Overview

In GL there has been a number of changes:

• Terminology Changes
  • Set of Books (SOB) is now Ledgers
  • Multiple Reporting Currencies (MRC) is now Reporting Currencies
  • Global Intercompany System (GIS) is now Advanced Global Intercompany System (AGIS)
• Obsolete
  • Global Accounting Engine (AX) replaced by Subledger Accounting
  • MRC as a workaround – now fully integrated as Reporting Currencies
• Accounting Setup manager – New central management of legal entities and legers
• Legal Entities – now really used
• Ledgers – new name and setup for SOBs
• Ledger sets – ledger grouping and security feature
• Reporting Currencies – MRC has now been cleaned up and is better integrated
• Period rates – now all daily rates and managed in same way
• Revaluation and Translation – changed functionality
• Journal Reconciliation
• Advanced Global Intercompany System (AGIS) – changed functionality

Accounting Setup Manager

The new Accounting Setup Manager simplifies and centralizes accounting-related setup for common financial components that are shared across financial applications. From a central location, you can define your legal entities and their accounting context, such as the ledgers and reporting currencies that perform the accounting for your legal entities.

The setup steps are:

• Legal Entity
• Primary Ledger
• Reporting Currencies
• Balancing Segment Value Assignments
• Subledger Accounting Options
• Operating Units
• Intercompany Accounts
• Intercompany Balancing Rules
• Sequencing
• Secondary Ledgers

Each of the setup steps is a number of sub screens where some are described later.

Legal Entities

Legal Entities part of Accounting Setup Manager now holds important information for both tax and VAT reporting.

General

Registrations

This is where you would put in information for the Corporations Office

Establishments

List of all locations

Balancing Segments

This is a new important feature that the balancing segment now relates to the legal entity.

Primary Ledger

Ledgers are mostly the same as the old Set Of Books however the setup screens has changed a bit.

Definition

Nothing really new here except for the OFA screen.

Options

Similar to the old screens in a new wrapping.

Advanced Options

Again similar to old days except for the new Journal Reconciliation option.

Ledger Sets and Data Access Sets

The Ledger Set is a great new feature which lets you manage multiple ledgers as one – a especially useful feature for faster closing. However the ledgers must share the following information:

• Chart of accounts
• Calendar/period type combination

You can open/close periods for multiple ledgers at once, run recurring journals that update balances for multiple ledgers. So it goes way beyond report sets or cross COA FSG reports.

Ledger Set

Strange though – this is a non-OFA screen…having thought that all new features was pushed to OFA.

Similar to the Ledger Set the Data Access Set provides security at same level so ledgers must still share the following information:

• Chart of accounts
• Calendar/period type combination

The security can be at the following levels:

• Full Ledger – access to the whole COA
• Balancing Segment Value – access to specific balancing segment values
• Management Segment Value – access to specific management segment values

Note the Management Segment is a new segment qualifier. If you what your cost centre to be secured and used in Data Access sets enable the Cost Centre segment as a Management Segment. Remember if your COA has been used there is a specific procedure for doing this to avoid corruption.

Data Access Set

The system always generate a Data Access Set with same name and full access for each:

• Primary Ledger
• Secondary ledger
• Ledger Set
• Reporting Currency (also creates a Reporting Currency + Source Ledger Data Access Set)

Data Access Set security can be combined with Segment Value Security Rules and will work as a logical AND so only where the two overlaps access will be allowed.

Reporting Currencies

The reporting currency definition is now comprised from the R11i options for reporting sets of books and the MRC profile options.

Period Rates

Period Rates Replaced by Daily Rates and all new OAF screens.

Currency Rates Manager:

Revaluation and Translation

Revaluation sets are now usable across ledgers that share a common chart of accounts. In some cases, you may need to enter the secondary tracking segment for revaluation sets involving a secondary tracking segment before running revaluations with upgraded templates.

General Ledger modifies revaluation templates to use corresponding daily rates for those that used period rates prior to the upgrade.

Journal Reconciliation

Journals can now be reconciled if an account has been marked as such.

The is a useful feature for clearing accounts or tax accounts which should balance to zero.

Account Setup

Note this is a cash clearing account which is a good candidate for journal reconciliation.

So in this case you would enable the segment qualifier “Reconcile” to “Yes”.

Journal Entry

Note the new “Reconciliation Reference” field. This is used both for automatic and manual reconciliation.

Unreconciled Lines

Search for unreconciled journal lines using the parameters above.

Reconcile Journal

No journals to reconcile here – but you see the point?

Then add your Apps server to IE8 security settings:

Lower the security setting to medium-low for Trusted Sites:

Allow pop-ups from the Apps server:

When you start the application for the first time you may get one or more warnings like this:

Just keep clicking run and it should work.

Note IE8 is not yet supported by Oracle.

In general the limited per module 11i setup has been changed to become a proper self-contained tax engine. With that however comes complexity to the extent that E-Business Tax almost can be regarded as a module in itself.

Hopefully some best practices can be applied here so over time we will have a good template of standard solutions depending on type of business and geographical region.

E-Business tax fully use the TCA and legal entity data model so all involved parties in tax reporting must be defined in TCA – like HM Revenue and Customs – and your reporting business unit must be defined as a legal entity too.

E-Business Tax also introduces many new concepts like:

• Tax Authority: organisation responsible for collecting taxes
• First Party Legal Entity: your organisations that have taxable transactions
• First Party Legal Establishment: your organisation having tax registration in order to report and settle taxes
• Tax Regime: Name of an area of tax like VAT in the UK
• Tax Zone: Grouping of Tax Regimes
• Tax Jurisdiction: The geographical boundary of a tax related to a tax regime
• Tax: Defines name of a tax within a Tax Regime – like VAT
• Tax Status: Level of taxes within a tax regime – like Standard, Reduced, Exempt and Zero
• Tax Recovery Rate: Rate of a recoverable tax – like Full (100%) and None (0%)
• Tax Rate: Rate of tax applied to an transaction – like Standard would have 14%, 17.5% and 15% depending on date
• Tax Rule: Rule which is applied to a transaction to provide for the tax calculation for:
  • Determine Place of Supply: Determine the location for transaction
  • Determine Tax Applicability: Determine what taxes apply to a transaction
  • Determine Tax Registration: Determine tax registration number for the transaction
  • Determine Tax Status: Determine the level of tax applicable
  • Determine Tax Rate: Determine the rate based on the tax level
  • Determine Taxable Basis: Determine the amount taxable
  • Calculate Tax Amounts: Determine the tax amount
  • Determine Recovery Rate: Determine the recovery rate

So quite an expansion of the 11i definitions in one form having a single line of tax code and tax rate…

Anyway before doing a major setup exercise have a read of the note: in Note 463001.1 – which may save you the setup for Europe.

An example of UK VAT to follow:

The section below is only tested on Vision – which is not a live system.

Tax Regimes

Controls and Defaults

Associations

All first party legal entities and operating units must be associated with the tax regime they are subject to.

Party Tax Profiles

Tax Authority

This is the organisation to whom you must report and settle taxes.

First Party Legal Entity

This is a organisation that creates taxable transactions.

- Configuration Options

First Party Legal Establishment

This defines your organisation that reports and settles tax with the tax authority hence here you define you tax registration details.

- Tax Registration

Taxes

This is the name of the tax and how it is handled.

Controls and Defaults

Tax Statuses

These are names of tax levels so in the UK the STANDARD VAT is for all basic goods and services but a REDUCED rate is paid for fuel and power and ZERO would be paid for food and books. Do not put the actual rate in the name is you would in 11i as this will be defined in the Tax Rates section.

Tax Jurisdictions

Tax Recovery Rate

Tax Rate

This is rate of a tax status like STANDARD VAT would have been 14%, 17.5% and 15% over time.

Country Defaults

Setup the default tax configuration for a country.

Tax Simulator

Use this screen to simulate the tax setup without entering real transaction. This is very useful when changing the configuration on a live system.

Be sure to assign the “Oracle Tax Simulator” responsibility to the user and use this rather than using the menu on the home page of “Tax Administrator” – otherwise you will get this error:

So from the “Oracle Tax Simulator” responsibility use:

And you will see this:

When clicking \Tools\View Tax Log:

A concurrent job will be submitted. You may be get this error:

However this is not any issue – just wait a bit and retry or just monitor the request in \View\Requests:

This report will show how the tax was calculated.

Subledger Accounting is a new application that provides an accounting abstraction layer for subledgers – between subledger accounting events and GL journal entries.

This functionality was in 11i placed in each of the subledgers implemented in different way resulting in different reconciliation processes for each of the subledgers.

Subledger Accounting also replaces the Global Accounting Engine (AX) which essentially in 11i was a add-on or workaround that bypassed the subledger accounting entries to provide a better audit trail and catered for special localization requirements for countries like Italy and Spain.

However the AX was only supported for some countries so in a global implementation you would have different reconciliation processes for the same application depending on the country was using AX or not.

Global Accounting Engine module is therefore obsolete in R12.

Subledger Accounting is now supported for all countries for the following modules:

• Assets  
• Cash Management  
• Contract Commitment  
• Cost Management  
• Federal Financials  
• Financials Common Modules  
• Loans  
• Payables  
• Payroll  
• Process Manufacturing Financials
• Projects  
• Property Manager  
• Purchasing  
• Receivables  
• Trade Management

Subledger Accounting streamlines the accounting and reconciliation process between any of the above subledgers and the GL.

Each of the subledgers interface to Subledger Accounting sending the accounting events and amounts and then Subledger Accounting translates this into accounting entries for GL based on accounting rules.

Subledger Reporting and Reconciliation

WIP

Accounting Method Builder (AMB)

WIP

Accounting Setup

Subledger Accounting setup screen are located as a sub-application General Ledger:

This will give you access to the Accounting Setup form:

As Subledger Accounting setup is always done in the context of the ledger you must first search for this.

Click “Update Accounting Options” and you will get the following form:

For “Subledger Accounting Options” click “Update”:

This provides you with a list of currently supported subledgers for which you can update either the Accounting Options or the System Options.

System Options:

This is most a technical tuning page and has no functional impact.

From the user guide:

You can define the processing unit size at the event class level to process a large
number of items in one commit cycle. A processing unit is the number of
transactions processed by the Create Accounting program in one commit cycle. The
Create Accounting program processes the default processing unit size at the
application level.

Accounting Options:

These options used to be in each individual application but are now moved to a common screen. Great!

A nice new feature is “Stop at Error Limit” – especially handy when designing a new chart of accounts.

Scroll down and you get:

The Journal Category – used to be specified in the subledger as well now much more ordered and can be customized for any application and any event.

Technical

Had a look at the tables in SQL Developer. It looks to me that Subledger Accounting has borrowed the AP concept of the AP_AE_… tables – now in XLA called XLA_AE_… tables.

Main tables are:

• XLA_AE_HEADERS – containing information about source application and accounting event
• XLA_AE_LINES – containing multiple lines of information for each of the above events regarding the financial side of the transaction like DR/CR and CCID

The new tables is also now segmented by LEDGER_ID rather than by ORG_ID as it was in 11i. This completely ties in with the new R12 architecture and is a great improvement.

XLA_AE_HEADERS example:

The XLA_AE_HEADERS relates to XLA_EVENT_TYPES:

So the entity id in XLA_AE_HEADERS is for AP_INVOICES validation event.

This is a completely new module to provide a central payment capture and disbursement facility.

Overview

• New Concepts: Payment Processing Profile, Payment Request and Payment Instruction
• Payment disbursement functionality for Payables
• Credit card functionality for Advanced Collections and Receivables
• Bank account transfer functionality for Cash Management
• Secure storage and encryption of payment data including credit cards
• Payment document formatting uses XML Publisher
• Electronic transfer functionality built-in
• Obsoletes iPayments

New Concepts

A number of new concepts has been introduced but the main ones are:

• Payment Process Profile – governs how a payments for documents payable having a specific payment method is processed
• Payment Request – one or more documents payable in a subledger requested to be paid
• Payment Instruction – payments for one or more documents payable having same Payment Process Profile ready to be printed or transferred to a bank

In 11i – Payables would make all payments however in R12 this task is now split between the subledger and Payments:

The subledger – in this case Payables – select documents payable and create a Payment Request for Payments. After this point Payments takes over and perform the remaining tasks.

New steps are the Payment Request and the Payment Instruction creation.

Payment Process Profile is assigned during Create Payment Request.

Payment Request acts as an interface between the subledger and Payments. So the Payment Requests are a ledger of Payments needed.

Payment Instruction acts as a internal representation of a physical payment or cheque print file. So the Payment Instruction is the ledger of Payments made.

Confirm is changed so now only pre-numbered cheques needs to be confirmed. For other types of payments they will automatically be confirmed in accordance to the Payment Profile which is default at Format Payment time.

Payment Disbursements

All payment disbursements are now performed by the Payments module. This means that the Payables module like any other subledger sends a payment request to the Payments module. Payments will then create payment instructions based on the payment request.

Payment Workbench:

As payment instructions can now be combined across organisations the concept of a payment batch has changed – now there is payment requests and payment instructions:

• Payment Request: One or more documents selected to be paid
• Payment Instruction: One or more payment requests having same payment profile

Payment Request form:

In 11i – one payment batch was one collection of invoices to be paid by one payment method in one file however in R12 the 1:1 relationship has gone and one payment request can be split into multiple payment instructions and multiple payment requests can be combined into one payment instruction if using same payment profile. One payment instruction would then result in one payment file or transfer.

11i logical data model:

R12 logical data model:

The R12 payment profile can be defaulted on the payment request however Oracle Payments will have the final say of which payment profile is being used. The payment process does not always have to be a two step process however in that case the payment profile must be specified at time of payment request.

The ability of combining multiple payment requests into a single payment instruction will significantly reduce number of bank transfers and therefore reduce payment costs especially in larger organisations.

Credit Cards

Mostly used for small business and retail – so parked for now.

Bank Account Transfers

WIP

Security

WIP

Payment Document Formatting

WIP

Electronic Transfer

WIP

The new centralized bank account model provides a single point for defining and managing internal bank accounts for Oracle Payables, Oracle Receivables, Oracle Payroll, Oracle Cash Management, and Oracle Treasury.

Biggest change in cash management is for the users as many screens are now as OAF forms:

Screens has been converted into OAF forms owned by CE but can still be called from AP:

Other changes are logical data model changes and was long overdue so a welcome change.

Overview

• Banks and Branches now managed by Cash Management and data stored in the TCA data model
• Bank Accounts now managed by Cash Management and data is segmented by legal entity so accounts can be shared across organisations
• Payment Document Sequence Numbers is now defined by bank account

Bank and Bank Branches

Banks and branches are now defined in the Oracle Trading Community Architecture (TCA). This makes sense as the organisational model of a bank and its branches is no different from any other business having a party and some sites.

Banks and Bank Branches:

Update Bank:

Note this form actually edits a party in TCA.

Update Branch

Bank Branch Addresses

Branch Contacts

Bank Accounts

A single legal entity is granted ownership of each internal bank account, and one or more organizations are granted usage rights. In addition  bank accounts can be accessed by multiple operating units, but are owned by a single legal entity.

Example of an internal bank account below.

Bank Accounts – Owner and Use

Note the new Bank Account Owner field. Great feature.

Bank Accounts – Account Information

Bank Accounts – Account Controls

Yes – this IS one page. In 11i this was handled by tabs but this concept is not used in R12 OAF.

Bank Accounts – Account Access

This is new as well  – where you can control what organisations has what access per account.

Bank Accounts – Create Contact

Payment Document Sequence Numbers

These are now handled by Cash Management at bank account level using a Payment Document Category on the Payment Document. The Payment Document Category is created as usual when defining sequential numbering.

Payment Documents

Note the new functionality for managing cheque books.

It is my intent to go through core financials in R12 as an internal project in order to make a structured approach to new features and changes in the new release.

So the notes below only applies to core Financials modules in scope.

This should prove useful when working with 11i based customers and consultants.

The Upgrade User Guide is not very detailed and when you look closer into each module you will realise the changes made are much more significant than stated.

This will have a major impact on businesses upgrading from 11i as not only are there many changes to the user interface but even more so are the changes to many of the maintenance forms where the underlying data model has changed completely. This will also have a major implications on any customisations or interfaces made.

Modules in scope in alphabetical order – module id:

• Advanced Collections – IEX
• Assets – FA
• Cash Management – CE
• E-Business Tax – ZX
• Financials for Europe – JE
• General Ledger – GL
• Payables – AP
• Payments – IBY
• Receivables – AR
• Subledger Accounting – XLA
• Trading Community Architecture – HZ
• XML Publisher – XDO

General Changes

Obsolete Modules

• Global Accounting Engine – AX – replaced by Subledger Accounting functionality
  AX always seemed to be a workaround rather than a core element of the architecture – so a great step forward.
• iPayments – replaced by Payments functionality

Oracle Applications Framework – OAF

There seems to be a shift towards the Oracle Applications Framework – OAF based web forms from the professional java based client. In general this is good as the java client only was supported by a limited amount of browsers. However I have already had a few problems with the OAF buttons in various browsers like Google Chrome – so there may still be compatibility issues ahead. Always test and re-test.

Architecture Changes

• TCA is now the container for all organisations and people in OA with the inclusion of suppliers, banks, employees and internal organisations.
  No more need to link suppliers to customers and data conversions has been simplified.
• XML Publisher is becoming the core output tool weather it is reporting, business intelligence or external communication.
  This will enable non-technical people to make simple custom reports.
• Multi-org security managed by security profiles instead of one organisation per responsibility.
  A great functionality for shared services centres.
• MRC functionality now replaced by Reporting Currencies so rather than maintaining dual set of books it is now reported from one ledger only.
• Subledger Accounting – both replaces Global Accounting Engine but also provides a single approach to GL posting from all subledgers.
  This should sort out all the custom reporting needs to verify and reconcile accounting from various modules. I have had loads of fun with the AP AE tables and can’t wait to see them go.

Many changes has been made to AP but all great improvements though.

Overview

• Suppliers: are now defined in Trading Community Architecture – TCA
• Invoice lines: entity added between header and distributions
• Banks and bank accounts: now part of Cash Management
• Banks and branches: are now defined in TCA like suppliers
• Payment document sequence numbers: has been moved to bank account uses
• Payments: moved to and integrated with Payments for funds disbursements
• Accounting: moved to and integrated with Subledger Accounting
• Tax: moved to and integrated with E-Business tax

Suppliers

Supplier entry has moved from the professional screens to OAF screens:

Invoice Lines

The addition of invoice lines enables AP to retain the external representation of an invoice keeping internal accounting on the distribution lines.

So an external invoice with two products would have an invoice header with two invoice lines. If each of the products are split between two departments then the invoice would have four distribution lines.

The invoice lines are added as an extra tab in the invoice workbench:

The representation also ties better in with Purchasing where items are ordered at line level and distributed at shipment level.

The distribution lines are still in a separate screen as in the old days:

Banks, Bank Branches and Banks Accounts

Banks and bank accounts have been split into two parts:

• Bank and bank branches as organisations is now defined in TCA
• Bank accounts as financial information is now defined in Cash Management – CE
• Bank accounts are owned by the legal entity and can now be shared by multiple organisations

More details in the R12 – Cash Management blog entry.

Payments

Payment has been completely revamped and got it’s own module now – Oracle Payments – however the payments screens can still be accessed from Payables if user setup allows.

Payments can also be setup for a central treasury organisation to issue payments from different payables organisations as long as they are all in same legal entity. In the latter case the payables clerk would issue a payment request however the central treasury organisation would issue the payment instruction to the bank.

More details in the R12 – Payments blog entry.

Accounting

The Payables accounting architecture has been changed from being local to AP to utilise the new module Subledger Accounting.

To generate accounting and transfer to GL process itself is not much different however.

Concurrent program “Create Accounting”:

The Invoice Workbench – Create Accounting options matches the Subledger Accounting functionality:

Draft: to create accounting that can be viewed and modified

Final: to create accounting ready for posting to GL

Final Post: to create accounting and immediately post it to GL

All Subledger Accounting is now based on Payables accounting events. These accounting events are predefined in Payables and can be translated into actual accounting by the Subledger Accounting system.

Accounting Events form:

Note this is a standard Subledger Accounting form so it will look similar in other subledgers as well.

How the accounting event to account translation works is described in the blog section: R12 – Subledger Accounting

Tax

The tax architecture has changed from being part local to AP and AR to be a separate module – E-Business Tax.

An invoice still has the same amount of tax lines however new fields has been added like Tax Regime.

The tax regime determines what tax codes are available.

Tax Details form:

This tax architecture is for sales and value added taxes only and does not manage income and withholding tax.

When tax is calculated is determined by tax events similar to accounting events.

Tax Events form:

To determine the tax defaults – AP has a number of predefined tax drivers. This is very different from 11i but gives more flexibility for defaulting based on the type of invoice which is mapped to an event class.

Tax Drivers form:

More details in the R12 E-Business Tax blog entry.

I’m running R12.0.4 on OEL5.3 with Virtualbox 2.2.2 having a Windows 7 machine.

R12

R12 is installed on OEL with the hostname: localhost.localdomain

Firefox works locally against R12 so the EBS stack in working at this point.

Start the database, listener and apps. See Managing R12:

$ addbctl start

$ addlnctl start VIS

$ adstrtal apps/apps

To test if a database network connection would work try:

$ sqlplus apps/apps@VIS

Virtualbox

Installed Vbox 2.2.2 on OEL. Get it from http://www.virtualbox.org

Setup Vbox host-only network in \File\Preferences

and give it a ip like 192.168.2.7 on the adapter tab:

and setup the dhcp tab like this:

When the Vbox machine is started you should be able to ping it:

Windows 7 in Virtualbox

I use Windows 7 RC.

Create a Vbox machine and mount the downloaded Win7 ISO as CDROM and run install:

You get it from here:

Setup Vbox networking like this:

This will communicate through the 192.168.2.7 ip address.

When Window 7 is installed create a new entry in the file:

C:\windows\system32\drivers\etc\hosts

like this:

Pointing to localhost.localdomain so Firefox R12 login works.

To ensure everything work try to ping localhost:

SQLDeveloper

If you want to do development then this tool is great. Get it from:

http://www.oracle.com/technology/products/database/sql_developer/index.html

I installed version 1.5.1.

Setup the connection:

I just used the ip address here and it works fine.

Firefox

To run R12 forms and framework you need Firefox 2.

Install Firefox 2 in Win7. I installed version 2.0.0.14. Get it from:

http://www.mozilla.com/en-US/firefox/all-older.html

Allow localhost.localdomain is Firefox security:

and pop-ups:

To start R12 enter the URL:

http://localhost.localdomain:8000/OA_HTML

And you get the login screen:

Java

Java is a must for R12. Check the version required when you have logged in to R12 and click a forms screen

In 12.0.4 it is 1.5.0.13:

Then install Java 1.5.0.13 to ensure you don’t get plug-in issues with R12. Get it from:

http://java.sun.com/products/archive/j2se/5.0_13/index.html

As Firefox only supports one Java plug-in at any one time check the directory for plug-ins:

C:\ > DIR “C:\Program Files\Mozilla Firefox\plugins”

Ensure you only have one Java plug-in here. If it is missing the do this:

C:\ > copy C:\Program Files\Java\jre1.5.0_13\bin\NPJPI150_13.dll C:\Program Files\Mozilla Firefox\plugins

Restart Firefox and now everything should work.

OEL is in reality a Red Hat Enterprise Linux, which is a bit amputated in term of applications and drivers.

The reason for this constellation is OEL 5.3 Supports eBusiness Suite R12 and RDBMS 10g.

Next step is to make Win7 to speak to a R12 installation.

Using
c:> net use x: d:/path
To assign drive.

Copy and paste of files works fine but if you try to install any software from the shared drive or read media it doesn’t work.

Even running WIN7 on top of Vista resulted in errors using shared folders.

Would be nice to resolve this problem…

Until then just copy/paste files from the shared drive to C: and work from there.