46801357 SLA and Cost Acctg

8/6/2019 46801357 SLA and Cost Acctg

1/57

Cost Accounting As You Want It EBS R12 Cost Accounting with SLA

Collaborate09May 3 - 7, 2009

Diane Streubel

[email protected] Foods

Manager for Cost & Systems DevelopmentOAUG Process MFG Cost Sub-Committee Lead

Douglas Volz

[email protected] Volz Consulting, Inc.President / Managing Director

OAUG Discrete MFG Cost Sub-Committee Lead


2/57

Agenda

O racle Discrete Costing SLA enhancements

O racle Process Costing MAC transitioning to SLA

O racle SLA Concepts

Case example: Product Line Accounting

Slide 2 Cost Accounting As You Want It EBS R12 and SLA


3/57

Release 11i account recognition pain points eliminated bySubledger Accounting (SLA):

SLA removes limitations for recording C OG S andRevenue (Cost Account G enerator/workflow and A/R

AutoAccounting are still in use)

G ives you the ability to record inventory and WIP accounts

with more flexibility

Or acle Disc r ete Costing SLA enhancements:

Incr eased Flexibility



4/57

F lexible variance account recognition for: Invoice price and purchase variances Average cost adjustment

Standard cost adjustment Manufacturing variances Account aliases F reight charges

Most other inventory, manufacturing and relatedaccount entries

Or acle Disc r ete Costing SLA enhancements:

Incr eased Flexibility



5/57

Or acle P r ocess Costing:

MAC tr ansitioning to SLA



6/57

Converged inventory model

Inventory O rganizations that are Process will use ProcessCosting

Process users are denied access to Discrete Costingforms Process Enabled organizations can not setup costs in

the Discrete Costing application

Sub Ledger Architecture (SLA) replaces MAC

O PM MAC t r ansitioning to SLA



7/57

Cost Setup Calculate Cost Store Costs MAC Oracle GL

GMI(OPM Inventory)

Purchasing GMD, GMEOrder Management

11i OPM




8/57

Cost Setup Calculate Cost Store Costs SLA Oracle GL

OracleInventory

Purchasing GMD, GMEOrder Management

R12 OPM




9/57

Subledger accounting is an intermediate step betweensubledger products and the O racle G eneral Ledger

Each transaction that requires accounting is representedby a complete and balanced subledger journal entry,stored in a common data model.




10/57

Subledger GL Export Journal Import Journal Posting

Inter f ace

General Ledger

For G/L integration, discrete costing works the same as OPM costing

11i OPM




11/57

PayablesPayables

ReceivablesReceivables

ProjectsProjects

Oracle Subledger Accounting Oracle General

Ledger

OPM

R12 OPM

For G/L integration, discrete costing works the same as OPM costing




12/57

OPM MACCompleted material

and/or resourcetransactions.

OPM Costing Enginegenerates costs.

OPM Subledger process processes

these transactions tocreate Journal entries

SLA

Cost Pre-processor will create

accounting Events

SLA accountingprogram processesthe events to createthe journal entries

Completed materialand/or resource

transactions.

OPM Costing Enginegenerates costs.




13/57

O PM MAC SLA C O MMENTSF iscal Policy Retained with few modifications

Event F iscal Policy Retained with few modifications

Source Process Category

Event Event Entity

Sub-Event Event Class

Account Titles Journal Line Types (JLT)

Accounting Template Application AccountingDefinitions (AAD)

Users can define their own AADs or modify seeded information

Account Mapping Attributes (SLA) Sources SLA sources are used in ADRs

Priorities and AccountMapping Account Derivation Rules (ADR) More flexible. Mapping can be doneat Accounting flexfield level as wellas segment level

Test Mapping Test Accounting Builder (TAB)

O PM Currency, O PM Ledger,O PM Exchange Rates

Use G L setups




14/57

O PM MAC SLA C O MMENTS

Test and Actual Subledger Accounting

Draft and F inal Accounting

Subledger Program Accounting Pre-Processor

Run Subledger for multiplevaluation/cost methods for a ledger

Supports multiple valuationmethods

In O PM there can only beone representation at atime. SLA supportsmultiple representations atthe same time

Run Subledger process for

a functional area

Run Pre-Processor by Process

Category

F lexible. User can have

any number of categories. Assigned to one or moreevent classes

Detailed Subledger Report Is retained and has beenmodified to use SLArepository




15/57

Most of the steps are automated using migrationscripts

All the Account Definitions would be migrated as ADRsManual Steps to be completed are: Assign Account Derivation Rules to Journal Line

Definitions Validate Application Accounting Definition Assign User Subledger Accounting Method to Ledger




16/57

H istorical O PM Subledger distribution data notmigrated to SLA Data refers to O PM Inventory

H istorical data available in query mode




17/57

Update the Account Derivation Rule conditions.Ex: Add Item/Item Class/Organizations

Validate the Application Accounting Definition

Run OPM Accounting Pre-Processor

Run Create Accounting in Draft mode

Check Create Accounting report and JournalEntries report

Run Create Accounting in Final mode to create GLaccounting entries

Run OPM Accounting Pre-Processor




18/57

NO LO SS of functionality by moving to SLA modelNew menus created under O PM F inancials for newSLA forms

F iscal Policy and Event F iscal Policy screensretained with minor modifications. Most of the fieldswill be read-only.O PM Event model mapped to SLA event model.




19/57

Or acle SLA Concepts



20/57

1. Determine sources of information for your account derivationrules (understand the underlying business logic and data)

2. Create account derivation rules (and optional mapping sets)

3. Create journal line types4. Create a journal lines definition

(link the journal line type to the account derivation rule)5. Create an application accounting definition

(copy an existing definition and modify it and then validate it)

6. Create a subledger accounting method (SLAM)(copy standard accrual and create a new one)

7. Assign the new SLAM to a Ledger

Subledge r Accounting Method (SLAM)Setup Steps



21/57

Event Model: definition of the subledger transaction types andlifecycle

Entity : Classification of source of transaction Event Class: Classifies transaction types for accounting rule

purposes Event Type: for each transaction type, defines possible actions

with accounting significance

ENTITY Material T ransaction, Receivingor W IP or Write Off

EVENT CLASS

Logical grouping of events whichhave similar kind of accounting

EVENT TYPE

T he most granular level of business event which hasaccounting impact

K ey Concepts fo r SLA T r ansaction Types



22/57

JOURNAL ENTRY SETUPS

Define/copy and modify journal line types

Define/copy and modifyaccount derivation rules

Define/copy and modifydescriptions

PROCESS

Enter Transaction(s)

Cost Manager

Create Accounting* Transfer Journal Entries to GL

*Run Create Accounting Cost Management concurrentrequest for accounting all transactions from the CostManagement SLA responsibility.

Receiving Accounting can be generated in the Purchasingresponsibilities using the Create Accounting Receivingconcurrent request.

These requests have an option to transfer the entries created toGeneral Ledger. A separate process is also available.

Setup and P r ocess



23/57

Transactions

Accounting Events

Cost Management SLA

AccountingConfigurations

Subledger Balances

Subledger Journal Entries

AccountingProgram

Journal Entry Setup

GLJournal Entriesand Balances

Setup and P r ocess



24/57

SLA Accounting Tables

Enter Transaction(s)

Basic Table St r uctu r e fo r SLA


TransactionAccounting Tables

Cost Manager

XLA_AE_HEADERS

XLA_AE_LINES

XLA_DISTRIBUTION _LINKS

XLA_EVENTS

Same CostTransactionAccounting

Tables

CreateAccounting

GL_INTERFACE

G/L Tables

GL_LEDGERS

GL_JE_HEADERS

GL_JE_LINES

GL_JE_BATCHES

One CommonAccountingSubledger

Table


25/57

Case Example:

P r oduct Line Accounting fo r Disc r ete andP r ocess Costing



26/57

Say there are two brands of cell phones, Samsung and Nokia

We want to track variances by cell phone brands

We are going to use 2 different ways to address this samerequirement Cost/SLA mapping set capability

(works for Discrete and Process Costing) Category Accounting R11i Cost Accounting migrated to

SLA in R12.1(only works with Discrete Costing)

Example:

Pu r chase P r ice Va r iance p r oduct Line



27/57

Cost/SLA Mapping Set Capability

(fo r Disc r ete and P r ocess Costing)



28/57

Product Line Setup Steps Using SLA mapping set

1. Create the product line information in your item master

2. Enter your SLA account derivation rule for Purchase PriceVariance accounts

3. Associate the new account derivation rule to your Journal

Line Type

4. Associate the Application Accounting Definition withSubledger Accounting Method

Cost SLA Mapping Set Capability:

PPV by pr

oduct Line



29/57

Product Line Accounting Descriptive flexfield




30/57

Product Line Accounting Item Descriptive FF




31/57

Assign product line code to the inventory item


TIP: you can use an existing product line category set to populateyour item master DFF, you do not need to enter this one-by-one



32/57

Mapping set Account Derivation Rule




33/57

Mapping set Account Derivation Rule




34/57

SLA Journal Line / Derivation Rule




35/57

Associate Journal Lines Definition to the Event Class


Dont forgetto validateyour new

AADs



36/57

Note the same ADR is usable for Standard Cost Update




37/57

Note the same ADR is usable for Standard Cost Update




38/57

Associate SLA Definition to the SLA Method/Ledger




39/57

The material subledger from 11i still exists


Inventory

Inventory

PPV

Receiving

MatlO verhead

Absorption



40/57

SLA Entries That G o to Your G /L




41/57

F or the Standard Cost Updates That G o to Your G /L




42/57

Catego r y Accounting

Disc r ete Cost Accounting mig r ated to SLAin R12.1



43/57

Create a newstructure under the key flexfield

Item Category

P r oduct Line Catego r y Accounting



44/57

Create a newstructure under the key flexfield

Item Category

Create categorycodes




45/57

Create a newstructure under the key flexfieldItem Category


Create categoryset




46/57

Create a newstructure under thekey flexfield ItemCategory


Create category set

Assign ProductLine Accountingfunctional areacategory set




47/57

Assign product line category accounts




48/57

Account Derivation Rule would have used a source directly




49/57

Summary Notes Product line accounting can be achieved in many ways without

using the Costing H ook.

In R12 SLA is theO

racle R12 accounting platform and Costingsupplies application sources from INV, WIP, RCV to build theaccounting journals.

One caveat: Pre-Release 12 subledger accounting reports arereading data from Costing distribution layer (such as the Material

Account Distribution Summary or Detail Reports). Those reportswill not show SLA journals. SLA provides a set of newaccounting reports (such as Journal Entries Report, Accounting

Analysis Report) which can be modified as desired using BIPublisher.




50/57

Inventory Period Close Process Inventory interim G /L transfer has been replaced by SLA The Inventory Accounting Period close works just like it did

before, however, SLA now sends accounting information to the

general ledger Upgrade Process Customers have option of migrating the whole historical data to

SLA or choose which periods data to be migrated. Customers get option to either upgrade in downtime when

upgrading or anytime after the upgrade process. Default for Cost management is to migrate the present calendar

year data to SLA.

Disc r ete Invento r y Pe r iod Close and Upg r ade



51/57

Acknowledgements of assistance:

Herve Yu Oracle Cost Management Development Manager

Audrea Auld Oracle University Senior Financials Instructor

Russell Bayles Oracle Principal Product Strategy Manager

Michel Basinet Oracle Director Fusion Costing Product Strategy



52/57

Additional information available from:R12 Oracle Subledger Accounting Implementation Guide

R12 Oracle Cost Management User Guide

R12 Oracle Process Manufacturing Cost Management - User Guide



53/57

THANK YOU THANK YOU



54/57

Appendix

Professional Background for Diane Streubel

Professional Background for Douglas Volz



55/57

Diane St r eubel

Professional BackgroundDiane Streubel is the Cost & Systems Development Manager for Schreiber F oods. A processmanufacturing company, Schreiber is the worlds largest supplier of private label dairy products and hasbeen using G emms/ O PM for the past 13 years. Diane has been involved with O PM from its inceptionat Schreiber with G emms 3.1. She has been involved in implementing additional products within O racleat Schreiber and has played a key role in all of the upgrades within the company. Schreiber F oods iscurrently at 11.5.10.

Diane is also actively involved in the Process Manufacturing SI G . She has been the Costing Sub-Committee chairperson and the Membership chairperson for the Process SI G since 2001. As theProcess SI G Enhancements chairperson, she has worked with the Process Manufacturing team atO racle to develop and coordinate an Enhancements Voting process each year since 2001. She hasbeen on the paper selection team for O AUG conferences for the past four years. Diane has alsopresented numerous papers at O penWorld and O AUG conferences over the past several years onO PM Costing topics.

Core ExpertiseUpgrades for Process ManufacturingProject Management

Core manufacturing processesO PM Cost ManagementO PM InventoryO PM F ormulas

ExperienceWithin Schreiber F oods:

Responsible for O PM Costing and Inventory testing andvalidations for all upgradesDevelop and improve processes wi thin Company relatedto Costing, Inventory and F ormulasEstablish Cost Accounting methods, cost and productionformula structures, inventory and production transactionprocesses and system documentation.Train F inance employees at 17 plant facilities on O PMprocesses



56/57

Douglas Volz

Professional BackgroundDoug Volz is a Senior Architect and Advisor for O racle Application projects, with a particular interest inProject and Cost Management. H e has 30 years experience, including 5 years in O racle Development(co-designing O racle Cost Management), 12 years in industry for manufacturing and distributioncompanies, and 14 years consulting. H is Manufacturing and Cost systems experience covers projectmanagement, software design/development, delivery and consulting services, for both O racleCorporation, and multiple international consulting firms. Prior to his systems career, Mr. Volz also heldnumerous management accounting positions for telecommunications, defense, and electronics firms.

In his consulting roles, Doug has served over 100 clients. Many of these were multi-org, multi-currencywith global footprints. Countries include US, Mexico, UK, Netherlands, Belgium, Taiwan, P.R. O .C.,Norway, Japan and G ermany.

Doug leads the Cost Sub-Committee, for the O AUG Discrete Manufacturing Special Interest G roup.H e also advises and participates on the O racle Customer Advisory Board for F usion Costing and for theF usion SCM Strategy Council.

Core ExpertiseMulti-organization, Multi-currency ERPImplementations

Project Management and Senior Project Advisor Core manufacturing processesCost ManagementInventoryBills of MaterialWIP

Systems Integration and Data Conversions

ExperienceSample of clients served:

Beckman Coulter (US)

O nninen AS (Norway)Matsushita (UK, Mexico)NTL (now Virgin Media)Idec Izumi (Japan)Motorola (UK, US)Logitech (US, Taiwan, P.R.C.)



57/57

End of P r esentation

Slid C A i A S 12 d S A

Documents

46801357 SLA and Cost Acctg