Multiperiod Accounting Distribution Creation Using Transaction Account Definition

Use the Transaction Account Definition to automatically derive and assign the multiperiod accrual account to Payables invoices created through the various channels (electronic, IDR, supplier portal). The Transaction Account Definition uses account rules created in Subledger Accounting to default the multiperiod accrual account to invoices. This eliminates the manual account code entry during invoice creation and the account coding workflow process, and provides a review of distributions during the approval workflow."

When invoices are created through the Payables Invoice Import process or when invoices are validated either online or through the Validate Payables Invoice process, transaction account definition (TAD) automatically derives the multiperiod accrual account combination, along with other expense account combinations, for invoice lines that are applicable for multiperiod accounting. Alternatively, manually select the required invoice lines and initiate the account derivation from the Create Invoice page.

The standard multiperiod accounting system has an inherent check on invoice lines to ensure that the user provides all three multiperiod accounting attributes (start date, end date, and multiperiod accrual account) or none. An error message is displayed to the user if partial values are entered. This check ensures the required data is available on the invoice to generate multiperiod accrual accounting. However, this check does restrict the use of TAD to default multiperiod accrual accounts, as it always forces the user to enter the multiperiod accrual account even before TAD can be invoked. The multiperiod accrual accounting standard behavior is modified as explained below to allow users to leverage TAD to default multiperiod accrual accounts. These changes are applicable only when the TAD is enabled.

Invoice Import Process:

  1. For invoice lines related to multiperiod accrual accounting, the user needs to provide only the date fields, which are the start date and end date, and leave the multiperiod accrual account blank for TAD to default it. However, if TAD cannot derive the accrual account, the invoice is rejected.

Create Invoice page:

  1. For invoice lines that are related to multiperiod accrual accounting, the user must enter only the date fields, which are the start date and end date. An error is displayed if user enters only one date of the two dates. Users can either enter the MPA accrual account manually or leave it blank for TAD to default it.
  1. Distributions are not generated for invoice lines that have multiperiod accounting dates but not the multiperiod accrual account.

Invoice Validation process:

  1. During invoice validation, TAD is invoked to default the multiperiod accrual account for all invoice lines that have multiperiod date information but not the multiperiod accrual account. Such invoice lines are placed on a “Multiperiod Accrual Account Required” hold if the multiperiod accrual account cannot be defaulted through TAD.
  1. The “Multiperiod Accrual Account Required” hold is automatically released when the multiperiod accrual account is populated on the invoice line, either manually by the user or automatically by the TAD.
  1. From the manage holds page, the user can review the errors, if any, raised by the sub-ledger accounting module during TAD-based account derivation.

Business Benefits:

  • Increased productivity by saving effort spent on manual derivation of multiperiod accrual account combinations.
  • Reduced errors from automating several steps in deriving the account combination.

Steps to Enable

Use the Opt In UI to enable this feature. For instructions, refer to the Optional Uptake of New Features section of this document.

Offering: Financials  No Longer Optional From: Update 25A

After enabling the opt-in, follow these steps to create account rules and enable TAD.

  1. Create the necessary account rules in the Subledger Accounting module and assign them to a Transaction Account Definition. See Configuring Subledger Accounting for TAD in Oracle Help Center.
  1. Assign the Transaction Account Definition to the ledger.
  1. Enable Transaction Account Definition-based account derivation in the Manage Invoice options setup for Payables.

Tips And Considerations

  • Transaction Account Definition does not support the derivation of the following account combinations.
    • Invoice liability account. It will continue to default from the supplier site configuration.
    • Nonrecoverable tax and recoverable tax accounts. They will continue to default from the tax configuration.
  • Account combinations are derived, using Transaction Account Definition, on Payable’s invoice lines when the following conditions are satisfied:
    • Account derivation through Transaction Account Definition is enabled in the Manage Invoice Options setup.
    • Invoice type is Standard, Debit Memo, and Credit Memo. Not applicable for Payment Request, and Prepayment.
    • Invoice line type is item, freight, or miscellaneous.
    • The invoice line is not matched to the purchase order.
    • Distributions are not yet generated for the invoice line.
    • The invoice line is not canceled,
    • On the invoice line, neither account combination nor distribution set is defaulted from any other setups or provided by the user.
    • The status of the invoice is not incomplete.

Key Resources

Access Requirements

Users who are assigned these Payables job roles can access this feature.

  • Accounts Payable Invoice Supervisor
  • Accounts Payable Supervisor
  • Accounts Payable Manager