A useful chart of accounts provides flexibility for recording and reporting financial information, brings structure for managing uniformly, and enhances communication. Five fundamental criteria for chart of accounts design in Oracle E-Business Suite will allow your business to create a forward-thinking chart of accounts to optimize growth and flexibility, while minimizing maintenance. eprentise founder and CEO Helene Abrams goes over the five fundamental design criteria and how to design your own chart of accounts. Watch the webinar recording: https://vimeo.com/82202289 Website: www.eprentise.com Twitter: @eprentise Google+: https://plus.google.com/u/0/+Eprentise/posts Facebook: https://www.facebook.com/eprentise

1. Designing a Chart of Accounts for
a Global Company going to Oracle
E-Business Suite Release 12
Helene Abrams
CEO
eprentise
habrams@eprentise.com

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Q&A addressed at the end of the session.
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3. Learning Objectives
After completion of this program you will be able to:
 Objective 1: List the five fundamental design criteria for creating a
forward-thinking chart of accounts.
 Objective 2: Explain how to design a chart of accounts to
accommodate future growth.
 Objective 3: Describe how a good design enables you to reduce
costs, streamline reporting, and provide global visibility.
 Objective 4: Identify how to leverage Release 12 features like
subledger accounting and ledger sets.
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4. Agenda
 Introduction
 Chart of accounts (COA) basics
 Designing a good COA
 5 fundamental criteria for a good COA design
 Accommodating future growth
 Reduced costs, streamlined reporting, and global visibility
 Leveraging Release 12 features
 Global visibility, local compliance
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5. : Transformation Software for E-Business Suite
Company Overview: Established 2006 l Helene Abrams, CEO
eprentise Can…
…So Our Customers Can:
 Consolidate Multiple EBS Instances
 Change Underlying Structures and
Configurations
 Chart of Accounts, Other Flexfields
 Inventory Organizations
 Operating Groups, Legal Entities,
Ledgers
 Calendars
 Costing Methods
 Resolve Duplicates, Change Sequences,
IDs
 Separate Data
 Reduce Operating Costs and Increase
Efficiencies
 Shared Services
 Data Centers
 Adapt to Change
 Align with New Business Initiatives
 Mergers, Acquisitions, Divestitures
 Pattern-Based Strategies
 Make ERP an Adaptive
Technology
 Avoid a Reimplementation
 Reduce Complexity and Control Risk
 Improve Business Continuity, Service
Quality and Compliance
 Establish Data Quality Standards and a
Single Source of Truth
| 5

6. Chart of Accounts Basics: The Flexfield
Example Structure
Segments, Values, Code Combinations
Company
Business
Unit
Cost
Center
Region
Account
01
100
150
East
1111
02
100
210
West
2222
Values
01.100.150.East.1111
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Code Combination

7. Chart of Accounts Basics: Segments
 The EBS accounting flexfield accommodates up to 30 segments for
categorizing transactions
 Structurally analogous to columns in a table
 Have defined lengths for the values they contain
 Answering the questions Who, What, Where, Why, and possibly
How helps identify segments that will give your accounting flexfield
the ability to classify each transaction
 Common segment examples: Cost Center, Department, Fund,
Location, Product Line
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8. Flexfields in the Form
Code Combinations
Accounting Key Flexfield
Value Descriptions
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9. Chart of Accounts Basics: Hierarchy
 The accounting flexfield incorporates parent-child relationships
among values
 Roll-up Groups
 A collection of parent values for a given segment
 Used to create summary accounts
 The most detail is at the lowest level
 Summary Accounts
 Hierarchical rollup of children and/or parents
 Faster reporting
 Account balance inquiries
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10. 5 Fundamental Criteria for a Good COA
1.
There is only one type of information in each segment.
2.
Information in the chart of accounts is not repeated from other
modules.
3.
There is enough room to expand within each segment.
4.
Summary accounts and rollup groups fall naturally within ranges.
5.
You are able to report on critical business components with
standard reports without resorting to spreadsheets. FSGs and
other reports should be easy to create.
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11. Criteria 1: One Type of Information per Segment, and
Only One Type of Information in a Single Segment
 Information should not overlap across segments.
 If each segment contains one (and only one) type of information,
you:
 Reduce the maintenance of keeping information accurate in two places
 Reduce the possibility of introducing errors into your accounting
 Case: If your cost center has the same type of information as a
business unit segment, there is no need to implement both.
 Case: You shouldn’t have a Department segment value such as HR –
Sacramento, CA if there is also a Location segment in the chart.
| 11

12. Criteria 2: Information Not Repeated
 The accounting flexfield should not repeat information that exists in
other modules of EBS.
 Reduced maintenance and errors (similar to Criteria 1)
 Case: If you are implementing Oracle Projects modules, there is no
need to have a project segment in your accounting flexfield.
 Case: If you are implementing Receivables, then there is no need for
a customer segment.
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13. Criteria 3: Enough Room to Expand

Define your segment lengths to be long enough to accommodate future values added.
Note: Although it likely won’t be an issue, the maximum number of characters for a
code combination string is 240, so there are upper limits on how long you can define
your segments.

When designing values be sure to allow enough room for future growth within each
rollup group



Increment by at least 5 within each group
Increment by 10 if the group is likely to be a high growth area.
Example: If you have a location segment, allow enough room to add ten additional
values between each of your lowest levels. Your Location segment hierarchy might
look like this:
10000 US
11000 Midwest
11100 Detroit Metropolitan Area
11110 Ann Arbor
11120 Canton
11130 Plymouth
20000 Canada
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14. Criteria 4: Use Logical Ranges
 Ranging your values logically promotes streamlined reporting,
security, and maintenance.
 Include a whole range of values in your rule (cross validation, security)
and FSG report definitions
 Exclude specific values if needed
 Minimize the number of cross validation rules needed (under 50 using
logical ranges compared to hundreds or thousands when not using
logical ranges)
 Use numbers only randomly.
 Avoid using intelligent numbers
 For items with embedded intelligent numbers like Products, introduce
non-intelligent numbers as well
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15. CVR Implications on COA Design
 Out of Range — Cross-validation rules can get messy if your chart of
accounts values are not organized in logical ranges.
 Rule elements are much more complex due to the inability to rely on
value ranges for exclusion
 Example Goal: Prevent revenue account values between 30000 and
40000 from being used with any department values other than the
following 5 values (we’ll begin with the familiar global Include element):
 3001
 5057
 6124
 8537
 9905
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16. CVR Implications on COA Design
 Example Goal: Preventwith— 6account values betweenthan theand
Exclude being used revenuedepartment Required 30000
Elements any Steps values other
40000 from
following 5 values (we’ll begin with the familiar global Include element):
 Need Exclude elements for all the values above and
below each of  5057  6124  8537values
3001 the department  9905
And finally, this prevents all departments below 3001 from being
This statement statement prevents all departments greater than
This statement prevents all departments greater than 5057 and
8537
3001
6124
less than 6124 from being used:
99059905 being used:
8537
5057
from
used:
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17. CVR Implications on COA Design

18. Criteria 5: No Reliance on Spreadsheets
 Be able to get the information you need from built-in EBS reports.
 Real-time value
 No errors introduced by use of spreadsheets
 Streamlined workflow, lower resource requirements, and reduced
maintenance
 No need to integrate with 3rd party reporting applications
 Capitalize on a master row set for FSG reports.
 Allows you to generate different reports without having to rewrite each
report
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19. A Global Chart of Accounts
 Primary ledger is single source of truth for all accounting,
reconciliation, and analytical reporting
 Consistency but flexibility to accommodate different requirements
 External reporting without relying on a separate financial
consolidation system
 Drill down to individual transactions in the subledgers without
translation
 Transparency (3 - 5 years) to meet IFRS standards and international
auditing requirements
 Common metrics and reporting structures with common
interpretation
Enterprise Visibility with Subledger Accounting and
Secondary Ledgers
| 19

20. A Global Chart of Accounts – Reduced Costs
 Reduce complexity of configurations
 Cross validation rules
 Security rules
 Reporting within ranges
 No conversions required for data warehouse queries, drill-down to
subledgers, ad-hoc reporting
 Facilitate movement to shared service centers
 Single COA to manage
 Standardized training
 Enterprise governance and control of new combinations
 Reduce redundancies
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21. A Global Chart
of Accounts –
Reduced
Complexity
BalSeg
GPS Book
BalSeg
006
025
GPS LKR
025
027
AsiaPac EUR
201
001
002
001
002
Sri Lanka
AsiaPac GBP
301
005
005
Sri Lanka
AsiaPac AUD
401
106
105
Seg
BalSeg
BalSeg
Seg
205
205
565
GPN Book
565
027
Sri Lanka
Bk
025
AsiaPac LKR
CCY
Location
US
USD
US
Comerica
NAm USD
002
Canada
CAD
USD
Canada
NAm CAD
Sri Lanka
Location
Op Unit
BalSeg
Canada
005
001
002
LKR
USD
Sri Lanka
EUR
GBP
AUD
Singapore
Philippines
103
SGD
USD
Singapore
AsiaPac SGD
023
Philippines
AsiaPac PHP
027
105
103
107
911
913
953
027
107
GPN PHI
570
570
912
913
953
911
912
106
US SOB
106
GPS US
107
PHP
USD
005
105
912
031
GPN CHN
801
801
913
029
USD
Sri Lanka
Maldives
GPS CNY
031
Philippines
103
107
031
CNY
GPN IND
802
802
USD
Taiwan
911
029
GPS INR
029
China
Maldives
912
GPS TWD
030
911
030
GPN TWN
803
803
105
Singapore
China
AsiaPac USD


No more messy financial
consolidations using
spreadsheets
R12 eliminates the need for
using and maintaining
multiple charts of accounts
China
AsiaPac CNY
031
022
GPS MOP
022
022
GPN MAC
545
545
USD
India
AsiaPac INR
029
028
GPS MYR
028
028
GPN MLS
804
804
MOP
Taiwan
AsiaPac TWD
030
024
GPS BND
024
024
GPN BRU
505
505
Hong Kong
Streamline the month- and
year-end closing processes
913
030
Macau

HKD
Macau
AsiaPac MOP
022
006
CAN SOB
915
915
025
106
201
GPN SRL
585
585
GPN SNG
575
575
GPN HK
525
525
UK SOB
851
851
India
Taiwan
INR
India
USD
TWD
Malaysia
MYR
Hong Kong
AsiaPac HKD
021
Brunei
BND
Malaysia
AsiaPac MYR
Brunei
AsiaPac BND
024
UK
Europe GBP
951
UK
Europe EUR
Europe USD
953
GBP
UK
Europe SGD
954
EUR
USD
UK
Europe CAD
955
SGD
CAD
UK
Europe AUD
956
UK
Europe HKD
006
952
UK
006
028
957
955
201
952
GPS CAD
955
GPS EUR
201
952
301
951
GPS GBP
301
951
401
956
GPS AUD
401
956
023
954
GPS SGD
023
954
021
021
957
GPS HKD
021
957
953
955
958
GPS CHF
958
951
956
959
GPS DKK
959
954
957
960
GPS JPY
960
959
960
961
GPS NOK
961
961
962
GPS NZD
962
962
963
963
GPS SEK
963
301
GPS
US
201
301
401
401
US
SOB
103
023
952
AUD
UK
HKD
CHF
DKK
JPY
NOK
UK
UK
Europe CHF
Europe DKK
958
UK
Europe JPY
960
UK
Europe NOK
961
UK
SEK
958
959
NZD
Europe NZD
962
UK
Europe SEK
963
Russia
RUB
GPN RUS
DolEx US
USD
RUS
DOLEX US
DLX
DloEx Mexico
MXN
DOLEX MX
DolEx Guatemala
GTQ
DOLEX GT
Eurofil
EUR
GPN EUR
EUR
Muzo
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Bk
001
CZK
GPN MZO
MZO
© 2013 eprentise. All rights reserved.

22. R12 Features – Ledger Sets






Open/Close periods
Create journals
Allocations across ledgers
Recurring journals for all ledgers
Elimination sets for all ledgers
Translate and revalue balances
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 View information without changing
responsibilities
 View journals and account balances across
ledgers
 Submit standard reports
 Create financial statements that include
data for multiple ledgers
© 2013 eprentise. All rights reserved.

23. Global COA Design Recommendations
 Add an intercompany segment – take advantage of AGIS
 Add a segment to accommodate local requirements
 Ranges, rollups defined for each country to use
 Local bank accounts
 Statutory reporting
 Location segment (optional) but helps with security, cross
validation
 Implement other modules for detailed tracking at a local level
(through an OU)
 Project Accounting
 Collections
 Implement Multiple Reporting Currencies, secondary ledgers to
report in different currencies
| 23

24. Leveraging the Chart of Accounts for
Global Operations
Two ways to handle local/regulatory requirements
 Separate Segment
 Each country can use a range of values for their statutory requirements
Analysis Segment Ranges
France
Descriptions
000321
Crédit Agricole Bank Account
000544
000000-001000
Values
Droits D'enregistrement Tax
001001-002000
Italy
001321
Intesa Sanpaolo Bank Account
002001-003000
UK
002321
Barclays Bank Account
002584
VAT Tax
 Secondary Ledger
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25. Under Chart of Accounts Mapping, select Create Mapping or query
“Chart of Accounts Mapping from Oracle’s navigation window
| 27
© 2013 eprentise. All rights reserved.

26. Define the Mapping title and description and add a Source and
Target Chart of Accounts
| 28
© 2013 eprentise. All rights reserved.

27. Target and Source fields above will populate with the segments
from the defined COA’s
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© 2013 eprentise. All rights reserved.

28. Available segment rules available under action options
| 30
© 2013 eprentise. All rights reserved.

29. For each segment selected, additional rule options will populate, in
this instance providing a transfer of detail ranges
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© 2013 eprentise. All rights reserved.

30. Global Visibility – Local Compliance with R12
Subledger Accounting, Accounting Methods Builder Replaces Global Accounting Engine
| 32

31. How Do You Leverage AGIS?

Advanced Global Intercompany System
 Intercompany Balancing
 Intercompany Invoicing
 Intercompany Reconciliation/Eliminations
 Manual Intercompany Transactions

Netting Process

Common Chart of Accounts

Intercompany Segment
| 33

32. Conclusions
 Use the transition to R12 to redesign your COA if it is not optimized or
to adopt a single COA if your organization is currently using multiple
charts.
 As you are redesigning your COA, focus on the 5 fundamental criteria.
 One type of information per segment
 No repeated information from other EBS modules
 Leave room for future expansion and flexibility
 Use logical ranges
 Make sure you can get the reporting you need straight from the flexfield
structure
 Design your chart with Ledger Sets, Secondary Ledgers, Subledger
Accounting, AGIS in mind.
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33. Questions?
| 35

34. Thank You!
Helene Abrams
CEO
www.eprentise.com
habrams@eprentise.com
- One World, One System, A Single Source of Truth -
| 36
© 2013 eprentise. All rights reserved.