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Flow of Accounting entries in Oracle Applications

By
Sivakumar Ganesan
E-Mail:sivakumar3009@gmail.com
Agenda
• Understanding the Accounting
Flow in Oracle Applications
• Transaction Flow
• Modules Covered
• Set up required in Oracle
Applications
• Defaulting Accounts
• Posting to General Ledger from
Sub-Ledger
• Posting in General Ledger
Understanding the flow of
Accounting in Oracle
Applications

Receivables Purchasing

Payables

Assets

SAP

Interfaces General Ledger


Other Legacy with GL
Sources

Projects

Accounting
Engine
Cash Mgmt Cost Mgmt
Transaction Flow
• Create Opening Balances in General ledger and
Subledger
• Place Purchase order
• Receive the Materials into Stores
• Receive the Supplier Invoice from Supplier
• Match the Supplier invoice with PO and make
Payment
• Issue Materials to Production
• Complete the Production Order and Build
Inventory
• Ship the Material to Customer
• Raise invoice on Customer
• Receive Cash from Customer
• Reconcile the Payment and Receipt in Cash
Modules Covered
• Oracle Purchasing
• Oracle Payables
• Oracle Inventory
• Oracle Manufacturing (WIP
Accounting)
• Oracle Order Management
• Oracle Receivables
• Oracle Cash Management
• Oracle General Ledger
Cost Calculation

FG/Sub Assembly Total Cost

Item Cost Operations Cost

Purchased Item/ Routing


Sub Assembly Cost
Operations Rate X Usage

Production / Service Departments Department Usage

Men, Money, Machine Resources Rate


Set up Required in Oracle
Applications
• Each Module has a Parameter screen or
Controlling Screen through which the Accounts
are Defaulting
– Ex (Inventory Organization for Materials in
Inventory Module, Receiving options for
Inventory Receipt in Purchasing Module,
Financial Options for Payables)
• There are other places also where we can
define the Accounts and there is an inbuilt
hierarchy within the Applications as to where
from the Accounts need to be defaulted
• Each Module Needs to set the Accounts for an
Accounting Event Happening in that Module
Defaulting Accounts in
Case of Purchasing
Defaulting Accounts in Case of
Purchasing
Posting to General Ledger from
Sub-Ledger
• Sub-Ledger Accounting Entries are Transferred
to General Ledger Interface table through the
Concurrent Programs
• We can schedule the concurrent Process to
Transfer Data to GL instead of manually
running the concurrent Programs.
• You can run the Process Daily, Weekly,
Monthly
• You can transfer the data either in
– Summary or (Total Transaction for an
Account Combination per day)
– Detail (Each Transaction)
Posting in General
Ledger
• This Process Transfers Data from GL
Interface Tables to GL Main Tables
– (i.e) From GL_JE_INTERFACE table to
GL_JE_HEADERS and GL_JE_LINES
• Once the Data is Posted No further changes
to the Data is permitted
Accounting Events – Oracle
Purchasing
• Oracle Purchasing
Inventory Accruals
Transfer to Sub Inventory
Purchase Price Variance
Invoice Price Variance (IPV) and
Exchange Rate Variance
Return to Supplier From Receipt
of Materials
Inter-organization Transfer
Accounting Events – Oracle
Payables
• Invoices
 Invoice
 Invoice adjustment
 Invoice cancellation
 Prepayment application
 Prepayment un-application
• Payments
 Payment
 Future dated payment maturity
 Payment adjustment
 Payment cancellation
 Payment clearing
 Payment un-clearing
Accounting Events –
Manufacturing (WIP)
• Oracle Inventory
Material Transfer from Stores to
WIP
WIP Completions and Material
Consumption Entry
Operations Completion Entry
Finished Goods Stock Creation
Entry
Inter-Org Transfer
Sub-Inventory Transfer
Accounting Events – Order
Management
• Order Management
Cost of Goods Sold Entry in
Inventory Module
Accounting Events – Oracle
Receivables
• Transactions
Invoices
Debit Memos
Commitments
Invoices Against a Deposit
Invoice Against guarantee
Credit Memos
On Account Credit Memo
Accounting Events – Oracle
Receivables
• Receipts
Unapplied Receipts
On account Receipt
Applied Receipt
Reverse Receipt
Charge back
Adjustments
Miscellaneous Receipts
Bills Receivables
Accounting Event – Cash
Management
• Oracle Cash Management
Cash Receipt Clearing
Cash Payment Clearing
 Journals
Open Interface
Accounting Event – General
Ledger
• Oracle General Ledger
Journal Entries Created from Sub
Ledger
Manual Journal Entries created in
GL
Inter-Company Transfer Entries
Translation entries
Revaluation Entries
Flow of Accounting
in oracle
Applications
Case Study