R12 General Ledger Management Fundamentals

R12 General Ledger Management Fundamentals
Period Close R12 General Ledger Management Fundamentals <Course name> <Lesson number> - 1

<Course name> <Lesson number> - 2
Objectives After completing this lesson, you should be able to do the following: Explain the accounting cycle Identify steps in the close process Perform journal import of subledger balances Reconcile to the subledgers Run revaluation Close the period Consolidate account balances Inquire and run reports on final balances <Course name> <Lesson number> - 2

The Accounting Cycle Review/ Correct Balances Run Reports/ Close Period Open Period Create/Reverse Journal Entries Post Review Revalue/Translate Consolidate The Accounting Cycle The following are steps in the General Ledger Accounting Cycle: Open period Create functional and foreign journal entries. Reverse journal entries Convert journal amounts Post and review balances Revalue and translate foreign currency balances Consolidate ledgers Review and correct balances Run accounting reports Close the accounting period <Course name> <Lesson number> - 3

Period Close Checklist
Transfer and import data from all subledgers Perform reconciliation of subsidiary ledgers Close the period for each subledger Revalue foreign currency balances Verify all journals are posted Reconcile account balances Translate balances to parent's currency Consolidate subsidiary ledgers Run Trial Balance and other reports Close the period and open the next period <Course name> <Lesson number> - 4

Overview of Importing Journal Entries
Transfer in Summary or Detail Automatic or Manual Journal Import Subledgers GL_INTERFACE Post Overview of Importing Journal Entries Importing information from Oracle subledgers is a two-step process: Data is pushed into the GL_INTERFACE table from the subledger using a transfer program. Journal Import pulls the information from the Interface table to create valid, postable journal entries in General Ledger. When you initiate the transfer program from Oracle subledgers, such as Oracle Payables or Oracle Receivables, you can choose to also submit the Journal Import process. If you do not choose to run Journal Import from the subledger, you must run Journal Import separately in General Ledger, using the Import Journals window, in order to create postable journal entries. The Journal Import process creates journal entries based on accounting information from either Oracle subledger applications or non-Oracle feeder systems. It loads this data from the GL_INTERFACE table into the GL_JE_BATCHES, GL_JE_HEADERS, and GL_JE_LINES tables of General Ledger. It can transfer journal information in detail or summary. Note: Journal Entries can be transferred anytime during the period. Before closing each subledger, a final transfer should be performed. Oracle Assets transfers journal information directly to General Ledger to create unposted journal entries in the GL_JE_BATCHES, GL_JE_HEADERS, and GL_JE_LINES tables. You do not run Journal Import to transfer asset information to General Ledger. Integration with Non-Oracle Systems: If you maintain your subledger information in an external, non-Oracle application, you must write a script to convert data into a format readable by SQL*Loader, to load that information into the GL_INTERFACE table. GL_BALANCES GL_JE_BATCHES GL_JE_HEADERS GL_JE_LINES <Course name> <Lesson number> - 5

Journal Import Verification Process
Load GL_INTERFACE table Correct errors in feeder system Import journals by Source and Group ID Delete source from Journal Import - (Not Oracle Subledger) Do journals have errors? Yes No Number of errors? High Journal import creates a postable journal batch Journal Import Verification Process (N) > Journals > Import > Run Journal Import validates all of your data before it creates journal entries in General Ledger. If you allow suspense posting for your ledger, Journal Import assigns lines with invalid accounts to the suspense account. Journal Import rejects all other invalid lines, and they remain in the GL_INTERFACE table. Journal Import also prints your error lines in the Journal Import Execution report. Journal Import validates the following attributes to ensure that your journals contain the appropriate accounting data: Account combinations Unbalanced journal entries Periods Foreign currency errors Budget information Encumbrance information Other miscellaneous items Before closing the General Ledger, verify that all journal entries have been imported from the GL_Interface table. If not, trouble shoot the remaining entries. Caution: Do not correct or delete journal import data from Oracle subledgers such as Oracle Payables or Oracle Receivables. Corrections do not update the Oracle subledger data causing a permanent out of balance between the General Ledger and the subledger. The Oracle subledgers set flags to indicate the transactions have been sent to Oracle General Ledger. If the import is deleted, these flags must be reset before the transactions can be resent. For more information on Journal Import, see the previous chapter on Journal Entries. Correct Journal Import online (See Caution below) Low <Course name> <Lesson number> - 6

Posting Journals Post journal Enter journal Prepost $500 Journal entry $ 25 After post $525 Account Balance Report and inquire on updated account balances Posting Journals You have three methods to post journal import batches. Batch Posting: Navigate to the Post Journals window to post a group of journal batches. (N) Journals > Post Manual Posting: Select the More Actions button from either the Journals window or the Batch window to post a journal batch at the time of entry. This option is available only if the profile option Journals: Allow Posting During Journal Entry has been set to Yes. When you post a journal, Oracle General Ledger posts all the journals in a batch. (N) Journals > Enter (B) More Actions Automatic Posting: Run the AutoPost program to post journal batches automatically based on a schedule you define. (N) Setup > Journals > AutoPost Correcting Batch Posting Errors: Review the batch to identify the posting error. Common explanations for unpostable batches include: Control total violations Posting to unopened periods Unbalanced journal entries Posting Statuses are: Unposted Pending Processing Selected for posting Posted Error For more information on Posting Journals, see the previous chapter on Journal Entries. <Course name> <Lesson number> - 7

Reconciling Subledger Data
Procure to Pay Order to Cash Projects Non Oracle Subledgers Subledgers Reconciling Subledger Data Before closing the General Ledger, reconcile the subledger data to the General Ledger to be sure that all transactions have been transferred and accounted for correctly in the General Ledger. This can be done using reports and on line account analysis. Analysis Reports <Course name> <Lesson number> - 8

Close the Subledgers Subledgers Close the Subledgers Once the data is reconciled, close the subledgers. A suggested order for closing the subledgers is as follows: Projects: Receives and sends information on expenses from and to Payables. Also receives outstanding purchase orders from Purchasing. Sends Asset lines to Assets. Sends information to General Ledger. Payables: Transfers information to Assets, Projects, and General Ledger. Purchasing: Calculates period end accruals for expense items received but not yet invoiced. If Purchasing closes before Payables, more invoices could be entered causing an out of balance situation. Assets: Receives asset invoice lines from Payables after they have been transferred to the General Ledger. Receivables: Can be closed at anytime in the process. It is not depended on the other modules. Inventory: Transfers inventory cost information. Close after Purchasing and Receivables to ensure that all receiving and shipping transactions have been processed. Note: Order Management updates Inventory during Ship Confirm which precedes the AutoInvoice Process. Therefore, verify that all orders have been processed in Order Management before closing Inventory. Close Period <Course name> <Lesson number> - 9

P2P Close Processes Create Journal Entries Assets General Ledger
Post Mass Additions/ Depreciation Transfer Transactions to GL GL Interface Inventory Mass Additions Create P2P Close Processes Submit the Payables Transfer to General Ledger process to transfer accounting information to the GL Interface. After the Payables Transfer to General Ledger process completes, run the Journal Import process to create unposted journals in General Ledger. Note: The Payable Transfer can now be run as part of a set of programs called the Payables Accounting Process that creates the payables accounting entries, transfers the data into the GL Interface table, and runs Journal import. Purchasing Receipt Accruals - Period End: Use the Receipt Accruals - Period-End process to create period-end accruals for your uninvoiced receipts. This process only generates receipt accruals for items you purchase and receive that are set to accrue at period end. Receipt accruals for items set to accrue on receipt are automatically sent to the GL Interface. In either case, use the Journal Import program with a source of Purchasing to transfer receipt accruals from the GL Interface to the General Ledger Journal tables. Inventory Transfer Transactions to GL: Use the Transfer Transactions to GL process to transfer summary or detail accounting activity for any open inventory period into the General Ledger Interface, including both inventory and work in process entries. When more than one period is open, the transfer selects transactions from the first open period up to the entered transfer date, and passes the correct accounting date and financial information into the General Ledger Interface. Use the Journal Import program with a source of Inventory to transfer accounting information from the GL Interface to the General Ledger. Run this process for each inventory organization. For Assets, run the following processes: Mass Additions Create: Run the Mass Additions Create program to transfer capital invoice line distributions from Payables to Assets. This process creates no accounting entries. After the program completes, invoice distributions may be processed. Post Mass Additions: Once your mass additions are processed, use the Post Mass Additions program to place the assets in service. Run Depreciation: This process calculates depreciation, gain/losses on retirements, and (optionally) closes the period. Create Journal Entries: Use the Create Journal Entries process to create accounting and transfer it directly to the General Ledger. The accounting clears the asset clearing account and charges the asset cost account. Assets does not use the GL Interface. Payables Transfer to General Ledger Receipt Accruals - Period End Payables Purchasing/ iProcurement <Course name> <Lesson number> - 10

Overview of the P2P Period Close
Close the period in AP Prepare for period close Run Invoice Validation/ Review and resolve holds Run Payables Accounting Process to Transfer Run PO Period Accruals Close the PO period Reconcile AP activity for the period Post journal entries in GL <Course name> <Lesson number> - 11

Reconcile AP to GL March Accounts Payable Trial Balance + April Posted Invoice Register - April Posted Payment Register - April Accounts Payable Trial Balance = 0 Reconcile AP to GL Use the following Payables reports to reconcile your transferred invoices and payments to your Accounts Payable Trial Balance to ensure that your Trial Balance accurately reflects the Accounts Payable Liability: Accounts Payable Trial Balance (for last day of prior period) Posted Invoice Register - Invoice journals must be posted in General Ledger to appear on this report. Posted Payment Register - Payment journals must be posted in General Ledger to appear on this report. Accounts Payables Trial Balance (for last day of current period) This balancing process will help you ensure that all liabilities recorded in Payables are reflected in the General Ledger AP Liability accounts. If the balance reported by the Accounts Payables Trial Balance does not equal the balance in the AP Liability account, you can use the Account Analysis report and the General Ledger reports to determine what journals are being posted to that account. Before running your reports, run the Payables Accounting Process with the Transfer to General Ledger Program and Journal Import for all transactions in the period that you are reconciling. Also, be sure to post the transactions in the General Ledger. <Course name> <Lesson number> - 12

Reports Accounts Payable Trial Balance Unaccounted Transactions Report
Uninvoiced Receipts Report Accounts Payable Trial Balance Accrual Rebuild Reconciliation Report Accrual Reconciliation Report Accrual Write-Off Report Matched and Modified Receipts Report Payables Account Analysis Report Reports Accounts Payable Trial Balance: Verify that total Accounts Payable liabilities in Payables equal those in the General Ledger. To reconcile these balances you can compare the cumulative total liability provided by this report with the total liability provided by your General Ledger. Accrual Rebuild Reconciliation Report: Analyze the balance of the Accounts Payable (A/P) accrual accounts. You can accrue both expense and inventory purchases as you receive them. When this happens, you temporarily record an Accounts Payable Liability to your Expense or Inventory A/P Accrual accounts. When Payables creates the accounting for the matched and validated invoice, Payables clears the A/P accrual accounts and records the liability from the supplier site. Run this report at period end. Accrual Reconciliation Report: The same report as the Accrual Rebuild Reconciliation Report with one key difference. The Accrual Rebuild Reconciliation Report creates records in a temporary table which are used as the basis for the report. The Accrual Reconciliation Report simply uses the records created by the Accrual Rebuild Reconciliation Report as a basis for the report. Run this report during the accounting period. Accrual Write-Off Report: Provide supporting detail for your write-off journal entries. The process is as follows: Analyze the Accrual Reconciliation Report for transactions that you should expense out of the accrual accounts. Researched the reported accrual balances. Use the Accrual Write-Off window to indicate which entries you wish to remove and write off from this report. Use the Accrual Write-Off Report as supporting detail for your manual journal entry. Matched and Modified Receipts Report: After you automatically create invoice distributions by matching an invoice for goods to a receipt, that receipt can be modified in Purchasing. For example, you might need to adjust a receipt because the quantity received was incorrectly recorded, or the product was defective and returned to the supplier. Use this report to identify receipts that have been changed after invoice matching, and for which no users have seen modifications. Payables Account Analysis Report: Review and analyze accounting entries in Payables. You can use the report parameters to limit the report to just the accounting information you want to review. The Payables Account Analysis report is helpful when you reconcile your accounts with your General Ledger. For example, you can reconcile the prepaid expense account between Payables and your General Ledger. You can submit this report in detail and compare it to an account analysis report in your General Ledger. <Course name> <Lesson number> - 13

Reports (continued) Payables Accounting Entries Report
Posted Invoice Register Posted Payment Register Receipt Accruals - Period End Receiving Account Distribution Report Reports (continued) Payables Accounting Entries Report: Use this report to review and analyze accounting entries in the Payables subledger. You can request the report for a specific run of the Payables Accounting Process or the Payables Transfer to General Ledger program. Using the report parameters, you can produce a detailed or summary listing of the accounting information you want to review. The report also lists in detail any transactions that have been accounted with error and all entries that could not be transferred to the General Ledger Interface. When a transaction is accounted with errors, use the Update Accounting Entries window to update any invalid accounts. Posted Invoice Register: Use the Posted Invoice Register to review accounting lines, summarized by invoice, that have been transferred to the General Ledger. Because it presents amounts that have been charged to liability accounts, this report is valid only for an accrual ledger. The Posted Invoice Register is primarily a reconciliation tool. Use this report along with the Posted Payment Register and the Accounts Payables Trial Balance Report to reconcile balances between Payables and your General Ledger. Posted Payment Register: Use the Posted Payment Register to review accounting lines, summarized by payments that have been transferred to the General Ledger. Because it presents amounts that have been charged to liability accounts, this report is valid only for an accrual ledger. You can submit the Posted Payment Register for one payment journal entry batch or all payment journal entry batches. The Posted Payment Register is primarily a reconciliation tool. Use this report along with the Posted Invoice Register and the Accounts Payables Trial Balance Report to reconcile balances between Payables and your General Ledger. Receipt Accruals - Period End: Use the Receipt Accruals - Period-End process to create period-end accruals for your uninvoiced receipts for expense distributions. Purchasing creates an accrual journal entry in the General Ledger for each uninvoiced receipt you choose using this window. Receiving Account Distribution Report: The Receiving Account Distribution Report lists the accounting distributions for your receiving transactions. This report supports the distributions created for the following transactions: Purchase Order Receipts Purchase Order Receipt Adjustments Purchase Order Returns to Supplier Deliver to Expense Destinations Return to Receiving from Expense Destinations Match Unordered Receipts This report helps you reconcile your receiving accounting to the General Ledger. <Course name> <Lesson number> - 14

Unaccounted Transactions Report Uninvoiced Receipts Report
Reports (continued) Unaccounted Transactions Report Uninvoiced Receipts Report Reports (continued) Unaccounted Transactions Report: Identify and review all unaccounted invoice and payment transactions and see the reason that Payables cannot account for a transaction. Run this report after you have run the Payables Accounting Process. The report will then show only transactions that had problems that prevented accounting. You can then correct the problems and resubmit the accounting process. Note that this report does not include invoices that have no distributions. Uninvoiced Receipts Report: Run before the Receipt Accrual - Period-End process. With this report, you can review all or specific uninvoiced receipts for both period end and online accruals. Uninvoiced receipts are goods and services you have received that your supplier did not invoice yet. This report indicates exactly what you have to accrue and for what amount, and helps you analyze your receipt accrual entries. The accrual amount is the difference between the quantity received and the quantity billed multiplied by the unit price of the item. Reports <Course name> <Lesson number> - 15

O2C Period Close Process
Order Management General Ledger Send all Orders/Credit Memos Transfer Transactions to GL GL Interface Inventory AutoInvoice Receipt Reconciliation Transfer to General Ledger Cash Management Receivables <Course name> <Lesson number> - 16

Overview of O2C Period Close Process
Post journal entries in GL Review, balance, and reconcile Receivables, Cash Management, and Inventory transactions Complete the transfers from Receivables and Inventory to the General Ledger Review the transfer results, and correct transfer issues Close Receivables and Inventory Periods Overview of O2C Period Closing Process As part of the Order to Cash (O2C) process, accounting information is transferred from Inventory and Receivables to the General Ledger. The Order Management and Cash Management applications send transactions to Receivables and Inventory rather than directly to the General Ledger. <Course name> <Lesson number> - 17

Transferring Inventory and Receivables
Unposted Items Report Transactions out of balance Submit GL Interface program GL Interface Table Transferring Inventory and Receivables Inventory Transfer Manufacturing and Distributions Manager, Vision Operations (USA) (N) Accounting Close Cycle > General Ledger Transfers The General Ledger Interface program populates the GL_Interface tables with Oracle Inventory transaction data. The data is transferred in detail to the Interface table and then pulled into General Ledger in detail or summary. The GL dates are used to specify the data to be transferred. The General Ledger Interface automatically runs when the period is closed. The transactions may not balance if: Transfers from Order Management to Receivables and Inventory are not completed before closing or fail when imported. The General Ledger account is changed to an invalid number before transfer. Manual General Ledger Journal Entries are entered that affect the Inventory accounts. Reports are run prior to all activity being transferred and posted. Receivables Transfer Receivables, Vision Operations (USA) (N) > Interfaces > General Ledger The General Ledger Interface program populates the GL_Interface tables with Oracle Receivables transaction data. The data can be transferred in detail or summary format. The GL start and end dates are used to specify the range of data to be transferred. The General Ledger Interface produces an execution report that shows the total debits and credits transferred from Receivables into the GL Interface table. Compare this report to the Sales Journal and Receipts Journal totals to verify that they match. Reports are run with different date ranges The General Ledger account is changed to be invalid before the transfer Other General Ledger Journal Entries affect the Receivable accounts Transactions in balance Posting Execution Report <Course name> <Lesson number> - 18

O2C Standard Reports Inventory and Receivables provide a comprehensive set of reports and listings Use these reports to review and reconcile transactions, receipts, journals, and customer balances O2C Standard Reports Manufacturing and Distributions Manager, Vision Operations (USA) (N) Reports Use the Material Account Distribution Detail or Summary Report to: View the accounts charged for inventory transactions Reconcile to the inventory accounting transferred to the General Ledger Receivables, Vision Operations (USA) Reports can be run as a concurrent process from the Submit Requests window. Use these reports when needed to review activity at any time during the month. <Course name> <Lesson number> - 19

Reconciling Receivables Transactions, Receipts, and Customer Balances
Reconcile outstanding customer balances Reconcile transactions and receipts Reconcile transaction and receipt accounting flexfield balances Opening balance + Transactions - Receipts = Closing balance Sales Journal by customer Transaction register Receipt register Sales Journal by GL Account Journal Entries Report Receipts Journal Report Reconciling Receivables Transactions, Receipts, and Customer Balances Receivables, Vision Operations (USA) (N) > Reports > Accounting Use the AR Reconciliation Report to start the reconciliation process. It will provide a summary of your customer, transaction, receipt, and account balances for the period that you specify. It can give you a starting point to identify areas that need research. Use these reports to get the detailed information: Sales Journal By Customer – Review all transactions. Transaction Register: Check that all items that can be posted are reflected on the Sales Journal. The Sales Journal balance should match the total of the transactions here after adding the credit memo total twice (because it is a negative on the Transaction Register and a positive on the Sales Journal). Receipts Register: Review a list of receipts. Sales Journal By GL Account: Ensure that the Transaction Register matches the Sales Journal. Journal Entries Report: Review the details that make up the General Ledger journal entries. Receipts Journal Report: Review details of receipts that appear in the Journal Entries report. Aging Report: Use the last day of the prior month to get the outstanding opening balance. Transaction Detail Report: Identify transactions that increase the outstanding opening balance. Adjustments Register: Identify any adjustments that affect the transactions for the month. Unapplied Receipts Register: Determine customer balance after taking into account all on-account and unapplied amounts Applied Receipts Register: Identify receipts that reduce the outstanding opening balance. Invoice Exceptions Report: Identify transactions that reduce the outstanding opening balance. This report shows all transactions where the Open Receivables flag is set to No. Therefore, the transactions do not display on the aging but do show in the Transaction Register. This can occur when an item can be ordered in Order Management but not invoiced, such as an internal ordered item. Submit GL Interface process <Course name> <Lesson number> - 20

Mapping Receivables Transactions to General Ledger Categories
Category in General Ledger Debit Memos Credit Memos and Credit Memo Applications Credit Memos Sales Invoices Chargebacks Trade Receipts Adjustments Miscellaneous Receipts Transaction Type On-Account Credits Invoices Receipts Guarantees Miscellaneous Transactions Deposits Oracle Receivables Transactions Mapping Receivables Transactions to General Ledger Categories If you experience reconciliation issues between transactions and categories use this map to check your setup information. <Course name> <Lesson number> - 21

GL Reconciliation Report for Cash Management
The GL Reconciliation Report: Reconciles the General Ledger cash account to the bank statement balance Lists the General Ledger cash account balance and adjusted balance Lists separately the adjustment amount for unreconciled receipts, payments, journal entries, and bank errors <Course name> <Lesson number> - 22

& Project Close Cycle Create Journal Entries Assets General Ledger
Post Mass Additions/ Depreciation Transfer Labor and Usage Costs Mass Additions Create GL Interface Projects Transfer Project Assets Project Close Cycle Interface costs to General Ledger: PA periods cannot be closed until all labor and usage costs are successfully interfaced to Oracle General Ledger or Oracle Payables. Interface CIP Assets to Oracle Assets: Asset lines can be interfaced to Oracle Assets only after the underlying expenditure items have been interfaced to General Ledger. Interface to Oracle Payables: Ensure that Oracle Payables has not closed its month until all Oracle Projects expenditures have been interfaced, including: Supplier invoice adjustments Expense reports Intercompany and inter-project transactions Transfer Payables Invoices and Expense Reports & Transfer Open Purchase Orders Payables Purchasing <Course name> <Lesson number> - 23

Overview of Project Closing Cycles
Post Closing Tasks Closing Cycle Tasks Enter transactions Closing Cycle Preparation Tasks Overview of Project Closing Cycles Project Periodic cycles group and summarize accounting transactions for reporting and reconciliation. Most Oracle financial subledgers use the General Ledger (GL) fiscal cycles. Use PA period end dates to determine which GL period to assign to the transactions. PA periods in Oracle Projects do not have to match the General Ledger calendar period. PA periods typically are defined in terms of a week. PA periods may cross over multiple GL periods. To record all accounting transactions for a given period of time in Oracle Projects to facilitate summarizing time-defined costs for review and analysis using the online and reporting functions in Oracle Projects. To complete interfacing all accounting transactions for the period to the other integrated financial systems, such as General Ledger and Accounts Payable. To close the current reporting period and advance to the new period for cost tracking. Closing Cycle Preparation Tasks are: Verify that all preapproved batches are released or approved for the current reporting PA period. For preapproved batches, do a wildcard search from the Preapproved Expenditure Entry window on the status field or expenditure date as appropriate. If Oracle Projects is the direct data source for payroll or for reconciling labor costs to payroll, verify that all time cards are entered or accounted for. Run the AUD: Missing Timecards report. Import all transaction import batches and try to resolve any rejected expenditures from the transaction import file. Run the PRC: Transaction Import process and review exception section. One rejected expenditure item causes an entire expenditure to be rejected. Many cost-based tasks can affect the revenue production processes if you do them during the closing cycle. Most revenue accrual relies on cost distribution being completed before generating project revenue. Before accrual can occur, you must: Interface supplier invoices from Oracle Payables. Distribute labor, usages, and expense reports. Closing Cycle Tasks Once you have verified that all transactions have been accounted for during the closing cycle preparation activities, you should place limits on general transaction processing by users. Creating new or adjusting existing expenditures during the final cost distribution processes may cause reconciliation problems if not controlled (particularly in a geographically dispersed user community). The closing process includes the following tasks, listed in chronological order: Run final cost distribution processes. Optionally, run the PRC: Update Project Summary Amounts process. Generate project allocations. Run final management reports. Interface cost transactions with General Ledger or Accounts Payable. Generate draft revenue for all projects. Distribute Borrowed and Lent Amounts. Can be run earlier if transfer price is not dependent on revenue. Generate draft intercompany invoices and (optionally) provider cost reclassification entries. Interface cross charge distributions to General Ledger. Run final management reports for revenue. Run processing for inter-project billing. Change current PA period status to Pending Close. Open new PA period. Allow new expenditure entry. Adjust expenditures and perform cost distribution processes as necessary. Post Closing Tasks: Post-closing tasks include the following items in chronological order: Update project summary amount. Open access to user maintenance tasks. Interface revenue with General Ledger (for Oracle Project Billing only). Set a new current reporting PA period. Permanently close the old PA period. Note: You can not close the PA period until all transactions have been transferred to the General Ledger. <Course name> <Lesson number> - 24

Closing a PA Period The final step before fully closing the current PA period is to interface revenue with the General Ledger. Run the process PRC: Interface Revenue with General Ledger It is at the discretion of the user when to set the current PA period to the new PA period Closing a PA Period PA periods involve six statuses. The statuses are listed in order of life cycle: Never Opened: No processing Future: Allows new transactions to be entered but not processed Open: Allows all entry and processing activity Pending Close: Same as open but does not allow any new cost distribution lines to be created Closed: Stops all processing (A PA period can be closed only when all cost distribution lines have been interfaced with General or Accounts Payable.) Permanently Closed: Period cannot be reopened <Course name> <Lesson number> - 25

Period-Closing Exception Reports
Use the following period-closing exception reports to identify transactions that have not been processed successfully and that would prevent you from closing the PA period EXC: Summarization Period Exceptions EXC: Transaction Exception Details EXC: Transaction Exception Summary Corrected the exceptions and close the PA period Period-Closing Exception Reports (N) Others > Requests > Run (B) Submit Requests From the Submit Requests window, you can select and submit each of the exception reports. The report is sorted by: PA period Exception category Exception reason If you leave the exception category and exception reason blank, the report lists the total amount and the total number of items. <Course name> <Lesson number> - 26

Period Rates General Ledger uses: Period-average and period-end rates when you translate your actual and budget account balances The revaluation rate when you revalue account balances that are denominated in a foreign currency Period Rates You must define and enable your currencies before you can enter period rates. General Ledger uses the following rates to perform foreign currency translation in accordance with SFAS #52 (U.S.). Period-Average Rate – Used to translate income statement accounts. Period-End Rate – Used to translate balance sheet accounts. Revaluation Rate: General Ledger enters the inverse of the period-end rate as the revaluation rate. Revaluations are performed on accounts that have foreign currency balances at the end of the period to properly state the balances to the current converted functional currency amount. REVALUE <Course name> <Lesson number> - 27

Running Revaluation Revalue Foreign Currency Balances
Post to Unrealized Gain/Loss Account Reverse Revaluation Journals Is the foreign Currency Receivable Still Unpaid? Yes No Collect Foreign Currency Receivable Post to Realized Gain/Loss Account Running Revaluation Prerequisites Before you run revaluation, you should do the following: Define an unrealized gain/loss account. Define a revaluation rate for each currency by period. Revaluation is run at the end of each accounting period as part of the close process to revalue balance sheet accounts that are denominated in a foreign currency in accordance with SFAS 52 (US). The journal is then reversed at the beginning of the next period. The process is repeated until the transactions are settled. The Realized Gain/Loss will be recorded by the appropriate subledger (Accounts Payable or Accounts Receivable) and transferred to the General Ledger at the time the obligation is settled. Revaluation can be run for a single foreign currency, the Euro and EMU currencies (during the transition period), or for All currencies. When you run revaluation, General Ledger creates a revaluation batch containing a separate journal entry for each revalued foreign currency. Note that General Ledger creates the revaluation adjustments in your functional currency. General Ledger automatically defines the reversal period as the next accounting period. <Course name> <Lesson number> - 28

Revaluation Example Entered Journal Entry Lines
DR. Accounts Receivable………………….10,000 Euro CR. Revenue…………………………………………10,000 Euro Convert 1 Euro = .8 US Dollars DR. Accounts Receivable………………….… 8,000 US$ CR. Revenue……………………………………….….. 8,000 US$ REVALUE 1 Euro = .81 US Dollars Revaluation Example At the end of the accounting period, the revaluation process creates an unposted journal to record the change in the converted balances to the Unrealized Gain/Loss Account. The journal is posed, and then reversed at the beginning of the next reporting period. In this example: The original journal entry in Euro remains the same. At period end, the exchange rate has changed to .81. The receivable is still 10,000 Euro, but is now $8,100 US Dollars. The offset of $100 is recorded in the Unrealized Gain account. For more information on Revaluation, see the previous chapter on Multi Currency. DR. Accounts Receivable………………….… 100 US$ CR. Unrealized Gain…………………………………… US$ <Course name> <Lesson number> - 29

Accounting Period Status
Never Opened Future Enterable Open Period Closed Period Accounting Period Status Each accounting period has one of the following five statuses: Never Opened: You cannot enter or post journals. Future Enterable: You can enter journals, but you cannot post. The number of future enterable periods is a fixed number defined in the Ledger window. You can change the number of Future Enterable periods at any time. Open: You can enter and post journals to any open period. An unlimited number of periods can be open, but doing so may slow the posting process. Closed: You must reopen Closed periods before you can post journals. You should manually close periods after finishing your month-end processing. Permanently Closed: Permanently Closed periods cannot be reopened. This status is required to archive and purge data. Permanently Closed Period <Course name> <Lesson number> - 30

Balance Sheet Close Meets global audit and statutory reporting requirements Closes your balance sheet accounts to a specified balance sheet closing account You can automatically reverse this journal at the beginning of the next period Balance Sheet Close When you run Create Balance Sheet Closing Journals, journal entries are created to reverse debits and credits of ending year-to-date actual balances for the period you want to close. The balance, which is the net of the reversed asset and liability accounts, is transferred to the closing account you specify. Before running this program, review the following activities: Create an accounting calendar that includes two adjusting periods: one for the last day of the fiscal year you are closing, and one for the first day of the new fiscal year. This does not affect account balances in periods used for reporting. Post any adjustment entries to the appropriate periods. Print General Ledger accounting and analysis reports. Ensure the period you are closing is an Open period. Run the close process, Create Balance Sheet Closing Journals in the last adjusting period of the fiscal year you want to close. Post the balance sheet closing journals to zero-out balance sheet account balances. Note: Should you need to make adjustments after the balance sheet closing journals are posted, reverse and post the original closing entries, make your adjustments, then rerun the closing process to capture the new adjustments. In the first adjusting period of the new fiscal year, reverse the balance sheet closing journals to repopulate the balance sheet accounts. Post the generated reversing journals. Balance Sheet Closing Journal Attributes: The journal entry that closes the balance sheet has the following attributes: Only actual balance types are closed out. Budget or encumbrance balances are ignored. The effective date of your closing entries is the last day of the period you select in the Parameters window, typically an adjusting period representing the last day of the fiscal year. General Ledger automatically creates a separate closing account for each balancing segment if you specify an account range that includes multiple balancing segments. Closing journals are marked for reversal in the period following the period the closing journals were generated. To change the reversal method default, see Changing The Default Reversal Method, below. General Ledger closes functional currency balances only. Foreign currency balances are ignored. <Course name> <Lesson number> - 31

Income Statement Close
Run Income Statement Close at any time to predetermine the effect of a close, or perform pro-forma reporting Create actual closing entries to meet auditing requirements Close your income statement accounts to the retained earnings account or another account Income Statement Close The Income Statement Closing Journals program generates journals to close out the year-to-date (YTD) actual balances of a range of revenue and expense accounts. This program can be submitted for any open period. The Income Statement Closing Journals program can accept two account templates as parameters for the closing journal. The Retained Earnings account template The Income Statement Offset account template The Retained Earnings account template is a required parameter. The Income Offset account template is an optional parameter. Option 1: Income Statement Close: When you run the process, Create Income Statement Closing Journals, and you enter an account for the field, Closing Account in the Parameters window, entries are posted against each revenue and expense account in the account range processed. It is the reciprocal of the account's YTD balance and zeroes out each account. The amount posted to the retained earnings account is effectively the net sum of the revenue and expense accounts' YTD balances. If there are income statement balances in both functional and foreign currencies, the closing process produces a journal batch that contains separate journals for each currency processed. For the functional currency, the journal will only have entered amounts as converted amounts do not apply. For foreign currencies, the journal will have both entered and converted amounts. Stat account balances are not processed by the program. Option 2: Income Statement Offset: When you run the process, Create Income Statement Closing Journals, and you enter an account for the fields, Closing Account and Income Offset Account in the Parameters window, the journal generated will be similar to that described above except for the following: The revenue and expense accounts included in the specified account range will not be zeroed out. Instead, the program will take the net sum of the revenue and expense accounts. This sum includes the balance in the income statement offset account. It will then post the reciprocal of the net sum to the income offset account, in the appropriate debit (DR) or credit (CR) column. The amount posted to the retained earnings account will be the reciprocal of the amount posted to the income offset account. This retained earnings amount will then also be equal to the net sum of the revenue and expense accounts processed. <Course name> <Lesson number> - 32

Historical Rates Historical Rates are: Weighted average rate for transactions that occur at different times Used to report journal entry line amounts in the units of money that were current when the transactions took place Historical Rates Historical rates are: More precise than pre-owned rates with respect to equity accounts. Defined before running translation to avoid having to retranslate your balances. Can stabilize the translate balances by defining fixed historical rates for long-term accounts. Used with highly inflationary currencies to remeasure specific historical account balances in accordance with U.S. FASB 8. TRANSLATE <Course name> <Lesson number> - 33

Foreign Currency Translation
Functional Balance Sheet Assets Liabilities Functional currency 100,000 60,000 Period end Rate = 0.75 Owner's Equity Period end Rate = 0.75 40,000 Foreign Balance Sheet Foreign currency Assets Liabilities 75,000 45,000 Historical Rate = 0.70 Foreign Currency Translation Foreign currency translation lets you restate your functional currency account balances into a reporting currency. Translate actual and budget balances from functional currency to foreign currencies for online inquiries, reports, and consolidations. If you have average balance processing enabled, you can translate average balances as well as standard balances. If you want to report financial results in Euro, you can use General Ledger's translation feature to translate your account balances from your functional currency to Euro. Run translation after you have completed all journal activity for an accounting period. If you post additional journal entries or change your translation rates after running translation for a period, you must retranslate. Note: Additionally, if you change the account type for an account segment value and want to retranslate your actual account balances, you must reenter or change the period-end and average exchange rates for the periods that you want to retranslate. Owner's Equity 28,000 <Course name> <Lesson number> - 34

Overview of Consolidations
With Oracle General Ledger, you can consolidate any number of subsidiaries that use different ledgers Subsidiary 1 Subsidiary 2 Subsidiary 3 Run Consolidation Parent Overview of Consolidations The consolidation process combines the financial results of different companies, typically combining subsidiary accounting information into a parent company for reporting purposes. You can use the method that best suits your needs to consolidate financial information. Financial Statement Generator (FSG): Use to consolidate financial information for businesses using a single ledger or businesses using different ledgers that share the same calendar and chart of accounts. Use recurring journals, mass allocation journals, and standard journals to create intercompany elimination journal entries for multiple companies sharing the same ledger. Global Consolidation System (GCS): Use to consolidate financial information for multiple ledgers, diverse financial systems, and geographic locations, including both Oracle and non-Oracle applications. Use the Consolidation Workbench in GCS to: Access windows used to perform each consolidation activity Monitor the status of your consolidation View history of past consolidations <Course name> <Lesson number> - 35

Global Consolidation System (GCS) Features and Benefits
Global Consolidation System provides: A workbench to view the consolidation status Sophisticated consolidation mapping rules A color-coded consolidation monitor that guides you through the consolidation steps A Consolidation Hierarchy Viewer to graphically display your consolidation structure Automatic generation of eliminating entries Multilevel drilldown capabilities to subsidiary balances Powerful report publishing capabilities using FSG Global Consolidation System (GCS) Features and Benefits Consolidation Workbench: View the status of your consolidation and monitor subsidiary account balances for any changes that occur after the subsidiary data has been transferred. Mapping Rules: Determine how your subsidiary account balances roll up into the parent. State Controller: Access to every form you need for consolidations and guides you through the consolidation process. Consolidation Hierarchy Viewer: View the multilevel structure of your consolidation mapping in a graphical format to see relationships and analyze ledger information. Automatic Elimination Entries: Automatically generate journal entries to eliminate intercompany balances based on rules you define. Multilevel Drilldown: Drill down to access account balances, journal entries, and subledger transactions. Reporting: Generate standard or custom reports that can be published to a text file, spreadsheet, or web site for review and analysis. Integrated Analysis: Perform multidimensional analysis of consolidated financial data using Oracle Enterprise Planning and Budgeting. Oracle Enterprise Planning and Budgeting is tightly integrated with Oracle General Ledger. After consolidating your companies' information, you can analyze the data using multiple scenarios. <Course name> <Lesson number> - 36

Consolidating Ledgers
Subsidiary ledgers Consolidation journal Run consolidation Run journal import Post consolidation batch GL_INTERFACE table Parent ledger Consolidating Ledgers After defining a consolidation to map accounting information from a subsidiary ledger into a parent ledger, you must run the consolidation to generate the consolidated information. When a consolidation is run, Oracle General Ledger submits a concurrent process that populates the GL_INTERFACE table with consolidation data. You must run Journal Import to create an unposted consolidation journal batch in your parent ledger, either at the time you run consolidation or later using the Import Journals window. For more information on Consolidation, see the previous chapter on Consolidations. <Course name> <Lesson number> - 37

Reporting Options Reporting Web Function OI Std FSG ADI EPB BIS Disc RXi Review Balances P P P P P P P P Summary/detail P P P - P - Journals P P P - P - Subledger P Preseeded P P - P Create Financials P P P - Create Report Sets P P P Auto Schedule P P P P Publish to web P P - Query live data P P P P P - Snapshot P P - P Reporting Options Reporting Function Legend OI - Online Inquiry Std - Standard Reporting FSG - Financial Statement Generator Web ADI - Web Applications Desktop Integrator EPB - Oracle Enterprise Planning and Budgeting BIS - Business Intelligence System Disc - Discoverer RXi - RXi Report Administration Tool <Course name> <Lesson number> - 38

Performing Account Inquiry
(B) Show Balances (B) Show Journal Details (B) Show Variance Detail Balances Journals (Inquire) Variance Journals Performing Account Inquiry (N) Inquiry > Account Use the account inquiry feature to view actual, budget, and encumbrance account balances for a specific period or periods in either entered or balance level reporting currencies. You can select one of three buttons to access the type of account information you want to view: Show Balances: Displays PTD and YTD account balances by period for both detail and summary accounts. Show Journal Details: Lists all the journal batches and entries that affect the account balance. From here you can drill down to the full journal entry and subledger transaction. Show Variance: Displays actual vs. budget or encumbrance amounts and the variance for PTD, QTD, YTD, and PJTD (project-to-date) time periods. Note: The Account Inquiry window displays balances from posted journal entries. To get the most up-to-date account balance information, be sure all journal entries are posted. Summary Balances <Course name> <Lesson number> - 39

Helpful Closing Reports
Consolidation Exceptions Reports: Unmapped Subsidiary Report Disabled Parent Accounts Report Consolidations Rules Report Consolidations Audit Report Trial Balance Reports: Detail Summary Translation Request Sets Helpful Closing Reports Select the Report button on the State Controller to submit standard consolidation reports or (N) Others > Reports > Run (B) Submit Requests Consolidation Audit Report: Use this report to review the mapping of account balances from your subsidiary ledger into accounts in your parent ledger for a specific consolidation mapping. It reports the total of all subsidiary account balances that were consolidated into each account in your parent ledger. Consolidation Exception Reports: Unmapped Subsidiary Report: Use this report to determine if your consolidation is complete prior to posting. It reports any subsidiary accounts, included in the account range you specified for your consolidation transfer, with non-zero balances that were not consolidated into your parent ledger because the accounts were not mapped. Disabled Parent Account Report: Use this report to review all disabled accounts in your parent ledger for which you tried to consolidate balances or transactions. Consolidation Rules Report: This report prints the segment and account rules defined for a specific consolidation mapping. Consolidation Journals Report: This report lists subsidiary journal lines and the parent accounts used for your consolidation. Use this report to review journal batches consolidated across multiple ledgers. Note: The Consolidation Audit Report, Unmapped Subsidiary Report, and Disabled Parent Account Report are available only if you select the audit mode run option when transferring your subsidiary data. Select (N) Others > Reports > Run (B) Submit Requests to run standard trial balance reports: Detail Trial Balance Report: Review your general ledger actual account balances and activity in detail. You can run this report for balances and activity entered in your functional currency or STAT, or translated to a foreign currency. The report prints a line for each of your accounts and lists them in ascending order by account segment value. For each account, the report prints the account segment value, account segment value description, beginning balance, period activity, and ending balance for the period you specify. General Ledger reports debits as positive amounts and credits as negative amounts. Summary Trial Balance Report: Review general ledger actual account balances and activity summarized by account segment value. You can run this report for balances and activity entered in your functional currency or STAT, or translated to a foreign currency. The report prints a line for each account segment value and lists them in ascending order. For each account segment value, the report prints the value, description, beginning balance, net of all debit or credit transactions, and ending balance for the period you request. Translation Trial Balance Report: Review your account balances and period activity after running translation. General Ledger prints a separate page, including totals, for each balancing segment value, listing accounts in ascending order by account segment value. For each translated account, the report prints the description of the account segment value, account type, beginning balance, debits and credits, rate adjustment, and ending balance. Standard Reports <Course name> <Lesson number> - 40

Summary In this lesson, you should have learned how to: Explain the accounting cycle Identify steps in the close process Perform journal import of subledger balances Reconcile to the subledgers Run revaluation Close the period Consolidate account balances Inquire and run reports on final balances <Course name> <Lesson number> - 41

R12 General Ledger Management Fundamentals

Similar presentations

Presentation on theme: "R12 General Ledger Management Fundamentals"— Presentation transcript:

Similar presentations

About project

Feedback

Log in

Auth with social network:

R12 General Ledger Management Fundamentals

Similar presentations

Presentation on theme: "R12 General Ledger Management Fundamentals"— Presentation transcript:

Similar presentations

About project

Feedback