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Oracle General Ledger Theory
Oracle General Ledger Theory
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2. Descriptive Flex Fields
Key Flex Fields:
General Ledger:
Accounting KFF
Reporting Attribute KFF For reporting purpose.
GL Ledger KFF It is a mirror image of Accounting KFF. It is only
for internal purpose. It is used exclusively for certain GL features
such as Mass Allocations, Recurring Journals and FSG Reports.
Receivables:
Sales Tax Location Flex Field
Territory Flex Field
Fixed
Assets:
Category KFF
Asset Location KFF
Asset key KFF
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Company
Department
Accounts
Note:
One FFQ we can use only one time.
One segment we can assign to more than one FFQ.
We can create maximum 30 segments apart from General Ledger
Segment (Total 31).
1. Balancing
Segment:
We
generally
assign
these
qualifiers
for
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But we cannot assign Management segment FFQ for the segment for
which already Intercompany, Balancing and Natural accounts FFQ are
assigned.
Compile Structure:
Currency
Calendar
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Value Set
Segment Values
Value Set:
Value set is Set of rules or properties which are going to enforce or attach to
segments.
Upon enforcing or attaching value set to the Segment, your segment will
behave or act according to the value set.
None: If validation type is none, we cannot define values for the value
set. User can enter desire value at the time of transactions entry.
Table: If validation type is table, then we can not define values but we
can use values from tables.
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List Type
Security Type
Format type
Validation Type
3 Types
3 Types
7 Types
8 Types
1. List of Values
1. No Security
1. Char
1. Dependent
2. Hierarchical
2. Date
2. Independent
3. Pop List
3. Non Hierarchical
3. Date Time
3. None
4. Number
4. Pair
5. Standard date
5. Special
6. Standard date
6. Table
time
7. Time
7. Translatable
Independent
8. Translatable
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Dependent
Currency:
Monitory currency: Functional Currency, Foreign Currency
Non Monitory currency: STAT Currency
Calendar:
Accounting Calendar: Calendar & Fiscal Calendar
Transaction Calendar
Period Type
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You can assign up to 366 accounting periods per fiscal year for any
period type, and maintain actual balances for those periods.
For example, you could define a Week period type and specify 52
periods per year.
However, for budgets you can only use the first 60 periods.
Calendar Status:
1. Open
2. Closed
3. Permanently Closed
4. Future Entry
5. Never Opened
Year Types
1. Calendar
2. Fiscal
Entry Posting
1. Never opened
2. Open
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3. Closed
4. Future
5. Permanently Closed
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Translation basically uses 2 rates: period average rate & period end
rate.
Translation uses period average rate to translate all profit and loss
account balances. (Expenses & revenue)
Translation uses period end rate to translate all balance sheet
balances. (Assets & Liabilities)
3. Suspense Account:
When ever, user is going to enter Debit without credit or credit without
debit or debit balances are not matching with credit balances, in this
case, system will automatically populate Suspense account.
Error: 6
unbalanced journal entry, suspense not allowed
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Journal Source
Freeze Journals:
To freeze the journal source, preventing users from making changes to
any un posted journals from that source, or reversing journals for Sub
ledger Accounting journal sources.
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1. Fail
2. Leave alone
3. Roll Date
Fail: Journal Import will reject transactions when the effective date is
not a valid business day. No posting takes place.
Roll Date: Journal Import will accept the transaction, but roll the
effective date back to the nearest valid business day within the same
period. If there is no prior valid business day within the same period,
the effective date is rolled forward.
Note: The Effective Date Rule field will not appear unless you have
average balance processing enabled for at least one ledger.
Journal category
Examples:
1. AP Invoices
2. AP Payments
3. Adjustment
4. Budget
5. Intercompany
6. Inventory
7. Payments
8. Payroll
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9. Receipts
10.
Enter Journals
1. manual:
1. Manual 2. Import
2. batch Journal.
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Reverse Journal
We generally reverse that journal, which got entered also got posted,
where you find there is an error in the posted entry.
Once the journal is got posted it wouldnt allow the user to make any
changes.
Switch Dr/Cr.
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BUDGETS
Budget is nothing but: better planning and controlling of the funds for future
usage.
In oracle we can define budgets up to 60 periods
There are 2 types of budgets
1. Planning budget (Revenue Budget)
2. Funding budget (Expenses Budget)
Planning Budget
This is used for only planning purpose. System will not be controlling under
this budget.
For planning budget we cannot create budget journals
Funding Budget
Under funding budget we can plan and control the expenses.
We can create budget journals in funding budget.
Setup Steps:
1. Create Reserve for encumbrance account
2. Enable:
budgetary control
Require Budgetary journals
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Assign Reserve for Encumbrance account
At Ledger level
3. Define expenditure head of accounts
4. Define Budget and open next year
Set sequence
Set password for budget
Set range for accounts
Create Budget Rules
Select funds check level
Select amount type
Balance types: 3
1. Budget
2. Actual
3. Encumbrance
Budget balances are planned amounts at initial stage.
Actual balances are paid amounts so far.
Encumbrance balances are reserved amounts for future payments.
Funds Check Level: 3
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1. Absolute
2. Advisory
3. None
If we use absolute we cannot use more than the amount what we specified.
If we use Advisory, system will give caution if we cross the amount given
If we use None, System will not give any caution, and we can enter the more
amounts also.
Amount Types: 4
1.
2.
3.
4.
One month
3 months
1 year
Depends on project beginning date
Budget Rules: 8
1.
2.
3.
4.
5.
6.
7.
8.
Divide evenly
Repeat per period
4/4/5
4/5/4
5/4/4
Prior year budget monetary
Current year budget monetary
Prior year budget STAT
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Mass Allocation
Mass allocation means:
Allocation of Revenues and cost expenses across any cost center,
department or division by using of parent values by using simple formula.
Example: Rent paid based on square feet used.
Formula:
T = A x B/C
2. Looping 3. Summing
2. Incremental Allocation
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11i Steps:
1.
2.
3.
4.
5.
6.
7.
Amount
100000
Account
-
Currency
-
C-L-C-C
STAT
C-S-C-C
STAT
C-L-C-C
INR
C-C-C-C
INR
R 12 Steps:
Step: 1
Step: 2
Step: 3
Step: 4
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Nav: Journal Enter
Step: 5
Step: 6
Types of Journals
1. Functional Currency Journal
2. Foreign Currency Journal
3. Recurring Journal
4. Tax Journal
5. Revaluation Journal
6. Suspense Journal
7. Reverse Journal
8. Mass allocation Journal
9. STAT currency Journal
10.
Budget Journal
11.
Batch Journal
12.
Manual Encumbrance Journal
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Suspense Journal
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Recurring Journal
Step:1
Line:1
Enter Expenses account (Debit Account) and the amount for Standard
Recurring Journal
Enter only Debit account for Skeleton recurring, do not enter amount
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Enter debit account & enter the formula for the amount for Formula
recurring journal
Line: 2
Step: 2
Generate the recurring journal = Click on Generate button
Say Submit
Schedule the journals for recurring.
Enter parameters
Run program.
Step: 3
Ensure Concurrent program completed Normal View Request
Step: 4
Query the recurring journal and post.
Journal Enter.
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With the above report system will generate un posted journals in GL.,
With the source: recurring.
Post the journals after review.
REVALUATION
Revaluation reflects the changes in the exchange rates.
For example:
Invoice
May 5th
$1000
Rs 45
Rs 45000
Payment
May 10th
$1000
Rs 47
Rs 47000
If paid on
May 25th
$1000
Rs 43
Rs 43000
Say Revalue
Submit request window will open
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System choose automatically program as Program Revalue
balances
Choose parameters:
Ledger
Revaluation batch
Period
Effective date
Say OK
Submit
View request
Ensure program completed normal
Tax Journal
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Steps:
1.
2.
3.
4.
Category: Expenditure
Source:
Encumbrance
Balance type:
Encumbrance
Type:
Encumbrance
TRANSLATION
Translation is used to convert the accounting balances from Functional
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2. Average rate:
Expenses & Revenues
3. Historical rate:
Ownership
Translation is part of Consolidation
We cannot run Translation for first period
Account type
Rate
Expenses
Revenue
Assets
Liabilities
Ownership / Equity
Historical rates
Setup Steps:
1. Create Cumulative Translation Adjustment account
2. Define exchange rate type
3. Define daily rates
4. Assign rate type & CTA account to ledger
5. Run Translation
6. Run Trial balance Translation report
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3. User
4. Spot
Corporate type is used for rates which are defined by the higher
management in the organization.
Market rate is at present what the rate in the market is
User rate: At the time of transaction entry user can enter applicable
exchange rates
Spot rate is a kind of market rate
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10.
TRANSLATION
Balance Level
No limit of Currencies
Off line activity
Average, Period end & historical rates
Part of consolidation
We cannot run for first period
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Auto Post
Once you define an Auto Post criteria set, run the Auto Post program
to select and post any journal batches that meet the criteria defined by
the criteria set.
You can also schedule the Auto Post program to run at specific times
and submission intervals.
You can submit the Auto Post program or schedule Auto Post runs
directly from the Auto Post Criteria Sets window. Alternatively, you can
use the Submit Request window.
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Steps:
1. Define auto post criteria
Navigation: Set up Journal Auto Post
2. Enter Journal
Navigation: Journal Enter
Enter Journal lines
Save journal
Do not post
Check to see Auto post program completed successfully
Auto Reversal
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5. Perform inquiry on account balances
SEQUENTIAL NUMBERING
Sequential numbering is used to assign unique number to the various
transactions.
System will assign serial numbers to the data flows in to General
Ledger through sub ledger accounts based on the category.
The transactions are Journals, AP Invoices, AP payments, Bank
accounts, AR invoices and AR receipts etc.
Sequencing information is available for querying and display of
journals.
You can call either sequential numbering or Document category or
voucher numbers.
SLA provides 2 different sequence mechanism for sub ledger journal entries:
1. Accounting Sequence
2. Reporting Sequence
Accounting Sequence:
The accounting sequence is assigned to sub ledger accounting journal
entries at the time that the journal entry is completed.
Reporting sequence:
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The reporting sequence is assigned to both sub ledger accounting journal
entries & General Ledger journal entries, when the General Ledger period is
closed.
This sequence is used by most of the legal reports required in some
countries, as the main sorting criteria to display the journal entries.
Reporting sequence is optional
These two sequences are not mutually exclusive, and, can coexist in
the same journal entry
Setup Steps
1. Define Sequential numbering profile option at responsibility level
Navigation: System administrator
Profile System
2. Define sequential numbering
Navigation: System administrator
Application Sequence numbering Define
4. Create Journal
Navigation: General ledger
Journals Enter
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** Automatic: System generate number after saving journal
** Manual: user has to enter number manually
** Gapless: No gap for the journals from different sources
JOURNAL APPROVAL
Journal approval is an additional security feature to post the journals using
this feature we can define approval limits for employees.
Setup steps:
1. Enable journal approval at ledger level
Navigation: General ledger
Setup Financials Accounting setup manager Accounting setup
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Navigation: System Administrator
Security User Define
Approver Methods:
1. Go up management chain
2. Go Direct
3. One Stop then go direct
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List of values are not displayed for
those combination where SR was
enabled
No error message will displayed in SR
SR restrict permission for segment
values
SECURITY RULES
Security rules are used to restrict the user from entering segment values.
It will work at responsibility level.
Step: 1
Navigation:
Set up Financials Flex fields Validation Sets
Step: 2
Navigation:
Setup Financials Flex Fields Key Security Define
Step: 4
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Navigation:
Setup Financials Flex Fields Key Security Assign
Step: 5
Navigation:
Navigation:
Setup Financials Flex Fields Key Segments
Step: 2
Navigation:
Setup Financials Flex Fields Key Rules
Step: 3
Navigation:
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System will through error message after you select the restricted code
combination
Step: 1
Navigation:
Set up Financials Definition Access sets Define
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Step: 2
Navigation:
Setup Financials Definition Access Sets Assign
Step: 3
Navigation:
Setup Financials Calendars Accounting
Query your accounting calendar
Select check box Enable Security
Say Assign Access
Choose Definition Access set
ALIASES
Aliases are used to define the short name for account code combinations
Step: 1
Define Aliases
Navigation:
Setup Financials Flex Fields Key Aliases
F11
Query your structure
Shorthand:
Select check box: Enabled
Enter Max alias size
Prompt: Short Name
Go to Alias, Descriptions tab
Enter alias name
Choose values for Template
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Go to Aliases, Effective tab
Enter from date
Save
Step: 2
Navigation:
Set up Financials Flex Fields Key Values
Step: 3
Navigation:
Journals Enter
LEDGER SET
Ledger set is used to access multiple Ledgers information from single
responsibility.
Using Ledger set we can group only Ledgers which are having same Chart of
Accounts and same Calendars.
Step: 1
Define ledger sets
Navigation: Setup Financials Ledger Sets
Enter Name and Short name
Choose:
Chart of Accounts
Calendar
Default Ledger
All other ledgers you want to group
Save.
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Step: 2
Assign Ledger set to responsibility
Navigation:
System Administrator
Profile System
Choose responsibility
Profile Option: GL: Data Access Set
Choose Ledger set
If you assign both the profile options: GL Ledger Name & GL Data Access Set
System will choose first Data Access set
Navigation:
Setup Financials Flex Fields Descriptive Segments
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Click on Segments
Enter the fields
Save
Close this window
Freeze Flex Field definition
Say Compile
Step: 2
CONSOLIDATION
Consolidation is used to consolidate the multiple subsidiary ledger
information into parent ledger.
In other words, Consolidation is used for preparation of financial reports of
parent and subsidiary companies.
If both companies are using different currencies, translation is required.
After translation data will be remain in the same books.
By using consolidation concept, we transfer data from subsidiary to Parent
SOB.
For Translation of fixed assets balances, revaluation is required.
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The difference will go to unrealized gain / loss account.
The difference of 3 rates will go to CTA Account (Cumulative Translation
adjustment account)
There are 2 types of consolidation methods:
1. Balance
2. Transaction
** Transaction method is used when we have same currency for parent and
subsidiary ledger
** Balancing method is used when we have different currency in parent and
subsidiary ledger
Consolidation Rules: 2
1. Segment Rules
2. Account Rules
Segment Rules again classified in to 3
1. Use roll up rule from
2. Use copy value from
3. Assign single value
** If codes are different:
** If codes are same:
** If structure is different
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Setup Steps:
1. Define Parent Ledger and required Subsidiary Ledgers
2. Define Parent and Subsidiary GL Responsibilities
3. Assign Ledgers to Responsibilities
4. Assign responsibilities to users
5. Define Exchange Rate type
6. Define Daily Rates
7. Complete currency translation options
8. Define consolidation mapping in the Parent ledger
9. Open periods in parent and subsidiary ledgers
10.
11.
12.
Run translation
13.
14.
Step: 7
Complete Currency translation options in parent and subsidiary ledger
Navigation:
Setup Financials ASM Accounting Setup
Query your Ledger
Go
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Update Accounting options
Click on Update of Ledger set up step
Go to Ledger Options tab
Under Currency Translation options
Choose:
Default period end rate type
Default period average rate
Cumulative Translation Adjustment Account
Say Finish
Step: 8
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Run Options:
Select check boxes
Run Journal Import
Create Summary Journals
Auto post
Click on Mapping
Enter Mapping Name and Description
Choose Target & Source Chart of Accounts
Click on Segment Rules
Choose Target Segment Values
Choose Action: Copy value from
Choose Source Segment values
Save and close this window
Choose mapping in Consolidation Definition window
Step: 10
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Choose Parent Ledger
Method: Balances
Choose Run options
Chose Consolidation mapping
Save
Step: 12
Subsidiary:
Amount type: PTD
Choose Period
Click on Query consolidation system will automatically select consolidation
mapping
Say Transfer
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Ensure program completed normal
Navigation:
Setup Financials Flex fields Key Groups
Step: 3
Navigation:
Setup Financials Flex fields Key values
Select parent Account
Go to Value, Hierarchy, Qualifiers
Group: Choose Roll up group
Save
Step: 4
Navigation:
Name:
Enter Name
Choose Ledger
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Enter Template values:
Company: D
Department: D
Account: Choose Roll up group
Sub account: D
Product: D
Say OK
Choose: Earliest period
Save
Status: Adding
Go to View Request
Ensure program completed normal
Step: 5
Navigation:
Step: 6
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Through this we will find out the account balances for working days
only
We have to setup working days and non working days through
Transaction Calendar in general ledger.
If you choose transaction calendar, system will not allow user to record
any type of transaction on non working days, and we can see the
balances on daily basis also.
Steps:
1. Set up Transaction calendar
2. Create new set of books, assign this transaction calendar to new SOB
3. At SOB Enable average balances and assign Net income account
4.
5.
6.
7.
8.
9.
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The report is consist of Rows and Columns, and is used Row set &
Column set to define rows and columns.
Steps:
1. Define row set
Navigation: Reports Define Row set
2. Define Column set
Navigation: Reports Define Column set
3. Define Report
Navigation: Reports Define Report
4. Run Report
Navigation: Reports Requests Financial
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2. Transfer data from all of your subledgers and feeder systems to the
GL_INTERFACE table.
3. Run the Journal Import process to populate the GL_JE_BATCHES,
GL_JE_HEADERS, and the GL_JE_LINES tables. This can be done automatically
from the subledger systems, or manually from Oracle General Ledger.
4. Close the period for each subledger. This prevents future subledger
transactions from being posted to General Ledger in the same period.
5. Review the imported journal entries in Oracle General Ledger. You can
review them online or in reports. Reviewing journal entries before posting
minimizes the number of corrections and changes that need to be made
after posting.
Below is a list of useful reports:
Journal Batch Summary Report
General Journal Report
Journal Entry Report
Journal Line Report
Journal Source Report
Journals by Document Number Report (when document sequencing is used)
Unposted Journals Report.
6. Post the imported journal entries. You can also schedule Autopost to pick
up and post journals transferred from subledgers on a regular basis. This
reduces the volume of posting done at month end.
8. Revalue balances to update foreign currency journals to your functional
currency equivalents.
9. Post all journal entries, including: manual and reversals.
10. Update any unpostable journal entries and then post them again.
Common reasons for unpostable batches include:
Control total violations
Posting to unopened periods
Unbalanced journal entries
11. Run General Ledger reports, such as the Trial Balance reports, Account
Analysis reports, and Journal reports.
12. Create and post adjusting entries and accruals in the adjusting period.
13. Run Trial Balance reports and other General Ledger Reports in the
adjusting period after adjustments are made.
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14. Close the last period of the fiscal year using the Open and Close Periods
window.
15. Open the first period of the new fiscal year to launch a concurrent
process to update account balances. Opening the first period of a new year
automatically closes your income statement and posts the difference to your
retained earnings account specified in the Set of Books form.
16. Run FSG reports for the last period of the year.
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