This section discusses:
PeopleSoft Global Consolidations overview.
PeopleSoft Global Consolidations components.
PeopleSoft Global Consolidations phases.
PeopleSoft Global Consolidations processes.
PeopleSoft Global Consolidations data flow.
PeopleSoft Global Consolidations security.
PeopleSoft Global Consolidations enables you to consolidate data from multiple sources, including PeopleSoft General Ledger, other general ledger products, and external flat files. Because PeopleSoft Performance Warehouse serves as the repository for all of the data that the system consolidates, you can load data from multiple sources that have different structures. Global Consolidations provides the tools with which you define the data and its structure, ultimately merging it into a consolidation ledger that shares a common accounting structure, common accounting calendar, and common currency. You can base your consolidations on business units or any other dimension. How you consolidate depends on your specific reporting needs.
During consolidation processing, Global Consolidation eliminates the effect of intercompany transactions among consolidated entities, and equitizes current period earnings of subsidiaries. The system generates eliminating journal entries to an elimination entity that is designed specifically to support consolidated reporting. The types of transactions that the system eliminates are:
Intercompany transactions.
Non-controlling interest obligations.
Investments in subsidiaries.
You can also use Global Consolidations to track and report flow information for cash flow reporting and financial statement disclosures, both from the source ledgers and consolidation journal entries. Global Consolidations also enables you to harmonize your consolidated data so that it can be stated using multiple generally accepted accounting principles (GAAP).
Note. Throughout this documentation, the terms ChartField and dimension are used interchangeably. ChartFields refer to a segment within a chart of accounts, while a dimension provides a broader way to categorize data.
This section describes:
The consolidation model.
The common consolidation business unit.
Elimination entities and the consolidation tree.
Mapping rules and ledger preparation.
Ledger preparation manager.
Consolidation rules.
Consolidation manager.
A consolidation model describes all of the components and rules used for a particular consolidation. It associates the mapping rules and business rules used for processing consolidations with the consolidation tree, the consolidation ledger, and the consolidation dimension. The Consolidation Model page contains links that enable you to review, modify, or create the supporting rules and objects that are used in a consolidation. When defining the parameters for your consolidation, you can use the Consolidation Model page as the main way to access all of the pages that are used to define a consolidation.
This screenshot shows how to enter parameters for the consolidation model:
Each consolidation model is associated with a scenario ID. When establishing scenarios for use with consolidations, select the Consolidated check box on the Scenario Definition page. You can define multiple scenarios to process multiple consolidations that use different business rules, such as different base currencies, different consolidation trees, or different consolidation rules. When you run the consolidation processes, the system derives the correct consolidation model based on the input parameters of the common consolidation business unit and scenario.
See Understanding Models and Scenarios.
When processing consolidations, you run the process for a specific business unit, scenario, fiscal year, and accounting period. For consolidations, this business unit must be the "common consolidation business unit." This represents the highest level business unit to which your data is consolidated. It doesn't necessarily represent an actual business unit in your organization; it can be a "logical" business unit. You associate this business unit with the consolidation ledger, which stores the activity related to a consolidation. This business unit is the basis for your consolidation reports, processing, and inquiries.
To establish a common consolidation business unit, use the Warehouse Business Unit page, and set the business unit type to consolidated. You must associate the common consolidation business unit with the scenario IDs which you associate the consolidation model.
See Also
The hierarchical reporting relationships among the entities in a consolidation are defined in a node-oriented consolidation tree. Each branch of the tree must contain a single elimination entity. The journals that result from consolidation processing at each branch (eliminations for minority interest, intercompany transactions, or equitization) are booked to these elimination entities.
For example, World Wide Consolidation is composed of multiple business units, with consolidation occurring at several levels before ultimately consolidating to World Wide Consolidation, which is the common consolidation business unit. For financial reporting requirements, a tree that defines the legal entity relationships among these business units was created, which is the consolidation tree. Note that each branch contains an elimination entity:
Elimination entities
If your consolidation is by business unit, the elimination entity must be a defined warehouse business unit. If your consolidation is by another dimension, such as department, then the dimension values (for example, the Dept IDs) must be defined. In either case, the elimination entity must be identified by using the Elimination Entity page. When you consolidate by a dimension other than business unit, you still need to create a business unit tree, because the ledger preparation process requires it.
See Also
Before you process consolidations, you must move the individual subsidiary business unit ledger data into a consolidation ledger table. For this to occur, you must establish a common structure among the various ledgers by defining mapping rules for calendars, currency, and accounts (ChartFields). These rules are used to transform the subsidiaries' data into a common calendar, currency, and chart of accounts and define what the data in the individual ledgers represents with respect to the consolidation ledger.
For example, your consolidation ledger uses an accounting calendar that includes 12 periods and begins on January 1. The ledgers from your various subsidiary business units may not follow this same calendar. The calendar mapping rule defines how data is mapped from the subsidiary calendars to the consolidation ledger's accounting calendar so that the subsidiary data moves to the appropriate period of the consolidation ledger.
After you define the mapping rules, you run the Ledger Preparation process, which moves the various subsidiary ledger data into the consolidation ledger, transforming it according to the associated mapping rules. The consolidation ledger is used as input for consolidation processing. If your subsidiary ledgers are already in the same format as the consolidation ledger, then you can indicate in your mapping rules that no mapping is required.
See Loading Data Using Extract, Transform and Load (ETL) Jobs.
The Ledger Preparation Manager page conveys the status of each phase of ledger preparation processing. This interactive page enables you to quickly visualize the status of preparing your subsidiary ledger data and view details for any phase; you can configure this page to best suit your implementation.
The ledger preparation manager has two views, one for the Preparation phase (up to and including loading the consolidation ledger) which is tracked by source business unit and source ledger, and another view for enrichment (activities on consolidation ledger after ledger preparation is run, but before consolidation is processed) which is tracked only by source business unit and not source ledger.
When you define a consolidation model, you associate several rules that are used when consolidation processes are run. You define the following rules:
Define ownership rules to establish ownership percentages.
Define elimination rules to eliminate intercompany transactions.
Define equitization rules to eliminate investments in subsidiaries and subsidiary equity and generate equitization entries.
Define non-controlling interest rules to generate eliminations due to non-controlling interest.
Define balancing account type rules to balance the consolidation ledger.
Define close processing rules to perform period-end or year-end close processing.
Define flow templates to generate and process flows.
Define publishing rules to publish journals back to the source ledger.
The Consolidation Manager page conveys the status of each phase of consolidation processing. This interactive page enables you to quickly visualize the status of processing consolidations and view details for any phase. You can configure this page to best suit your implementation.
This section discusses:
Global Consolidations Phases Overview.
Load data.
Standardize and transform data.
Process consolidations.
Report and analyze consolidation results.
You complete these phases while using Global Consolidations:
Load your subsidiary ledger data.
Standardize and transform the subsidiary ledger data to the common consolidation ledger structure, and load it into the consolidation ledger.
Process consolidations.
Review and analyze the consolidated results; generate reports.
This diagram illustrates the PeopleSoft Global Consolidations phases of consolidation and the activities performed during each phase:
PeopleSoft Global Consolidations phases of consolidation
First, you load your subsidiary data into PeopleSoft Performance Warehouse by using the extract, transform, and load (ETL) tools, the source data (flat file) load utility, or the online manual ledger data entry component.
During this phase, you run the ledger preparation process, which transforms your data to the common consolidation structure and moves the data into the consolidation ledger. Also, you can run the currency translation process to update prior balances to the current exchange rate. Optionally, you can enter journals or run allocations to adjust the source balances before running the consolidation processes. You also have the option of entering flow amounts to track account movement for source balances.
The main Global Consolidation processes are eliminations and equitizations.
The elimination process eliminates balances attributed to intercompany transactions from the consolidation ledger by using elimination rules to determine the accounts to process.
The equitization process recognizes a parent's equity in the earnings of a qualifying subsidiary and generates the associated elimination entries.
The output of running these processes are journals that are posted to the consolidation ledger, either as the last step during processing, or later by running the PeopleSoft Performance Warehouse Ledger Post engine.
Any journals created during the consolidation phase will adjust account balances on your consolidation ledger. You can track the account movement using journal flows for the amounts resulting from these posted journals. You can also publish journals back to your source general ledger. This applies to journals that were manually entered, generated through allocations, or generated by the consolidation processes. Finally, you can run the close process which closes and rolls forward account balances either to the next period or the next fiscal year depending on your consolidation ledger type.
In this phase, which takes place after consolidation is complete, you use the available analysis and reporting tools to review and analyze your results. There are many online pages that enable you to view the results, as well as the Consolidation Manager and Ledger Preparation Manager pages, which show you the progress of various stages of processing. In addition, PeopleSoft delivers several report definitions for Structured Query Report (SQR) and PS n/Vision.
See Also
Understanding the Analysis and Monitoring Tools
Generating Consolidation Reports
This section discusses these consolidation processes:
Ledger preparation.
Currency translation adjustment.
Source flow update.
Eliminations.
Equitizations.
Journal flow update.
Journal publish.
Closing.
After your source ledger data resides in the PeopleSoft EPM database tables, you need to prepare the data before you can use it as input for any consolidation processes. Because the subsidiary ledgers may use different accounting calendars, account structures, and store amounts in different base currencies, they must be transformed to a common structure prior to consolidations. Data that has been transformed to this common structure resides in the consolidation ledger.
To prepare the subsidiary ledger data for the consolidation ledger, you define a series of mapping rules, add them to ledger preparation rules, and then run the ledger preparation process. After the ledger preparation processes are completed, the source ledger data is converted to the common structure, based on your mapping rules, and moved into the consolidation ledger. The data in the consolidation ledger is subsequently used as input for consolidation processes.
If your source subsidiary ledger data is in the same format as the consolidation ledger, when you define its ledger preparation rule, you can indicate that no preparation is required.
See Also
Understanding Data Preparation
Currency adjustment processing generates beginning balances for the current period, using prior period data that already resides in the consolidation ledger. Because the currency adjustment engine processes prior period source ledger activity, the currency adjustment is run after the ledger preparation process and is tracked through the ledger enrichment manager.
Oracle's PeopleSoft Global Consolidations flows feature provides the ability to capture the change in account balances for a specified period. By considering the different type of flows (or activities) affecting the net balance of an account, you can reconcile account variation using account activities that traditional ledger mapping of accounts is unable to capture.
Data flows for consolidations are used to track and reconcile gross variation. Gross variation is the difference between the opening and closing balances of an account, which can be caused by many activities. For example, the gross variation of fixed asset accounts could be distinguished by additions, disposals, asset impairment, currency translation, and reclassification. Reporting the data flow for specific accounts is often required as part of regulatory reporting.
Source flows are amounts associated with the source data after it goes through the ledger preparation process and can be tracked by both manual and system flow codes. Source flows are entered in the local book currency and translated at both the closing and cash flow rates.
During the ledger preparation phase, you input, review, and correct amounts for manual flow codes on the Source Flow Input page as needed, and then run the source flow update engine.
Elimination processing uses the elimination and non-controlling interest rules that you establish to eliminate amounts due to intercompany transactions, eliminate parent investment and subsidiary equity amounts, and generate a non-controlling interest offset.
Any out of balance amounts are booked to the elimination entity attached to common node between the two entities with interunit transactions. You can view these entries on the trial balance inquiry and drill down to the consolidation log which provides details about which rule generated the entry. You can also run the match report or inquiry which compares all interunit activity and how it is eliminated.
Equitization processing uses the ownership and equitization rules that you establish to equitize the current period earnings of subsidiaries, and books the earnings to the parent. It also generates non-controlling interest adjustments against the subsidiary's change in equity. Running this process is optional; whether you choose to use it depends on your organization's reporting requirements.
When producing consolidated financial statements, you eliminate equitization entries and create non-controlling interest entries related to the equity generated by the subsidiary during the period. These are both options with the equitization process. If specified, the equitization process creates the elimination entries that "back out" the equitization entries and sends them to the proper elimination entity as indicated in the consolidation tree. It also calculates the non-controlling interest expense and liability for the subsidiary's equity for the period.
Journal flows are amounts associated with journal entries or batches posted for the consolidation fiscal year and period, and can be tracked with both manual and system flow codes. Journal flows amounts are entered in the consolidation currency.
The Journal Flow Update process updates both system-generated and manually input flow data associated with journal entries for the consolidation fiscal year and period.
The journal publish feature enables you to send journals that are generated in Global Consolidations back to source systems that subscribe to these messages. Journals are published as XML messages.
You set up data mapper rules that define which ChartFields the system publishes. Data mapper rules can also provide additional information not available in the in the journal data. For example, you can use data mapper rules to specify the values for the LEDGER_ID and AFFILIATE fields. Data Mapper also works in conjunction with ledger preparation. You can "reverse map" the changes done during the ledger preparation process.
The close process uses closing and roll forward rules to close and roll forward account balances either to the next period or the next fiscal year depending on your consolidation ledger type. Trial balance-based consolidations use year-end processing, and financial statement-based consolidations use period-end processing. After the close process has run, you can review the results on the Ledger Inquiry page.
These diagrams illustrate the flow of data through PeopleSoft Global Consolidations:
PeopleSoft Global Consolidations data flow (1 of 3)
PeopleSoft Global Consolidations data flow (2 of 3)
PeopleSoft Global Consolidations data flow (3 of 3)
PeopleSoft Global Consolidations uses the security defined within PeopleSoft Enterprise Performance Management to control access to data. To enable row-level security, use the General Options page.
See Also
Understanding System-Wide Security and Processing Options