2. The following is intended to outline our general product direction
The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions. The development, release, and timing of any features or functionality described for Oracle’s products remains at the sole discretion of Oracle.

3. E-Business Suite R12 Cost Accounting Integrated with SLA
Diane Streubel – Schreiber Foods Cost Manager
Douglas Volz – OAUG Discrete Cost SIG Sub-Committee
Herve Yu – Oracle Costing Development

4. Costing Accounting Integrated with SLA Agenda
Oracle Process Costing MAC transitioning to SLA
Oracle Discrete Costing SLA enhancements
Case example: Discrete Costing-Product Line Accounting

5. <Insert Picture Here>
Schreiber Foods
Diane Streubel
Manager - Cost & System Development
Oracle Process Costing
MAC transitioning
to SLA

6. Costing Accounting Integrated with SLA OPM MAC transitioning to SLA
Converged inventory model
Inventory Organizations that are Process will use Process Costing
Process users are denied access to Discrete Costing forms
Process Enabled organizations can not setup costs in the Discrete Costing application
Sub Ledger Architecture (SLA) replaces MAC

7. Costing Accounting Integrated with SLA OPM MAC transitioning to SLA
11i OPM
GMI
(OPM Inventory)
Order Management
Purchasing
GMD, GME
Cost Setup
Calculate Cost
Store Costs
Oracle GL
MAC

8. Costing Accounting Integrated with SLA OPM MAC transitioning to SLA
R12 OPM
Oracle Inventory
Order Management
Purchasing
GMD, GME
Cost Setup
Calculate Cost
Store Costs
Oracle GL
SLA

9. Costing Accounting Integrated with SLA OPM MAC transitioning to SLA
Subledger accounting is an intermediate step between subledger products and the Oracle General Ledger
Each transaction that requires accounting is represented by a complete and balanced subledger journal entry, stored in a common data model.

10. Costing Accounting Integrated with SLA OPM MAC transitioning to SLA
11i OPM
General Ledger
I n t e r f a c e
Subledger
GL Export
Journal Import
Journal Posting
For G/L integration, discrete costing works the same as OPM costing

11. Oracle Subledger Accounting
Costing Accounting Integrated with SLA OPM MAC transitioning to SLA
OPM
R12 OPM
Payables
Receivables
Oracle Subledger Accounting
Oracle General Ledger
Projects
For G/L integration, discrete costing works the same as OPM costing

12. Cost Pre-processor will create accounting Events
Costing Accounting Integrated with SLA OPM MAC transitioning to SLA
OPM MAC
SLA
Completed material
and/or resource
transactions.
Completed material
and/or resource
transactions.
OPM Costing Engine
generates costs.
OPM Costing Engine
generates costs.
Cost Pre-processor will create accounting Events
OPM Subledger process processes these transactions to create Journal entries
SLA accounting program processes the events to create the journal entries

13. Costing Accounting Integrated with SLA OPM MAC transitioning to SLA – Setup Forms
COMMENTS
Fiscal Policy
Retained with few modifications
Event Fiscal Policy
Source
Process Category
Event
Event Entity
Sub-Event
Event Class
Account Titles
Journal Line Types (JLT)
Accounting Template
Application Accounting Definitions (AAD)
Users can define their own AADs or modify seeded information
Account Mapping Attributes
(SLA) Sources
SLA sources are used in ADRs
Priorities and Account Mapping
Account Derivation Rules (ADR)
More flexible. Mapping can be done at Accounting flexfield level as well as segment level
Test Mapping
Test Accounting Builder (TAB)
OPM Currency, OPM Ledger, OPM Exchange Rates
Use GL setups

14. Costing Accounting Integrated with SLA OPM MAC transitioning to SLA - Reports
COMMENTS
Test and Actual Subledger Accounting
Draft and Final Accounting
Subledger Program
Accounting Pre-Processor
Run Subledger for multiple valuation/cost methods for a ledger
Supports multiple valuation methods
In OPM there can only be one representation at a time. SLA supports multiple representations at the same time
Run Subledger process for a functional area
Run Pre-Processor by Process Category
Flexible. User can have any number of categories. Assigned to one or more event classes
Detailed Subledger Report
Is retained and has been modified to use SLA repository

15. Costing Accounting Integrated with SLA OPM MAC transitioning to SLA
Most of the steps are automated using migration scripts
All the Account Definitions would be migrated as ADRs
Manual 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. Costing Accounting Integrated with SLA OPM MAC transitioning to SLA - Process

17. Costing Accounting Integrated with SLA OPM MAC transitioning to SLA - Summary
NO LOSS of functionality by moving to SLA model
A new sub-menu created under Cost Management for SLA forms.
Fiscal Policy and Event Fiscal Policy screens retained with minor modifications. Most of the fields will be read-only.
OPM Event model mapped to SLA event model.

18. <Insert Picture Here>
OAUG Discrete Cost SIG Sub-Committee
Douglas Volz
Douglas Volz Consulting, Inc.
Oracle Discrete Costing SLA
Enhancements

19. Costing Accounting Integrated with SLA Increased Flexibility: Oracle Discrete Costing SLA
Release 11i account recognition “pain points” eliminated by SLA:
SLA removes limitations for recording COGS and Revenue (still uses Cost Account Generator/workflow and A/R AutoAccounting)
Recording inventory and WIP accounts with more flexibility
Flexible variance account recognition for:
Invoice price variance
Purchase price variance
Average cost adjustment
Standard cost adjustment
Manufacturing variances
Account aliases
Freight charges
And most other inventory, manufacturing and related account entries

20. Sub Ledger Accounting(SLA) Key Concepts
Event Model: definition of the subledger transaction types and
lifecycle
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 Transaction, Receiving or WIP or Write Off
EVENT CLASS
Logical grouping of events which have similar kind of accounting
The most granular level of business event which has accounting impact
EVENT TYPE

21. Sub Ledger Accounting(SLA) Setup and Process
JOURNAL ENTRY SETUPS
Enter Transaction(s)
Define/copy and modify journal line types
Cost Manager
Define/copy and modify account derivation rules
Create Accounting*
Transfer Journal Entries to GL
Define/copy and modify descriptions
*Run ‘Create Accounting – Cost Management’ concurrent request for accounting all transactions from the Cost Management – SLA responsibility.
Receiving Accounting can be generated in the Purchasing responsibilities using the ‘Create Accounting – Receiving’ concurrent request.
These requests have an option to transfer the entries created to General Ledger. A separate process is also available.

22. Sub Ledger Accounting(SLA) Setup and Process
Transactions
Accounting Events
Cost Management
SLA
Accounting
Configurations
Subledger
Balances
Journal Entries GL
Journal Entries
and Balances
Accounting
Program
Journal Entry Setup

23. <Insert Picture Here>
Oracle Corporation - Discrete Costing Development
Herve Yu
Senior Principal Engineer
Case Example: Discrete Costing-Product Line Accounting

24. Costing Accounting Integrated with SLA Case Example: Purchase Price Variance product Line
Example: Record Purchase Price Variance by Product Line
We have 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 same requirement
Cost/SLA mapping set capability
Category Accounting – Cost/Global Accounting migrated to SLA in R12.1
A word for Inventory period close and Cost/SLA upgrade

25. Cost/SLA mapping set capability

26. Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
Product Line Setup Steps Set up your product line using SLA mapping set
Enter your SLA account derivation rule for Purchase Price Variance accounts
Associate the new account derivation rule to your Journal Line Type
Associate the Application Accounting Definition with Subledger Accounting Method

27. Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
Product Line Accounting – Descriptive flexfield

28. Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
Product Line Accounting – Descriptive flexfield

29. Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
Mapping set – Account Derivation Rule

30. Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
Mapping set – Account Derivation Rule

31. Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
SLA Journal Line / Derivation Rule

32. Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
Associate Journal Lines Definition to the Event Class

33. Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
Note the same ADR is usable for Standard Cost Update

34. Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
Note the same ADR is usable for Standard Cost Update

35. Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
Associate SLA Definition to the SLA Method/Ledger

36. Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
Assign product line code to the inventory item

37. Matl Overhead Absorption
Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
The material subledger from 11i still exists
Inventory
Inventory
Receiving
Matl Overhead Absorption
PPV

38. Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
SLA Entries That Go to Your G/L

39. Costing Accounting Integrated with SLA Cost/SLA mapping set capability:PPV by product Line
For the Standard Cost Update That Go to Your G/L

40. Category Accounting – Cost/Global Accounting migrated to SLA in R12.1

41. Costing Accounting Integrated with SLA Product Line Category Accounting:Global Accounting
Create a new structure under the key flexfield “Item Category”

42. Costing Accounting Integrated with SLA Product Line Category Accounting:Global Accounting
Create a new structure under the key flexfield “Item Category”
Create category codes

43. Costing Accounting Integrated with SLA Product Line Category Accounting:Global Accounting
Create a new structure under the key flexfield “Item Category”
Create category codes
Create category set

44. Costing Accounting Integrated with SLA Product Line Category Accounting:Global Accounting
Create a new structure under the key flexfield “Item Category”
Create category codes
Create category set
Assign “Product Line Accounting” functional area category set

45. Costing Accounting Integrated with SLA Product Line Category Accounting:Global Accounting

46. Costing Accounting Integrated with SLA Product Line Category Accounting:Global Accounting
Account Derivation Rule would have used a source directly

47. Costing Accounting Integrated with SLA Case Example - Conclusion
Summary Notes
Product line accounting can be achieved in many ways without using Costing Hook.
In R12 SLA is the Oracle R12 accounting platform and Costing supplies application sources from INV,WIP,RCV… to build the accounting journals.
One caveat: Pre-Release 12 subledger accounting reports are reading data from Costing distribution layer (such as the Material Account Distribution Summary or Detail Reports). Those reports will not show SLA journals. SLA provides a set of new accounting reports (such as Journal Entries Report, Accounting Analysis Report…) which can be modified as desire using BI Publisher.

48. Costing Accounting Integrated with SLA Inventory Period Close and Upgrade
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.

49. Costing Accounting Integrated with SLA
Additional information are available:
R12 Oracle Subledger Accounting – Implementation Guide
R12 Oracle Cost Management – User Guide
R12 Oracle Process Manufacturing Cost Management - User Guide

50. THANK YOU