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Introduction: Fixed Assets is a standalone application. This will come at SOB/PL level.
Key Flex Fields in Fixed Assets: 1. Category KFF 2. Asset Location KFF 3. Asset Key KFF We can create only one structure by using the above KFF Based on the asset life we have to create Fiscal Calendar. For example 1976 to 2030. Depreciation calendar is used to calculate depreciation. Prorate convention calendar is used to prorate the depreciation from which date to which date we have to consider. Mass additions: Process of transferring fixed assets related data from Accounts Payables to Fixed Assets is called Mass additions. After transferring data from AP, data will store in interface tables. AP -- FA Mass additions interface tables ---- FA The data which is there in FA Mass additions interface tables we can see from FA application. 1
Difference between: Detailed addition and Quick addition: As mentioned above for Detailed additions we have to navigate several windows to enter an asset. (Additions, Book and Assignments) Whereas through quick addition button asset information will be maintained by navigating single window only. Latter detailed information would be updated.
Depreciation calculation is in 3 methods: 1. Straight line method 2. Diminition method 3. Production based
Year 3
40500 355000
Asset transfer can be done between Locations, Employees, and Accounts. Asset Changes: through this changes we can change the: Depreciation Prorate Convention Cost Adjustment Life time of Assets 3
a month producing 2000 units. If one month they used the plant per day 3 shifts then the production is 3000 units. As per the regular calculation system will consider depreciation only for 2000 units. But if you want to consider depreciation for 3000 units we have to over ride the depreciation. Over ride the depreciation where there is unplanned activity takes place. System will consider first over ride depreciation and then original depreciation. Retirement: For every asset there will be a useful life of period. Once this period completed every asset should me retired. Some other reasons for retirement: Sale of Asset, Theft, Life of asset and Damage of asset. Roll back depreciation: If we run the depreciation without period close, then we cannot make any modifications. Then if we want to do any modifications we have to do Roll back depreciation.
Types of Books: For Assets, Journals will be created based on the asset book. This Asset book will be associated with the particular Ledger. Asset book will determine the: Calendar Accounting Rules Natural Accounts Ledger for various Fixed Assets.
Pre requisites to create Asset Book: Specify System Controls Define Calendars Set up your Account segment values and combinations Set up your journal entry formats.
In Fixed Assets we have 3 types of books: 1. Corporate Book 2. Tax Book 3. Budget Book
Tax Book: We will maintain the depreciation information by following the Income tax Act. We will copy the Asset information from the corporate book to Tax book. We maintain companies Act and IT Act for depreciation, if the % of depreciation is different for companies act and IT act.
Budget book: We will maintain capital Budget information. The Asset information also required in the tax book. It is an automatic activity We will copy the asset information from the corporate book to the tax book. We have 2 options to copy the information: 1. Initial mass copy 2. Periodic mass copy
Capitalized: Which Asset is started for using and Assets placed for service. CIP: Construction in process: An asset which is under construction, for example building under construction. CIP asset will changed to capitalized when it starts service. Group Assets: Grouping the assets related to same group.
Accumulated Depreciation: Total depreciation from beginning of the asset to till date. YTD depreciation: For particular year Depreciation: For particular period.
Physical Inventory: Process of verification assets information in the Oracle system with the Physical assets.
You can set up as many calendars as you need. Each book you set up requires a depreciation calendar and a prorate calendar.
The depreciation calendar determines the number of accounting periods in a fiscal year.
The prorate calendar determines the number of prorate periods in your fiscal year.
You can use one calendar for multiple depreciation books and as both the depreciation and prorate calendar for a book.
Period name as per Accounting Calendar in GL should be same as in the FA otherwise we cannot transfer information from FA to GL.
Specifying the dates for Calendar periods Your corporate books can share the same calendar. A tax book can have a different calendar than its associated corporate book. The depreciation program uses the prorate calendar to determine the prorate period which is used to choose the depreciation rate. You must initially set up all calendar periods from the period corresponding to the oldest date placed in service to the current period. You must set up at least one period before the current period. At the end of each fiscal year, Oracle Assets automatically sets up the periods for the next fiscal year. 9
Enter the name of the book you want to define. Choose Class as Corporate Complete 3 Tabs
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Asset Category is used to group the Assets based on the Depreciation method and Rate, and also building a relationship with the Asset book.
Category information is common for a group of assets. Oracle Assets defaults these depreciation rules when you add an asset, to help you add assets quickly.
The default depreciation rules that you set up for a category also depend upon the date placed in service ranges you specify.
Pre requisites to set up Asset categories: Set up Category Flex Field Set up depreciation Book Setup Depreciation Calendar & Prorate Convention Calendar Setup Depreciation Methods
Category Types: 3 1. Lease 2. Non Lease 3. Lease holds Improvements Owner ship is 2 types: i) Owned ii) Leased
Step: 1 Define Asset Category Navigation: Setup Asset System Asset Categories Step: 2 Step: 3 Choose appropriate General ledger Accounts Setup default rules
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This process creates the Journal Entries Automatically in the General Ledger. Journal import from general Ledger need not be run both for Primary as well as Reporting Set of Books. 14
1.
Checked, the period will be closed and the next period will be opened automatically. Note: In Fixed Assets, once a period is closed, it cannot be reopened.
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Benefits of Cash Management Forecast cash flows in any currency and in multiple time periods Streamline the reconciliation process Monitor for exceptions and fraud Forecast based on historical or future transactions Manage the cash cycle efficiently and with control
Cash Management Integration Cash Management is integrated with Payables, Receivables and General Ledger. Payables: Payments information automatically transfers to CM without any process. Receivables: to transfer Receipts information to CM remittance process is required. From AR only remitted eligibility transactions will transfer to CM. GL: If we have entered any journal in GL with cash account, that data will flow to CM. 16
Reconciliation: Normally at the end of every period, the entries in the cash book are compared with entries in the pass book. The exact causes of differences are scrutinized and then bank reconciliation statement is prepared. Necessary suitable entries will passed in the cash book.
Reconciliation process is 3 types: 1. Manual Clearing Process 2. Manual Reconciliation 3. Automatic Reconciliation
Manual Clearing Process: In this process we will manually clear the transactions without entering the bank statement into Oracle.
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1. 2.
Reconcile all your bank statements. Transfer all transactions from Payables to your General Ledger interface
tables. 3. 4. 5. Run Journal Import in General Ledger. Post journals in General Ledger. Run the GL Reconciliation Report from Cash Management for each bank
account. This report compares the statement balance you specify to the General Ledger ending balances. 6. 7. Review the report for errors. If there are errors in the report, correct them in Cash Management, as
needed. Repeat the above steps until there are no more errors.
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