pool definitions include rules to automatically determine when bank account

transfers should be made and for what amounts. Users are able to review

transfer proposals from their Cash Positions based on daily activity as well as

target balances, minimum transfer amounts, and rounding rules. Users are

able to accept or overwrite system proposed transfers, and Oracle Cash

Management then generates all their bank account transfers automatically.

Note: Cash Pools spanning multiple legal entities often require tracking

internal loans and interest, or In House Banking. Related functionality is

available for Oracle Treasury users and is described in the Oracle Treasury

section of this document.

4.2.2.6.2. Bank-Initiated Physical Cash Pools, or Zero Balance Accounts

(ZBAs)

Organizations may choose to utilize a bank service that automatically sweeps

all end-of-day balances to or from main concentration accounts. Since this

type of physical cash pool arrangement typically leaves no cash in the sub

accounts overnight, it is often referred to as a Zero Balance Account or ZBArelationship.


bank account structures called Bank-Initiated Physical Cash Pools. Oracle

Cash Management automatically creates and reconciles all the related sweep

transactions based on reported prior-day bank statement activity.

Note: Cash Pools spanning multiple legal entities often require tracking

internal loans and interest, or In House Banking. Related functionality will

be available for Oracle Treasury users and is described in the Oracle

Treasury section of this document.

4.2.2.6.3. Notional Cash PoolsOrganizations may choose to utilize notional cash pool arrangements offered

by banks that track not only individual account balances but also the net

balance across all accounts. This technique is common in some countries

and does not require physical cash transfers to be made between accounts for

concentration purposes.


bank account structures called Notional Cash Pools. The consolidated

notional account balance is calculated, and users are able to manage the net

notional balance along with individual bank accounts in Oracle Cash

Management.

4.2.2.7. Bank Statement Accounting

This feature allows users to define mapping rules that can automatically create

and reconcile transactions in Oracle Cash Management based on reported prior-

day bank statement lines. Users are able to define flexible matching rules based

on bank accounts, transaction codes, and text search strings. This feature

significantly reduces reconciliation issues associated with repetitive first notice

items like bank fees or bank account interest. The transactions generated and

stored in Oracle Cash Management are available for reporting as well as for


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automatic reconciliation. Accounting for these transactions is managed via

Oracle Subledger Accounting.

This feature was first released in Oracle Financials Family Pack G.

4.2.2.8. Bank Account Signing Authorities

This feature allows Oracle Cash Management users to enter, maintain, and reporton those people in their organizations with bank account signing authority. Users

are able to indicate single and joint signing limits for each bank account as well

as signer group categories, effective dates, approval status, and other relevant

information. Users are also allowed to attach electronic copies of documents like

passport photos, signature files, or bank documents directly to the signing

authority records. It is possible to use Oracle Workflow to route approval

requests for signing authority, or users can set statuses manually. Reporting used

for internal control and audit purposes is available via an Oracle Discoverer

view. People with signing authority need to be defined in Oracle HRMS or via

HR Foundation, if Oracle HRMS is not installed.


4.2.2.9. Cash Positioning Intra-day Activities

This feature provides additional flexibility in how users view intra-day bank

statement activity in their cash positions. It is possible to include all or portions

of intra-day bank statement activity in the cash position, and these cash flows are

used when calculating projected closing balances. Alternatively, the set up for

cash positions still allows users to exclude the intra-day bank statement activity

entirely or to include it for reference purposes against expected activity from

other sources (but not include intra-day bank statement activity in the calculation

of closing projected balances).



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4.3. Oracle General Ledger

4.3.1. Overview

Oracle General Ledger delivers extraordinary enhancements in this release so

you can maximize accounting process efficiencies across your enterprise while

still achieving a high level of information and setup security. Fundamentalimprovements in Oracle General Ledger enable you to perform simultaneous

accounting for multiple reporting requirements and allow superusers to access

and process data for multiple ledgers and legal entities at the same time powering

ledger and reporting shared services. For those users who should have more

limited access, you can secure both information and setup definitions, like

MassAllocations and FSG reports, so they can only view, update, or execute

those processes to which they have access. You are able to achieve a high level

of efficiency and security, without having to sacrifice one for the other, with

these new enhancements in Oracle General Ledger.

4.3.2. Features

4.3.2.1. Accounting Setup

4.3.2.1.1. Simultaneous Accounting for Multiple Reporting Requirements

Companies that are global in nature and that have operations in different

localities often have multiple reporting requirements. These companies and

their subsidiaries often need to satisfy the accounting and reporting

requirements for each country as well as those of the parent company. This

involves performing accounting in accordance with accounting principles

and standards of multiple countries and in different currencies, charts of

accounts, and/or calendars. The reporting requirements can also be statutory

in nature, and one subsidiary may even need to satisfy multiple sets of

statutory requirements. Oracle General Ledger simplifies the simultaneous

management of the accounting for all of these different reporting

requirements in this latest release. You are able to define your legal entities

and the setup needed to address each accounting and reporting requirement

using the Accounting Setup Manager. New enhancements and integration

with Subledger Accounting enable Oracle General Ledger to perform

accounting for all reporting requirements of a legal entity simultaneously.

4.3.2.1.2. Centralized Accounting Setup

The Accounting Setup Manager is a central location to define your

accounting-related setup across all financial applications. Here you can

define your legal entities and their accounting context, which includes theledgers* that contain the accounting data for each legal entity. If a legal

entity has multiple reporting requirements, you can include additional

reporting currencies or ledgers in the accounting context to satisfy the

additional requirements.

4.3.2.1.3. Enhanced Reporting Currency Functionality

Multiple Reporting Currencies functionality is enhanced to support all

journal sources. Reporting sets of books are now simply reporting

currencies. Every journal that is posted in the primary currency of a ledger


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can be automatically converted into one or more reporting currencies. This

conversion can be performed by Subledger Accounting, to convert all

subledger journal entries, or by General Ledger, to convert more summarized

General Ledger journals. You can choose to convert any journal sources and

categories.

4.3.2.2. Improved Processing Efficiency

4.3.2.2.1. Simultaneous Data Access to Multiple Legal Entities and

Ledgers

You can access multiple legal entities and ledgers when you log into Oracle

General Ledger using a single responsibility. This improves processing

efficiency by reducing the need to switch between responsibilities when

trying to access data for different ledgers or legal entities.

4.3.2.2.2. Simultaneous Opening and Closing of Periods for Multiple

Ledgers

The Open and Close Periods Programs has multiple enhancements. You are

able to run any of the Open and Close Periods Programs from the Concurrent

Manager. This allows you to take advantage of scheduling and request setcapabilities for greater processing efficiency. Also, if you manage multiple

ledgers, you can open or close periods for multiple ledgers simultaneously.

You can even keep the status of periods across multiple ledgers in synch with

new programs that ensure a specific period is Open or Closed for all of the

ledgers you manage.

4.3.2.2.3. Cross-Ledger and Foreign Currency Allocations

You are able to allocate financial data from one or more ledgers to a different

target ledger. This enables you to perform cross-ledger allocations, which is

useful for purposes such as allocating corporate or regional expenses to local

subsidiaries when each entity has its own ledger. This is possible even if the

target ledger is in a different currency than the source ledger(s) because you

can create allocations in foreign currencies. Foreign currency allocations are

also useful within a single ledger if you need to allocate amounts to a

currency that is different from the primary currency of a ledger.

4.3.2.2.4. Simultaneous Currency Translation of Multiple Ledgers

If you manage multiple ledgers, you can run the Translation program for

multiple ledgers simultaneously.

4.3.2.2.5. Financial Reporting Across Ledgers

You are able to run Financial Statement Generator (FSG) reports for multiple

ledgers simultaneously. This is useful if you manage multiple ledgers andwant to run a balance sheet or income statement report for all of your ledgers

at the same time. You can also create an FSG report that includes data from

multiple ledgers in a single report; the data in each ledger can be displayed in

a separate row or column, or data from multiple ledgers can be aggregated

into a single row or column. This is useful for reports such as consolidating

financial statements that display data for each subsidiary in separate columns,

as well as aggregated data in a total column.

4.3.2.2.6. Automatic Journal Copy


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You are able to automatically copy an existing journal batch to create a new

journal batch with the same journals and journal lines. This reduces the

amount of work you need to do to re-create a journal that has already been

defined. During the copying process, you have the option to change the

period and effective date of the journal batch.

4.3.2.2.7. Streamline Automatic Posting

AutoPost Criteria can be shared across ledgers that have the same chart ofaccounts and calendar. This dramatically reduces the number of AutoPost

Criteria sets you need to define. Furthermore, you can automatically post

journals across multiple ledgers simultaneously.

4.3.2.2.8. Streamline AutoReversal Criteria Setup

AutoReversal Criteria can be shared across ledgers. This dramatically

reduces the number of AutoReversal Criteria sets you need to define.

4.3.2.2.9. Streamline Consolidation Mappings

You are able to define Chart of Accounts Mappings (formerly known as

Consolidation Mappings) between two charts of accounts. Therefore, if you

have multiple Consolidation Definitions for parent and subsidiary ledgersthat share the same chart of accounts pair, and their mapping rules are the

same, you only have to define a single Chart of Accounts Mapping. This

significantly reduces the number of mappings you need to define if your

Consolidation Definitions involve the same pair of charts of accounts and the

mapping rules are the same.

4.3.2.2.10. Replacement for Disabled Accounts

When an account is disabled, you can prevent transactions that include the

account from erroring during journal import by defining a replacement

account for the disabled account. Journal import replaces the disabled

account with the replacement account and continue the journal import

process if the replacement account is valid. This improves processing

efficiency by preventing the journal import process from erroring and

enabling the successful creation of the journal with minimal user intervention

when an account has been disabled.

4.3.2.3. Data Security

4.3.2.3.1. Data Security across Legal Entities and Ledgers

In this release, since you can access multiple legal entities and ledgers when

you log into Oracle General Ledger using a single responsibility, Oracle

General Ledger provides you with flexible ways to secure your data by legal

entity, ledger, or even balancing segment values or management segmentvalues. You are able to control whether a user can only view data, or

whether they can also enter and modify data for a legal entity, ledger,

balancing segment value or management segment value.

4.3.2.3.2. Management Reporting Security

You can designate any segment (except the natural account segment) of your

chart of accounts to be your management segment and use Oracle General

Ledgers security model to secure the management segment for reporting and

entry of management adjustments.


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4.3.2.3.3. Prevent Reversal of Journals with Frozen Sources

Journals with frozen journal sources are prevented from being reversed to

streamline the reconciliation of data from Subledger Accounting sources.

4.3.2.3.4. Prevent Reversal of Unposted Journals

Users are no longer allowed to reverse Unposted journals.

4.3.2.3.5. Control Accounts

You are able to control data entry to an account by ensuring it only contains

data from a specified journal source and to prevent users from entering data

for the account either in other journal sources or manually within general

ledger.

4.3.2.3.6. Definition and Setup Security

You can secure your setup and definitions by granting specific privileges to

users to view, modify, and/or execute a definition. This enables you to

control which of your users can view a definition, but not modify or execute

it, or execute a definition without modifying it, or vice versa. For example,

since MassAllocations and Financial Statement Generator components are

sharable across ledgers that have the same chart of accounts, you can secure

these definitions so that some users cannot view or modify the definitions

created by other users. Following is a list of definitions that have this

security available:

MassAllocation and MassBudget Formulas

FSG Reports and Components

Accounting Calendars

Transaction Calendars

AutoPost Criteria Sets

AuoReversal Criteria Sets

Budget Organizations

Chart of Accounts Mappings

Consolidation Definitions

Consolidation Sets

Elimination Sets

Ledger Sets

Recurring Journals and Budget Formulas

Rate Types

Revaluations

4.3.2.4. Auditability

4.3.2.4.1. Accounting and Reporting Sequencing

Sequential numbering of accounting entries is a strong business requirement

in many countries in Europe, Asia Pacific and Latin America and is used by

fiscal authorities to check the completeness of a companys accounting

records. You can assign sequence numbers to journals during the posting

process to ensure that finalized journal entries are properly sequenced.

Separately, you can also assign a sequence number to journals when a period

is closed to sequence journals for reporting purposes.


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4.3.2.4.2. Journal Line Reconciliation

The GL Entry Reconciliation feature within Oracle Financials Common

Country features is part of Oracle General Ledger and renamed Journal Line

Reconciliation. This feature enables you to reconcile journal lines that

should net to zero. This is often done to reconcile suspense accounts, or in

countries like Norway, Germany, or France, it is used to audit or reconcile

payroll and tax payable accounts, or to verify the open balances of specific

accounts at the end of the period.

4.3.2.5. Others

4.3.2.5.1. Entered Currency Reporting and Analysis

Oracle General Ledger tracks the balances that are entered in your ledgers

primary currency. This enables customers to perform currency analysis on

amounts that are entered in the ledgers primary currency for the purposes of

currency valuation and hedging.

4.3.2.5.2. Foreign Currency Recurring Journals

You can use Recurring Journals to create foreign currency journals. This

enables you to pre-define journals that are recurring in nature and that are in

foreign currencies and simply generate them when you need them. For

example, a subsidiary (with a different primary currency than its parent

company) that has borrowed money from its parent company can generate a

recurring monthly interest payable entry to the parent company in the

parents currency.

4.3.2.5.3. Intercompany Balancing Support for Encumbrances

Intercompany encumbrance journals are automatically balanced during

journal posting.

4.3.2.5.4. New iSetup APIs

Oracle General Ledger adds the following iSetup APIs to enable you to

quickly create your setup data and definitions:

Ledger Sets

Data Access Sets

4.3.2.5.5. Integration with Subledger Accounting

Oracle Subledger Accounting provides tools that allow users to meet multi-

gaap, corporate, and fiscal accounting requirements. With a flexible tool

called Accounting Methods Builder, users can determine the accounts, lines,

descriptions, summarization, and dates of their journal entries. Users can

also add detailed transaction information to journal headers andlines. Detailed subledger accounting journals are available for analytics,

auditing, and reporting. They are summarized, transferred, imported and

posted to Oracle General Ledger.

Oracle General Ledgers integration with Subledger Accounting provides a

unified process to post data to general ledger from Oracle subledgers and

external feeder systems. Also, it provides a consistent view when drilling

down from general ledger balances to subledger transactions. Please refer to


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the Oracle Subledger Accounting section of this document for more

information.

4.3.2.5.6. Enhanced Intercompany

The Global Intercompany System (GIS) feature from previous releases has

been incorporated into the Oracle Advanced Intercompany System product.

Please refer to the Oracle Advanced Global Intercompany System section of

this document for more information.

4.3.2.5.7. Account Analysis and Drilldown

Account Analysis & Drilldown is a new web-based interface that allows you

to easily review and analyze your general ledger financial data. You can view

the balances of multiple detail or summary accounts in a single page and drill

down to supporting journal entries and subledger transactions all within a

browser window. You can control the display of your data by choosing from

various layouts, specifying your sort criteria, or defining filters to only

retrieve balances that meet your specific conditions. After fine-tuning your

personal search criteria, you can even save the search criteria for future use.

These features give you immediate access to your live general ledger data so

that you have the information you need to make better business decisions.

Note: This feature was first released in Oracle Financials Family Pack G.

4.3.2.5.8. GL Standard Reports Integration With XML Publisher

Oracle General Ledgers Account Analysis, General Journals and Trial

Balance standard reports are now integrated with XML Publisher. Using

XML Publisher allows you to leverage the formatting features of a word

processing application to design the layout of your report. You can

personalize your report by changing fonts, adding images, inserting headers

and footers, creating borders, changing column widths, and reordering/

adding/deleting columns. This enables you to create professional-quality

reports directly from the general ledger, which ensures the integrity andauditability of the information. For more information on all formatting

features, please refer to the XML Publisher User Guide.

Note: This feature was first released in Oracle Financials Family Pack G.

4.3.3. Terminology

Term Definition

LedgerDefined in Oracle General Ledger, one or more legal or

business entities that share a common chart of accounts,

calendar, currency, and accounting method. Ledgersreplace set of books in Release 12.

Ldger setsA group of ledgers that share the same chart of accounts

calendar, and period type. In Oracle General Ledger, the

enable you to perform certain operations for multiple

ledgers at the same time, i.e. opening periods and runnin

reports.

Set of booksSet of books is converted to a ledger in Release 12. See


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Term Definition

ledger.


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4.4. Oracle Subledger Accounting New Product

4.4.1. Overview

Oracle Subledger Accounting is a new product in this release.

Oracle Subledger Accounting enables corporations to comply with corporate,

local and managerial accounting and audit requirements via increased control,

visibility and efficiency.

Oracle Subledger Accounting increases control by storing a complete and

balanced journal entry for each subledger transaction and GL date. Detailed

drilldown and audit information is captured for each journal entry line. By

storing journal entries in a common data model, Oracle Subledger Accounting

constitutes a single source of truth for all accounting, reconciliation and

analytical reporting. As Oracle Subledger Accounting stores the articulated

balance sheet side of every entry and cross references it to the businesstransactions evidentiary document, reconciliation from General Ledger through

Subledgers to the documents and from there to the business transactions is

greatly simplified.

Oracle Subledger Accounting facilitates exercising internal control and policy by

implementing accounting rules you define. The rules refer to system data from

many sources, and can be tailored very finely by document type and document

line.

Oracle Subledger Accounting streamlines the close by providing a common

posting engine, so that all subledger products and non-Oracle products can

transfer controlled and summarized data to the General Ledger using a standardmethodology and auditable, reviewable process.

Oracle Subledger Accounting improves efficiency by speeding period close,

simplifying business and regulatory changes and making acquisitions easier.

Oracle Subledger Accounting increases management visibility by supporting

multiple parallel accounting representations. Corporate accounting policies can

be defined and implemented globally; free from limitations imposed by local

fiscal reporting requirements. Oracle Subledger Accounting allows accounting

policies to be created once and deployed many times. Minimization of

maintenance and elimination of duplication makes accounting policies easier to

implement, maintain and hence, control. Subledger accounting enables businessusers to control all aspects of journal entries including debits and credits;

accounting flexfields, descriptions and GL date

4.4.2. Features

4.4.2.1. Journal Entry Setups

Oracle Subledger Accounting gives users control over the definition of their

journal entries.


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Users are able to define the following components of journal entries:

GL Dates

Entry Descriptions

Line Descriptions

Amounts (accounted and gain/loss)

Accounts: rules can be created for either the entire account combination or

for individual segments based upon constants or from transaction information

Journal Lines: side, summarization, type

Reconciliation References

The definition of these components can be based upon information from

subledger applications such as transaction or setup values. Conditions may be

used to determine how and when many of these components are used, and to

create defaults. Setups can be quickly copied and altered to modify seeded

definitions. Multi-language support is available for journal entry descriptions.

For each setup, Oracle Subledger Accounting stores information to determine

whether it was seeded or completed by the user allowing customers to take

advantage of upgrades without worrying about overwriting their customized

setups.

4.4.2.2. Date Effective Application Accounting Definitions

Oracle Subledger Accounting allows users to group a consistent set of journal

entry setups used in generating accounting for the transactions of an application.

These are called application accounting definitions. For example, a user can

create an application accounting definition that consists of setups to provide a

U.S. GAAP representation of their inventory accounting.

Because accounting requirements change over time, Oracle Subledger

Accounting provides the ability to enter date ranges for application accounting

definitions. Multiple application accounting definitions can be created for eachproduct with different date ranges. New definitions can be tested and

implemented in advance of required changes and scheduled to automatically take

effect on a chosen date. The setups related to an application accounting

definition can be locked to prevent changes.

4.4.2.3. Multiple Accounting Representations

Oracle Subledger Accounting offers the ability for users to create multiple

accounting representations for the same subledger transactions each to be stored

in a separate ledger. These can be used to meet mutually exclusive accounting

requirements.

For example, a customer may need to use a fiscally mandated chart of accounts

and at the same time create a corporate representation using a management chart

of accounts. Any of the Oracle Subledger Accounting journal entry setups can

vary by representation.

4.4.2.3.1. Summarization Options


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For each ledger, customers can decide, by application, whether they would

like to summarize their journal entries. If they would like to summarize, they

can do it either by GL Date, or by GL Period.

4.4.2.3.2. Draft Accounting

When users create accounting they can elect to use draft mode. This allows

them to view and report on the accounting without saving it. They can

change Oracle Subledger Accounting setups or transaction data if they aredissatisfied with the accounting for any reason. The accounting can be

recreated as final, and any changes in setups or data will be used to derive the

final accounting.

Draft accounting may be used in an unlimited manner for each journal entry

allowing iterative corrections before committing the accounting as final.

This minimizes the need for correcting journal entries and facilitate a clean

audit.

4.4.2.4. Online Accounting

Users have the ability to immediately create, view, transfer and post accountingin General Ledger when entering transactions into Oracle subledger applications

such as Oracle Payables and Oracle Receivables.

Oracle Subledger Accounting uses the same accounting rules and validations for

both the offline and online accounting. Users can create the accounting online in

draft mode, which allows them to preview accounting online, and to make

adjustments before accounting in final mode.

4.4.2.5. Replacement for Disabled Accounts

When an account is disabled, users can continue creating accounting for

transactions that include the account, without erroring. Oracle SubledgerAccounting replaces the disabled account with the replacement account and

continues processing. This improves processing efficiency by enabling the

successful creation of journal entries with minimal user intervention if an account

has been disabled.

Oracle Subledger Accounting stores substituted disabled accounts on subledger

journal lines for audit and reconciliation purposes.

4.4.2.6. Process Category Accounting

Users are able to elect to account for a limited subset of their journals based upon

business transaction entities using process categories.

4.4.2.7. Straight Through Accounting Processing

Oracle Subledger Accounting allows users to create subledger accounting and

transfer and post the GL accounting in a single step. When creating journal

entries either online or offline by the concurrent program, users can choose to

immediately transfer and post the accounting in General Ledger. Oracle

Subledger Accounting therefore supports straight through processing from the

subledger transaction to General Ledger balances.


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4.4.2.8. On-line inquiries

Oracle Subledger Accounting provides multiple inquiries to view subledger

accounting. Key transaction information are stored so users can easily

understand what transaction has been accounted.

For example, a journal entry for an Oracle Receivables invoice includes the

customer name, customer number, the source, the transaction type, transaction

date, and the invoice number.

Users can inquire upon all the accounting for a transaction either from the

transaction workbench or from a common inquiry form. In the case of

multiple accounting representations, they can compare the journals for each

representation side by side to see the differences

Users can inquire based upon subledger journal entry header information

such as the GL date, or the ledger

Users can inquire based upon subledger journal entry line information such

as the amount or account

Users can view their subledger journal entries in a T-account format

Oracle Subledger Accounting takes advantage of the Oracle personalization

framework that allows users to customize their view of the accounting using any

of the attributes of the journal entry and to save predefined searches. Embedded

flows support a bi-directional drill between journal entry headers, lines, T-

accounts, and transaction data.

4.4.2.9. Journal Entry Sequencing

Oracle Subledger Accounting supports two different mechanisms of sequencing

its journal entries. The sequencing information is available for querying and

display of journals.

4.4.2.9.1. Accounting Sequencing

Oracle Subledger Accounting assigns a sequence to its journal entries as they

are completed.

4.4.2.9.2. Reporting Sequencing

Oracle Subledger Accounting supports separate sequencing designed to meet

legal requirements in Southern Europe. The reporting sequenceis assigned

to both the subledger and general ledger journal entries when the General

Ledger period is closed. This feature replaces the Accounting Engine (AX)

legal sequencing and Libro Giornale features.

This type of sequencing is used by most of the legal reports required in some

countries as the main sorting criterion to display the journal entries

4.4.2.10. Third Party Merge Accounting

Users have the ability to account for changes in third parties. These would

include correcting the third party related accounting if the party involved in the

transaction was incorrect, or managing the impact of third party merges or

acquisitions on control accounts.


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4.4.2.11. Manual Journal Entries

Oracle Subledger Accounting offers manual subledger journal entries that are

within the context of an application. These can be used to record changes in

third party information or reference values. Manual entries can be accounted on-

line. They can be accessed via on-line inquiries and reports.

4.4.2.12. Third Party Control Accounts

Oracle Subledger Accounting stores balances for control accounts by customer

and supplier. It uses a new key accounting flexfield qualifier that allows users to

specify control accounts. General Ledger also prevents the entry of manual

journal entry lines for control accounts thus ensuring that subledger control

account balances are consistent with General Ledger balances for the same

account combination.

To calculate the balances, Subledger Accounting uses the customer and supplier

information it stores on journal entry lines. Users can complete inquiries based

upon the customer and supplier information. Reports are available that detail, by

third party, the journal lines that are used to create the balance for each third

party control account.

4.4.2.13. Transaction Account Builder

Transaction Account Builder provides a flexible mechanism to derive default

accounts for transactions. Product development and implementation teams can

create rules to determine the accounts that will be defaulted onto transactions.

Rules can be created for either an entire account combination or for individual

segments. They can be based upon transaction information or created as constant

values.

4.4.2.14. Multi-period Accounting

Users can create accrual and recognition journal entries to allocate costs over a

range of accounting periods.

When creating transactions, users specify the date range for which a line should

be accounted. The standard Subledger Accounting journal entry setups such as

how to determine the account and description of the subledger journal entry lines

are available for defining both the accrual and recognition journal entries.

Users can also configure the GL dates, a prorating method, and have the ability to

create a single recognition journal based upon the multiperiod end date.

Recognition journals for future periods are created as incomplete until the periodis open or enterable and are available for inquiries and reports.

4.4.2.15. Accrual Reversal Accounting

Users can indicate that a journal entry should automatically be reversed on either

the next day or in the next GL period. This feature can be used for period end

accruals or for other accounting that requires an automatic reversal of an accrual.


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It is possible to drill to the related reversal when viewing an accrual journal entry

and vice versa.

4.4.2.16. Business Flows

Users can create accounting policies based upon both intra and inter-product

business flows. This allows accounting definitions to explicitly handle cases

where there is a logical relationship between accounting for two or moretransactions faclitating reconciliation for intermediary accounts.

Examples are as follows.

When creating the accounting for a payment, the user can indicate that the

account used to book the invoice liability through the invoice transaction

should be relieved

When accounting for a Payables invoice matched to a receipt, the user can

indicate that the receipt accrual booked at the time of receipt be relieved and

that the description from the receipt be used

4.4.2.17. Accounted and Gain/Loss Amount Calculations

Subledger Accounting can use conversion information such as the conversion

rate, entered amount and currency information to calculate accounted and

gain/loss amounts.

Rules can be created that determine the account used to account for gain or loss

based upon whether there is a gain or a loss.

4.4.2.18. Application Accounting Definitions Loader

The Application Accounting Definitions (AAD) Loader enables customers to

import and export application accounting definitions and journal entry setups.Users can build and test their journal entry setups on a test instance, export them,

and then import them to their production instance.

The AAD Loader also supports concurrent development and version control of

the application accounting definitions.

4.4.2.19. Errors Accounting and Reporting

Subledger Accounting creates journals as completely as possible, even if there

are conditions that make the journal invalid. These journals have an error status

and are not eligible for GL transfer and posting. However, they are useful for

troubleshooting setup and information issues.

For example, if the journal entry has a GL date in a closed period, the entry is be

created and an error message indicates that the GL date must be adjusted or the

period must be opened.

To minimize reconciliation issues, Subledger Accounting ensures that when there

are multiple representations, all journals related to a given transaction must be

valid before they may be accounted.


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Users can resubmit a request to create accounting and specify that they would

like to only process entries that have previously had errors. Errors may be

viewed both on standard XML Publisher templates and via on-line inquiries.

4.4.2.20. Standard Reports

Oracle Subledger Accounting reports is built to allow users to take full advantage

of the features of Oracle XML Publisher. Oracle Subledger Accounting deliversdata definitions and Oracle XML Publisher templates for the following reports:

Journal Entries Report: This report provides detailed journal entry

information on a transaction-by-transaction basis for a period or period range

Account Analysis Report: This report provides drill-down information

about the movement on a particular account or account range for a period or

period range

Third Party Balances Report: This report provides balances and account

activity information for suppliers and customers for a period or period range

Open Account Balances Listing: This report gives users the ability to net

account activity across all the journals related to a document, and to reconcilethe outstanding amounts with the GL balances. This report replaces existing

product functionality such as the Payables Trial Balance

4.4.2.21. Enhanced Reporting Currency Functionality

Multiple Reporting Currencies functionality is enhanced to support all journal

sources. Reporting sets of books are now known simply as reporting currencies.

Every journal that is posted in the primary currency of a ledger can be

automatically converted into one or more reporting currencies. This conversion

can be performed by Subledger Accounting, to convert all subledger journal

entries, or by General Ledger, to convert more summarized General Ledger

journals. You can choose to convert any journal sources and categories.

4.4.2.22. Diagnostics Framework

Oracle Subledger Accounting relies upon transaction information provided by

other applications to create accounting. The Diagnostics Framework provides a

tool to view the information used to create subledger journal entries.

This can assist in understanding how the journal entry setups were used to create

journals. It can also be useful for Oracle support and for customers using

Subledger Accounting to better understand the information provided to

Subledger Accounting.

The results of the diagnostics are available as an HTML report.

4.4.3. Oracle Subledger Accounting Enhances the Functionality of the

Global Accounting Engine

In this release, Oracle Subledger Accounting replaces the Global Accounting

Engine. Oracle Subledger Accounting further extends the Global Accounting

Engine functionality by providing customizable accounting rules via a flexible

and robust accounting rules setup.


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All Global Accounting Engine features are supported by Oracle Subledger

Accounting.

A fully automated migration of all Global Accounting Engine generated data to

Oracle Subledger Accounting is provided.

The following table lists the Oracle Subledger Accounting feature(s) that replace

the functionality of the Global Accounting Engine:

Global Accounting Engine Oracle Subledger Accounting

AX Rules Journal Entry Setups

Subledger Setup Date Effective Application Accounting

Definitions

Dual Posting Multiple Accounting Representations

Draft Accounting Draft Accounting

On-Line Inquiries On-Line Inquiries

AX Sequences Journal Entry Sequences

Customer Merge Third Party Merge Accounting

Manual Journal Entries Manual Journal Entries

Control Accounts Third Party Control Accounts


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The following table lists the Oracle Subledger Accounting reports that replace

the corresponding reports of the Global Accounting Engine. XML Publisher

templates are provided so that any user can comply with their fiscal or statutory

specific reporting requirements.

Global Accounting Engine Oracle

r12 financials rcd

Documents