1. Oracle Subledger Accounting
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Oracle Subledger Accounting
Oracle Subledger Accounting

2. Oracle Subledger Accounting 7 - 2
Objectives
After completing this lesson, you should be able to:
Define custom sources.
Set up business flows.
Use multiperiod accounting.
Determine how and when accrual reversals are performed.
Set up third party control accounts.
Set up alternative accounts.
Use the diagnostic framework to review the transaction data used by the accounting program when generating a journal entry.
View errors.
Sequence journal entries.
Oracle Subledger Accounting

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Custom Sources
Define custom sources using seeded sources and constant values when sources required for the definition of accounting rules are not available.
Seeded Sources
Custom Sources
Custom Sources
Use standard and system source values as parameters to write PL/SQL functions that create custom sources.
Mapped to specific Subledger Accounting accounting attributes such as account, amount, GL Date, and conversion rate type.
Custom sources are defined in the Custom Sources window.
Constant Values
Oracle Subledger Accounting

4. Defining Custom Sources
Custom sources are used to extend the list of sources available for use in Application Accounting Definitions.
Before defining a custom source, you must understand the need for a custom source and must have analyzed other alternatives, this is because custom sources may impact the performance of the Create Accounting program.
Oracle Subledger Accounting

5. Custom Source Definition
Defining Custom Sources
Navigation Paths:
Payables: Setup > Accounting Setups> Subledger Accounting Setup > Accounting Methods Builder > Sources > Custom Sources
Receivables: Setup > Accounting > Accounting Methods Builder > Sources > Custom Sources
Note: You should only use custom sources as a last resort since there may be an impact on performance. If you need a custom source to produce something that is already in an EBS table, you should log an enhancement request to get it added as a standard source.
To define a custom source:
Write the corresponding PL/SQL code. This will be a function that returns the value of the custom source.
Create the package in the database.
Define the custom source. In the definition of the customer source you will assign the PL/SQL function previously defined and you will list the sources that are used as input parameters to the function.
Use the custom source in any component of the Application Accounting Definition. The source is available in all the lists of values that show sources and the source type is Custom.
Oracle Subledger Accounting

6. Example: Custom Source in a Description
PL/SQL function used for the custom source:
CREATE OR REPLACE FUNCTION calculated_amount
(AID_AMOUNT IN NUMBER,
AID_AMT_WITHHELD IN NUMBER)
RETURN NUMBER IS
-- Calculates the invoice amount minus the withheld amount
l_amount NUMBER;
BEGIN
l_amount := AID_AMOUNT - AID_AMT_WITHHELD;
RETURN l_amount;
END;
Oracle Subledger Accounting

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Business Flows
Use business flows to establish a link between the accounting of transactions that are related both within the same application and across applications. With this link, you can preserve key accounting information across related transactions instead of using the same set of rules to derive this information.
Business
Flows
Transaction
Business Flows
The purpose of business flows is to:
Preserve General Ledger accounts or segment values across journal entries of related transactions within a business flow.
Ensure proper General Ledger balances.
Related Transactions Example
When goods are received, an invoice is entered and the invoice is paid. The business flow at the transaction level is:
The receiving transaction is entered to acknowledge the arrival of the goods.
The invoice is entered to acknowledge that the supplier is owed for the goods and therefore references the receipt transaction.
The payment is created to satisfy the amount owed on the invoice and therefore references the invoice.
The business flow at the accounting level is:
The receipt generates an entry to the purchase order charge account.
This entry is offset by an accrual entry representing a future invoice liability.
The invoice reverses this accrual entry and creates the invoice liability, and the accounting for the payment reverses the invoice liability and generates the entry reducing the company’s cash account.
Oracle Subledger Accounting

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Business Flows
Business Flows
Enabling business flows requires that the linking sources from the original transaction are available to the new one.
Oracle Subledger Accounting

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Business Flow Methods
The business flow method specifies how a journal line obtains certain journal entry values including accounting attributes for a journal entry.
A business flow method is assigned to a journal line type in the Journal Line Types window.
Journal line
Journal
Entry
values
Business
Flow
Attributes
Business Flow Methods
Business flows are set up in the following windows:
Journal Line Types
Navigation path in Payables: Setup > Accounting Setups> Subledger Accounting Setup > Accounting Methods Builder > Journal Entry Setups > Journal Line Types
Navigation path in Receivables: Setup > Accounting > Accounting Methods Builder > Journal Entry Setups > Journal Line Types
Journal Lines Accounting Attribute Assignments
Navigation path in Payables: Setup > Accounting Setups> Subledger Accounting Setup > Accounting Methods Builder > Journal Entry Setups > Journal Line Types (B) Accounting Attribute Assignments
Navigation path in Receivables: Setup > Accounting > Accounting Methods Builder > Journal Entry Setups > Journal Line Types (B) Accounting Attribute Assignments
Journal Lines Definitions
Navigation path in Payables: Setup > Accounting Setups> Subledger Accounting Setup > Methods and Definitions > Journal Lines Definitions
Navigation path in Receivables: Setup > Accounting > Methods and Definitions > Journal Lines Definitions
In the Journal Lines Types window, set up the following:
Assign a business flow class to a journal line type
Select a business flows method
The Journal Lines Accounting Attribute Assignments window displays all accounting attributes assigned to an event class. If the Inherit check box is enabled, the values for the selected attributes are inherited and are not available for update or entry.
In the Journal Lines Definitions window, set up the following:
Assign a journal line type to a journal lines definition.
For Same Entry and Prior Entry, indicate that the journal lines definition inherits the journal entry description for the journal line type.
For the Same Entry and None business flows method, assign account derivation rules.
For the Same Entry and None business flows method, optionally inherit accounting segment values.
Business Flow Class
The business flow class is a user-defined lookup that can be assigned to a journal line type and used by more than one application.
The Subledger Accounting program uses the business flow class to identify the journal entry line in the initial stage of the business flow from which current journal entries copy certain journal entry values.
Oracle Subledger Accounting

10. Multiperiod Accounting
Multiperiod accounting enables you to create accounting for a single accounting event for more than one GL period. The functionality is primarily used to recognize revenue or a prepaid expense or revenue across multiple GL periods.
GL periods
Users
Multiperiod Accounting
Multiperiod accounting is set up in the Journal Line Accounting Attributes Assignment window.
Navigation paths:
Payables: Setup > Accounting Setups> Subledger Accounting Setup > Accounting Methods Builder > Journal Entry Setups > Journal Line Types (B) Accounting Attribute Assignments
Receivables: Setup > Accounting > Accounting Methods Builder > Journal Entry Setups > Journal Line Types (B) Accounting Attribute Assignments
Oracle Subledger Accounting

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Accrual Reversals
Use Accrual Reversal to define…
How accrual reversals are automatically performed
When accrual reversals are automatically performed
Accrual Reversals
Accrual reversals are done automatically by running the complete Multiperiod Accounting program.
Oracle Subledger Accounting

12. Third Party Control Accounts
Certain accounts can be identified as control accounts for customers, suppliers, or both. In this case:
You cannot enter manual adjustments against these accounts in General Ledger.
Subledger Accounting maintains balances for these accounts by third party.
This typically only applies to balance sheet accounts.
Oracle Subledger Accounting

13. Third Party Control Accounts
Oracle Subledger Accounting

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Alternative Accounts
When you disable an account in General Ledger, you can specify an alternative account.
Subledger Accounting and General Ledger use the alternative account when generating a journal entry using the disabled account.
Oracle Subledger Accounting

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Alternative Accounts
Oracle Subledger Accounting

16. Diagnostic Framework Overview
The diagnostic framework provides features to review the transaction data used by the accounting program when generating a journal entry.
Diagnostic Framework Overview
The diagnostic framework provides the input data used for each transaction, such as the following:
Transaction objects
Ledger information
System sources
Source values
The following examples describe typical uses of the diagnostic framework features:
In the implementation phase, users can launch the Transaction Objects Diagnostic report to review the source values available in the transaction objects.
On a daily basis, users can use the Transaction Objects Diagnostic report to analyze issues related to the generation of subledger journal entries.
Oracle Subledger Accounting

17. Diagnostic Framework Business Process
Accounting Program
Diagnostic Extract
Diagnostic tables
Transaction
Objects
Diagnostic Framework Business Process
The administrator sets the SLA: Enable Diagnostics profile option to Yes for the user or responsibility.
Users submit the Create Accounting program which automatically executes the diagnostic framework to populate the diagnostic tables. 
The diagnostic framework gathers source values and other information from the transaction objects.
Users submit the Transaction Objects Diagnostics concurrent request to view the diagnostic report.
The administrator submits the Purge Transaction Objects Diagnostics concurrent request to purge the results of the diagnostic framework.
Journal Entries
HTML report
Oracle Subledger Accounting

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Error Handling
If the accounting program cannot generate a journal entry due to an error, it completes with a warning status.
The accounting program generates an execution report detailing any errors.
To avoid errors, keep in mind:
Accounting rules are pre-validated
When you disable an account, you can specify a replacement account.
Accounting program > Generates report
Oracle Subledger Accounting

19. Journal Entry Sequencing
Journal entries in General Ledger and Subledger Accounting can be assigned sequence numbers
Accounting Sequence: Assigned at time of Subledger Accounting entry completion or General Ledger posting
Reporting Sequence: Assigned at time of period close
Journal Entry Sequencing
Accounting sequence
The accounting sequence is assigned to Subledger Accounting journal entries at the time that the journal entry is completed. The sequence is assigned in the completion date order using the GL date as the date criterion for determining the sequence to be used.
Accounting sequence is optional.
Reporting sequence
The reporting sequence is assigned to both Subledger Accounting journal entries and General Ledger journal entries when the General Ledger period is closed. This sequence is used by most of the legal reports required in some countries as the main sorting criterion to display the journal entries.
Note: In some related documents, this sequence is referred to as the chronological sequence.
These two sequences are not mutually exclusive and can coexist in the same journal entry.
In some cases, the completed journal entries can be functionally correct but the sequence numbers assigned to them are wrong. For example, the user realizes that the sequencing setup is not correct and wants to resequence all the journal entries that are sequenced based on the wrong setup. Subledger Accounting provides an undo and redo accounting feature to correct the original accounting. A key component of this feature is the re-sequencing of journal entries.
Reporting sequence is optional.
Oracle Subledger Accounting

20. Journal Entry Sequencing
Oracle Subledger Accounting

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Summary
After completing this lesson, you should be able to:
Define custom sources.
Set up business flows.
Use multiperiod accounting.
Determine how and when accrual reversals are performed.
Set up third party control accounts.
Set up alternative accounts.
Use the diagnostic framework to review the transaction data used by the accounting program when generating a journal entry.
View errors.
Sequence journal entries.
Oracle Subledger Accounting