Cost Accounting As You Want It EBS R12 Cost Accounting With SLA

Cost Accounting As You Want It
EBS R12 Cost Accounting with SLA
Douglas A. Volz Douglas Volz Consulting, Inc. OAUG Discrete MFG Cost Sub-Committee Lead
Douglas Volz Consulting, Inc. Helping clients use Oracle Applications since 1990
Agenda
Oracle Discrete Costing SLA enhancements Case example: Discrete Costing-Product Line Accounting Oracle Process Costing MAC transitioning to SLA
Oracle Discrete Costing SLA enhancements: Increased Flexibility

Release 11i account recognition pain points eliminated by Subledger Accounting (SLA): SLA removes limitations for recording COGS and Revenue (Cost Account Generator/workflow and A/R AutoAccounting are still in use) Gives you the ability to record inventory and WIP accounts with more flexibility
Oracle Discrete Costing SLA enhancements: Increased Flexibility

Flexible variance account recognition for: Invoice price and purchase variances Average cost adjustment Standard cost adjustment Manufacturing variances Account aliases Freight charges
Most other inventory, manufacturing and related account entries
Subledger Accounting Method (SLAM) Setup Steps

1. Create account derivation rules
2.
3. 4. 5.
Create journal line types

Create a journal lines definition (link the journal line type to the account derivation rule) Create an application accounting definition (copy an existing definition and modify it) Create a subledger accounting method (copy standard accrual and create a new one)
6.
Assign it to a Ledger
Key Concepts for SLA Transaction Types

Event Model: definition of the subledger transaction types and lifecycle
Entity : Classification of source of transaction Event Class: Classifies transaction types for accounting rule purposes Event Type: for each transaction type, defines possible actions with accounting significance
ENTITY Material Transaction, Receiving or WIP or Write Off
EVENT CLASS
EVENT TYPE
Logical grouping of events which have similar kind of accounting

The most granular level of business event which has accounting impact
Setup and Process

JOURNAL ENTRY SETUPS PROCESS
Enter Transaction(s) Define/copy and modify account derivation rules Cost Manager Define/copy and modify journal line types Create Accounting* Define/copy and modify descriptions Transfer Journal Entries to GL
*Run Create Accounting Cost Management concurrent request for accounting all transactions from the Cost Management SLA responsibility. Receiving Accounting can be generated in the Purchasing responsibilities using the Create Accounting Receiving concurrent request. These requests have an option to transfer the entries created to General Ledger. A separate process is also available.
Setup and Process

Accounting Configurations Transactions Subledger Journal Entries GL Journal Entries and Balances Subledger Balances Journal Entry Setup
Accounting Program Accounting Events
Cost Management
SLA
Case Example:
Discrete Costing-Product Line Accounting
Example: Purchase Price Variance product Line

Say there are two brands of cell phones, Samsung and Nokia
We want to track variances by cell phone brands
We are going to use 2 different ways to address this same requirement Cost/SLA mapping set capability (works for Discrete and Process Costing) Category Accounting R11i Cost Accounting migrated to SLA in R12.1 (only works with Discrete Costing)
Cost/SLA Mapping Set Capability
Cost SLA Mapping Set Capability: PPV by product Line
Product Line Setup Steps Using SLA mapping set

1. Enter your SLA account derivation rule for Purchase Price Variance accounts 2. Associate the new account derivation rule to your Journal Line Type
3. Associate the Application Accounting Definition with Subledger Accounting Method

Product Line Accounting Descriptive flexfield
Product Line Accounting Item Descriptive FF
Mapping set Account Derivation Rule
Mapping set Account Derivation Rule
SLA Journal Line / Derivation Rule

Associate Journal Lines Definition to the Event Class

Note the same ADR is usable for Standard Cost Update

Note the same ADR is usable for Standard Cost Update

Associate SLA Definition to the SLA Method/Ledger
Assign product line code to the inventory item
The material subledger from 11i still exists
Inventory Inventory Receiving Matl Overhead Absorption
PPV
SLA Entries That Go to Your G/L
Cost/SLA Mapping Set Capability For the Standard Cost Updates That Go to Your G/L
Category Accounting
Cost Accounting migrated to SLA in R12.1
Product Line Category Accounting
Create a new structure under the key flexfield Item Category
Create a new structure under the key flexfield Item Category Create category codes
Create a new structure under the key flexfield Item Category Create category codes Create category set

Create a new structure under the key flexfield Item Category Create category codes Create category set Assign Product Line Accounting functional area category set
Assign product line category accounts

Account Derivation Rule would have used a source directly
Summary Notes
Product line accounting can be achieved in many ways without using the Costing Hook. In R12 SLA is the Oracle R12 accounting platform and Costing supplies application sources from INV, WIP, RCV to build the accounting journals. One caveat: Pre-Release 12 subledger accounting reports are reading data from Costing distribution layer (such as the Material Account Distribution Summary or Detail Reports). Those reports will not show SLA journals. SLA provides a set of new accounting reports (such as Journal Entries Report, Accounting Analysis Report) which can be modified as desired using BI Publisher.
Discrete Inventory Period Close and Upgrade

Inventory Period Close Process
Inventory interim G/L transfer has been replaced by SLA The Inventory Accounting Period close works just like it did before, however, SLA now sends accounting information to the general ledger
Upgrade Process
Customers have option of migrating the whole historical data to SLA or choose which periods data to be migrated. Customers get option to either upgrade in downtime when upgrading or anytime after the upgrade process. Default for Cost management is to migrate the present calendar year data to SLA.
Oracle Process Costing: MAC transitioning to SLA
OPM MAC transitioning to SLA

Converged inventory model Inventory Organizations that are Process will use Process Costing
Process users are denied access to Discrete Costing forms Process Enabled organizations can not setup costs in the Discrete Costing application
Sub Ledger Architecture (SLA) replaces MAC

11i OPM
GMI
(OPM Inventory)
Purchasing
Order Management
GMD, GME
Cost Setup
Calculate Cost
Store Costs
MAC
Oracle GL

R12 OPM
Oracle Inventory
Purchasing
Order Management
GMD, GME
Cost Setup
Calculate Cost
Store Costs
SLA
Oracle GL

Subledger accounting is an intermediate step between subledger products and the Oracle General Ledger Each transaction that requires accounting is represented by a complete and balanced subledger journal entry, stored in a common data model.

11i OPM
General Ledger
Subledger
GL Export
I n t e r f a c e
Journal Import
Journal Posting
For G/L integration, discrete costing works the same as OPM costing

R12 OPM
OPM
Payables
Oracle Subledger Accounting Receivables
Oracle General Ledger
Projects
For G/L integration, discrete costing works the same as OPM costing

OPM MAC
Completed material and/or resource transactions.
SLA
Completed material and/or resource transactions.
OPM Costing Engine generates costs.
OPM Costing Engine generates costs.
Cost Pre-processor will create accounting Events OPM Subledger process processes these transactions to create Journal entries SLA accounting program processes the events to create the journal entries

OPM MAC
Fiscal Policy Event Fiscal Policy Source Event Sub-Event Account Titles Accounting Template Account Mapping Attributes Priorities and Account Mapping Test Mapping OPM Currency, OPM Ledger, OPM Exchange Rates Process Category Event Entity Event Class Journal Line Types (JLT) Application Accounting Definitions (AAD) (SLA) Sources Account Derivation Rules (ADR) Users can define their own AADs or modify seeded information SLA sources are used in ADRs More flexible. Mapping can be done at Accounting flexfield level as well as segment level
SLA
COMMENTS
Retained with few modifications Retained with few modifications
Test Accounting Builder (TAB) Use GL setups

OPM MAC
Test and Actual Subledger Accounting Subledger Program Run Subledger for multiple valuation/cost methods for a ledger
SLA
Draft and Final Accounting Accounting Pre-Processor Supports multiple valuation methods
COMMENTS
In OPM there can only be one representation at a time. SLA supports multiple representations at the same time Flexible. User can have any number of categories. Assigned to one or more event classes Is retained and has been modified to use SLA repository
Run Subledger process for a functional area
Run Pre-Processor by Process Category
Detailed Subledger Report

Most of the steps are automated using migration scripts All the Account Definitions would be migrated as ADRs Manual Steps to be completed are:
Assign Account Derivation Rules to Journal Line Definitions Validate Application Accounting Definition Assign User Subledger Accounting Method to Ledger

Update the Account Derivation Rule conditions. Ex: Add Item/Item Class/Organizations
Validate the Application Accounting Definition
Run OPM Accounting Pre-Processor Run OPM Accounting Pre-Processor
Run Create Accounting in Draft mode
Check Create Accounting report and Journal Entries report
Run Create Accounting in Final mode to create GL accounting entries

NO LOSS of functionality by moving to SLA model A new sub-menu created under Cost Management for SLA forms. Fiscal Policy and Event Fiscal Policy screens retained with minor modifications. Most of the fields will be read-only. OPM Event model mapped to SLA event model.
Acknowledgements of assistance:
Herve Yu Oracle Cost Management Development Manager Diane Struebel Schreiber Foods Cost Manager OAUG Process MFG Cost Sub-Committee Lead
Additional information available from:

R12 Oracle Subledger Accounting Implementation Guide
R12 Oracle Cost Management User Guide
R12 Oracle Process Manufacturing Cost Management - User Guide
THANK YOU
Appendix
Professional Background for Douglas Volz
Douglas Volz Consulting, Inc.

Helping clients use Oracle Applications since 1990
US Cell: +1 510 755-7050 davolz@comcast.net www.volzconsulting.com
Douglas Volz
Professional Background
Doug Volz is a Senior Architect and Advisor for Oracle Application projects, with a particular interest in Project and Cost Management. He has 30 years accumulated experience, including 5 years in Oracle Development (co-designing Oracle Cost Management) and 12 years in industry in Cost and Accounting Management positions. His Manufacturing and Cost systems experience covers project management, software design/development, delivery and consulting services, for both Oracle Corporation, and multiple international consulting firms. Prior to his systems career, Mr. Volz also held numerous management accounting positions for telecommunications, defense, and electronics companies. In his consulting roles, Doug has served over 100 clients. Many of these were multi-org, multi-currency with global footprints. Countries include US, Mexico, UK, Netherlands, Belgium, Taiwan, P.R.O.C., Norway, Japan and Germany. Doug leads the Cost Sub-Committee, for the OAUG Discrete Manufacturing Special Interest Group. He also advises and participates on the Oracle Customer Advisory Board for Fusion Costing.
Core Expertise
Multi-organization, Multi-currency ERP Implementations Project Management and Senior Project Advisor Core manufacturing processes Cost Management Inventory Bills of Material WIP Systems Integration and Data Conversions
Experience
Sample of clients served: Beckman Coulter (US) Onninen AS (Norway) Matsushita (UK, Mexico) NTL (now Virgin Media) Idec Izumi (Japan) Motorola (UK, US) Logitech (US, Taiwan, P.R.C.)
End of Presentation

Cost Accounting As You Want It EBS R12 Cost Accounting With SLA

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

Cost Accounting As You Want It EBS R12 Cost Accounting With SLA

Hochgeladen von

Copyright:

Verfügbare Formate

Cost Accounting As You Want It

EBS R12 Cost Accounting with SLA

Oracle Discrete Costing SLA enhancements: Increased Flexibility

Oracle Discrete Costing SLA enhancements: Increased Flexibility

Most other inventory, manufacturing and related account entries

Subledger Accounting Method (SLAM) Setup Steps

Create journal line types

Key Concepts for SLA Transaction Types

Logical grouping of events which have similar kind of accounting

Setup and Process

Setup and Process

Accounting Program Accounting Events

Example: Purchase Price Variance product Line

Cost/SLA Mapping Set Capability

Cost SLA Mapping Set Capability: PPV by product Line

Product Line Setup Steps Using SLA mapping set

3. Associate the Application Accounting Definition with Subledger Accounting Method

Cost/SLA Mapping Set Capability

Product Line Accounting Descriptive flexfield

Cost/SLA Mapping Set Capability

Product Line Accounting Item Descriptive FF

Cost/SLA Mapping Set Capability

Mapping set Account Derivation Rule

Cost/SLA Mapping Set Capability

Mapping set Account Derivation Rule

Cost/SLA Mapping Set Capability

SLA Journal Line / Derivation Rule

Cost/SLA Mapping Set Capability

Cost/SLA Mapping Set Capability

Cost/SLA Mapping Set Capability

Cost/SLA Mapping Set Capability

Cost/SLA Mapping Set Capability

Assign product line code to the inventory item

Cost/SLA Mapping Set Capability

The material subledger from 11i still exists

Inventory Inventory Receiving Matl Overhead Absorption

Cost/SLA Mapping Set Capability

SLA Entries That Go to Your G/L

Product Line Category Accounting

Create a new structure under the key flexfield Item Category

Product Line Category Accounting

Product Line Category Accounting

Product Line Category Accounting

Product Line Category Accounting

Assign product line category accounts

Product Line Category Accounting

Product Line Category Accounting

Discrete Inventory Period Close and Upgrade

Oracle Process Costing: MAC transitioning to SLA

OPM MAC transitioning to SLA

OPM MAC transitioning to SLA

OPM MAC transitioning to SLA

OPM MAC transitioning to SLA

OPM MAC transitioning to SLA

OPM MAC transitioning to SLA

Oracle Subledger Accounting Receivables

Oracle General Ledger

OPM MAC transitioning to SLA

OPM Costing Engine generates costs.

OPM Costing Engine generates costs.

OPM MAC transitioning to SLA

Test Accounting Builder (TAB) Use GL setups