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Overview of Oracle E Business Suite Release 12

Contents
Oracle Financials
Challenges with 11i The New Architecture of Release 12 (R12)

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R11i Areas of Improvement Modeling Entities with Sets of Books

SOBs SOB USA ($) SOB BEL () SOB ATS () SOB DM ()

Legal Entities

USA

Belgium

Austria

Germany

OUs

OU USA

OU BEL

OU ATS

OU DM

R11i Areas of Improvement (contd) Modeling Entities with Sets of Books

Pros
Each legal entity is a separate set of books Data is secure Easy to secure setup components and definitions such as FSG reports

Cons
Many books to maintain Changing responsibilities Difficult to share data and setup information Cannot perform processes across books Time-consuming open/close process Difficult reporting

R11i Areas of Improvement (contd) with Balancing Segment Values

SOBs SOB North America ($) US (01) Belgium (02) SOB Europe () Austria (03) Germany (04)

LEs (BSVs)

OUs

OU USA

OU BEL

OU ATS

OU DM

R11i Areas of Improvement (contd) with Balancing Segment Values

Pros
Fewer books to maintain No changing responsibilities Share setup information Perform processes across legal entities Easy reporting Consolidated information

Cons
Cannot share setup and data across currency boundary No data security Cannot secure definitions, such as FSG Reports and Mass Allocations No open/close security by legal entity

Getting the Legal Entity Right

Compliance falls into place
Why We Care LEs pay the taxes
Need tax registrations

LEs in Release 12 Tax

Registered companies calculate, file, and pay the transaction taxes they owe

Trade between LEs

Need intercompany

Intercompany
Do business between and across your registered companies with full legal documentation

LEs own the money and bank accounts LEs file the accounts
Takes care of accounting

Bank Model
Registered companies use their money to pay their bills, etc.

Accounting
Assign books, bookkeeping rules and currency management to your registered companies

Why Upgrade
Straight Talk from Customers
We have 60 sets of books and see tremendous inefficiencies with running processes across these sets of books. In-ability to issue one payment instruction to the bank for payments of invoices in multiple operating units. Frequent Changing of Responsibilities to access Multiple Operating Units greatly increases work load and brings about control inefficiencies. The existing Intercompany structure does not facilitate automatic reconciliation between transacting entities needing many customizations in this area. Centralization of sub ledger accounting rules would minimize set up and maintenance, providing greater financial control, and enforcing a consistent approach for true global accounting. Banks, taxes, payments, and accounting everything needs to become centralized to bring tremendous efficiencies to our organization.

R12 Ledger Architecture

Maintaining Multiple Accounting Representations with Secondary Ledgers or Reporting Currencies
A Ltd (Legal Entity)

Accounting

A Ltd (INR) (Primary Ledger) Indian GAAP

Reporting Currency (USD)

A Ltd (USD) (Secondary Ledger) US GAAP

Reporting Currency (INR)

SLA Transaction Subledger Transactions AP AR FA

SLA

Others

Key Concepts and Terminology

Primary Ledger (PL)
Main, record-keeping ledger

Secondary Ledger
Optional, additional accounting representation of Primary Ledger Can differ in one or all 4Cs:
Chart of accounts Accounting Calendar Primary Currency Accounting Conventions (i.e. Subledger Accounting Method)

Reporting Currency
Optional, currency representation of Primary or Secondary Ledger Only differs in:
Currency

Defined by 4Cs:
Chart of accounts Accounting Calendar Primary Currency Accounting Conventions (i.e. Subledger Accounting Method)

Secondary Ledger Benefits

Supports an unlimited number of additional accounting representations to meet the following reporting requirements:
Legal reporting to comply with different countries legal requirements Regulatory reporting to meet industry-specific requirements, such as the banking and insurance industry Management reporting

Updating Secondary Ledger

Level of Detail Desired
Balance Level

Path to Secondary Ledger

Use GL Consolidation to Transfer Balances Use Posting for Automatic Journals Replication Use SLA for Automatic Maintenance Manual Adjustments in GL or Automated Adjustments from SLA

Journal Level

AP AR FA

Subledger Level

Adjustments Only

Detailed Reporting Currencies

Reporting Currencies
Level of Detail Desired Path to Reporting Currency

Balance Level

Use GL Translation

Journal Level

Use GL Posting (Similar to Thin-MRC)

AP AR FA

Subledger Level

Use SLA for Automatic Maintenance (Similar to Full-MRC)

Key features.
Accounting Setup Manager
Simultaneous Accounting For Multiple Reporting Requirements Multiple Currency Support For All Data From All Sources

Management Reporting
Specify a segment to be a management segment Secure access to management segment Data Access and Data Security using Data Access Sets Access to Legal Entities, Ledgers, Balancing Segment Values and Management Segment Values Multi-Ledger (Ledger Set) Processing Overview of features that support ledger sets Definition and Setup Security Security for Setup and Definitions w/ Definition Access Sets

Centralized Set-up
Accounting Setup Manager

Define Legal Entities & Associated Rules Ensure Complete & Accurate Setup via Online Checklist Define Multiple Ledgers for Rules & Currencies One Place to manage Your Global Accounting Rules, Currencies, Ledgers, And Ledger Sets

Set Accounting Rules for All EBS Apps

Management Segment
Management Reporting and Security Management Segment
Optionally qualify a segment as the management segment to perform management reporting Secure read and write access to Ledger/Management Segment Value combinations using Data Access Sets

Co
Balancing

CC
Cost Center Management

Acct
Natural Account

I/C
Intercompany

Key features.
Accounting Setup Manager
Simultaneous Accounting For Multiple Reporting Requirements Multiple Currency Support For All Data From All Sources

Management Reporting
Specify a segment to be a management segment Secure access to management segment Data Access and Data Security using Data Access Sets Access to Legal Entities, Ledgers, Balancing Segment Values and Management Segment Values Multi-Ledger (Ledger Set) Processing Overview of features that support ledger sets Definition and Setup Security Security for Setup and Definitions w/ Definition Access Sets

Management Segment
Management Reporting and Security LE Primary Ledger
Co

Benefits
Effective Management Reporting

CC OU97 OS69 OX53

Acct

I/C

Enables management reporting and analysis by leveraging a management dimension in your chart of accounts Tighter Controls Restrict managers from accessing data outside their area of responsibility

Ledger Architecture Features

Accounting Setup Manager
Simultaneous Accounting For Multiple Reporting Requirements Multiple Currency Support For All Data From All Sources

Management Reporting
Specify a segment to be a management segment Secure access to management segment Data Access and Data Security using Data Access Sets Access to Legal Entities, Ledgers, Balancing Segment Values and Management Segment Values Multi-Ledger (Ledger Set) Processing Overview of features that support ledger sets Definition and Setup Security Security for Setup and Definitions w/ Definition Access Setssss

Simplify Data Access

Data Access Sets
Grant and tailor access to Ledgers and Balancing Segment Values (i.e. Companies, Stores, Branches, etc.)

Privileges GL Manager Taj Hotels Ledger IFRS Ledger US Gaap Ledger View Accountant Write

Data Access Set Benefits

Provides Efficient Access to Ledger Data No need to change responsibilities to access data in different ledgers Enables the Implementation of Tighter Internal Controls Prevent unauthorized viewing or updating of ledger data. i.e. users for a particular legal entity/line of business can be prevented from viewing or updating balances for another legal entity or line of bus. Especially useful if multiple legal entities share the same ledger because you can secure access to legal entity data Enables management reporting and analysis Secure data based on area of responsibility to prevent managers from viewing and updating data outside their management responsibility

Ledger Architecture Features

Accounting Setup Manager
Simultaneous Accounting For Multiple Reporting Requirements Multiple Currency Support For All Data From All Sources

Management Reporting
Specify a segment to be a management segment Secure access to management segment Data Access and Data Security using Data Access Sets Access to Legal Entities, Ledgers, Balancing Segment Values and Management Segment Values Multi-Ledger (Ledger Set) Processing Overview of features that support ledger sets Definition and Setup Security Security for Setup and Definitions w/ Definition Access Sets

Ledger Sets
Global Information At A Glance
Ledger Set Share: Chart of Accounts Calendar
Ledger C US GAAP US COA US Calendar

Ledger A French Rules Plan Comptable French Calendar

Ledger B US GAAP US COA US Calendar

USD
Ledger D US GAAP US COA US Calendar

EUR

EUR Key benefits to many Ledgers in one set

Decision-driving business information always available Simpler processing and General Ledger management Data and definitions that can be shared and secured

AUD

Reporting Currency

Ledger Sets..
Perform the Following Across Ledgers:
Open/Close Periods Create Journals Translate and Revalue Balances View Information Submit Standard Reports Submit Financial Statements

Ledger Set Benefits

Shorter Close Process Run month-end close processes across multiple ledgers simultaneously Greater flexibility to decentralize/centralize accounting functions The corporate office can control the period status for multiple subsidiaries at once Real-Time Enterprise-Wide Visibility Quickly report across the entire enterprise in real-time because no transfer of data is required Reported results are accurate and timely because they are based on the transactional system, not a data warehouse (like SAP)

Ledger Architecture Features

Accounting Setup Manager
Simultaneous Accounting For Multiple Reporting Requirements Multiple Currency Support For All Data From All Sources

Management Reporting
Specify a segment to be a management segment Secure access to management segment Data Access and Data Security using Data Access Sets Access to Legal Entities, Ledgers, Balancing Segment Values and Management Segment Values Multi-Ledger (Ledger Set) Processing Overview of features that support ledger sets Definition and Setup Security Security for Setup and Definitions w/ Definition Access Sets

Secure Definition Access

GL Manager View
Misc Expense Report Definition Balance Sheet Report Definition Income Statement Report Definition

Privileges Modify Submit

Accountant

Definition Access Sets

Definitions That Can Be Secured Accounting Calendars AutoAllocations AutoPost Criteria Sets AutoReversal Criteria Sets Budget Formulas Budget Organizations Chart of Accounts Mappings Consolidation Definitions Consolidation Sets Currency Rate Types Elimination Sets FSG Reports and components MassAllocations MassBudgets Recurring Journals Revaluations Transaction Calendars

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Other Features in R12

Is Oracle IFRS compliant? Do we have to wait for Fusion or 12.2 for IFRS features?

Our overseas customers have been complying with IFRS using our IFRS features on Release 10.7 (Emirates, Reuters back in 2000) and Release 11 for years. Our European customer base moved to IFRS on Release 11.5.9 and 11.5.10. Companies like SNCF, Michelen, Carrefour, Hilton PLC, Musgrave PLC, UBS,

Examples of IFRS Features in Release 11

Over 1 Thousand of SoBs & Ledgers migrated to IFRS overseas Features in 10.7, 11, 12: Often also serve U.S. GAAP
IAS/IFRS Statement
IAS 18 IAS 2

Compliance Issue
Revenue Recognition Inventory

Feature
AR and OM Revenue Recognition Actual & Standard Cost (Turn off LIFO?) Parent / Child Assets (components) Impairment flag & unplanned depreciation Project accounting GL and Hyperion Subledger, Journal, Balance or TB level Flexible Chart of Accounts, Hyperion business analytics

IAS 16 & others

Property, Plant & Equipment Useful Lives, Impairment Construction Translation, Remeasurement

IAS 11 IAS 21

IFRS 4

Segment Reporting

Multiple Compliance in Release 11

Balancing Segment Value
LIFO Corp Inc.
Closing Work, Adjustment from US Principles to IFRS Principles Period, Date US GAAP Results Adjust to IFRS Debit Credit Debit Credit Cash Receivables Inventory Fixed assets Depreciation Payables Accrued Expenses Taxes Capital Retained Earning Current Income Subtotal Revenue Cost of Sales R&D Expense S&M Expense G&A Expense Other income Current Income Subtotal 1,000 500,000 450,000 200,000 100,000 150,000 100,000 100,000 1,000 500,000 200,000 1,151,000 2,000,000 1,000,000 200,000 250,000 200,000 150,000 200,000 2,000,000 25,000 IFRS Results Debit Credit 1,000 500,000 475,000 200,000 100,000 150,000 100,000 100,000 1,000 500,000 225,000

Balancing Segment Value example: 99

Manual Adjustment Adjustment from subledger data Recurring Adjustment

25,000

Other R11 Multiple Compliance Tools

AX, the Accounting Engine MRC Ledgers at FX rate = 1

25,000

1,151,000

25,000 2,000,000

975,000 200,000 250,000 200,000 150,000 225,000 2,000,000

2,000,000 2,000,000

All other segments

Ledger Total

Release 12: Multiple Compliance

Ledger A IFRS Rules IFRS COA IFRS Calendar Ledger B Regulations IFRS COA IFRS Calendar

CAD

CAD

Dr

Cr

If you are in a regulated industry And the regulators remain substantially different to IFRS Or at your subsidiaries who must do regulated statutory accounting Consider using EBS Release 12 Multiple Ledgers to comply with both regulations Pros: different accounting for the same transactions Cons: Different results for the same business the reconciliation issue

Subledger Accountin g

Single subledger transaction can create multiple accounting representations (and in multiple currencies)

Payables Invoice

R12: Multiple Compliance, +Reconciliation

Ledger Set:
Secondary Ledgers, Regulated & Corp: 2 SLA rules

Base Ledger

Adjusting Ledger

Regltd

IFRS Principles IFRS COA IFRS Calendar CAD

Regulations IFRS COA IFRS Calendar CAD

or: One ledger, Adjustment segment: 1 4-line SLA Rule

Dr

Cr

Subledger Accounting

Chose to use A (full) Secondary Ledger complete alternative accounting

or
An Adjusting Ledger, (or Segment) automatic business reconciliation fewer adjusting entries easier feed to Hyperion
Payables Invoice

Designed for IFRS

404 your IFRS with the GRC Suite World class analytics in Hyperion EPM World class financial reporting in Hyperion FR Powerful professional accounting in General Ledger Simultaneous compliance with IFRS, U.S. GAAP & local regulators Industry Specific compliance with Industry Products Subledger Accounting that tracks the right information IFRS Disclosure Information on tap with reduced instance databases and worldwide processes

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Other Features in R12

A New User Experience for R12

Reduced pop-ups and duplicate
screens

Re-designed and streamlined

entire workflows

Reduced the number of steps to

complete key tasks

Improved overall look & feel and

visual style

Increased personalization
capabilities

Improved Workflow in Targeted Areas

Campaign Management Customer Support Collections & Payments Loan Management

Financial Consolidation Online Candidate Registration Absence Management Salary Administration

Self-Service Purchasing Sourcing Supplier Collaboration Business Intelligence

Subledger Accounting
Centralized Rules, Common Repository: Global Control
Centralized accounting
Transaction Systems Management Framework

Oracle Receivables

Oracle Projects

rules Predefined Validations Date effective policies Sophisticated error handling Full audit trail Bidirectional drilldowns

Information Delivery

Oracle Payables

Subledger Accounting
Detailed Journal Entries Configurable Reference
Information Consistent Balances OnOn-line inquiries

Analytics

Oracle Payroll

Regulatory Reporting

Multiple Accounting Representations

Global Compliance Statutory and Stock Market
Ledger A India GAAP India COA India Calendar Ledger B US GAAP US COA US Calendar

Multiple Ledgers

Rs

EUR

or
Dr Cr

Subledger Accountin g

Payables Invoice

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

Chose to use an alternative Ledger or just an Adjustment Ledger or segment

Increased Operational Efficiency

Centralized Accounting
View Subledger Journal Entries

Compare the parallel entries created Assign different accounting methods to different ledgers

Increased Operational Efficiency

Centralized Accounting

Multi-Org Access Control (MOAC)

Increase the efficiency of shared services and single database operations with streamlined ACCESS, processing, and reporting across operating units

India Legal Entity

Bahrain Legal Entity

USA Legal Entity Tasks  Accounting Setup  Collections  Requisition Demand & POs  Invoices & Payments  Customer Data Management  Receiving & Drop Ship

India Bahrain Operating Unit Operating Unit

USA Operating Unit

Single Responsibility

For Example:

Enter and pay invoices across OUs Receive goods across any OU Define and manage OUs from a central location View and manage customers across OUs Negotiate with suppliers for your enterprise, not just your OU

Lower Total Procure-to-Pay Costs

Oracle Payables
WHATS NEW
Pay on behalf of a different party with 3rd party payments Greater flexibility in defining and calculating discounts for quick payments

RESULTS
Streamline and automate processing

Late Charges
View Interest Invoices

Overdue invoice reference in line description

Click for details

Line Level Cash Application

Apply at transaction or detail level

Select the invoice to Apply

Click Apply in Detail for line level applications

Centralized Banking and Payments

Funds Disbursements and Capture
Bank account is now associated with LE entity rather than Operating Unit LE
OU A OU B OU C

Single bank account serves multiple Operating Units Any and all Operating Units associated with a ledger can be permitted to use the bank account

Inventory

Receivables

Projects

Plus
 Centralized Credit Card Model  Credit Card Encryption

Work in Process

Purchasing Payables

Assets

E-Business Suite

Bank Account Model

Increase Operational Efficiency

Centralized Payments
Centralized management of all disbursements Centralized management of all funds capture

Bank Account Balances and Interest

Bank Account Balances and Interest

Bank Account Transfers

Bank Statement Reconciliation Enhancements

Bank Transaction Codes can be linked to multiple sources Reconciliation tolerances
Defined at the bank account level Separate tolerances for manual and auto reconciliation Auto reconciliation tolerances further broken down by source

Reconciliation across Operating Units

Payables & Receivables Netting

Reduce Costs in Trading Relationships

AR Invoices Customer #203 #460 $500 $300 Netting AP Invoices Supplier #699 #982 $400 $400 Payment $800 Receipt $800

XML Publisher
Business Users Format and Deliver Documents
Data Sources
Oracle Applications
CRM Projects FMS HCM SCM Fund Transfers Online Paychecks Government Grant Forms XML

XML Publisher
Publishing Engine

Output Formats
PDF RTF HTML XML EDI Excel

Destination
Email Printer Fax

Templates

Letters

Order Confirmations

Any XML Data Source

Business User

Bills

Integrate Out-of-the-Box with Oracle Applications

Financial Reporting with XML Publisher

Nearly 400 Modifiable Formats in Financials Product
Assets Cash Collections Common Modules Financials Consolidation Hub General Ledger Globalizations Internal Controls Manager

Formats
22 3 15 10 21 14 92 25

Product
IT Audit Loans Payables Payments Public Sector Receivables Subledger Accounting Tax

Formats
2 6 9 120 6 10 17 23

Terminology Changes in R12

Release 11i
Sets of Books Global Accounting Engine AX Posting Sets of Books Global Intercompany System (GIS) GL Intercompany Accounts Translated Currency Multiple Reporting Currencies MRC Primary Set of Books MRC Reporting Set of Books Thin MRC Reporting Book Full MRC Reporting Book Translated Balance

Release 12
Ledgers Subledger Accounting Secondary Ledgers Advanced Global Intercompany System (AGIS) Intracompany Balancing Balance level RCs Reporting Currencies (RCs) Primary Ledger Reporting Currency Journal level RC Subledger level RC Balance Level RC