Oracle Sub Ledger
Accounting R12
Sicher Global Solutions
SLA (Sub Ledger
Accounting)
Sub-Ledger Accounting (SLA) is functionality introduced by Oracle in
R12 of the Oracle eBusiness Suite.
We will be covering the following Topics in SLA:
What is SLA? (i.e. an introduction to its functionality and concepts)
How does it work? (i.e. system architecture, both process and
configuration aspects)
What can we do with it? (i.e. how it can be used to meet business
requirements)
What does it mean for the end-users? (i.e. reports, inquiries, monthend process and diagnostics)
SLA (Sub Ledger
Accounting)
In R12 the Set of Books concept was replaced with Ledgers; i.e. the 3
Cs became the 4 Cs:
R12 the Set of Books concept was replaced with Ledgers; i.e. the 3
Cs became the 4 Cs:
11i
R12
Set of Books
Ledger
Chart of Accounts
Functional Currency
Calendar
Chart of Accounts
Functional Currency
Calendar
Accounting Convention(SLA)
SLA (Sub Ledger
Accounting)
So for example it became possible to have the following:
Primary Ledger using standard accrual as an accounting
convention
Secondary Ledger - using a cash accounting convention
In this scenario when the user enters a supplier invoice into Accounts
Payable, the following
accounting impacts follow:
Primary Ledger:
Dr Expense (determined by Invoice Distribution)
Cr AP Control
Secondary Ledger:
no accounting impact
SLA (Sub Ledger
Accounting)
To provide this new functionality, Oracle introduced sub-ledger
accounting, which is:
Both a set of accounting rules and an engine to generate the
accounting transactions
A separate product with its own schema (XLA) to which accounting
transactions are posted from each participating sub-ledger prior to being
posted to the General Ledger2.(Although SLA is a separate product, it
may be helpful to think of it as a service rather than a separate
Application, since it is accessed via the existing sub-ledgers)
Participating sub-ledgers include:
Payables, Receivables, Projects ,Assets, Cash Management,
Purchasing ,Cost Management, Process Manufacturing
SLA (Sub Ledger
Accounting)
Using a single engine to derive accounting from all these sub-ledgers,
standardizes the accounting process.
The SLA engine also supports user defined (modified) accounting
conventions which allow users to determine how the sub-ledgers derive
the accounting. The screens used for this are called the Accounting
Methods Builder (AMB). Configurations created via the AMB are much
easier and transparent than equivalent modifications in previous eBS
versions and are more easily supported.
SLA (Sub Ledger
Accounting)
How it Works (Accounting Process):
The following diagram shows how the participating subledgers post through SLA to the General Ledger 4. This
actually has quite significant impacts at Month-End (which
we will come to later in this paper), however the diagram
also indicates that the SLA forms a central transactional
data repository with its own reports and inquiry windows.
PA
CE
AR
PO
AP
SLA
CM
GL
FA
SLA (Sub Ledger
Accounting) (Flow)
LEDGER
SLAM
(Sub ledger Accounting
Method)
AAD
(Application Accounting
Definition)
JLD
(Journal Line Definition)
AMB
(Accounting Methods Builder)
ADR
(Account Definition Rules)
JED
(Journal Entry Descriptions)
JLT
(Journal Line Type)
Event Class
(Invoices, Addition)
Event Types
(INVOICE ADJUSTED ,Addition)
SLA (Sub Ledger
Accounting) (Flow)
SLA: Elements of Journal
(AMB)
JLT : Control journal entry lines such as balance type and summarization
JED: Control the description for the journal entry headers and lines
ADR: Control the derivation accounting flexfield combinations for journal
lines
entry
FA Example
FA Requirement
1. The location value of expense distribution combination needs to be captured
in Asset Cost journal entry
2. The cost center/dept segment value should default 999999 when asset is
retired
Solution 1:
3. Define new JLD (Journal Line Definition) for Event Class = Addition
4. Define new JLT (Journal Line Type) for Addition Cost
3. Define new ADR rule for location segment for Event Class=Addition and
JLT=Addition Cost
Solution 2:
5. Define new JLD (Journal Line Definition) for Event Class = Retirement
6. Define new ADR rule for cost center segment for Event Class = Retirement
and JLT = Retirement Cost
FA Seeded ADR for JLD= Addition JLT = Asset Cost
Segment
Rule Name
Owner
Description
All Segments
Assets Book Default Account
Oracle
Assets Book Default Account
Balancing Segment
Assets Expense Account Segment
Oracle
Assets Expense Account Segment
Natural Account Segment
Assets Categories Cost Account Segment
Oracle
Assets Categories Cost Account Segment
FA seeded Accounting generation
SLM: STANDARD_ACCRUAL (seeded)
1.
Define Custom SLAM by copy from seeded
1.
After Copy (optional Transaction / Accounting COA)
2.
Application Accounting Definition (copy from Seeded)
2.
After Copy (optional Transaction / Accounting COA)
3.
Journal Line Definition (copy from Seeded)
3.
Journal Line Definition (After copy)
4.
Journal Line Types (copy from Seeded)
5. Copy Line Assignments (copy from Seeded)
6. Disable Oracle JLT and activate Custom JLT
7. Journal Line Descriptions (copy from Seeded)
8. Modify Journal Line Descriptions
9. Attach JLD to JLT
10. Modify ADR for Additions
11. Copy ADR
12. Modify ADR
12. Modify ADR
12. Modify ADR - Conditions
12. Modify ADR - Retirement
13. Assign to Custom SLA to Ledger
13. Assign to Custom SLA to Ledger
Cisco Requirements: AP Example
AP Requirement
Make a rule something like if the Expense Distribution is for employees or the
invoice is for employees then only accounts starting with '6% or default 6100
should be allowed in the invoice, otherwise no other accounts will be allowed
Solution:
1. Define new JLD (Journal Line Definition) for Event Class = Invoice
2. Define new ADR rule for account segment for Event Class=Invoice and
JLT=Item Expense
What SLA can do
Above requirement is possible through SLA. Make rules to default values that are
listed out based on some conditions. If any accounts entered other then 6%
series Accounting Program will give you a warning and invoice will not be
accounted
1. Modify Application Accounting Definition
1. Modify Application Accounting Definition
2. Define Journal Line Definition
3 Define Journal Line Type (copy from seeded)
4. Define Account Definition Rules
4. Define Account Definition Rules contd
SLA : Process change
In 11i Balancing entries are created in GL after period close
In 12 Balance entries are created in SLA before period close and when transactions
are accounted
SLA : Definitions
SLAM
is the list of Application Accounting Definitions per sub ledger that can then be linked to the
ledger.
AAD
Application Accounting Definition to form the complete set of rules per event for the sub
ledger.
This summary of the set of rules needs to be validated before it can be linked to the Sub
ledger
Accounting Method for the sub ledger.
AMB
The Accounting Methods Builder (AMB) comprises of three elements:
The Journal Line Type (JLT), the Journal Entry Description (JED) and the Account Derivation
Rule (ADR). It allows a user to create and modify journal entry setups determining the Debit
and Credit
ADR
Account Derivation Rule These are the rules that determine from where an
accounting flexfield
value is taken or how it is derived. Oracle does provide seeded rules, however one can
create
ones own rules to derive accounting flexfield segment values
JLT One of the building blocks of an accounting definition. Journal line types are defined
in the
Accounting Methods Builder and include options necessary to convert transaction data
into subledger journal entries.
JLD A group of line assignments for an event class or event type.
SLA : Benefits
1.
2.
3.
4.
5.
6.
7.
The ability to generate the accounting entries for respective sub ledgers in
Draft mode or Final mode.
Automate account generation, which can be based on a number of inputs
Enables compliance with multiple accounting requirements concurrently in a
single instance or even across database instances.
Journal Entry Description can be tailored to include the information the
business requires for downstream processing
Accurate Accounting: SLA specifically addresses those accounting issues that
relate to a string of events or a transaction flow by remembering the original
account that was used in the initial event (i.e., invoicing), and ensuring that the
same account is reversed during the subsequent event (i.e., payment).
Online Accounting: Launch accounting directly from transactions window to
initiate real-time, single step posting to all relevant ledgers (primary,
secondary and reporting ledgers)
Preview Accounting: Allowing you to preview the journal entries impacted by
the transaction before actually post it.
Controlled Accounting: Designate any account as control account, this flag
prevents GL manual posting from posting
SLA : Comparison
Release 11i
Sub ledger modules
Oracle Payable
Oracle Assets
General Ledger
Oracle Purchasing
Release 12 Accounting Model is separated from Transactions
Sub ledger modules
Sub ledger Accounting
Oracle Payable
AP Rules & ADR
Oracle Assets
OA Rules & ADR
Oracle Purchasing
PUR Ruels & ADR
General Ledger
SLA : AMB Components
SLA: Setup Flow
(Bottom approach)
SLA: Multiple Accounting
Representations
