Division

The following two types of divisions are used while defining a contract type:

• General Ledger (GL) Division - GL divisions typically comprise of individual entities (for example, companies) in the general ledger. You must set up a GL division for each such entity. The GL division is used to define the accounting period for financial transactions linked to contracts. Contracts are associated with GL divisions through their contract type. The system uses accounting periods to prevent a user from creating financial transactions in the closed periods. It also uses accounting periods when it generates the flat file that contains the consolidated journal entry that is interfaced to the general ledger.

• Division - A division is associated with a jurisdiction. A jurisdiction is a geographic-oriented entity with unique business rules. For example, if you conduct business in California and Japan, each jurisdiction has different set of rules, and therefore you need to have a separate jurisdiction for each division. You must set up a division for each jurisdiction in which you conduct the business. For the Pricing Management functionality, setting up a division is mandatory, and the system must contain information about at least one division.

A division is associated with the following:

• Person - You may or may not associate person to a division. It is optional. But, when you are using division specific functionality, you have to associate person to a division while creating a local person.

• Contract - Contract is associated to a division through its contract type. The contract type controls multiple business rules which are defined for a given jurisdiction and contract type combination. In addition to controlling the business rules defined on the contract's contract type, the contract's division also controls the type of collection criteria used to determine if and how to collect overdue debt.

• Account - The division on account when combined with the account's customer class defines the jurisdiction that governs financial business rules (for example, the bill's due date, when and how late payment charges are calculated, etc.). It also allows you to assign To Do entries associated with the account to a given To Do role based on the account's division.

Related Topics

Parent Topic: Oracle Revenue Management and Billing Generic Business Processes