Oracle Release 12 Awareness Session Finance Track

Location: Hyderabad

Date: February 18th, 2008

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Agenda

R12 : New Financial Architecture:

Ledger & Ledger Sets Oracle Legal Entity Configurator Accounting Set Up Multi Org Access Control - MOAC Multi Currency Support Sub Ledger Accounting - SLA Oracle E-Business Tax (EB Tax) Centralized Business Functions Centralized Bank Model Intercompany Processing using Advanced Global Intercompany(AGIS)

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Comparison of General Ledger in 11i vs R12

11i
1. Set of Books 2. 3Cs Calendar, Chart of Accounts & Currency 3. Global Accounting Engine 4. Global Intercompany System(GIS) 5. Intercompany Accounts 6. MRC Primary Set of Books 7. MRC Reporting Set of Books 8. Multiple-Posting Set of Books (Global Accounting Engine)

Release 12 1. Ledger
2. 4Cs Additional C : aCcounting method 3. Sub ledger Accounting (SLA) 4. Advanced Global Intercompany System (AGIS) 5. Intracompany Balancing 6. Primary Ledger
7. Reporting Currency 8. Secondary Ledgers

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R12 : New Financial Architecture - Overview

Enable users to perform certain operations for multiple ledgers

Centralized Accounting, Tax Engine, Bank Model & Intercompany Model

Enable users to perform operations for multiple Operating Units without switching responsibilities.

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Multiple Ledgers More Efficient Period-end Processing

Ledger Set Must Share: Chart of Accounts Calendar
Ledger C

Ledger B French Rules Plan Comptable French Calendar

Ledger A US GAAP US COA US Calendar

EUR

EUR

Defined by 4 Cs: USD Accounting Convention Ledger D Chart of Accounts Calendar US GAAP Currency US COA

US GAAP US COA US Calendar

US Calendar

GBP
Ledger Set Benefits:
Cross/Multiple Ledger processing and reporting Data and definitions that can be shared and secured Native support for multiple accounting representations

Reporting Currency
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Multiple Accounting Representations

Parallel Financial Reporting
Ledger B French Rules Plan Comptable French Calendar Ledger A US GAAP US COA US Calendar

2.2

EUR

EUR

Dr

Cr

Centralized Accounting

Single business transaction can create multiple accounting representations and in multiple currencies

Payables Invoice
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Multi Org Access

Functionality
Allows user to access, process, and report on data for an multiple operating units within a single applications responsibility. Data security and access privileges using profiles.

Business Benefits
Improve Efficiency Better information for decision making Shared Service Center Enabling Gain Productivity Savings using economies of scale, hence reducing costs

Simplify Process

Superior Ownership Experience

MOAC
Centralize & Global Accounting Standa rdize Data

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Multi Org Access

Functionality
Security Profiles for data security
MO: Security Profile List of operating units for a responsibility Defined in HR/FA

Steps
Setup: Define Security

OU field on UI
all transactions setup data specific to OU, like transaction type

Enhanced Multi-Org Reporting and Processing

Ledger/Ledger Set parameter on accounting reports and processes OU parameter on other standard reports and processes For example: submit the Payables Open Interface Import w/OU Para null to import all records across all OUs Enhanced Reporting

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Sub-Ledger Accounting (SLA)

Functionality
Allows multiple accounting representations for a single event.
Ex. A purchase transaction can be simultaneously accounted for an increment to inventory for US GAAP or IAS/IFRS accounting, and as also a debit to the P&L for local compliance accounting.

Business Benefits
Centralized Rules & Policies Centralized Accounting definitions Improved Internal controls and compliance Improved reconciliation and reporting Streamlined closing process Auditable and transparent entries

Enhanced Reporting Currency Functionality.

Simplify Process

Superior Ownership Experience

SLA
Centralize & Global Accounting Standa rdize Data

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Centralized Banking and Payments

Funds Disbursements and Capture

2.3

LE
OU A OU B OU C

Bank account is now associated with LE entity rather than Operating Unit Single bank account serves multiple Operating Units Any and all Operating Units associated with a ledger can be permitted to use the bank account

Inventory

Receivables

Projects

Plus
Centralized Credit Card Model Credit Card Encryption Supplier & Customer Banks in TCA
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Work in Process Purchasing

Payables

Assets

E-Business Suite

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Example: Shared Service Disbursement

OU A

OU B
Centralized Accounting

OU C

Single Payment Instruction

Bank

Payments

1. 2. 3.
Invoices

Setup accounting policies Select invoices from multiple OUs Format for bank and disbursement countries Send single instruction to bank Generate separate payments for each OU
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4. 5.

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Centralized Intercompany
Faster Period-End Close
Advanced Global Intercompany System
Manual Entry Open Interfaces / API

2.5

Subledger Invoices & Documents

Generate subledger invoices Control transaction entry with Intercompany Calendar Fully Configurable Approval Rules Centrally defined Intercompany Accounts Transaction-level balancing

Online Reconciliation Reporting

Excel (Web ADI)

XML Publisher Reports

Dr

Cr

General Ledger

Subledger Accounting

Receivables

Payables

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R12: SLA vis--vis Global Accounting Engine in 11i

11i
Functionality available only in France, Greece, Italy, Spain, or Portugal as Oracle Global Accounting Engine. Posting Manager program

Release 12
SLA extends and replaces the Global Accounting Engine functionality used across all Oracle E-Business Suite sub ledger applications. New Create Accounting program. Oracle Financial Services Accounting Hub to create sub ledger accounting for thirdparty applications.
This allows you to take advantage of the full potential of the Oracle Sub ledger Accounting engine to generate accounting journal entries in a consistent way across your Oracle and thirdparty applications.
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SLA Features in R12 as compared to 11i

11i
Separate process to post in primary, MRC and secondary GLs MRC only for primary ledgers Different account derivation rules across modules Accounting rules defined for each operating unit No track of change in application accounting rules Cannot verify correctness of account derived prior to posting to GL Require technical / DBA support for SQLs / Workflow account generator Single representation of each transaction

Release 12
Single process to post in primary, reporting (MRC in 11i) and secondary GLs Reporting currencies can be assigned to primary and secondary ledgers Uniform account derivation rules across modules Accounting rules defined for the Chart of Accounts / GL Date tracked application accounting definitions Draft accounting to verify correctness of account derived DBA support not required for change in account derivation rules Multiple accounting representation of single transaction
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Currency in R12

11i

Release 12

1. Functional Currency

1. Accounting Currency in Primary Ledger

Functional Currency term dropped: conflicts with IAS 21 / FAS 52

2. MRC Currency

2. Reporting Currency in Primary Ledger

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Centralized Bank Model

Functionality
Bank account is now associated with LE entity rather than Operating Unit Single bank account serves multiple Operating Units Any and all Operating Units associated with a ledger can be permitted to use the bank account Centralized Credit Card Model Credit Card Encryption Supplier & Customer Banks in TCA

Business Benefits
Promote Shared Service Processing Single Payment Instruction for payments pertaining to multiple OUs in multiple currencies.

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Cash Management Centralized User Interface

11i

Release 12

Cash Mgmt Payables Receivables Payables Bank Accounts

Cash Mgmt Payables TCA Receivables Banks Payroll Bank Accounts

Payroll

Banks Accounts

Payroll

Treasury

Treasury Bank Accounts

Treasury

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Oracle Payments Replaces iPayment

Functionality
Central payment engine for E-Business Suite payments Configurable formatting framework Flexible validation model Secure payment data repository Seamless electronic payment transmission Credit card support validation, authorization and settlement PINless debit card transactions Open, extensible interfaces for integrating with other payment systems

Business Benefits
Out-of-the-box integration with leading payment processors Flexible support for various Business Payment Models Process Visibility using Dashboards. Better Working Capital Management. Payment Processing FactoryEnable Shared Service Centers. Simplified Bank Reconciliation Reduce Costs with Streamlined Processes.
Simplify Superior Ownership Experience

Process

Tech
Centralize & Global Accounting Standa rdize Data

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Oracle Advanced Global Intercompany System (AGIS)

Functionality
Enhanced Intercompany and Intracompany Balancing features Automatic creation of payables and receivables invoices for Intercompany transactions Provides interactive reconciliation reporting which allows drilldown to the details of Intercompany Account Balances so the source of discrepancies to the balances of each trading partners account balances can be found quickly. Allows Drilldown.

Business Benefits
Enables adhering statutory & corporate standards for processing Intercompany transactions Provides interactive reconciliation reporting Centralized Solution Simplified Processes

Simplify Process

Superior
Ownership Experience

AGIS
Centralize & Global Accounting Standa rdize Data

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Q&A End of Part -1

Contact Details: Srinivasa Vellanki Srinivasa.vellanki@genpact.com

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