1

Cost Management Cloud

Receipt Accounting

Sreeni Devireddy
Director, Product Management
Safe harbor statement

The following is intended to outline our general product direction. It is intended for information purposes
only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or
functionality, and should not be relied upon in making purchasing decisions. The development, release,
timing, and pricing of any features or functionality described for Oracle’s products may change and remains
at the sole discretion of Oracle Corporation.
Statements in this presentation relating to Oracle’s future plans, expectations, beliefs, intentions and
prospects are “forward-looking statements” and are subject to material risks and uncertainties. A detailed
discussion of these factors and other risks that affect our business is contained in Oracle’s Securities and
Exchange Commission (SEC) filings, including our most recent reports on Form 10-K and Form 10-Q under
the heading “Risk Factors.” These filings are available on the SEC’s website or on Oracle’s website
at http://www.oracle.com/investor. All information in this presentation is current as of September 2019 and
Oracle undertakes no duty to update any statement in light of new information or future events.

2 Confidential – © 2021 Oracle Internal/Restricted/Highly Restricted. PTT Created Content.

Agenda

• Procure to Pay – Accounting Perspective

• Accrue On Receipt - Reconciliation
• Period End Accruals
• Configuring Accounts

3 Confidential – © 2021 Oracle Internal/Restricted/Highly Restricted. PTT Created Content.

Procure to Pay: Accounting Perspective (Inventory Item)
• Transfer Transactions from Receiving to Costing • Transfer Transactions from Inventory to Costing
• Create Receipt Accounting Distributions • Create Cost Accounting Distributions
• Create Accounting • Create Accounting
o Charge Account
o Accrual Account
o Variance Account
o Charge Account Receipt Accounting Cost Accounting

Requisition Purchase Order Receipt Put Away

• Encumbrance (C) • Encumbrance (O)

• DR Receiving Inspection* • DR Inventory
• CR Accrual • CR Receiving Inspection*
• CR Non-Recoverable Tax
• Liquidate Encumbrance

Payment Invoice • DR Receiving Inspection • DR Inventory

• CR Invoice Price Adjustment • CR Receiving Inspection
• DR Accrual
• DR Liability • DR Receiving Inspection
• DR Non-Recoverable Tax
• CR Cash Clearing • CR Exchange Variance Adjustment*
• DR Recoverable Tax
• DR Invoice Price Variance
• DR Receiving Inspection
IPV – Invoice Price Variance • DR Freight
IPA – Invoice Price Adjustment • CR Tax IPA, Tax REA*
• DR Exchange Rate Variance Item Cost (Actual) =
ERV – Exchange Rate Variance
• DR Tax IPV, Tax ERV PO Price + Non-Recoverable Tax +
REA – Rate Exchange Adjustment • DR Receiving Inspection
TRV – Tax Rate Variance • DR Tax Rate Variance IPV + ERV + TIPV + TERV + TRV
• CR TRV Adjustment*
# Inventory Item (Actual/Average Costing) • CR Liability
# Tax Point Date = Invoice • Transfer Costs to Cost Management
* Mapping sets
4 Confidential – © 2021 Oracle Internal/Restricted/Highly Restricted. PTT Created Content.
Procure to Pay: Expense Item (Accrue On Receipt)

o Charge Account
o Accrual Account Receipt Accounting
✓ Charge Account o Variance Account

Requisition Purchase Order Receipt Put Away

• Encumbrance (C) • Encumbrance (O) • DR Expense

• DR Receiving Inspection*
• CR Expense Accrual • CR Receiving Inspection*
• CR Non-Recoverable Tax
• Liquidate Encumbrance

Payment Invoice
• DR Receiving Inspection • DR Expense
• CR Invoice Price Adjustment • CR Receiving Inspection

• DR Liability • DR Expense Accrual • DR Receiving Inspection

• CR Cash Clearing • DR Non-Recoverable Tax
• DR Recoverable Tax
• DR Allocated Freight
• DR Invoice Price Variance
• DR Exchange Rate Variance
• DR Tax IPV, Tax ERV
• DR Tax Rate Variance
• CR Liability
• CR Exchange Variance Adjustment*
• DR Receiving Inspection
• CR Tax IPA, Tax REA*
• DR Receiving Inspection
• CR TRV Adjustment*

* Mapping sets
5 Confidential – © 2021 Oracle Internal/Restricted/Highly Restricted. PTT Created Content.
Accrual Discrepancies

• Quantities differ between receipts and invoices

• Discrepancies in supplier billing

• Accounts Payable clerk matched an invoice to wrong purchase order or wrong purchase order
line

• Receiving clerk received against the wrong purchase order or wrong purchase order line

• Miscellaneous inventory or work in process transactions that do not belong to the accrual
accounts

6 Confidential – © 2021 Oracle Internal/Restricted/Highly Restricted. PTT Created Content.

Accrual Reconciliation - Demo

o Transfer Transactions from Receiving to Costing DR Receiving Inspection

Purchase Order o Create Receipt Accounting Distributions CR Accrual ($5000)
(Q=50 * P= $100) o Create Accounting
DR Accrual ($4900)
o Create Accounting (Invoice) CR Liability

o Transfer Costs to Cost Management Accrual Reconciliation Report

Receipt o Create Receipt Accounting Distributions CR Accrual ($5000) DR Accrual ($4900)
o Match Receipt Accruals
DR Accrual ($100)
o Clear Accrual Balances CR Receiving Inspection
Invoice
(Q=49 * P=$100) Accrual Reconciliation Report
o Create Accounting
o Match Receipt Accruals CR Accrual ($4900) DR Accrual ($4900)

(Additional Non-Recoverable Taxes)

7 Confidential – © 2021 Oracle Internal/Restricted/Highly Restricted. PTT Created Content.
Clear Accrual Balances

• Accrual Clearing Rules (Doc ID 1507721.1)

• Examples

8 Confidential – © 2021 Oracle Internal/Restricted/Highly Restricted. PTT Created Content.

Procure to Pay: Expense Item (Period End Accrual)
• DR Expense
• DR Non-Recoverable Tax
✓ Charge Account • DR Recoverable Tax
✓ Accrual Account • DR Variances
✓ Charge Account ✓ Variance Account • CR Liability

Purchase
Requisition Receipt Invoice Period End Next Period
Order
• Encumbrance (C) • Encumbrance (O) • Liquidate Encumbrance
• DR Expense
• DR Non-Recoverable Tax
✓ Charge Account • DR Recoverable Tax
✓ Accrual Account • DR Expense • DR Expense Accrual • DR Variances
✓ Charge Account ✓ Variance Account • CR Expense Accrual • CR Expense • CR Liability

Purchase
Requisition Receipt Period End Next Period Invoice
Order
• Encumbrance (C) • Encumbrance (O) • Liquidate Encumbrance

After the Accounts Payable period is closed Closing Receipt Accounting Period
• Create Un-invoiced Receipt Accruals Accrual Reversal Process
• Create Accounting Process
• Create Accrual Reversal Accounting process
Receipt Accounting Tasks and Events

9 Confidential – © 2021 Oracle Internal/Restricted/Highly Restricted. PTT Created Content.

Period End (Vs) Accrue on Receipt

Task: Manage Common Options for Payables and Procurement

10 Confidential – © 2021 Oracle Internal/Restricted/Highly Restricted. PTT Created Content.

Configuring Accounts

Ledger

Accounting Method

Journal Entry
Rule Sets

Journal Line Rules Account Rules Description Rules

Mapping Sets

11 Confidential – © 2021 Oracle Internal/Restricted/Highly Restricted. PTT Created Content.

Configuring Accounts

• Using seeded SLAM

• SLA and Cost Management - Replay
• Mapping Sets FBDI – Replay
• TAB Setup – Replay
• SLA Troubleshooting Guide – 1
• SLA Troubleshooting Guide – 2

12 Confidential – © 2021 Oracle Internal/Restricted/Highly Restricted. PTT Created Content.

Receipt Accounting: New Features (20A – 21A)

• Exclude Invoice Cost Variances from Cost Management (site level profile option; primarily std costing)

• Period Close Validation Process

• Run Receipt Accounting Processes for multiple BUs

• Non-Recoverable Taxes on Intercompany Transfers

Complete list of new features are at Oracle Cloud Release Readiness

13 Confidential – © 2021 Oracle Internal/Restricted/Highly Restricted. PTT Created Content.

14 Confidential – © 2020 Oracle Internal/Restricted/Highly Restricted