Oracle Applications R12 Subledger Accounting v1 0 PDF

Oracle Applications R12 – Subledger Accounting
Oracle Applications – Release 12

Subledger Accounting
By karthikeyan
(Karthikeyanp1981@gmail.com)
www.erpstuff.com 1/58
TABLE OF CONTENTS
Introduction
Accounting
>> Accounting in General
>> Accounting Concepts and conventions
>> Fundamental Accounting Assumptions
>> Types of Accounting Methods
>> Types of Accounts
>> Rules of Accounting
>> How journal entry is created.
>> Statutory Compliances
Subledger Accounting
>> What is Subledger Accounting
>> Need for Subledger Accounting
>> How SLA is different from the Accounting done in earlier releases?
>> Advantages of SLA in REL 12
>> New Features/Functionalities in Subledger Accounting
>> Subledger Accounting Structure
>> Modules that are covered by Subledger Accounting in Release 12
>> Types of Subledger Accounting Methods
>> Security Controls built in SLA
Reconciliatio
>> What is Reconciliation
>> Need for Reconciliation
>> Types of Reconciliation
>> Oracle suggested Reconciliation methodologies
=>Accounts Payables and General Ledger
=>Accounts Receivables and General Ledger
=>Assets and General Ledger
Functional Overview
>> New Concurrent Programs
>> New Standard Reports or Reports owned by SLA
>> New Profile Options
Technical Overview
>> Table Names
>> Accounting Packages
>> Menu
Areas which are obsolete due to introduction of SLA

>> Features
>> Programs
>> Reports
>> Profile options
>> Table Names
Accounting in Oracle Financials

>> Types of Accounts
>> Traditional Accounting Vs Oracle Accounting
Implementation Considerations
>> Role of Consultants
>> Usage of SLA Method
Patch related Information

>> Rollup Patches
>> Critical Patches
>> Diagnostic Patches
>> Other related Patches
Navigations
>> Important Navigations
Sources of Information
>> Oracle User Guide
>> Oracle Metalink Notes and White papers
Authors Corner
>> Question and Answers
>> Points to Remember
Ever since Release 12 has hit the market, there have been many talks on the architectural
changes and new functionalities; most of them who worked on release 12 environments
will have questions on the stability of this product as a whole.
There were so many misunderstandings with respect to each and every change release 12
has made from the previous releases. Few of such features were Ledgers in place of Set
of Books (General Ledger), Payment Manager in place of Payment Batches (Payables)
etc. to name few of many major changes that has take place.
Apart from changes Release 12 also contains lots of new goodies in the Kit. Few notable
new features are Multi Org Access Control, Sub Ledger Accounting, Advanced Global
Intercompany System, Data Access sets, Ledger Sets etc. Of the above, in this document
we are going to concentrate on the Sub Ledger Accounting feature
When ever a newer technology gets introduced targeting consumers through out the
world, it is practically impossible to satisfy all, the technology will only address areas
which are most common and mostly followed by the majority.
When the same comes to E business suite product, in the R12 version, research must have
been made to the areas to make the product more marketable and stronger and more
customer-friendly. Core objective of any financial ERP software is to account the
business transactions and produce financial statements and other statutory reports.
Statements and reports can be customized as per every ones requirement; however
accounting is something that needs to be done by the ERP software tool itself.
In earlier release i.e. 11i, every module has their own way of accounting, after which they
are transferred to General Ledger. On top of it, the accounting behavior in release 11 is
different based on the geography as well, since for European countries in order to match
their country requirements, a specific accounting engine was used named as Global
Accounting Engine (AX). Accounting is the key area of business, but due to the
widespread geography, a single package cannot satisfy every ones requirement with the
standard functionality.
In order to cut down the issues and requirements for different geographies, we have
localization or globalization available for country specific requirements; these normally
take care of taxation aspect and other mandatory services.
However accounting in Release 12 can be customized as per the requirement of the client
or the statutory body etc.
Since the option of altering the seeded accounting method is provided as a standard
option, which can be done from the front end, it addresses every ones concern when it
comes to accounting. But at the same time, there isn’t enough clarity or documentation
available in general to explain how it is to be done.
I have hereby made an effort to bring the basic concept of Subledger Accounting (SLA)
in a much simpler manner, so as to make a uniform level of understanding.
This document is not a replica of the user guide; it could be termed as White paper
without any restrictions, and carried out with the free flowing style of the Author.
Areas, which require understanding alone has been stated in this presentation, it does not
speak about whole of Subledger accounting in release 12.
I would only beg every one, who ever fancies to read any further make an attempt to
express their criticisms and scope of improvements on this presentation to the Author
directly, so as to consider the revisions and have the updated version time and again.
As an author, I am beginning to write this with an assumption that, readers are not
proficient in Subledger Accounting.
Accounting in General
I certainly do not want to explain the basics of accounting in this presentation, since there
is a separate presentation available in the site already. I would only request one to go
through those basics presentation if one does not have domain knowledge in Accounting.
Will cover the basics in shorter manner, so that every one who is reading the presentation
will be in same level of understanding.
Accounting is the language of business and it is used to communicate financial

information. It is the system a company uses to measure its financial performance
It helps to evaluate a Company’s past performance, present condition, and future
prospects.
Accounting is defined as the art of recording, classifying, and summarizing in a

significant manner and in terms of money, transactions and events which are, in part at
least, of a financial character and interpreting the results thereof.
Why at all accounting is required at the first place?
To know the real value of the business or the company

To know whether the business is making profit or loss
To know whether further investments or expansions can be done
To improvise further to earn more profits.
To know how much money the company needs to receive from others and how much it
needs to pay others.
And many more…
Accounting Concepts and conventions
One must know the concepts and conventions on which the accounting is based on. It is
always implied in most of the cases.
All of the below concepts and conventions apply to most of the business by default.
Conventions
Materiality – Transactions that are material to the business alone is considered, since
there could be many transactions that happen on a daily basis, however only very few are
material in nature.
Conservatism or Prudence – This is the key area, when the company follows accrual
method of accounting. To put it short, if the company knows well it advance that there is
a loss to be incurred in future, it should make provisions for it now itself. However the
same logic does not apply to profits.
Consistency – A company must be consistent in following the accounting methods and

policies every year, there should not be any abnormality. It helps in comparing the results
of the company between years.
Concepts
Separate Legal Entity – From the legal point of view, Business and the Owner are not
one and the same. There could be transactions between the Business and Owner. Even if
the owner ceases to exist, the business continues
Going Concern – It is always assumed that the company is going to continue forever in
future.
Matching Principle – Every Debit must have a matching and equal Credit.
Revenue Recognition – Revenue must not be recorded until it is earned. Unlike

expenses, which are recorded as and when it is incurred, because of its certainty.
Money Measurement – Transactions that cannot be quantified in terms of monetary

value are not eligible for Accounting.
Fundamental accounting assumptions:
Of the above mentioned concepts and conventions, the below are normally accepted
accounting assumptions on which a business is carried forward, if a company does not
follows any or all of the above, it has to mention the same in their financial statements.
- Going concern (Explained above already)

- Consistency: Company is consistent in following their accounting methods,
policies, procedures, standards in place year after year.
- Accrual: Company follows accrual method of accounting for their business.
Types of Accounting Methods
Cash Basis
The cash method recognizes revenue only when payment is received, and recognizes
expenses when cash is paid out /disbursed.
Accrual Basis
The accrual method of accounting requires that revenue be recognized and assigned to
the accounting period in which it is earned. Similarly, expenses must be recognized and
assigned to the accounting period in which they are incurred.
Types of Accounts
In any company there will be a big list of chart of accounts used to record their business
transactions, however all the accounts can be classified under the following:
The three types of accounts are:
1) Real Account – It represents assets and others that are real in nature, it can be
intangible also.
2) Personal Account – These accounts are related to a person or an organization. They

are further classified as below:
a) Natural Person – Human beings are referred here, for example Debtors or
Creditors
b) Artificial Person – It refers to companies or any other organizations which are
treated as persons under law in force
c) Representative Personal Account – It represents a single person or group of
Persons.
3) Nominal Account – These accounts represents the profits and losses
Rules of Accounting
For every item that has been classified under the types stated above, needs to follow the
governing rules.
¾ Real Account
Debit what Comes in

Credit what goes out
¾ Personal Account
Debit the Receiver

Credit the Giver
¾ Nominal Account
Debit all Expenses and Losses

Credit all Incomes and Gains
How journal entry is created.
An accountant creates a journal entry by performing the below steps:
1. Collect the details of the transaction occurred

2. Analyze the transactions and find out the accounts, which are involved in it
3. Classify the identified accounts in to the Types of Accounts
4. Apply the rules of accounting to find what needs to be debited and what needs to
be credited.
5. Present the result in the form of journal entry.
I would exhibit the above with an example for better understanding,
Company has paid Internet Broadband charges of 1000 USD by Cash
Step 1 – Transaction occurred is Payment of Expenses amounting to 1000 USD

Step 2 – Two accounts are involved here; they are Cash Account and Internet Broadband
Charges Account
Step 3 – Cash Account is a Real Account and Internet broadband is an expense account
therefore it comes under Nominal Account.
Step 4 – Application of accounting rule:
Cash Account will be credited, since as per the rule of Real Account, when ever
something goes out it must be credited.
Internet Broadband Charges Account will be debited, since as per the rule of Nominal
account, one must Debit all expenses and losses.
Step 5 – Journal Entry will be as follows:
Particulars Debit Credit
Internet Broadband Charges A/c Dr. 1000

To Cash A/c 1000
Statutory Compliances
Accounting as a process is governed by many different statute. Few are given below:
¾ Generally Accepted Accounting Principles

¾ International Accounting Standards
¾ Companies Act
¾ Sarbanes Oxley Act
¾ Other Statutory Requirements as demanded by their geography
What is Subledger Accounting?
We will herein refer Subledger Accounting as SLA.

Every one who has tried or been working on a release 12 environment would have felt
that what is this new thing, how different is it from the old one, how am I suppose to
design or alter it, what are the modules it is going to impact etc etc.
All those will be handled in this presentation under different headings. Before that we
need to have a basic understanding of what SLA is?
SLA is nothing but an engine/process/program, which is used to generate accounting

entries for the transactions entered in the Subledger modules.
SLA can be tweaked to the extent possible to make a customer accounting based on the
transaction.
Accounting being the heart of the whole business operations needs to be transparent in its
functioning, so as to trace back for problems if any. Such transparency can be achieved in
the new Subledger Accounting feature.
SLA takes care of Global Accounting requirements with better reporting features. This
feature addresses two major requirements, which is a key to any business, i.e.
Globalization and Automation.
Globalization addresses global accounting requirements and Automation takes care of
automating tasks, which were carried out manually so far.
Oracle Subledger Accounting in combination with Oracle Financial Services Accounting

Hub enables you to centralize accounting data from any third party transactional system.
SLA provides the ability to define accounting rules that derive an entire account
combination from various transaction attributes, or you can define separate rules to derive
individual segment values of an account combination, or anything in between (i.e., one
rule to derive an entire account combination and then additional rules to override one or
more of the segment values).
One must also remember that SLA is not a separate module or an application, it is a
service, which is inbuilt in every Subledger module wherever accounting is necessary.
SLA can also be termed as replacement of Global Accounting Engine used in earlier
releases with few enhancements.
Like any technology, SLA has also needs to be used correctly as directed to fetch the
desired results. The possibilities are limitless.
Need for Subledger Accounting
What could have caused oracle to give such a new feature is it really necessary to have
such a feature, where accounting is done as per the wishes and directions of the client,
instead of following a standard accounting method, which is the Best business practice?
But the fact remains that many clients were expecting this feature should have been made
available. Due to non-flexibility in alteration of Accounting rules and methods, Oracle
Financials package might have been neglected in many parts of the world. A conscious
step has been taken to improve the product and reach customers globally by providing
this SLA feature in Release 12 version. Many existing customers could have been waiting
for long time to see such a feature, whereas those who are already satisfied with the
traditional accounting functionality given by oracle may not appreciate it.
Statutory requirements, generally accepted accounting principles, Accounting Standards
etc are always subjected to change and revision, which is unstoppable and cannot be
predicted.
To match such changes, an ERP should also posses such flexibility in its performance so
as to achieve the desired result. One can say that SLA would drive more new customers
and make existing customers much happier.
How SLA is different from the Accounting done in earlier releases?
As I have stated earlier, SLA is an engine, which follows the built in rules to perform the
accounting for the transactions entered in the E business suite.
Accounting in earlier releases used to happen as decided by the standard accounting
method, which means one cannot customize the validations, rules built in the seeded
accounting method.
However in SLA one had the option to change the validations and rules of the standard
functionality and use it as per the business requirement. One can decide on the
validations and checks that need to be performed for a transaction before creating
accounting for it by writing a rule on his own which makes it very easy for every
company to follow a customized rule for satisfying their accounting requirements as per
their statute or as per company policy.
In earlier releases, every module has its own accounting method, whereas in release 12
the accounting method remains the same for all modules. Since they are now linked with
the ledgers directly, the option of selecting an accounting method for every module is no
longer available under release 12. Whereas in earlier release the Set of books was not
assigned to any particular accounting method, therefore selection of accounting method is
done at Module level.
Apart from differences, SLA in release 12 has many new features for the offering.
Advantages of SLA in REL 12
The following were the few advantages of SLA:
It provides a good base for better Internal Control.

It acts as a container of various accounting treatments
Accounting system can be made flexible by avoiding expensive customizations.
Accurate accounting helps in reduction of reconciliation issues during the period
end close process.
Straight through processing allows real-time, single step posting to all relevant
ledgers (primary, secondary and reporting ledgers).
Accounting errors can be avoided to a greater extent with the help of draft
accounting feature.
Oracle Subledger Accounting informs you of outstanding transactions in any of
the Subledger for the period you are trying to close.
It provides transparency in Accounting.
New Features/Functionalities in Subledger Accounting
One may think, the concept of SLA itself is new, therefore it would have been much
better to term it as Features in Subledger Accounting, but what I was referring was new
features in SLA, which were not available in the earlier releases.
I would highlight few features here, since the more I start to write about everything else,
readers will get a feel of reading the user guide, therefore I am cutting short wherever
necessary.
Few notable features are:
¾ Multiple Accounting Representations
In earlier releases one were able to make the transactions represented in a

different currency by usage of reporting currency and report set of books
functionality, the same concept has been extended to the level of accounting in
release 12 under Subledger accounting.
Combination of ledger and Subledger Accounting method put together is termed
as an Accounting Representation. SLA provides the option to the user where user
can know how the transaction would have got accounted if he uses a different
accounting method other than his current accounting method.
This is possible with the help of Secondary ledgers, where every transaction
posted or created in the primary ledger on accounting method number 1 will be
replicated in the secondary ledger on accounting method number 2.
With introduction of SLA and Ledgers (Secondary), one can have more that one
type of accounting created for a transaction and get it saved in a different ledger,
thus a company can maintain different secondary ledgers for different
requirements.
¾ Multi Period Accounting
This feature enables the system to perform accounting at different periods for a
single transaction. One can perform the accounting for more than one period
based on their setups.
Ideal example would be lump sum payment for an contract work, which needs to
apportioned to every period and accounted or Rent paid for whole year as single
transaction, however while accounting it is split and absorbed on every period
individually.
¾ Copying an Existing Application Accounting Definition
When the client has a requirement, which is not, satisfied by the seeded Subledger
accounting method, he has to define new accounting definitions to suit his
business needs. It would time consuming to create an Accounting definition from
scratch, instead of which one can copy the existing accounting definition and
make changes wherever it is required to meet the business needs.
Also since the seeded Subledger Accounting methods owned by oracle cannot be
modified, one has to make a copy of the Subledger accounting method to make
changes.
¾ Real Time /Online /Straight Through Accounting
A transaction can be accounted and transferred to General Ledger in no time,

which makes the balances up-to-date. Any time the user makes a query to find out
the balances, it will be up-to-date.
¾ Audit Trail
The rules and validations are clearly visible from the front end, which provides a
clear trail on every action performed with respect to accounting, satisfying audit
purposes.
¾ Date Effective Application Accounting Definitions
As stated earlier, the accounting methods and standards time and again are
subjected to revisions and changes, keeping that in mind, we have the option of
specifying the date ranges for the accounting definitions.
¾ Draft Accounting
It also provides a preview of accounting before making it final, which will avoid
many accounting mistakes.
¾ Manual Subledger Journal Entries
It has been a long running practice that whenever some wrong accounting
happens at Subledger level, for corrections, users will pass a manual journal entry
in the General ledger, so as to have correct balance before consolidation.
Logically, this was an acceptable practice, however procedural point of view it is
not acceptable, since due to entries in General Ledger, the Subledger will never
reconcile with the General Ledger.
SLA has provided the option of passing a manual entry at the Subledger level
itself, without intervention of general ledger.
One can create a manual journal entry at Subledger level instead of performing
the same at General Ledger level.
¾ Replacement for Disabled Accounts
Due to business requirements one might have disabled few particular account
code combinations from daily usage. However when there is a data transfer
happens between modules, the interface program may reject the data from
transferring due to disabled accounts. SLA provides the feature of having
replacement accounts for accounts, which are disabled in the system.
And many more…
Subledger Accounting Structure
The below diagram depicts how the Subledger Accounting is structured in release 12.
LEDGER
SUBLEDGER ACCOUNTING METHOD
APPLICATION ACCOUNTING
DEFINITION
JOURNAL LINE DEFINITION
JOURNAL LINE ACCOUNT DERIVATION JOURNAL ENTRY

TYPE RULES DESCRIPTIONS
SOURCES
TRANSACTION OBJECT
When you observe the Sub ledger accounting structure diagram given above, it is easy to
follow it from top-down approach, whereas when we actually define it in the system we
will be following Bottom-up approach.
So I will explain in the order Bottom to Top, so that it will be easier to correlate when
you are actually make a setup.
The order in which a Subledger accounting method is setup is as follows:
• Define Journal Line Types

• Define Journal Entry Descriptions
• Define Mapping Sets
• Define Account Derivation Rules
• Define Journal Line Definitions
• Define Application Accounting Definition
• Define Sub Ledger Accounting Method
• Define Ledger
Now we will see in brief about the above-mentioned steps.
Journal Line Type – Journal line types specify if the journal line is to be a Credit / Debit
/ Gain or loss line
Journal Entry Description – You can define the description, which appears in
Subledger journal header and line. Multi-language support is available for journal entry
descriptions.
Mapping Sets – It is used to associate a specific output value for an Accounting

Flexfields or segment. Since it is optional it did not figure in the structure.
Account Derivation Rules – Used for determining the accounts to be used for the
Subledger journal entries.
Journal Line Definitions – Linking Journal line type with Account derivation rule.
Supporting References – It is used for providing additional information about a

Subledger journal entry. It is an optional setup.
Application Accounting Definition – Used for assigning journal line definitions and
header descriptions to event classes and event types. It is driven by the process of
Accounting Methods Builder.
Subledger Accounting Method – Application accounting definitions can be grouped in

to a Subledger accounting method.
Ledgers – Create a ledger by assigning a Subledger accounting method to it and start

entering transactions.
Apart from above there are many more terminologies which we will be using frequently
in our discussion, will explain those terminologies as and when they appear.
Modules that are covered by Subledger Accounting in Release 12
Assets Cash Management Costing
Federal Financials Globalizations Intercompany
Lease Management Loans Payables
Payroll
Projects Property Manager
Process Manufacturing Public Sector Receivables
Of all the above modules, the 4 modules, which are highlighted, were the most frequently
used financial modules, and our discussion will be limited to these 4 modules only.
Types of Subledger Accounting Methods
By default there are five seeded sub ledger accounting methods that are provided by
oracle. One can make use of any of these methods to carry on with their implementation.
One must remember that apart from the seeded method; creation of new Sub Ledger
Accounting method as per their requirement is also possible.
The available Subledger Accounting Methods are:
1) Accrual with Encumbrance Accounting

2) Cash with Encumbrance Accounting
3) Standard Accrual
4) Standard Cash
5) US Federal Accounting
Now lets see basis of Selection of Accounting methods:

All upgraded, non-public-sector ledgers will have a Subledger accounting method
assigned called Standard Accrual or Standard Cash (This is nothing but the same Cash
and Accrual which we had in Release 11)
All upgraded public sector ledgers will have a Subledger accounting method assigned
called Encumbrance Accrual or Encumbrance Cash. (This comes in to place when we use
purchasing modules, and transfer of encumbrance journals becomes necessary)
For Federal customers, all upgraded ledgers will have the US Federal Accounting
Subledger accounting method assigned.
Security Controls built in SLA
¾ One cannot access the Subledger accounting rules and definitions of another
module from his current module.
¾ Subledger Accounting methods owned by oracle can never be altered
¾ Any changes made to a Subledger Accounting setup demands the SLA method to
be validated, in order to make sure the setup changes done by the user is of logical
in nature.
RECONCILIATION
What is Reconciliation
Reconciliation is a process of comparing or cross checking the data between two different
sources. At Subledger level if a transaction becomes accounted, then it becomes eligible
for transferring to General Ledger module. After transferring the accounted data from
Subledger to General Ledger, one has to reconcile whether the data transfer is complete
and accurate
Need for Reconciliation
Common Reconciliation worries
Every company, which has implemented an ERP, will be under constant pressure during
the period end process and reconciling their Sub Ledger balances with the General
Ledger.
Let us see why we will have differences between Sub Ledgers and General Ledgers in
first place. There could be many reasons for it, we will discuss on the few which happens
frequently:
Instead of transferring all Entries from Sub Ledgers to General Ledgers,
there will be Entries, which are posted directly in General ledger manually
without taking the route of Sub Ledgers.
While closing the period, whenever any dispute arises, without solving the
same, sweeping it across the next period and just passing some adjustment
entries in general ledger to match that effect.
The golden rule is that “Never enter any transactions in General Ledger that affects your
Sub Ledger”. But in reality that is not the case, instead of arguing whether it is correct or
not to follow such practice, we must agree that it is not practically possible always to
route every transaction from Subledger.
In order to solve such differences in reconciliation we need to have control measures to
basic aspects, which is:
Prevent Entering Transactions in to General Ledger manually which is
related to Sub Ledger
Always transfer all Transactions from Sub Ledger to General Ledger
Now how to achieve this target?
By defining proper Segment qualifiers for a Natural Accounting segment. Many would
be aware of the available Segment qualifiers, for those who don’t have an idea they are:
Allow Budgeting
Allow Posting
Account
Control Account (Termed as Third Party Control Account in Release 12)
Reconciliation Flag
Many would normally neglect the Control Account or Third Party Control Account
segment qualifier. Accounts having this qualifier as “yes” will never allow manual entries
to be created in General Ledger. All entries for a Control Account must come from a Sub
Ledger only. Additionally, this feature supports tracking and reporting on control
accounts for trading partners, so you can track receivables balance by customer, or
payables balance by supplier. This way one can prevent posting entries directly in to
General Ledger for accounts that are affecting Sub Ledgers.
Now that we have blocked entries going to General Ledgers directly, we have to make
sure all entries that are created in Sub Ledger have to be transferred to General Ledger.
There are many ways in which an entry can be accounted in the Sub Ledger and
transferred to General Ledger. We will discuss those ways later. The point to be noted is
that one can transfer entries from Subledger to Journal ledger at any point of time, at a
month end, on completion of every transaction, while performing create accounting
operation or separate transfer to GL etc.
Few Instances as to how reconciliation worries are reduced in Release 12:
SLA helps in carrying out accurate accounting through the accounting rules
Straight through processing helps real time and single step posting to ledgers
Option to Verify the Accounting before posting has been given to avoid wrong
entries with introduction of draft accounting feature.
During transfer to GL operation, if any Account has been disabled, one can use
the replacement account to carry out the transfer process successfully.
Automatic prompting of outstanding transactions happens during the period close
By maintaining a full link between the transaction and accounting data, Subledger
Accounting allows powerful reconciliation and auditing capabilities
.
Types of Reconciliation
Before dealing with the suggested steps of reconciliation between modules, one has to
know the methods of reconciliation that are available. They are Internal Reconciliation
and External Reconciliation.
Internal Reconciliation is a process of cross checking within a Subledger
External Reconciliation is a process of cross checking between General Ledger and
Subledgers.
In order to perform the reconciliation process, there are many standard reports available
and oracle has suggested steps on how to perform these reconciliation’s. Oracle
suggested reconciliation steps are:
Oracle suggested Reconciliation methodologies
Comparison between:
Accounts Payables and General Ledger
Internal Reconciliation
Particulars Report to be Run
Previous Month Trial Balance Open Account AP Balances Listing
Add Current Month Posted Invoices Payables Posted Invoice Register
Less Current Month Posted Payments Payables Posted Payment Register
Current Month Trial Balance Open Account AP Balances Listing
Any differences must be captured by the below reports:
9 Period Close Exceptions Report

9 Unaccounted Transactions Report
External Reconciliation
General Ledger Accounts Payable
Account Analysis(132 or 180) Report = Account Analysis Report
AND
Liability account balance from ‘Trial

= Open Account AP Balances Listing
Balance’ report
Accounts Receivables and General Ledger
Internal Reconciliation
Sign Particulars Accounting Report Related Transaction Report

Beginning Balance Not Applicable Aging report by Account
+ Transactions Accounting Sales Journal by Account Transaction Register
Data
+/- Adjustments Accounting Adjustments Journal Adjustment Register
Data
- Invoice Exceptions Not Applicable Invoice Exception Report
_ Unapplied Receipts Unapplied Receipts Unapplied and Unresolved
Accounting Data Journal Receipts Register
_ Applied Receipts Applied Receipts Journal Applied Receipts Register
Accounting Data
+/- Credit Memo Gain / Loss On Account Credit Not Applicable
Memo Gain and Loss
Journal
= Ending Balance Not Applicable Aging report by Account
Also run ‘AR Reconciliation report’ to find out the differences between transactional data and

accounting data.
AR to GL Reconciliation Report
Assets and General Ledger
Use the Unposted Journals Report in Oracle General Ledger, to match GL batch totals
with the asset batch totals found in the Subledger Accounting Account Analysis report.
New Concurrent Programs
¾ Accounting Event Extract Diagnostics

¾ Accounting Program
¾ Compile Application Accounting Definition (OLD)
¾ Complete Multiperiod Accounting
¾ Create Accounting
¾ Create Accounting for Third party Merge
¾ Create Reporting Sequence Number
¾ Create and Assign Sources
¾ Download Application Accounting Definitions
¾ Export Application Accounting Definitions
¾ Import Application Accounting Definitions
¾ Open Account balances Data Manager
¾ Open Account balances Data Manager Worker Process
¾ Parent Accounting Program
¾ Purge Transaction Objects Diagnostics
¾ Re-sequence of accounting sequence number
¾ SLA Pre-upgrade Program
¾ Subledger Accounting Balances Update
¾ Transaction account builder - Generate API objects
¾ Transaction account builder - Validate transaction accounting definitions
¾ Transaction Objects Diagnostics
¾ Transfer Journal Entries to GL
¾ Update Scheduler Accounting Options
¾ Update Historical Subledger Transactions
¾ Upload Application Accounting Definitions
¾ Validate Application Accounting Definitions
Of the above the below mentioned program is more important which is why have
explained in detail for better understanding:
Create Accounting in Release 12
Briefly, Create Accounting program is used to carry out accounting for transactions that
are recorded in the sub ledgers based on the accounting rules that are mentioned in the
Sub Ledger Accounting Method.
You may think that we also had this create accounting functionality in Release 11 under
Payables Application. Yes we did had this in Release 11 itself, but it was limited only to
Payables module and not to the other modules, now in release 12 this functionality is
extended to all sub ledger applications along with some enhanced features.
Now lets see what are those enhanced features that got in to Create Accounting Program.
In Release 11, when you create accounting for transactions, it will be done immediately,
you did not have the option of previewing before accounting. This led us to lot of
reconciliation worries in month end, since some manual entries get passed in General
Ledger.
Unlike previous versions, Release 12 has provided the user with three new functionalities
under Create Accounting Program. They are:
1) DRAFT Mode (Draft Accounting) - It is nothing but a draft accounting which will
help the user to know what are the Accounts that are getting used for this particular
accounting event. You can correct your transaction by looking at the draft entries. Draft
entries will also be included in Accounting reports, but it cannot be transferred to General
Ledger since it does not reserve funds and does not update balances. An entry is draft
status can be Updated and Deleted.
2) FINAL Mode (Online Accounting) - It is normal online accounting functionality

which we had in earlier release also. It means that entries creating using this mode cannot
be changed. After performing this accounting, transaction becomes eligible to get
transferred it to General Ledger any time.
3) FINAL POST Mode (Straight through Accounting) - It is a very useful new feature,
which does the operation of Straight through accounting. When you select this particular
feature, it Creates Accounting for the Transaction with the mode Final , it Transfer the
accounting entries to General Ledger and it also posts those entries in General Ledger.
With the help of new enhancements in Create Accounting feature, transactions and
balances can be up to date and reconciliation is made easy.
New Standard Reports or Reports owned by SLA
¾ Account Analysis Report

¾ Journal Lines Report
¾ Open Account AP balances listing
¾ Open Account Balances Listing
¾ Open Period Balances
¾ Subledger Multi period Accounting and Accrual reversal report
¾ Subledger period close exceptions report
¾ Third party balances report
¾ Trading Partner summary Report
Of the above the below mentioned report is more important which is why have explained
in detail for better understanding:
Open Account AP balances listing
This report replaces the Account Payable Trial Balance report which was used in
Released 11i. Now in Release 12, one needs to run this report in order to get the trial
balance information. The report has undergone many changes which resulted in new
setups and new parameters. The output of this particular report purely depends on how
the setup of Report Definition is done and also while running the report what account
code combination is provided as the liability account.
The report format will be published in pdf format with new look.
It is advised not to enable the AP Trial Balance report from system administrator and
reuse it in Release 12, instead please use the Open Account AP balance listing report.
New Profile Options
¾ SLA: Accounting Methods Builder Context

¾ SLA: Additional Data Access Set
¾ SLA: Allow Reports Journal Source Override
¾ SLA: Disable Journal Import
¾ SLA: Display Timestamp on Trace
¾ SLA: Enable Data Access Set Security in Subledger
¾ SLA: Enable PL/SQL Profiler
¾ SLA: Enable SQL Trace
¾ SLA: Enable SRS Log/Output
¾ SLA: Enable Subledger Transaction Security in GL
¾ SLA: Enable Trace
¾ SLA: Flush Trace File
¾ SLA: INITIAL DATE FOR HISTORICAL UPGRADE
¾ SLA: Oracle Forms Trace Mode
¾ SLA: SRS Trace Mode
¾ SLA: Setup User Mode (INTERNAL use only, do not ship)
¾ SLA: Trace File Override Directory
¾ SLA: Trace File Override Filename
¾ SLA: Trace Level
¾ SLA: Trace Timeout
Of the above the below profile option is more important which is why have explained in
detail for better understanding:
SLA: Disable Journal Import
In earlier versions (11x), whenever there is a transfer of entries made from Subledger to
General ledger, it used to happen through in steps, as stated below:
Step 1 - Run Transfer to GL program from Subledger

Step 2 - Data will be transferred from Subledger to GL interface table
Step 3 - Run Journal import from General Ledger which will import the journals from
GL interface table to GL base tables.
Step 4 - Query the batches and then post the journals imported.
In Release 12, most of the above-mentioned steps remain the same, apart from STEP 2.
That is, by default, when you run the Transfer to GL program, it also performs the
Automatic Journal import program along with it, which results in no data lying in GL
Interface Program.
The reason why the interface tables are populated before hitting the base tables are to
make corrections or rollback the mistakes. All necessary corrections are carried out in
interface tables and only the CORRECT data is sent to General Ledger. Due to this new
standard feature, one cannot see any data in the interface table, because data does not stay
in interface table.
By setting the profile option "SLA: Disable Journal Import" to YES, we are directing the
system not to perform the journal import automatically. So the journal import has to be
triggerred Manually, which means the data will stay in the interface table.
The default value for the profile option SLA: Disable Journal Import is NO, which means
when ever a data is sent to General ledger , the Subledger tables alone are used (i.e. tables
with prefix XLA).
The "SLA: Disable Journal Import" is not updateable at User, Responsibility and
Application level. It can be updated only at SITE level.
When the journal import fails and the profile option SLA: Disable Journal Import was set
to NO, the data will not stay in the GL interface tables, the data will be rolled back to the
Subledger tables.
The structure of R12 is designed such a way to avoid or reduce the reconciliation worries.
When you set this profile option to YES, and make corrections if any and then transfer
the DATA to GL, the data available in GL and data available in Subledger becomes OUT
OF SYNC.
So, below are oracle recommendations about this profile option:
1) By default the value of this profile option is NO

2) If user has AP/AR , but not oracle GL, they should set SLA: Disable Journal
Import=Yes
3) If user has AP/ AR as well as oracle GL, they should set this profile to No to ensure
the data in SLA and GL are in sync
4) If the profile options stays at the default value from the start of the implementation ,
please DO NOT change it.
Table Names
Few important tables that are used in Subledger Accounting requiring some attention:
XLA_SUBLEDGERS
The XLA_SUBLEDGERS stores information that depend on the application. It includes

a row for each application, standard or not, supported by XLA
XLA_SOURCES_B
The XLA_SOURCES_B table stores all sub-ledgers sources and sources customized by
user. These sources are used to create accounting rules and conditions
XLA_EVENT_SOURCES
The XLA_EVENT_SOURCES table stores all sources assigned to an event class or an

event entity.
XLA_CONDITIONS
The XLA_CONDITIONS table stores the conditions for an accounting line or header
types, segment rules and descriptions.
XLA_ACCTG_METHOD_RULES
The XLA_ACCTG_METHODS_RULES table stores the assignments for all Application

Accounting Definitions (AAD) within each Subledger Accounting Method.
XLA_EVENTS
This table performs the operations performed by AP_ACCOUNTING_EVENTS table in

earlier releases. In earlier release in order to find whether an accounting event is
processed completely or not, we can find out by the ‘Status’ column, whereas in release
12, the table went through few changes, now the status of Event Status and Process Status
determines whether the event is accounted or not.
XLA_AE_HEADERS
Once the Accounting events generated in the XLA_EVENTS are processed then it will
generate the header level information of the accounting entry, under which the
accounting entry will be published.
XLA_AE_LINES
For the corresponding header, the accounting entry lines are stored in this table. When
you perform view accounting the entry displayed in the screen is purely based on the data
saved in this table.
XLA_ACCOUNTING_ERRORS
The XLA_ACCOUNTING_ERRORS table stores the errors encountered during

execution of the Accounting Program along with the description. The error saved in this
table is displayed in the Create Accounting Program output file.
XLA_DISTRIBUTION_LINKS
The XLA_DISTRIBUTION_LINKS table stores the link between transactions and

Subledger journal entry lines
ACCOUNTING PACKAGES
Of the many accounting packages that are delivered with every critical patch related to
Subledger accounting, sharing few important packages and its purpose.
SNO PACKAGE PACKAGE BODY NAME PACKAGE DESCRIPTION

1 xlajejex.pkb XLA_AE_JOURNAL_ENTRY_PKG XLA Accounting Engine APIs
2 xlajelns.pkb XLA_AE_LINES_PKG XLA Accounting Engine APIs
3 xlajebal.pkb XLA_JE_VALIDATION_PKG Public API for handling balancing
of Subledger Journal Entries
4 xlaapeng.pkb XLA_ACCOUNTING_PKG Package body for the Accounting
Program
5 xlatbapt.pkb XLA_TB_AP_REPORT_PVT XLA Trial Balance Report
Package for AP
6 xlabacom.pkb XLA_BALANCES_PKG XLA Balances Package
7 xlaevevp.pkb XLA_EVENTS_PUB_PKG It contains all the APIs required
for processing accounting events.
MENU
The Menu of Subledger Accounting is embedded in every Subledger module; since it

does not have a module of its own.
The complete Subledger Accounting setup menu is saved under menu name
‘XLA_ACCOUNTING_SETUP’
This menu is accessible only from Subledger and not available from General ledger
module.
Even among the Subledger, each Subledger application has the menu seeded in it, with its
application name. That is one cannot make the changes of Payables Subledger
Accounting definition from receivables responsibility.
The below Screen Shot displays what was referred in:

Switch Responsibility to Receivables
Navigate to Setup > Accounting > Accounting Methods Builder > Methods and
Definitions > Application Accounting Definitions
In the above screen shot, you can observe that the Application field has the value
Receivables, which is hard, coded and cannot be changed. The value is determined based
on the responsibility from which it is accessed.
Below are the names of the menu/submenu/functions available under Subledger

accounting menu.
MENU SUBMENU FUNCTION
NAVIGATION MENU/SUBMENU/FUNCTION
>Subledger Applications SLA: Subledger Accounting Setups
>> Accounting Methods Builder SLA: Accounting Methods Builder
>>> Events SLA: Events
>>>> Event Model SLA: Event Model
>>>> Process Categories SLA: Process Categories
>>>> Accounting Event Class Options SLA: Accounting Event Class Options
>>> Sources SLA: Sources
>>>> Sources SLA: Sources
>>>> Source Assignments SLA: Source Assignments
>>>> Accounting Attribute Assignments SLA: Accounting Attribute Assignments
>>>> Custom Sources SLA: Custom Sources
>>> Journal Entry Steps SLA: Journal Entry Setups
>>>> Journal Line Types SLA: Journal Line Types
>>>> Journal Entry Description SLA: Journal Entry Descriptions
>>>> Mapping Sets SLA: Mapping Sets
>>>> Accounting Derivation Rules SLA: Account Derivation Rules
>>>> Supporting References SLA: Search Supporting References
>>> Methods and Definitions SLA: Methods and Definitions
>>>> Journal Line Definitions SLA: Journal Lines Definitions
>>>> Application Accounting Definitions SLA: Application Accounting Definitions
>>>> Subledger Accounting Methods SLA: Subledger Accounting Methods
>>> Application Accounting Definition SLA: Application Accounting Definitions
Loader Loader
>>>> History SLA: Application Accounting Definitions
History
>>>> Merge Analysis SLA: Merge Analysis
>>> Accounting Definitions Inquiry SLA: Account Methods Builder Inquiry
>> Post - Accounting Programs SLA: Post-Accounting Programs
>> Open Account Balances Listing Definitions SLA: Open Account Balances Listing
Definitions
>> Transaction Account Builder SLA: Transaction Account Builder
>>> Transaction Account Types SLA: Transaction Account Types
>>> Transaction Account Definitions SLA: Transaction Account Definitions
>> Transaction Accounting Builder Setup SLA: Transaction Account Builder Setup
>>> Subledger Application SLA: Subledger Application
>>> Transaction Account Builder SLA: Transaction Account Builder
>>>> Transaction Account Types SLA: Transaction Account Types
>>>> Transaction Account Definitions SLA: Transaction Account Definitions
>>> Sources Setup SLA: Sources for Transaction Account Builder
>>>> Sources SLA: Sources
>>>> Custom Sources SLA: Custom Sources
>>> Mapping Sets SLA: Mapping Sets
>>> Account Derivation Rules SLA: Account Derivation Rules
FEATURES
¾ Global Accounting Engine

Replaced by the ‘Subledger Accounting’ feature
PROGRAMS
¾ Payables Transfer to General Ledger (APGLTRANS)

Replaced by the program ‘Transfer Journal Entries to GL’
¾ Payables Accounting Process (APACCENG)

Replaced by the program ‘Create Accounting’
¾ Create Journal Entries (FAPOST) process
Replaced by the program ‘Create Accounting’
REPORTS
¾ Payables Accounting Entries Report (APAEREP)

Replaced by the report ‘Journal Entries Report’
¾ Payables Account Analysis Report (APXAAREP)

Replaced by the report ‘Account Analysis Report’
¾ Accounts Payable Trial Balance (APXTRBAL)

Replaced by the report ‘Open Account Balances Listing’ and ‘Open Account
AP Balances Listing’
PROFILE OPTIONS
¾ SLA: Debug Dbms Trace

¾ SLA: Debug Trace
¾ SLA: Debug SQL trace
¾ SLA: Debug SRS Enable log/output
¾ SLA: Debug System Statistics
¾ SLA: Debug Trace DateTime
TABLE NAMES
¾ AP_ACCOUNTING_EVENTS_ALL
Replaced by the table XLA_EVENTS
¾ AP_AE_HEADERS_ALL
Replaced by the table XLA_AE_HEADERS_ALL
¾ AP_AE_LINES_ALL
Replaced by the table XLA_AE_LINES_ALL
TYPES OF ACCOUNTS IN ORACLE APPLICATIONS
Oracle Applications comprises of many individual modules, among those General Ledger
acts as a central repository and responsible for the accounting performed by the system.
Since only in General ledger one defines the chart of accounts and sets the accounting
method and accounting types for recording the business transaction.
In General ledger under Accounting Flexfield, for the segment, which has the flexfield
qualifier, has ‘Natural Account’ will have the segment qualifier called Account Type.
Below are the values, which are seeded by the system; one has to map the entire chart of
accounts in to these 5 types of accounts.
1) Asset 2) Liability 3) Ownership/Stockholder's Equity 4) Expense 5) Revenue
(Have excluded Budgetary (CR) and Budgetary (DR) from the seeded account types)
TRADITIONAL ACCOUNTING VS ORACLE ACCOUNTING
S No Traditional Accounting Accounting in Oracle Applications

1 Every Account is named according to its Every Account is identified by the complete code
nature in text format. combination, which is a collection of values from
E.g.: Telephone Expenses A/C, different segments on a Flexfields.
Maintenance A/C E.g.: 01-000-1110-0000-000 represents Cash A/C
2 Generating Financial reports are difficult, Generation of complex MIS reports are done at
since the during data collection stage, only ease, since during data entry the information
minimal information is collected. collected are in detail, which helps the system in
furnishing reports of any nature in no time.
3 Usage of Dummy or useless accounts is Due to the System setup and integration between
not done. many modules, in order have smooth integration,
few accounts are used to act as a bridge between
modules, which are termed as Clearing Accounts.
They normally don’t carry any balance, used only
for system needs.
4 One can find for every journal entry Due to the usage of clearing accounts, there will
created, there will be a supporting be many transfer entries, clearing entries,
transaction or a documentation available generated by the system, which need not have a
transaction behind it. In short there will be
additional generation of entries in oracle
environment.
5 Chances of incorrect or wrong accounting System will prevent the user from proceeding or
due to human nature. entering the wrong information. Security features
are built in such a way that system will accept
only correct and complete information for
processing.
6 They are more flexible since accounting is It is not flexible since the details required by the
either done manual or recorded in a system and the way it is designed has to be
customized package with less validations. adapted by the end users.
Role of Consultants
Functional consultants who are normally familiar with the front-end forms may find it bit
difficult to carry out the setups relating to the Sub Ledger Accounting Method. However
they are responsible for putting the client accounting requirements in to Sub ledger
accounting rules. It would require basic programming knowledge, which helps in
thinking logically as to how the system would perform. Services of a Technical
Consultant can be used at discretion.
Normally there tends to be a GAP between the requirements collected by a functional
consultant and the end product delivered by a technical consultant, since both of them are
different in their thinking process. (Some times or often this leads to blaming each other)
However Release 12 made the process of defining a Sub Ledger Accounting in a user-
friendly manner, which enables the Functional Consultant to carry out the complete
operation. Even though bit of programming knowledge will make thinks easier, but
nothing really mandates the need of a Technical Consultant.
(After the introduction of Release 12 i guess Functional consultants worked on this new
release are deserved to be known as Techno Functional Consultants!)
Usage of SLA Method
Always advised to use the copy of the seeded SLA method, since if any changes are
required in future it can be altered and validated for usage. If you use oracle owned SLA
method, you cannot make any changes to it.
Rollup Patches
Oracle Applications Release 12 has made out many rollup patches as of date. The more
and more the rollup patches gets released one can infer the following:
¾ More problems are discovered in the product, which means product is not stable
¾ Changes to the product are done to meet the requirements of customers at large.
¾ One can apply these patches so as to avoid many errors, which have been
identified.
Rollup patches are not mandatory, at the discretion of the customer it can be applied or
not. However it is advised to be on the latest version.
Following are the roll up patches released so far:
Rollup Patch Patch Number Related Metalink

Number Note
RUP 2 6048111 427410.1
RUP 3 6272715 454385.1
RUP 4 6510214 465284.1
RUP 5 6836355 577440.1
RUP 6 6728000 557869.1
Critical Patches
Critical patches are a group of fixes which are very vital for the system to perform in an
intended way. It is mandatory for any customer to apply this patch before reporting a
problem to Oracle for getting the support. Time and again at frequent intervals oracle
comes up with critical patch updates for every product.
Since this presentation is related to accounting i have listed patches, which takes care of
many accounting related issues.
Patch Number Patch Description

6826219 R12 : SLA CRITICAL ROLLUP AS OF FEB 19, 2008
7113955 R12 : SLA CRITICAL ROLLUP AS OF MAY 19, 2008
7379106 R12 Subledger Accounting Critical Patches September 2008
7456652 EBS: R12 Payables Critical Patch Collection November 2008
7387254 EBS: R12 Receivables Critical Patch Collection November 2008
Note: 742558.1 EBS: R12 Assets Critical Patches September 2008
Note: 742330.1 EBS: R12 General Ledger Critical Patches September 2008
Diagnostic Patches
Oracle product by default provides many diagnostics tool for different modules, which
helps one to find out the issue and work towards the cause of the issue. Time and again,
these diagnostics are corrected and made more efficient to track the issue, these changes
come via patches. Listed details of few diagnostics patches:
Patch Number Metalink Note Patch Description

6265820 357241.1 E-Business Suite Diagnostics 12.0.3 Release Update
Pack (Diagnostics RUP3)
Other related Patches

Patch Number Patch Description
6901404 CONSOLIDATED ACCOUNTING RELATED CHANGES
Important Navigations
Being a new setup area, it will take time to get used to the new navigations that are
provided for Subledger setups. Its only by practice everything attains its perfection.
However in order to make things easier at the early stages I am providing you with details
as to how the menu is designed and seeded in to every Subledger module. Every menu
and submenu is inter-related.
Subledger Accounting Setup
Subledger Applications
>> Accounting Methods Builder
>>> Events
>>>> Event Model
>>>> Process Categories
>>>> Accounting Event Class Options
>>> Sources
>>>> Sources
>>>> Source Assignments
>>>> Accounting Attribute Assignments
>>>> Custom Sources
>>> Journal Entry Steps
>>>> Journal Line Types
>>>> Journal Entry Description
>>>> Mapping Sets
>>>> Accounting Derivation Rules
>>>> Supporting References
>>> Methods and Definitions
>>>> Journal Line Definitions
>>>> Application Accounting Definitions
>>>> Subledger Accounting Methods
>>> Application Accounting Definition Loader
>>>> History
>>>> Merge Analysis
>>> Accounting Definitions Inquiry
>> Post - Accounting Programs
>> Open Account Balances Listing Definitions
>> Transaction Account Builder
>>> Transaction Account Types
>>> Transaction Account Definitions
>> Transaction Accounting Builder Setup
>>> Subledger Application
>>> Transaction Account Builder
>>>> Transaction Account Types
>>>> Transaction Account Definitions
>>> Sources Setup
>>>> Sources
>>>> Custom Sources
>>> Mapping Sets
>>> Account Derivation Rules
>> - Menu
>>> - Submenu
>>>> - Function
Oracle User Guide

Oracle releases documentation (Technical and Functional) as manuals, user guides etc,
they are available in the oracle site, downloadable at free of cost. User guides tells you
about the intended functionality and architecture on which it is built. Depends on the
complexity of the product, some may have implementation guide, user guide and
reference guide as well.
Follow the below instructions as to how to download/ View the user guides from the site:
Step 1 - Visit http://www.oracle.com/technology/index.html

Step 2 - Navigate to Oracle Technology Network (OTN) >> Documentation >>
Applications >> click of EBS Documentation R12+
Step 3 - The Oracle R12 Documentation Library page is displayed.
Step 4 - Select the Documentation tab
Step 5 - Search for the documentation for your product.
For Technical related information,

that is information related to tables, packages, etc can be obtained from Technical
Reference Manuals. However for referring this details one needs to hold an Metalink
login. Follow the below steps on how to view the eTRM’s:
Step 1 – Login to https://metalink.oracle.com

Step 2 – Click on “Knowledge” Tab
Step 3 – In the left side, that is under Knowledge Browser, Scroll down to the ‘Online
Documentation’ section
Step 4 – Click Applications Electronic Technical Reference Manuals (eTRM)
Oracle Metalink Notes and White papers
Metalink Notes
Metalink Note Note Description

414100.1 How to derive debug information for Subledger Accounting Issues
456706.1 Oracle Subledger Accounting Release 12 Known Issues
579373.1 R12 Accounting, GL Transfer, Period Close and Trial Balance 'How
To' documents
579836.1 R12 Accounting FAQ's
601306.1 R12 Accounting Errors Encountered FAQs
602615.1 How to Locate the Latest R12 Product-Specific Information using New
Metalink Features
729296.1 SLA: Accounting Data Missing from the SLA Tables
732928.1 R12 Troubleshooting Accounting Issues
White Papers
Metalink Note Note Description

434226.1 Release 12 (R12) - Impact of Subledger Accounting (SLA) on General
Ledger (Drilldown and Journal Import)
578313.1 Subledger Accounting in Oracle Assets
Questions and Answers

Is SUBLEDGER ACCOUNTING a different Module?
No, it is not a separate module; it does not have a separate responsibility for the users to
login. Subledger Accounting Method menus are clubbed together with the respective
Subledger modules wherever applicable.
Every Module, which is covered by a Subledger accounting method, will have Subledger
accounting method menu in it. One cannot make a setup for one module from different
module, i.e. one cannot make a change on the Subledger setup of payables module from
receivables module. Since Subledger menu available in each module are specific to the
setups in that module only.
Is it mandatory to define a Subledger accounting method during Release 12

implementation?
One must understand that every fresh installation of oracle apps comes with 5 seeded
accounting methods stated earlier, which are sufficient enough to meet the generic
requirements of the client and business. However due to different statutory requirements
through out the world and different nature of businesses, accounting requirements varies
between client to client. In those circumstances alone, based on the clients requirement
one can define their own Subledger accounting method
What will happen if I made alterations to the existing seeded Subledger accounting
methods?
You cannot make alterations to the seeded Subledger accounting methods provided by
oracle. In any Subledger form whenever you see ORACLE name under the owner field it
means that, those setups are owned by ORACLE, which cannot be altered.
If I want to make very few changes to the existing Subledger accounting method seeded
by oracle, since it meets 99% of my business requirement apart from minor changes, and
I don’t want to create a new Subledger method from scratch in order to meet the few
unique requirements, what can be done?
In such a case oracle provides you with an option of copying a seeded Subledger
accounting method and make alterations in the copy and use it as a Subledger method for
your business. So that you need not perform all the setups required for a Subledger
method.
While creating a Subledger accounting method, I have created few conditions,

which are illogical, but the system hasn’t stopped me from proceeding. Does oracle
checks each and every setup created for a new Subledger accounting method at
every stage?
Oracle allows you to create only logical setups in a Subledger accounting method, even
though the validations are not performed at each and every stage, after performing all the
setups required for a Subledger accounting method , you must validate the Subledger
accounting method as a whole in order to make it available for usage. At that time system
will prevent you from proceeding with all illogical combinations.
I have made a change in my Subledger accounting which was working fine

previously, but after making changes, it is not performing any accounting operation
at all, why is that?
Whenever you make any change to any part of Subledger accounting method, saving
those changes alone is not enough, you need to validate it again only then the changes
made will come in to effect. Whenever you face any such errors please always check the
Subledger accounting method form, whether the validate button is enabled or disabled. If
it is enabled means, the Subledger accounting method requires validation, if it is disabled,
then it does not allow you to validate further, since it is already validated.
Due to the recent changes in statute, my accounting method needs to be changed

with immediate effect, should I implement a new ledger with new accounting
method to proceed further?
No need for that. You can change your Subledger accounting method from the
Accounting Setup Manager screen itself. The new transactions, which are going to be
entered, will be accounted as per the new accounting method attached.
For what ledgers one can setup Subledger accounting options?
For Primary and Secondary ledgers
How has to one link the accounting method to the Subledger module used, is there a
profile option?
All subledgers assigned to a ledger inherit the Subledger Accounting method assigned for
that ledger.
I need to stop all accounting related operations to one of my Subledgers, will that be
possible?
Yes, you can disable the Subledger accounting for a particular application, however it is
available only for secondary ledgers. Subledger Accounting will generate no entries if the
application is in disabled status.
I have created a new SLA method, which is used for all subledgers. In future if I
need to upgrade to higher version, does the new patches or codes affect my SLA
method created? Will I be required to recreate it again?
Definitions created by users are not overwritten by upgrades to Subledger Accounting.

However upgrades can still affect definitions if your Subledger Accounting method uses
the seeded components.
What are Transaction Chart of Accounts and Accounting Chart of Accounts?
For recording of transactions one will use the Transaction Chart of Accounts and for
generating journal entries one will use the Accounting Chart of Accounts.
The usage or the distinction means more only when the user implements Secondary
ledgers in his setups, if the user does not have secondary ledgers, then for his primary
ledger the transaction and accounting chart of accounts remains one and the same.
In case of Secondary ledgers how the system correlates between Transaction chart
of accounts and Accounting Chart of Accounts?
One has to perform Chart of Accounts Mapping between Transaction and Accounting
chart of accounts.
POINTS TO REMEMBER
9 One can never be able to alter an seeded accounting method i.e. accounting
method owned by oracle, we can only take a copy of the seeded accounting
method and change the validations and insert rules, where ever it is appropriate.
9 Subledger accounting method created by Oracle cannot be modified or deleted.
9 Subledger accounting does not interfere with Auto Accounting or Workflow

Account Generator for account generation, which continues to perform the same
operations as it was in earlier versions.
9 One cannot define an illogical or impossible accounting rule since it allows you to
define, test and validate accounting rules; therefore, journal entries generated by
SLA have very little risk of error.
9 If you want to make changes to the standard seeded Subledger accounting

method, then you can make a copy of the available Subledger accounting and
make the necessary changes you wanted in it.
9 Whenever you make alteration to any rules to any of the components in Subledger
accounting, you need to validate your SLA method again, only then you can use
it, else it will throw an error.
9 The transaction and accounting charts of accounts are always the same for the
primary ledger.
9 The Subledger Accounting option is visible only for secondary ledgers in the
ledger options view described in Subledger Accounting Options Setup Pages.
9 Subledger Accounting will generate no entries for an application if Subledger

Accounting is disabled for the ledger.
9 Use Primary Ledger Amount field is only displayed for a secondary ledger if the
corresponding Subledger application has been enabled for Valuation Method.
If you have successfully made to the LAST PAGE
Send your feedback to admin@erpstuff.com

Oracle Applications R12 Subledger Accounting v1 0 PDF

Hochgeladen von

Dokumentinformationen

Originalbeschreibung:

Originaltitel

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

Oracle Applications R12 Subledger Accounting v1 0 PDF

Hochgeladen von

Copyright:

Verfügbare Formate

Oracle Applications R12 – Subledger Accounting

Oracle Applications – Release 12

Areas which are obsolete due to introduction of SLA

Accounting in Oracle Financials

Patch related Information

Accounting is the language of business and it is used to communicate financial

Accounting is defined as the art of recording, classifying, and summarizing in a

Why at all accounting is required at the first place?

To know the real value of the business or the company

Accounting Concepts and conventions

Consistency – A company must be consistent in following the accounting methods and

Revenue Recognition – Revenue must not be recorded until it is earned. Unlike

Money Measurement – Transactions that cannot be quantified in terms of monetary

Fundamental accounting assumptions:

- Going concern (Explained above already)

Types of Accounting Methods

The three types of accounts are:

2) Personal Account – These accounts are related to a person or an organization. They

3) Nominal Account – These accounts represents the profits and losses

Debit what Comes in

Debit the Receiver

Debit all Expenses and Losses

How journal entry is created.

An accountant creates a journal entry by performing the below steps:

1. Collect the details of the transaction occurred

I would exhibit the above with an example for better understanding,

Company has paid Internet Broadband charges of 1000 USD by Cash

Step 1 – Transaction occurred is Payment of Expenses amounting to 1000 USD

Particulars Debit Credit

Internet Broadband Charges A/c Dr. 1000

¾ Generally Accepted Accounting Principles

What is Subledger Accounting?

We will herein refer Subledger Accounting as SLA.

SLA is nothing but an engine/process/program, which is used to generate accounting

Oracle Subledger Accounting in combination with Oracle Financial Services Accounting

Need for Subledger Accounting

How SLA is different from the Accounting done in earlier releases?

Advantages of SLA in REL 12

The following were the few advantages of SLA:

 It provides a good base for better Internal Control.

New Features/Functionalities in Subledger Accounting

Few notable features are:

¾ Multiple Accounting Representations

In earlier releases one were able to make the transactions represented in a

¾ Multi Period Accounting

¾ Copying an Existing Application Accounting Definition

¾ Real Time /Online /Straight Through Accounting

A transaction can be accounted and transferred to General Ledger in no time,

¾ Date Effective Application Accounting Definitions

¾ Manual Subledger Journal Entries

¾ Replacement for Disabled Accounts

And many more…

Subledger Accounting Structure

SUBLEDGER ACCOUNTING METHOD

JOURNAL LINE DEFINITION

JOURNAL LINE ACCOUNT DERIVATION JOURNAL ENTRY

The order in which a Subledger accounting method is setup is as follows:

• Define Journal Line Types

Now we will see in brief about the above-mentioned steps.

Mapping Sets – It is used to associate a specific output value for an Accounting

Supporting References – It is used for providing additional information about a

Subledger Accounting Method – Application accounting definitions can be grouped in

It provides a good base for better Internal Control.