Sub-Ledger Accounting

Deep Drive

Jeannie Dobney, independent consultant

& Alyssa Johnson, solution architect,
Solution Beacon
Objectives

• Reflect on what is now understood about

Sub-Ledger Accounting (SLA)
after 3 years of R12 experience
• Rather than reinventing the wheel,
highlight valuable existing resource material
• Offer ‘tips’ from our experience
Key Resources
• Oracle’s SLA Implementation Reference manual
• OAUG’s GL SIG series of 3 SLA presentations by FMT
and Oracle’s Rob Zwiebach
– Jan 20, Jan 27, & Feb 3 in 2010
• Alyssa Johnson (Solution Beacon) presentations:
– Oracle EBS Release 12 Subledger Accounting; What It
Is, What It Does, How It Works (April 2008), and
– Transitioning from Account Generators to the R12
Subledger Accounting Engine (Collab 09)
• Melanie Cameron’s SLA whitepaper for the
OracleContractor’s network
• Metalink / MOS documents (white paper has details)
Agenda
1. What is SLA?
2. How does SLA work?
– Process
– Configuration
3. What can we do with it?
– Examples of meeting business requirements
4. What does it mean for the end-users?
– Reports,
– Inquiries,
– Month-end
– Diagnostics
1. What is Sub-Ledger Accounting?
• A new product in R12 and a major change,
although it may be almost transparent to end-
users
• Both accounting rules and accounting engine
• Centralized transaction repository
• Schema XLA, through which transactions
pass to GL
• Accessed via existing sub-ledgers (mostly…)
What is SLA? (continued)
• SLA allows multiple parallel accounting
representations of the same transaction
• Supports user-defined accounting rules (to enable
compliance with multiple geographic, legislative,
or industry requirements)
• A standardised accounting engine deriving
accounting from participating sub-ledgers:
– Payables -- Receivables
– Projects -- Assets
– Cash Management -- Purchasing
– Cost Management -- Process Manufacturing
R12: from 3 to 4 C’s
Set of Books (11i) Ledger (R12)
Chart of Accounts Chart of Accounts
Functional Currency Functional Currency
Calendar Calendar
Accounting Convention
R12: From Set of Books to Ledgers
Separation of Transaction and
Accounting: Simple Example
Primary Ledger: accrual
Secondary Ledger: cash

Transaction: Invoice entry

Accrual Ledger:
Dr Expense (determined by Invoice Distribution)
Cr AP Control
Cash Ledger:
No accounting generated
 Separation of Transaction and
Accounting (cont)

Image is reproduced from p.8 of Metalink Note 986783.1 - SLA Business Benefits
2. How does SLA Work?

• Process (Create Accounting)

• Configuration
– Sub-Ledger Accounting Method (SLAM)
– Accounting Methods Builder (AMB)
– Application Accounting Definitions (AAD)
– Account Derivation Rules (ADR)
– Journal Line Types (JLT)
– Suffocation by TLA…
Accounting Process

PA CE PO

AR AP

SLA
CM FA

GL
Create Accounting
 Accounting Process
GL tables

User enters and processes

GL Interface
transactions
SLA tables Transfer to GL
Journal Import
XLA_Events
XLA_AE_Headers
Sub-Ledger’s GL JE Batches
GL_JE_Batches
XLA_AE_Lines
(distributions GL_JE_Headers
default source)
GL_JE_Lines
XLA_Distribution_Links

Create Accounting concurrent

process (SLA engine uses the Post Journals
Accounting Method to generate
the correct Accounting)

SLA maintains balances for: GL_Balances

- Open Accounts
- 3rd party control accounts
- Supporting References
Draft Mode: Delete Option
Alternative
View
(from Note 793634.1
 Sub Ledger Accounting Processing

Accounting
Configurations
Subledger
Transactions Journal Entries

GL
Accounting Journal Entries
Program and Balances

Accounting Events Subledger

Balances
Journal Entry Setup

Sub-ledger SLA

This slide is replicated from Cost Accounting As You Want It ─ EBS R12 Cost Accounting with SLA by Diane Streubel and Douglas Volz
From Sanjit Anand’s blog http://www.oracleappshub.com/release12/subledger-accounting/sub-ledger-accounting-technical-perspective/
Remember:
The Transaction is no longer
necessarily the Accounting Entry
Transitioning from Account Generators?
GL tables

User enters and processes

GL Interface
transactions
SLA tables Transfer to GL
Journal Import
XLA_Events
XLA_AE_Headers
Sub-Ledger’s GL JE Batches
GL_JE_Batches
XLA_AE_Lines
(distributions GL_JE_Headers
default source)
GL_JE_Lines
XLA_Distribution_Links

Create Accounting concurrent

process (SLA engine uses the Post Journals
Accounting Method to generate
the correct Accounting)

SLA maintains balances for: GL_Balances

- Open Accounts
- 3rd party control accounts
- Supporting References
SLA Architecture
SubLedger Accounting Method
SubLedger Accounting Configuration

Accounting Methods Builder (AMB) windows can

be accessed from the set-up menu in the
participating sub-ledgers i.e. SLA is a service
not a separate responsibility
SLA
SetUp
menu
Example: Standard Accrual Method

Link to
Acc’ing SetUp Mgr
AP Application Acc’ing Def.
Cash Basis Comparison
Header Assignments
Line Description Assignments
Journal Line Descriptions
Description Definition
Account Derivation Rules
Sources
Conditions
Mapping Sets
AMB Review
AMB Review
 Tip: Posting in Detail / Summary
Q. How do we control whether a sub-ledger posts in
summary or detail?
A. Journal Headers from Subledger Acc’ing Options,
Journal Lines from AMB
Refer MOS Note 876190.1
GL Journal Entry Summarization JLT -Transfer to GL Expected behavior

Summarize(By GL Date or Period) Summary Summarized at both GL_JE_HEADERS and GL_JE_LINES

Summarize(By GL Date or Period) Detail Summarized at GL_JE_HEADERS, detail GL_JE_LINES

No Summarization Detail Detailed at GL_JE_HEADERS and GL_JE_LINES

No Summarization Summary Detailed at GL_JE_HEADERS and GL_JE_LINES

SLA: Accounting Options
AMB - JLT
Tip: Understanding Events
Events (continued)
3. How Can SLA be Used to Meet
our Business Requirements?
• GL users want AR invoice journal line descriptions
that reflect the invoice source (i.e. the feeder
systems).
• Differentiate AR Control account for products and
services
• Asset disposals charged to a specific cost centre
(not 000). In 11i this requires a Workflow
developer to customise the Account Generator.
(How to do this is illustrated in Alyssa Johnson’s
paper Transitioning from Account Generators.)
How Can SLA be Used to Meet our
Business Requirements? (cont)
• Purchase Price Variance by product line
described by Streubel and Volz in their paper
Cost Accounting As You Want It ─ EBS R12
Cost Accounting with SLA. (*)
• Metalink Note 458375.1 includes a case
study where the AP liability account is cost
centre specific and the cost centre value
should match the item distribution.
(*) Paper available from Doug Volz’ website: www.volzconsulting.com/resources.html
alternatively the example can also be found in Herve Yu’s SLA presentation that can be
found at http://discretesig.oaug.org/member/DiscreteSIG_Jun09_Costing_SLA.pdf.
How Can SLA be Used to Meet our
Business Requirements? (cont)
• The GL SIG’s excellent series on SLA includes
a discussion of how Automatic Offsets are
implemented in R12. This provides a useful
template for similar requirements e.g. making
the balancing segment of the accrual account
mirroring the balancing segment value in the
expense account. SLA supports this using the
same principle used for automatic offsets.
• There are a series of other excellent examples
in the GL SIG’s SLA presentations
Refer FMT & Rob Zwiebach’s Introduction to SLA for the GL SIG January 27, 2010
 Automatic Offsets Example

Example is from GL-SIG SLA presentation series from FMT Systems and Oracle’s Rob Zwiebach
Automatic Offsets Example
Automatic Offsets Example
Automatic Offsets Example
Tip: Document Changes & Test!
Other Useful Functionality
• Supporting Reference Balances
for management reporting
• Third Party Control Accounts Balances
(for suppliers and customers)
SLA maintains balances by third party
• Open Account Balances
• Accounting Sequences
• Replacement Accounts
Replacement Accounts
Third Party Control Accounts
4. What does SLA mean for users?

• New and / or changed reports

• New Inquiry pages
• Changed month-end process
• Diagnostics
SLA Reports
• Journal Entries Report:
Listing of sub-ledger journal entries
• Account Analysis:
Listing of beginning and ending balances from GL with
merge of subledger and GL details
• Open Account balances (a.k.a. Trial Balances)
• Third Party Balances Report,
balances by third party control account and third party
• Period Close Exceptions Report,
listing of transactions, sub-ledger journal entries that
have not yet been posted to GL
This simplified listing is from FMT & Rob Zwiebach’s Introduction to SLA for the GL SIG Feb 3, 2010
SLA Reports: Using BI Publisher
SLA Inquiry Pages
Drill Down from General Ledger
SLA Inquiry Pages
SLA Inquiry Pages
Access to SLA Data
Warning: Sub-Ledger Journals
Month-End Impacts

• New reports and inquiries will be used

• Review Note 961285.1 - R12: Period-End
Procedures for Oracle Financials E-Business
Suite
• Oracle position SLA as facilitating a smoother
period close and easier reconciliation
• Recommendation:
Include month-end process and use of
changed reports in your UAT
Slide is reproduced from presentation Oracle Financials Release 12 Close Process and Reconciliation by Helle Hennings, Product
Strategy Director, Financials Product Strategy and Joe Gum, Senior Product Director, Financials Product Strategy
Diagnostics
1. Set the profile option: SLA Enable Diagnostics
to Yes
2. Submit the Create Accounting program which
then also populates the diagnostic tables.
3. Submit Transaction Objects Diagnostics to view
the diagnostic report.
4. Reset profile option: SLA Enable Diagnostics to
No
5. The System Administrator submits the Purge
Transaction Objects Diagnostics concurrent
request.
Diagnostics

Refer Note: 414094.1 - Diagnostic Framework Overview for Subledger Accounting

Diagnostics
Diagnostics
SLA Upgrade Issues
• Non-trivial…
• SLA: Upgrade Modes
– No Upgrade
– Partial upgrade:
Some historical data is upgraded; Determine the range of periods
when you submit the SLA pre-upgrade
– Full upgrade
References:
– Oracle Applications Upgrade Guide: Release 11i to Release 12
(part # B31566-01)
– Also Metalink, e.g. Note 604893.1 - R12: FAQ for the SLA
Upgrade
But Wait, There’s More…
• Import / Export of SLAMS
• API to create journal entries (e.g. for legacy
systems)
• Business Flows
• Pre- and Post-Accounting Programs
• Multi-Period Accounting
• Profile Options:
– SLA: Accounting Methods Builder Context
– SLA: Enable Data Access Security in Subledgers / GL
– SLA: Enable SQL Trace
Don’t Miss
Alyssa Johnson presenting
Transitioning from Account Generators to
SLA
Monday 19 April at 1:15pm in Lagoon I
Conclusion & Questions
• Thank you for joining us
• Your questions are welcome:
jdobney@bigpond.com
ajohnson@solutionbeacon.com
• Updated whitepaper and slides
can be found at jdobney.com