Journal Line Rules
Journal line rules are defined within the context of accounting event classes. A journal line rule can be used in a subledger journal entry rule set that has the same event class. You may also assign conditions to the journal line rule.
How You Create Journal Line Rules
Journal line rules are assigned to journal entry rule sets.
To create a journal line rule, select values for options such as:
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Side (Debit, Credit, Gain or Loss)
For example, when a payables invoice is generated, the liability account should normally be credited. The journal line rule must therefore specify the Side option as Credit. On the other hand, the payment of the Payables invoice must be accounted with a debit to the liability account. A separate journal line rule must be defined to create this debit line.
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Merge Matching Lines: To summarize subledger journal entry lines within each subledger entry. Journal entry lines with matching criteria are merged. Here is the list of matching criteria that are used:
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Account combination
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Accounting class
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Anchor line (for PeopleSoft Accounting Hub Cloud)
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Budgetary control status
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Business flow class
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Conversion date
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Conversion rate
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Conversion rate type
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Currency
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Description
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Encumbrance type
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Gain or loss
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Gain or loss reference
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Merge matching lines
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Multiperiod accounting class
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Reconciliation reference
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Replaced account
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Rounding class
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Supporting references
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Switch side
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Third party
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Third-party site
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Third-party type
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Transaction rounding reference
When Merge Matching Lines = All, DR and CR lines with the same merge criteria are merged together with a net amount. It will only result in 1 line, either in DR or CR.
When Merge Matching Lines = No, accounting lines are not merged even when merge criteria have the same values.
When Merge Matching Lines = Debit or Credit, DR and CR lines with the same merge criteria are merged separately by the side. DR lines are merged to DR and CR lines are merged to CR. It may result in both debit and credit lines.
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Accounting Class
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Select an accounting class to classify journal entry lines.
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For example, when a validated Payables invoice is accounted, the Item Expense and Liability journal lines are created. In this case, the journal line rules used in the accounting rules are assigned Item Expense and Liability accounting classes respectively.
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Switch Debit and Credit: Reverses a debit for a credit and a credit for a debit. For example, you can select this option to ensure that if a negative amount is entered for a journal, the journal line is created with positive amount in the opposite side.
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Conditions: To restrict the use of a journal line rule by controlling when a particular journal line rule is used by the Create Accounting process.
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Accounting Attributes: When creating a journal line rule, accounting attribute assignments are automatically established. These are based on the default accounting attribute assignments for that journal line rule's accounting event class. You can override this default mapping of standard sources to accounting attributes. The list of values for the source override includes all sources assigned to the accounting attribute, for the event class associated with the journal line rule.
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Advanced Options
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The Subledger Gain or Less Option: Applies only to amount calculations for the primary ledger. Gain or loss amounts aren't converted to reporting currency or nonvaluation method secondary ledgers. If the option is selected, the journal line holds the gain or loss amounts calculated by the subledger.
The gain or loss amount is calculated as the difference in applied amounts due to fluctuations in conversion rates, based upon conversion to the ledger currency. Foreign exchange gain or loss amounts occur when two related transactions, such as an invoice and its payment, are entered in a currency other than the ledger currency, and the conversion rate fluctuates between the times that the two are accounted.
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The Rounding Class Option: Along with transaction rounding, groups journal lines together and calculates transaction rounding. Subledger transaction rounding differences can occur when a transaction has multiple-related applied-to transactions, such as a Receivables invoice that has multiple associated receipts.
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The Link Journal Lines Option: Determines whether the journal line rule is set up to establish a link between the accounting of transactions that are related both within the same application, and across applications. The alternatives are described in this table:
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This table contains the Link Journal Line Options and their descriptions.
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Link Journal Lines Option |
Description |
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None |
No link is established. |
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Copy from corresponding line |
Build account for a journal line using segments from the offsetting entry of the current journal line. For example, when the business process requires that a cost center incurring an expense must also bear the invoice liability and cash outlay. |
Defining Conditions for Journal Line Rules
You may set conditions to specify whether the journal line rule is used to create a subledger journal entry line. If the conditions are true, the line rule is used to create a subledger journal entry line. Use sources to create these conditions.
For example, you can set up a condition that creates a journal line to record tax, only if there's tax for an invoice. The line type and account class mentioned here are examples of sources.
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The condition for a Payables invoice tax journal line rule could be:
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Where Line Type = Tax
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When this condition is true, there's tax for a payables invoice line. A journal entry line is created to record the accounting impact of the tax.
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Similarly, the condition for an invoice tax journal line rule could be:
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Where Account Class = Tax
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In this case, if there's an account class of Tax, the journal line is used to record the accounting impact of the tax.
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Another example is a condition that creates a journal line for freight when there are freight charges on an invoice.
Journal line rule conditions determine whether a journal line rule and its associated account rules and description rules are used to create the subledger journal entry line. If the conditions of all the journal line rules assigned to the journal entry rule set aren't met, the transaction is processed without the creation of any subledger journal entries, and the event status is set to Processed.