11g Release 1 (11.1.4)
Part Number E20374-04
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Oracle® Fusion
Accounting Hub Implementation Guide 11g Release 1 (11.1.4) Part Number E20374-04 |
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This chapter contains the following:
Ledgers and Subledgers: Explained
Financial Ledgers: How They Fit Together
Creating Primary Ledgers: Example
Specifying Ledger Options: Worked Example
Assigning Legal Entities and Balancing Segments: Examples
Manage Journal Reversal Criteria Sets
Oracle Fusion Applications reflect the traditional segregation between the general ledger and associated subledgers. Detailed transactional information is captured in the subledgers and periodically imported and posted in summary or detail to the ledger.
A ledger determines the currency, chart of accounts, accounting calendar, ledger processing options, and accounting method for its associated subledgers. Each accounting setup requires a primary ledger and optionally, one or more secondary ledgers and reporting currencies. Reporting currencies are associated with either a primary of secondary ledger.
The number of ledgers and subledgers is unlimited and determined by your business structure and reporting requirements.
If your subsidiaries all share the same ledger with the parent company or they share the same chart of accounts and calendar, and all reside on the same applications instance, you can consolidate financial results in Oracle Fusion General Ledger in a single ledger. Use Oracle Fusion Financial Reporting functionality to produce individual entity reports by balancing segments. General Ledger has three balancing segments that can be combined to provide detailed reporting for each legal entity and then rolled up to provide consolidated financial statements.
Accounting operations using multiple ledgers can include single or multiple applications instances. You need multiple ledgers if one of the following is true:
You have companies that require different account structures to record information about transactions and balances. For example, one company may require a six-segment account, while another needs only a three-segment account structure.
You have companies that use different accounting calendars. For example, although companies may share fiscal year calendars, your retail operations require a weekly calendar, and a monthly calendar is required for your corporate headquarters.
You have companies that require different functional currencies. Consider the business activities and reporting requirements of each company. If you must present financial statements in another country and currency, consider the accounting principles to which you must adhere.
Oracle Fusion Subledgers capture detailed transactional information, such as supplier invoices, customer payments, and asset acquisitions. Oracle Fusion Subledger Accounting is an open and flexible application that defines the accounting rules, generates detailed journal entries for these subledger transactions, and posts these entries to the general ledger with flexible summarization options to provide a clear audit trail.
Companies account for themselves in primary ledgers, and, if necessary, secondary ledgers and reporting currencies. Your transactions from your subledgers are posted to your primary ledgers and possibly, secondary ledgers or reporting currencies. Local and corporate compliance can be achieved through an optional secondary ledger, providing an alternate accounting method, or in some cases, a different chart of accounts. Your subsidiary's primary and secondary ledgers can both be maintained in your local currency, and you can convert your local currency to your parent's ledger currency to report your consolidated financial results using reporting currencies or translation.
A primary ledger is the main record-keeping ledger. Like any other ledger, a primary ledger records transactional balances by using a chart of accounts with a consistent calendar and currency, and accounting rules implemented in an accounting method. The primary ledger is closely associated with the subledger transactions and provides context and accounting for them.
To determine the number of primary ledgers, your enterprise structure analysis must begin with your financial, legal, and management reporting requirements. For example, if your company has separate subsidiaries in several countries worldwide, enable reporting for each country's legal authorities by creating multiple primary ledgers that represent each country with the local currency, chart of accounts, calendar, and accounting method. Use reporting currencies linked to your country specific primary ledgers to report to your parent company from your foreign subsidiaries. Other considerations, such as corporate year end, ownership percentages, and local government regulations and taxation, also affect the number of primary ledgers required.
A secondary ledger is an optional ledger linked to a primary ledger for the purpose of tracking alternative accounting. A secondary ledger can differ from its primary ledger by using a different accounting method, chart of accounts, accounting calendar, currency, or processing options. All or some of the journal entries processed in the primary ledger are transferred to the secondary ledger, based on your configuration options. The transfers are completed based on the conversion level selected. There are four conversion levels:
Balance: Only Oracle Fusion General Ledger balances are transferred to the secondary ledger.
Journal: General Ledger journal posting process transfers the journal entries to the secondary ledger.
Subledger: Oracle Fusion Subledger Accounting creates subledger journals to subledger level secondary ledgers as well as reporting currencies.
Adjustments Only: Incomplete accounting representation that only holds adjustments. The adjustments can be manual or detailed adjustments from Subledger Accounting. This type of ledger must share the same chart of accounts, accounting calendar, and period type combination, and currency as the associated primary ledger.
Note
A full accounting representation of your primary ledger is maintained in any subledger level secondary ledger.
Secondary ledgers provide functional benefits, but produce large volumes of additional journal entry and balance data, resulting in additional performance and memory costs. When adding a secondary ledger, consider your needs for secondary ledgers or reporting currencies, and select the least costly data conversion level that meets your requirements. For secondary ledgers, the least costly level is the adjustment data conversion level because it produces the smallest amount of additional data. The balance data conversion level is also relatively inexpensive, depending upon how often the balances are transferred from the primary to the secondary ledger. The journal and subledger data conversion levels are much more expensive, requiring duplication of most general ledger and subledger journal entries, as well as general ledger balances.
For example, you maintain a secondary ledger for your International Financial Reporting Standards (IFRS) accounting requirements, while your primary ledger uses US Generally Accepted Accounting Principles (GAAP). You decided to select the subledger level for your IFRS secondary ledger. However, since most of the accounting is identical between US GAAP and IFRS, a better solution is to use the adjustment only level for your secondary ledger. The subledger level secondary ledger requires duplication of most subledger journal entries, general ledger journal entries, and general ledger balances. With the adjustment only level, your secondary ledger contains only the adjustment journal entries and balances necessary to convert your US GAAP accounting to the IFRS accounting, which uses a fraction of the resources that are required by full subledger level secondary ledger.
Following are scenarios that may require different combinations of primary and secondary ledgers:
The primary and secondary ledgers use different charts of accounts to meet varying accounting standards or methods. A chart of accounts mapping is required to instruct the application how to propagate balances from the source (primary) chart of accounts to the target (secondary) chart of accounts.
The primary and secondary ledgers use different accounting calendars to comply with separate industry and corporate standards.
Note
Use the same currency for primary and secondary ledgers to avoid difficult reconciliations, if you have the resources to support the extra posting time and data storage. Use reporting currencies or translations to generate the different currency views needed to comply with internal reporting needs and consolidations.
Reporting currencies maintain and report accounting transactions in additional currencies. Each primary and secondary ledger is defined with a ledger currency that is used to record your business transactions and accounting data for that ledger. It is advisable to maintain the ledger in the currency in which the majority of its transactions are denominated. For example, create, record, and close a transaction in the same currency to save processing and reconciliation time. Compliance, such as paying local transaction taxes, is also easier using a local currency. Many countries require that your accounting records be kept in their national currency.
If you need to maintain and report accounting records in different currencies, you do this by defining one or more reporting currencies for the ledger. There are three conversion levels for reporting currencies:
Balance: Only General Ledger balances are converted into the reporting currency using translation.
Journal: General Ledger journal entries are converted to the reporting currency during posting.
Subledger: Subledger Accounting creates subledger reporting currency journals along with primary ledger journals.
Note
A full accounting representation of your primary ledger is maintained in any subledger level reporting currency. Secondary ledgers cannot use subledger level reporting currencies.
Of the three data conversion levels available, the balance data conversion level is typically the least expensive, requiring duplication of only the balance level information. The journal and subledger data conversion levels are more expensive, requiring duplication of most general ledger and subledger journal entries, as well as general ledger balances.
Do not use journal or subledger level reporting currencies if your organization has only an infrequent need to translate your financial statements to your parent company's currency for consolidation purposes. Standard translation functionality meets this need. Consider using journal or subledger level reporting currencies when any of the following conditions exist.
You operate in a country whose unstable currency makes it unsuitable for managing your business. As a consequence, you need to manage your business in a more stable currency while retaining the ability to report in the unstable local currency.
You operate in a country that is part of the European Economic and Monetary Union (EMU), and you choose to account and report in both the European Union currency and your National Currency Unit (NCU).
Note
The second option is rare since most companies have moved beyond the initial conversion to the EMU currency. However, future decisions could add other countries to the EMU, and then, this option would again be used during the conversion stage.
Oracle Fusion Applications is an integrated suite of business applications that connects and automates the entire flow of the business process across both front and back office operations and addresses the needs of a global enterprise. The process of designing the enterprise structure, including the accounting configuration, is the starting point for an implementation. This process often includes determining financial, legal, and management reporting requirements, setting up primary and secondary ledgers, making currency choices, and examining consolidation considerations.
This figure shows the enterprise structure components and their relationships to each other. Primary ledgers are connected to reporting currencies and secondary ledgers to provide complete reporting options. Legal entities are assigned to ledgers, both primary and secondary, and balancing segments are assigned to legal entities. Business units must be connected to both a primary ledger and a default legal entity. Business units can record transactions across legal entities.
A primary ledger is the main record-keeping ledger. Create a primary ledger by combining a chart of accounts, accounting calendar, ledger currency, and accounting method. To determine the number of primary ledgers, your enterprise structure analysis must begin with determining financial, legal, and management reporting requirements. For example, if your company has separate subsidiaries in several countries worldwide, create multiple primary ledgers representing each country with the local currency, chart of accounts, calendar, and accounting method to enable reporting to each country's legal authorities.
If your company just has sales in different countries, with all results being managed by the corporate headquarters, create one primary ledger with multiple balancing segment values to represent each legal entity. Use secondary ledgers or reporting currencies to meet your local reporting requirements, as needed. Limiting the number of primary ledgers simplifies reporting because consolidation is not required. Other consideration such as corporate year end, ownership considerations, and local government regulations, also affect the number of primary ledgers required.
A secondary ledger is an optional ledger linked to a primary ledger. A secondary ledger can differ from its related primary ledger in chart of accounts, accounting calendar, currency, accounting method, or ledger processing options. Reporting requirements, for example, that require a different accounting representation to comply with international or country-specific regulations, create the need for a secondary ledger.
Below are scenarios and required action for different components in primary and secondary ledgers:
If the primary and secondary ledgers use different charts of accounts, the chart of accounts mapping is required to instruct the system how to propagate journals from the source chart of accounts to the target chart of accounts.
If the primary and secondary ledgers use different accounting calendars, the accounting date and the general ledger date mapping table will be used to determine the corresponding non-adjusting period in the secondary ledger. The date mapping table also provides the correlation between dates and non-adjusting periods for each accounting calendar.
If the primary ledger and secondary ledger use different ledger currencies, currency conversion rules are required to instruct the system on how to convert the transactions, journals, or balances from the source representation to the secondary ledger.
Note: Journal conversion rules, based on the journal source and category, are required to provide instructions on how to propagate journals and types of journals from the source ledger to the secondary ledger.
Reporting currencies are the currency you use for financial, legal, and management reporting. If your reporting currency is not the same as your ledger currency, you can use the foreign currency translation process or reporting currencies functionality to convert your ledger account balances in your reporting currency. Currency conversion rules are required to instruct the system on how to convert the transactions, journals, or balances from the source representation to the reporting currency.
Legal entities are discrete business units characterized by the legal environment in which they operate. The legal environment dictates how the legal entity should perform its financial, legal, and management reporting. Legal entities generally have the right to own property and the obligation to comply with labor laws for their country. They also have the responsibility to account for themselves and present financial statements and reports to company regulators, taxation authorities, and other stakeholders according to rules specified in the relevant legislation and applicable accounting standards. During setup, legal entities are assigned to the accounting configuration, which includes all ledgers, primary and secondary.
You assign primary balancing segment values to all legal entities before assigning values to the ledger. Then, assign specific primary balancing segment values to the primary and secondary ledgers to represent nonlegal entity related transactions such as adjustments. You can assign any primary balancing segment value that has not already been assigned to a legal entity. You are allowed to assign the same primary balancing segment values to more than one ledger. The assignment of primary balancing segment values to legal entities and ledgers is performed within the context of a single accounting setup. The Balancing Segment Value Assignments report is available to show all primary balancing segment values assigned to legal entities and ledgers across accounting setups to ensure the completeness and accuracy of their assignments. This report allows you to quickly identify these errors and view any unassigned values.
A business unit is a unit of an enterprise that performs one or many business functions that can be rolled up in a management hierarchy. When a business function produces financial transactions, a business unit must be assigned a primary ledger, and a default legal entity. Each business unit can post transactions to a single primary ledger, but it can process transactions for many legal entities. Normally, it will have a manager, strategic objectives, a level of autonomy, and responsibility for its profit and loss. You define business units as separate task generally done after the accounting setups steps.
The business unit model:
Allows for flexible implementation
Provides a consistent entity for controlling and reporting on transactions
Enables sharing of sets of reference data across applications
For example, if your company requires business unit managers to be responsible for managing all aspects of their part of the business, then consider using two balancing segments, company and business unit to enable the production of business unit level balance sheets and income statements.
Transactions are exclusive to business units. In other words, you can use business unit as a securing mechanism for transactions. For example, if you have an export business that you run differently from your domestic business, use business units to secure members of the export business from seeing the transactions of the domestic business.
Create a primary ledger as your main record-keeping ledger. Like any other ledger, a primary ledger records transactional balances by using a chart of accounts with a calendar, currency, and accounting rules implemented in an accounting method. The primary ledger is closely associated with the subledger transactions and provides context and accounting for them.
Your company, InFusion Corporation is implementing Oracle Fusion Applications. You have been assigned the task of creating a primary ledger for your InFusion America entity.
Navigate to the Define Accounting Configurations task list and open Manage Primary Ledgers from within your implementation project. Click the Go to Task.
Click the Create icon.
Enter the following values:
|
Field |
Value |
|---|---|
|
Name |
InFusion America |
|
Description |
InFusion America primary ledger for recording transactions. |
|
Chart of Accounts |
InFusion America Chart of Accounts |
|
Accounting Calendar |
Standard Monthly |
|
Currency |
USD |
|
Accounting Method |
Standard Accrual |
Click Save and Edit Task List to navigate back to the accounting configuration task list.
Note
You cannot change the chart of accounts, accounting calendar, or currency for your ledger after you save your ledger.
This example demonstrates specifying the ledger options for your primary ledger. Your company, InFusion Corporation, is a multinational conglomerate that operates in the United States (US) and the United Kingdom (UK). InFusion has purchased an Oracle Fusion enterprise resource planning (ERP) solution including Oracle Fusion General Ledger and all of the Oracle Fusion subledgers.
After completing your InFusion America Primary Ledger, select Specify Ledger Options under the Define Accounting Configuration task list on the Functional Setup Manager page.
Note
Both primary and secondary ledgers are created in the same way and use the same user interface to enable their specific ledger options.
Important: Select a period after the first defined period in the ledger calendar to enable running translation. You cannot run translation in the first defined period of a ledger calendar. In this example, your calendar began with Jan-2010.
Any value between 0 and 999 periods can be specified to permit entering journals but not posting them in future periods. Minimize the number of open and future periods to prevent entry in the wrong period.
This account is required for the General Ledger to perform the movement of revenue and expense account balances to this account at the end of the accounting year.
Note: The Cumulative Translation Adjustment (CTA) account is required for ledgers running translation.
The values entered here are used as the default for balance level reporting currency processing. InFusion America Primary Ledger is using the subledger level reporting currency processing.
|
Option |
Setting |
|---|---|
|
Enable Suspense |
General Ledger |
|
Default Expense Account |
101-00-98199999-0000-000-0000-0000 |
|
Rounding Account |
101-10-98189999-0000-000-0000-0000 |
|
Entered Currency Balancing Account |
101-10-98179999-0000-000-0000-0000 |
|
Balancing Threshold Percent |
10 |
|
Option |
Description |
|---|---|
|
Enable journal approval |
Click to enable journal approval functionality. Approval rules must be created in the Oracle Fusion Approvals Management (AMX). |
|
Notify when prior period journal |
Notify the user when a prior period date is selected on a journal entry. |
|
Allow mixed and statistical journals |
Enter both monetary and statistical amounts on the same line in a journal entry. |
|
Validate reference date |
Requires a reference date in an open or future enterable period. |
Note: To complete the intercompany accounting functionality, you must define intercompany rules.
To avoid data corruption, your cumulative adjustment account (CTA) can only be changed if you first perform the following set of steps:
Purge all translated balances
Change the CTA account
Rerun translation
To avoid data corruption, your retained earnings account can only be changed if you first perform the following set of steps:
Enter and post journals to bring the ending balances for your income statement accounts to zero at the end of each accounting year
Purge actual translated balances
Update the retained earnings account
Reverse the journal entries use to bring the ending account balances to zero and rerun translation
Optionally, assign legal entities and balancing segments to your accounting configuration.
Assign one or more legal entities to your configuration by following these steps:
Navigate to the Assign Legal Entities task. Click the Go to Task.
Click the Select and Add icon.
Click Search. Select your legal entities.
Click Apply. Click Done.
Click Save and Close.
Assign balancing segment values to your legal entities by following these steps:
Navigate to the Assign Balancing Segment Values to Legal Entities task. Click the Go to Task.
Click the Create icon.
Select the balancing segment value. Optionally, add a Start Date.
Click Save and Close to close the create page.
Click Save and Close.
Assign balancing segment values directly to your ledger by following these steps:
Navigate to the Assign Balancing Segment Value to Ledger task. Click the Go to Task.
Select the balancing segment value.
Optionally enter a start date.
Click Save and Close.
Note
The balancing segment values that are assigned to the ledger represent nonlegal entity transactions, such as adjustments. If you use legal entities, you must assign balancing segment values to all legal entities before assigning values to the ledger. The only available balancing segment values that can be assigned to ledgers are those not assigned to legal entities.
Reporting currency balances, set at the journal or subledger level, are updated when journal entries that originate in Oracle Fusion General Ledger are posted and converted to your reporting currencies. This process includes General Ledger manual journals, periodic journals, and allocations, and at the subledger level, journals from Oracle Fusion Subledger Accounting and imported from sources other than your Oracle Fusion subledgers. When you post a journal in a ledger that has one or more reporting currencies defined, the posting process creates new journals converted to each of your reporting currencies and includes them in the same batch as the original journal with a status of Posted.
Reporting currencies share a majority of the ledger options with their source ledger. For example, the reporting currency uses the same suspense account and retained earnings accounts as its source ledger. However, there are certain options that need to be set specifically for the reporting currencies. For example, reporting currencies are maintained at one of these three currency conversion levels:
Balance Level: Only balances are maintained in the reporting currency using the General Ledger Translation process.
Journal Level: Journal entries and balances are converted to the reporting currency by the General Ledger Posting process.
Subledger Level: Subledger Accounting creates reporting currency journals for subledger transactions. General Ledger converts journals that originated in General Ledger or that are imported from sources other than the Oracle Fusion subledgers. The full accounting representation of your primary ledger is maintained in the subledger level reporting currency.
Note
Secondary Ledgers cannot use subledger level reporting currencies.
There are multiple dependencies between a reporting currency and its source ledger. Therefore, it is important that you complete your period opening tasks, daily journal or subledger level reporting currencies accounting tasks, and period closing tasks in the correct order. Some guidelines are presented in the table below.
|
Type |
Task |
|---|---|
|
Period Opening Tasks |
Open the accounting period in both your ledger and reporting currencies before you create or import journals for the period. Converted journals are only generated in your reporting currency if the period is open or future enterable. |
|
Daily Tasks |
Enter the daily conversion rates to convert your journals to each of your reporting currencies. |
|
Period Closing Tasks |
|
If you use reporting currencies at the journal or subledger level, when you create accounting, post journal entries, or translate balances, journals are posted in your reporting currency. General Ledger and Subledger Accounting automatically generate journals in your reporting currencies where the entered currency amounts are converted to the reporting currency amounts. Other factors used in the calculation of reporting currency balances are listed:
Manual Journals: Enter a manual journal batch in your reporting currency at the journal or subledger level by using the Create Journals page. Select the journal or subledger level reporting currency from the ledger's list of values and continue in the same manner as entering any other manual journal.
Conversion Rounding: Use the reporting currency functionality to round converted and accounted amounts using the same rounding rules used throughout your Oracle Fusion Applications. The reporting currency functionality considers several factors that are a part of the currencies predefined in your applications, including:
Currency Precision: Number of digits to the right of the decimal point used in currency transactions.
Minimum Accountable Unit: Smallest denomination used in the currency. This might not correspond to the precision.
Converted Journals: Generate and post automatically, using the General Ledger Posting process, journals in your reporting currencies when you post the original journals in the source ledger for the following types of journals:
Manual journals
Periodic and allocation journals
Unposted journals from non-Oracle subledger applications
Unposted journals from any Oracle Fusion subledger that does not support reporting currency transfer and import
Optionally, revaluation journals
Unconverted Journals: Rely on the subledger accounting functionality to converted and transfer Oracle Fusion subledger journals for both the original journal and the reporting currency journal to the General Ledger for import and posting. The reporting currency conversion for these journals is not performed by the General Ledger.
Approving Journals: Use the journal approval feature to process reporting currency journals through your organization's approval hierarchy. You can enable journal approval functionality separately in your source ledger and reporting currencies.
Document Numbers: Accept the default document numbers assigned by the General Ledger application to your journal when you enter a journal in your ledger. The converted journal in the reporting currency is assigned the same document number. However, if you enter a journal in the reporting currency, the document number assigned to the journal is determined by the reporting currency.
Sequential Numbering: Enable sequential numbering if you want to maintain the same numbering in your reporting currency and source ledger for journals, other than those journals for Oracle Fusion subledgers. Do not create separate sequences for your reporting currencies. If you do, the sequence defined for the reporting currencies is used and can cause document numbers not to be synchronized between the ledger and reporting currencies.
Note
If the Sequential Numbering profile option is set to Always Used or Partially Used and you define an automatic document numbering sequence, General Ledger enters a document number automatically when you save your journal. If you use manual numbering, you can enter a unique document number.
Revaluation: Run periodically revaluation in your ledger and reporting currencies as necessary to satisfy the accounting regulations of the country in which your organization operates.
Account Inquiries: Perform inquires in the reporting currency. Drill down to the journal detail that comprises the reporting currency balance. If the journal detail is a converted journal that was converted automatically when the original journal was posted in the source ledger, you can drill down further to see the source ledger currency journal amounts.
Note
Be careful when changing amounts in a reporting currency, since the changes are not reflected in your source ledger. Making journal entry changes to a reporting currency makes it more difficult to reconcile your reporting currency to your source ledger. In general, enter or change your journals in your source ledger, and then allow posting to update the reporting currency.
Note
If you use reporting currencies at the journal or subledger level, statistical journals are generated for your reporting currencies, but the journals are not affected by the currency conversion process.
Journal approval in Oracle Fusion applications uses Oracle Fusion Approvals Management (AMX) to merge the functionality of Oracle Approvals Management (AME) and PeopleSoft Approvals (AWE). In addition, Oracle Business Process Execution Language (BPEL) has replaced Oracle Workflow.
There is one predefined approval rule. If you enable the ledger and the source for approval, then the journal entry is sent for one level of approval by default. You must configure the approval rules in the AMX Rules Setup user interface. For a simple approval scenario, start by defining one or all of the following rules.
Journal approval based on the highest journal line amount per ledger per batch.
Journal approval based on the highest journal amount per ledger per batch.
Journal approval behavior based on where you are in the period close process. For example, are you in the beginning, middle, or end of the month, or in pre-close, close, post close, or quarter close process?
For example, after your ledger is enabled for approval, enter the following approval rules to apply when your maximum journal line amount is:
Less than 50,000 United States dollars (USD), then there is no approval required
Between 50,000 to 100,000 USD, then the journal batch requires one level of approval
Greater than 100,000 USD, then the journal batch requires two levels of approval
Build your rules for every combination of ledger, entered amount, approval level, or other needed scenarios by using the pattern in the suggested rules. In addition, the Oracle Fusion functionality allows you to further define your own rules based on attributes from the different parts of your journal, including the ledger, batch, header, or line level. For example, use category, source, account, or descriptive flexfield information as selection criteria for the journals to be sent for approval.
The ledger is included in the rules because you typically define approval rules per ledger. Set the options that enable journal approval at the ledger level and by journal source. This allows the approval process to determine which journals to send for approval.
Use the following AMX List Builder to build your approval list.
|
List Builder |
Functionality |
Additional Information |
|---|---|---|
|
Human Resources (HR) Supervisory |
This method uses the HR Supervisory hierarchy levels and specifies the number of levels available for approval. |
This method is most effective when the General Accountant enters the journals. For example, if an accountant enters a journal, he needs approval from his manager. If his manager enters a journal he needs approval from his manager and so on up the hierarchy for the specified number of levels. Self approval can be set at any levels in the hierarchy. |
|
Job Level |
A relative dollar amount can be attached to a job. The approval list moves up the HR Supervisory hierarchy to the point it finds a job with the necessary approval amount. |
Enable self-approval to allow approval of journals created within your authority limit. |
|
Position |
A relative dollar amount can be attached to a position. |
This is effective if you need a hierarchy different than the HR Supervisory hierarchy. It is also effective when there are multiple hierarchies that need to be selected based on different attributes. |
|
Approval Group |
Approver groups represent functional or subject matter experts outside the transaction's managerial chain of authority, such as Legal or HR personnel. |
|
|
Dual Chain |
Dual chains can be processed at the same time. |
|
Note
Best practices are to select Job Level, HR Supervisory, or Position list builders for your journal approval rules.
Other functionality to consider before defining approval rules include:
Approval is for the entire journal batch regardless of the attributes used in the approval rules.
For the job and position level approvals, the approval list continues up hierarchy until it finds the approver with the correct approval authority.
If the journal requires approval, submitting a journal for posting automatically routes the journal for approval before posting.
A journal can be escalated to a new approver by the administrator.
The Withdraw Approval button on the Journals page is used at anytime in the approval process to withdraw journals from the process. Clicking this button allows you to edit to the journal. After your changes are made, submit the entry for approval again. When a journal is withdrawn, the completion status is set to Incomplete.
Approval notifications display a table of key journal attributes for each journal and a list of past, current, and future approvers.
The Journals region of the dashboard displays the journals requiring your approval (if you have the privilege to approve journals) and journals with pending approval from others.
The Journals page allows you to approve or reject journals if you are the current approver.
Allocation journals are not routed through the approval process.
Note
Approval is enabled at the ledger and source level. Both the ledger and journal source need to be enabled for the approval process.
This example shows how to create an AutoPost Criteria Set to post your general ledger journal entries that were created by the journal import process for your subledger transactions. Your enterprise, InFusion Corporation, implemented Oracle Fusion General Ledger and the following Oracle Fusion subledgers: Payables and Receivables. You use a non-Oracle subledger called Fast Assets for fixed asset tracking and depreciation. You want to automate posting of your general ledger journal batches created by the journal import process to protect the subledger sourced journal entries from edits or deletion that might inadvertently happen and cause an out-of-balance situation between your subledgers and general ledger.
Consider the following points while creating your criteria set:
Use the All option for category and accounting period to reduce maintenance and ensure that all journal imports are included in the posting process.
Create a criteria set that includes all your subledger sources. Create multiple criteria sets by source only if you need to schedule different posting times to balance close activities or reduce processing time.
Create your AutoPost Criteria Set to automatically post journal entries from both Oracle and non-Oracle subledgers.
|
Priority |
Ledger or Ledger Set |
Source |
Category |
Accounting Period |
|---|---|---|---|---|
|
1 |
InFusion Corporation Ledger |
Payables |
All |
All |
|
2 |
InFusion Corporation Ledger |
Receivables |
All |
All |
|
3 |
InFusion Corporation Ledger |
Fast Assets |
All |
All |
Setting the before and after days with a wide range of days enables the process to run less often.
Schedule the process immediately after the journal imports to prevent changes to the journals. Run the process during nonpeak times to save resources.
Create an AutoPost criteria set and schedule the AutoPost process to run on a regular basis following your scheduled journal imports from your subledgers. When errors occur that prevent posting of the journal imports, you must correct the errors and manually run the AutoPost process. The following scenarios illustrate the kinds of errors that could occur and how you can resolve these errors.
The following errors occurred and prevented the journal batches from posting when the scheduled AutoPost process ran.
|
Error |
Cause |
Solution |
|---|---|---|
|
Error - Unopened accounting period |
The journal import was imported into a future period. An error arises when the AutoPost process runs on a schedule because journals cannot be posted in a future period. |
Open the period. |
|
Error - Invalid or no journals |
Journal import fails to import transactions from the general ledger interface table. The AutoPost process runs on schedule but finds no batches to post. The Posting process does not run and the AutoPost Execution report shows that no batches matched the criteria. |
Correct the error that caused the journal import to fail. |
|
Error - Invalid or no journals |
No journals were selected based on the posting criteria. Journal batches are available for posting. The Posting process does not run and the AutoPost Execution report shows that no batches matched the criteria. |
Revise the criteria set. |
After you correct the errors, manually run the AutoPost process by selecting the Launch AutoPost option from the Tasks panel on the journal pages or by clicking the Generate button on the AutoPost criteria set pages. Verify that the process ran successfully by reviewing the AutoPost Execution report.
After you define an automatic posting criteria set, run the AutoPost process by clicking the Generate button on the Manage AutoPost Criteria Sets page or the Launch AutoPost link from the Journals task pane. The AutoPost process posts the journal batches that meet the criteria defined. Optionally, schedule the AutoPost process for specific automatic posting criteria sets through the Enterprise Scheduler to run at specific times and submission intervals.
Review the AutoPost process results on the AutoPost Execution report. This report is automatically created when the process completes successfully. The report contains the batch name, accounting period, and balance type for each posted journal batch, and lists error statuses for batches that failed to post. The unposted journals with their error status are also displayed on the Requiring Attention tab of the Journals work area and the General Accounting Dashboard.
Verify that the posting criteria set specifies the precise criteria needed to post the desired journals. If the criteria is correct, then verify the following:
Journal imports completed successfully.
Journal batches are error free and ready to post.
Desired accounting period is open.
The ability to submit journal reversals automatically allows you to automate and streamline your journal reversal process. If you routinely generate and post a large number of journal reversals as part of your month end closing and opening procedures, using the automatic reversal functionality saves you time and reduces entry errors.
The journal must meet the following criteria to be automatically reversed:
Balance type is Actual.
Category is enabled to be automatically reversed.
Reversal period is open or future enterable.
Posted but not yet reversed.
Not a reversal journal. Reversal journals cannot be reversed in Oracle Fusion General Ledger.
Not a posted journal for a reporting currency that was replicated from its source journal. Reporting currency journals that were replicated from a source journal will be reversed when the source journal is reversed.
Not a posted journal that originated from Oracle Fusion Subledger Accounting with a frozen source.
There is a new ledger option called Launch AutoReverse After Open Period that you can enable to have journal reversals automatically generated when an accounting period is first opened for the ledger. This ledger option replaces the former profile option called GL: Launch AutoReverse After Open Period. If you prefer to reverse your journals on the last day of every month, disable the ledger option to automatically launch reversals when the period is opened. Then schedule the AutoReverse process to run on the last day of every month.
Define Journal Reversal Criteria Sets to automatically reverse and optionally post journals using the following criteria:
|
Criteria |
Functionality |
Options |
|---|---|---|
|
Category |
Required. The journal category you set as the reversal option. Journals entered with this category are chosen for reversal and optionally, posting. |
All journal categories are listed. |
|
Reversal period |
Required. The accounting period of the reversal journal. The Next day option is only applicable to average daily balance ledgers. Nonaverage daily balance ledgers and consolidation average daily balance ledgers treat the Next day option in the same manner as the No default option. |
|
|
Reversal day |
Required for average daily balance ledgers only. The day of the period on which to reverse the journal. |
|
|
Reversal method |
Required. The method for changing the amounts in the reversal entry. |
|
|
Automatic reversal option |
Required. The option to reverse and post journals automatically. Journals are posted after they are reversed. |
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After creating your journal reversal criteria sets, assign them to ledgers. Journal reversal criteria set can be shared and assigned to multiple ledgers. Also secure journal reversal criteria set definitions using definition access set security to prevent unauthorized users from using, viewing, or modifying the journal reversal criteria.
If the automatic reversal option is set to reverse and post automatically, the AutoPost process posts all the reversal journals that were generated by the AutoReverse process. The process does not pick up other journals. You manually post reversal journals that were generated outside of the AutoReverse process.
Note
Journals posted by the AutoReverse process always bypass approval.
General Ledger automatically creates the AutoReverse Execution report when the AutoReverse process completes successfully. The report prints the journal name and reversal period for each journal that is successfully reversed and whether the reversal journal is submitted for posting. The AutoPost Execution report is created automatically when the AutoPost process finishes. These reports help you diagnose any problems and verify that all journals were processed properly.
Note
The AutoReverse process does not check that the reversal date is a valid business day for an average balance ledger. The journal validation in the journal pages or import process does the check and if necessary, rolls the date to the next business day.
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