1. What is journal, how many types of journal?

Journals it is used to record the business transaction it contains debit and credit lines
always debit must be equal to credit. Types of journals are Suspense Journal or Unbalanced
Journal, Recurring Journals and Reversal journals.

2. P2P Process & O2C Process

A. P2P process start with

Requisitions RFQQuotations’AnalysisPOReceivingInvoicesPayment.

B. O2C processing four high-level processes i.e. Order, Invoices, Recognize the COGS and
Cash Receipt.

Sales orderBook OderRelease the OrderConfirm the OrderClose the OrderImport

InvoicePrint the InvoiceRevenue RecognitionDefer the Cost of Goods enter
ReceiptApply the Receipt.

3. What is Translations & Revaluation and which level its working?

Translation: It is used to translate functional currency balances into foreign currency

balances at the account level
Revaluation: It is used identify the unrealized gain or loss .which is occurring on the
currency fluctuation.

Example:
On 01-Dec-2009
-Functional Currency is USD
-Foreign Currency is INR.
-Conversion Rate is 2.
-Created invoice for 100 INR, validated and accounted. Not Paid.

As per the above journal lines on 01-Dec-2009, customer is liable to pay 200 USD to the
supplier.

-End of the period, conversion rate has been changed to 2.5.

-So customer's liability will get increased to 250 USD(100*2.5).
-So customer suppose to pay 250 USD instead of 200 USD to the supplier.
-This is the true liability at the end of the period and this need to be reflected in customer's
General Ledger. Loss 50 USD should be populated in Loss account.
-Revaluation adjusts these amounts and keeps gain/loss amounts in Unrealized Gain/Loss
accounts defined in Revaluation window.

4. What is Security Rules and Cross validation Rules?

A. It is used to restrict the users from entering the segments. It will work at the
responsibility level.
B. It is used to restrict the end users from entering the code combinations. It will work at
structure level

5. What is Dynamic Insertion?

In GL, you can dynamically create new account code combinations when entering data by
enabling dynamic insertion in the Key Flexfield Segments window. The alternative method
for this is, you can require all accounts to be define manually in the Accounts Combinations
window.
Points to Remember:
-Dynamic instertion can be enabled or disabled at any time.
-You can define cross validation rules to prevent incorrect account combinations from being
created by dynamic insertion.
-If you are defining an Accounting Flexfield for Oracle Projects, you must define your
segment with the Allow Dynamic Inserts option set to Yes.

6. Difference between Standard Accrual and Standard Cash?

Standard Accrual
In case of Standard Accrual, Invoice and Payment Accounting will be there.
Reason: Transaction happens in two phases.
1) Order goods and receive goods(Create PO, Create Receipt, Create Invoice and account it)
2) Pay the amount for received goods within due time set by the supplier( Pay the invoice
and account it)
Since you are not paying the amount immediately, you need to keep track of the amount
needs to pay to the supplier after phase one. You maintain this amount in Liability A/C(Cr).
After second phase, you debit your Liability A/C and credit your Cash A/C which shows your
cash flow from your organization to the supplier.

Standard Cash
In case of Standard Cash, only payment accounting will be there.
Reason: While purchasing an item you pay amount immediately to the supplier. So you
don't have any debt to the supplier to record. So there is nothing to record in Liabilty A/C.

7. Explain Flexfield Qualifiers in GL?

Need to assign qualifiers to individual accounting key flexfield segments to identify or
represent the purpose in COA.

Natural Account Each Accounting Flexfield structure must contain only one natural account
segment. When setting up the values, you will indicate the type of account as Asset,
Liability, Owner's Equity, Revenue, or Expense.
Balancing Account Each structure must contain only one balancing segment. Oracle
General Ledger ensures that all journals balance for each balancing segment.
Cost Center This segment is required for Oracle Assets. The cost center segment is used in
many Oracle Assets reports and by Oracle Workflow to generate account numbers. In
addition, Oracle Projects and Oracle Purchasing also utilize the cost center segment.
Intercompany General Ledger automatically uses the intercompany segment in the
account code combination to track intercompany transactions within a single ledger. This
segment has the same value set and the same values as the balancing segment.

8. Primary Ledger Vs Secondary Ledger Vs Reporting Currency

Primary Ledger Vs Secondary Ledger
Use secondary ledgers for supplementary purposes, such as consolidation, statutory
reporting, or adjustments for one or more legal entities within the same accounting setup.
For example, use a primary ledger for corporate accounting purposes that use the corporate
chart of accounts and subledger accounting method, and use a secondary ledger for
statutory reporting purposes that use the statutory chart of accounts and subledger
accounting method. This allows you to maintain both a corporate and statutory
representation of the same legal entity's transactions in parallel.
Reporting Currency Vs Secondary Ledger
Reporting Currencies are not the same as secondary ledgers. Looking at the 4 C's that
define a ledger, we have a chart of accounts, calendar, accounting method, and currency. If
you only need multiple currencies to support your reporting requirements, use reporting
currencies. If you need to account for your data using different calendars, charts of
accounts, accounting methods in addition to currency, use a secondary ledger.

9. What is Adjusting Period?

Typically, the last day of the fiscal year is used as an adjusting period to perform adjusting
and closing journal entries. Once you begin using your accounting calendar, you cannot
change its structure to remove or add an adjusting period. Choosing whether to include an
adjusting period or not in your calendar is a very important decision. You can have an
unlimited number of adjusting periods.

10. What is 2 way, 3 way and 4 way matching?

Answer Making payments to the suppliers in 3 ways. what ever you have ordered for the
PO we will make the payment for the suppliers in 2-way(we will compare two documents
PO and Invoice).

eg:Suppose we Had given PO for 100 items ,for that we will receive invoice for 100 items.
so that we will make payment for that 100 items.

2) In 3-Way we will compare 3 documents

PO+reciept+Invoice

Eg:Suppose we have ordered 100 items in PO. But we had received only 80 items ,But we
had received invoice for 100 items. so, we will make payment for only 80 items

3) IN 4-Way we will compare 4 documents

PO+Receipt+Invoice+Inspection

Eg:Suppose we have 100 items in PO. Suppers send us 80 items We will do inspection on
those items what ever we have received, If 10 items got damaged. finally, we are
going to make payment to the 70 items only.

11. What is Payment Terms and How to define Payment Terms?

Payables uses payment terms to automatically calculate due dates, discount dates, and
discount amounts for each invoice you enter. Payment terms will default from the supplier
site. If you need to change the payment terms and the terms you want to use are not on
the list of values, you can define additional terms in the Payment Terms window.

12. What is SWEEP Program? Explain Process Of Sweep Program?

This particular program is run in order to transfer un-accounted invioce to next opened
period during period end closing of Accounts Payable. In fact you can't close Payable Period
if you have Un-Accounted Invoice in Payables. In order to negotiate (Transfer) these invoice
to next open period this program is run. So that the Payable period can be closed.

13. How many types of Purchase Orders (PO’s)?

Standard Purchase Order: It’s a legal document to buy the goods or services by supplier
it will be created when we know the goods or services, price, quotation, delivery schedule
and accounting distribution and also is one time purchase order

Blanket PO: Blanket PO is created when you know the detail of the goods or services you
plan to buy from a specific supplier in a period, but you do not know the detail of your
delivery schedules.

Planned PO: Planned PO is a long–term agreement committing to buy items or services

from a single source. You must specify tentative delivery schedules and all details for goods
or services that you want to buy, including charge account, quantities, and estimated cost.

Contract PO: Contract PO is created when you agree with your suppliers on specific terms
and conditions without indicating the goods and services that you will be purchasing.

Particulars SPO PPO BPA CPA

Terms and √ √ √ ×
Conditions
Goods or √ √ √ ×
Services
Price √ √ May be /May not ×
Quantity √ √ × ×
Delivery √ May be/May not × ×
Schedule
Distribution √ √ × ×

14. Explain Approval Hierarchies in PO.

Approval hierarchies let you automatically route documents for approval. There are two
kinds of approval hierarchies in Purchasing: position hierarchy and employee/supervisor
relationships.
If an employee/supervisor relationship is used, the approval routing structures are defined
as you enter employees using the Enter Person window. In this case, positions are not
required to be setup.
If you choose to use position hierarchies, you must set up positions. Even though the
position hierarchies require more initial effort to set up, they are easy to maintain and allow
you to define approval routing structures that remain stable regardless of how frequently
individual employees leave your organization or relocate within it.
15. What is SLA?
16. What is MOAC?

17. How many types of AP Invoices?

AP INVOICES: 11 invoice are there

1) Regular invoice (9) 2) Special invoice(2)

1)Regular Invoice
1. Standard invoice 2. Credit memo 3. Debit memo 4. Prepaid invoice 5. Expense report
6. Quick invoice 7. Mixed invoice 8. PO default 9. Withholding Tax invoice

2)Special Invoice
1. Recurring invoice2. Interest invoice

18. How Many types of AR Invoices?

AR TRANSACTIONS (Invoice) 7
1. Invoice 2. Credit memo 3. Debit memo 4. Deposit 5. Guaranty 6. Chargeback 7. Bills
Receivables.

19. Difference between Standard and mixed Invoices?

Standard Invoices: Standard Invoice are invoices from a supplier representing an amount
due for goods or services purchased. Standard invoices can be either matched to a purchase
order or not matched. Standard invoices must be positive amounts.

Mixed Invoices: Mixed Invoices can be matched to both purchase orders and invoices.
Mixed invoices can have either positive or negative amounts.

20. Difference between AP Invoice and AR Invoices?

AP Invoice: it is nothing but what amount going out towards receiving Raw material from
the vendor or supplier. (Expenses)
AR Invoice: it is nothing but what amount coming in buy selling the product to customer or
parties (Revenues)

21. What is Pre Payment in AP?

Prepayment is Advance Payment made to supplier by Organization or Employee. Later it will

apply against the feature debit items.
These are two types Permanent Prepayment, Temporary Prepayment.

22. What is Key flex filed how many types in GL, AP, AR, & FA?

Key Flex field: is used to capture mandatory information of the organizations

In GL 3 types 1. Accounting flex field (mandatory) 2. Reporting attribute (optional) 3. Gl

ledger flex field (optional)
IN AP No flex fields
IN AR Two types 1. Sales Tax Location flexfield (mandatory) 2. Territory Flexfield
In FA Three Flex field i.e. Category (mandatory), Asset key (mandatory), Locations flex
field.

23. What is Debit Memo and Credit Memo in AP?

Its negative amount identified by Customer and sent to Supplier. Ex: Purchase Returns.
Its negative amount identified by Supplier and sent to the Customer. Ex: TDS Payables

In Payable we are receiving the material from supplier. so we have to pay the amount to
the supplier. in case supplier has send the goods more than what we order at the point of
we have to return the goods reduce the accounting balance.
We send a memo to the supplier is called as debit memo or supplier send a memo is called
as credit memo. Both of the reducing our liability.

Ex: In Payables Debit Memo and Credit Memo functionality is same It decreases the supplier
balance (i.e. decreases the liability) Eg Supplier has send you invoice X with an amount of
$100 but Later we found there is mismatch in quantity (more quantity billed)so we will
inform to customer. Then customer has sent you the credit memo but if customer says send
me the debit memo then you will generate debit memo from your end. Both are same as
functionality.

24. What is Debit Memo and Credit Memo in AR?

In AR Debit memo is Positive Amount for example we are selling the product to the
customer.
Either we may forget to add a freight charges or some other thing. So at that time we are
prepare or Rise the Debit memo it is increased the Org balance.
(Customer is Under Charged at that time Org prepare Debit memo)

In AR Credit memo is Negative Amount if you billed more than your customer then Org
need to raise Credit memo to give the credit to your Customer, so it is decreasing the Org
balance.
(Customer is Over Charged at that time Org prepare Credit memo)