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Third Party Control Account Segment Qualifier

Use of Third Party Control Account Segment
Qualifier
Author - Venkat Srinivasan
Company – TransSys Solutions
Oracle Application Version - Applies to R12

Case Study Overview

This case study briefly discusses about,   

The basic GL setup steps required for enabling and using Third Party Control Account
feature
The purpose of this Third Party Control Account functionality
The usage of this Third Party Control Account functionality

Feature & Requirement

The Global Accounting Engine (AX) was a separate ledger in 11i but in release R12 it became an
integral part of the accounting suite. The Third Party Control Account qualifier existed but it was
blank by default on a new installation which made R12 behave same like 11i
This feature can be used to control the entry of manual journals relating to subledger control
accounts directly in General Ledger module which should otherwise come only from subledgers
(Payables and Receivables).
This feature will help in easy reconciliation of subledger control accounts balances with the
General Ledger balances

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We will learn more about Third Party Control account FEATURE in this document. Revenue’.   Reconcile – values are YES or NO Third Party Control Account – values are:  Yes  No  Customer  Supplier  Restrict Manual Journals (this was introduced in R12.Third Party Control Account Segment Qualifier Functionality Details We all know that the typical segment qualifiers are:    All Budgeting – values are YES or NO Allow Posting – values are YES or NO Account Type – values are ‘Asset’.1.3) Fig 1: Segment Qualifiers Window Page |2 . additionally two more segment qualifiers as below have been introduced. ‘Expense’ and ‘Ownership / Stockholder’s Equity Now in R12. ‘Liability’.

When such accounts are used in the subledger transaction without the third party information. This validation is performed in the manual journal entry form. Journal entries can only be created via the SLA architecture from a subledger. When do we use the value ‘Restrict Manual Journals’?  The users might sometimes want to define an account code as a Third Party Control Account to prevent the GL manual journal entries from posting to these accounts.  The Third Party Control Account feature in the Oracle E-Business Suite enables organizations to maintain detailed balances by third party for an account code combination. The control account segment qualifier lets you indicate which account segment values represent control accounts. What values to be set for the Third Party Control Account segment qualifier?  You can enter Customer or Supplier or Yes for the Third Party Control Account to designate the account as a Control Account. we can prevent the entry of manual Journals in GL. If it is not. Page |3 . Currently the only subledgers that support these accounts are: Payables and Receivables. Subledger Accounting checks that valid third party information is associated with the journal line if the account code combination is a Third Party Control Account. when the ‘Unidentified Receipts’ account code in the Oracle Receivables is defined as a Third Party Control Account. Subledger Accounting prevents the accounting for such transaction with an error that the third party information is missing.  GL will only accept a journal entry line that is entered against a third party control account if it comes from SLA.Third Party Control Account Segment Qualifier What is this third party control account and for what purpose we can use this functionality?  Third Party Control Account: Control accounts are General Ledger accounts that are accessed from subledgers (Oracle Payables and Receivables modules) for which the Global Accounting Engine automatically creates detailed balances.  Using this Third Party Control Account functionality. then Subledger Accounting rejects the journal line. Ex.  The ‘Restrict Manual Journals’ value can be used which provides validation that allows subledger accounting to complete successfully without the third party information in the subledgers but to restrict that account code while entering in the GL manual journal entries. Access to this account will be restricted to Oracle Receivables and Payables for which the Global Accounting Engine automatically creates detailed balances. accounting for the unidentified receipts will fail because no third party information is available for such receipts. Similar issues will be observed with the rounding account and intercompany accounts.

Third Party Control Account Segment Qualifier  We can use this value. when the need is to define an account code as a Third Party Control Account for the only purpose of preventing the GL manual journal entries from posting to these accounts then the user needs to select the value ‘Restrict Manual Journals’ in the list of values for the Third Party Control Account segment qualifier in the accounting flexfield segment value definition form Note: After the setting up an account code as ‘Restrict Manual Journals’ Third Party Control Account. we need to run the concurrent program ‘Inherit Segment Value Attributes’ to reflect the Third Party Control Account qualifier changes in the account code combinations. Fig 2: Segment values window Page |4 .

Third Party Control Account Segment Qualifier Fig 3: Journal Entry window i i References (MY ORACLE SUPPORT):  How to Setup The Third Party Control Account In R12 [ID 431186.1] Page |5 .1]  What Subledgers Are Supported For Third Party Control Accounts? [ID 736255.1.3 New Feature: Enhanced Third Party Control Account Validations [ID 1221605.1]  12.