Colombia

Third Party Management

Third Party Information

In Colombia, the tax authority (DIAN) uses an individual's or a company's taxpayer identification number to identify tax obligations on invoices. The taxpayer ID is called the third party ID and the management of transactions is called third party management.

For the natural accounts that require third party information, you must associate the customer, supplier, or bank third party information with transactions in General Ledger, Payables, Receivables, and Purchasing. Companies must submit reports to the DIAN that show natural account activity by third party ID.

Some large companies must also submit magnetic media (electronic files) at the end of each year. Magnetic media reports on third party natural account movements according to threshold levels assigned by the DIAN. For more information, see Magnetic Media ReportingMagnetic Media Reporting.

Oracle Financials provides functionality to help you meet the Colombian third party management requirement:

Use of the Third Party ID

Use the third party ID for transactions in these applications:

For miscellaneous transactions, assign the third party ID of your company's bank to all miscellaneous transactions that require third party information.

Legal Entities

The third party ID for domestic companies and organizations, or legal entities, has a single validation digit between 0-9. Only one validation digit value is correct for any given third party ID. For example, the correct validation digit for the third party ID 123456789 is 6, or 123456789-6. Oracle Financials verifies that the validation digit is correct.

Foreign Entities

Foreign companies and individuals, or foreign entities, do not have a third party ID assigned by the DIAN. Companies must create an internal numbering scheme to assign to foreign entity transactions, according to these guidelines:

Setting Up Oracle Financials for Third Party Management

This section explains the setup tasks in General Ledger, Oracle Payables, Oracle Receivables, and Oracle Purchasing to manage third party information.

Complete these setup steps to set up third party information for Oracle Financials:

General Ledger

Payables

Receivables

Purchasing

Setting Up General Ledger

Complete these steps to set up General Ledger for third party information:

Defining Journal Sources

Use the Import Journal References option in the Journal Sources window to import postings into General Ledger from Oracle Payables, Oracle Receivables, Oracle Purchasing, and non-Oracle applications. The Import Journal References option lets General Ledger create third party balances.

Note: When you import data from non-Oracle applications, do not use a standard journal source. Use the Define Journal Sources window to define new journal sources for external data.

To define journal sources for third party management:

  1. Navigate to the Journal Sources window.

  2. Enter or query the journal sources that you want.

  3. Check the Import Journal References check box next to each journal source.

  4. Save your work.

Defining Third Party Control Accounts

Use the Third Party Control Accounts window to identify natural accounts that require third party information.

You must identify each natural account that requires third party information. General Ledger only refers to the natural accounts that you mark as third party reportable in the Third Party Control Accounts window when collecting third party transaction information for third party reports and magnetic media reporting.

To define third party control accounts:

  1. Set up your chart of accounts.

  2. Navigate to the Third Party Control Accounts window.

  3. Click on the Copy From GL Account Value Set button to display the natural accounts in your chart of accounts.

    Only postable accounts are shown or copied in the Third Party Control Accounts window.

  4. Check the Required Third Party ID check box next to each natural account that requires third party information.

  5. Save your work.

Setting Up Oracle Payables

Complete these steps to set up Oracle Payables for third party information:

Defining Payables System Setup

Before you define Oracle Payables for third party management, you must set the JL: Copy Tax Identifier Number profile option to Yes at the Responsibility level.

Use the Supplier Number tabbed region in the Payables System Setup window to set up Oracle Payables for third party management and ensure that automatic sequential supplier numbers are not generated. Oracle Payables uses the supplier third party ID as the supplier number.

To define Payables System Setup for third party management:

  1. Navigate to the Payables System Setup window.

  2. Navigate to the Supplier Number region in the Supplier tabbed region.

  3. Select Manual in the Entry field.

  4. Save your work.

Defining Journal Line Types

Use the Accounting and Invoice Tax tabbed regions in the Payables Options window to set Payables options for third party management.

Setting options in the Accounting tabbed region lets Oracle Payables transfer postings to General Ledger in detail.

To define Journal Line Types for third party management:

  1. Navigate to the Journal Line Types window.

  2. Navigate to the Transfer to GL tabbed region.

  3. Select Detail (J).

  4. Save your work.

Define Configuration Owner Tax Options

Setting options in Oracle E-Business Tax lets Oracle Payables create a tax line for an invoice item line and assign the third party ID to the tax line.

To define Configuration Owner Tax Options for third party management:

  1. Navigate to the Create Configuration Owner Tax Options page.

  2. Select the Configuration Owner. This is the operating unit or legal entity name depending on the implementation.

  3. Select Payables and Standard Invoices in the Application Name and Event Class fields.

  4. Navigate to the Others region and deselect the Allow Override for Calculated Tax Lines option.

    Setting this option ensures that Oracle Payables assigns the third party ID to the tax line.

Related Topics

Setting Up Oracle Payables, Oracle Payables Implementation Guide

Overview of Setting User Profiles, Oracle Applications System Administrator's Guide

Payables System Setup, Oracle Payables Implementation Guide

Setting Up Configuration Owner Tax Options, Oracle E-Business Tax User Guide

Setting Up Oracle Receivables

Complete these steps to set up Oracle Receivables for third party information:

Defining Receivables System Options

Use the Transactions and Customers tabbed region in the Receivables System Options window to set Receivables System options for third party management.

Setting Receivables System options lets Oracle Receivables use the customer third party ID as the customer number.

Prerequisites

Before you can define Receivables System Options for third party management, you must set the JL: Copy Tax Identifier Number profile option to Yes at the Responsibility level.

To define Receivables System Options for third party management:

  1. Navigate to the Receivables System Options window.

  2. Navigate to the Transactions and Customers tabbed region.

  3. Uncheck the Allow Payment of Unrelated Transactions check box.

    Unchecking this check box prevents Oracle Receivables from applying the receipts of one customer to the invoices of another customer.

  4. Navigate to the Customers region.

  5. Uncheck the Automatic Customer Numbering check box.

    Unchecking this check box prevents Oracle Receivables from using automatic customer numbering. Oracle Receivables uses the customer third party ID as the customer number.

  6. Save your work.

Defining Banks

Use the globalization flexfield in the Banks window to enter third party information for your company's primary bank branch. For third party purposes, Oracle Receivables and Oracle Payables associate miscellaneous transactions with third party information for your company's bank.

You enter your bank's third party information in the main branch, or primary branch, location in the globalization flexfield in the Banks window. For all other branches, refer to the primary branch for third party information.

Note: Define third party information for your bank's primary branch before you define information for the other bank branches.

To enter third party information for banks:

  1. Navigate to the Banks window.

  2. Enter or query a bank.

  3. Navigate to the globalization flexfield.

  4. In the Primary ID Branch field, enter Yes if the branch is the main bank branch. Enter No if it is not the main branch.

  5. If you entered No in the Primary ID Branch field, enter the name of the bank's main branch in the Primary ID Bank Name field and leave the other fields blank.

    Oracle Receivables refers all miscellaneous transactions entered at a bank branch to the bank's primary branch for third party information.

  6. If you entered Yes in the Primary ID Branch field, leave the Primary ID Bank Name field blank and navigate to the Primary ID Type field.

  7. In the Primary ID Type field, enter Legal Entity or Foreign Entity.

  8. In the Primary ID Number field, enter the third party ID.

  9. If the primary ID type is Legal Entity, enter the third party ID validation digit in the Primary ID Validation Digit field.

  10. Press the OK button.

  11. Repeat steps 2 to 10 for each bank branch.

  12. Save your work.

Setting Up Oracle Purchasing

Use the Purchasing Options window to set Purchasing options for third party management. You must maintain a list of Payables accruals and expenses for each supplier third party ID.

Set the appropriate option in the Accruals tabbed region in the Purchasing Options window to let Oracle Purchasing transfer postings to General Ledger only when a receipt does not have an invoice (non-inventory items only). For inventory items, Oracle Purchasing transfers postings to General Ledger when the receipt is created.

Run the Receipt Accruals - Period End program at the end of the period. When you run the Receipt Accruals - Period End program, Oracle Purchasing transfers postings as an accrual to General Ledger. At the beginning of the next period, reverse the accrual in General Ledger.

Note: When you transfer the posting to General Ledger, run Journal Import in Detail mode.

To keep track of accruals that are not posted to General Ledger, run the Accrual Reconciliation report.

To define Purchasing Options for third party management:

  1. Navigate to the Purchasing Options window.

  2. Navigate to the Accruals tabbed region.

  3. Enter Period End in the Accrue Expense Items field.

  4. Save your work.

Related Topics

Receipt Accruals - Period-End Process, Oracle Purchasing User Guide

Accrual Reconciliation Report, Oracle Purchasing User Guide

Entering Third Party Information

Enter third party information for the following:

You can review and update third party information in the Define Third Parties window, as well as enter new third party information.

Oracle Financials validates the third party ID according to these criteria:

Entering Journal Line Third Party Information

Use the globalization flexfield in the Journals window to enter third party information at the journal line level. The globalization flexfield is available for journal lines with accounts that are third party reportable.

General Ledger provides a list of values with master third party information. If the list of values does not have the third party that you want, enter the new third party using the Define Third Parties window. For more information, see Maintaining Third Party Information.

If you generate journal entries using Mass Allocation or Recurring Journals, General Ledger does not assign a third party ID to journal lines. You need to manually enter the third party ID in the globalization flexfield for journal lines with accounts that are third party reportable.

To enter journal line third party information:

  1. Navigate to the Journals window.

  2. Query or enter a journal.

  3. Enter a journal line.

  4. If the account requires third party information, navigate to the globalization flexfield by navigating to the descriptive flexfield and pressing the Tab key.

  5. In the Third Party ID field, enter the third party from the list of values.

  6. Press the OK button.

  7. Save your work.

Related Topics

Entering Journals, Oracle General Ledger User Guide

Entering Supplier Third Party Information

Use the globalization flexfield in the Suppliers window to enter third party information at the supplier level. Oracle Payables assigns the third party ID as the supplier number after you enter third party information in the globalization flexfield.

For invoices with multiple third parties, you must manually enter the third party ID on each item line and tax line. See Entering Multiple Third Party Information for Invoices for more information.

To enter supplier third party information:

  1. Navigate to the Suppliers window.

  2. Enter supplier information in the header region of the Supplier window.

  3. In the Taxpayer ID field, enter the supplier's third party ID. Leave the Number field blank.

  4. Navigate to the globalization flexfield.

  5. In the Taxpayer ID Type field, enter the third party's identification type, such as Foreign Entity, Individual, or Legal Entity. The default is Legal Entity.

  6. If the identification type is Legal Entity, enter the validation digit in the Taxpayer ID Validation Digit field. Otherwise leave the field blank.

  7. Press the OK button.

    Oracle Payables displays the third party ID with validation digit in the Number field.

  8. Navigate to the Invoice Tax tabbed region.

  9. Specify the Calculation Level as Line.

  10. Uncheck the Allow Calculation Level Override check box.

    These settings in the Invoice Tax tabbed region let Oracle Payables separately calculate each tax line. You can associate multiple third parties with each tax line.

  11. Navigate to the Receiving tabbed region.

  12. Specify Invoice Matching of at least 3-Way for calculation of an accurate balance of receipt accruals.

  13. Save your work.

Related Topics

Entering Suppliers, Oracle Payables User Guide

Entering Multiple Third Party Information for Invoices

Use the globalization flexfield in the Distributions window to enter third party information for distribution lines. For invoices with multiple third parties, you must associate each item line and its corresponding tax line with the correct third party ID.

When you enter invoice distribution lines, by default Oracle Payables assigns the supplier third party ID in the invoice header to each distribution line.

To assign the correct third party ID to each item line and corresponding tax line:

  1. Enter the first item line.

  2. Enter the appropriate third party ID in the globalization flexfield.

  3. Repeat steps 1 and 2 for each item line.

  4. Calculate the tax for the invoice.

  5. Change the default third party assignment in the globalization flexfield on the tax line to the correct third party ID.

  6. Repeat steps 4 to 5 for each item line.

    Note: For invoices that use purchase order matching, Oracle Payables creates one tax line for all items with the same tax code. If there are multiple third party IDs associated with the items, you need to manually create additional tax lines and assign the correct amount and third party ID to each tax line.

Prerequisites

Before you can enter multiple third party information for invoices, you must:

To enter multiple third party information for invoices:

  1. Navigate to the Invoices window.

  2. Query or enter the invoice that you want.

  3. Navigate to the Distributions window by clicking the Distributions button.

  4. Enter the first item line.

  5. Navigate to the globalization flexfield.

  6. In the Taxpayer ID field, enter the correct third party for the item line.

  7. Repeat steps 4 to 6 for each item.

  8. Press the OK button.

    Oracle Payables will calculate the tax at the approval moment.

  9. Navigate to the tax line.

  10. Navigate to the globalization flexfield.

  11. In the Taxpayer ID field, enter the third party from the list of values that corresponds to the item line.

  12. Press the OK button.

  13. Repeat steps 4 to 12 for each item and tax line.

  14. Save your work.

Related Topics

Entering Invoices Overview, Oracle Payables User Guide

Entering Customer Third Party Information

Use the globalization flexfield in the Customers - Standard or Customers - Quick window to enter third party information at the customer level. Oracle Receivables assigns the third party ID as the customer number after you enter third party information in the globalization flexfield.

To enter customer third party information:

  1. Navigate to the Customers - Standard window or the Customers - Quick window.

  2. Enter customer information in the header region of the Customers window.

  3. In the Taxpayer ID field, enter the customer's third party ID. Leave the Number field blank.

  4. Navigate to the globalization flexfield.

  5. In the Primary ID Type field, enter the third party's identification type, such as Foreign Entity, Individual, or Legal Entity. The default is Legal Entity.

  6. If the identification type is Legal Entity, enter the verifying digit in the Primary ID Validation Digit field. Otherwise leave the field blank.

  7. Press the OK button.

    Oracle Receivables displays the third party ID with validation digit in the Number field.

  8. Save your work.

Related Topics

Entering Customers, Oracle Receivables User Guide

Maintaining Third Party Information

Use the Define Third Parties window to maintain master third party information. The master third party information holds all third party records.

When you run the Colombian Third Party Generate Balances program, General Ledger creates new third party information for all postings, including non-Oracle postings, and adds the records to the master third party information.

You can view third party information and modify incorrect information in the Define Third Parties window. If necessary, you can also enter new third party information.

Note: New third party information that you enter in the Define Third Parties window is not checked against new third party information that you enter in the Payables or Receivables globalization flexfield. If you enter the same third party information as the supplier or customer number, you must check that the information is consistent.

To maintain third party information:

  1. Navigate to the Define Third Parties window.

  2. Query the third parties that you want.

  3. In the Name field, enter or update the name of a third party.

  4. In the Type field, enter or update the third party's identification type, such as Foreign Entity, Individual, or Legal Entity.

  5. In the ID field, enter or update the third party ID.

  6. If the identification type is Legal Entity, enter the verifying digit in the Verifying Digit field.

  7. If the identification type is Foreign Entity, change the default third party ID, 444444444, to a unique entry.

  8. Save your work.

Loading Non-Oracle Application Transactions

You can load non-Oracle application transactions into third party tables by first loading the transactions into the GL Interface table and then importing the postings into General Ledger.

The Journal Import program does not verify third party information that you import from non-Oracle sources. General Ledger only validates third party information when you run the Colombian Third Party Generate Balances program. See Generating Third Party Balances for more information.

Note: When you transfer the posting to General Ledger, run Journal Import in Detail mode.

To load non-Oracle data with third party information:

  1. Define a new journal source for non-Oracle data.

    Define the journal source according to the requirements for third party management.

  2. Load data into the GL Interface table, as described in the Oracle General Ledger User's Guide.

    The reference columns in the GL interface table for third party information are:

    • Reference 21 - Transaction Number

    • Reference 22 - Third Party ID

    • Reference 23 - Verifying Digit

    • Reference 24 - Third Party Type

    • Reference 25 - Third Party Name

  3. Run the Journal Import program in Detail mode.

    To run the Journal Import program in Detail mode, leave the Create Summary Journals check box unchecked so that General Ledger can create detailed postings.

Related Topics

Importing Journals, Oracle General Ledger User Guide

Generating Third Party Balances

Use the Colombian Third Party Generate Balances program to update transactions that require third party information. You can run the Colombian Third Party Generate Balances program as often as you need to update account/third party balances. An account/third party balance refers to the balance for each third party ID for each natural account.

The Colombian Third Party Generate Balances program performs these operations:

The Colombian Third Party Generate Balances program compares the third party information for each transaction to existing master third party records. When the program finds new third party information, it creates a new third party record. Whenever the program finds missing or incorrect third party information, the following processing occurs:

See Correcting Third Party Balances for more information about correcting the processing of third party transactions.

Navigate to the Third Party Programs window to run the Colombian Third Party Generate Balances program. Use the Standard Request Submission windows to submit the Colombian Third Party Balances Error report.

Program Parameters

Enter the following parameters to specify the desired options:

Fiscal Period

Enter the fiscal period.

Journal Batch

Enter the journal batch that you want to use. If you do not enter a journal batch, the default is all journal batches.

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Correcting Third Party Balances

Use the Colombian Third Party Reverse Balances program to reverse an incorrect run of the Colombian Third Party Generate Balances program.

The Colombian Third Party Generate Balances program generates an error report of all transactions without third party information or with third party information that does not match master third party information.

There are three types of error processing of third party information:

You should review the error report each time you run the Colombian Third Party Generate Balances program.

There are different steps for correcting errors in third party processing, depending on the type of error. You only need to run the Colombian Third Party Reverse Balances program for General Ledger and non-Oracle transactions with incorrect master third party information, or for transactions that were successfully processed for natural accounts that are incorrectly marked as third party reportable.

To navigate to the Colombian Third Party Reverse Balances program, use Colombia General Ledger: Colombian Localization > Third Party Programs. Use the Standard Request Submission windows to submit the Colombian Third Party Reverse Balances program.

To correct General Ledger and non-Oracle transactions, where third party information is correct and master third party information is incorrect:

  1. Run the Colombian Third Party Reverse Balances program.

  2. Correct third party information in the Define Third Parties window. See Maintaining Third Party Information for more information.

  3. Re-run the Colombian Third Party Generate Balances program.

To correct General Ledger and non-Oracle transactions, where master third party information is correct and third party information is incorrect or missing:

  1. Reverse the journal entry.

  2. Re-enter the journal entry with the correct third party assignment.

  3. Re-run the Colombian Third Party Generate Balances program.

To correct subledger transactions, where third party information is correct and master third party information is incorrect:

  1. Correct the third party information in the Define Third Parties window.

  2. Re-run the Colombian Third Party Generate Balances program.

To correct subledger transactions, where master third party information is correct and third party information is incorrect or missing:

  1. Correct the third party information for the transaction in the Supplier, Customer, or Banks window.

  2. Re-run the Colombian Third Party Generate Balances program.

To correct transactions for natural accounts incorrectly marked as third party reportable:

  1. Run the Colombian Third Party Reverse Balances program.

  2. Unmark the natural account as third party reportable in the Third Party Control Accounts window.

  3. Re-run the Colombian Third Party Generate Balances program

    The natural accounts that you unmarked in step 2 are not included in the calculation of third party information.

Program Parameters

Process ID

Enter the Process ID for the program run to reverse. You can find the process ID on the error report of the program run that you want to reverse.

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Colombian Account/Third Party Report

Run the Colombian Account/Third Party report after you run the Colombian Third Party Generate Balances program.

The Colombian Account/Third Party report shows, for each account, all transactions per third party ID in the ledger currency and the associated document numbers.

Use the Standard Request Submission windows to submit the Colombian Account/Third Party report.

Report Parameters

Starting Period

Enter the initial period that you want to report from.

Ending Period

Enter the last period that you want to report to.

Account From

Enter the initial accounting flexfield that you want to report from.

Account To

Enter the last accounting flexfield that you want to report to.

Report Headings

In this heading… General Ledger prints…
<Company Name> The company name
Company Taxpayer ID The company taxpayer ID
Period From The first period in the report
To The last period in the report
Account From The first accounting flexfield included in the report
To The last accounting flexfield included in the report
Report Date The date and time that you ran the report
Currency The ledger currency code
Page The current and total page numbers of the report

Column Headings

In this column… General Ledger prints…
Journal Category The journal entry category
Journal Number The General Ledger document sequence value
Journal Name The journal entry name
Document Number The document number associated to each transaction by account and third party ID
GL Date The accounting date of the transaction
Debit The debit amount in ledger currency
Credit The credit amount in ledger currency

Row Headings

In this row... General Ledger prints...
Account The natural account and its description, and the movements for each third party ID
Third Party ID The third party name and third party ID
Beginning Balance The initial third party balance for the account
Period Total The sum of transaction debits and transaction credits for the period ranges
Ending Balance The final third party balance for the account

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Colombian Third Party/Account Report

Run the Colombian Third Party/Account report after you run the Colombian Third Party Generate Balances program.

The Colombian Third Party/Account report shows, for each third party ID, all transactions per account in the ledger currency and the associated document numbers.

Use the Standard Request Submission windows to submit the Colombian Third Party/Account report.

Report Parameters

Starting Period

Enter the first period that you want to report from.

Ending Period

Enter the last period that you want to report to.

Starting Third Party ID

Enter the first third party ID that you want to report from.

Ending Third Party ID

Enter the last third party ID that you want to report to.

Report Headings

In this heading… General Ledger prints…
<Company Name> The company name
Company Taxpayer ID The company taxpayer ID
Period From The first period in the report
To The last period in the report
Third Party From The first third party ID included in the report
To The last third party ID included in the report
Report Date The date and time that you ran the report
Currency The currency code
Page The current and total page numbers of the report

Column Headings

In this column… General Ledger prints…
Journal Category The journal entry category
Journal Number The General Ledger document sequence value
Journal Name The journal entry name
Document Number The document number associated to each third party ID transaction and account
GL Date The accounting date of transaction
Debit The debit amount in ledger currency
Credit The credit amount in ledger currency

Row Headings

In this row... General Ledger prints...
Third Party ID The third party ID, third party name, and the movements for each natural account
Account The natural account and its description
Beginning Balance The initial account balance for the third party ID
Period Total The sum of transaction debits and credits for period ranges
Ending Balance The end account balance for the third party ID

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Oracle General Ledger

Magnetic Media Reporting

The Colombian government requires large companies to submit magnetic media (electronic ASCII file) to the DIAN at the end of the year. The electronic file reports on third party information for all account movements (transaction totals and to-date balances) according to pre-defined categories.

Each year the Colombian government issues a resolution that defines the reporting categories, sub-categories, and threshold values to include in magnetic media.

A category is called a literal. Each literal has one or more subliterals that identify detailed information related to the literal. For each literal and subliteral, there are one or two reported values to include in the electronic file.

Oracle Financials provides functionality to help you meet the magnetic media requirement for Colombia:

Literal and Subliteral Definition

The literals and subliterals defined by the Colombian government identify specific categories and sub-categories for reporting third party information. Each literal is assigned a two-digit code, and each subliteral a four-digit code (the two-digit literal plus a two-digit sub-code). The exact codes and descriptions can change each year.

For example, the 1997 resolution included the literals and subliterals shown in this table:

Literal Subliteral Description
75   Total or partial Payments
75 00 National or Foreign purchasing of movable assets and others payments
75 01 Salary Expenses
75 07 Purchasing of fixed assets
90   Credits
90 00 National Credits
90 01 Foreign Credits

Some literal and subliteral definitions refer specifically to foreign entities. The internal foreign third party IDs that your company uses to identify foreign entities are not used in the magnetic media report. Foreign entities are identified by the default foreign third party ID (444444444), and foreign third party values are summarized by literal and subliteral. The reported foreign entity name is the same for each literal and subliteral.

Companies are required to report third party values for each literal and subliteral that is greater than or equal to designated threshold values. Threshold values are assigned to both literals and report groupings.

Reported Values

Each subliteral can have one or two values to report, called reported values. Depending on the subliteral, the reported value is either a transaction value or a to-date balance. For example, subliteral 7500 for 1997 (other payments) had two transaction reported values: Base Amount, and VAT Withholding Amount.

Each reported value is assigned a movement type. Movement types identify transaction totals and to-date balances. There are six movement types:

This table shows some of the reported values for literals and subliterals for the 1997 resolution:

Literal Subliteral Description Reported Value Value Description Movement Type
75 00 Payments 1 Accumulated Amount Sum Transactions (Debit - Credit)
75 00 Payments 2 Withholding VAT Sum Transactions (Credit - Debit)
75 01 Payments 1 Accumulated Amount Sum Transactions (Debits - Credits)
72 00 Payments 1 Withholding Sum Transactions (Credit - Debit)
72 00 Payments 2 DeductibleVAT Sum Transactions (Debit - Credit)
90 00 Credits 1 Total Amount Balances (Debit - Credit)
87 00 Liabilities 1 Total Amount Balances (Credit - Debit)

Report Groupings

Each combination of literal, subliteral, and reported value is called a report grouping. For example, the literal and subliteral 7500 for the 1997 resolution has two report groupings:

You associate one or more ranges of existing accounting flexfield segments with each report grouping. The ranges populate the literal, subliteral, and reported values with transaction totals or to-date balances by third party.

You can assign more than one range of accounting flexfield segments to a reported value to make allowances for all possible code combinations. In the example that this table provides, accounting flexfield segment ranges are assigned to the following report grouping: literal 75, subliteral 01, reported value 1 (Accumulated Amount).

Literal Subliteral Report Value Start Account End Account
75 01 1 01.0.510503.0.1 01.9.510503.9.1
75 01 1 01.0.510503.0.3 01.9.510503.9.5
75 01 1 01.0.520503.0.0 01.9.520503.9.9

Threshold Values

The magnetic media resolution by the Colombian government assigns threshold values to literals and report groupings. The threshold values designate the minimum amounts to report per third party ID for each report grouping and for each literal.

The rule for threshold values is:

General Ledger applies thresholds in this sequence:

  1. Parent Report Grouping threshold – General Ledger reports on all parent report groupings greater than or equal to the report grouping threshold value.

  2. Literal threshold – General Ledger adds together all parent report groupings that belong to a literal for each third party ID. If the sum that results meets or exceeds the literal threshold value, the program reports on each parent report grouping even if the value for each parent report grouping by itself is below its report grouping threshold value.

  3. Child Report Grouping level – If a parent report grouping is reported, the children of the report grouping are also reported.

This sequence for applying thresholds means that if a parent report grouping is not reported at the parent report grouping threshold check, General Ledger may still report on the parent report grouping at the literal threshold check.

The setup phase for magnetic media involves entering details for all literals, subliterals, report groupings, ranges of accounting flexfield segments, and threshold values.

You enter magnetic media setup information in the Literals window and Accounts window. See Setting Up Magnetic Media Information for more information.

Setting Up Magnetic Media Information

Complete these setup tasks for magnetic media reporting:

  1. Use the Literals window to define literals, literal threshold values, and subliterals.

  2. Use the Literals window to define reported values for each subliteral, and threshold amounts for parent report groupings.

  3. Use the Accounts window to assign accounting flexfield segment ranges to each report grouping.

  4. Run the Colombian Magnetic Media Literal Configuration Verification Report to verify your magnetic media setup.

Prerequisites

Before you can define literals and subliterals, you must:

Related Topics

Defining Ledgers, Oracle General Ledger User Guide

Defining Literals and Subliterals

Use the Literals window to define literals, subliterals, and report groupings. Use the Literal region in the Literals window to enter the literal or subliteral code, the literal and subliteral, domestic and foreign information, and the literal threshold value, if there is one. Use the Report Grouping region in the Literals window to define report groupings and enter report grouping threshold values.

You enter one or two reported values for each subliteral to create one or two report groupings. Define both parent report groupings and child report groupings. A parent report grouping can have an assigned threshold value. A child report grouping is always assigned to a parent report grouping. The format for a report grouping is XXXX-Y, where:

For each report grouping that you define, use the Accounts button in the Define Literals window to navigate to the Accounts window to assign accounting flexfield ranges to the report grouping. See Assigning Ranges of Accounting Flexfield Segments Assigning Ranges of Accounting Flexfield Segments for more information.

To define a literal:

  1. Navigate to the Literals window.

  2. In the Literal Code field, enter the two-digit literal code.

  3. In the Reported Year field, enter the current year.

  4. For domestic or foreign literals, enter the description in the Description field. For foreign literals, enter the description as defined by the DIAN in the Foreign Description field.

    Note: If you enter a description in the Foreign Description field, the Foreign Reported check box is checked automatically.

  5. Check the appropriate Reported check boxes, if not already checked.

  6. If you are reporting on third party transactions according to a threshold value for the literal, check the appropriate Threshold check box.

  7. If the literal has a threshold value, enter the value in the Threshold Value field. If there is no threshold value, leave the field blank.

    Note: Make sure that you have checked the appropriate Threshold check boxes.

  8. Save your work.

To define a subliteral and report grouping:

  1. Navigate to the Literals window.

  2. In the Literal Code field, enter the four-digit subliteral code.

    Note: Define the literal first before you define the corresponding subliterals.

  3. In the Reported Year field, enter the current year.

  4. For domestic or foreign subliterals, enter the description in the Description field. For foreign subliterals, enter the description as defined by the DIAN in the Foreign Description field.

  5. Check the appropriate Reported check boxes, if not already checked.

  6. If you are reporting on third party transactions according to a threshold value for the subliteral, check the appropriate Threshold check box.

  7. Navigate to the Report Grouping region.

  8. In the Reported Value field, enter the one-digit code (1 or 2) for the reported value for the report grouping.

  9. In the Description field, enter the description of the reported value as defined by the DIAN.

  10. In the Movement Type field, enter the movement type for the report grouping, such as Sum Transactions Debit-Credit or Balances Debit-Credit.

  11. If the report grouping is a parent report grouping with threshold value, enter the threshold value in the Threshold Value field.

    Note: If you enter a value in this field, leave the Parent field blank. You only use the Parent field for child report groupings.

  12. If the report grouping is a child report grouping, enter the parent report grouping in the Parent field.

  13. Save your work.

Assigning Ranges of Accounting Flexfield Segments

Use the Accounts window to assign accounting flexfield segment ranges to each report grouping defined in the Literals window.

The accounting flexfield segment ranges in the Accounts window represent your chart of accounts. You can enter more than one range of accounting flexfield segments for a report grouping to allow for all possible code combinations.

Note: If you enter more than one range of accounting flexfield segments, the ranges must not overlap.

To assign ranges of accounting flexfield segments to a report grouping:

  1. Navigate to the Literals window.

  2. Query or define the subliteral that you want.

  3. Navigate to the Report Grouping region.

  4. Query or define the reported value that you want.

  5. Navigate to the Accounts window by pressing the Accounts button.

  6. Enter the start and end accounting flexfield segment ranges in the From and To fields. Enter all ranges that apply to the report grouping.

    Note: The list of values for accounting flexfield segment ranges represents your chart of accounts.

  7. Save your work.

Colombian Magnetic Media Literal Configuration Verification Report

The Colombian Magnetic Media Literal Configuration Verification report generates a listing of the magnetic media setup information. Run the report after you set up magnetic media information for the current year.

The Colombian Magnetic Media Literal Configuration Verification report shows literals, subliterals, descriptions, reported values, threshold values, parent/child relationships, movement types, ranges of accounting flexfield segments assigned to each report grouping, and magnetic media status for each literal and subliteral. Use the report to verify the completeness and accuracy of the magnetic media setup.

The magnetic media status indicates the processing level for each literal and subliteral. You can only run the Colombian Magnetic Media Generate File program to generate the magnetic media ASCII file when all literals and subliterals have the status of Processed by Threshold which means that the Colombian Magnetic Media Apply Thresholds program was run for all literals and subliterals.

Use the Standard Request Submission windows to submit the Colombian Magnetic Media Literal Configuration Verification report.

Report Parameters

Report Year

Enter the year that you want to report.

Starting Literal Code

Enter the first literal or subliteral that you want to report from.

Ending Literal Code

Enter the last literal or subliteral that you want to report to.

Magnetic Media Status

Enter the magnetic media status to report for literals or subliterals. If you do not enter a value, the report includes all literals and subliterals within the specified range. Enter one of the following:

Report Headings

In this heading… General Ledger prints…
Reported Year The reported year
Literal Start The first literal or subliteral to report
End The last literal or subliteral to report
Magnetic Media Status The magnetic media status to report
Report Date The date and time that you ran the report
Page The current and total page numbers of the report

Column Headings

In this column… General Ledger prints…
Literal The literal or subliteral code
Reported Value The subliteral reported value
Description The literal, subliteral, or reported value description
Threshold Value The literal or report grouping threshold value
Parent The parent report grouping (child report groupings only)
Movement Type The movement type for the report grouping
Account Start/Account End The first and last accounting flexfield segment for the report grouping
Magnetic Media Status The magnetic media status for each literal and subliteral

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Generating the Magnetic Media File

After you set up and verify the completeness and accuracy of magnetic media information, you can generate the magnetic media file. Generating the electronic file involves accessing third party transaction information and organizing the information according to literal/subliteral definitions. The Colombian Magnetic Media Generate File program writes the information to the electronic file.

Note: As the magnetic media file does not meet the current fiscal year's format nor the requirement to have one XML file for each Literal, it is recommended that you use the current magnetic media file as a template for further customizations.

To create the magnetic media file:

  1. Run the Colombian Magnetic Media Get Movements program to get movements of third party accounting flexfield segment ranges.

  2. Use the Colombian Magnetic Media Literals, Accounts and Third Party Movement report to print and review range accounts, third parties, and literal movements.

  3. Run the Colombian Magnetic Media Apply Thresholds program to mark movements greater than or equal to threshold values.

  4. Use the Colombian Magnetic Media Literals and Third Party Movement report to print and review third party and literal reported movements.

  5. Run the Colombian Magnetic Media Generate File program to generate the ASCII file to send to the DIAN.

You can run the magnetic media file generation process as often as you need to produce an accurate report, as long as General Ledger is not permanently closed. When General Ledger is permanently closed, the next run of the magnetic media file generation process is the final run.

These are the programs and reports that manage magnetic media file generation:

Colombian Magnetic Media Get Movements Program

Use the Colombian Magnetic Media Get Movements program to collect literal and third party movement information for each literal, subliteral, and reported value, using the accounting flexfield segment ranges.

The Colombian Magnetic Media Get Movements program is the first program to run in the generation of the magnetic media file.

After you run the Colombian Magnetic Media Get Movements program, run and review the Literals, Accounts and Third Party Movements report. See Colombian Magnetic Media Literals, Accounts and Third Party Movement Report for more information.

Navigate to the Magnetic Media Programs window to run the Colombian Magnetic Media Get Movements program.

Program Parameters

Reported Year

Enter the year that you want to report.

Period Start

Enter the first fiscal period that you want to report from.

Period End

Enter the last fiscal period that you want to report to.

Literal Start

Enter the first literal or subliteral that you want to report from.

Literal End

Enter the last literal or subliteral that you want to report to.

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Colombian Magnetic Media Apply Thresholds Program

Use the Colombian Magnetic Media Apply Thresholds program to collect literal and third party information to report.

Run the Colombian Magnetic Media Apply Thresholds program after you run the Colombian Magnetic Media Get Movements program and after you run and review the Literals, Accounts and Third Party Movements report.

You can only run the Colombian Magnetic Media Generate File program after you have run the Colombian Magnetic Media Apply Thresholds program for all literals and subliterals. You can use the Colombian Magnetic Media Literal Configuration Verification report to check the status of literals and subliterals. See Colombian Magnetic Media Literal Configuration Verification Report for more information.

After you run the Colombian Magnetic Media Apply Thresholds program, run the Colombian Magnetic Media Literals and Third Party Movement report. See Colombian Magnetic Media Literals and Third Party Movement Report for more information.

To navigate to the Colombian Magnetic Media Apply Thresholds program, use Colombian General Ledger: Colombian Localization > Magnetic Media Programs. Use the Standard Request Submission windows to submit the Colombian Magnetic Media Apply Thresholds program.

Program Parameters

Reported Year

Enter the year that you want to report.

Literal Start

Enter the first literal or subliteral that you want to report from.

Literal End

Enter the last literal or subliteral that you want to report to.

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Colombian Magnetic Media Generate File Program

Use the Colombian Magnetic Media Generate File program to generate the ASCII file that you submit to the DIAN.

You must run the Colombian Magnetic Media Apply Thresholds program before you can run the Colombian Magnetic Media Generate File program. You should also run and review the Colombian Magnetic Media Literals and Third Party Movement report.

As specified by the Colombian government, the file has three registers:

Navigate to the Magnetic Media Programs window to run the Colombian Magnetic Media Generate File program.

Program Parameters

Reported Year

Enter the year that you want to report.

Diskette or Tape Label

Enter the label to identify the tape or diskette that contains the magnetic media file.

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Colombian Magnetic Media Literals, Accounts and Third Party Movement Report

The Colombian Magnetic Media Literals, Accounts and Third Party Movement report prints, for each literal and subliteral, accounts and third party transactions by report grouping. The report includes all literals and subliterals.

You can use the report to compare account totals with General Ledger account balances, and correct any discrepancies.

Run this report after you run the Colombian Magnetic Media Get Movements program.

The Colombian Magnetic Media Literals, Accounts and Third Party Movement report shows the literal or subliteral code, reported value, initial and end range of accounting flexfield segments, third party ID, third party name, and reported values.

Use the Standard Request Submission windows to submit the Colombian Magnetic Media Literals, Accounts and Third Party Movement report.

Report Parameters

Reported Year

Enter the year that you want to report.

Literal Start

Enter the first literal or subliteral that you want to report from.

Literal End

Enter the last literal or subliteral that you want to report to.

Report Headings

In this heading… General Ledger prints…
Company Taxpayer ID Company Taxpayer ID
Reported Year Reported year
Literal Start First literal or subliteral to report
Literal End Last literal or subliteral to report
Date Date and time that you ran the report
Page Current and total page numbers of the report

Column Headings

In this column… General Ledger prints…
Literal Subliteral code
RV Reported value
Initial Account First accounting flexfield segment for the report grouping
End Account Last accounting flexfield segment for the report grouping
Third Party ID Third party ID associated with the movement
Type Third party identification type
Name Third party name
First Value First reported value
Second Value Second reported value

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Colombian Magnetic Media Literals and Third Party Movement Report

The Colombian Magnetic Media Literals and Third Party Movement report prints third party and literal movements. Run the report after you run the Colombian Magnetic Media Apply Thresholds program.

The Colombian Magnetic Media Literals and Third Party Movement report shows literal and subliteral code, reported value, third party ID, third party name, first reported value, and second reported value.

Use the Standard Request Submission windows to submit the Colombian Magnetic Media Literals and Third Party Movement report.

Report Parameters

Reported Year

Enter the year that you want to report.

Literal Start

Enter the first literal or subliteral that you want to report from.

Literal End

Enter the last literal or subliteral that you want to report to.

Report Headings

In this heading… General Ledger prints…
Company Taxpayer ID Company Taxpayer ID
Reported Year Reported year
Literal Start First literal or subliteral to report
Literal End Last literal or subliteral to report
Date Date and time that you ran the report
Page Current and total page numbers of the report

Column Headings

In this column... General Ledger prints...
Literal Subliteral code
Third Party ID Third party ID associated with the movement
Third Party Type Third party identification type
Name Third party name
First Value First reported value
Second Value Second reported value

Row Headings

In this row… General Ledger prints…
Total Subliteral Sum of first reported values and sum of the second reported values for each subliteral
Total Report Sum of first reported values and sum of the second reported values for the report
Total of First and Second Values Sum of first and second reported values for the report
Total Records Reported record count

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Setting Up the Unique Chart of Accounts

In Colombia, companies are legally required to use a unique chart of accounts (Plan Unico de Cuentas or PUC) defined by the government. Different business sectors, such as the commercial, financial, or government sectors, have different unique charts of accounts.

The Colombian government defines four levels of accounts within the commercial Unique Chart of Accounts:

For example, the commercial Unique Chart of Accounts uses these one-digit initial codes to identify the classes of accounts.

Other codes identify accounts at lower account levels.

Note: Oracle General Ledger for Colombia uses the number of digits in the account number to identify the level of the account. The Level field in the Segment Values window is not used for Colombian account levels.

To establish the legal hierarchy of account levels for your accounts, create parent-child relationships between accounts at different levels. Define level 4 accounts as children of level 3 accounts, level 3 accounts as children of level 2 accounts, and level 2 accounts as children of level 1 accounts.

You should set the Allow Posting segment qualifier to Yes for all accounts at level 4. General Ledger automatically maintains account balances for the accounts that allow posting.

Maintaining account balances for the higher-level accounts speeds the processing of reports on account activity at these levels, since General Ledger does not need to calculate the account balances when the report is generated. To maintain account balances for accounts at levels 1, 2, and 3, create summary accounts for these accounts. You can create summary accounts by defining a rollup group for each account level, assigning parent accounts to the appropriate rollup groups, and creating summary templates using the rollup groups.

In Colombia, companies must report account information according to the legal account levels. Companies must be able to list account information at each level of account detail.

In Oracle General Ledger for Colombia, a legal report at a particular account level shows detailed information for accounts at that level as well as totals for accounts at each higher level. For example, a report at level 3 shows detailed information for level 3 accounts as well as summary totals for level 2 accounts and level 1 accounts. For more information, see the General Ledger Journal and Balance report, General Ledger Inventory and Balances Book report, and General Ledger Trial Balance report in the Oracle General Ledger User Guide.

Example for Colombian legal account levels

Assume that a company needs to set up accounts using the commercial Unique Chart of Accounts with the four legal account levels.

The company defines segment values for the account segment of the accounting flexfield. This table lists some examples of accounts and shows whether the account is a parent value or a child value and which rollup group each parent value should belong to.

Account Number Description Parent/Child Rollup Group
1 Asset Parent Class
11 Available Parent Group
1105 Cash Parent Account
110505 General Cash Child  
1110 Banks Parent Account
111005 National Bank Child  

The company also defines the child ranges for the parent accounts. This table shows some examples of the child ranges defined for parent accounts at the various account levels.

Account Number Account Level Child Range From Child Range To Included Values
1 1 11 11 Parent Values Only
1 1 12 12 Parent Values Only
1 1 13 13 Parent Values Only
1 1 14 14 Parent Values Only
1 1 15 15 Parent Values Only
1 1 16 16 Parent Values Only
1 1 17 17 Parent Values Only
1 1 18 18 Parent Values Only
1 1 19 19 Parent Values Only
11 2 1105 1105 Parent Values Only
11 2 1110 1110 Parent Values Only
11 2 1115 1115 Parent Values Only
11 2 1120 1120 Parent Values Only
11 2 1125 1125 Parent Values Only
1105 3 110500 110599 Child Values Only

The company defines the rollup groups for the three upper account levels, as shown in this table:

Rollup Group Name Account Level
Class 1
Group 2
Account 3

Note: The subaccount level, level 4, does not need a rollup group since General Ledger automatically maintains account balances for accounts that allow posting.

Finally, the company defines the summary templates to create summary accounts for the upper account levels, as shown in this table. For this example, assume that the accounting flexfield consists of four segments, the first of which is the balancing segment and the second of which is the account segment.

Name Template Description
Class D.CLASS.T.T Level 1 Accounts
Group D.GROUP.T.T Level 2 Accounts
Account D.ACCOUNT.T.T Level 3 Accounts

The summary templates should use the rollup groups as the template values for the natural account segment. General Ledger uses these templates to create a summary account for each parent value assigned to the rollup groups. The balance of each summary account is the total of the balances of all the child accounts associated with the parent.

Related Topics

Defining Summary Accounts, Oracle General Ledger User Guide

Parent and Child Values and Rollup Groups, Oracle General Ledger User Guide

Oracle Payables

Withholding Tax Overview

In Colombia, customers who are withholding agents are responsible for withholding taxes from supplier invoices, credit memos, and debit memos when the supplier is subject to withholding and is not a withholding agent. The customer pays the supplier invoice net the withheld amount and issues a withholding certificate for the withheld amount. The customer pays the supplier invoice net the withheld amount as well as the tax withheld to the proper tax authority.

Several types of withholding tax can be levied on a single invoice line. The withholding tax types include:

Each domestic invoice has one or more associated taxpayer ID (NIT). The taxpayer ID is used to help calculate and report withholding activity to tax authorities.

Oracle Payables for Colombia calculates withholding tax during the document approval process based on:

This section describes the features of each withholding tax and how to set up Oracle Payables for Colombia to calculate withholding tax as well as withholding certificates that show your withheld tax amounts for your supplier.

Note: Oracle Payables for Columbia does not create offsetting accounting entries for withholding tax.

Note: Oracle Payables for Colombia does not support withholding on prepayments.

Note: The Oracle Payables for Colombia withholding tax solution, which is an extension of the Oracle Payables Automatic Withholding Tax functionality, has its own setup and does not require the use of withholding tax groups.

Withholding Tax and Calculation

This section describes the features and calculation method for each withholding tax type. These withholding taxes are:

Oracle Payables for Colombia lets you define applicable withholding taxes by setting up the features described in this table:

Set up this Oracle feature… For this purpose…
Tax Types Define the types of withholding taxes that apply and their attributes
Tax Codes Define the concepts, rates, and specific attributes for withholding taxes
Cities Define cities where withholding taxes are applicable
Company Withholding Applicability Specify if you are a withholding agent for each tax type
Supplier Withholding Applicability Associate each supplier with applicable tax types and tax codes

When you enter a document, Oracle Payables for Colombia assigns default withholding tax codes to each applicable document distribution line based on the information that you defined for your company and supplier. You can change or delete the default taxes for a document before the withholding amounts are calculated with some restrictions.

Oracle Payables for Colombia calculates withholding taxes on documents as part of the document approval process:

Income Tax Withholding

Income tax is a national tax that individuals and legal entities pay for income obtained during the year. In Colombia, the customer withholds income tax on behalf of the supplier and pays it directly to the proper tax authorities. Income tax withholding is applicable for domestic and foreign suppliers when you are an income tax withholding agent and the supplier is subject to income tax withholding from you.

The income tax withholding amount is calculated on the taxable base for each income concept within a document. The taxable base is established based on the sum of all distribution line amounts that are associated with the same tax code and taxpayer ID on a document. You define the income concept, the minimum amount, and the rate for each tax code.

Income tax withholding is calculated with this formula:

(taxable base amount) * (tax code rate)

If a minimum taxable base amount is associated with an income concept, income tax withholding is only calculated for the income concept when the taxable base amount is greater than or equal to the minimum taxable base amount.

If a minimum withheld amount is associated with the concept at either tax code level or withholding type level, the calculated withholding amount must be greater than or equal to the minimum withheld amount for withholdings to apply. Withholding distribution lines are created as part of the document approval process if they apply.

The income tax withholding certificate that you send to your supplier summarizes income tax withholding details.

VAT Withholding

Value Added Tax (VAT), a tax charged on the value added to goods or services at each stage of their supply, is withheld by the customer on behalf of the supplier. VAT withholding applies for domestic and foreign suppliers when you are a VAT withholding agent and the supplier is subject to VAT withholding from you.

The VAT withholding amount is calculated on the taxable base for each concept within a document. The taxable base is established based on the sum of all distribution line amounts that are associated with the same tax code and taxpayer ID on a document. You define the concept and the withholding rate for each tax code. Currently, no minimum taxable base amount is used for VAT withholding.

VAT withholding is calculated with this formula:

(taxable base amount) * (tax code rate)

If a minimum withheld amount is associated with the concept at either tax code level or withholding type level, the calculated withholding amount must be greater than or equal to the minimum withheld amount for withholdings to apply. Withholding distribution lines are created as part of the document approval process if they apply.

The VAT withholding certificate that you send to your supplier summarizes VAT withholding details.

Industry and Trade Tax Withholding

Industry and trade tax withholding is the withholding of industry and trade tax on behalf of the supplier. Industry and trade tax withholding applies for domestic and foreign suppliers when these conditions apply:

The industry and trade tax withholding amount is calculated on the taxable base for each concept by city within a document. The taxable base is established based on the sum of all distribution line amounts that are associated with the same tax code and taxpayer ID on a document. Each city that levies industry and trade tax has its own industry and trade tax type with its own tax codes and associated rates within this tax type.

The industry and trade tax withholding is calculated using this formula:

(taxable base amount) * (tax code rate)

If a minimum taxable base amount is associated with a concept, industry and trade tax withholding is only calculated for the concept when the taxable base amount is greater than or equal to the minimum taxable base amount.

If a minimum withheld amount is associated with the concept at either tax code level or withholding type level, the calculated withholding amount must be greater than or equal to the minimum withheld amount for withholdings to apply. Withholding distribution lines are created as part of the document approval process if they apply.

The industry and trade tax withholding certificate that you send to your supplier summarizes the industry and trade tax withholding details.

Remittance Tax Withholding

Remittance tax withholding is the withholding of remittance tax on behalf of a foreign supplier. Remittance tax withholding applies for foreign suppliers when you are a remittance tax withholding agent and the supplier is subject to remittance tax withholding from you.

The taxable base amount for remittance tax withholding is calculated with a specific formula that you define for each concept. See Remittance Tax Formulas for examples. The taxable base is established based on the sum of all distribution line amounts that are associated with the same tax code and taxpayer ID on a document. You associate a concept with each tax code and you define the concept attributes that are used to determine which formula is used. In addition, you define the withholding rate for each tax code.

Currently, no minimum taxable base amount is used for remittance tax withholding.

If a minimum withheld amount is associated with the concept at either tax code level or withholding type level, the calculated withholding amount must be greater than or equal to the minimum withheld amount for withholdings to apply. Withholding distribution lines are created as part of the document approval process if they apply.

The remittance tax withholding certificate that you send to your supplier summarizes the remittance tax withholding details. The base amount printed on the certificate is the calculated amount before the tax code withholding rate is applied in each formula.

Remittance Tax Formulas

This table shows examples of formulas by concept and the withholding rates that the Colombian government currently assigns to the concepts.

Concept Calculation Method Withholding Rate
Interest, commissions, and professional fees (Concept taxable base amount - ((Concept taxable base amount * Income Tax %) + VAT withholding + Industry and Trade withholding + Stamp tax)) * concept withholding rate. 7%
Technical services (Concept taxable base amount - Stamp tax) * concept withholding rate 10%
Movies exploitation ((Concept taxable base amount - ((Concept taxable base amount * Income Tax %) + VAT withholding + Industry and Trade withholding + Stamp tax)) * special reduction percentage) * concept withholding rate 7%
Software exploitation ((Concept taxable base amount - ((Concept taxable base amount * Income Tax %) + VAT withholding + Industry and Trade withholding + Stamp tax)) * special reduction percentage) * concept withholding rate 7%
Other payments (Concept taxable base amount - Stamp tax) * concept withholding rate 1%

Stamp Tax Withholding

Stamp tax withholding is the withholding of stamp tax on behalf of a supplier. Stamp tax withholding can apply for domestic or foreign suppliers when you are a stamp tax withholding agent and the supplier is subject to stamp tax withholding. If stamp tax applies to a contract, a customer and a supplier can negotiate who pays what percentage of the standard rate.

The stamp tax withholding amount is calculated on the taxable base. The taxable base is established based on the sum of all distribution line amounts that are associated with the same tax code and taxpayer ID on a document. Generally, a stamp tax withholding type has only one concept. You must define a different tax code for each distinct rate that must apply. You should not define a minimum taxable base amount or minimum withheld amount for stamp tax withholding.

Stamp tax withholding is calculated using this formula:

(taxable base amount) * (tax code rate)

Stamp tax withholding is calculated and stamp tax withholding distribution lines are created for document lines that apply when a document is approved.

The stamp tax withholding certificate that you send to your supplier summarizes the stamp tax withholding details.

Setting Up Withholding Tax

This section describes how to set up Oracle Payables for Colombia for withholding tax handling. Complete the setup steps in this order:

Step Setup Task
1 Enable extended automatic withholding tax calculation
2 Define Payables options
3 Define suppliers and supplier sites
4 Define lookup codes
5 Define locations
6 Define tax withholding types
7 Define tax codes and rates
8 Define your withholding applicability
9 Define your supplier's withholding applicability

Enable Extended Automatic Withholding Tax Calculation

Enable extended automatic withholding tax calculation by setting the JG: Extended AWT Calculation profile option to Yes for your Oracle Payables responsibility. Use the System Profile Values window in the System Administrator responsibility to define the JG: Extended AWT Calculation profile option.

Related Topics

Overview of Setting User Profiles, Oracle Applications System Administrator's Guide

Define Payables Options

Use the Payables Options window to enable tax withholding and set control options and defaults that are used for withholding taxes.

To define Payables options for withholding taxes:

  1. Navigate to the Payables Options window.

  2. Navigate to the Withholding Tax tabbed region.

  3. Check the Use Withholding Tax check box.

  4. Choose At Invoice Approval Time in the Apply Withholding Tax region.

  5. Check the Include Discount Amount check box in the Withholding Amount Basis region.

  6. Choose the Never option in the Create Withholding Invoice region.

  7. Save your work.

Related Topics

Payables Options, Oracle Payables User Guide

Define Suppliers and Supplier Sites

Use the Suppliers window to define suppliers and tax authorities. Use the globalization flexfield in this window to define the taxpayer ID validation digit used to validate the taxpayer ID. The taxpayer ID is used for the withholding tax process and reporting purposes.

Use the globalization flexfield in the Supplier Sites window to define a legal address for a supplier. You can only define one site as a legal address site. The legal address is printed on withholding certificates that are created for a supplier.

Prerequisites

Before you use the globalization flexfield in the Suppliers window, you must:

To define suppliers:

  1. Navigate to the Suppliers window.

  2. Enter or query a supplier.

    Note: Leave the Number field blank so that Oracle Payables for Colombia can automatically copy the taxpayer ID that you enter in the Taxpayer ID field into this field. If you enter a supplier's number in the Number field, Oracle Payables for Colombia does not overwrite the number with the taxpayer ID.

  3. Enter the taxpayer ID without the hyphen or validation digit in the Taxpayer ID field. Enter a unique number for foreign entities.

  4. Navigate to the globalization flexfield.

  5. Enter either Individual, Legal Entity, or Foreign Entity for the supplier's identification type in the Taxpayer ID Type field. The default identification type is Legal Entity.

  6. If you entered a Legal Entity identification type, then enter the taxpayer ID validation digit in the Taxpayer ID Validation Digit field. Leave this field blank for an Individual or Foreign Entity identification type.

  7. Press the OK button.

    The taxpayer ID and its validation digit are copied into the Number field in the Suppliers window if there are no errors.

  8. If the supplier is a tax authority, navigate to the Classification tabbed region.

  9. Enter Tax Authority in the Type field.

  10. Navigate to the Sites tabbed region.

  11. Select a site for the supplier's legal address and press the Open button.

    The Supplier Sites window appears

  12. Navigate to the globalization flexfield.

  13. Enter Yes in the Legal Address field if you want the site address to appear on withholding certificates.

  14. Press the OK button.

  15. Save your work.

Related Topics

Supplier Entry Financials Options, Oracle Payables User Guide

Overview of Setting User Profiles, Oracle Applications System Administrator's Guide

Entering Suppliers, Oracle Payables User Guide

Define Lookup Codes

Use the Lookups window to define lookup codes for cities and tax authority categories. Lookup codes are codes that you create and associate with predefined lookup types. The lookup types determine specific transaction elements that run in Oracle Payables for Colombia. You can select lookup codes from the lists of values after you have defined the lookup codes.

Defining City Lookup Codes

Define lookup codes for cities that are associated with ship-to locations, bill-to locations, and payment cities. Use the city lookup codes when you define tax types, locations, and your withholding applicability.

To define city lookup codes:

  1. Navigate to the Lookups window.

  2. Enter or query JLZZ_CITY as the lookup type in the Type field.

  3. Enter Latin America Localizations in the Application field.

  4. Enter City in the Description field.

  5. Enter a unique lookup code for the lookup type in the Code field.

  6. Enter the city's name for the lookup code in the Meaning field.

  7. Enter dates that you want the lookup code to be entered in the From and To fields. The default date in the From field is the current date.

  8. Check the Enabled check box to enable the lookup code for data entry.

  9. Repeat steps 5 to 8 for each lookup code that you define for the lookup type.

  10. Save your work.

Defining Tax Authority Category Lookup Codes

Define lookup codes for tax authority categories that represent the concepts for each tax type. Use the tax authority category lookup codes to associate a category with each tax code when you define tax codes.

To define tax authority category lookup codes:

  1. Navigate to the Lookups window.

  2. Enter or query JLCO_TAX_AUTHORITY_CATEGORY as the lookup type in the Type field.

  3. Enter Latin America Localizations in the Application field.

  4. Enter Colombian tax authority category in the Description field.

  5. Enter a unique lookup code for the lookup type in the Code field.

  6. Enter a unique tax authority category, such as Services, for the lookup code in the Meaning field.

  7. Enter a description of the tax authority category in the Description field.

  8. Enter dates that you want the lookup code to be entered in the From and To fields. The default date in the From field is the current date.

  9. Check the Enabled check box to enable the lookup code for data entry.

  10. Repeat steps 5 to 9 for each lookup code that you define for the lookup type.

  11. Save your work.

Related Topics

Lookups, Oracle Payables User Guide

Define Locations

Use the Location Address flexfield in the Location window to define additional address information for your company's locations. The city that you specify for each location's address is used to determine the taxes that apply to each document.

For your company's primary location, use the Legal Entity Configurator to enter your company's taxpayer ID and validation digit. The taxpayer ID is used to report withholding activity to tax authorities.

To define locations:

  1. Navigate to the Location window.

  2. Enter or query a location.

  3. In the Address Details tabbed region, enter Colombia in the Address Style field.

    The Location Address flexfield automatically appears.

  4. Enter your street address in the Address Line 1, 2, and 3 fields.

  5. Enter your neighborhood in the Neighborhood field.

  6. Enter your city in the City field.

  7. Enter your state in the State field.

  8. Enter your postal code in the Postal Code field.

  9. Enter your telephone area code in the Area Code field.

  10. Enter your telephone number in the Telephone field.

  11. Enter your fax number in the Fax field.

  12. Enter your internet address in the Internet Address field.

  13. Press the OK button.

  14. Navigate to the Shipping Details tabbed region and enter the location name in the Ship To Location field.

  15. Save your work.

  16. Navigate to the globalization flexfield.

  17. Enter your organization class in the Organization Tax Class field. Leave the Tax Code field blank.

  18. Enter the legal name of your company in the Company Name field.

  19. Enter your alternate company name in the Alternate Company Name field.

  20. Enter your taxpayer ID in the Primary ID Number field.

  21. Enter the taxpayer ID's validation digit in the Primary ID Validation Digit field.

  22. Enter your city code in the City Code field.

  23. Enter your economic activity code in the Economic Activity code field.

  24. Press the OK button.

  25. Save your work.

Related Topics

Defining Legal Entities Using the Legal Entity Configurator, Oracle Financials Implementation Guide

Setting Up Locations, Oracle HRMS Enterprise and Workforce Management Guide

Define Tax Withholding Types

Use the Withholding Tax Types window to define tax withholding types and associated attributes, such as the jurisdiction type and tax authority. Tax withholding calculation is based on attributes that you define for the withholding tax type and tax code.

Prerequisites

Before you can use the Withholding Tax Types window, you must:

To define tax withholding types:

  1. Navigate to the Withholding Tax Types window.

  2. Enter or query a unique withholding tax type code, such as one of the examples shown in this table, for the withholding tax in the Withholding Tax Type Code field. For industry and trade tax, a distinct withholding tax type is required for each city. You should include the city's name in your industry and trade tax codes.

    For this tax withholding type… Enter this tax code…
    Income tax INC
    VAT VAT
    Industry and Trade/Cali ITT_CALI
    Remittance REM
    Stamp STA

  3. Enter a description for the tax withholding type in the Description field.

  4. Check the Applicable to Foreign Suppliers check box if the tax withholding type applies to foreign suppliers.

  5. Choose the jurisdiction type, either Municipal for industry and trade tax or Federal for the other withholding taxes in the Jurisdiction Type field.

  6. Choose Invoice as the basis that the taxable base amount is calculated on in the Taxable Base Amount Basis field.

  7. Choose whether the minimum taxable amount is handled by Category or is Not Applicable in the Minimum Taxable Amount Level field.

  8. Choose whether a minimum withheld amount is compared to the withheld amount for either a Withholding Type, Category, or is Not Applicable in the Minimum Withheld Amount Level field.

  9. Enter the minimum withheld amount in the Minimum Withheld Amount field if the minimum withheld amount is compared at withholding type level.

  10. Enter the tax authority, such as DIAN, for the withholding tax type in the Tax Authority field.

  11. Enter text that will appear as the header of the certificate for the withholding type, such as Income Tax Withholding Certificate, in the Certificate Header Text field.

  12. Enter a Colombian city in the City field if the jurisdiction type is municipal.

  13. Check the User-Defined Formula check box if the withholding tax type is remittance.

  14. Save your work.

Related Topics

Entering Suppliers, Oracle Payables User Guide

Define Tax Codes and Rates

Use the globalization flexfield in the Tax Codes window to define additional information for withholding tax codes, such as the withholding type and tax authority category.

You associate a withholding tax type with each tax code that you define. The withholding tax type generates default attributes for the tax code. In most cases, you can change the default attributes as required by the tax code definition.

You can associate a withholding tax type with more than one tax code. In general, you need to create a unique tax code within a withholding tax type whenever different rates or attributes apply.

For each tax code, you can choose any combination of item, freight, miscellaneous, and tax as the applicable document line type amounts used in the withholding tax calculation. You should not associate withholding tax codes, including VAT withholding tax codes, with tax line types. If you associate a user-defined formula with a withholding tax type, such as remittance tax, enter the income tax rate, special reduction rate, and withholding tax types that are used in the formula.

Note: If a VAT tax rate changes, create a new tax code for the new rate instead of changing the original rate so that your withholding certificate displays the correct historical tax information.

Prerequisites

Before you can use the Tax Codes window, you must:

To define additional information for withholding tax codes:

  1. Navigate to the Tax Codes window.

  2. Enter or select a tax code in the Tax Code field. You should indicate the withholding type and category in the tax code, such as INC_GOODS.

  3. Enter Withholding Tax in the Tax Type field.

    Note: After you define a tax code, fill in the information in the globalization flexfield in the Tax Codes window. Use the Withholding Tax Details window to define and maintain withholding information for tax rates related to tax codes. If you change any information in the globalization flexfield in the Tax Codes window, Payables clears the tax authority name in the Withholding Tax Details window.

  4. Navigate to the globalization flexfield.

  5. Enter a withholding tax type to associate with the tax code in the Withholding Type field.

  6. Enter a tax authority category that identifies the concept associated with the tax code in the Tax Authority Category field.

  7. Enter Yes in the Foreign Rate Indicator field if the tax code applies to foreign suppliers. Enter No if the tax code only applies to domestic suppliers.

  8. Enter Yes in the Item Line Type Applicability field if the item line type forms part of the taxable base amount that can be used to calculate withholding taxes. Otherwise enter No.

  9. Enter Yes in the Freight Line Type Applicability field if the freight line type forms part of the taxable base amount that can be used to calculate withholding taxes. Otherwise enter No.

  10. Enter Yes in the Miscellaneous Line Type Applicability field if the miscellaneous line type forms part of the taxable base amount that can be used to calculate withholding taxes. Otherwise enter No.

  11. Enter Yes in the Tax Line Type Applicability field if the tax line type forms part of the taxable base amount that can be used to calculate withholding taxes. Otherwise enter No.

  12. Enter the minimum taxable base amount in the Minimum Taxable Base Amount field if a minimum taxable base amount is defined at category level by the withholding tax type associated with the tax code.

  13. Enter the minimum withheld amount in the Minimum Withheld Amount field if a minimum withheld amount is defined at category level by the withholding tax type associated with the tax code.

  14. Enter the income tax rate that is used in the formula in the Income Tax Rate field.

  15. Enter the first federal withholding tax type that is used in the formula in the First Tax Type field.

  16. Enter the second federal withholding tax type that is used in the formula in the Second Tax Type field, if applicable.

  17. Enter Yes in the Municipal Tax Type field if all municipal withholding tax types are used in the formula. Enter No if municipal withholding tax types are not used in the formula.

  18. Enter the percentage for special reductions that are used in a formula in the Reduction Percentage field.

  19. For VAT withholding tax codes, enter the VAT withholding legal rate that is required to be printed on the withholding certificate in the Reported Tax Rate field.

  20. Press the OK button.

  21. Press the Withholding Tax Details button.

    The Withholding Tax Details window appears.

  22. Enter the tax authority in the Tax Authority field.

  23. Enter Gross Amount in the Amount Basis field.

  24. Enter Invoice in the Period Basis field.

  25. Uncheck the Create Tax Group check box.

  26. Save your work.

Define Your Withholding Applicability

Use the Company Withholding Applicability window to set your withholding agent status for each withholding tax type. Before a tax code is associated with a distribution line, Oracle Payables for Colombia verifies that you are a withholding agent for that tax.

You need to define applicability only for your company's primary location. The same withholding applicability will apply to all locations within an organization.

Prerequisites

Before you can use the Company Withholding Applicability window, you must:

To define your withholding applicability:

  1. Navigate to the Company Withholding Applicability window.

  2. Enter your company's primary location that is associated with your organization in the Location field.

    A description of the location appears in the Description field.

  3. Enter a withholding tax type code in the Withholding Tax Type field.

    A description of the withholding tax type appears in the Description field.

  4. Check the Agent Indicator check box if you are a withholding agent for the withholding tax.

  5. In the Payment City field, enter the city where the withholding tax is paid.

  6. Save your work.

  7. Repeat steps 3-5 for each withholding tax type.

Define Your Supplier's Withholding Applicability

Use the Supplier Withholding Applicability window to set your supplier's withholding applicability for each withholding tax type.

Use the Supplier Withholding Tax Codes window to enter tax codes that apply and indicate the primary tax code per withholding tax type. When you enter a document, Oracle Payables for Colombia assigns the supplier's primary withholding tax codes to each document distribution line that applies.

Prerequisites

Before you can use the Supplier Withholding Applicability window, you must:

To define your supplier's withholding applicability:

  1. Navigate to the Supplier Withholding Applicability window.

  2. Select your supplier's name in the Supplier field.

  3. Select a withholding tax type and check the Subject Indicator check box for each withholding tax type the supplier is subject to from the customer.

  4. Press the Withholding Tax Codes button.

    The Supplier Withholding Tax Codes window appears.

  5. Enter one or more tax codes that apply to the supplier for each withholding tax type.

  6. Check the Primary check box if the tax code is the primary tax code within a withholding tax type for the withholding tax. Within each withholding tax type, only one tax code can be the primary tax for each supplier.

  7. Save your work.

Entering Documents

You can either manually enter documents by matching an invoice to a purchase order, or use Invoice Gateway.

The globalization flexfield in the Distributions window lets you enter or change a ship-to location or taxpayer ID for each document distribution line before a document is approved. If an invoice is matched to a purchase order, the default ship-to location is derived from the purchase order details. You can use the globalization flexfield to change the ship-to location or associate a different taxpayer ID to distribution lines.

Oracle Payables for Colombia defaults withholding tax codes for each distribution line that applies based on your withholding tax setup information and the ship-to location and taxpayer ID associated with each distribution line. Document distribution line amounts are summed up by tax code and taxpayer ID to create a taxable base amount for calculating withholding tax.

Before approving a document, you can:

To enter or change a ship-to location or taxpayer ID:

  1. Navigate to the Invoices window.

  2. Query or enter the invoice that you want.

  3. Navigate to the globalization flexfield.

  4. Enter the ship-to location in the Ship To Location field if you want the ship-to location to be defaulted to all the invoice distributions.

    Note: When you use a distribution set to create invoice distributions and do not enter a ship-to location, a warning message will ask you to enter a ship-to location so that withholdings are defaulted for each distribution. If you ignore the message, you must manually update the ship-to locations for each distribution that you create.

  5. Press the OK button.

  6. Press the Distributions button.

    The Distributions window appears.

  7. Select a distribution line, and view and update the standard distribution line information.

  8. Navigate to the globalization flexfield.

  9. Enter or change the supplier's ship-to location in the Ship To Location field.

  10. Enter or change the supplier's taxpayer ID in the Taxpayer ID field. Leave this field blank to automatically associate the distribution line with the taxpayer ID from the header level.

  11. Press the OK button.

  12. Save your work.

Colombian Payables Withholding Certificate Report

Use the Colombian Payables Withholding Certificate report to print supplier withholding certificates. For each withholding tax type, you provide withholding certificates for each supplier that you withheld taxes for. The certificates are normally printed annually to cover all withholdings for a tax year; however, you can print this report for any supplier for any period.

Note: Payables only creates withholding certificate information for suppliers that have a bill-to and ship-to address defined at the supplier header level.

The withholding certificate has the same general format for each of the withholding tax types, including the taxable period, company information, supplier information, city where the tax was withheld, and the city where the withholding tax was paid. Withholding information includes the taxable base amount and withheld amount for each concept.

The VAT withholding certificate includes additional information for each concept, such as the VAT amount and the reported tax rate for the tax code.

Use the Standard Request Submission windows to submit the Colombian Payables Withholding Certificate report.

Report Parameters

Start Date

Enter the starting date of the taxable period that you want a certificate for.

End Date

Enter the ending date of the taxable period that you want a certificate for.

Withholding Tax Type

Enter the tax withholding type or leave this field blank for all tax withholding types.

Supplier Name

Enter the supplier's name if you want to generate certificates for one supplier. This option overrides any supplier range entries.

Supplier Name Range From

Enter the starting supplier's name if you want certificates for a range of suppliers.

Supplier Name Range To

Enter the ending supplier's name if you want certificates for a range of suppliers.

Supplier Number Range From

Enter the starting supplier's number if you want certificates for a range of suppliers.

Supplier Number Range To

Enter the ending supplier's number if you want certificates for a range of suppliers.

Report Headings

In this heading… Oracle Payables prints…
<Certificate Name> The name of the certificate that you defined as certificate header text for the tax withholding type
Taxable Period From The starting withholding date of the taxable period that you entered
To The ending withholding date of the taxable period that you entered
City where the withholding was done The city associated with the supplier's bill-to location
City where the withholding was paid The payment city associated with the tax withholding type
Name Your company name
Address Your company address
NIT Number Your company taxpayer ID
Name Your supplier name
Address Your supplier legal site address
NIT Number Your supplier taxpayer ID
Date The current date
Signature A space for a signature

Column Headings

In this column… Oracle Payables prints…
Concept The concept name (tax authority category for the tax code)
Total Amount The total taxable base amount for all withholdings within the concept for a supplier within the taxable period range. For remittance tax, this is the total calculated base amount.
VAT Amount (VAT Withholding Certificate) The total VAT amount associated with the concept taxable base amount
Concept Rate (VAT Withholding Certificate) The concept percentage rate for VAT, the reported tax rate for the tax code
Withholding Amount The total withheld amount within the concept for a supplier within the specified taxable period range

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Colombian Payables Withholding Report

The Colombian Payables Withholding report is an internal report that details tax withholding information for a taxable period which you can use for audit purposes. You can report on any tax withholding type. The report shows the document number, withholding accounting date, taxable base amount, and withholding amount by tax withholding type, accounting flexfield, and supplier. The VAT Withholding Tax details also include the VAT amount. Totals for the supplier, accounting flexfield, and tax withholding type are calculated.

Note: Payables only prints supplier information for suppliers that have a bill-to and ship-to address defined at the supplier site level.

Use the Standard Request Submission windows to submit the Colombian Payables Withholding report.

Report Parameters

Period From

Enter the starting withholding period for the range that you want to report from. Leave this field blank for the current withholding period.

Period To

Enter the ending withholding period for the range that you want to report to.

Taxpayer ID From

Enter the starting supplier's taxpayer ID for the range that you want to report from. Leave this field blank for the first taxpayer ID.

Taxpayer ID To

Enter the ending supplier's taxpayer ID for the range that you want to report to. Leave this field blank for the last taxpayer ID.

Withholding Type From

Enter the starting withholding type for the range that you want to report from. Leave this field blank for the first withholding type.

Withholding Type To

Enter the ending withholding type for the range that you want to report to. Leave this field blank for the last withholding type.

Flexfield From

Enter the starting accounting flexfield for the range that you want to report from. Leave this field blank for the first accounting flexfield.

Flexfield To

Enter the ending accounting flexfield for the range that you want to report to. Leave this field blank for the last accounting flexfield.

Report Headings

In this heading… Oracle Payables prints…
Withholding Tax Type The withholding type that you entered
Period From The starting withholding period that you entered
To The ending withholding period that you entered
Start Flexfield The starting accounting flexfield that you entered
End Flexfield The ending accounting flexfield that you entered
Flexfield The accounting flexfield for the withholding distribution line details
Taxpayer ID Number The supplier taxpayer ID
Supplier Name The supplier name

Column Headings

In this column... Oracle Payables prints...
Document Number The document number
Accounting Date The withholding accounting date for the withholding distribution
Taxable Base Amount The taxable base amount for the withholding distribution
VAT Amount (VAT withholdings) The VAT amount associated with the taxable base amount
Withholding Amount The amount withheld for the withholding distribution

Row Headings

In this row… Oracle Payables prints…
Supplier Total The totals for the supplier within an accounting flexfield and withholding type
Flexfield Total The totals for the accounting flexfield within a withholding type
Withholding Tax Type Total The sum of the totals for the withholding type

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Oracle Inventory

Inflation Adjustment for Inventory

Colombia law requires that you report the inflationary effects on your inventory in your financial statements. To meet this requirement, you must periodically adjust your inventory for inflation.

This requirement is similar to the inflation adjustment requirement for fixed assets. See Inflation Adjustment Overview for more information.

The Departamento Administrativo Nacional de Estadistica (DANE), the National Statistics Department of Colombia, issues an inflation adjustment index, the Porcentaje De Ajuste Del Ano Gravable (PAAG), during the first five days of the month. This index, given as a percentage, corresponds to the previous month's variation of the General Consumer Price Index which you must apply to the value of all purchased inventory.

Oracle Inventory Inflation Adjustment helps you meet inflation adjustment requirements.

To meet the legal requirements for inventory inflation adjustment, you must store, track, and report:

Inflation Adjustment for Inventory requires these conditions:

The solution does not support transactions related to manufacturing processes.

Related Topics

Defining Costing Information, Oracle Inventory User Guide

Overview of Inventory Transactions, Oracle Inventory User Guide

Inventory Inflation Adjustment Setup Steps

You must complete these one-time setup steps:

  1. Define a price index

  2. Assign the Inflation Index

  3. Define item category set and categories

  4. Assign the item category set and categories

  5. Assign the name of the category set and categories

  6. Define Inflation Adjustment GL accounts

  7. ,Assign Inventory Inflation Adjustment accounts to items

  8. Load your historical data

Define a Price Index

Define a price index to store the government-supplied inflation adjustment index.

To define a price index:

  1. Navigate to the Price Indexes window.

  2. Enter the name of the Price Index in the index field. For example, PAAG for Porcentaje De Ajuste Del Ano Gravable.

  3. Save your work.

Related Topics

Defining Price Indexes, Oracle Assets User Guide

Assign the Inflation Index

Assign the price index defined in the previous step to the Colombia Manufacturing responsibility.

To assign the price index:

  1. Navigate to the Find System Profile Values window.

  2. Check the Responsibility check box.

  3. Enter Colombia Manufacturing in the Responsibility field.

  4. Enter CST: Price Index for Inflation Adjustment in the Profile field.

  5. Choose find.

    The System Profile Values window appears.

  6. In the corresponding responsibility field, enter PAAG if you defined PAAG as the Price Index for Porcentaje De Ajuste Del Ano Gravable. Please note that the price index defined here will be defaulted at the time of running the inflation adjustment processor and can be overridden at the time of running the processor.

Define Item Category Set and Categories

You can define new item category sets and categories to identify inflation adjustment items in Oracle Inventory. Category sets provide the flexibility to designate specific inventory or non-monetary items that require inflation adjustments.

For example, you might create a category set for the non-monetary asset Office Furniture, which could include categories such as desks, chairs, and filing cabinets.

You can skip this step if you have already set up the category sets and categories that you need to identify inflation adjustment items.

Related Topics

Defining Categories, Oracle Inventory User Guide

Defining Category Sets, Oracle Inventory User Guide

Assign the Item Category Set and Categories

The item category set and categories defined in the previous step are assigned at the site level.

You can skip this step if you want to apply the inflation adjustment to all inventory items.

This table indicates the effects of all combinations of category and category set assignments.

Category Set Category Inflation Adjustment Applied To
Not assigned Not assigned All
Assigned Not assigned Items with matched category set
Not assigned Assigned Items with matched category
Assigned Assigned Items with both matched

To assign item category set and category:

  1. Navigate to the Find System Profile Values window.

  2. Check the Site checkbox.

  3. Query for CST: Item Category Set for Inflation Adjustment in the Profile field.

    The System Profile Values window appears.

  4. In the Site field, select the name of the item category set that you defined from the list of values.

  5. Query for CST: Item Category for Inflation Adjustment in the Profile field.

  6. In the Site field, select the name of the category that you defined from the list of values.

  7. Save your work.

Assign the Name of the Category Set and Categories

Use the Inventory setup window to assign the names of the category set and categories used to store the inflation adjustment index to the Colombia Manufacturing Responsibility.

Define Inflation Adjustment GL Accounts

For each organization, you must define the accounts that are used to track inflation adjustments.

To define the GL accounts that track the inflation adjustment:

  1. Navigate to the GL Accounts window.

  2. Enter an account for each of these inventory inflation adjustment accounts. Although these descriptions are optional, using these descriptions simplifies assigning accounts to your items.

    • Inflation Adjustment Account - An asset account used to accrue inflation adjustments for inventory items.

    • Monetary Correction Account - A revenue account that is the offsetting account for the Inventory Inflation Adjustment Account and is treated as income in financial statements.

    • Sales Cost Account - An expense account that is debited when the Inflation Adjustment Portion that corresponds to Material Issues is retired.

  3. Select an effective From Date, but leave the To Date field blank.

  4. Check the Enabled check box to activate the account. If you entered an Effective Date range, the account is only enabled within that date range.

  5. Check the Allow Posting check box if you need to allow posting.

  6. Check the Allow Budgeting check box if you need to allow budgeting.

    You also set Allow Posting and Allow Budgeting attributes for the individual segment values; however, the Allow Posting and Allow Budgeting attributes for the accounts do not override the attributes for the individual segment values. For example, if you allow posting to an account with a segment value that does not allow posting, you cannot post to that account.

    Note: You cannot set Allow Posting for the Net Income account that is specified for a ledger with average balance processing enabled.

  7. Save your work.

Related Topics

Defining Accounts, Oracle General Ledger User Guide

Assign Inventory Inflation Adjustment Accounts to Items

Use the globalization flexfield in the Organization Items window to assign the inventory inflation accounts defined in the previous step to each inventory item.

To assign the inventory inflation accounts:

  1. Navigate to the Organization Items window.

  2. Select an item from the list of values.

  3. Navigate to the globalization flexfield.

  4. In the Inflation Adjustment Account field, enter the corresponding account number.

  5. In the Monetary Correction Account field, enter the corresponding account number.

  6. In the Sales Cost Account field, enter the corresponding account number.

  7. Save your work.

    Note: The Inventory Item Application, Fiscal Classification Code, and Transaction Condition Class fields are not used for inventory inflation adjustment. These fields are used for the Latin Tax Engine in Oracle Receivables for Colombia. For more information, see Assign Tax Condition Classes and Fiscal Classifications to Items.

Related Topics

Defining Items, Oracle Inventory User Guide

Load the Historical Data

You must load historical data to establish a baseline for inventory inflation adjustment calculations by creating and running a SQL script to execute the create_historical_cost API.

If a problem occurs while creating historical data, you can delete and reload the data. Deleting historical data is done using a SQL script to execute the delete_all_historical_costs API.

To load historical data:

  1. Create a SQL script to load the create_historical_cost API.

  2. Load the create_historical_cost API from the public package CST_MGD_INFL_ADJUSTMENT_PUB.

  3. Execute the create_historical_cost API using the SQL script and these parameters, as described in this table.

    Create_historical_cost

    Parameter Usage Type Description
    p_api_version_ number Input NUMBER Colombian Mfg Version must be 1.0.
    p_init_msg_list Input VARCHAR2 Initializes the message stack.
    x_return_status Output VARCHAR2 Returns the program execution status.
    x_msg_count Output NUMBER Returns the number of messages in message stack.
    p_historical_cost_ rec Input Inflation_ Adjustment_ Rec_ Type A record that holds historical cost data per item and is defined in the CST_MGD_INFL_ ADJUSTMENT_PUB package.
    p_api_version_ number Input NUMBER Colombian Mfg Version must be 1.0.

To delete historical data:

  1. Create a SQL script to load the delete_all_historical_costs API .

  2. Load the delete_all_historical_costs API from the public package CST_MGD_INFL_ADJUSTMENT_PUB.

  3. Execute the delete_all_historical_costs API using the SQL script and these parameters, as described in this table.

    Delete_all_historical_costs

    Parameter Usage Type Description
    p_api_version_ number Input NUMBER Colombian Mfg Version. must be 1.0
    p_init_msg_list Input VARCHAR2 Initializes the message stack.
    x_return_status Output VARCHAR2 Returns the program execution status.
    x_msg_count Output NUMBER Returns the number of messages in message stack.

Inventory Inflation Adjustment Processing

You must periodically perform these steps:

  1. Enter the inflation adjustment index value for the current period

  2. Close the accounting period

  3. Run the inflation adjustment processor

  4. Print the Kardex Report

  5. Review calculations in the Kardex Reports

  6. Transfer the adjustment transactions to General Ledger

Enter the Inflation Adjustment Index Value for the Current Period

You must enter a value for the Price Index defined to store the inflation adjustment index value issued by DANE.

To enter the Inflation Adjustment Index Value:

  1. Navigate to the Price Indexes window.

  2. Select the name of the Price Index (such as PAAG) from the list of values.

  3. Enter the inflation adjustment index value for the current period as a percentage (for example, enter 20 for 20%) in the Value % field.

  4. Enter the From Date and To Date that this index is effective for. The date range that you specify must be the same as the Inventory Accounting Period.

  5. Save your work.

Related Topics

Maintaining Accounting Periods, Oracle Inventory User Guide

Defining Price Indexes, Oracle Assets User Guide

Close the Accounting Period

In Oracle Cost Management, close the accounting period.

Related Topics

Overview of Period Close, Oracle Cost Management User Guide

Run the Inflation Adjustment Processor

The Inflation Adjustment Processor calculates the ending inflation value by applying the inflation adjustment index to each inventory item. You must run this process for each organization that requires an inflation adjustment. See Calculating the Inventory Inflation Adjustment for more information about inflation adjustment calculations.

To run the Inflation Adjustment Processor:

  1. Navigate to the Submit Requests window.

  2. Select Inflation Adjustment Processor from the list of values to display the Parameters window.

  3. In the Organization field, select an organization from the list of values. You should only select organizations that must have their inventories revalued.

  4. Select an accounting period from the list of values. You should only select closed accounting periods.

  5. Choose OK.

Print the Kardex Reports

See Fiscal Kardex Reports for more information about Fiscal Kardex reports. You can run these reports in any order.

Review Calculations in the Kardex Reports

Before you post the adjustment to General Ledger, review the Fiscal Kardex reports (Adjusted and Historical) to verify that the adjustment calculations are correct. See Fiscal Kardex Reportsfor more information.

Transfer the Adjustment Transactions to General Ledger

Once the adjustments are calculated and are verified by the Fiscal Kardex Reports, you must transfer adjustments to General Ledger in the period that follows the adjusted period, before you run the Inflation Adjustment Processor for the period following the adjusted Period. For example, if you run the inflation adjustment processor for November on December 5, then you must transfer the adjustments before the end of the month (December 31).

To transfer adjustments to the General Ledger:

  1. Navigate to the Submit Requests window.

  2. Select Inflation Adjustment Transfer to GL to display the Parameters window.

  3. Select an organization from the list of values.

  4. You should only select organizations that have had their inventory adjusted for inflation.

  5. Select an accounting period from the list of values. You should only select closed accounting periods.

  6. Choose OK.

Calculating the Inventory Inflation Adjustment

This section provides an example to illustrate the calculations that the Inventory Inflation Adjustment processor makes and the accounting entries that result.

As you follow the example, please note:

Inflation Adjustment Calculation Example

This example shows transactions, calculations, and journal entries for inflation adjustment performed on one organization between January 2000 and February 2000.

As required, the example uses an average costing organization.

This example assumes that:

Transactions Calculated for Period January 2000

This table summarizes the transactions for this period, with beginning total quantity and balance value of 0.

Date ReceiptQuantity Issue Quantity Receipt Unit Cost Issue Unit Cost Receipt Transaction Cost Issue Transaction Cost Total Quantity Balance Value
1/31 170 130     1700 1300 40 400.00

The final totals for this period are the same values as shown in the above table.

Inflation Adjustment Calculation for January 2000

This table shows the calculation at the beginning of the period.

Quantity Balance Value Prior Final Inflation Beginning Inflation
0 0.00 0 0

This table shows the calculation for receipt activity.

Quantity Value Unit Adjustment
170 1700.00 0.00

This table shows the calculation for issue activity.

Quantity Value Unit Adjustment Inflation Issue
130 1300.00 0.00 0.00

This table shows the calculation at the end of the period.

Quantity Balance Value Final Inflation
40 400.00 0.00

Accounting Entries for January 2000

This table shows the accounting entries for this period.

Date Journal Entry Debit Credit
01/30 Inflation Adjustment 0.00  
       Monetary Correction   0.00
  For Inflation Revaluation    
01/30 Sales Cost 0.00  
       Inflation Adjustment   0.00
  For Material Issues    

Transactions Calculated for Period February 2000

This table summarizes the transactions for this period, with beginning total quantity of 40 and balance value of 400.00, carried over from January 2000.

Date Receipt Quantity Issue Quantity Receipt Unit Cost Issue Unit Cost Receipt Transaction Cost Issue Transaction Cost Total Quantity Balance Value
02/03 20   10   200   60 600.00
02/05 200   10   2000   260 2600.00
02/06   40   10   400 220 2200.00
02/15 10   10   100   230 2300.00
02/20   20   10   200 210 2100.00
02/25   10   10   100 200 2000.00

This table shows the final totals for this period, including the beginning quantity of 40 and balance value of 400.00.

Receipt Quantity Issue Quantity Receipt Transaction Cost Issue Transaction Cost Total Quantity Balance Value
230 70 2300 700 200 2000.00

Inflation Adjustment Calculation for February 2000

This table shows the calculation at the beginning of the period.

Quantity Balance Value Prior Final Inflation Beginning Inflation
40 400.00 0 12

This table shows the calculation for receipt activity.

Quantity Value Unit Adjustment
230 2300.00 .04

This table shows the calculation for issue activity.

Quantity Value Unit Adjustment Inflation Issue
70 700.00 .04 3.11

This table shows the calculation at the end of the period.

Final Quantity Final Balance Value Final Inflation
200 2000.00 8.89

Accounting Entries for February 2000

This table shows the accounting entries for this period.

Date Journal Entry Debit Credit
2/28 Inventory Inflation Adjustment 12.00  
       Monetary Correction   12.00
  For Inflation Revaluation    
2/28 Sales Cost 3.11  
       Inventory Inflation Adjustment   3.11
  For Material Issues    

Transaction Costing Calculations

Inflation Costing Calculations

Related Topics

Overview of Average Costing, Oracle Cost Management User Guide

Fiscal Kardex Reports

The Fiscal Kardex reports supplied with Inflation Adjustment for Inventory are designed to meet the statutory requirements of the Colombian government. Ensure that you run the inflation adjustment processor for the period before you print these reports for the same period.

The reports list, by period and item, the initial and final costs, as well as all the transactions in the period. Items that have had no activity during the period are displayed without the transaction detail. There are two versions of the reports:

The reports are very similar. The Adjusted report has information specific to the beginning, final, and total inflation. The Adjusted report also adds figures in the top section for Beginning and Final Total inflation.

Inflation Adjustment for Inventory assumes that you use the average costing method and that inflation adjustment is periodically run. Inflation adjustment is calculated at the period level, where different types of transactions are grouped together in the calculation, rather than at each individual transaction level as for average costing calculation. Inflation adjustment for each individual transaction in the report is estimated and should not be interpreted as the exact inflation adjustment for the transaction, but rather as the average inflation adjustment.

Report Parameters

Organization Code

Select an Organization Code. You should only select organizations that have had their inventory adjusted for inflation.

From Date

Enter the date that you want to run the report from.

To Date

Enter the date that you want to run the report to.

From Item Code

Select the beginning item that you want the report to run from.

To Item Code

Select the ending item that you want the report to run to.

Column Headings

Historical

In this column... Oracle Inventory prints...
Date The transaction date
Type The type of transaction generating the posting to General Ledger
Beginning Inventory - Quantity The inventory quantity at the beginning of the period
Beginning Inventory - Unit Cost The inventory unit cost at the beginning of the period
Beginning Inventory - Total Cost The total cost of inventory at the beginning of the period
Transaction - Quantity The number of units transacted
Transaction - Unit Cost The unit cost at the time of transaction
Transaction - Total Cost The total unit cost (Transaction Cost x Transaction Quantity)
Final Inventory - Quantity The inventory quantity at the end of the period
Final Inventory - Unit Cost The inventory cost at the end of the period
Final Inventory - Total Cost The total cost of inventory at the end of the period

Adjusted

In this column... Oracle Inventory prints...
Date The transaction date
Type The type of transaction generating the posting to General Ledger
Beginning Inventory - Quantity The inventory quantity at the beginning of the period
Beginning Inventory - Unit Cost The inventory unit cost at the beginning of the period
Beginning Inventory - Total Cost The total cost of inventory at the beginning of the period
Beginning Inventory - Total Inflation The total beginning inflation per unit
Transaction - Quantity The number of units transacted
Transaction - Unit Cost The unit cost at the time of transaction
Transaction - Total Cost The total unit cost (Transaction Cost x Transaction Quantity)
Transaction - Total Inflation The total inflation per unit cost
Final Inventory - Quantity The inventory quantity at the end of the period
Final Inventory - Unit Cost The unit cost of inventory at the end of the period
Final Inventory - Total Cost The total cost of inventory at the end of the period
Final Inventory - Total Inflation The total inflation cost at the end of the period

Oracle Receivables

Income Tax Self Withholding and VAT

Companies can obtain the right from the Departamento de Impuestos y Aduanas Nacionales (DIAN) to self-withhold income tax on a customer invoice as a prepayment for their own income tax. Companies accrue and account for the income tax per invoice and pay the self-withheld income tax to the government.

A company may, for example, prefer to remit self withholding tax instead of having its customers withhold income tax on the company's behalf because this process involves collecting and reconciling a large amount of withholding income tax certificates before the income tax return due date.

Withholding Responsibility

The responsibility for withholding income tax on a sales invoice depends upon the withholding tax status of both you and your customer.

This table describes who is responsible for withholding income tax on a sales invoice.

If you are... If the customer is income tax withholding agent... If the customer is not an income tax withholding agent...
Responsible for self withholding income tax You self-withhold income tax No income tax is withheld
Not responsible for self withholding income tax Customer withholds income tax No income tax is withheld

Value Added Tax (VAT)

Any VAT paid on a company invoice is referred to as input tax. Value Added Tax (VAT) is imposed on the value added to goods or services at each stage of their supply. The VAT charged on a customer invoice is referred to as output tax. The formula to describe the VAT amount due each period is Amount Due = Output Tax - Input Tax.

Latin Tax Engine

If you are subject to income tax and are a self-withholder of income tax, you must calculate and accrue for income tax self withholding on certain sales invoices. Oracle Receivables for Colombia provides the Latin Tax Engine to support your income tax self withholding requirements as well as your VAT requirements.

If you are required to self-withhold income tax, use the Latin Tax Engine to calculate income tax self withholding. The Latin Tax Engine also calculates and accounts for VAT. If you are not required to self-withhold income tax, use the standard Receivables tax engine to handle VAT on your invoices.

Related Topics

Setup Steps for Value Added Tax, Oracle Receivables User Guide

Calculating Income Tax Self Withholding and VAT

This section describes the values that Oracle Receivables uses to calculate income tax self withholding and VAT.

Income Tax Self Withholding

Oracle Receivables calculates income tax self withholding according to these criteria:

An income concept describes the nature of the sale. Professional Fees, Goods, and Services are examples of income concepts. Oracle Receivables calculates income tax on an invoice line according to the income concept for that invoice line. A single invoice can contain multiple income concepts.

The government establishes the minimum taxable base and the withholding rate for each income concept. In accordance with the Plan Unico de Cuentas (PUC), you must maintain designated accounts for the prepaid tax asset and the self withholding liability.

Oracle Receivables calculates income tax self withholding on a transaction when:

Example 1 illustrates the income tax self withholding calculation.

Example 1: Income Tax Self Withholding

This table provides an example of income tax rates and minimum taxable amounts for income concepts.

Income Concept Income Tax Rate Minimum Taxable Amount
Goods 3% 300
Services 4% 400
Professional Fees 10% 600

You issue this invoice:

Line Item Amount
line 1 Item A (Income Concept: Goods) 100
line 2 Item B (Income Concept: Goods) 1,000
line 3 Item C (Income Concept: Services) 2,000
line 4 Item D (Income Concept: Professional Fees) 500
  Total Invoice 3,100

Oracle Receivables calculates income tax self withholding as shown in this table:

Income Concept Invoice Lines Amount present on invoice Income Tax Self-Withheld
Goods 1 and 2 1,100 33 (3% * 1100)
Services 3 2,000 80 (4% * 2000)
Professional Fees 4 500 0

There is no income tax self withholding for the income concept Professional Fees, since the invoice line amount is less than the minimum taxable base.

VAT

Oracle Receivables calculates VAT according to these criteria:

A company is registered with one of two VAT regimes: simplified or common. A simplified regime is a company with a sales volume below a certain threshold. These companies are not required to collect VAT. A common regime is a company required to charge and collect VAT.

For VAT purposes, a customer is considered either national or foreign. Sales to foreign customers are considered exempt from VAT and are taxed at a 0% VAT rate. Sales to national customers are charged VAT according to the items sold.

The three fiscal classifications for items sold are:

Example 2 illustrates a VAT and income tax self withholding calculation.

Example 2: VAT and Income Tax Self Withholding

This table provides an example of VAT and income tax self withholding information for items A through D.

Item VAT Fiscal Classification VAT Rate Income Tax Self Withholding Income Concept Income Tax Self Withholding Minimum Amount Taxable Income Tax Self Withholding Income Tax Rate
Item A Taxable 16 Goods 300 3
Item B Taxable 16 Goods 300 3
Item C Exempt 0 Services 400 4
Item D Excluded Not Applicable Professional Fees 600 10

You issue the following invoice:

line 1 Item A 100

line 2 Item B 1,000

line 3 Item C 300

line 4 Item D 1,500

Total Invoices 2,900

Oracle Receivables calculates VAT and income tax self withholding as shown in this table:

Line VAT Income Tax Self-Withheld
1 16 = (100 * 16%) 0
2 160 = (1,000 * 16%) 33 = ((100 + 1,000) * 3%)
3 0 = (300 * 0%) 0
4 Not Applicable 150 = (1,500 * 10%)

The total VAT is 176 and the total self-withheld income tax is 188.

There is no income tax self withholding for the income concept Services, since the invoice line amount is less than the minimum taxable base.

Setting Up for Income Tax Self Withholding and VAT

This section describes the steps for setting up Oracle Receivables and the Latin Tax Engine to calculate income tax self withholding and VAT. Use the setup checklist to help you complete the appropriate steps in the correct order.

Your Oracle Receivables for Colombia installation already includes some of the codes and values described in this section. The setup tasks in this chapter indicate whether the data included in the accompanying tables is included in your installation by the following notices:

For setup tasks that refer to data that is already included in your installation, you can use the task as a guideline for modifying existing information or adding new information, if this is required.

Prerequisites

Before you can set up Oracle Receivables to calculate income tax self withholding and VAT, you must set the JL AR Tax: Use Related Transactions for Threshold Checking profile option to Yes at System level.

Setup Checklist

Use this checklist to help you complete the appropriate setup steps for income tax self withholding and VAT in the correct order.

Step Setup Task
1 Define System Options
2 Define Tax Conditions
3 Define Tax Condition Values
4 Define Tax Categories
5 Associate Tax Categories with Tax Conditions
6 Define Tax Codes and Rates
7 Define Tax Condition Classes for Organizations
8 Assign Tax Condition Classes to Organization Locations
9 Define Tax Condition Classes for Customers
10 Assign Tax Condition Classes to Customers
11 Define Tax Condition Classes for Transactions
12 Define Fiscal Classifications
13 Assign Tax Condition Classes and Fiscal Classifications to Items
14 Assign Tax Condition Classes and Fiscal Classifications to Memo Lines
15 Define Tax Group
16 Assign Tax Group to Transaction Types
17 Define Tax Rules

Define System Options

Use the Oracle Receivables System Options window and the globalization flexfield to set system options to calculate income tax self withholding and VAT.

Prerequisites

Before you can use the System Options window, you must:

Notes for setting Oracle Receivables system options:

  1. In the Location Flexfield Structure field, enter a location flexfield structure.

    Use one of the available location flexfield structures, or define your own location flexfield structure in the Key Flexfield Segments window. The name of the location flexfield structure that you define must contain either State or Province as one of the segments.

    Note: You must define the segment State or the segment Province in English only, if you are going to use the Latin Tax Engine. The Latin Tax Engine only recognizes these values in English.

  2. In the Location Flexfield Classification field, enter State or Province, depending on the location flexfield structure that you entered in the Location Flexfield Structure field.

  3. Uncheck the Compound Taxes check box.

  4. Enter Line in the Calculation Level field to let Oracle Receivables calculate taxes separately for each line.

Related Topics

Defining a Sales Tax Location Flexfield Structure, Oracle Receivables User Guide

Defining Receivables System Options, Oracle Receivables User Guide

Define Tax Conditions

Use the Lookups window to create lookup codes for income tax self withholding and VAT tax conditions. Tax conditions determine whether Oracle Receivables calculates income tax self withholding and VAT on a specific transaction.

The tax conditions that you define describe the possible conditions of your company, your customers, and your transactions.

Define tax conditions for the following lookup types:

After you define tax conditions, define the tax condition values for each tax condition. See Define Tax Condition Values for more information.

Create the tax conditions shown in this table for income tax self withholding:

This data is already included in your installation

Lookup Type Lookup Code Description
ORGANIZATION_ATTRIBUTE INCOME TAX SW STATUS Company income tax self withholding status
CONTRIBUTOR_ATTRIBUTE INCOME TAX WH RESPONS Customer income tax withholding responsibility
TRANSACTION_ATTRIBUTE INCOME CONCEPT Transaction income tax self withholding concept

Create the tax conditions shown in this table for VAT:

This data is already included in your installation

Lookup Type Lookup Code Description
ORGANIZATION_ATTRIBUTE VAT REGIME Company VAT Regime
CONTRIBUTOR_ATTRIBUTE VAT STATUS Customer VAT status
TRANSACTION_ATTRIBUTE VAT QUALITY Transaction VAT Quality

Define Tax Condition Values

Use the Lookups window to create lookup codes for tax condition values.

Tax condition values specify each of the possible values of a tax condition. For example, the possible values of the tax condition income tax self-withholder (ITSW Status) for an organization are Self-Withholder and Non-Self-Withholder.

Define tax conditions for the lookup type JLZZ_AR_TX_ATTR_VALUE.

After you define tax condition values for each tax condition, you can associate both the tax condition and tax condition values with Latin tax categories. See Associate Tax Categories with Tax Conditions for more information.

Create the tax condition values for organizations, contributors, and transactions as shown in this table for lookup type JLZZ_AR_TX_ATTR_VALUE and income tax self withholding:

This data is already included in your installation

Organization/Contributor/Transaction Lookup Code Description
Organization SELF WITHHOLDER Income tax self-withholder
Organization NON SELF WITHHOLDER Income tax non-self-withholder
Contributor WITHHOLDING AGENT Income tax withholding agent
Contributor NON WITHHOLDING AGENT Not an income tax withholding agent
Transaction GOODS Income from sale of goods
Transaction SERVICES Income from sale of services
Transaction COMMISSIONS Income from commissions
Transaction PROFESSIONAL FEES Income from professional fees
Transaction LEASINGS Income from leases

Create the following tax condition values for organizations, contributors, and transactions shown in this table for lookup type JLZZ_AR_TX_ATTR _VALUE and VAT:

This data is already included in your installation

Organization/Contributor/Transaction Lookup Code Description
Organization COMMON REGIME Common regime
Organization SIMPLIFIED REGIME Simplified regime
Contributor NATIONAL CUSTOMER National customer
Contributor FOREIGN CUSTOMER Foreign customer
Transaction TAXABLE VAT taxable item (taxed or exempt)
Transaction EXCLUDED VAT excluded item

Define Tax Categories

Use the Lookups window to create lookup codes for tax categories for income tax self withholding and VAT.

Use the Latin Tax Categories window, after you create the lookup codes, to define the income tax self withholding and VAT tax categories.

Note: If you want the Latin Tax Engine to derive the tax code from a tax category, associate the tax code with a tax category after you define it in the Tax Codes and Rates window. See Define Tax Codes and Rates for more information.

You create tax category lookup codes for income tax self withholding for the following two tax accruals, in order to create a double-sided accounting entry (asset and liability):

You create one tax category lookup code for VAT (VAT).

Create the tax categories shown in this table for lookup type JLZZ_AR_TX_CATEGRY:

This data is already included in your installation

Lookup Code Description
ITSW-A Income tax self-withholder prepaid
ITSW-L Income tax self-withholder payable
VAT VAT

Use the Latin Tax Categories window to define income tax self withholding and VAT tax categories, using the tax category lookup codes that you created in the Lookups window.

Define the two tax categories shown for income tax self withholding. Use this setup for both ITSW-A and ITSW-L tax categories.

This data is already included in your installation

Field Value
Category ITSW-A/ITSW-L
Effective From 01/01/90
Effective To Default
Threshold Check Level Operation
Grouping Condition Type Income Concept
Min Amount None
Min Taxable Basis None
Inclusive Tax No
Print No
Tax Category Description Income tax self withholding prepaid/ Income tax self withholding payable

Notes for defining tax categories for income tax self withholding:

  1. If necessary, enter effective dates for the tax categories. The tax category is effective within the stated date range.

  2. Enter Operation in the Threshold Check Level field. An operation is an invoice and its related debit memos and/or credit memos.

    Note: Oracle Receivables updates the Grouping Condition Type field with the value Income Concept when you associate the tax categories with tax conditions. See Associate Tax Categories with Tax Conditions for more information.

    These two values let Oracle Receivables:

    • Group transaction line amounts by income concept within related transactions (invoice, credit memos, debit memos)

    • Check income concept transaction totals against threshold amounts

  3. Uncheck the Inclusive Tax check box. Income tax self withholding is not included in the price of an item.

  4. Uncheck the Print check box. Income tax self withholding lines are not printed on invoices.

  5. Enter the default rate, minimum taxable base, and minimum tax amount in the Latin Tax Groups window, since these values depend on the income concept.

    You enter these values in the Latin Tax Groups window when you assign each self withholding tax category to a combination of organization, contributor, and transaction conditions. See Define Tax Group for more information.

Define one tax category for VAT:

This data is already included in your installation

Field Value
Category VAT
Effective From 01/01/90
Effective To Default
Threshold Check Level Line
Grouping Condition Type None
Min Amount None
Min Taxable Basis None
Inclusive Tax No
Print Yes
Tax Category Description Value Added Tax

Notes for defining a tax category for VAT:

  1. Enter Line in the Threshold Check Level field. VAT is calculated at line level.

  2. Leave the Grouping Condition Type field blank. There is no threshold check for VAT.

  3. Uncheck the Inclusive Tax check box. VAT is not included in the price of an item.

  4. Check the Print check box. VAT lines must print on invoices.

  5. The default rate, minimum taxable base, and minimum tax amount do not apply to VAT.

Associate Tax Categories with Tax Conditions

Use the Associate Latin Tax Category with Conditions and Values window to associate income tax self withholding and VAT tax categories with tax conditions, and designate one tax condition as the determining factor tax condition. Oracle Receivables uses determining factor tax conditions to determine the income tax self withholding and VAT treatment to apply to transactions.

You define a determining factor tax condition for each combination of income tax self withholding tax category and condition type and VAT tax category and condition type for organization, contributor, and transaction.

Define the determining factor tax conditions as shown in this table for income tax self withholding:

This data is already included in your installation

Tax Category Condition Type Condition Name Mandatory in Class Determining Factor Grouping Attribute Condition Value
ITSW-A Organization Condition ITSW status Yes Yes No IT self-withholder or IT non self-withholder
ITSW-A Contributor Condition ITW Responsibility Yes Yes No IT withholding agent, or IT non withholding agent, or Default
ITSW-A Transaction Condition Income Concept Yes Yes Yes Goods, or Services, or Professional fees
ITSW-L Organization Condition ITSW status Yes Yes No IT self-withholder, or IT non self-withholder
ITSW-L Contributor Condition ITW Responsibility Yes Yes No IT withholding agent, or IT non withholding agent, or Default
ITSW-L Transaction Condition Income Concept Yes Yes Yes Goods, or Services, or Professional fees

Notes for associating tax categories with tax conditions for income tax self withholding:

  1. Check the Determining Factor check box for all tax categories and condition types.

    There is one determining factor tax condition for each tax category per condition type.

  2. Check the Mandatory in Class check box for all tax categories and condition types.

    All determining factor tax conditions are mandatory in class.

  3. Check the Grouping Attribute check box for transaction conditions only. When you save your work, Oracle Receivables updates the tax categories ITSW-A and ITSW-L with the grouping condition type Income Concept.

    Checking this check box for transaction conditions lets Oracle Receivables group transaction line amounts by income concept to determine the amount to compare to the minimum taxable base.

Define the determining factor tax conditions as shown in this table for VAT:

This data is already included in your installation

Tax Category Condition Type Condition Name Mandatory in Class Determining Factor Grouping Attribute Condition Value
VAT Organization Condition VAT Regime Yes Yes No Common or Simplified
VAT Contributor Condition VAT Status Yes Yes No National or Foreign
VAT Transaction Condition VAT Quality Yes Yes No Excluded or Taxable

Notes for associating tax categories with tax conditions for VAT:

  1. Check the Determining Factor check box for all tax categories and condition types.

    There is one determining factor tax condition for each tax category per condition type.

  2. Check the Mandatory in Class check box for all tax categories and condition types.

    All determining factor tax conditions are mandatory in class.

  3. Uncheck the Grouping Attribute check box for all condition types. There is no threshold check for VAT.

Define Tax Codes and Rates

Use the Tax Codes and Rates window to define tax codes for income concepts for income tax self withholding tax categories, and for fiscal classifications for VAT tax categories.

If you want the Latin Tax Engine to derive a tax code from a tax category:

If you want the Latin tax engine to derive a VAT tax code from a fiscal classification:

Income tax self withholding

Define two tax codes for each income concept, one for each of the two income tax self withholding tax categories:

You assign income tax self withholding tax codes to the corresponding income concepts in the Latin Tax Groups window when you associate each self withholding tax category with a combination of organization, contributor, and transaction conditions. See Define Tax Group for more information.

This table provides a guideline for defining tax codes for income tax self withholding. Actual rates and accounts depend on the prevailing legislation and on your company's chart of accounts.

EXAMPLE ONLY This data is not included in your installation

Tax Code From Tax Type Tax Rate Sign Tax Category Tax Allow Exempt Adhoc Inclusive Tax Allow Inclusive Override
Goods-Dr 01/01/90 VAT 3% Debit ITSW-A 01-135505-1004-0000-000-0000 No No No No
Goods 01/01/90 VAT 3% Credit ITSW-L 01-236575-1004-0000-000-0000 No No No No
Services-Dr 01/01/90 VAT 4% Debit ITSW-A 01-135505-1003-0000-000-0000 No No No No
Services 01/01/90 VAT 4% Credit ITSW-L 01-236575-1003-0000-000-0000 No No No No
Prof-fees-Dr 01/01/90 VAT 10% Debit ITSW-A 01-135505-1001-0000-000-0000 No No No No
Prof-fees 01/01/90 VAT 10% Credit ITSW-L 01-236575-1001-0000-000-0000 No No No No

Notes for defining income tax self withholding tax codes for income concepts:

  1. Enter VAT in the Tax Type field, instead of Sales Tax, since income tax self withholding rates do not depend on location.

  2. Uncheck the Allow Exemptions check box. This field is not used by the Latin Tax Engine.

  3. Uncheck the Adhoc check box. The tax rate cannot allow changes to the transaction entry.

  4. Uncheck the Inclusive Tax and Allow Inclusive Override check boxes. Income tax self withholding is not included in the price of an item.

VAT

Define one tax code for each tax rate. Define tax codes with the credit sign, because the tax codes correspond to VAT liabilities.

VAT tax rates vary according to the fiscal classification of an item. You assign VAT tax codes to corresponding fiscal classifications in the Latin Fiscal Classifications window. See Define Fiscal Classifications for more information.

This table is a guideline for defining tax codes for VAT. Actual rates and accounts depend on the prevailing legislation and on your company's chart of accounts.

EXAMPLE ONLY This data is not included in your installation

Tax Code From Tax Type Tax Rate Sign Tax Category Tax Allow Exempt Adhoc Inclusive Tax Allow Inclusive Override
VAT–0 01/01/90 VAT 0% Credit VAT 01-240805-1010-0000-000-0000 No No No No
VAT–1 01/01/90 VAT 16% Credit VAT 01-240805-1011-0000-000-0000 No No No No
VAT–2 01/01/90 VAT 20% Credit VAT 01-240805-1012-0000-000-0000 No No No No
VAT–3 01/01/90 VAT 35% Credit VAT 01-240805-1013-0000-000-0000 No No No No

Notes for defining VAT tax codes:

  1. Enter VAT in the Tax Type field, instead of Sales Tax, since VAT rates do not depend on location.

  2. Uncheck the Allow Exemptions check box. This field is not used by the Latin Tax Engine.

  3. Uncheck the Adhoc check box. The tax rate cannot allow changes to the transaction entry.

  4. Uncheck the Inclusive Tax and Allow Inclusive Override check boxes. VAT is not included in the price of an item.

Related Topics

Tax Codes and Rates, Oracle Receivables User Guide

Define Tax Condition Classes for Organizations

Use the Latin Tax Condition Classes window to define a tax condition class for your organization to manage both income tax self withholding and VAT handling.

You can define one tax condition class to contain all the values that determine the condition of each tax category for an organization: income tax self withholding - asset (ITSW-A), income tax self withholding - liability (ITSW-L), and VAT. Identify the organization for the tax condition class as both an income tax self-withholder and registered as a common regime.

After you create the tax condition class for both income tax self withholding and VAT handling, assign it to your organization. See Assign Tax Condition Classes to Organization Locations for more information.

Create the tax condition classes for organizations as shown in this table.

This data is already included in your installation

Class Type Class Code Description Tax Category Condition Code Value Code
Organization IT Self-Withholder Common Regime Income Tax Self-Withholder and Common Regime Organization ITSW-A ITSW status IT self-withholder
Organization IT Self-Withholder Common Regime Income Tax Self-Withholder and Common Regime Organization ITSW-L ITSW status IT self-withholder
Organization IT Self-Withholder Common Regime Income Tax Self-Withholder and Common Regime Organization VAT VAT regime Common Regime

Notes for defining a tax condition class for organizations:

  1. You previously defined the ITSW status and VAT regime tax conditions as determining factor tax conditions for the ITWS-A, ITSW-L, and VAT tax categories for an organization.

    See Associate Tax Categories with Tax Conditions for more information.

  2. Assign a condition value for the determining factors within this tax condition class. The values that you enter are IT self-withholder and Common Regime, which is the expected behavior for an organization.

  3. Enter Organization in the Class Type field and Organization Condition in the Condition Type field, so that you can assign this condition to organizations.

Assign Tax Condition Classes to Organization Locations

Use the globalization flexfield in the Location window to assign the organization tax condition class to the current inventory organization location. The organization inherits the values for the determining tax conditions associated with each tax category contained in the tax condition class.

Assign the organization tax condition class to the organization location shown in this table:

Location Name Establishment Type
Inventory Organization Location IT Self-Withholder - Common Regime

Define the Item Validation Organization

After you assign the organization tax condition class to the current organization location, enter the master inventory organization in the Item Validation Organization field of the Order Management Parameters window.

Related Topics

Defining Order Management System Parameters, Oracle Order Management Implementation Guide

Define Tax Condition Classes for Customers

Use the Latin Tax Condition Classes window to define tax condition classes for contributors (customers) to manage both income tax self withholding and VAT handling.

This table shows the three tax condition classes that you need to define to assign to customers:

Tax Condition Income Tax Withholding Responsibility VAT Status
National customers that are income tax withholding agents IT withholding agent National
National customers that are income tax non-withholding agents IT non-withholding agent National
Foreign customers, which are always income tax non-withholding agents IT non-withholding agent Foreign

Each tax condition class contains all the values that determine the condition of each tax category for a customer: income tax self withholding – asset (ITSW-A), income tax self withholding – liability (ITSW-L), and VAT.

After you create tax condition classes for customers for both income tax self withholding and VAT handling, assign them to your customer addresses. See Assign Tax Condition Classes to Customers for more information.

Create the tax condition classes as shown in these tables for customers:

This data is already included in your installation

Case 1: National Customers that are Income Tax Withholding Agents

Class Type Class Code Description Tax Category Condition Type Condition Code Value Code
Contributor IT Withholding Agent - National National customer that is an income tax withholding agent ITSW-A Contributor Condition ITW Responsibility IT withholding agent
Contributor IT Withholding Agent - National National customer that is an income tax withholding agent ITSW-L Contributor Condition ITW Responsibility IT withholding agent
Contributor IT Withholding Agent - National National customer that is an income tax withholding agent VAT Contributor Condition VAT status National

Case 2: National Customers that are Income Tax Non-Withholding Agents

Class Type Class Code Description Tax Category Condition Type Condition Code Value Code
Contributor IT Non Withholding Agent - National National customer that is an income tax non withholding agent ITSW-A Contributor Condition ITW Responsibility IT non- withholding agent
Contributor IT Non Withholding Agent - National National customer that is an income tax non withholding agent ITSW-L Contributor Condition ITW Responsibility IT non- withholding agent
Contributor IT Non Withholding Agent - National National customer that is an income tax non withholding agent VAT Contributor Condition VAT status National

Case 3: Foreign Customers (Income Tax Non-Withholding Agents)

Class Type Class Code Description Tax Category Condition Type Condition Code Value Code
Contributor IT Non- Withholding Agent - Foreign Foreign customers, which are income tax non withholding agents ITSW-A Contributor Condition ITW Responsibility IT non- withholding agent
Contributor IT Non- Withholding Agent - Foreign Foreign customers, which are income tax non withholding agents ITSW-L Contributor Condition ITW Responsibility IT non- withholding agent
Contributor IT Non- Withholding Agent - Foreign Foreign customers, which are income tax non withholding agents VAT Contributor Condition VAT status Foreign

Notes for defining tax condition classes for customers:

  1. You previously defined the ITW Responsibility and VAT status tax conditions as determining factor tax conditions for the ITWS-A, ITSW-L, and VAT tax categories for a contributor.

    See Associate Tax Categories with Tax Conditions for more information.

  2. Assign a condition value for the determining factors within each tax condition class.

  3. The values that you enter are IT withholding agent or IT non-withholding agent for ITWS-A and ITSW-L and National for VAT for national customers, and IT non-withholding agent for ITWS-A and ITSW-L and Foreign for VAT for foreign customers.

  4. Enter Contributor in the Class Type field and Contributor Condition in the Condition Type field, so that you can assign these conditions to customers.

Assign Tax Condition Classes to Customers

Use the globalization flexfield in the Contributor Class field in the Customer Addresses window to assign a contributor tax condition class to each of your customer addresses. The customer address inherits the values for the determining tax conditions associated with each tax category contained in the tax condition class.

Assign contributor tax condition classes to your customers according to this table:

Customer Class
Customer A (National and IT withholding agent) IT Withholding Agent - National
Customer B (National and IT non-withholding agent) IT Non-Withholding Agent - National
Customer C (Foreign) IT Non-Withholding Agent - Foreign

Assign Tax Condition Classes to Customer Address

After you assign the contributor tax condition classes to your customer addresses, use the Customer Site Profile window to copy the contributor tax condition class to each customer address. In this way, you can modify the contributor tax condition class values for each customer site.

You associate the tax condition class to customer addresses, because the Latin Tax Engine keeps this information at the customer address level. Since the income tax self withholding and VAT treatments do not depend on the customer location, you can assign the same tax condition class to all customer addresses for a specific customer.

To assign tax condition classes to customer addresses:

  1. Navigate to the Customer Site Profile window.

  2. Query the customer and customer sites that you want.

  3. Navigate to the Detail region.

    Oracle Receivables copies the contributor tax condition class values to each customer site.

  4. If necessary, modify the values that you want for each customer site.

  5. Save your work.

  6. Repeat steps 2 to 5 for each customer and customer site.

Define Tax Condition Classes for Transactions

Use the Latin Tax Condition Classes window to define tax condition classes for transactions to manage both income tax self withholding and VAT handling.

You need to define excluded and taxable tax condition classes to assign to transactions for each combination of income concept and VAT quality.

This table provides an example that you can apply to other income concepts:

Determining Tax Condition Case Income Concept VAT Quality
Excluded Service Services Excluded
Taxable Service Services Taxable
Excluded Good Goods Excluded
Taxable Good Goods Taxable
Taxable Good Professional Services Taxable

Each tax condition class contains all the values that determine the condition of each tax category for a transaction: income tax self withholding - asset (ITSW-A), income tax self withholding - liability (ITSW-L), and VAT.

After you create tax condition classes for transactions for both income tax self withholding and VAT handling, assign them to items and memo lines. See Assign Tax Condition Classes and Fiscal Classifications to Items and Assign Tax Condition Classes and Fiscal Classifications to Memo Lines for more information.

Create both excluded and taxable tax condition classes for transactions for each income concept according to these tables of examples:

EXAMPLE ONLY This data is not included in your installation

Taxable Good

Class Type Class Code Description Tax Category Condition Type Condition Code Value Code
Transaction Taxable Good Good that is subject to VAT ITSW-A Transaction Condition Income Concept Goods
Transaction Taxable Good Good that is subject to VAT ITSW-L Transaction Condition Income Concept Goods
Transaction Taxable Good Good that is subject to VAT VAT Transaction Condition VAT Quality Taxable

Notes for defining tax condition classes for transactions:

  1. You previously defined the Income Concept and VAT quality tax conditions as determining factor tax conditions for the ITWS-A, ITSW-L, and VAT tax categories for a transaction.

    See Associate Tax Categories with Tax Conditions for more information.

  2. In the Value Code field, assign a condition value for the determining factors within each tax condition class.

  3. Enter the same income concept for both ITWS-A and ITSW-L to create balanced entries. Enter Excluded for VAT for excluded tax condition classes, and Taxable for VAT for taxable tax condition classes.

  4. Enter Transaction in the Class Type field and Transaction Condition in the Condition Type field.

Excluded Service

Class Type Class Code Description Tax Category Condition Type Condition Code Value Code
Transaction Excluded Service Service that is not subject to VAT ITSW-A Transaction Condition Income Concept Services
Transaction Excluded Service Service that is not subject to VAT ITSW-L Transaction Condition Income Concept Services
Transaction Excluded Service Service that is not subject to VAT VAT Transaction Condition VAT Quality Excluded

Taxable Service

Class Type Class Code Description Tax Category Condition Type Condition Code Value Code
Transaction Taxable Service Service that is subject to VAT ITSW-A Transaction Condition Income Concept Services
Transaction Taxable Service Service that is subject to VAT ITSW-L Transaction Condition Income Concept Services
Transaction Taxable Service Service that is subject to VAT VAT Transaction Condition VAT Quality Taxable

Excluded Good

Class Type Class Code Description Tax Category Condition Type Condition Code Value Code
Transaction Excluded Good Good that is not subject to VAT ITSW-A Transaction Condition Income Concept Goods
Transaction Excluded Good Good that is not subject to VAT ITSW-L Transaction Condition Income Concept Goods
Transaction Excluded Good Good that is not subject to VAT VAT Transaction Condition VAT Quality Excluded

Define Fiscal Classifications

Use the Latin Fiscal Classifications window to define fiscal classifications for VAT tax rates. You need to define fiscal classifications for both items (Goods) and memo lines (Services).

You associate fiscal classifications with the VAT tax codes that you defined in the Tax Codes and Rates window. Associate the VAT tax code with the corresponding tax rate for each fiscal classification. See Define Tax Codes and Rates for more information.

Define fiscal classifications according to this table of an example. Actual assignments depend on the prevailing legislation.

Note: You do not need to assign a tax code to a fiscal classification code for excluded goods and services. The Latin Tax Engine does not look for the tax code for an excluded item or memo line if the tax group does not include excluded items and memo lines.

EXAMPLE ONLY This data is not included in your installation

Fiscal Classification Code Description Tax Category From Date Tax Code
Exempt Exempt Sales VAT 01/01/90 VAT-0
Excluded-G Excluded Goods VAT 01/01/90 N/A
Excluded-S Excluded Services VAT 01/01/90 N/A
Standard Standard Items VAT 01/01/90 VAT-1
Taxable-S Taxable Service VAT 01/01/90 VAT-1
Alcohol Alcohol VAT 01/01/90 VAT-2
Luxury Luxury Items VAT 01/01/90 VAT-3

Notes for defining fiscal classifications:

  1. Define as many fiscal classifications as you need for all VAT tax codes (rates).

  2. You can associate a VAT tax rate with more than one fiscal classification.

  3. You attach fiscal classifications to items to determine the VAT tax rate for the item.

  4. If you want the Latin Tax Engine to derive a VAT tax code from a fiscal classification, define a tax rule that looks for the VAT tax code in the fiscal classification. See Define Tax Rules for more information.

Assign Tax Condition Classes and Fiscal Classifications to Items

Use the Master Items window to assign a primary inventory item application, transaction tax condition class, and fiscal classification to each item. The item inherits the values for all tax conditions associated with each tax category from the tax condition class.

Assign the inventory item application AR (Oracle Receivables) to each item.

Assign a Goods fiscal classification code to each item. The Latin Tax Engine uses the fiscal classification code to find the tax code to apply, if the rule assignment directs the Latin Tax Engine to take the tax code from the fiscal classification.

You need to assign a fiscal classification code of excluded to items with this VAT condition.

Note: The Inflation Adjustment Account, Monetary Correction Account, and Sales Cost Account fields are not used for the Latin Tax Engine. These fields are used for inventory inflation adjustment in Oracle Inventory for Colombia. For more information, see Assign Inventory Inflation Adjustment Accounts to Items.

Use this table as a guideline for assigning combinations of items, fiscal classification codes, and condition classes. Actual fiscal classifications depend on the prevailing legislation.

Note: Use the income concept Goods for inventory items, because services or commissions are not stock items.

EXAMPLE ONLY This data is not included in your installation

Item Fiscal Classification Code Transaction Condition Class
Item 1 (Excluded) Excluded-G Excluded Good
Item 2 (Taxable item with a fiscal classification as Exempt) Exempt Taxable Good
Item 3 (Taxable item with the fiscal classification Standard) Standard Taxable Good
Item 4 (Taxable item with the fiscal classification Alcohol) Alcohol Taxable Good
Item 5 (Taxable item with the fiscal classification Luxury) Luxury Taxable Good

Assign Tax Condition Classes and Fiscal Classifications to Memo Lines

Use the Standard Memo Lines window to assign a transaction tax condition class and fiscal classification to each memo line. The memo line inherits the values for all tax conditions associated with each tax category from the tax condition class.

Assign a Service fiscal classification code to each memo line. The Latin Tax Engine uses the fiscal classification code to find the tax code to apply, if the rule assignment directs the Latin Tax Engine to take the tax code from the fiscal classification.

You need to assign a fiscal classification code of excluded to memo lines with this VAT condition.

Use this table as a guideline for assigning combinations of memo lines, fiscal classification codes, and condition classes. Actual fiscal classifications depend on the prevailing legislation.

EXAMPLE ONLY This data is not included in your installation

Memo Line Fiscal Classification Code Transaction Condition Class
Consulting Services Excluded-S Excluded Service
Professional Fees Exempt Taxable Service
Architecture Fees Taxable-S Taxable Service
Professional Services Taxable-S Taxable Service
Professional Services-N.A. Taxable-S Taxable Service
Professional Services-S.A. Excluded-S Excluded Service
Professional Services-Colombia Exempt Taxable Service
Professional Services-U.S. Taxable-S Taxable Service
Packing Services Taxable-S Taxable Service
Shipping Services Taxable-S Taxable Service

Define Tax Group

Use the Latin Tax Groups window to define a tax group for income tax self withholding and VAT. Create assignments in the tax group for each combination of organization, contributor, and transaction condition values subject to either income tax self withholding or VAT.

After you create a tax group for income tax self withholding and VAT, assign the tax group to each transaction type. See Assign Tax Group to Transaction Types for more information.

The Latin Tax Engine determines which income tax self withholding and VAT taxes to calculate for a specific transaction based on the combination of values for the organization, contributor, and transaction determining conditions. These sections contain guidelines for determining both income tax self withholding and VAT. Use these guidelines when you create the tax group.

Note: These guidelines are not intended as a tax guide for Colombia. You should review the prevailing tax legislation before you set up Oracle Receivables to handle taxes.

Income Tax Self Withholding

Income tax self withholding for a specific income concept applies to a transaction when:

You must include an assignment for each combination of:

You can assign a tax code and a minimum taxable amount for each combination of values. The Latin Tax Engine uses this information to determine the tax rate and tax amount, when the transaction is greater than or equal to the minimum taxable amount.

VAT

VAT is charged on an issued invoice in the following cases:

Case 1

In this case, the items are taxed according to their fiscal classifications.

Case 2

In this case, the items are taxed with a 0% VAT rate.

You must include an assignment for the following combinations:

Combination 1

In this case, because the tax code comes from the item's fiscal classification, you do not need to assign a tax code to the combination within the tax group.

Combination 2

In this case, you must charge a 0% VAT rate to the items. Assign a 0% VAT tax code to the combination within the tax group. The Latin Tax Engine takes the tax code from the tax group.

Define a single tax group for all income tax self withholding and VAT calculations in Colombia according to the following example. This example shows:

Actual assignments depend on the prevailing legislation. This table provides an example.

EXAMPLE ONLY This data is not included in your installation

Tax Group: CO_TAX Description: Colombian tax group

Tax Category Contributor Value Organization Value Transaction Value Effective From Effective To Tax Code Minimum Amount Minimum Taxable Basis
ITSW-A IT withholding agent IT self- withholder Goods 01/01/90 Default Goods- Debit None -300.000
ITSW-L IT withholding agent IT self- withholder Goods 01/01/90 Default Goods None 300.000
ITSW-A IT withholding agent IT self- withholder Services 01/01/90 Default Services-Debit None -400.000
ITSW-L IT withholding agent IT self- withholder Services 01/01/90 Default Services None 400.000
VAT National Common Regime Taxable 01/01/90 Default None None None
VAT Foreign Common Regime Excluded 01/01/90 Default VAT-0 None None
VAT Foreign Common Regime Taxable 01/01/90 Default VAT-0 None None

Notes for defining the tax group:

  1. Create two assignments for each income concept that the organization is an income tax self-withholder for.

    Assign the credit tax code to the liability tax category. Assign the debit tax code to the asset tax category.

  2. The tax code that you enter in the Tax Code field for a tax category is used to derive the tax rate for a transaction only when the tax rule looks to the tax group for the tax rate (tax rule: Latin Tax Group).

    See Define Tax Rules or more information.

  3. The minimum taxable amount is the same for both assignments. You must maintain the invoice amounts that are unaffected by the income tax self withholding.

  4. Minimum tax amounts are not used in Colombia for income tax self withholding. Minimum taxable amounts and minimum tax amounts do not apply to VAT.

Assign Tax Group to Transaction Types

Use the Transaction Types window to assign the tax group that you defined for income tax self withholding and VAT to each transaction type in the Tax Code field. Transactions created with transaction types inherit the tax group.

Assign the tax group to your transaction types according to this table of an example:

EXAMPLE ONLY This data is not included in your installation

Transaction Type Tax Code
Transaction Type 1 CO_<NAME>
Transaction Type 2 CO_<NAME>
Transaction Type 3 CO_<NAME>

Define Tax Rules

Use the Tax Rules window to define one or more tax rules for each combination of tax category, contributor condition value, and transaction type. The Latin Tax Engine uses these rules to determine the correct tax code to apply to a transaction. Define as many tax rules as you require.

For example, if you want the Latin Tax Engine to derive a tax code from a tax category, define a tax rule that looks for the tax code in the tax category.

Income Tax Self Withholding

For income tax self withholding, you need to define pairs of rules for both asset and liability, and for the two contributor condition values of withholding agent and non-withholding agent. Define tax rules for income tax self withholding in the following combinations:

This table provides an example of the minimum number of income tax self withholding tax rules to define for two transaction types and the first tax rule hierarchy (Latin Tax Group):

EXAMPLE ONLY This data is not included in your installation

Category Value Transaction Type Rule Level Priority Rule
ITSW-A Withholding Agent Transaction Type 1 Rate 1 Latin Tax Group
ITSW-A Non-Withholding Agent Transaction Type 1 Rate 1 Latin Tax Group
ITSW-L Withholding Agent Transaction Type 1 Rate 1 Latin Tax Group
ITSW-L Non-Withholding Agent Transaction Type 1 Rate 1 Latin Tax Group
ITSW-A Withholding Agent Transaction Type 2 Rate 1 Latin Tax Group
ITSW-A Non-Withholding Agent Transaction Type 2 Rate 1 Latin Tax Group
ITSW-L Withholding Agent Transaction Type 2 Rate 1 Latin Tax Group
ITSW-L Non-Withholding Agent Transaction Type 2 Rate 1 Latin Tax Group

Notes for defining income tax self withholding tax rules:

  1. To define a default tax rule, enter Default in the Value field and the default transaction type in the Transaction Type field which instructs the Latin Tax Engine to use this rule as the default tax rule. The default transaction type corresponds to the transaction type that you entered in the Receivables System Options window.

  2. Enter Rate in the Rule Level fields which instructs the Latin Tax Engine to retrieve the tax code for the rate.

  3. Enter 1 in the Priority fields. There is only one rule assignment for each combination of values.

  4. Enter the rule to use in the Rule fields.

    Note: If you enter the rule Latin Tax Group, the Latin Tax Engine is instructed to take the tax code from the tax group. In this case, enter a tax code in the Tax Code field in the Latin Tax Groups window. See Define Tax Group for more information.

VAT

For VAT, you must define a pair of tax rules for each transaction type for the two contributor condition values of national and foreign contributors.

Your tax rules for VAT should include Latin Tax Group, Fiscal Classification, and Customer Exception, if you want the Latin Tax Engine to consider exceptions for your contributors.

This table provides an example of a hierarchy with two tax rules for the two contributor condition values and one transaction type:

EXAMPLE ONLY This data is not included in your installation

Category Value Transaction Type Rule Level Priority Rule
VAT National Transaction Type 1 Rate 1 Latin Tax Group
VAT National Transaction Type 1 Rate 2 Fiscal Classification
VAT Foreign Transaction Type 1 Rate 1 Latin Tax Group
VAT Foreign Transaction Type 1 Rate 2 Fiscal Classification

Notes for defining VAT tax rules:

  1. To define a default tax rule, enter Default in the Value field and the default transaction type in the Transaction Type field which instructs the Latin Tax Engine to use this rule as the default tax rule. The default transaction type corresponds to the transaction type that you entered in the Receivables System Options window.

  2. Enter Rate in the Rule Level fields which instructs the Latin Tax Engine to retrieve the tax code for the rate instead of the tax code for the base modifier.

  3. Enter 1 in the first Priority field and 2 in the second Priority field.

Entering Transactions

Use the globalization flexfield in the Lines window to enter the fiscal classification code and transaction condition class for each invoice line. The Latin Tax Engine uses the fiscal classification code and transaction condition class to calculate income tax self withholding and VAT for each invoice line.

To enter a fiscal classification code and transaction condition class:

  1. Navigate to the Transactions window.

  2. Enter an invoice.

    Oracle Receivables defaults the tax group from the transaction type.

  3. Navigate to the Lines window by pressing the Line Items button.

  4. Enter an invoice line.

  5. Navigate to the More tabbed region.

  6. If the invoice line is an item line, enter the warehouse name in the Warehouse Name field to define an item validation organization for your ship-from location.

    Note: If you selected Latin Tax Handling as your tax method in the System Options window, the Warehouse Name field is mandatory only if the invoice line is an item line.

  7. Navigate to the globalization flexfield.

    When you open the globalization flexfield, the Latin Tax Engine populates the fields with the default fiscal classification code and transaction condition class. These attributes are defaulted from the master inventory organization's item definition. You define the master inventory organization in the Order Management Parameters window.

    For more information about assigning a transaction condition class and fiscal classification to items, see Assign Tax Condition Classes and Fiscal Classifications to Items.

    You can accept the default fiscal classification code and transaction condition class for the invoice line by pressing the OK button, or you can replace the defaults with other valid values.

  8. Press the OK button.

  9. Save your work.

    Oracle Receivables calculates the associated tax rate and amount.

    Note: When entering credit transactions, setting up recurring invoices, or using the Copy and Void Invoices process, the Warehouse Name field on the original invoice lines is mandatory only if the invoice line is an item line and you selected Latin Tax Handling as your tax method in the System Options window.

Related Topics

Entering Transactions, Oracle Receivables User Guide

Defining Order Management System Parameters, Oracle Order Management Implementation Guide

Self Withholding Income Tax Example

This example shows how Oracle Receivables for Colombia calculates and accounts for income tax self withholding on an invoice when a customer is responsible for withholding and your company is an income tax self-withholder.

Your company, ABC Services (NIT 123456789), sends the invoice shown by this table to XYZ Customer (NIT 987654321) who purchased services and goods:

Item Amount
Product A (Software) 2000
Service X (Consulting) 3000
Income tax on software 320
Income tax on consulting 480
Income tax total 880
Invoice Total 6380

Income tax self withholding is calculated for each income concept with the parameter in this table:

Income Concept Percentage Minimal Amount for Calculating Tax
Services 10% 2500
Goods 3% 1500

The invoice amounts for each income concept are compared with the minimum amount for calculating tax. Since the services amount of 3000.00 is greater than the minimum amount of 2500.00, for example, income tax self withholding is calculated for services as shown in this table:

Item Amount
Sum of all services on invoice 3000
Self withholding rate for services 10%
Self withholding amount 300

Income tax self withholding is calculated for goods as shown in this table:

Item Amount
Sum of all goods on invoice 2000
Self withholding rate for goods 3%
Self withholding amount 60

Oracle Receivables adds the self-withheld amount to a prepaid income tax asset account and adds the same amount to an income tax liability account. This table shows the account information.

Account Debit Credit NIT
     Revenue   5000 98765432
Accounts Receivable 5000   98765432
Income Tax Self Withholding - Services (Asset) 300   98765432
     Income Tax Self Withholding -      Services (Liability)   300 98765432
Income Tax Self Withholding - Goods (Asset) 60   98765432
     Income Tax Self Withholding -      Goods (Liability)   60 98765432

The customer can use Oracle Payables to account for the invoice payment, as shown in this table:

Account Debit Credit NIT
     Accounts Payable   5000 98765432
Expense 5000   98765432

Colombian Receivables Income Tax Self Withholding Report

If you use the Latin Tax Engine for income tax self withholding, you can use the Colombian Receivables Income Tax Self Withholding report to list self withholding tax details for a particular accounting period for audit purposes. The Colombian Receivables Income Tax Self Withholding report lists all the transactions during the period that were subject to income tax self withholding and shows the taxable base amount and self-withheld amount for each transaction.

The Colombian Receivables Income Tax Self Withholding report includes only transactions whose transaction class is Invoice, Debit Memo, or Credit Memo and whose status is Completed.

To meet Colombian legal requirements, the Colombian Receivables Income Tax Self Withholding report must show all transaction amounts as the amounts were originally printed on the invoice. Adjustments do not appear on the report. If you need to make an adjustment to an invoice, you should create a credit memo against the original invoice and enter a new invoice with the correct amounts.

Oracle Receivables groups transactions by income concept on the Colombian Receivables Income Tax Self Withholding report. For each income concept, the report displays the name and description of the tax code associated with the concept, the accounting flexfield associated with the tax code, and the tax rate. You can choose which income concepts to include on the report by entering the corresponding accounting flexfield range in the report parameters.

Within each income concept, Oracle Receivables groups sales transactions by transaction class and prints the transaction classes in this order: Credit Memos, Debit Memos, Invoices. Within each transaction class, transactions are ordered by transaction batch source and transaction number.

The Colombian Receivables Income Tax Self Withholding report lets you determine the income tax that you self-withheld for an entire operation. An operation consists of several related transactions on which income tax self withholding is calculated. For example, an operation can contain one or more credit memos associated with an invoice. In Colombia, withholding thresholds are compared to the total sales amount on an entire operation to determine the income tax self withholding amount.

To provide a clear audit trail, the Colombian Receivables Income Tax Self Withholding report provides operation information at the transaction level. A unique operation is identified by the combination of transaction number and transaction batch source. Operation information at the transaction level lets you reference all transactions belonging to an operation to the original invoice.

Oracle Receivables provides the Colombian Receivables Income Tax Self Withholding report to show supporting information for your income tax self withholding liability. In order to display liability information, you should choose the tax category that you use for income tax self withholding liability when you submit the report.

Use the Standard Request Submission windows to submit the Colombian Receivables Income Tax Self Withholding report.

Prerequisites

Before you run the Colombian Receivables Income Tax Self Withholding report, you must:

Report Parameters

Period

Enter the accounting period that you want to report on.

Tax Category

Enter the tax category for income tax self withholding liability.

Tax Account From

Enter the starting value of the accounting flexfield range corresponding to the income concepts you want to include on the report.

Tax Account To

Enter the ending value of the accounting flexfield range corresponding to the income concepts you want to include on the report.

Report Headings

In this heading… Oracle Receivables prints…
<Ledger> The ledger name
Tax Category The tax category name and description
Flexfield From The starting value for the accounting flexfield range
To The ending value for the accounting flexfield range
<Report Title> Income Tax Self Withholding Report
Period The accounting period
Date The date and time that you ran the report
Page The current and total pages of the report

Column Headings

In this column… Oracle Receivables prints…
Invoice Number The transaction number.
Operation - Transaction Number For credit memos only, the number of the credited transaction.
Operation - Transaction Batch Source For credit memos only, the transaction batch source of the credited transaction.
Third Party Identifier The customer's third party identifier.
Customer Name The customer name.
Date The transaction date.
Base Amount The taxable base for income tax self withholding. The taxable base is the sum of the extended amounts of all the transaction lines that correspond to the income concept associated with the tax code.
Self Withholding Amount The amount that was self-withheld for this income concept.

Row Headings

In this row… Oracle Receivables prints…
Tax Code The name and description of the tax code associated with the income concept
Tax Rate The tax rate for the tax code
Account The accounting flexfield and description associated with the tax code
Transaction Class The transaction class
Transaction Batch Source The transaction batch source
Total Transaction Batch Source The transaction batch source name and the totals for the transaction batch source
Total Transaction Class The transaction class name and the totals for the transaction class
Total Tax Code The tax code name and the totals for the tax code
Report Totals The totals for the report

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Defining the VAT Tax Category

In Colombia, companies are required to report VAT information on the Colombian Receivables Sales Fiscal Book report. If you use the Latin Tax Engine, you must distinguish VAT tax lines in your transactions from income tax self withholding tax lines. Only VAT lines should be included in the VAT amount on the Colombian Receivables Sales Fiscal Book report. To identify tax lines as VAT, you must define the VAT tax category. Use the globalization flexfield in the System Options window to define the VAT tax category.

Note: If you do not use the Latin Tax Engine, you do not need to define the VAT tax category. In this case, Oracle Receivables treats all tax lines as VAT lines and includes all the tax lines in the VAT amount on the Colombian Receivables Sales Fiscal Book report.

To define the VAT tax category:

  1. Navigate to the System Options window.

  2. Navigate to the globalization flexfield.

  3. In the VAT Tax Category field, enter the Latin tax category that you set up in the Latin Tax Engine to identify your VAT tax lines.

    Note: The remaining fields in the globalization flexfield are not used for the VAT tax category. These fields are used for the Latin Tax Engine.

  4. Choose the OK button to save your work.

Related Topics

Defining Receivables System Options, Oracle Receivables User Guide

Colombian Receivables Sales Fiscal Book Report

In Colombia, companies are legally required to report sales transactions on the Colombian Receivables Sales Fiscal Book report. The Colombian Receivables Sales Fiscal Book report includes all completed credit memos, debit memos, and invoices for a given accounting period. For each transaction, the Colombian Receivables Sales Fiscal Book report shows the extended amount, the VAT amount, and the total amount.

Voided transactions are included on the Colombian Receivables Sales Fiscal Book report but do not affect the report amounts. Voided transactions are labeled VOID and always have an amount of zero.

If you use the Latin Tax Engine, you must identify the tax lines in your transactions that are VAT lines and should be included in the VAT amount on the Colombian Receivables Sales Fiscal Book report. To identify tax lines as VAT, you must define the VAT tax category. For more information, see Defining the VAT Tax Category.

If you do not use the Latin Tax Engine, Oracle Receivables treats all tax lines as VAT lines and includes all the tax lines in the VAT amount on the Colombian Receivables Sales Fiscal Book report.

The Colombian Receivables Sales Fiscal Book report includes only transactions whose transaction class is Invoice, Debit Memo, or Credit Memo and whose status is Complete.

To meet Colombian legal requirements, the Colombian Receivables Sales Fiscal Book report must show all transaction amounts as the amounts were originally printed on the invoice. Adjustments do not appear on the report. If you need to make an adjustment to an invoice, you should create a credit memo against the original invoice and enter a new invoice with the correct amounts.

Oracle Receivables groups sales transactions by transaction class and prints the transaction classes in this order: Credit Memos, Debit Memos, Invoices. Within each transaction class, transactions are ordered by transaction batch source and transaction number.

Use the Standard Request Submission windows to submit the Colombian Receivables Sales Fiscal Book report.

Prerequisites

Before you run the Colombian Receivables Sales Fiscal Book report, you must:

Report Parameters

Period

Enter the accounting period that you want to report on.

Report Headings

In this heading… Oracle Receivables prints…
<Ledger> The ledger name
<Report Title> Sales Fiscal Report
Period The accounting period
Report Date The date and time that you ran the report
Page The current and total pages of the report

Column Headings

In this column… Oracle Receivables prints…
Transaction - Date The transaction date
Transaction - Number The transaction number
Customer Name The customer name, or VOID for a void transaction
Third Party ID The customer's third party identifier
Extended Amount The total amount of the transaction lines, including freight and charge lines
VAT Amount The total amount of the VAT lines
Total Amount The total amount of all lines for the transaction, calculated by adding the extended amount and the VAT amount

Row Headings

In this row… Oracle Receivables prints…
Transaction Class The transaction class
Transaction Batch Source The transaction batch source
Total Transaction Batch Source The transaction batch source name and the totals for the transaction batch source
Total Transaction Class The transaction class name and the totals for the transaction class
Totals The totals for the report

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Colombian Receivables Cash Receipt Report

In Colombia, companies are legally required to issue a cash receipt document each time a payment is received. Use the Colombian Receivables Cash Receipt report to print cash receipts that you can send to your customers as a confirmation that payments were received for processing.

The Colombian Receivables Cash Receipt report shows information about the company issuing the report, the customer, and the receipt.

The receipt information includes the payment mode for the receipt. The payment mode is the mechanism that the customer used to make the payment, such as cash, check, credit card, debit card, or wire transfer. You can enter the payment mode for a payment method in the Printed Name field when you define the payment method in the Receipt Classes window. Oracle Receivables displays the printed name for the payment method of the receipt as the payment mode on the Colombian Receivables Cash Receipt report.

The Colombian Receivables Cash Receipt report also shows details about the application of the receipt. Oracle Receivables prints one line for each transaction to which the receipt was applied, as well as one line for on-account amounts and another line for unapplied amounts. The Colombian Receivables Cash Receipt report is ordered by receipt number and transaction number.

Oracle Receivables does not print the Colombian Receivables Cash Receipt report for miscellaneous or unidentified receipts, since customer information is not available for these receipts.

Use the Standard Request Submission windows to submit the Colombian Receivables Cash Receipt report.

Prerequisites

Before you run the Colombian Receivables Cash Receipt report, you must:

Report Parameters

Receipt Date From

Enter the starting value for the receipt date range that you want to include on the report.

Receipt Date To

Enter the ending value for the receipt date range that you want to include on the report.

Receipt Number From

Enter the starting value for the receipt number range that you want to include. Leave the Receipt Number From and To parameters blank to include all receipt numbers.

Receipt Number To

Enter the ending value for the receipt number range that you want to include. Leave the Receipt Number From and To parameters blank to include all receipt numbers.

Customer Name From

Enter the starting value for the customer name range that you want to include. Leave the Customer Name From and To parameters blank to include all customer names.

Customer Name To

Enter the ending value for the customer name range that you want to include. Leave the Customer Name From and To parameters blank to include all customer names.

Customer Number From

Enter the starting value for the customer number range that you want to include. Leave the Customer Number From and To parameters blank to include all customer numbers.

Customer Number To

Enter the ending value for the customer number range that you want to include. Leave the Customer Number From and To parameters blank to include all customer numbers.

Third Party ID From

Enter the starting value for the customer third party ID range that you want to include. Leave the Third Party ID From and To parameters blank to include all customer third party IDs.

Third Party ID To

Enter the ending value for the customer third party ID range that you want to include. Leave the Third Party ID From and To parameters blank to include all customer third party IDs.

Payment Method

Enter the payment method of the receipts that you want to include. Leave the Payment Method parameter blank to include all payment methods.

Payment Mode

Enter the payment mode of the receipts that you want to include. The payment mode of a receipt is the printed name you defined for the payment method of the receipt. Leave the Payment Mode parameter blank to include all payment modes.

Report Headings

In this heading... Oracle Receivables prints...
<Report Title> Cash Receipt
Report Date The date and time that you ran the report
Page The current and total pages of the report
Company Name Your company name
Company Taxpayer ID Your taxpayer ID
Address Your address
Customer The customer name
Third Party ID The customer third party ID
Address The customer bill-to address associated with the receipt
Receipt Number The receipt number
Receipt Date The receipt date
Payment Method The payment mode that you defined as the printed name for the payment method of the receipt
Receipt Amount The receipt amount
Currency The receipt currency

Column Headings

In this column... Oracle Receivables prints...
Transaction Number The transaction number to which the receipt was applied. Oracle Receivables prints On Account for on-account amounts and Unapplied for unapplied amounts.
Transaction Date The transaction date. Oracle Receivables leaves this column blank for on-account and unapplied amounts.
Applied Amount The amount applied to this transaction, or the on-account or unapplied amount.

Row Headings

In this row... Oracle Receivables prints...
Receipt Amount The total amount of the receipt, including applied, on-account, and unapplied amounts.

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Payment Methods, Oracle Receivables User Guide

Miscellaneous System Options, Oracle Receivables User Guide

Oracle Assets

Inflation Adjustment Overview

In Colombia, since 1992, companies must adjust the cost and accumulated depreciation amounts of their assets for inflation. The adjustments must be performed at the beginning of the depreciation period and must be recorded in fixed asset inflation adjustment accounts according to the Chart of Accounts defined by the Colombian government. In this Chart of Accounts, fixed asset inflation adjustment accounts are identified by codes of the form 15XX99. The first two digits, 15, represent fixed assets accounts; the next two digits represent the asset category; and the last two digits, 99, represent inflation adjustment accounts.

The Colombian government requires companies to report historical amounts for their assets as well as inflation-adjusted amounts. To satisfy this requirement, choose the historical/adjusted option in Oracle Assets. The historical/adjusted option lets you maintain and report both historical amounts and inflation-adjusted amounts by using two separate depreciation books. Keep the historical amounts in a corporate book and the inflation-adjusted amounts in a tax book.

In Colombia, you can implement inflation adjustment in Oracle Assets without implementing inflation adjustment in General Ledger. The Colombian Chart of Accounts lets you maintain historical amounts and inflation adjustment amounts in different accounts within the same General Ledger ledger.

Transfer all your historical asset information to General Ledger from the historical depreciation book using the standard Create Journal Entries process. Then use the Colombian Fixed Assets Transfer to General Ledger process to transfer only inflation adjustment transactions from the adjusted depreciation book to General Ledger. For more information about transferring Oracle Assets information to General Ledger in Colombia, see Transferring Inflation Adjustment Journal Entries to General Ledger to General Ledger.

Note: You can implement Multiple Reporting Currencies (MRC) while using the historical/adjusted option in Oracle Assets by using the historical book as your MRC primary book. You must not use the adjusted depreciation book as your MRC primary book because the inflation adjustment transactions must not be included when MRC converts your transactions to another currency. Using the historical book as your MRC primary book ensures that you maintain only the correct transactions in your MRC reporting book.

Basic Business Needs

In addition to the inflation adjustment business needs described in the Oracle Financials Common Country Features User Guide, Oracle Assets for Colombia provides you with features to satisfy these basic business needs. You can:

Major Features

In addition to the inflation adjustment features described in the Oracle Financials Common Country Features User Guide, Oracle Assets for Colombia provides these features:

Inflation Adjustment Accounts

You can record the inflation adjustments to cost and accumulated depreciation for your assets in separate accounts from the original accounts for these components. You define the inflation adjustment accounts at asset category level.

Journal Categories

You can specify journal categories at depreciation book level to identify inflation adjustment journal entries when the journal entries are posted in General Ledger.

Inflation Adjustment of CIP Assets

You must adjust the cost amounts for CIP assets for inflation according to the general rules for fixed assets. The offset of the inflation adjustment, however, is not credited to the regular monetary correction account but to a deferred monetary correction credit account. You can adjust your CIP assets for inflation regularly once each depreciation period.

Deferred Monetary Correction Credit

You can offset inflation adjustments to the cost of CIP assets by charging the deferred monetary correction credit account. After you capitalize a CIP asset, the balance of the deferred monetary correction credit account is amortized over the life of the asset.

Deferred Depreciation

You can adjust deferred depreciation balances for inflation and amortize the adjustment over the life of the asset along with the original balance.

Transfer of Inflation Adjustment Balances

You can use the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program to transfer or retire the amounts in inflation adjustment accounts along with the original amounts when assets are reclassified, transferred, retired, or reinstated. This process complements the standard transfer of balances for standard Oracle Assets accounts.

Reports for Inflation Adjustment Information

You can run standard Oracle Assets reports to meet Colombian reporting requirements for the Major Book of Capitalized Assets with Inflation Adjustments, the Major Book of CIP Assets with Inflation Adjustments, and Assets Retired in a Period with Inflation Adjustment Information. You can also use these reports to show information for assets with deferred depreciation balances, deferred monetary correction credit balances, or deferred monetary correction charge balances.

Additionally, Oracle Assets for Colombia provides these special reports to show inflation adjustment information:

Purge Process

You can use the Colombian Fixed Asset Purging process to archive, delete, and recover obsolete information in the inflation adjustment tables following the guidelines established by the standard purging process.

Inflation Adjustment Setup

This section describes how to set up Oracle Assets for Colombia for the inflation adjustment process. Use this checklist to help you complete the appropriate steps.

Define Journal Categories

You must define new journal categories in General Ledger for inflation adjustment. The journal categories help you identify the nature of inflation adjustment journal entries when you post the journal entries in General Ledger. Define journal categories for these kinds of journal entries:

Related Topics

Defining Journal Categories, Oracle General Ledger User Guide

Set Up Depreciation Books

Use the Book Controls window and the globalization flexfield to set up your depreciation books for inflation adjustment. You can enable or disable inflation adjustment at depreciation book level. If you enable inflation adjustment for a depreciation book, you can choose to enable or disable inflation adjustment for individual asset categories and assets when you define them. If you disable inflation adjustment for a depreciation book, none of the assets in that book can be adjusted.

Oracle Financials for Colombia also lets you use the globalization flexfield to define the journal categories that you want to use for your inflation adjustment journal entries when you transfer the journal entries to General Ledger. Select the General Ledger journal categories that you defined for inflation adjustment.

To set up depreciation books:

  1. Navigate to the Book Controls window.

  2. Enter a depreciation book.

  3. Navigate to the globalization flexfield.

  4. Enter Yes in the Adjust for Inflation field to enable inflation adjustment for assets in this depreciation book. Enter No to disable inflation adjustment for all assets in this book.

  5. In the Inflation Adjustment Journal Category field, enter the journal category for your inflation adjustment journal entries.

  6. In the Inflation Adjustment Reclassification Journal Category field, enter the journal category for your inflation adjustment reclassification journal entries.

  7. In the Inflation Adjustment CIP Reclass Journal Category field, enter the journal category for your inflation adjustment CIP reclassification journal entries.

  8. In the Inflation Adjustment Transfer Journal Category field, enter the journal category for your inflation adjustment transfer journal entries.

  9. In the Inflation Adjustment CIP Transfer Journal Category field, enter the journal category for your inflation adjustment CIP transfer journal entries.

  10. In the Inflation Adjustment Retirements Journal Category field, enter the journal category for your inflation adjustment retirement journal entries.

  11. In the Inflation Adjustment CIP Retirements Journal Category field, enter the journal category for your inflation adjustment CIP retirement journal entries.

  12. In the Inflation Adjustment Addition Journal Category field, enter the journal category for your inflation adjustment addition journal entries.

  13. In the Inflation Adjustment CIP Addition Journal Category field, enter the journal category for your inflation adjustment CIP addition journal entries.

  14. In the Inflation Adjustment - Adjustment Journal Category field, enter the journal category for your inflation adjustment cost adjustment journal entries.

  15. In the Inflation Adjustment CIP Adjustment Journal Category field, enter the journal category for your inflation adjustment CIP cost adjustment journal entries.

  16. In the CIP Inflation Adjustment Journal Category field, enter the journal category for your CIP inflation adjustment journal entries.

    After you perform inflation adjustment for this book, you can view information about the most recent inflation adjustment processes in the next four fields. Oracle Assets displays the period name for the most recent inflation adjustment in the Last Inflation Adjustment Period field, and the revaluation ID for the most recent inflation adjustment in the Last Inflation Adjustment field.

    The period name for the most recent time you ran the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program appears in the Last Closed Period field. The period name for the most recent time you ran the Colombian Fixed Assets Transfer to General Ledger process appears in the Last Transferred Period field.

    Note: The Technical Appraisal Journal Category field in the globalization flexfield is not used for inflation adjustment. This field is used for technical appraisal in Oracle Assets for Colombia. For more information, see Assign the Technical Appraisal Journal Category.

  17. Press the OK button.

  18. In the Book Controls window, navigate to the Calendar tabbed region.

  19. In the GL Ledger field, select the General Ledger ledger that you want to transfer this depreciation book's journal entries to.

  20. Complete the Allow GL Posting check box according to your depreciation book's requirements.

    If you are using the historical/adjusted option in Oracle Assets, check the Allow GL Posting check box for your historical book so that you can use the standard Create Journal Entries process to transfer asset information from the historical book to General Ledger. Do not check the Allow GL Posting check box for your adjusted book, since you use only the country-specific Colombian Fixed Assets Transfer to General Ledger process to transfer inflation adjustment transactions from the adjusted depreciation book to General Ledger. For more information, see Transferring Inflation Adjustment Journal Entries to General Ledger.

  21. Navigate to the Accounting Rules tabbed region.

  22. If you want to allow revaluation in this book, check the Allow Revaluation check box.

  23. If you want to revalue accumulated depreciation, check the Revalue Accumulated Depreciation check box.

  24. If you want to revalue year-to-date depreciation, check the Revalue YTD Depreciation check box. In Colombia, you usually do not revalue year-to-date depreciation.

  25. If you want to retire revaluation reserve, check the Retire Revaluation Reserve check box. In Colombia, you usually do not retire revaluation reserve.

  26. If you want to amortize revaluation reserve, check the Amortize Revaluation Reserve check box. In Colombia, you usually do not amortize revaluation reserve.

  27. If you want to revalue fully reserved assets, check the Revalue Fully Reserved Assets check box.

    If you choose to revalue fully reserved assets, enter a life extension factor in the Life Extension Factor field. To maintain the current asset life without extending it, enter 1. You can also enter the maximum number of times an asset can be revalued as fully reserved in the Maximum Revaluations field and enter a life extension ceiling in the Life Extension Ceiling field.

  28. Navigate to the Tax Rules region.

  29. If you are defining a tax book and you want to include CIP assets in the tax book, check the Allow CIP Assets check box. You must include CIP assets in your adjusted tax book, if you are using the historical/adjusted option, so that you can adjust the CIP assets for inflation in the adjusted tax book.

  30. Save your work.

Related Topics

Defining Depreciation Books, Oracle Assets User Guide

Asset Management in a Highly Inflationary Economy (Revaluation), Oracle Assets User Guide

Construction-in-Process (CIP) Assets, Oracle Assets User Guide

Set Up Asset Categories

Use the Asset Categories window with the globalization flexfield and the Default Depreciation Rules window to set up your asset categories for inflation adjustment. In the Asset Categories window, you can specify the revaluation reserve account that the inflation adjustment process uses to offset the inflation adjustments for assets in a category in a particular depreciation book.

Note: You must enter a revaluation reserve account in order to run the inflation adjustment process. After you run the inflation adjustment process, however, you can use the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program to assign inflation adjustment and offset amounts to the correct accounts according to Colombian requirements.

In the globalization flexfield, you can enable or disable inflation adjustment for the asset category in a particular depreciation book. If you enable inflation adjustment for an asset category in a book, you can choose to enable or disable inflation adjustment for individual assets when you define the assets. If you disable inflation adjustment for an asset category in a book, none of the assets in that category can be adjusted in that book.

In this way, you can choose to adjust an asset category in one depreciation book while preventing the same asset category from being adjusted in another book. You can also choose to adjust some asset categories in a depreciation book for inflation while preventing other categories in the same book from being adjusted.

If inflation adjustment is disabled for an entire depreciation book, however, none of the asset categories in that book can be adjusted.

Oracle Financials for Colombia also lets you use the globalization flexfield in the Asset Categories window to define the natural accounts used to store the inflation adjustment and monetary correction amounts for your assets. The Account Generator derives the complete accounting flexfield combinations for your inflation adjustment journal entries by following the rules that you set up for the corresponding standard asset accounts, but replacing the natural account segment with the natural accounts that you enter for inflation adjustment.

This table shows the standard asset account that the Account Generator follows for different inflation adjustment accounts.

For this inflation adjustment account… The Account Generator follows the rules set up for this standard asset account…
Inflation Adjustment Cost Asset Cost
Indexing Cost Asset Cost
Inflation Adjustment Depreciation Reserve Depreciation Reserve
Indexing Depreciation Reserve Depreciation Reserve
Inflation Adjustment CIP Cost Construction-In-Process Cost
Deferred Indexing CIP Cost Construction-In-Process Cost

In the Default Depreciation Rules window, you can assign a price index to the asset category. The price index is used to calculate the inflation rate for all the assets in this asset category.

To set up asset categories:

  1. Navigate to the Asset Categories window.

  2. Enter an asset category.

  3. Navigate to the General Ledger Accounts region.

  4. Enter a depreciation book in the Book field.

  5. Enter a revaluation reserve account in the Revaluation Reserve field.

  6. Navigate to the globalization flexfield.

  7. Enter Yes in the Adjust for Inflation field to enable inflation adjustment for assets in this asset category. Enter No to disable inflation adjustment for all assets in this category.

    If inflation adjustment is enabled for this depreciation book, the Adjust for Inflation field defaults to Yes. Otherwise, the Adjust for Inflation field defaults to No.

  8. In the Inflation Adjustment Cost Account field, enter the natural account where you want to record the inflation adjustments to the cost of your capitalized assets.

  9. In the Indexing Cost Account field, enter the natural account where you want to record the monetary corrections to the cost of your capitalized assets.

  10. In the Inflation Adjustment Depreciation Reserve Account field, enter the natural account where you want to record the inflation adjustments to the accumulated depreciation of your capitalized assets.

  11. In the Indexing Depreciation Reserve Account field, enter the natural account where you want to record the monetary corrections to the accumulated depreciation of your capitalized assets.

  12. In the Inflation Adjustment CIP Cost Account field, enter the natural account where you want to record the inflation adjustments to the cost of your CIP assets.

  13. In the Deferred Indexing CIP Cost Account field, enter the natural account where you want to record the deferred monetary correction credits to the cost of your CIP assets.

  14. Press the OK button.

    Note: The remaining fields in the globalization flexfield are not used for inflation adjustment. These fields are used for technical appraisal in Oracle Assets for Colombia. For more information, see Define Technical Appraisal Accounts.

  15. Press the OK button.

  16. In the Asset Categories window, press the Default Rules button.

    The Default Depreciation Rules window appears.

  17. In the Price Index field, enter the price index that you want to use to calculate the inflation rate for this asset category.

  18. Enter appropriate information in the remaining fields.

  19. Save your work.

Related Topics

Setting Up Asset Categories, Oracle Assets User Guide

Asset Management in a Highly Inflationary Economy, Oracle Assets User Guide

Using the Account Generator in Oracle Assets, Oracle Assets User Guide

Set Up Assets in a Depreciation Book

Use the globalization flexfield in the Books window to enable or disable inflation adjustment for individual assets. You enable or disable inflation adjustment for an asset in a particular depreciation book.

In this way, you can choose to adjust an asset in one depreciation book while preventing the same asset from being adjusted in another book. You can also choose to adjust some assets in a certain category in a depreciation book for inflation while preventing other assets in the same category and book from being adjusted.

If inflation adjustment is disabled for an entire depreciation book or an entire category in a book, however, none of the assets in that book or category can be adjusted.

You can also use the globalization flexfield to specify how to record depreciation amounts when you enter an asset that has already been adjusted for inflation. To meet Colombian legal requirements, you must record separately these components of the adjusted depreciation for an asset:

If you enter an asset that has already been adjusted for inflation, you can enter the amount of existing depreciation for the asset that corresponds to inflation adjustments to the asset cost. Oracle Assets for Colombia uses this information to separate the total adjusted depreciation amount into the required components and record each component in the appropriate account.

To set up assets in a depreciation book:

  1. Navigate to the Asset Workbench.

  2. Enter or query an asset.

  3. Navigate to the Books window.

  4. Enter a depreciation book in the Book field.

  5. Navigate to the Depreciation region.

  6. Navigate to the globalization flexfield.

  7. Enter Yes in the Adjust for Inflation field to enable inflation adjustment for the asset. Enter No to disable inflation adjustment for the asset.

    If inflation adjustment is enabled for this depreciation book and for this category in this book, the Adjust for Inflation field defaults to Yes. Otherwise, the Adjust for Inflation field defaults to No.

  8. In the Depreciation on Inflation Adjusted Cost field, enter the amount of the existing depreciation for the asset that corresponds to inflation adjustments on the asset cost, if the asset has already been adjusted for inflation.

    If the asset has never been adjusted for inflation, or if you disabled inflation adjustment for the asset, leave the Depreciation on Inflation Adjusted Cost field blank.

    Note: The remaining fields in the globalization flexfield are not used for inflation adjustment. These fields are used for technical appraisal in Oracle Assets for Colombia. For more information, see Enter Initial Values for Technical Appraisals.

  9. Press the OK button.

  10. Save your work.

Related Topics

Asset Setup Processes (Additions), Oracle Assets User Guide

Accounting for Deferred Depreciation Balances

Until 1991, the Colombian government allowed companies to use an accelerated depreciation method in which assets are entirely depreciated over three years for tax purposes. For accounting purposes, however, only the normal depreciation amounts are recognized as expenses during those three years

The difference between the depreciation taken by the accelerated method and the depreciation taken by the normal method is recorded in the deferred depreciation account. After the third year, the balance of the deferred depreciation account must be amortized over the remaining life of the asset.

Since the Colombian government no longer allows companies to use deferred depreciation, you will not need to record any new deferred depreciation amounts. If you have an asset with a deferred depreciation balance from 1991 or earlier, however, you must continue to amortize the balance over the life of the asset. You must also adjust the deferred depreciation balance for inflation and amortize the adjustment amounts along with the original balance.

You can account for deferred depreciation balances in Oracle Assets for Colombia by creating child assets to represent these balances. You should define a special asset category for these child assets.

Setting Up a Deferred Depreciation Asset Category

If you have assets with balances in deferred depreciation accounts, you can create child assets to represent the deferred depreciation balances. You can define a separate asset category for the deferred depreciation child assets. Set the deferred depreciation asset category up to amortize the deferred balance over the life of the parent asset. You should enable inflation adjustment for this asset category as well.

Adding Deferred Depreciation Balances as Child Assets

When you enter a new asset, check whether the asset has any balance in a deferred depreciation account. If the asset you are entering has a deferred depreciation balance, you can create a child asset to represent that balance.

You can use the Asset Workbench to create the child asset representing a deferred depreciation balance. Assign the child asset to the asset category that you defined for deferred depreciation. The child asset can belong to a different asset category than the parent asset. You should enable inflation adjustment for each child asset as well.

To ensure that the balance is amortized correctly, you must assign the child asset that represents a deferred depreciation balance the same depreciation method and remaining life as the parent asset.

Related Topics

Setting Up Asset Categories, Oracle Assets User Guide

Asset Setup Processes (Additions), Oracle Assets User Guide

Accounting for Deferred Monetary Correction Credit Balances

When you adjust the cost amounts of CIP assets for inflation, you charge the deferred monetary correction credit account rather than the regular monetary correction account for capitalized assets. You can define the deferred monetary correction credit account for each asset category in the globalization flexfield in the Asset Categories window.

After you capitalize a CIP asset, the balance of the deferred monetary correction credit account is amortized over the life of the asset using a straight-line method.

You can account for deferred monetary correction credit balances in Oracle Assets for Colombia by creating child assets to represent these balances. You should define a special asset category for these child assets. You can create the child asset for a deferred monetary correction charge balance either when you begin construction on the parent CIP asset or when you capitalize the parent asset.

Setting Up a Deferred Monetary Correction Credit Asset Category

If you have assets with balances in deferred monetary correction credit accounts, you can create child assets to represent the deferred monetary correction credit balances. You can define a separate asset category for the deferred monetary correction credit child assets. Set the deferred monetary correction credit asset category up to amortize the deferred balance over the life of the parent asset.

Adding Deferred Monetary Correction Credit Balances as Child Assets

When you enter a new capitalized asset, or when you capitalize a CIP asset, check whether the asset has any balance in a deferred monetary correction credit account. If the asset you are entering has a deferred monetary correction credit balance, you can create a child asset to represent that balance.

You can use the Asset Workbench to create the child asset representing a deferred monetary correction credit balance. Assign the child asset to the asset category that you defined for deferred monetary correction credit. The child asset can belong to a different asset category than the parent asset.

At the time of capitalization, the cost of the child asset that represents the deferred monetary correction credit balance should equal the difference between the cost of the parent asset in the historical book and in the adjusted book.

Related Topics

Setting Up Asset Categories, Oracle Assets User Guide

Asset Setup Processes (Additions), Oracle Assets User Guide

Accounting for Deferred Monetary Correction Charge Balances

When you use your own company's resources to finance a CIP asset, you must adjust the portion of your own equity that is invested in the CIP asset for inflation. You offset the inflation adjustment by charging the deferred monetary correction charge account.

After you capitalize a CIP asset, the balance of the deferred monetary correction charge account is amortized over the life of the asset using a straight-line method.

You can account for deferred monetary correction charge balances in Oracle Assets for Colombia by creating child assets to represent these balances. You should define a special asset category for these child assets.

Setting Up a Deferred Monetary Correction Charge Asset Category

If you have assets with balances in deferred monetary correction charge accounts, you can create child assets to represent the deferred monetary correction charge balances. You can define a separate asset category for the deferred monetary correction charge child assets. Set the deferred monetary correction charge asset category up to amortize the deferred balance over the life of the parent asset.

For deferred monetary correction charge balances, you can choose to create the child assets as soon as you begin constructing the parent CIP asset. You can then make cost adjustments to the child asset to account for the effect of inflation.

Note: The effect of inflation on deferred monetary correction charge balances is calculated differently than ordinary inflation adjustments. For this reason, you should make manual cost adjustments to a deferred monetary correction charge child asset, rather than using the ordinary inflation adjustment process.

Adding Deferred Monetary Correction Charge Balances as Child Assets

When you enter a new asset, or when you capitalize a CIP asset, check whether the asset has any balance in a deferred monetary correction charge account. If the asset you are entering has a deferred monetary correction charge balance, you can create a child asset to represent that balance.

You can use the Asset Workbench to create the child asset representing a deferred monetary correction charge balance. Assign the child asset to the asset category that you defined for deferred monetary correction charge. The child asset can belong to a different asset category than the parent asset.

You can create the child asset for a deferred monetary correction charge balance either when you begin construction on the parent CIP asset or when you capitalize the parent asset. If you choose to create the child assets as soon as you begin constructing the parent CIP asset, set up the deferred monetary correction charge asset category up with appropriate accounts to record the child assets.

This option allows you to clearly identify the contributions of each CIP asset to the balance of the deferred monetary correction charge account. When you capitalize the parent asset, you can capitalize the child asset as well and begin amortizing the deferred balance as usual.

Related Topics

Setting Up Asset Categories, Oracle Assets User Guide

Asset Setup Processes (Additions), Oracle Assets User Guide

Adjusting Assets for Inflation

Complete these steps in your adjusted depreciation book to adjust your assets for inflation with Oracle Assets for Colombia. You should adjust your assets for inflation regularly once each period. You can perform the Mass Revaluation process to create the inflation adjustments either at the beginning or at the end of the period.

To adjust assets for inflation:

  1. Run the Calculate Gains and Losses program to ensure that accumulated depreciation for reinstated assets is correct.

    Note: Oracle Assets runs the Calculate Gains and Losses program automatically as part of the depreciation process to close a period. If you run the Mass Revaluation process to adjust your assets at the beginning of the period, just after running depreciation to close the previous period, you do not need to run the Calculate Gains and Losses program again separately.

  2. Run the Mass Revaluation process to revalue the cost and accumulated depreciation for your assets. For more information, see Revaluing Assets.

  3. Perform standard Oracle Assets procedures, such as capitalizing CIP assets, at the end of the period. If your country requires assets to be adjusted for inflation in their retirement period, you should also retire assets at this point, after you run the Mass Revaluation process, but before you run depreciation.

  4. Run depreciation in your adjusted book.

  5. Run the Create Accounting program for the Assets application. Leave the Process Category blank to process all entries. For the Post to GL parameter, select Yes for the corporate book and No for a tax book.

  6. Run the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program to create the correct journal entries recording the historical and adjustment amounts in the correct accounts. For more information, see Generating Inflation Adjustment Journal Entries.

  7. Run the Colombian Fixed Assets Transfer to General Ledger process to transfer the journal entries created by Oracle Assets for Colombia to General Ledger. For more information, see Transferring Inflation Adjustment Journal Entries to General Ledger.

  8. Run the Journal Import process to import the journal entries created by Oracle Assets for Colombia into General Ledger. For more information, see Running the Journal Import Process.

  9. Run the Inflation Adjusted Asset Summary report to review the results of the inflation adjustments.

  10. Run standard and Colombian Oracle Assets reports showing inflation adjustment information. For more information, see Reporting Inflation Adjustment Information.

  11. Run the Colombian Fixed Asset Purging process to archive, delete, and recover obsolete information in the inflation adjustment tables. For more information, see Archiving, Purging, and Restoring Inflation Adjustment Data.

    Note: In Colombia, some of the steps for adjusting your assets for inflation are different from the steps for inflation adjustment in other countries. The differences are due to Colombian legal requirements.

    For example, after you adjust your assets for inflation in Oracle Assets for Colombia, you must run the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program to generate the correct journal entries and run the Colombian Fixed Assets Transfer to General Ledger process to transfer these journal entries to General Ledger. Also, since the Colombian government abolished inflation adjustment for gain/loss accounts, you must not use the Oracle Assets Inflation Adjustment of Retired Assets process in Colombia.

Revaluing Assets

Example for adjusting an asset for inflation

This example shows how inflation rates and adjustment amounts are calculated to adjust a capitalized asset for inflation in Colombia. Assume that the price index values for the given periods are as shown in this table:

Period Price Index Value
January 100.00
February 101.00
March 103.02

The inflation rates in this example are calculated with the maximum available precision. The inflation rates are calculated according to this formula:

(Index Value for Current Period/Index Value for Previous Period) - 1

For example, the February Inflation Rate is (101.00 / 100.00) - 1, or 0.01

March Inflation Rate is (103.02 / 101.00) - 1, or 0.02

Assume that an asset is added in January with a cost of $3,600.00 and a life of 2 years, or 24 periods. Assume also that the prorate convention for the asset is the Following Month convention and that there are no cost adjustments after the asset is added, other than the inflation adjustments.

In January, the asset is not adjusted for inflation, since an asset is not adjusted for inflation in the period when the asset is entered. Depreciation is run for the asset in January; however, according to the Following Month prorate convention, the depreciation amount in the first month is 0.

In February, the asset is adjusted for inflation. Since there is no accumulated depreciation for the asset yet, only the asset cost is adjusted. After the asset is adjusted for inflation in February, depreciation is run for the asset.

The inflation adjustment amount for cost in the current period is calculated on the current cost of the asset, including any cost adjustments made in the period before inflation adjustment is performed.

Note: If you want to adjust current period cost adjustment amounts for inflation, make the cost adjustments before you perform inflation adjustment for the current period. Otherwise, make the cost adjustments after you perform inflation adjustment for the current period.

The current cost for the asset is calculated according to this formula:

Beginning Cost + Current Period Cost Adjustments

For example, the February Current Cost is 3,600.00 + 0, or 3,600.00

The current period cost inflation adjustment is calculated according to this formula:

Cost Inflation Adjustment is Current Cost * Inflation Rate

For example, the February Inflation Adjustment is 3,600.00 * 0.01, or 36.00

The total adjusted cost at the end of the period is calculated according to this formula:

Adjusted Cost is Current Cost + Inflation Adjustment

For example, the February Adjusted Cost is 3,600.00 + 36.00, or 3,636.00

Note: For calculation purposes, the total current cost and total adjusted cost of an asset consist of both historical amounts and inflation adjustment amounts, even though you record historical and inflation adjustment amounts in separate accounts.

This table shows the journal entry to record the inflation adjustments in February:

Account Debit Credit
Inflation Adjustment of Cost 36.00  
     Monetary Correction of Cost   36.00

The depreciation amount for the current period is calculated according to this formula:

Current Period Adjusted Cost / Asset Life

For example, the February Depreciation is 3,636.00 / 24, or 151.50

In March, both the cost and the accumulated depreciation of the asset are adjusted for inflation. After the asset is adjusted for inflation in March, depreciation is run for the asset.

The current cost for the asset is calculated according to this formula:

Beginning Cost + Current Period Cost Adjustments

For example, the March Current Cost is 3,636.00 + 0.00, or 3,636.00

The current period cost inflation adjustment is calculated according to this formula:

Current Cost * Inflation Rate

For example, the March Inflation Adjustment is 3,636.00 * 0.02, or 72.72

The total adjusted cost at the end of the period is calculated according to this formula:

Current Cost + Inflation Adjustment

March Adjusted Cost is 3,636.00 + 72.72, or 3,708.72

The inflation adjustment amount for accumulated depreciation in the current period is calculated on the current accumulated depreciation of the asset, before the asset is depreciated for the period.

The current period accumulated depreciation inflation adjustment is calculated according to this formula:

Current Accumulated Depreciation * Inflation Rate

For example, the March Inflation Adjustment is 151.50 * 0.02, or 3.03

This table shows the journal entries to record the inflation adjustments in March:

Account Debit Credit
Inflation Adjustment of Cost 72.72  
     Monetary Correction of Cost   72.72
Monetary Correction of Accumulated Depreciation 3.03  
     Inflation Adjustment of Accumulated Depreciation   3.03

The depreciation amount for the current period is calculated according to this formula:

Current Period Adjusted Cost /Asset Life

For example, the March Depreciation is 3,708.72 /24, or 154.53

The total adjusted accumulated depreciation at the end of the period is calculated according to this formula:

Current Accumulated Depreciation + Inflation Adjustment + Current Period Depreciation

For example, the March Adjusted Accumulated Depreciation is 151.50 + 3.03 + 154.53, or 309.06

Note: For calculation purposes, the total adjusted accumulated depreciation of an asset consists of both historical amounts and inflation adjustment amounts, even though you record historical and inflation adjustment amounts in separate accounts.

Example for adjusting a CIP asset for inflation

This example shows how inflation rates and adjustment amounts are calculated to adjust a CIP asset for inflation in Colombia.

When you build a CIP asset, you add the cost amounts resulting from invoice lines. The invoice line amounts added in the current period are never adjusted for inflation in the current period. The adjustment amount for the current period is calculated only on the asset's adjusted cost as of the beginning of the period.

Assume that the price index values for the given periods are as shown in this table:

Period Price Index Value
January 100.00
February 101.00
March 103.02

The inflation rates in this example are calculated with the maximum available precision. The inflation rates are calculated according to this formula:

(Index Value for Current Period / Index Value for Previous Period) - 1

For example, the February Inflation Rate is (101.00 / 100.00) - 1, or 0.01

March Inflation Rate is (103.02 / 101.00) - 1, or 0.02

Assume that construction began on a CIP asset in December and that the invoice line amounts added each period are as shown in this table:

Period Invoice Line Amount
January 20,000.00
February 18,000.00
March 0.00

The current period cost inflation adjustment is calculated according to this formula:

Beginning Cost * Inflation Rate

The adjusted cost at the end of the period is calculated according to this formula:

Beginning Cost + Inflation Adjustment + Invoice Line Amounts

For example, the January Adjusted Cost is 0 + 0 + 20,000.00, or 20,000.00

February Inflation Adjustment is 20,000.00 * 0.01, or 200.00

February Adjusted Cost is 20,000.00 + 200.00 + 18,000.00, or 38,200.00

This table shows the journal entry to record the inflation adjustment in February:

Accounts Debit Credit
Inflation Adjustment of Cost 200.00  
     Deferred Monetary Correction Credit   200.00

March Inflation Adjustment is 38,200.00 * 0.02, or 764.00

March Adjusted Cost is 38,200.00 + 764.00 + 0.00, or 38,964.00

This table shows the journal entry to record the inflation adjustment in March:

Accounts Debit Credit
Inflation Adjustment of Cost 764.00  
     Deferred Monetary Correction Credit   764.00

Generating Inflation Adjustment Journal Entries

In Colombia, you must record historical amounts and adjustment amounts in separate accounts for the cost and accumulated depreciation components of your assets. The standard Mass Revaluation process, however, creates journal entries that record the adjustment amounts in the same accounts as the historical amounts. To generate the correct journal entries recording the historical amounts and the adjustment amounts in the correct accounts, you must run the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program after you run the Mass Revaluation process.

The Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program also transfers or retires the amounts in inflation adjustment accounts when assets are reclassified, transferred, retired, or reinstated. This process complements the standard transfer of balances for standard Oracle Assets accounts.

You must run the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program after you run depreciation. If you did not run depreciation yet for the current period in your adjusted depreciation book, you cannot run the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program.

The Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program is also used for technical appraisal in Oracle Assets for Colombia. When you run the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program, Oracle Assets for Colombia generates both inflation adjustment and technical appraisal journal entries. You only need to run the process once each period. For more information, see Transferring Technical Appraisal Account Balances.

You can use the globalization flexfield in the Book Controls window to check whether the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program has been run for the latest period. The period name for the most recent time you ran the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program appears in the Last Closed Period field. For more information, see Set Up Depreciation Books.

The Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program prepares inflation adjustment and technical appraisal journal entries for transfer to General Ledger. After you run the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program, run the Colombian Fixed Assets Transfer to General Ledger process to transfer the journal entries created by Oracle Assets to General Ledger.

To the submit the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program, choose Journal Entries > Generate from the Colombian Localization menu. Use the Standard Request Submission windows to submit the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program.

Program Parameters

Book

Enter the depreciation book for which you want to generate Colombian inflation adjustment journal entries. You can only choose a depreciation book for which you have enabled inflation adjustment.

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Transferring Inflation Adjustment Journal Entries to General Ledger

After you run the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program, run the Colombian Fixed Assets Transfer to General Ledger process to transfer the inflation adjustment journal entries created by Oracle Assets to General Ledger.

You must not run the standard Create Journal Entries process from your adjusted depreciation book. The Colombian Fixed Assets Transfer to General Ledger process replaces the standard Create Journal Entries process for the inflation adjustment journal entries. You should, however, run the standard Create Journal Entries process from your historical depreciation book to transfer historical asset information to General Ledger.

The Colombian Fixed Assets Transfer to General Ledger process is also used for technical appraisal in Oracle Assets for Colombia. When you run the Colombian Fixed Assets Transfer to General Ledger process, Oracle Assets for Colombia transfers both inflation adjustment and technical appraisal journal entries. You only need to run the process once each period. For more information, see Transferring Technical Appraisal Journal Entries to General Ledger.

You can use the globalization flexfield in the Book Controls window to check whether the Colombian Fixed Assets Transfer to General Ledger process has been run for the latest period. The period name for the most recent time you ran the Colombian Fixed Assets Transfer to General Ledger process appears in the Last Transferred Period field. For more information, see Set Up Depreciation Books.

The Colombian Fixed Assets Transfer to General Ledger process creates inflation adjustment and technical appraisal journal entries in the General Ledger interface table. Before you can see the journal entries, you must import the journal entries to General Ledger by running the Journal Import process. The Colombian Fixed Assets Transfer to General Ledger process creates the inflation adjustment journal entries with the journal source that you defined for your depreciation book in the Book Controls window and with the journal categories that you defined for your transactions in the globalization flexfield. For more information, see Set Up Depreciation Books.

To submit the Colombian Fixed Assets Transfer to General Ledger process, choose Journal Entries > Transfer to GL from the Colombian Localization menu. Use the Standard Request Submission windows to submit the Colombian Fixed Assets Transfer to General Ledger process.

Program Parameters

Book

Enter the depreciation book that you want to transfer journal entries from. You can only choose a depreciation book for which you have enabled inflation adjustment.

Related Topics

Defining Depreciation Books, Oracle Assets User Guide

Using Standard Request Submission, Oracle Applications User Guide

Running the Journal Import Process

The Colombian Fixed Assets Transfer to General Ledger process creates inflation adjustment journal entries in the General Ledger interface table. Before you can see the journal entries, you must import the journal entries to General Ledger by running the Journal Import process. The inflation adjustment journal entries are imported with the journal source that you defined for the depreciation book in the Book Controls window.

Related Topics

Importing Journals, Oracle General Ledger User Guide

Defining Depreciation Books, Oracle Assets User Guide

Reporting Inflation Adjustment Information

You can run standard Oracle Assets reports to show information about the assets that you adjust for inflation and to meet Colombian reporting requirements. Run the reports from your historical book when you want to show historical information and from your adjusted book when you want to show adjusted information.

This table shows the report to run for these Colombian requirements:

To meet this Colombian requirement… Run this standard Oracle Assets report…
Major Book of Capitalized Assets with Inflation Adjustments Journal Entry Reserve Ledger Report or Tax Reserve Ledger Report
Major Book of CIP Assets with Inflation Adjustments CIP Assets Report
Assets Retired in a Period with Inflation Adjustment Information Asset Retirements Report

You can also use these reports to show information for assets with deferred depreciation balances, deferred monetary correction credit balances, or deferred monetary correction charge balances. To show this information, run the reports for the asset categories that contain the child assets representing deferred balances.

Oracle Assets for Colombia also provides special reports to show inflation adjustment information. For more information, see:

Related Topics

Journal Entry Reserve Ledger Report, Oracle Assets User Guide

Tax Reserve Ledger Report, Oracle Assets User Guide

CIP Assets Report, Oracle Assets User Guide

Asset Retirements Report, Oracle Assets User Guide

Colombian Fixed Assets Inflation Adjusted Drill Down Report

Use the Colombian Fixed Assets Inflation Adjusted Drill Down report to reconcile journal entries to your general ledger and to review activity for your general ledger accounts. The Colombian Fixed Assets Inflation Adjusted Drill Down report lists your journal entry lines and gives detailed information about the asset transactions for a particular journal entry batch.

The Colombian Fixed Assets Inflation Adjusted Drill Down report is sorted by journal entry batch name, journal entry category, account, journal entry line number, and asset number. The report shows the total debits and credits for each line, account number, and batch.

The Colombian Fixed Assets Inflation Adjusted Drill Down report is similar to the standard Oracle Assets Drill Down report, but the Colombian report shows the journal entries created by the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program, which include the Colombian inflation adjustment accounts.

Use the Standard Request Submission windows to submit the Colombian Fixed Assets Inflation Adjusted Drill Down report.

Report Parameters

Book

Enter the depreciation book that you want to report on. You can only choose a tax book for which you have enabled inflation adjustment.

Period

Enter the period that you want to report on.

Batch Name

Enter the name of the batch that is being transferred to General Ledger. Leave this parameter blank to include all batches.

Line

Enter the journal entry line number that you want to report on. Leave this parameter blank to include all journal entry lines.

Report Headings

In this heading… Oracle Assets prints…
<Organization Name> The name of your organization
Book The name of the inflation-adjusted depreciation book
Batch The name of the journal entry batch
Journal Entry Category The journal entry category
<Report Title> Colombian Fixed Assets Inflation Adjusted Drill Down Report
Period The period name
Report Date The date and time that you ran the report
Page The current and total page numbers of the report

Column Headings

In this column... Oracle Assets prints...
Account Number The accounting flexfield
Line The journal entry line number
Asset Number The asset number
Description The asset description
Debits The debit amounts of the transactions
Credits The credit amounts of the transactions
Transaction Number The transaction number of the source transaction

Row Headings

In this row… Oracle Assets prints…
Line <Number> Totals The debit and credit totals for the line
Account Totals The debit and credit totals for the account
Batch Totals The debit and credit totals for the batch
Report Totals The debit and credit totals for the report

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Colombian Fixed Assets Inflation Adjusted Account Drill Down Report

Use the Colombian Fixed Assets Inflation Adjusted Account Drill Down report to reconcile journal entries to your general ledger and to review activity for your general ledger accounts. The Colombian Fixed Assets Inflation Adjusted Account Drill Down report gives you detailed information about the asset transactions represented by a journal entry line.

The Colombian Fixed Assets Inflation Adjusted Account Drill Down report is sorted by account, journal entry batch name, journal entry category, journal entry line number, and asset number. The report shows the total debits and credits for each line, batch, and account number.

The Colombian Fixed Assets Inflation Adjusted Account Drill Down report is similar to the standard Oracle Assets Account Drill Down report, but the Colombian report shows the journal entries created by the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program, which include the Colombian inflation adjustment accounts.

Use the Standard Request Submission windows to submit the Colombian Fixed Assets Inflation Adjusted Account Drill Down report.

Report Parameters

Book

Enter the depreciation book that you want to report on. You can only choose a tax book for which you have enabled inflation adjustment.

Period

Enter the period that you want to report on.

Account

Enter the accounting flexfield that you want to report on. Leave this parameter blank to include all accounts.

Batch

Enter the name of the batch that is being transferred to General Ledger. Leave this parameter blank to include all batches.

Line

Enter the journal entry line number that you want to report on. Leave this parameter blank to include all journal entry lines.

Report Headings

In this heading… Oracle Assets prints…
<Organization Name> The name of your organization
Book The name of the inflation-adjusted depreciation book
Account Number The accounting flexfield
Batch The name of the journal entry batch
Journal Entry Category The journal entry category
<Report Title> Colombian Fixed Assets Inflation Adjusted Account Drill Down Report
Period The period name
Report Date The date and time that you ran the report
Page The current and total page numbers of the report

Column Headings

In this column... Oracle Assets prints...
Line The journal entry line number
Asset Number The asset number
Description The asset description
Debits The debit amounts of the transactions
Credits The credit amounts of the transactions
Transaction Number The transaction number of the source transaction

Row Headings

In this row… Oracle Assets prints…
Line <Number> Totals The debit and credit totals for the line
Batch Totals The debit and credit totals for the batch
Account Number Totals The debit and credit totals for the account
Report Totals The debit and credit totals for the report

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Colombian Inflation Adjusted Fixed Assets Report

Use the Colombian Inflation Adjusted Fixed Assets report to review detailed information about the asset transactions represented by a journal entry line. The Colombian Inflation Adjusted Fixed Assets report shows all the accounts affected by transactions transferred from Oracle Assets for Colombia to General Ledger, including inflation adjustment transactions.

The Colombian Inflation Adjusted Fixed Assets report is sorted by asset category, asset number, and transaction type. The report shows the total debits and credits for each asset as well as totals for all assets on the report.

Use the Standard Request Submission windows to submit the Colombian Inflation Adjusted Fixed Assets report.

Report Parameters

Book

Enter the depreciation book that you want to report on. You can only choose a tax book for which you have enabled inflation adjustment.

Period

Enter the period that you want to report on.

Asset Category

Enter the asset category that you want to report on. You can only choose an asset category that belongs to the depreciation book you entered in the Book parameter.

Leave the Asset Category parameter blank to include all asset categories.

Asset Number

Enter the number of the asset that you want to report on. Leave this parameter blank to include all assets.

Report Headings

In this heading… Oracle Assets prints…
<Organization Name> The name of your organization
Book The name of the tax depreciation book
Asset Category The asset category
<Report Title> Colombia Inflation Adjusted Fixed Assets Report
Period The period name
Report Date The date and time that you ran the report
Page The current and total page numbers of the report

Column Headings

In this column... Oracle Assets prints...
Asset Number - Description The asset number and description
Transaction Type The type of transaction that generated the transfer to General Ledger, identified by the name of the journal category you assigned to this type of transaction in the globalization flexfield of the Book Controls window
Account Number The accounting flexfield
Debit The debit amount of the transaction
Credit The credit amount of the transaction
Transaction Number The transaction number of the source transaction

Row Headings

In this row... Oracle Assets prints...
Asset <Number> Totals The debit and credit totals for the asset
Report Totals The debit and credit totals for all assets on the report

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Archiving, Purging, and Restoring Inflation Adjustment Data

Use the Colombian Fixed Asset Purging process to archive and purge inflation adjustment data in order to release disk space for current data. The Colombian Fixed Asset Purging process purges inflation adjustment data for the book and fiscal year you specify.

If you do not need to run reports for previous fiscal years, you can copy the data onto tape or any storage device, and then delete it from your system. If you later need these records online, you can restore them into Oracle Assets. In Colombia, companies are legally required to store inflation adjustment accounting information for at least twenty years before purging the information.

Archiving inflation adjustment information for a fiscal year and book copies the information for that year and book to an archive table.

Purging inflation adjustment information removes rows from the inflation adjustment table after the rows have been archived. You must purge fiscal years in chronological order. Before you purge a fiscal year, you must archive and purge all earlier fiscal years. You must also archive inflation adjustment information for a fiscal year before purging the information for that fiscal year.

You cannot purge periods in the current fiscal year. You cannot archive and purge the period prior to the current period. If your current period is the first period of a new fiscal year, you cannot purge the previous period.

Restoring inflation adjustment information for a fiscal year and book reloads the information for that fiscal year and book from a storage device into Oracle Assets. You can only restore the most recently purged fiscal year, so you must restore fiscal years in reverse chronological order.

To submit the Colombian Fixed Asset Purging process, choose Purge > Inflation Adjustments from the Colombian Localization menu. Use the Standard Request Submission windows to submit the Colombian Fixed Asset Purging process.

Program Parameters

Book

Enter the depreciation book that you want to process.

Fiscal Year

Enter the fiscal year that you want to process.

Option

Enter the option that you want to perform. Valid values are:

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Performing the Archive, Purge, and Restore Procedure

There are several steps to archive, purge, and restore a fiscal year. Some of these steps you can do within Oracle Assets for Colombia. Others you should ask your Database Administrator to perform.

To archive and purge a fiscal year:

  1. Archive and purge all earlier fiscal years.

  2. Run the Colombian Fixed Asset Purging process with the Archive option (Fixed Assets Administrator).

  3. Export temporary archive tables to a storage device (Database Administrator).

  4. Run the Colombian Fixed Asset Purging process with the Delete option (Fixed Assets Administrator).

  5. Drop temporary archive tables (Database Administrator).

  6. Export current data from tables from which you purged (Database Administrator).

  7. Drop tables from which you purged (Database Administrator).

  8. Recreate tables from which you purged (Database Administrator).

  9. Import current data into tables from which you purged (Database Administrator).

  10. Verify tables and indexes (Database Administrator).

    If you later need the inflation adjustment information online, you can restore the data.

To restore a fiscal year:

  1. Restore all later fiscal years.

  2. Import temporary archive tables from storage device (Database Administrator).

  3. Run the Colombian Fixed Asset Purging process with the Restore option (Fixed Assets Administrator).

Archiving Data

When you run the Archive option, Oracle Assets for Colombia assigns a reference number to the archive. The Colombian Fixed Asset Purging process copies the inflation adjustment data to the temporary table JL_CO_FA_ADJUSTMENTS_<Archive_Number>.

You can export the temporary archive table onto tape or any storage device. If you need these records again, you can restore the records. You must archive records before you can purge them, and Oracle Assets for Colombia prevents you from running the Purge option if this table does not exist. You should not drop the table until after you have exported the table and run the Delete option.

The Colombian Fixed Asset Purging process archives rows from the table JL_CO_FA_ADJUSTMENTS. You can determine approximately how many rows the Colombian Fixed Asset Purging process will archive for a fiscal year using this SQL script:

select count(ADJ.ASSET_ID)
from JL_CO_FA_ADJUSTMENTS ADJ,
FA_DEPRN_PERIODS DP,
FA_FISCAL_YEAR FY
where
FY.FISCAL_YEAR = Fiscal Year To Archive Or Delete and
DP.CALENDAR_PERIOD_OPEN_DATE >= FY.START_DATE and
DP.CALENDAR_PERIOD_CLOSE_DATE <= FY.END_DATE and
ADJ.PEROD_COUNTER_CREATED = DP.PERIOD_COUNTER and
ADJ.BOOK_TYPE_CODE = Depreciation Book To Archive Or Delete From;

Purging Data

Oracle Assets for Colombia prevents you from running the Delete option if the temporary archive table from the archive transaction does not exist. Since the archive number is part of the temporary table name, Oracle Assets for Colombia purges only the records that were archived during the archive you specify.

After you purge your database, contact your Database Administrator to export, drop, and recreate the tables from which you purged data. By recreating these objects, you can reduce the memory each object occupies in your tablespace and perhaps increase the performance of your system.

Restoring Data

To restore records that you have purged from Oracle Assets for Colombia, you must first import the tables from your archive and then perform the restoration. You do not need to archive the records before you purge the records again.

Since the archive number is part of the temporary table name, Oracle Assets for Colombia restores only the records that were archived during the archive you specify.

Controlling Your Archive

Use this table to determine the next possible action you can perform at different stages of the purging procedure.

Status Definition Possible Action
New Newly created archive definition Archive
Archived Archive completed successfully Delete
Purged Purge completed successfully Restore
Restored Restoration completed successfully Delete

Technical Appraisal Overview

In Colombia, corporations must appraise the value of their fixed assets at least once every three years in a process known as a technical appraisal.

During a technical appraisal, an appraiser uses specific accounting procedures to determine the market value of the company's fixed assets. The appraiser gives the appraisal information to the company either on a paper report or electronically on media such as a floppy disk, CD-ROM, and so on.

If the appraiser gives you a paper report, you must manually enter the appraisal information into Oracle Assets. If the appraiser gives you a flat file on a disk, you can import the appraisal information into Oracle Assets if the data is formatted correctly.

After the appraisal information is entered into Oracle Assets, the assets' appraisal value is compared to the assets' net book value, and you record the difference in General Ledger using special technical appraisal accounts.

Basic Business Needs

Oracle Assets lets you satisfy Colombian legal requirements for creating technical appraisals. You can:

Major Features

Journal Entry Category

You can specify a journal entry category at depreciation book level to identify technical appraisal journal entries when the journal entries are created in General Ledger.

Technical Appraisal Accounts

You can define the accounts required to post technical appraisal journal entries in General Ledger. You define technical appraisal accounts at asset category level.

Data Entry

You can enter technical appraisal data into Oracle Assets either manually in the Maintain Technical Appraisals window or automatically with the Colombian Fixed Assets Technical Appraisal Mass Load process.

Accounting

You can use the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program to generate technical appraisal journal entries as well as inflation adjustment journal entries. The Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program creates journal entries for technical appraisal transactions and transfers or retires technical appraisal amounts along with the original amounts when assets are reclassified, transferred, or retired. This process complements the standard transfer of balances for standard Oracle Assets accounts.

Reports for Technical Appraisal

You can use these reports to show technical appraisal information:

Purge Process

You can use the Colombian Fixed Assets Technical Appraisal Purging program to archive, delete, and restore obsolete information in the technical appraisal tables.

Setting Up Technical Appraisal

This section describes how to set up Oracle Assets for Colombia to enable the technical appraisal process. Use this checklist to help you complete the appropriate steps in the correct order.

Step Setup Task
1 Category, Define a Technical Appraisal Journal
2 Assign the Technical Appraisal Journal Category
3 Define Technical Appraisal Accounts
4 Enter Initial Values for Technical Appraisals

Define a Technical Appraisal Journal Category

Define a new journal category in General Ledger for technical appraisal. The journal category helps you identify the nature of technical appraisal journal entries when you post the journal entries in General Ledger. After you define the technical appraisal journal category, you can assign the journal category to your depreciation books.

Related Topics

Defining Journal Categories, Oracle General Ledger User Guide

Assign the Technical Appraisal Journal Category

Use the globalization flexfield in the Book Controls window to assign the journal category used to post technical appraisal transactions. You must assign a technical appraisal journal category to each of your depreciation books.

To assign the technical appraisal journal category:

  1. Navigate to the Book Controls window.

  2. Navigate to the globalization flexfield.

  3. From the list of values in the Technical Appraisal Journal Category field, select the journal category that you want to use for technical appraisals.

  4. Press the OK button.

  5. Save your work.

    Note: The remaining fields in the globalization flexfield are not used for technical appraisal. These fields are used for inflation adjustment in Oracle Assets for Colombia. For more information, see Set Up Depreciation Books.

Related Topics

Defining Depreciation Books, Oracle Assets User Guide

Define Technical Appraisal Accounts

Use the globalization flexfield in the Asset Categories window to define your technical appraisal accounts. You must define these accounts to enable Oracle Assets to register the journal entries in General Ledger:

In the globalization flexfield, enter the natural account that you want to use for each type of technical appraisal account. The Account Generator derives the complete accounting flexfield combinations for your technical appraisal journal entries by following the rules that you set up for the Asset Cost account, but replacing the natural account segment with the natural accounts that you entered for technical appraisal.

To define the new technical appraisal accounts:

  1. Navigate to the Asset Categories window.

  2. Navigate to the globalization flexfield.

  3. In the Technical Appraisal Valuation Account field, enter the natural account where you want to record technical appraisal revaluation amounts.

  4. In the Technical Appraisal Surplus Account field, enter the natural account where you want to record technical appraisal surplus amounts.

  5. In the Technical Appraisal Reserve Account field, enter the natural account where you want to record technical appraisal reserve amounts.

  6. In the Technical Appraisal Reserve Expense Account field, enter the natural account where you want to record technical appraisal reserve expense amounts.

  7. In the Technical Appraisal Reserve Recovery Account field, enter the natural account where you want to record technical appraisal reserve recovery amounts.

  8. Press the OK button.

  9. Save your work.

    Note: The remaining fields in the globalization flexfield are not used for technical appraisal. These fields are used for inflation adjustment in Oracle Assets for Colombia. For more information, see Set Up Asset Categories.

Related Topics

Setting Up Asset Categories, Oracle Assets User Guide

Using the Account Generator in Oracle Assets, Oracle Assets User Guide

Enter Initial Values for Technical Appraisals

If you upgrade Oracle Assets from a previous release or migrate from another asset system, you must enter initial values for technical appraisal information for your assets, including the current revaluation, previous revaluation, last appraisal number, last appraisal date, and last appraisal value.

Use the globalization flexfield in the Books window on the Asset Workbench to enter these initial values. You can enter information in fields that are blank, but you cannot change existing appraisal information. If no initial technical appraisal information is available, leave the technical appraisal fields in the globalization flexfield blank.

The initial values for technical appraisals are defined as follows:

You can also use the globalization flexfield in the Books window to review technical appraisal values for an asset after you enter or import the values.

To define initial balances for technical appraisals:

  1. Navigate to the Asset Workbench.

  2. Query the asset that you want.

  3. Navigate to the Books window.

  4. In the Book field, query the depreciation book that you want.

  5. Navigate to the Depreciation region.

  6. Navigate to the globalization flexfield.

  7. Enter the current revaluation value in the Current Revaluation field.

  8. Enter the previous revaluation value in the Previous Revaluation field.

  9. Enter the number of the last appraisal in the Last Appraisal Number field.

  10. Enter the date of the last appraisal in the Last Appraisal Date field.

  11. Enter the last appraisal value in the Last Appraisal Value field.

  12. Press the OK button.

Note: The remaining fields in the Colombian Books Information flexfield are not used for technical appraisal. These fields are used for inflation adjustment in Oracle Assets for Colombia.

Related Topics

Asset Setup Processes (Additions), Oracle Assets User Guide

Using Colombian Fixed Assets Technical Appraisal Mass Load

Use the Colombian Fixed Assets Technical Appraisal Mass Load process to import technical appraisal information into your Oracle Financials database. Appraisers must submit their appraisal data on a disk, such as a floppy disk or CD-ROM, that contains a flat file in a special format. The Colombian Fixed Assets Technical Appraisal Mass Load process reads the source file data and adds this data to the database.

When the Colombian Fixed Assets Technical Appraisal Mass Load process finishes, Oracle Assets automatically runs the Colombian Fixed Assets Technical Appraisal Validation program. Then Oracle Assets automatically runs the Colombian Fixed Assets Technical Appraisal Additions report. For more information, see Validating Appraisal Information and Colombian Fixed Assets Technical Appraisal Additions Report.

After you import technical appraisal information with the Colombian Fixed Assets Technical Appraisal Mass Load process, you can review the information in the Maintain Technical Appraisals window. For more information, see Entering or Modifying Technical Appraisals.

To submit the Colombian Fixed Assets Technical Appraisal Mass Load process, choose Technical Appraisals > Upload from the Colombian Localization menu. After you submit the Colombian Fixed Assets Technical Appraisal Mass Load process, you must wait until your concurrent request finishes before you can resubmit the process. Use the Standard Request Submission windows to submit the Colombian Fixed Assets Technical Appraisal Mass Load process.

Program Parameters

File Name

Enter the full path and file name of the source data (*.dat) flat file that contains the technical appraisal data that you want to import.

Source Data File and Control File

The source data file contains the technical appraisal data that you upload into your Oracle Financials database. Oracle provides a sample control (*.ctl) file that contains the structure that the source data must use. The pathname for the control file is $JL_TOP/bin/jlcofamp.ctl. When you upload the data file into Oracle Assets, you specify the source data (*.dat) file.

The data file must have the format shown in these tables:

Header Record (First Record)

Field Positions Type Field Length (characters) Description
001-011 Date 11 The appraisal date
012-015 Number 4 The fiscal year
016-030 Char 15 The currency code
031-090 Char 60 The appraiser name
091-150 Char 60 The first line of the appraiser address
151-210 Char 60 The second line of the appraiser address
211-225 Char 15 The appraiser phone number
226-245 Char 20 The appraiser city

Detail Records (Second Record through Last Record)

Field Positions Type Field Length (characters) Description
001-015 Char 15 The asset number
016-035 Number 20 The appraisal value in this format: 99999999999999999.99

You can change the format that your source data uses by customizing the structure of the control file.

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Entering or Modifying Technical Appraisals

To manually enter a new technical appraisal, or to query an existing technical appraisal that you want to modify, use the Maintain Technical Appraisals window. You can modify technical appraisal information only if the appraisal is not yet applied to a book.

An appraisal with a status of Pending is not yet validated, and you can modify the appraisal information if necessary. An appraisal with a status of Processed was already applied to a book, and you cannot change the appraisal information.

To enter appraisal information from an external source, such as a floppy disk or CD-ROM, use the Colombian Fixed Assets Technical Appraisal Mass Load process. For more information, see Using Colombian Fixed Assets Technical Appraisal Mass Load.

You can also use the Maintain Technical Appraisals window to review technical appraisal validation and revaluation information. After you run the Colombian Fixed Assets Technical Appraisal Validation program, you can review appraisal-level and asset-level statuses. After you run the Colombian Fixed Assets Technical Appraisal Revaluation program, you can review the date of the last revaluation for a particular depreciation book. For more information, see Validating Appraisal Information.

To manually enter a new technical appraisal:

  1. Navigate to the Maintain Technical Appraisals window.

  2. Enter the appraisal date in the Appraisal Date field.

  3. Enter the appraiser name in the Appraiser Name field.

  4. In the Fiscal Year field, enter the fiscal year when the appraisal is applied. You can only enter a year that is 1990 or later.

  5. Enter the appraiser's address in the Appraiser Address and City fields.

  6. Enter the currency code for the asset values in the Currency Code field.

  7. Enter the appraiser's telephone number in the Appraiser Phone field.

  8. Navigate to the Asset tabbed region.

  9. Enter the asset number in the Asset Number field.

    Oracle Assets displays the asset description in the Description field.

  10. Enter the appraiser's value for the asset in the Appraised Value field. Enter 0 if the asset has no value. You cannot enter a negative value.

    Oracle Assets automatically assigns the asset appraisal a status of Verified and displays the status in the Status field.

  11. Repeat steps 9 and 10 for each asset in the appraisal that you want to enter.

  12. Save your work.

    Oracle Assets generates the appraisal number and displays the number in the Appraisal Number field at the top of the Maintain Technical Appraisals window.

To modify an existing technical appraisal:

  1. Navigate to the Maintain Technical Appraisals window.

  2. Query the appraisal that you want.

    If the appraisal that you query has a status of Pending, the appraisal is not yet validated and you can modify the appraisal information.

  3. Modify the appraisal information that you want to change. You can modify the information identifying the appraisal, as well as adding, modifying, or removing information for a particular asset within the appraisal.

    Note: After an appraisal is validated or is accounted for in any book, you cannot change the appraisal information.

  4. Save your work.

To review technical appraisal revaluation information:

  1. Navigate to the Maintain Technical Appraisals window.

  2. Query the appraisal that you want.

  3. Navigate to the Book tabbed region.

    In the Book field, Oracle Assets displays the name of the depreciation book in which you have run the Colombian Fixed Assets Technical Appraisal Revaluation program for this appraisal.

    In the Description field, Oracle Assets displays the description of the depreciation book.

    In the Date Revalued field, Oracle Assets displays the date when you ran the Colombian Fixed Assets Technical Appraisal Revaluation program for this appraisal in this depreciation book.

Validating Appraisal Information

Use the Colombian Fixed Assets Technical Appraisal Validation program to validate imported appraisals that have not yet been validated or that have errors, such as an invalid currency or fiscal year. Oracle Assets runs the Colombian Fixed Assets Technical Appraisal Validation program automatically after you run the Colombian Fixed Assets Technical Appraisal Mass Load process. For more information, see Using Colombian Fixed Assets Technical Appraisal Mass Load. You can also submit the Colombian Fixed Assets Technical Appraisal Validation program separately by choosing Technical Appraisals > Validate from the Colombian Localization menu. Use the Standard Request Submission windows to submit the Colombian Fixed Assets Technical Appraisal Validation program.

Program Parameters

Appraisal Number

Enter the number of the appraisal that you want to validate. Leave this parameter blank to validate all pending appraisals.

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Reviewing Appraisal Statuses

After you run the Colombian Fixed Assets Technical Appraisal Validation program, use the Maintain Technical Appraisal window to review the appraisal status. The Maintain Technical Appraisal window displays appraisal statuses at both the appraisal level and asset level.

Appraisal-Level Statuses

Asset-Level Statuses

You must correct appraisals that have a status of Error, Invalid fiscal year, or Invalid currency code. After you correct any errors, run the Colombian Fixed Assets Technical Appraisal Validation program again. Validation is complete when the status of the appraisal is Verified.

Note: If you query an existing appraisal that is not yet validated, the status is Pending at both the appraisal level and asset level.

Accounting for Technical Appraisals

Use the Colombian Fixed Assets Technical Appraisal Revaluation program to compare the asset's current net book value to the appraisal value and record the difference, called the appraisal revaluation, in your technical appraisal accounts. The Colombian Fixed Assets Technical Appraisal Revaluation program calculates the appraisal revaluation and net revaluation for your assets and creates journal entries to record the technical appraisal transactions.

You can use the Maintain Technical Appraisals window to review the date of the last revaluation for a particular depreciation book. For more information, see Entering or Modifying Technical Appraisals.

To submit the Colombian Fixed Assets Technical Appraisal Revaluation program, choose Technical Appraisals > Revalue from the Colombian Localization menu. Use the Standard Request Submission windows to submit the Colombian Fixed Assets Technical Appraisal Revaluation program.

Program Parameters

Book

Enter the depreciation book that you want to use to account for the technical appraisals.

Appraisal Number

Enter the number of the appraisal that you want to process.

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Accounting Logic

When an appraiser assigns an appraisal value to an asset, you must compare the asset's current net book value to the appraisal value and record the difference, called the appraisal revaluation, in your technical appraisal accounts. The appraisal revaluation is calculated based on this formula:

Appraisal Revaluation = Appraisal Value - Inflation-Adjusted Net Book Value

If the appraisal value is greater than or equal to the inflation-adjusted net book value, the asset is revalued. If the appraisal value is less than the inflation-adjusted net book value, the asset is devalued.

The net revaluation for an asset is the difference between the current appraisal revaluation and the previous appraisal revaluation. The net revaluation is calculated based on this formula:

Net Revaluation = Current Appraisal Revaluation - Previous Appraisal Revaluation

Oracle Assets creates journal entries to record the appraisal revaluation for an asset, using the natural accounts that you entered for the asset category that the asset belongs to. The Account Generator derives the complete accounting flexfield combinations for your technical appraisal journal entries by following the rules that you set up for the Asset Cost account, but replacing the natural account segment with the natural accounts that you entered for technical appraisal. For more information, see Define Technical Appraisal Accounts.

Journal Entry Models

The journal entries to record the appraisal revaluation use different accounts depending on whether the current appraisal revaluation, previous appraisal revaluation, and net revaluation amounts are greater or less than zero.

This table shows models for journal entries when the different revaluation amounts are greater or less than zero. The journal entry models use these variables:

Current Appraisal Revaluation (R) Previous Appraisal Revaluation (P) Net Revaluation (N) Account Debit Credit
Greater than or equal to 0 Greater than or equal to 0 Greater than or equal to 0 Technical Appraisal Revaluation N  
Greater than or equal to 0 Greater than or equal to 0 Greater than or equal to 0      Technical Appraisal Surplus   N
Greater than or equal to 0 Greater than or equal to 0 Less than 0 (Np = - N) Technical Appraisal Surplus Np  
Greater than or equal to 0 Greater than or equal to 0 Less than 0 (Np = - N)      Technical Appraisal Revaluation   Np
Greater than or equal to 0 Less than 0 (Pp = - P)   Technical Appraisal Revaluation R  
Greater than or equal to 0 Less than 0 (Pp = - P)        Technical Appraisal Surplus   R
Greater than or equal to 0 Less than 0 (Pp = - P)   Technical Appraisal Reserve    
Greater than or equal to 0 Less than 0 (Pp = - P)        Technical Appraisal Reserve Recovery Pp Pp
Less than 0 (Rp = - R) Greater than or equal to 0   Technical Appraisal Surplus P  
Less than 0 (Rp = - R) Greater than or equal to 0        Technical Appraisal Revaluation   P
Less than 0 (Rp = - R) Greater than or equal to 0   Technical Appraisal Reserve Expense Rp  
Less than 0 (Rp = - R) Greater than or equal to 0        Technical Appraisal Reserve   Rp
Less than 0 (Rp = - R) Less than 0 Greater than or equal to 0 Technical Appraisal Reserve N  
Less than 0 (Rp = - R) Less than 0 Greater than or equal to 0      Technical Appraisal Reserve Recovery   N
Less than 0 (Rp = - R) Less than 0 Less than 0 (Np = - N) Technical Appraisal Reserve Expense Np  
Less than 0 (Rp = - R) Less than 0 Less than 0 (Np = - N)      Technical Appraisal Reserve   Np

Example for technical appraisal

This table shows the journal entries that are created for several different technical appraisals of an asset. Assume that the asset has never been appraised before and that the appraisal value and inflation-adjusted net book value at the time of each appraisal are:

Appraisal Number Appraisal Value Inflation-Adjusted Net Book Value
1 600 420
2 550 430
3 300 390
4 330 350
5 410 350

First appraisal:

The appraisal revaluation for the first appraisal is calculated according to this formula:

Appraisal Value - Inflation-Adjusted Net Book Value

For example 600 - 420, or 180

The net revaluation for the first appraisal is calculated according to this formula:

Current Appraisal Revaluation - Previous Appraisal Revaluation

For example, 180 - 0, or 180

This table shows the journal entry to record the first appraisal:

Account Debit Credit
Technical Appraisal Revaluation 180.00  
     Technical Appraisal Surplus   180.00

Second appraisal:

The appraisal revaluation for the second appraisal is calculated according to this formula:

Appraisal Value - Inflation-Adjusted Net Book Value

For example, 550 - 430, or 120

The net revaluation for the second appraisal is calculated according to this formula:

Current Appraisal Revaluation - Previous Appraisal Revaluation

For example, 120 - 180, or - 60

This table shows the journal entry to record the second appraisal:

Account Debit Credit
Technical Appraisal Surplus 60.00  
     Technical Appraisal Revaluation   60.00

Third appraisal:

The appraisal revaluation for the third appraisal is calculated according to this formula:

Appraisal Value - Inflation-Adjusted Net Book Value

For example, 300 - 390, or - 90

The net revaluation for the third appraisal is calculated according to this formula:

Current Appraisal Revaluation - Previous Appraisal Revaluation

- 90 - 120, or - 210

This table shows the journal entry to record the third appraisal:

Account Debit Credit
Technical Appraisal Surplus 120.00  
     Technical Appraisal Revaluation   120.00
Technical Appraisal Reserve Expense 90.00  
     Technical Appraisal Reserve   90.00

Fourth appraisal:

The appraisal revaluation for the fourth appraisal is calculated according to this formula:

Appraisal Value - Inflation-Adjusted Net Book Value

For example, 330 - 350, or - 20

The net revaluation for the fourth appraisal is calculated according to this formula:

Current Appraisal Revaluation - Previous Appraisal Revaluation

For example, - 20 - (- 90), or 70

This table shows the journal entry to record the fourth appraisal:

Account Debit Credit
Technical Appraisal Reserve 70.00  
     Technical Appraisal Reserve Recovery   70.00

Fifth appraisal:

The appraisal revaluation for the fifth appraisal is calculated according to this formula:

Appraisal Value - Inflation-Adjusted Net Book Value

For example, 410 - 350, or 60

The net revaluation for the fifth appraisal is calculated according to this formula:

Current Appraisal Revaluation - Previous Appraisal Revaluation

For example, 60 - (- 20), or 80

This table shows the journal entry to record the fifth appraisal:

Account Debit Credit
Technical Appraisal Reserve 20.00  
     Technical Appraisal Reserve Recovery   20.00
Technical Appraisal Revaluation 60.00  
     Technical Appraisal Surplus   60.00

Transferring Technical Appraisal Account Balances

Use the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program to transfer or retire technical appraisal account balances when an asset is reclassified, transferred, or retired.

The Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program is also used for inflation adjustment in Oracle Assets for Colombia. When you run the Colombian Fixed Assets Generate Inflation Adjustment Journal Entries program, Oracle Assets for Colombia generates both inflation adjustment and technical appraisal journal entries. You only need to run the process once each period.

For more information, see Generating Inflation Adjustment Journal Entries.

Transferring Technical Appraisal Journal Entries to General Ledger

Use the Colombian Fixed Assets Transfer to General Ledger process to transfer technical appraisal journal entries to General Ledger. You transfer journal entries separately for each depreciation book.

The Colombian Fixed Assets Transfer to General Ledger process is also used for inflation adjustment in Oracle Assets for Colombia. When you run the Colombian Fixed Assets Transfer to General Ledger process, Oracle Assets for Colombia transfers both inflation adjustment and technical appraisal journal entries. You only need to run the process once each period. Ensure that you complete any inflation adjustment and depreciation procedures before you transfer technical appraisal journal entries.

For more information, see Transferring Inflation Adjustment Journal Entries to General Ledger.

Archiving, Purging, and Restoring Technical Appraisals

Use the Colombian Fixed Assets Technical Appraisal Purging program to archive and purge technical appraisal information supplied by appraisers in order to release disk space for current data. The Colombian Fixed Assets Technical Appraisal Purging program purges technical appraisal data for the fiscal year you specify.

If you do not need to access technical appraisal data for previous fiscal years, you can copy the data onto tape or any storage device, and then delete it from your system. If you later need these records online, you can restore them into Oracle Assets.

Archiving technical appraisal information for a fiscal year copies technical appraisal information for that year to an archive table.

Purging technical appraisal information removes rows from technical appraisal tables after the rows have been archived. You can purge technical appraisal transaction information for previous fiscal years as well as for the current year. You must purge fiscal years in chronological order. Before you purge a fiscal year, you must archive and purge all earlier fiscal years. You must also archive technical appraisal information for a fiscal year before purging the information for that fiscal year.

Restoring technical appraisal information for a fiscal year reloads technical appraisal information for that fiscal year from a storage device into Oracle Assets. You can only restore the most recently purged fiscal year, so you must restore fiscal years in reverse chronological order.

To submit the Colombian Fixed Assets Technical Appraisal Purging program, choose Purge > Technical Appraisals from the Colombian Localization menu. Use the Standard Request Submission windows to submit the Colombian Fixed Assets Technical Appraisal Purging program.

Program Parameters

Fiscal Year

Enter the fiscal year that you want to process.

Option

Enter the option that you want to perform.

Delete Unprocessed Appraisals

Enter Yes or No to indicate if you want to delete unprocessed appraisals or not. The default is No.

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Performing the Archive, Purge, and Restore Procedure

There are several steps to archive, purge, and restore a fiscal year. Some of these steps you can do within Oracle Assets for Colombia. Others you should ask your Database Administrator to perform.

To archive and purge a fiscal year:

  1. Archive and purge all earlier fiscal years.

  2. Run the Colombian Fixed Assets Technical Appraisal Purging program with the Archive option (Fixed Assets Administrator).

  3. Export temporary archive tables to a storage device (Database Administrator).

  4. Run the Colombian Fixed Assets Technical Appraisal Purging program with the Delete option (Fixed Assets Administrator).

  5. Drop temporary archive tables (Database Administrator).

  6. Export current data from tables from which you purged (Database Administrator).

  7. Drop tables from which you purged (Database Administrator).

  8. Recreate tables from which you purged (Database Administrator).

  9. Import current data into tables from which you purged (Database Administrator).

  10. Verify tables and indexes (Database Administrator).

    If you later need the inflation adjustment information online, you can restore the data.

To restore a fiscal year:

  1. Restore all later fiscal years.

  2. Import temporary archive tables from storage device (Database Administrator).

  3. Run the Colombian Fixed Assets Technical Appraisal Purging program with the Restore option (Fixed Assets Administrator).

Archiving Data

When you run the Archive option, Oracle Assets for Colombia assigns a reference number to the archive. The Colombian Fixed Assets Technical Appraisal Purging program copies the inflation adjustment data to two temporary tables:

You can export the temporary archive tables onto tape or any storage device. If you need these records again, you can restore the records. You must archive records before you can purge them, and Oracle Assets for Colombia prevents you from running the Purge option if these tables do not exist. You should not drop these tables until after you have exported the tables and run the Delete option.

The Colombian Fixed Assets Technical Appraisal Purging program archives rows from the tables JL_CO_FA_APPRAISALS and JL_CO_FA_ASSET_APPRS. You can determine approximately how many rows the Colombian Fixed Assets Technical Appraisal Purging program will archive for a fiscal year from the table JL_CO_FA_APPRAISALS by using this SQL script:

select count(APPRAISAL_ID)
from JL_CO_FA_APPRAISALS
where
FISCAL_YEAR = Fiscal Year To Archive Or Delete;

You can determine approximately how many rows the Colombian Fixed Assets Technical Appraisal Purging program will archive for a fiscal year from the table JL_CO_FA_ ASSET_APPRS by using this SQL script:

select count(ASS.ASSET_NUMBER)
from JL_CO_FA_ ASSET_APPRS ASS,
JL_CO_FA_APPRAISALS APP
where
APP.FISCAL_YEAR = Fiscal Year To Archive Or Delete and
ASS.APPRAISAL_ID = APP.APPRAISAL_ID;

Purging Data

Oracle Assets for Colombia prevents you from running the Delete option if the temporary archive table from the archive transaction does not exist. Since the archive number is part of the temporary table name, Oracle Assets for Colombia purges only the records that were archived during the archive you specify.

After you purge your database, contact your Database Administrator to export, drop, and recreate the tables from which you purged data. By recreating these objects, you can reduce the memory each object occupies in your tablespace and perhaps increase the performance of your system.

Restoring Data

To restore records that you have purged from Oracle Assets for Colombia, you must first import the tables from your archive and then perform the restoration. You do not need to archive the records before you purge the records again.

Since the archive number is part of the temporary table name, Oracle Assets for Colombia restores only the records that were archived during the archive you specify.

Controlling Your Archive

Use this table to determine the next possible action you can perform at different stages of the purging procedure.

Status Definition Possible Action
New Newly created archive definition Archive
Archived Archive completed successfully Delete
Purged Purge completed successfully Restore
Restored Restoration completed successfully Delete

Colombian Fixed Assets Technical Appraisal Additions Report

Use the Colombian Fixed Assets Technical Appraisal Additions report to verify the technical appraisal data that was added in Oracle Assets.

Oracle Assets runs the Colombian Fixed Assets Technical Appraisal Additions report automatically after you run the Colombian Fixed Assets Technical Appraisal Mass Load process. For more information, see Using Colombian Fixed Assets Technical Appraisal Mass Load.

You can also use the Standard Request Submission windows to submit the Colombian Fixed Assets Technical Appraisal Additions report.

Report Parameters

Appraisal Number

Enter the appraisal identification number.

All Rows

Enter Yes to view all rows of the appraisal. Enter No to view only those rows with an error status. The default for this parameter is Yes.

Report Headings

In this heading... Oracle Assets prints...
<Company Name> The company name
<Report Title> Colombian Fixed Assets Technical Appraisal Additions Report
Report Date The date and time that you ran the report
Page The current and total page numbers of the report
Appraisal Number The appraisal identification number
Appraiser Name The appraiser's name
Appraiser Address The address, phone number, and city of the appraiser
Appraisal Date The date that the appraisal was entered in Oracle Assets
Fiscal Year The fiscal year in which the appraisal is applied
Currency Code The currency code for values used in the appraisal
Appraisal Status The appraisal status
Total Number of Assets for this Appraisal The total number of assets included in the appraisal
<Section Title> Summary of Record Status
Number of Records with Status Asset Number Not Found The number of records with a status of Asset Number Not Found
Number of Records with Status Pending The number of records with a status of Pending
Number of Records with Status Negative Appraised Value The number of records with a status of Negative Appraised Value
Number of Records with Status Verified The number of records with a status of Verified

Column Headings

In this column... Oracle Assets prints...
Asset Number The asset number
Description The asset description
Tag Number The asset tag number
Appraisal Value The asset value calculated by the appraiser
Asset Status The status of the appraisal for this asset

Related Topics

Using Standard Request Submission, Oracle Applications User Guide

Colombian Fixed Assets Technical Appraisal Revaluation Report

Use the Colombian Fixed Assets Technical Appraisal Revaluation report to review the asset revaluation for assets in a particular depreciation book in the current period. The report shows subtotals at the asset category, revaluation account, balancing segment, and depreciation book levels.

Use the Standard Request Submission windows to submit the Colombian Fixed Assets Technical Appraisal Revaluation report.

Report Parameters

Book

Enter the depreciation book that you want to include on the report.

Category

Enter the asset category that you want to include on the report. Leave this parameter blank to include all asset categories.

Report Headings

In this heading... Oracle Assets prints...
<Company Name> The company name
Book The depreciation book
Report Title Colombian Fixed Assets Technical Appraisal Revaluation Report
Report Date The date and time that you ran the report
Page The current and total page numbers of the report
Asset Category The asset category

Column Headings

In this column... Oracle Assets prints...
Asset Number The asset number
Description The asset description
Appraisal Number The identification number of the asset's last technical appraisal
Appraisal Date The date of the asset's last technical appraisal
Appraisal Value The value of the asset's last technical appraisal
Inflation Adjusted Net Book Value The asset's net book value, including inflation adjustments
Appraisal Valuation The asset's valuation originated by the last technical appraisal
Previous Valuation The asset's valuation originated by the technical appraisal prior to the last technical appraisal
Net Valuation The net valuation originated by the last technical appraisal

Row Headings

In this row... Oracle Assets prints...
Asset Category The asset category
Category <Name> Totals The totals for the asset category
Report Totals The totals for the report

Related Topics

Using Standard Request Submission, Oracle Applications User Guide