Oracle SLA and Acctg entries

1. Cost Accounting As You Want It
─ EBS R12 Cost Accounting with SLA
Collaborate09
May 3 - 7, 2009
Diane Streubel
diane.streubel@schreiberfoods.com
Schreiber Foods
Manager for Cost & Systems Development
OAUG Process MFG Cost Sub-Committee Lead
Douglas Volz
davolz@comcast.net
Douglas Volz Consulting, Inc.
President / Managing Director
OAUG Discrete MFG Cost Sub-Committee
Lead

2. Agenda
• Oracle Discrete Costing SLA enhancements
• Oracle Process Costing MAC transitioning to SLA
• Oracle SLA Concepts
• Case example: Product Line Accounting
Slide – 2 Cost Accounting As You Want It ─ EBS R12 and SLA

3. Oracle Discrete Costing SLA enhancements:
Increased Flexibility
Release 11i account recognition “pain points” eliminated by
Subledger Accounting (SLA):
• SLA removes limitations for recording COGS and
Revenue (Cost Account Generator/workflow and A/R
AutoAccounting are still in use)
• Gives you the ability to record inventory and WIP accounts
with more flexibility
Slide – 3 Cost Accounting As You Want It ─ EBS R12 and SLA

4. Oracle Discrete Costing SLA enhancements:
Increased Flexibility
Flexible variance account recognition for:
– Invoice price and purchase variances
– Average cost adjustment
– Standard cost adjustment
– Manufacturing variances
– Account aliases
– Freight charges
– Most other inventory, manufacturing and related
account entries
Slide – 4 Cost Accounting As You Want It ─ EBS R12 and SLA

5. Oracle Process Costing:
MAC transitioning to SLA
Slide – 5 Cost Accounting As You Want It ─ EBS R12 and SLA

6. 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
Slide – 6 Cost Accounting As You Want It ─ EBS R12 and SLA

7. OPM MAC transitioning to SLA
11i OPM
GMI
(OPM Inventory)
Purchasing Order GMD, GME
Management
Cost Setup Calculate Cost Store Costs MAC Oracle GL
Slide – 7 Cost Accounting As You Want It ─ EBS R12 and SLA

8. OPM MAC transitioning to SLA
R12 OPM
Oracle
Purchasing Order Inventory Management
GMD, GME
Cost Setup Calculate Cost Store Costs SLA Oracle GL
Slide – 8 Cost Accounting As You Want It ─ EBS R12 and SLA

9. 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.
Slide – 9 Cost Accounting As You Want It ─ EBS R12 and SLA

10. OPM MAC transitioning to SLA
Interface
General Ledger
11i OPM
Subledger GL Export Journal Import Journal Posting
For G/L integration, discrete costing works the same as OPM costing
Slide – 10 Cost Accounting As You Want It ─ EBS R12 and SLA

11. OPM MAC transitioning to SLA
PPaayyaabblleess
RReecceeiivvaabblleess
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Oracle Subledger
Accounting Oracle General
Ledger
OPM
R12 OPM
For G/L integration, discrete costing works the same as OPM costing
Slide – 11 Cost Accounting As You Want It ─ EBS R12 and SLA

12. OPM MAC transitioning to SLA
OPM MAC
Completed material
and/or resource
transactions.
OPM Costing Engine
generates costs.
OPM Subledger
process processes
these transactions to
create Journal entries
SLA
Completed material
and/or resource
transactions.
OPM Costing Engine
generates costs.
Cost Pre-processor
will create
accounting Events
SLA accounting
program processes
the events to create
the journal entries
Slide – 12 Cost Accounting As You Want It ─ EBS R12 and SLA

13. OPM MAC transitioning to SLA
OPM MAC SLA COMMENTS
Fiscal Policy Retained with few modifications
Event Fiscal Policy Retained with few modifications
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
Slide – 13 Cost Accounting As You Want It ─ EBS R12 and SLA

14. OPM MAC SLA 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
OPM MAC transitioning to SLA
Slide – 14 Cost Accounting As You Want It ─ EBS R12 and SLA

15. 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
Slide – 15 Cost Accounting As You Want It ─ EBS R12 and SLA

16. OPM MAC transitioning to SLA
• Historical OPM Subledger distribution data not
migrated to SLA
– Data refers to OPM Inventory
• Historical data available in query mode
Slide – 16 Cost Accounting As You Want It ─ EBS R12 and SLA

17. OPM MAC transitioning to SLA
Update the Account Derivation Rule conditions.
Ex: Add Item/Item Class/Organizations
Validate the Application Accounting Definition
Run OPM Accounting Pre-Processor
Run OPM Accounting Pre-Processor
Run Create Accounting in Draft mode
Check Create Accounting report and Journal
Entries report
Run Create Accounting in Final mode to create GL
accounting entries
Slide – 17 Cost Accounting As You Want It ─ EBS R12 and SLA

18. OPM MAC transitioning to SLA
• NO LOSS of functionality by moving to SLA model
• New menus created under OPM Financials for new
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.
Slide – 18 Cost Accounting As You Want It ─ EBS R12 and SLA

19. Oracle SLA Concepts
Slide – 19 Cost Accounting As You Want It ─ EBS R12 and SLA

20. Subledger Accounting Method (SLAM) Setup Steps
1. Determine sources of information for your account derivation
rules (understand the underlying business logic and data)
2. Create account derivation rules (and optional mapping sets)
3. Create journal line types
4. Create a journal lines definition
(link the journal line type to the account derivation rule)
5. Create an application accounting definition
(copy an existing definition and modify it and then validate it)
6. Create a subledger accounting method (SLAM)
(copy “standard accrual” and create a new one)
7. Assign the new SLAM to a Ledger
Slide – 20 Cost Accounting As You Want It ─ EBS R12 and SLA

21. Key Concepts for SLA Transaction Types
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
EVENT
TYPE
The most granular level of
business event which has
accounting impact
Slide – 21 Cost Accounting As You Want It ─ EBS R12 and SLA

22. Setup and Process
JOURNAL ENTRY SETUPS
Define/copy and modify
account derivation rules
Define/copy and modify
journal line types
Define/copy and modify
descriptions
PROCESS
Enter Transaction(s)
Cost Manager
Create Accounting* Transfer Journal Entries to GL
*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.
Slide – 22 Cost Accounting As You Want It ─ EBS R12 and SLA

23. Transactions
Accounting Events
Accounting
Configurations
Cost Management SLA
Subledger
Journal Entries
Subledger
Balances
Accounting
Program
Journal Entry Setup
GL
Journal Entries
and Balances
Setup and Process
Slide – 23 Cost Accounting As You Want It ─ EBS R12 and SLA

24. Basic Table Structure for SLA
Same Cost
Transaction
Accounting
Tables
SLA Accounting Tables
Enter Transaction(s)
Cost Manager
Transaction
Accounting Tables
XLA_EVENTS
XLA_AE_HEADERS
XLA_AE_LINES
XLA_DISTRIBUTION
_LINKS
Create
Accounting
Slide – 24 Cost Accounting As You Want It ─ EBS R12 and SLA
GL_
INTERFACE
G/L Tables
GL_LEDGERS
GL_JE_BATCHES
GL_JE_HEADERS
GL_JE_LINES
One Common
Accounting
Subledger
Table

25. Case Example:
Product Line Accounting for Discrete and
Process Costing
Slide – 25 Cost Accounting As You Want It ─ EBS R12 and SLA

26. Example:
Purchase Price Variance product Line
Say there are 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
(works for Discrete and Process Costing)
– Category Accounting – R11i Cost Accounting migrated to
SLA in R12.1
(only works with Discrete Costing)
Slide – 26 Cost Accounting As You Want It ─ EBS R12 and SLA

27. Cost/SLA Mapping Set Capability
(for Discrete and Process Costing)
Slide – 27 Cost Accounting As You Want It ─ EBS R12 and SLA

28. Cost SLA Mapping Set Capability:
PPV by product Line
• Product Line Setup Steps Using SLA mapping set
1. Create the product line information in your item master
2. Enter your SLA account derivation rule for Purchase Price
Variance accounts
3. Associate the new account derivation rule to your Journal
Line Type
4. Associate the Application Accounting Definition with
Subledger Accounting Method
Slide – 28 Cost Accounting As You Want It ─ EBS R12 and SLA

29. Cost/SLA Mapping Set Capability
• Product Line Accounting – Descriptive flexfield
Slide – 29 Cost Accounting As You Want It ─ EBS R12 and SLA

30. Cost/SLA Mapping Set Capability
• Product Line Accounting – Item Descriptive FF
Slide – 30 Cost Accounting As You Want It ─ EBS R12 and SLA

31. Cost/SLA Mapping Set Capability
• Assign product line code to the inventory item
TIP: you can use an existing product line category set to populate
your item master DFF, you do not need to enter this one-by-one
Slide – 31 Cost Accounting As You Want It ─ EBS R12 and SLA

32. Cost/SLA Mapping Set Capability
• Mapping set – Account Derivation Rule
Slide – 32 Cost Accounting As You Want It ─ EBS R12 and SLA

33. Cost/SLA Mapping Set Capability
• Mapping set – Account Derivation Rule
Slide – 33 Cost Accounting As You Want It ─ EBS R12 and SLA

34. Cost/SLA Mapping Set Capability
• SLA Journal Line / Derivation Rule
Slide – 34 Cost Accounting As You Want It ─ EBS R12 and SLA

35. Cost/SLA Mapping Set Capability
• Associate Journal Lines Definition to the Event Class
Don’t forget
to validate
your new
AADs
Slide – 35 Cost Accounting As You Want It ─ EBS R12 and SLA

36. Cost/SLA Mapping Set Capability
• Note the same ADR is usable for Standard Cost Update
Slide – 36 Cost Accounting As You Want It ─ EBS R12 and SLA

37. Cost/SLA Mapping Set Capability
• Note the same ADR is usable for Standard Cost Update
Slide – 37 Cost Accounting As You Want It ─ EBS R12 and SLA

38. Cost/SLA Mapping Set Capability
• Associate SLA Definition to the SLA Method/Ledger
Slide – 38 Cost Accounting As You Want It ─ EBS R12 and SLA

39. Cost/SLA Mapping Set Capability
• The material subledger from 11i still exists
Inventory
Inventory
PPV
Receiving
Matl
Overhead
Absorption
Slide – 39 Cost Accounting As You Want It ─ EBS R12 and SLA

40. Cost/SLA Mapping Set Capability
• SLA Entries That Go to Your G/L
Slide – 40 Cost Accounting As You Want It ─ EBS R12 and SLA

41. Cost/SLA Mapping Set Capability
• For the Standard Cost Updates That Go to Your G/L
Slide – 41 Cost Accounting As You Want It ─ EBS R12 and SLA

42. Category Accounting –
Discrete Cost Accounting migrated
to SLA in R12.1
Slide – 42 Cost Accounting As You Want It ─ EBS R12 and SLA

43. Product Line Category Accounting
• Create a new
structure under
the key flexfield
“Item Category”
Slide – 43 Cost Accounting As You Want It ─ EBS R12 and SLA

44. Product Line Category Accounting
• Create a new
structure under
the key flexfield
“Item Category”
• Create category
codes
Slide – 44 Cost Accounting As You Want It ─ EBS R12 and SLA

45. Product Line Category Accounting
• Create a new
structure under
the key flexfield
“Item Category”
• Create category
codes
• Create category
set
Slide – 45 Cost Accounting As You Want It ─ EBS R12 and SLA

46. Product Line Category 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
Slide – 46 Cost Accounting As You Want It ─ EBS R12 and SLA

47. Product Line Category Accounting
• Assign product line category accounts
Slide – 47 Cost Accounting As You Want It ─ EBS R12 and SLA

48. Product Line Category Accounting
• Account Derivation Rule would have used a source directly
Slide – 48 Cost Accounting As You Want It ─ EBS R12 and SLA

49. Product Line Category Accounting
• Summary Notes
– Product line accounting can be achieved in many ways without
using the 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 desired using BI Publisher.
Slide – 49 Cost Accounting As You Want It ─ EBS R12 and SLA

50. Discrete 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.
Slide – 50 Cost Accounting As You Want It ─ EBS R12 and SLA

51. Acknowledgements of assistance:
• Herve Yu – Oracle Cost Management Development Manager
• Audrea Auld – Oracle University Senior Financials Instructor
• Russell Bayles – Oracle Principal Product Strategy Manager
• Michel Basinet – Oracle Director Fusion Costing Product Strategy
Slide – 51 Cost Accounting As You Want It ─ EBS R12 and SLA

52. Additional information available from:
• R12 Oracle Subledger Accounting – Implementation Guide
• R12 Oracle Cost Management – User Guide
• R12 Oracle Process Manufacturing Cost Management - User Guide
Slide – 52 Cost Accounting As You Want It ─ EBS R12 and SLA

53. TTHHAANNKK YYOOUU
Slide – 53 Cost Accounting As You Want It ─ EBS R12 and SLA

54. Appendix
• Professional Background for Diane Streubel
• Professional Background for Douglas Volz
Slide – 54 Cost Accounting As You Want It ─ EBS R12 and SLA

55. Diane Streubel
Professional Background
Diane Streubel is the Cost & Systems Development Manager for Schreiber Foods. A process
manufacturing company, Schreiber is the world’s largest supplier of private label dairy products and
has been using Gemms/OPM for the past 13 years. Diane has been involved with OPM from it’s
inception at Schreiber with Gemms 3.1. She has been involved in implementing additional products
within Oracle at Schreiber and has played a key role in all of the upgrades within the company.
Schreiber Foods is currently at 11.5.10.
Diane is also actively involved in the Process Manufacturing SIG. She has been the Costing Sub-
Committee chairperson and the Membership chairperson for the Process SIG since 2001. As the
Process SIG Enhancements chairperson, she has worked with the Process Manufacturing team at
Oracle to develop and coordinate an Enhancements Voting process each year since 2001. She has
been on the paper selection team for OAUG conferences for the past four years. Diane has also
presented numerous papers at OpenWorld and OAUG conferences over the past several years on
OPM Costing topics.
Core Expertise
• Upgrades for Process Manufacturing
• Project Management
• Core manufacturing processes
 OPM Cost Management
 OPM Inventory
 OPM Formulas
Experience
Within Schreiber Foods:
• Responsible for OPM Costing and Inventory testing and
validations for all upgrades
• Develop and improve processes within Company related
to Costing, Inventory and Formulas
• Establish Cost Accounting methods, cost and production
formula structures, inventory and production transaction
processes and system documentation.
• Train Finance employees at 17 plant facilities on OPM
processes
Slide – 55 Cost Accounting As You Want It ─ EBS R12 and SLA

56. Douglas Volz
Professional Background
Doug Volz is a Senior Architect and Advisor for Oracle Application projects, with a particular interest in
Project and Cost Management. He has 30 years experience, including 5 years in Oracle Development
(co-designing Oracle Cost Management), 12 years in industry for manufacturing and distribution
companies, and 14 years consulting. His Manufacturing and Cost systems experience covers project
management, software design/development, delivery and consulting services, for both Oracle
Corporation, and multiple international consulting firms. Prior to his systems career, Mr. Volz also held
numerous management accounting positions for telecommunications, defense, and electronics firms.
In his consulting roles, Doug has served over 100 clients. Many of these were multi-org, multi-currency
with global footprints. Countries include US, Mexico, UK, Netherlands, Belgium, Taiwan, P.R.O.C.,
Norway, Japan and Germany.
Doug leads the Cost Sub-Committee, for the OAUG Discrete Manufacturing Special Interest Group.
He also advises and participates on the Oracle Customer Advisory Board for Fusion Costing and for
the Fusion SCM Strategy Council.
Core Expertise
• Multi-organization, Multi-currency ERP
Implementations
• Project Management and Senior Project Advisor
• Core manufacturing processes
 Cost Management
 Inventory
 Bills of Material
 WIP
• Systems Integration and Data Conversions
Experience
Sample of clients served:
• Beckman Coulter (US)
• Onninen AS (Norway)
• Matsushita (UK, Mexico)
• NTL (now Virgin Media)
• Idec Izumi (Japan)
• Motorola (UK, US)
• Logitech (US, Taiwan, P.R.C.)
Slide – 56 Cost Accounting As You Want It ─ EBS R12 and SLA

57. End of Presentation
Slide – 57 Cost Accounting As You Want It ─ EBS R12 and SLA