Subledger Accounting (SLA) Configuration for OPM in R12

1. Subledger Accounting (SLA) Configuration for OPM in R12 Shailendra Naithani, Principal Product Manager(OPM) Venkat Chukkapalli, Group Manager(OPM Development)

2. Agenda • Subledger Accounting(SLA) - Introduction • Architecture overview • Manufacturing Accounting Controller(MAC) vs. SLA • Setting up SLA for OPM • SLA Use Case: Misc Receipt Accounting • OPM Period End Closing using OPM Financials • SLA Advanced Configuration: • Custom Sources • Q&A

3. Ledger Subledger Accounting Subledger Accounting General Ledger Subledger Accounting Subledger Accounting Subledger Accounting Subledger Accounting Subledger Accounting IntroductionWhat is SLA? Payables Payables General Ledger Receivables Receivables OPM Accounting representation strongly tied to subledger transactions

4. OPM Costing with MAC Completed material and resource transactions OPM Costing engine generates cost MAC processes transactions and creates journals Subledger Accounting Replaces MAC OPM Costing with SLA Completed material and resource transactions OPM Costing engine generates cost Preprocessor creates accounting events SLA processes these events to create journal entries

5. Key Changes Summary • Process Manufacturing Financials is the Subledger for all OPM transactions • MAC Obsoletes and replaced by SLA • No need for separate accounting units and accounts • No need for Ledger mappings • Account derivation based on flexible condition based rules • Test Subledger update replaced by Create accounting-Draft • Subledger Update replaced by Create accounting- Final mode • Inventory Close for Process Organizations • Handled by OPM Costing • Preliminary Close is still supported for Process Organizations • Period Ending Balances saved in an OPM Costing Table (GMF_PERIOD_BALANCES) • Inventory Valuation report available in OPM Costing reports

6. Subledger Accounting Replaces MAC OPM example with Order Management Shipping Shipping (OMSO) Internal Order Shipments Order Management Customer Returns(RMA)

7. Event Model - Example

9. Subledger Accounting Replaces MAC Equivalent functionality in SLA

10. Event Entity Event Class Event Type R12 Subevent Event 11i Event Model- SLA vs MAC

11. R12 11i JLTs vs. Account Titles

12. SLA ADR vs. MAC Account Mapping

13. Primary Ledger(OPM US) Subledger Accounting Method-Standard Accrual Application Accounting Definition (AAD for Process Manufacturing Financials) Journal Line Definitions Journal Line Types Account Derivation Rules Journal Entry Descriptions Sources Transaction Objects Subledger Accounting Method StructureExample- Vision Environment

14. Subledger Journal Entry Description Account Derivation Rule Line Type

15. Agenda • Subledger Accounting(SLA) - Introduction • Architecture overview • MAC vs. SLA • Setting up SLA for OPM • SLA Use Case: Misc Receipt Accounting • OPM Period End Closing using OPM Financials(Costing and SLA) • SLA Advanced Configuration: • Custom Sources • Q&A

16. SLA Setup

17. Setup Account Derivation Rules • Corresponds to Account Mapping and Priority setup of 11i OPM MAC • Query a seeded rule and creates custom ADR with owner as ‘User’ • Output type can be an entire accounting flexfield or a specific segment in the accounting code combination • Multiple conditions can be separated by ‘AND/OR’ logic • Key Takeaways: • Do not modify seeded ADRs. Create custom ADRs • Define custom ADRs for rules such as AAC, AAP, DCOGS depending on your business needs

18. Setup Journal Lines Definition • JLD created with owner ‘User’ • JLDs are created for an Event class and Event type combination • Multiple journal line types (JLTs) are associated to a JLD. These JLTs correspond to Account Titles of MAC • ADRs are associated to the JLTs

19. Setup Applications Accounting Definition • AAD created with owner ‘User’ • Specific to a particular application • Contains all event classes and event types

20. Setup Subledger Accounting Method(SLAM) • SLAM created with owner ‘User’ • Specific to a ledger • Contains AADs from all applications

21. Assign SLAM to Primary Ledger

22. Agenda • Subledger Accounting(SLA) - Introduction • Architecture overview • MAC vs. SLA • Setting up SLA for OPM • SLA Use Case: Misc Receipt Accounting • OPM Period End Closing using OPM Financials(Costing and SLA) • SLA Advanced Configuration: • Custom Sources • Q&A

23. Perform a Miscellaneous Transaction

24. Run OPM accounting preprocessor

25. Run Create Accounting

26. Output of create accounting- INV and IVA accounts

27. Agenda • Subledger Accounting(SLA) - Introduction • Architecture overview • MAC vs. SLA • Setting up SLA for OPM • SLA Use Case: Misc Receipt Accounting • OPM Period End Closing using OPM Financials(Costing and SLA) • SLA Advanced Configuration: • Custom Sources • Q&A

28. OPM with SLA - The Process

29. Run the preliminary inventory close

30. Run Preliminary cost update process

31. Run OPM Accounting Pre-processor

32. Run Detailed Subledger Report

33. Review the accounting entries

34. Inventory Close- Final

35. Final Cost Update

36. Create accounting –final mode • On Submitting program, the following requests will be invoked: • Create Accounting • Accounting Program • Journal Import and • Subledger Accounting Balances Update

37. Agenda • Subledger Accounting(SLA) - Introduction • Architecture overview • MAC vs. SLA • Setting up SLA for OPM • SLA Use Case: Misc Receipt Accounting • OPM Period End Closing using OPM Financials(Costing and SLA) • SLA Advanced Configuration: • Custom Sources • Q&A

38. Custom SourcesExample1 • Extend the list of sources available to application accounting definitions • Used to derive accounts based on non-standard sources • PL/SQL function used to derive the source • Return value can be a string, an accounting flexfield or a value set

39. Custom SourcesExample2 Business Case: Customer  needs to capture purchasing details(PO Number, Line Number, Supplier Name, Item Number, Item Description) on the journal entry descriptions for Receive to Inspection accounting events. Solution Approach using custom sources: 1. Create PL/SQL Functions for Item Number, Item Description etc create or replace FUNCTION GET_ITEM_NAME(p_inventory_item_id IN NUMBER , p_organization_id IN NUMBER) return varchar2 IS  CURSOR c_item_name IS select concatenated_segments from mtl_system_items_kfv where inventory_item_id = p_inventory_item_id and organization_id = p_organization_id;   l_item_name VARCHAR2(100) :=' '; BEGIN   OPEN c_item_name; FETCH c_item_name INTO l_item_name; CLOSE c_item_name;   RETURN l_item_name; END GET_ITEM_NAME;

40. Custom SourcesExample2….continued 2. Create Custom Sources for PO Number, Line Number, Supplier Name, Item Number, Item Description 3. Create Journal Entry Description using custom sources

41. Custom SourcesExample2….continued 4. Assign Journal Entry Description to the Receive to inspection Event type

42. Custom SourcesExample2….continued 5. Run the Create Accounting Procedure

43. Inventory valuation accounts using Subinventory

44. Changes – Summing up • 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. • Account Titles replaced by Journal Line Types (JLT) in SLA. • Account Mapping functionality replaced by Accounting Definition Rules (ADRs) in SLA. • Test Account Mapping replaced with TAB Test Accounting Builder. • Test Sub Ledger process replaced with Draft Sub Ledger Accounting in SLA • Subledger Detail Report modified to go against SLA repository.

45. Q & A Shailendra.naithani@oracle.com Venkat.chukkapalli@oracle.com