Professional Documents
Culture Documents
GL Theory
GL Theory
1
R12 = GL THEORY
General Ledger:
Accounting KFF
Reporting Attribute KFF For reporting purpose.
GL Ledger KFF It is a mirror image of Accounting KFF. It is only
for internal purpose. It is used exclusively for certain GL features
such as Mass Allocations, Recurring Journals and FSG Reports.
Receivables:
Sales Tax Location Flex Field
Territory Flex Field
Fixed Assets:
Category KFF
Asset Location KFF
Asset key KFF
2
R12 = GL THEORY
Note:
One FFQ we can use only one time.
One segment we can assign to more than one FFQ.
We can create maximum 30 segments apart from General Ledger
Segment (Total 31).
MSQ is used in Data Access set for allowing privileges to user other
than balancing segment values.
3
R12 = GL THEORY
But we cannot assign Management segment FFQ for the segment for
which already Intercompany, Balancing and Natural accounts FFQ are
assigned.
Compile Structure:
4 Cs
Chart of Accounts (Structure, Segments & Segment values)
Currency
Calendar
4
R12 = GL THEORY
Value Set
Structure and Segments
Segment Values
Value Set:
Value set is Set of rules or properties which are going to enforce or attach to
segments.
Upon enforcing or attaching value set to the Segment, your segment will
behave or act according to the value set.
5
R12 = GL THEORY
4. Number 4. Pair
time
7. Time 7. Translatable
Independent
8. Translatable
6
R12 = GL THEORY
Dependent
Currency:
Calendar:
Accounting Calendar: Calendar & Fiscal Calendar
Transaction Calendar
Period Type
7
R12 = GL THEORY
Calendar Status:
1. Open
2. Closed
3. Permanently Closed
4. Future Entry
5. Never Opened
Year Types
1. Calendar
2. Fiscal
3. Closed X X
4. Future X
5. Permanently Closed X X
Note:
From the above Retained Earnings account is mandatory to create primary
ledger. Remaining 5 accounts are optionally mandatory based on the
requirement.
1. Retained Earnings:
Retained earnings are accumulated profits. Whereas net income means
current year profits
9
R12 = GL THEORY
Translation basically uses 2 rates: period average rate & period end
rate.
Translation uses period average rate to translate all profit and loss
account balances. (Expenses & revenue)
Translation uses period end rate to translate all balance sheet
balances. (Assets & Liabilities)
3. Suspense Account:
When ever, user is going to enter Debit without credit or credit without
debit or debit balances are not matching with credit balances, in this
case, system will automatically populate Suspense account.
Error: 6 unbalanced journal entry, suspense not allowed
Spot:
An exchange rate which you enter to perform conversion based on the rate
on a specific date. It applies to the immediate delivery of a currency.
Corporate:
This rate is generally a standard market rate determined by senior financial
management for use throughout the organization.
User (Reporting):
An exchange rate you specify when you enter a foreign currency journal
entry.
10
R12 = GL THEORY
Journal Source
Freeze Journals:
To freeze the journal source, preventing users from making changes to
any un posted journals from that source, or reversing journals for Sub
ledger Accounting journal sources.
11
R12 = GL THEORY
1. Fail
2. Leave alone
3. Roll Date
Fail: Journal Import will reject transactions when the effective date is
not a valid business day. No posting takes place.
Leave Alone: Journal import will accept all transactions regardless of
the effective date.
Roll Date: Journal Import will accept the transaction, but roll the
effective date back to the nearest valid business day within the same
period. If there is no prior valid business day within the same period,
the effective date is rolled forward.
Note: The Effective Date Rule field will not appear unless you have
average balance processing enabled for at least one ledger.
Journal category
12
R12 = GL THEORY
9. Receipts
10. Year end close.
Enter Journals
13
R12 = GL THEORY
Reverse Journal
We generally reverse that journal, which got entered also got posted,
where you find there is an error in the posted entry.
Once the journal is got posted it wouldnt allow the user to make any
changes.
The only solution or remedy is to reverse the journal.
In order to reverse the journal, first review the journal, use reverse
button available in the journal window, also indicate the period where
the reversal entry should get created.
Navigation: Journal Entry
Once we reverse the journal system will create one un posted journal,
showing the earlier debit balance to credit side & earlier credit balance
to debit side.
Post this un posted journal.
After the journal reversal the particular account in the journal will
show the balance Zero.
Reverse is of two types:
Change sign (Profile option is required)
Switch Dr/Cr.
14
R12 = GL THEORY
BUDGETS
Budget is nothing but: better planning and controlling of the funds for future
usage.
In oracle we can define budgets up to 60 periods
There are 2 types of budgets
1. Planning budget (Revenue Budget)
Planning Budget
This is used for only planning purpose. System will not be controlling under
this budget.
For planning budget we cannot create budget journals
Funding Budget
Under funding budget we can plan and control the expenses.
We can create budget journals in funding budget.
Setup Steps:
1. Create Reserve for encumbrance account
2. Enable:
budgetary control
15
R12 = GL THEORY
At Ledger level
Set sequence
Set password for budget
Set range for accounts
Create Budget Rules
Select funds check level
Select amount type
Balance types: 3
1. Budget
2. Actual
3. Encumbrance
16
R12 = GL THEORY
1. Absolute
2. Advisory
3. None
If we use absolute we cannot use more than the amount what we specified.
If we use Advisory, system will give caution if we cross the amount given
If we use None, System will not give any caution, and we can enter the more
amounts also.
Amount Types: 4
Budget Rules: 8
1. Divide evenly
2. Repeat per period
3. 4/4/5
4. 4/5/4
5. 5/4/4
6. Prior year budget monetary
7. Current year budget monetary
8. Prior year budget STAT
17
R12 = GL THEORY
Mass Allocation
Formula: T = A x B/C
A = Cost pool Amount
B = Usage factor
C = Total Usage
T = Target Account
O = Off set account
18
R12 = GL THEORY
11i Steps:
1. Define STAT Currency
2. Create SFT account
3. Create STAT journal with SFT account
4. Set up parent department and set up parent & child relation
5. Prepare mass allocation formula
6. Run mass allocation
7. Review and post journal
R 12 Steps:
Step: 1 Create Usage factor account and Cost pool account
Nav: Setup Financials Flex fields key Values
19
R12 = GL THEORY
Types of Journals
20
R12 = GL THEORY
Suspense Journal
21
R12 = GL THEORY
Recurring Journal
Line:1
Enter Expenses account (Debit Account) and the amount for Standard
Recurring Journal
Enter only Debit account for Skeleton recurring, do not enter amount
22
R12 = GL THEORY
Enter debit account & enter the formula for the amount for Formula
recurring journal
Line: 2
Enter the credit account
We can enter 9999 lines in a recurring journal. In which 9998 lines are
for debit lines and only one line is for credit line. We call this line as
offset account line. Hence we have to enter line 2 as a offset line and
key in the number 9999 in line 2.
Do not enter amount for line 2. System will add all the debit lines
amount and consider the credit amount as offset account.
If you wish to enter more credit lines, we have to give negative sign
for the lines, for example -9998, -9997 etc.
Step: 2
Generate the recurring journal = Click on Generate button
Say Submit
Schedule the journals for recurring.
Enter parameters
Run program.
Step: 3
Ensure Concurrent program completed Normal View Request
Step: 4
Query the recurring journal and post. Journal Enter.
23
R12 = GL THEORY
With the above report system will generate un posted journals in GL.,
With the source: recurring.
Post the journals after review.
REVALUATION
Revaluation reflects the changes in the exchange rates.
For example:
Invoice May 5th $1000 Rs 45 Rs 45000
Payment May 10th $1000 Rs 47 Rs 47000
If paid on May 25th $1000 Rs 43 Rs 43000
In the above example gain or loss is Rs 2000
Setup Steps:
1. Define un realized gain or loss accounts
3. Define daily rates for the date of journal entry (USD INR)
6. Run revaluation
Say Revalue
24
R12 = GL THEORY
Choose parameters:
Ledger
Revaluation batch
Period
Effective date
Say OK
Submit
View request
Ensure program completed normal
Tax Journal
25
R12 = GL THEORY
Steps:
Category: Expenditure
Source: Encumbrance
Balance type: Encumbrance
Type: Encumbrance
TRANSLATION
26
R12 = GL THEORY
Setup Steps:
1. Create Cumulative Translation Adjustment account
5. Run Translation
2. Marketing
27
R12 = GL THEORY
3. User
4. Spot
Corporate type is used for rates which are defined by the higher
management in the organization.
Market rate is at present what the rate in the market is
User rate: At the time of transaction entry user can enter applicable
exchange rates
Spot rate is a kind of market rate
Setup Steps:
1. Define rounding difference account
28
R12 = GL THEORY
MRC TRANSLATION
29
R12 = GL THEORY
Auto Post
30
R12 = GL THEORY
Steps:
1. Define auto post criteria
Navigation: Set up Journal Auto Post
2. Enter Journal
Navigation: Journal Enter
Enter Journal lines
Save journal
Do not post
Check to see Auto post program completed successfully
Auto Reversal
If you routinely generate and post large numbers of journal reversals as part
of your month end closing and opening procedures, you can save time and
reduce entry errors by using Automatic Journal Reversal to automatically
generate and post your journal reversals.
31
R12 = GL THEORY
Choose:
Category
Method: Switch Dr / Cr
Reverse period
Reversal date
32
R12 = GL THEORY
SEQUENTIAL NUMBERING
Sequential numbering is used to assign unique number to the various
transactions.
System will assign serial numbers to the data flows in to General
Ledger through sub ledger accounts based on the category.
SLA provides 2 different sequence mechanism for sub ledger journal entries:
1. Accounting Sequence
2. Reporting Sequence
Accounting Sequence:
The accounting sequence is assigned to sub ledger accounting journal
entries at the time that the journal entry is completed.
Reporting sequence:
33
R12 = GL THEORY
These two sequences are not mutually exclusive, and, can coexist in
the same journal entry
Setup Steps
1. Define Sequential numbering profile option at responsibility level
4. Create Journal
34
R12 = GL THEORY
JOURNAL APPROVAL
Setup steps:
35
R12 = GL THEORY
Approver Methods:
1. Go up management chain
2. Go Direct
3. One Stop then go direct
36
R12 = GL THEORY
List of values are not displayed for All list of values are displayed, but
those combination where SR was we will get error message for invalid
enabled code combination
No error message will displayed in SR Error message will displayed in CVR
SR restrict permission for segment CVR restrict user for invalid code
values combination
SECURITY RULES
Security rules are used to restrict the user from entering segment values.
It will work at responsibility level.
Navigation:
Set up Financials Flex fields Validation Sets
Navigation:
Setup Financials Flex Fields Key Security Define
37
R12 = GL THEORY
Navigation:
Setup Financials Flex Fields Key Security Assign
If you try to enter restricted segment value, system will through error
message
Navigation:
Setup Financials Flex Fields Key Segments
Navigation:
Setup Financials Flex Fields Key Rules
38
R12 = GL THEORY
System will through error message after you select the restricted code
combination
DAS is used to provide access in 3 ways to the users for various definitions:
1. Use
2. View
3. Modify
Navigation:
Set up Financials Definition Access sets Define
39
R12 = GL THEORY
Navigation:
Setup Financials Definition Access Sets Assign
Navigation:
Setup Financials Calendars Accounting
ALIASES
Aliases are used to define the short name for account code combinations
Navigation:
Setup Financials Flex Fields Key Aliases
F11
Query your structure
Shorthand:
Select check box: Enabled
Enter Max alias size
Prompt: Short Name
40
R12 = GL THEORY
Save
Navigation:
Set up Financials Flex Fields Key Values
LEDGER SET
Ledger set is used to access multiple Ledgers information from single
responsibility.
Using Ledger set we can group only Ledgers which are having same Chart of
Accounts and same Calendars.
Calendar
Default Ledger
Save.
41
R12 = GL THEORY
Choose responsibility
Profile Option: GL: Data Access Set
Choose Ledger set
If you assign both the profile options: GL Ledger Name & GL Data Access Set
System will choose first Data Access set
Navigation:
Setup Financials Flex Fields Descriptive Segments
42
R12 = GL THEORY
Click on Segments
Enter the fields
Save
Close this window
Freeze Flex Field definition
Say Compile
New Journal
Enter Journal as usual
Click on DFF check box to enter DFF fields
CONSOLIDATION
Consolidation is used to consolidate the multiple subsidiary ledger
information into parent ledger.
43
R12 = GL THEORY
2. Transaction
** Transaction method is used when we have same currency for parent and
subsidiary ledger
Consolidation Rules: 2
1. Segment Rules
2. Account Rules
44
R12 = GL THEORY
Setup Steps:
14. Query the Consolidation journals in the Parent Ledger and post
Step: 7
45
R12 = GL THEORY
Say Finish
Consolidation Attributes:
Choose Parent Ledger
Currency: INR
Method: Balances
Usage: Standard
46
R12 = GL THEORY
Run Options:
Select check boxes
Run Journal Import
Auto post
Click on Mapping
47
R12 = GL THEORY
Subsidiary:
Amount type: PTD
Choose Period
Click on Query consolidation system will automatically select consolidation
mapping
Say Transfer
48
R12 = GL THEORY
49
R12 = GL THEORY
Say OK
Save
Status: Adding
Go to View Request
Ensure program completed normal
50
R12 = GL THEORY
Through this we will find out the account balances for working days
only
We have to setup working days and non working days through
Transaction Calendar in general ledger.
If you choose transaction calendar, system will not allow user to record
any type of transaction on non working days, and we can see the
balances on daily basis also.
Steps:
51
R12 = GL THEORY
The report is consist of Rows and Columns, and is used Row set &
Column set to define rows and columns.
Steps:
3. Define Report
Navigation: Reports Define Report
4. Run Report
Navigation: Reports Requests Financial
Note: The first period of the new fiscal year should not be opened until all of
the yearend processing for the last period of the current year has
completed.
52
R12 = GL THEORY
2. Transfer data from all of your subledgers and feeder systems to the
GL_INTERFACE table.
4. Close the period for each subledger. This prevents future subledger
transactions from being posted to General Ledger in the same period.
5. Review the imported journal entries in Oracle General Ledger. You can
review them online or in reports. Reviewing journal entries before posting
minimizes the number of corrections and changes that need to be made
after posting.
Below is a list of useful reports:
Journal Batch Summary Report
General Journal Report
Journal Entry Report
Journal Line Report
Journal Source Report
Journals by Document Number Report (when document sequencing is used)
Unposted Journals Report.
6. Post the imported journal entries. You can also schedule Autopost to pick
up and post journals transferred from subledgers on a regular basis. This
reduces the volume of posting done at month end.
10. Update any unpostable journal entries and then post them again.
Common reasons for unpostable batches include:
Control total violations
Posting to unopened periods
Unbalanced journal entries
11. Run General Ledger reports, such as the Trial Balance reports, Account
Analysis reports, and Journal reports.
12. Create and post adjusting entries and accruals in the adjusting period.
13. Run Trial Balance reports and other General Ledger Reports in the
adjusting period after adjustments are made.
53
R12 = GL THEORY
14. Close the last period of the fiscal year using the Open and Close Periods
window.
15. Open the first period of the new fiscal year to launch a concurrent
process to update account balances. Opening the first period of a new year
automatically closes your income statement and posts the difference to your
retained earnings account specified in the Set of Books form.
16. Run FSG reports for the last period of the year.
54