|Oracle Public Sector Financials (International) User Guide|
Part Number E13418-03
Oracle Public Sector Financials (International) extends Oracle Financials functionality and provides the basis for an integrated financial management solution for public sector agencies, providing features such as the following:
Construction Industry Scheme
Single Third Party
Setup windows are provided to enable the Oracle Public Sector Financials (International) features described in this guide. Setup procedures for each of the features are described in feature setup chapters.
Oracle Public Sector Financials (International) provides extensions to the following products:
Oracle General Ledger
Application Object Library
Subledger Security is a security feature used in Payables, Receivables, and Purchasing. Subledger Security is a tool rather than a product and is implemented by the systems administrator.
Modules affected by or enhanced in Oracle Public Sector Financials (International) are shown in the Oracle Financials Modules Affected by or Enhanced in Oracle Public Sector Financials (International) diagram .
The relationship of Oracle Public Sector Financials (International) features to Oracle Applications is shown in the Oracle Public Sector Financials (International) Features diagram.
The diagram below shows the Oracle Financials modules affected by or enhanced in Oracle Public Sector Financials (International).
Oracle Financials Modules Affected by or Enhanced in Oracle Public Sector Financials (International)
The diagram below shows the Oracle Public Sector Financials (International) features as described in Oracle Public Sector Financials (International) Features.
Oracle Public Sector Financials (International) Features
The features in Oracle Public Sector Financials (International) conform to worldwide generally accepted accounting principles. However, some features are country specific and might not be relevant or appropriate everywhere.
The following Oracle Public Sector Financials (International) features function with the Global Accounting Engine:
Single Third Party
The remaining Oracle Public Sector Financials (International) features are not tested with the global accounting engine.
The table below and the Country or Government Specific Features Reference Notes table list features that might not be relevant in every country. Oracle recommends seeking advice from a qualified accountant about the implications of using a country specific feature.
|Feature||Where Required||Reference Note||Applicable in Additional Countries|
|Cash and Accruals Support||UK||1||Yes|
|Combined Basis Accounting||UK||1||Yes|
|Construction Industry Scheme||UK||2||Yes; some reports may not be appropriate|
|Extended Dunning Letter Charges||Netherlands||Yes; where legislation applies|
|Modified Historic Cost Accounting||UK||4||No|
|Inflation Accounting for Assets||UK||5||No|
|Single Third Party||France||3||Yes|
The table below describes the reference notes listed in the Country or Government Specific Features table.
|Reference Note Number||References|
|1 Cash and Accruals Support and Combined Basis Accounting||The United Kingdom (UK) Government has specified a move from cash-based accounting to accrual-based accounting. In some cases both accounting methods are retained in perpetuity. For information on UK requirements for combined basis accounting and cash and accruals, see Better Accounting for the Taxpayer's Money; Resource Accounting and Budgeting in Government, HMSO Cm2929.|
|2 Construction Industry Scheme||Oracle Public Sector Financials (International) meets the UK Inland Revenue requirements for construction industry scheme deductions. However, the reports are not approved as substitutes by the UK Inland Revenue. For information about UK Inland Revenue requirements for the construction industry, see Construction Industry Tax Deduction Scheme, External Communication Unit of the Inland Revenue, Construction Industry Series IR14/15 (CIS), March 1999, including addendums CIS Fact 1 and CIS Fact, 3 March 1999.|
|3 Exchange Protocol, Dossier, and Single Third Party||Oracle Public Sector Financials (International) meets the French government public sector requirements for exchange protocol, dossier, and single third party. For information on French requirements, see Reglementation comptable Etablissements Public Administratifs et Nationaux M9.1, M14, M21 at the following website: http://www.finances.gouv.fr/reglementation/instructions_comptables.|
|4 Modified Historic Cost Accounting||This feature was the initial response to the UK Government’s requirement for the revaluation of assets and associated depreciation. The scope was limited to positive inflationary index movements.|
|5 Inflation Accounting for Assets||This feature is the replacement for Modified Historic Cost Accounting, and has been enhanced to handle both positive and negative movements. The requirement to amortize the revaluation reserve has also been included.|
Budgeting Extensions provide an expansion of the standard budgeting features present in General Ledger. Features include the following:
optional double entry enforced budgeting
budget spreadsheets import
budget history inquiry
next year budget creation, percentage changes to existing budgets, and budget reprofiling for whole or partial years
Cash and Accruals Support enables different but related ledgers by assigning cash and accruals as secondary ledgers and maintain the ledgers using the following accounting methods:
Different ledgers use the same chart of accounts, currency, and calendar facilities. Ledger access is provided using the GL: Data Access Set profile option.
Combined Basis Accounting is an Oracle Public Sector Financials (International) feature that supports resource accounting. Resource accounting is a financial management method that uses accrual basis accounting techniques, supplemented with the ability to report on a cash basis.
The following windows provide enhancements:
The System Options window is enhanced to enable combined basis accounting.
The Open and Close Accounting Periods window ensures that a period cannot be closed if there are unposted cash basis items.
Receipt transactions can be entered in the standard receivables windows.
The Run General Ledger Interface window automatically submits the General Ledger transfer to the Receivables Cash Basis GL Transfer Execution concurrent process. This process posts the transactions to the cash ledger as well as the accrual ledger.
The Oracle General Ledger Cash Basis Transfer routine automatically generates the following reports:
Combined Basis Accounting: Cash Basis Accounting Journal Entries Report
This report displays the journal entries that are not yet posted to the cash ledger.
Combined Basis Accounting: Cash Basis Execution Report
This report shows a summary of all transactions by category and currency that comprise the journal entries to the cash ledger.
Combined Basis Accounting: Cash Basis Unposted Items Report
This report is generated automatically if there are unposted items for a given General Ledger date range.
Combined Basis Accounting: Cash Basis Drilldown Report
This report displays the information of the receivables transactions that are posted to the general ledger.
Commitment Budgetary Control enables users to check funds availability online for all types of contract commitments, and encumber funds online. The Commitment Model enables public sector organizations to manage their business using dual budgeting, which includes standard budgetary control and commitment budgetary control. The standard budget represents the amount an organization is willing to pay in a given period. The commitment budget represents the amount of encumbrances an organization is willing to commit itself to in a given period.
The following features are included in Commitment Budgetary Control:
set up commitment budgetary control check level
check and reserve funds online
commitment budgetary control online inquiry
Construction Industry Scheme extends automatic withholding tax (AWT) features in Payables and Purchasing to comply with UK Inland Revenue requirements for collecting tax from construction subcontractors. The following features are included:
Registering with Inland Revenue to enable subcontractors setup Construction Industry Scheme
Obtaining registration number from Inland Revenue
Process Construction Industry Scheme payments using the standard Payables functionality
Contractors file the monthly returns online or manually
Generate the following reports required by subcontractors and Inland Revenue for construction industry work:
Construction Industry Scheme: CI36 End of Year Returns Report
Construction Industry Scheme: Certificate Renewal Reminders Report
Construction Industry Scheme: Missing Vouchers Report
Construction Industry Scheme: Missing/Expired Certificates Report
Construction Industry Scheme: Missing/Expired Certificates with Pending Payments Report
Construction Industry Scheme: Voucher Report
Construction Industry Scheme: Update Certificate Types/Percentages Process
Construction Industry Scheme: Monthly Returns Report
Construction Industry Scheme: Registered Supplier Listing Report
Construction Industry Scheme: Subcontractor Verification Status Report
Construction Industry Scheme: Subcontractor Statement of Payment and Deductions Report
A contract commitment is the financial representation of a legally enforceable agreement with a third party or an internal commitment of funds. Contract Commitment provides organizations with the ability to encumber contract activity from a financial perspective without the manufacturing type data required in Oracle Purchasing. Contract Commitment supports the Commitment Model which focuses on the encumbrance expenditure type.
Contract commitments usually extend over a period of years. This means that the contract commitment created in a certain fiscal year is paid against different funding budgets spread over multiple fiscal years. The amount that is expected to be paid in a certain fiscal year is the payment forecast. The set of payment forecasts that belongs to a contract commitment is the payment schedule.
Contract Commitment includes the following features:
create and maintain standard, cover, and release contract commitments
document control regulates the status of contract commitments during the contract commitment life cycle
Contract Commitment uses Oracle Workflow to route contract commitments for approval and to determine who has approval authority, who has access to contract commitments, and what actions employees can take against these contract commitments.
Dossier extends the functionality of General Ledger to provide control over the amount and timing of spending within an organization, which can be particularly important when budgets for large projects must be maintained and used separately. In addition, dossiers enable one or more persons to perform the following functions:
create budgetary transfers
approve budgetary transfers
manage funds in a structured and controlled manner
Enhanced Funds Checker is an enhancement to the General Ledger funds checking and budgetary control process.
This feature enables public sector organizations to manage budgets more effectively because funds can be reserved in future periods, even if the periods cross over different budgets. The multiple funding budgets feature enables an organization to move away from unwieldy multiple year budgets.
Exchange Protocol provides public sector clients with a batched document approval system. Exchange Protocol enables an organization to manage the separate tasks of authorizing and paying the same set of expenses within the required legal framework at the same time. These tasks usually fall to individuals known as the authorizer and the accounts officer, which provide a secure approvals system.
In Exchange Protocol, the process of managing expenses involves creating, viewing, and modifying exchange protocol documents, that is, dialog units and transmission units, both of which are collections of financial documents.
Exchange Protocol enables users to do the following:
define an approval hierarchy
define specific numbering
view dialog units and transmission units
group subledger transactions by client into a dialog unit
batch dialog units into a transmission unit
modify dialog units and transmission units
submit units for approval
accept, reject, or put on hold dialog units or transmission units via a workflow process
Generic Interface allows flexible mapping of external feeder system books and periods to General Ledger. The feature provided the ability to define and control feeder system interfaces without programming. Typically, feeder systems encompass third-party software such as payrolls.
Generic Interface enables users to do the following:
load and validate feeder files
import and post feeder file transactions
reload feeder files in case of error
archive, purge, and restore feeder file transactions
The Hierarchical Drill-Down Inquiry procedure enables online, top-down General Ledger inquiries. Inquiry hierarchy levels can be defined, with segments of the chart of accounts assigned to each level and balances summarized by segment at each level. Balances can be viewed from the first to last segments of an inquiry hierarchy down to specific journal lines.
The following types of inquiries can be made at each defined level in the hierarchy:
Journal lines can be viewed beyond the lower level of the hierarchy.
Inflation Accounting for Assets enables Oracle Assets users to revalue assets and create accounting entries in line with the UK government’s Resource Accounting and Budgeting guidelines.
Inflation Accounting for Assets provides for the following:
revaluation of asset cost by either price index or professional valuation
revaluation of current and prior year depreciation
amortization of the revaluation reserve by a transfer to the general fund
negative revaluation below historical cost with a charge to a nominated operating account
Installment Terms enable adjustments to payment terms on invoices that have already gone to customers. An audit trail is kept of changed invoices.
The Internal Trading feature controls the raising and authorization of cross charges between charge centers within the same organization. Budgetary control and encumbrance accounting are supported. The following features are included:
charge center creation and maintenance
charge creation and progress tracking
cross charge authorization
ability to view and reassign notifications
ability to relay authorizer notes to the charge creator, users above and below in the approval hierarchy, and to the receiving charge center
Multi-Period Posting provides accounting rule functionality, currently available in Receivables, for Oracle Public Sector Financials (International).
There is a need to recognize expense as it is incurred. Therefore, if an insurance expense is incurred for the year, Multi-Period Posting allows an accounting rule to be set against that invoice and the insurance expense is spread over the year. This spread is defined by the rule type that is set up and whether or not the multi-period posting line amounts are subsequently manually altered. If budgetary control is enabled, encumbrance journals are created for all the invoice distribution and multi-period posting lines in the appropriate periods.
When the insurance invoice is transferred to General Ledger, a credit to the account and a debit to the future postings account is created for each invoice distribution line.
At each period end, the Multi-Period Posting: Recognize Expense Program Report is generated. A credit to the future postings account and a debit to the expense account are created for each multi-period posting line. It is possible to run the Multi-Period Posting: Recognize Expense Program Report in Preview mode, so that the multi-period posting lines can be viewed before they are transferred to General Ledger.
Secondary Invoice Approval provides a secure method of enforcing departmental approval.
Secondary Invoice Approval provides two additional levels of approval for invoices after they have passed AutoApproval. The invoices are approved by designated secondary approvers within an organization's business unit and optionally passed on for final approval, for example, by a final payments unit such as Central Finance. Only after completing the approval process are invoices marked as ready for payment.
If additional control is required over who can approve which invoices, approvers can be assigned flexfield ranges. Approvers drill down to the individual invoice lines and approve them.
Single Third Party is a single entry point to financial information when a third party is both a customer and a supplier. A third party can be tracked as a single legal entity within the application, which enables calculation of a net balance.
Note: Netting is legal only in certain countries.
In Receivables, a single third party is defined as a unique combination of a customer, who is also a supplier, at a specific location. Similarly, in Payables a single third party is defined as a supplier, who is also a customer, at a specific location.
Single Third Party enables the user to perform the following functions:
create, view, or modify a single third party using the Single Third Party - Main window
view outstanding single third party balances using the Single Third Party Netting Balance window
set up one or more netting types using the Netting Transaction Types window
create and post netted single third party documents using the Submit Netting Batches window
For information on where netting is allowed, see International Implications.
Also known as periodic payments, Standing Charges enables open-ended and fixed length standing charge agreements with customers, calculated in advance or arrears.
The following features are included:
definable charge periods used in standing charge agreements
definable charge items for goods and services, used in standing charge agreements
automatically generated invoices from standing charges
price changes and price history for standing charge items
invoice history for each standing charge
Subledger Security is an extension to Oracle Financials that enables the user to selectively partition data within a single install of Oracle Financials.
Subledger Security provides a system where all business units can access their own financial information only.
The following Oracle Public Sector Financials (International) features are obsolete:
Gross Based VAT
For information on gross based VAT, see Payment Terms, Oracle Payables User Guide
Extended Dunning Letter Charges
The Extended Dunning Letter Charges feature is obsolete in Oracle Public Sector Financials (International) and replaced by Late Charges in Oracle Receivables.
For information on Late Charges, see Late Charges, Oracle Receivables User Guide.
Modified Historic Cost Accounting
Inflation Accounting for Assets (IAC) replaces Modified Historic Cost Accounting.
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