Atlanta - OAUG November 21, 2003 Presenters:

Create Overhead Cost Pools Through Oracle’s MassBudgets & AutoAllocations
Atlanta - OAUG November 21, 2003 Presenters: Michael Anenen & Paul Kraskiewicz

Presentation Agenda Assess & Design
Overhead Allocation Methods Standard Cost Overhead Sub-elements Oracle’s Overhead Application Basis Types Cost Pool Allocation Process Using Oracle’s MassBudgets & AutoAllocations Questions & Answers

Start with the End in Mind
Assess & Design Start with the End in Mind Determine your Allocation Method Traditional Activity-Base Costing Overhead Sub-Elements Material Overhead Resource / Department Overhead First Things First – Start with the end in mind 1. Which Allocation Method to use? 2. What Overhead Sub-Elements are required?

Assess & Design Determine your Allocation Method Overhead Sub-Elements
Traditional Activity-Base Costing Overhead Sub-Elements Material Overhead Resource / Department Overhead

Overhead Allocation Methods
Basic Principals Estimate overhead costs for the coming year Estimate activity for the coming year Calculate application rate as Estimated Overhead Costs / Estimated Activity Apply overhead using actual activity and the application rate. If actual overhead > applied overhead, the difference is under-applied. Under-applied overhead reduces income

Traditional Single Plant-Wide Rate Single Rate Per Department Activity-Based Costing Multiple Activity Based Rates Per Department

Traditional Allocation All overhead costs are applied using the same rate. Activity is measured with a single concept, such as: Direct labor hours Direct labor dollars Machine hours Advantages: Simple Arithmetic Easy to understand Disadvantages: Little relationship between costs and activities Can lead to poor business decisions

Activity Based Allocation Overhead costs are divided into cost pools. Each cost pool has its own activity measure (cost driver). Number of purchase orders Number of setups Advantages: Closer causal links between costs and activity Better cost allocations Disadvantages: Complex calculations High start-up costs

APPLICABILITY OF OVERHEAD ALLOCATION METHODS
Method of Assigning Overhead Type of Allocations Number of Stages Basis of Overhead Rates When Applicable Single Plant Wide Rate From a single aggregated cost pool, to products A production volume related activity measure, e.g., direct labor hours or dollars, machine hours, etc. Plant produces only one, or a few similar products that consume all indirect resources in the same proportions, e.g., Product X consumes 10% of each indirect resource in the plant.

Method of Assigning Overhead Type of Allocations Number of Stages Basis of Overhead Rates When Applicable Single Rate Per Department From service departments, to producing departments' single cost pools (overhead accounts), to products A production volume related activity measure. These may be different for each department Each department produces only one, or a few similar products that consume all of a department's indirect resources in the same proportions, e.g., Product X consumes 20% of all indirect resources in Department A, 10% of all indirect resources in Department B, etc.

Method of Assigning Overhead Type of Allocations Number of Stages Basis of Overhead Rates When Applicable Multiple Activity Based Rates Per Department From service departments, to producing departments' activity cost pools, to products Both production volume related and non-production volume related activity measures, e.g., number of purchase orders, number of setups, etc. Each department produces many products that consume resources within each department in different proportions, e.g., Product X consumes 30% of the power, 15% of the engineering work and 20% of the repair in Department A. Multiple rates are needed in Department A.

Assess & Design Determine your Allocation Method
Traditional Activity-Base Costing Oracle Overhead Sub-Elements Material Overhead Overhead

Oracle’s Cost Elements
Material Overhead Material Resource Overhead There are five predefined cost elements. The number available for use depends on whether you use Oracle Inventory only or also Oracle Bills of Material. Available with Oracle Bills of Material used in Standard costing. Average costing. Available with Oracle Inventory – Material and Material Overhead only Resource Outside processing

Oracle Cost Elements Material Overhead & Overhead
Overhead (Resource): This is the overhead cost of resource and outside processing. Overhead is used as a means to allocate indirect production costs. Material Overhead: This is the overhead cost of material, calculated as a percentage of the material cost or as a fixed charge per item, lot, or activity.

Overhead Sub-Elements
Material overhead Resource overhead Material Mgmt Facility Freight-In Benefits Production Control Indirect MFG Engn’g Overhead Cost Elements Overhead Cost Sub-Elements Subelements are a smaller classification of the cost elements. Multiple subelements give you greater item cost visibility and flexibility. Delineate cost subelements so that you can analyze performance in terms of labor, overhead, material, or other direct costs.

Oracle Application Basis Types
Activity: Directly associate the activity cost with the item. Item: Assign a fixed cost per item. Lot: Assign a lot charge to items and operations. Resource units: Charge overhead by multiplying the overhead amount by the number of resource units earned in the routing operation. Resource value: Charge overhead by multiplying the overhead rate by the resource value earned in the routing operation. Total value: Charge overhead by multiplying the total cost of the item by the material overhead rate. Overhead Subelements: Fixed Basis Types for Move-Based (Fixed) Overheads For Item basis, the overhead amount is charged for each item moved out of an operation. Overhead amount charged to WIP = Overhead amount * Number of items moved out of operation Example: Item basis, overhead amount: 15.00, items moved: 100 Overhead amount charged to WIP = * 100 = 1,500.00 2.For Lot basis, the overhead amount is charged when the first item is moved into the operation. Overhead amount charged to WIP = Overhead amount * 1 lot Example: Lot basis, overhead amount: 15.00, items moved: 100 Overhead amount charged to WIP = * 1 = 15.00 Overhead Subelements: Variable Basis Types for Resource-Based (Variable) Overheads Use the Resource Value or Resource Units basis types for resource-based overheads. 1.For Resource Value basis, the overhead rate is multiplied by the resource value earned in the operation. Overhead amount charged to WIP = Overhead rate * Resource value Example: Resource value basis, overhead rate: 1.50, resource value: 50.00 Overhead amount charged to WIP = 1.50 x = 75.00 2. For Resource Units basis, the overhead amount is multiplied by the number of resource units earned in the operation. Overhead amount charged to WIP = Overhead amount * Resource units Example: Resource units basis, overhead amount: 15.00, resource units: 2 Overhead amount charged to WIP = x 2 = 30.00 Fixed Resource You can enter a fixed resource cost in two ways. Enter a fixed charge on the routing operation. Use this method when the resource cost varies by item. Enter a fixed charge for the resource unit cost. Use this method when the resource cost is always the same, regardless of the item.

Overhead Application Basis Type (Example)
Material Overhead Prod. Control Activity: Planning Process Facility: Resource Value Freight-In: Total Value (Buy Items) Benefits: Mat’l Mgmt: PO Process Resource Overhead Indirect: MFG Engn’g: Resource Units Overhead Cost Elements Overhead Cost Sub-Elements And Application Basis Types Note: Only Material Overhead can have an ACTIVITY assigned Cost Allocation Basis: Associate each subelement with a basis type that is used to determine the subelement cost per item. Item: You use the Item basis type to assign a fixed cost per item. For material and material overhead subelements, you define a fixed amount per item. For resource, outside processing, and overhead subelements, you define a fixed amount per item moved through an operation. Lot: You use the Lot basis type to assign a lot charge per item or operation. For material and material overhead subelements, the cost per item is calculated within each cost type as follows: Cost per item = Rate or amount / Item’s costing lot size For resource, outside processing, and overhead subelements, the cost per item is calculated within each cost type as follows: Cost per item = Routing usage * Rate or amount * 1 / Item’s costing lot size Resource Units You use the Resource Units basis type to allocate overhead to an item based on the number of resource units. For material overhead and overhead subelements, the cost per item is calculated within each cost type as follows: Cost per item = Overhead rate * No. of resource units earned in routing operation An example is overhead based on the number of direct labor hours. Although you can develop an item cost for material overhead subelements based on resource units, it is not earned in WIP. Resource Value You use the Resource Value basis type to allocate overhead to an item based on a percentage of the resource value. For material overhead and overhead subelements, the cost per item is calculated within each cost type as follows: Cost per item = Overhead rate * Resource value earned in the routing operation An example is overhead based on the number of direct labor dollars. Although you can develop an item cost for material overhead subelements based on resource value, it is not earned in WIP. Total Value You use the Total Value basis type to allocate overhead to an item based on a percentage of the total value. For material overhead subelements, the cost per item is calculated within each cost type as follows: Cost per item = Total cost – Material overhead earned at this level * Material overhead rate The material overheads based on total value can be earned when you receive purchase orders or when you perform WIP completion transactions.

Oracle’s Overhead Application Method (Example)
Material Overhead Resource Activity Application Basis Type Method of Applying Overhead Management P.O. Process (Number of POs) Amount per Item Based on Activity Freight-In Total Value (Buy Items) Single Rate ( Buy Items Only) Production Control Planning (# of Work Orders) Facility Resource Value (i.e Labor Cost) Per Department Benefits Plant-Wide MFG Engineering Resource Units (i.e. Std Hours) Single Amount Indirect This shows an example of how overhead is applied to an item. If you select Activity for the basis, open the Activity tabbed region and: Enter the number of activity occurrences for the current costing period, i.e., the total number of times this activity is performed during the current costing period. Enter the total number of items you expect to be associated with the activity during the current costing period, i.e., the total number of units that flow through the activity during the same period.

Overhead Rates Assigned

Overhead Cost Applied To Item (Example)
Resource Currency Type UOM Basis Cost Overhead FINASSY Person No HR Item Administration SETUP Person No HR Lot Administration Overhead Name Dept Basis Rate/Amount Administration FINASSY Resource Value 01.50 Packing FINASSY Item 30.00 Department Resources Overheads FINASSY FINASSY Administration SETUP Packing Routing Op Department Resources Usage Rate/Amt FINASSY SETUP 01.00 10 FINASSY 00.50 Resource subelement cost Overhead subelement cost SETUP 01 x 1/10* x = Administration 2.00 x 1.50 = 03.00 FINASSY 50 x = Administration 7.50 x 1.50 = 11.25 *The item costing lot size = 10 Packing 1.00 x = 30.00

Need Overhead Cost Pools
Material Overhead Resource Overhead Material Management Freight-In Production Control Facility Benefits MFG Engineering Indirect Amount Per Item (Activity) Single Rate (Buy Items Only) (Per Dept) (Plant-Wide) Single Amt. Overhead Cost Pools Dollar$ ??? Activity / Volumes Number of Purchase Orders Total $ Value of Buy Items Number of Work Orders Resource $ Value Resource Units (Std Hours) Rates or Amounts $$ %

Cost Pool Allocation Step-Down Allocation Indirect Overhead
Finance & IS Budget Overhead Cost Element Pools Facility Administration Manufacturing Organization Departmental Budget Material Overhead Material Mgmt Freight-In Production Control Indirect MFG Engn’g Benefits

Cost Pool Allocation Many Departments

Cost Pool Allocation Indirect Overhead What Is The Process?
Administration Budget Facility Budget Finance & IS Budget Manufacturing Organization Departmental Budget Material Overhead Cost Element Pools Overhead Cost Element Pools Material Mgmt Freight-In Production Control Indirect MFG Engn’g Benefits Facility

Summarize Agenda Items 1-2-3
Assess & Design Overhead Allocation Methods Standard Cost Overhead Sub-elements Oracle’s Overhead Application Basis Types Cost Pool Allocation Process Using Oracle’s MassBudgets & AutoAllocations Questions & Answers

Summary - Agenda Items 1-2-3
Design assessment > Keep the End in Mind Overhead allocation principles Allocation Methods: Traditional vs. Activity and the advantages and disadvantages The applicability of overhead allocation methods Oracle’s cost elements: MOH & ROH Oracle’s application Basis Types Step-down allocation process

Overhead Allocation Methods Standard Cost Overhead Sub-elements Oracle’s Overhead Application Basis Types Cost Pool Allocation Process Using Oracle’s MassBudgets & AutoAllocations Questions & Answers Now let’s review Oracle’s MassBudgets and AutoAllocations functionality and understand how they both can facilitate the creation of OVERHEAD COST POOLS….

Oracle’s MassBudgets Definition
A feature that allocates expenses across a group of cost centers, departments, divisions, and so on. It allows you to build a complete budget/Cost Pool using simple formulas based on actual results, other budget amounts, and statistics. For example, you might want to allocate your facility overhead costs to each of your departments based on the square footage in each department.

MassBudgets vs. MassAllocations What is the Difference?
Same Functionality MassAllocation’s Balance Types: Actual Encumbrance MassBudget’s Balance Type Budget only

MassBudget’s Major Features
Allocate cost pools to many accounts using a single formula Base your allocations on Current Period, Previous Period, or Year Ago, Same Period Base your allocations on monetary or statistical account balances Define your allocation formulas once, and use them as frequently as needed Run MassBudgets multiple times without reversing the outdated amounts Use MassBudgets to do rate-based, usage-based and step-down allocations Include summary accounts or foreign currency amounts in your allocations

MassBudgeting Process
Step 1: Define Cost Pool Budget Step 5: Create MassBudget batches Step 2: Copy Operating Budget to Cost Pool Budget Step 6: Define a MassBudget formula per batch Step 3: Gather Allocation Bases (Statistical Data) Step 7: Validate MassBudget Batch formulas Step 4: Review and determine Allocation formulas Step 8: Generate MassBudget journals and Post

Step 1: Define Cost Pool Budget
Create a budget to represent a collection of estimated amounts for a range of accounting periods. You can use AutoCopy to create a new budget from an existing budget.

Step 2: Copy Operating Budget Amounts
Hit AutoCopy Button Select Source Budget

Step 3: Gather Allocation Bases (Statistical Data)
Review all required statistical accounts and enter additional values into the Account Segment. For example Headcount, Production Hours, Resource $ Value, etc. Enter Budget amounts/journals for each account combination for all statistical data.

Step 4: Determine Allocation Formulas
Review your requirements and determine the allocation formulas. For example determine your allocation basis to allocate IS overhead to other departments. Define Rollup Groups and Summary Accounts for allocation purposes. List the required MassBudget batches in sequence. A summary account is an account whose balance is the sum of balances from multiple detail accounts. Use summary accounts to perform online summary inquiries, as well as speed the processing of financial reports, MassAllocations, and recurring journal formulas. A rollup group is a collection of parent values. Only parent values can be assigned to a rollup group. Parent values and child values belong to the same value set, which is then attached to a key flexfield segment. A rollup group allows you to group related parent values for creating summary templates. Given a summary template, General Ledger creates summary balances using all parent values assigned to that rollup group.

Step 5: Create MassBudget Batches for Each Step-Level
Group MassBudget batches by allocation level This assures accurate cost pools

Step 6: Define MassBudget Formulas

Step 7: Validate MassBudget Batch Formulas
After you define a new allocation batch, or change an allocation formula, you must validate the batch by running the MassBudget Validation program. The program verifies that your allocation formulas conform to the allocation formula definition rules. Allocation Formula Rules Use the following definition rules when creating your allocation formulas. The allocation-validation program checks that your formulas adhere to these rules: For formula lines A, B and C (operand lines): You can enter either an amount or an account in lines A, B and C. If you enter an account, child values must have a Constant segment type. Parent values may have a Constant, Looping or Summing segment type. You can use a Constant segment type with a parent value only if it references a summary account. If you use a Looping segment type on the same segment in more than one of the operand lines, you must use the same parent. If you use a Looping segment type in your Target line, you must use a Looping segment type on the same segment using the same parent in lines A, B or C. To use summary accounts, all segments in your formula must be assigned a segment type of Constant. For target and offset lines (lines T and O) You must enter an account in the Target and Offset lines. Detail values must have a Constant segment type. Parent values must have a Looping segment type. Your Target account must be different from your Offset account. For the target line only (line T) If you use a Looping segment type in lines A, B or C, you must use a Looping segment type on the same segment using the same parent in your Target line. For the offset line only (line O) You can only use a Looping segment type in your Offset line if the corresponding segment type in your Target line is Looping. If you use a Looping segment type in your Offset line, you must use the same parent as in your Target line. Validation Business Rules If you choose to use Full Cost Pool Allocation, below are the business rules used to validate your Allocation Formula Rules for lines A, B, and C. If your full cost pool allocation contains violations of the business rules, the execution report will detail the errors. 1. Line B is account based. 2. Line B has at least one looping segment. 3. Line C is account based and has the same segment values as line B. 4. Line C uses Constant or Summing segment type if line B uses Constant or Summing segment type. 5. At least one Summing or Constant segment in line C corresponds to a looping segment in line B.

Step 8: Generate MassBudget Journals
Using budget journals maintain an audit trail for your budget balances. Generate MassBudget Journals to create unposted budget journal batches based on your validated MassBudget formulas. The generated journal batch contains an entry for every allocation formula in the batch.

Understanding Oracle’s Formula Syntax
Budget Pool (A)* [Usage Factor (B) / Total Usage (C)] OR Segment Assignments Types: - Looping >(Parent values only) - Summing >(Sum child values) - Constant >(Child Value or Parent with Summary Account) Budget Pool (A)* [Usage Factor (B) / Total Usage (C)] Segment Assignments Types: Looping - Assign this type to a parent segment value to include each child value assigned to the parent value in the formula. The allocation program runs each formula once for each corresponding child segment value. You can loop only on parent values. Summing - Assign this type to a parent segment value to sum the account balances of all the child segment values assigned to a parent. For example, if you enter a parent that has five child values, the allocation program adds the account balances of the five child accounts and uses the sum in each MassBudget formula. You can sum only on parent values. Constant - Assign this type to a child segment value to use the detail account balance associated with the child. You can also use this type with a parent segment value if there is a summary account associated with the parent. Target Account (T) Offset Account (O) Allocation Formula Rules Use the following definition rules when creating your allocation formulas. The allocation-validation program checks that your formulas adhere to these rules: For formula lines A, B and C (operand lines): You can enter either an amount or an account in lines A, B and C. If you enter an account, child values must have a Constant segment type. Parent values may have a Constant, Looping or Summing segment type. You can use a Constant segment type with a parent value only if it references a summary account. If you use a Looping segment type on the same segment in more than one of the operand lines, you must use the same parent. If you use a Looping segment type in your Target line, you must use a Looping segment type on the same segment using the same parent in lines A, B or C. To use summary accounts, all segments in your formula must be assigned a segment type of Constant. For target and offset lines (lines T and O) You must enter an account in the Target and Offset lines. Detail values must have a Constant segment type. Parent values must have a Looping segment type. Your Target account must be different from your Offset account. For the target line only (line T) If you use a Looping segment type in lines A, B or C, you must use a Looping segment type on the same segment using the same parent in your Target line. For the offset line only (line O) You can only use a Looping segment type in your Offset line if the corresponding segment type in your Target line is Looping. If you use a Looping segment type in your Offset line, you must use the same parent as in your Target line. Validation Business Rules If you choose to use Full Cost Pool Allocation, below are the business rules used to validate your Allocation Formula Rules for lines A, B, and C. If your full cost pool allocation contains violations of the business rules, the execution report will detail the errors. 1. Line B is account based. 2. Line B has at least one looping segment. 3. Line C is account based and has the same segment values as line B. 4. Line C uses Constant or Summing segment type if line B uses Constant or Summing segment type. 5. At least one Summing or Constant segment in line C corresponds to a looping segment in line B. Target Account (T) Offset Account (O)

Overhead Allocation Methods Standard Cost Overhead Sub-elements Oracle’s Overhead Application Basis Types Cost Pool Allocation Process Using Oracle’s MassBudgets & AutoAllocations Questions & Answers Now let’s review Oracle’s MassBudgets and AutoAllocations functionality and understand how they both can facilitate the creation of OVERHEAD COST POOLS….

Oracle’s AutoAllocation Definition
AutoAllocations is a powerful feature to automate journal batch validation and generation for MassBudgets. Two types of AutoAllocation Parallel AutoAllocation: Validates and generates all the journal batches in your AutoAllocation set simultaneously. Step–Down: Create journal batches in a specific sequence. Order your journal batches so that the posted results of one step are used in the next step of the AutoAllocation set.

AutoAllocation Process
Step 2: Submit AutoAllocation Step 1: Define AutoAllocation Set Step 3: Review Status of AutoAllocation Step 4: Post Generated Journals

Step1 Define AutoAllocation Set
Using the Full Allocation Method Choose the Full allocation method to generate journals that reverse previous allocations and post new allocation amounts. When you post the generated allocation journals, the net effect is the same as replacing the existing target balance with the new allocated amounts from your formula. Use this method only if you are allocating amounts for the first time, or only once. Using the Incremental Allocation Method Choose the Incremental allocation method whether you want to update allocated balances without reversing the previously allocated amounts. Using this method, you can generate allocation journals as many times as you wish, provided there is no activity against the target accounts between runs. Attention: Do not use the incremental method the first time you generate a MassAllocation or MassBudgeting formula.

Step 2: Submit AutoAllocation Set

Step 3: View Status of AutoAllocation Set
View Status for each Step

Now Let’s Put It All Together Example
Time Permitting Now Let’s Put It All Together Example Using Mass Budgeting create the Facility overhead cost pool. Assumptions: The OH application method is a single rate based on resource value of the budgeted production volume per department. You must perform all previous (top-level) allocations first. Remember to create a step-down AutoAllocation set to insure the proper sequence for an accurate cost pool.

Now Let’s Put It All Together Example
Using Mass Budgeting create the Facility overhead cost pool. Assumptions: The OH application method is a single rate based on resource value of the budgeted production volume per department. You must perform all previous (top-level) allocations first. Remember to create a step-down AutoAllocation set to insure the proper sequence for an accurate cost pool.

Facility Overhead Cost Pool Production Departments
Allocation Sequence 1. 2. Administration Budget Finance & IS Budget Facility Budget Facility Overhead Cost Pool 3. 4. Allocate Admin expenses to the facility department. Allocate Finance & IS expenses to facility department. Allocate Facility department(s) to Facility OH cost pool. Allocate Facility OH cost pool to production departments and development facility Overhead Rates for each department. Manufacturing Indirect Departments Manufacturing Production Departments Metal Plating PCB Test Packing Sub-Assembly Final Assembly

MassBudget Process COMPLETED Step 1: Define Cost Pool Budget
Step 5: Create MassBudget batches Step 2: Copy Operating Budget to Cost Pool Budget Step 6: Define a MassBudget formula per batch COMPLETED Step 3: Gather Allocation Bases (Statistical Data) Step 7: Validate MassBudget Batch formulas Step 4: Review and determine Allocation formulas Step 8: Generate MassBudget journals.

Step 5: Define Mass Budget Batch
Defined MassBudget Batch: HR & Admin Allocation

Administration Expense (OH) Allocation Basis
Based on number of headcount per department Note: You do not have to allocate all Admin. Expenses by the same basis Remember to group all Administration allocations in the same MassBudget batch for proper sequencing later.

Administration Overhead Allocation
01 = Company = Administration Parent = Total Expense Parent T = Total All Departments HCNT = Headcount = MassAllocations In 8200 = MassAllocations Out Account Company-Department-Account Currency Amount Type Relative Period A Summary Account USD PTD or YTD Current Period * C-C-C B 01-T-HCNT STAT PTD / C-L-C C C-S-C T: 01-T-8100 O: Looping (L): Assign this type to a parent segment value to include each child value assigned to the parent value in the formula. The allocation program runs each formula once for each corresponding child segment value. You can loop only on parent values. Summing (S): Assign this type to a parent segment value to sum the account balances of all the child segment values assigned to a parent. For example, if you enter a parent that has five child values, the allocation program adds the account balances of the five child accounts and uses the sum in each MassBudget formula. You can sum only on parent values. Constant (C): Assign this type to a child segment value to use the detail account balance associated with the child. You can also use this type with a parent segment value if there is a summary account associated with the parent.

Finance & IS Expense (OH) Allocation Basis
Possible Allocation Basis Number of headcount per department Optionally use multiple allocation steps: Allocate Cost Accounting portion of Finance Allocate IS expenses based on Departmental activity study of IS services consumed. Allocate Payroll on headcount

Finance & IS Overhead Allocation
01 = Company = Finance & IS Parent = Total Expense Parent T = Total All Departments HCNT = Headcount = MassAllocations In 8200 = MassAllocations Out Account Company-Department-Account Currency Amount Type Relative Period A Summary Account USD PTD or YTD Current Period * C-C-C B 01-T-HCNT STAT PTD / C-L-C C C-S-C T: 01-T-8100 O:

Facility Expense (OH) Allocation Basis
Square Footage per Department

Facility Overhead Allocation
01 = Company = Facility Parent = Total Expense Parent T = Total All Departments SQFT = Square Footage = MassAllocations In 8200 = MassAllocations Out Account Company-Department-Account Currency Amount Type Relative Period A Summary Account USD PTD or YTD Current Period * C-C-C B 01-T-SQFT STAT PTD / C-L-C C C-S-C T: 01-T-8100 O:

AutoAllocation Process
Step 2: Submit AutoAllocation Step 1: Define AutoAllocation Set Step 3: Review Status of AutoAllocation Step 4: Post Generated Journals Step–Down AutoAllocation invokes an automated process managed by Oracle Workflow. The process initiates the GL Allocation process and directs batches to the GL MassAllocation process or the GL Recurring Journals process. These processes validate batches and determine if approvals are required for a batch, submit the batch(es) to approvers if required, then notify individuals of the approval results. If errors occur, the contact or responsibility may choose to roll back the Step–Down AutoAllocation process. The rollback reverses all journal entries. The Step–Down AutoAllocation process consists of five main processes: •Automatic Step–Down Allocation Process •GL Allocation Process •GL MassAllocation Process •GL Recurring Journal Process •GL Posting Process Batch validation, generation, rollback, and workflow notifications are all sub-processes that can be launched at various stages of these main processes. If Journal Approval is required for a generated batch before posting, AutoAllocations launches Journal Approval and sends two notifications: an advisory notification to the AutoAllocation step contact and a notification to the Journal Approval contact. Once the journal is approved, the AutoAllocation process proceeds.

Submit AutoAllocation Set
Step–Down AutoAllocation invokes an automated process managed by Oracle Workflow. The process initiates the GL Allocation process and directs batches to the GL MassAllocation process or the GL Recurring Journals process. These processes validate batches and determine if approvals are required for a batch, submit the batch(es) to approvers if required, then notify individuals of the approval results. If errors occur, the contact or responsibility may choose to roll back the Step–Down AutoAllocation process. The rollback reverses all journal entries. The Step–Down AutoAllocation process consists of five main processes: •Automatic Step–Down Allocation Process •GL Allocation Process •GL MassAllocation Process •GL Recurring Journal Process •GL Posting Process Batch validation, generation, rollback, and workflow notifications are all sub-processes that can be launched at various stages of these main processes. If Journal Approval is required for a generated batch before posting, AutoAllocations launches Journal Approval and sends two notifications: an advisory notification to the AutoAllocation step contact and a notification to the Journal Approval contact. Once the journal is approved, the AutoAllocation process proceeds.

Questions & Answers Michael Anenen SSi North America (312) 755-8257
Paul Kraskiewicz SSi North America (312)

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