How Do You Account for That – Oracle Payables 11i (1)

8/10/2019 How Do You Account for That Oracle Payables 11i (1)

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How Do You Account for That? Oracle Payables 11i

An Oracle White Paper

March 2

!e"ise# $o"e%ber 22

&'&()T*+& O+&!+*&W

In release 11i, Oracle Payables introduces a new accounting model. How do you account for that?

This white paper covers the business reasons for this change, reviews the new functionality, and

provides a brief technical overview. This paper should be of use to anyone who needs to learn how

to account and close a period in 11i. It can also help current Oracle Payables users plan for an 11 i

upgrade.

*$T!OD)(T*O$

In release 11i, Oracle Payables introduces a new accounting model to support the creation andretention of accounting entries in the Payables subledger. This paper discusses why this change was

made, and how it affects the accounting and period close processes in Payables. This paper is

primarily an overview of the new functionality, however, a review of the functionality in previous

releases is provided as a basis for reference. !amples of the accounting entries created by the new

model in release 11iare provided. " brief technical overview of the #ey data model changes is

provided at the end of this paper.

This paper should be most useful to current users of Oracle Payables who are interested in

understanding the accounting changes made in release 11iand who want to plan for their upgrade to

the new release.

,(OP& O- TH*, PAP&!

This paper describes accounting in the Oracle Payables subledger and integration with Oracle

$eneral %edger.This paper does not describe behavior of accounting entries that are generated using

the $lobal "ccounting ngine. In addition, accounting transactions where Oracle Payables

integrates with other subledgers are not in the scope of this paper. Transferring accounting data to

non&Oracle general ledgers also is not in the scope of this paper. " good familiarity with the Oracle

Payables product is assumed as features referenced are not described in detail unless they are new to

the accounting model.

This paper assumes accrual basis accounting for its discussion. 'here relevant, a mention of theaccounting impact for cash basis accounting is included, but only where specifically noted.

Other features which have accounting impact but are outside of the scope of this paper include(

ncumbrance accounting

"utomatic Offsets

"ccrual on receipt

Ta! accounting

)uture dated payments


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'here relevant, a mention of the accounting impact of one of these features may be made, but only

where specifically noted.

How Do You Account for That? .usiness !easons .ehin# the (han/e

The new accounting architecture that Oracle Payables has introduced with release 11 iallows formore fle!ibility as new features are introduced in future releases. However, these changes in 11 i

were not made *ust for the purpose of improving the product architecture. There were many

functional enhancements in the area of accounting which Oracle Payables development had been

as#ed to ma#e, and many of them were not possible without this #ind of architectural foundation.

)or e!ample, there were desired enhancements in the area of prepayment functionality that needed

to be made. Prior to release 11i, the application of a prepayment created some less than desirable

accounting such as creating an accounting entry for the cash account. This and other problems could

be addressed with the new accounting model.

"nother area which needed enhancement was the future dated payment functionality. Issues

included the inability to cleanly account for the maturity of a future dated payment, and the inabilityto simultaneously use the future dated payment feature and create accounting when a payment was

cleared or reconciled.

$eneral improvements needed to be made to the accounting that Payables created. )or e!ample, in

release 11i, there is now a single accounting entry created to accounts such as liability, cash

clearing, cash, and discount +if system level. Prior to this release, one accounting entry was created

to these accounts corresponding to each invoice distribution. This was somewhat cumbersome and

made reconciliation more difficult for users.

"nother business reason behind the change was the support of improvements in accounting for

currency gains and losses. -ome countries needed to be able to account for gain or loss only at the

time of payment clearing. Prior to the new accounting model in release 11i, this would have beenvery difficult to support. "nother enhancement in this area is support for the calculation of gain or

loss at the desired level. Oracle Payables can now support the calculation at the payment level or the

payment line level.

This is not an e!haustive overview of all the business reasons for the introduction of this new

accounting architecture, but it should serve to point out that there are some important benefits to

users of the Oracle Payables product. This change is also consistent with the future direction of

Oracle )inancials. The new strategy is to develop a corporate global subledger accounting standard

so Oracle )inancials can be consistent in creating the sub&ledger accounting entries. ustomers

using Oracle "pplications will be able to accurately create subledger accounting entries by

following a corporate global subledger standard. Oracle Payables development will also be doing

more wor# in this area to improve and enhance the architecture it now has in release 11 i.

!e"iew of Accountin/ in Prior !eleases

" review of the way accounting wor#s in Payables prior to release 11iis included here to serve as a

basis for understanding the new accounting model discussed in the following sections. 'hen there

are references to specific forms, fields, reports, or programs, they are the release 11 names.

/efore 11i, there is no accounting in the Payables subledger. "ccounting information is inherent in a

Payables document, but there is not always a way to see the information +for e!ample, an invoice

price variance for a purchase order matched invoice. "ccounting for Payables transactions iscreated by a concurrent process & the Payables Transfer to $eneral %edger program. This is a very

comple! program which pulls information out of the transaction tables, creates accounting entries,


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and places them in the gl interface. )rom there the general ledger process 0ournal Import creates

*ournal entries and imports them as unposted *ournal entries into Oracle $eneral %edger.

There are some setup options to point out which control various aspects of the accounting which is

created.

In the "ccounting region of the Payables Options setup window there are two options in the ash

learing region. The first is called "llow 2econciliation "ccounting. If this is enabled, it means

that if Oracle ash 3anagement is used to clear and4or reconcile payments, accounting entries are

created for those reconciled payments.

The other is called "llow )uture Payment 3ethod. It is not possible to select both of theseoptions because future dated payments use the account setup as the cash clearing account. "lthough

future dated payments are outside the scope of this paper this is worth pointing out since this is not

the case in 11i. In 11ia separate account is supported for future dated payments so this option is not

needed.

"lso worth noting in this "ccounting region is the setup area called 0ournal ntry reation. This

setup controls defaults for the submission of the Payables Transfer to $eneral %edger process for

how it creates entries in the gl interface. )or the accounts in this setup region it is possible to specify

an "udit or 5o "udit option. The "udit option means that the accounting information is created

in detail in the gl interface, and this in turn means that drill down is available from the *ournal

entries in Oracle $eneral %edger bac# to the details in the Payables subledger. The 5o "udit option

creates summary entries, and drill down is not available. +5ote that there is a setup step in Oracle

$eneral %edger to enable drill down. The Import 0ournal 2eferences option must be enabled in the

0ournal -ources window for Payables.

"lthough the drill down functionality provides some good accounting detail there is not the

opposite functionality in Payables. That is, it is not possible to in6uire on a particular transaction

and easily see the accounting for that transaction.

The process to close an accounting period has also changed in release 11i, so a review of that

process is also provided here. The rules to close a period in Payables prior to release 11iare(

"ll payment batches must be confirmed

"ll invoices must be transferred to general ledger "ll payments must be transferred to general ledger


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/efore invoices can be transferred to general ledger they must be approved by the Payables

"pproval process. /efore payments can be transferred to general ledger they must pass through the

onfirm process. Typical steps to close a period in Payables are( 7

Import all invoices and4or e!pense reports from interface tables

2un "pproval

2eview the Posting Holds 2eport to identify invoices which cannot be transferred to generalledger

orrect the invoice transactions7 rerun "pproval

2eview the !pense 8istribution 8etail 2eport +-ome users review this report for particular

accounts before they close a period7 they can identify and correct any issues prior to their

close

onfirm any outstanding payment batches

2un the Payables Transfer to $eneral %edger program

Optionally run the 9nposted Invoice and Payment -weep +some accounting rules allow this

& others do not

lose the Payables period

2econcile

How Do You Account for That? O"er"iew of $ew Accountin/ Mo#el in 11 i

5ow in release 11i, Oracle Payables creates and stores accounting entries in the subledger.

"ccounting entries are created based on a particular accounting event, for e!ample, the creation of

an invoice, or the payment of an invoice. These accounting entries are available for view and

analysis even before they are transferred to the general ledger. There is a new program to create the

accounting entries & the Payables "ccounting Process.

The Payables Transfer to $eneral %edger is a new program. "lthough it retains the same name, it is

a new, much simpler program. It is now truly *ust a transfer program. It ta#es the accounting entries

created in Payables and transfers them to the general ledger interface, with the capability of doing

summari:ation if desired. The general ledger 0ournal Import process remains the same.

There is some new and some changed setup for how the accounting controls and options wor# in

release 11i. 5ew forms are provided to view the accounting in the subledger and to correct

accounting creation errors if necessary. 8etails on all of these new and changed features are

provided in the following sections.

,etup

Oracle Payables has some new and some changed setup which controls how accounting wor#s in

release 11i. The core of the changes is in the Payables Options form in three regions( "ccounting

3ethods, Transfer to $%, and Payment "ccounting.

"ccounting 3ethods


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This region corresponds to the "ccounting region in release 11. 5otice that the section with theaccount audit options has been removed. 'ith the new accounting model, these options are no

longer needed. 'hen the accounting entries are transferred to the gl interface, a lin# is

automatically created. This means that full drill down to the payables accounting entries is always

available from Oracle $eneral %edger, no matter the level of summari:ation. +5ote that the same

Import 0ournal 2eferences option in Oracle $eneral %edger must be enabled to allow drill down.

The upgrade from a prior release to 11i retains the setup in place for the accounting method4s.

Transfer to $%

This new region controls the default values for the parameters of the Payables Transfer to $eneral

%edger program. This assists users in ensuring that they consistently transfer their accounting

entries to the general ledger interface in the same way. If the "llow Override at Program

-ubmission parameter is disabled, then an accounting manager can safely delegate the submission

and monitoring of this process to staff while still ensuring control.

"lso, those who use the 32 +3ultiple 2eporting urrencies feature in release 11i can transfer

accounting entries for the reporting sets of boo#s and the primary set of boo#s at the same time.Payment "ccounting


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This new region controls various options for the accounting of payments. The "ccount for Paymentoption controls the timing of when accounting is created for a payment. There are three options

available(

'hen Payment is Issued

'hen Payment lears

or both can be selected

If both options are selected then the same functionality is provided as in prior releases when the

"llow 2econciliation "ccounting feature was enabled. That is, accounting will be created at both

the time the payment is issued and at the time when the payment is cleared and4or reconciled in

Oracle ash 3anagement. The upgrade from a prior release to 11i enables both of these options if

the "llow 2econciliation "ccounting feature was enabled.The "ccount for $ain4%oss setup controls the timing of when accounting is created for the

recognition of gain or loss on a payment transaction.

There are three options available(

'hen Payment is Issued

'hen Payment lears

or both can be selected

This setup has dependencies on the "ccount for Payment setup and vice versa. )or e!ample, if the

"ccount for Payment 'hen Payment is Issued option is not chosen then the "ccount for $ain4%oss

'hen Payment is Issued can not be chosen.

The alculate $ain4%oss setup controls the calculation level for the accounting entry for any gain or

loss on a payment transaction. There are two options available(

)or ach Invoice

)or Total Payment

Prior to release 11i, Payables did not offer this choice. $ain or loss was calculated for each invoice

on a payment. The upgrade from a prior release does not automatically choose one of these options

& it is left to the user to determine what is appropriate for his or her business.

" detailed discussion of the setup relevant to )uture 8ated Payments is out of the scope of this

paper.

Accountin/ &"ents

The 11iPayables accounting model uses the new concept of accounting events. "ccounting events


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are business events which have fiscal significance within Oracle applications.ach accounting event

relates to a single document or transaction +e.g. invoice or payment.These accounting events,

which are captured and recorded real&time, are used to create subledger *ournal entries.The type of

event controls the accounting entries that are created for a transaction and how that accounting

appears in the subledger.

The eleven accounting events in Payables are divided into two document classes, invoices and

payments. ;ou can specify a document class when you create or view accounting entries.

The accounting events for the invoice document class are(

Invoice vent

Invoice "d*ustment vent

Invoice ancellation vent

Prepayment "pplication vent

Prepayment 9napplication vent

The accounting events for the payment document class are(

Payment vent Payment 3aturity vent

Payment "d*ustment vent

Payment ancellation vent

Payment learing vent

Payment 9nclearing vent

Invoice vent

The invoice event is captured when a new invoice is validated. This event creates accounting entries

for each of the accounts associated with the invoice distributions and to the liability account of the

invoice.

The accounting entry created for a simple invoice with one distribution in the functional

+accounting currency is(

"ccount 8ebit redit

harge 1


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harge +o =


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" first payment is made for the invoice in the amount of 1


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ash learing 1


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2eali:ed

%oss +>C

> payment with a 1D discount ta#en +discount charged to a

system account(

"ccount 8ebit redit

"P %iability >

8iscount Ta#en 1D

5ow at the time of payment clearing the accounting entry created is(

"ccount 8ebit redit

ash learing 1D>

ash 1D>

ffectively this accounting moves the cleared or reconciled payment out of the cash clearing

account and debits the cash account now that the cash has been issued by the ban#.


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This accounting event may also handle any accounting for currency gains or losses. If setup is such

that there is no accounting for gain or loss at the time a payment is issued, but rather only at the

time a payment clears, then the accounting for the payment clearing event creates the necessary

accounting entries.

In the foreign currency e!ample in the invoice event section, the invoice was for >


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Payables Accountin/ Process

Oracle Payables has introduced a new concurrent program in release 11ito create the accounting

entries for the subledger transactions. These accounting entries are created from the accounting

events which have been captured at transaction time. The new concurrent program is called the

Payables "ccounting Process. The process creates accounting entries in all sets of boo#s. 'hen the

program runs, it produces an output report that has two sections & an audit and an e!ceptions

section. The audit section shows the detail of all accounting entries created by the process. Thee!ception section shows the detail of any accounting entries that were created with errors. This

might happen if the process finds that an account has been de&activated in general ledger after the

time it was entered in the Payables subledger.

Program parameters include a date range of transactions to be accounted, and the document class to

be accounted +invoices, payments, or both. "n optional Falidate "ccounts parameter can be

selected. If this parameter is selected and if an accounting entry has an account that is no longer

valid in the general ledger, then the accounting entry will receive an accounted with error status. It

is a good idea to select this option because accounting entries with errors can be reviewed and

corrected before submitting the Payables Transfer to $eneral %edger process. "nother optional

parameter can summari:e the audit section of the report. This is useful when accounting for largevolumes of data that does not need to be reviewed in detail.

The process wor#s as follows. )irst it chec#s the accounting rules in the setup options. Then it loc#s

the transaction data to be accounted, based on the parameters submitted to the concurrent program.

The ne!t step is the creation of the accounting entries for each accounting event. The program

creates accounting entries in the same order as the events occurred. )or e!ample, before a payment

can be accounted, the invoices on the payment must be accounted. "fter the accounting entries are

created, they are validated against general ledger accounts if that option was chosen. Then the

transactions are updated as accounted and the process is complete.

One other thing to mention about the process is that when it creates the accounting entries it assigns

a *ournal category to each entry. 'hen the Payables Transfer to $eneral %edger is run it wor#s bytransferring *ournal categories. The details are e!plained in the section about transferring

accounting entries to gl.

%i#e other concurrent programs, the Payables "ccounting Process can be set up to run on a periodic

basis. The business needs of the accounting department should be reviewed to determine how

fre6uently to run this process. 5ow that the Payables Transfer to $eneral %edger simply transfers

created accounting entries, the Payables "ccounting Process must be run before the transfer can be

run. This means that as often as the transfer was run before, now both the accounting process and

the transfer need to be run. +The need to account and transfer more often is li#ely if another Oracle

product such as Oracle "ssets is used. It re6uires that Payables data be transferred to general ledger

before it can flow to its interface.There are two ways to lin# these processes, the accounting and transfer to gl, to simplify their

submission. One way is within the Payables "ccounting Process. Two parameters can be used(

-ubmit Transfer to $% and -ubmit 0ournal Import. If ;es is chosen for the -ubmit Transfer to $%

parameter, then the options set up in the Transfer to $% region of the Payables Options window are

called for this submission. /ased on those options it may or may not be possible to choose to submit

0ournal Import. +-ee the -etup section of this paper for detail. The second way is to create a

2e6uest -et using standard Oracle "pplications functionality.

Oracle Payables also provides the option to create accounting for a single transaction online from

the Invoices and Payments windows, or for an invoice or payment batch from the Invoice /atches

and Payment /atches window. This option may be helpful when in a testing phase or if a specifictransaction needs special processing.


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$ew Accountin/ *n0uiry an# )p#ate -or%s

5ow that Oracle Payables creates and stores accounting in the subledger it is also possible to

in6uire on and view the accounting created for payables transactions. There is a new form provided

in release 11iwhich shows a variation of accounting information depending on where the form is

accessed.

" new main menu heading has been added to the Oracle Payables navigator called "ccounting.One of the options in this menu is Fiew "ccounting %ines. 'hen this is chosen, the new Fiew

"ccounting %ines window opens. 'hen called from the navigator it is possible to in6uire on any

range of accounting data, such as across documents, periods or accounts.

The data retrieved is displayed in the form of a balanced accounting entry. It can also be viewed in aT&account format or in an alternate currency if using reporting sets of boo#s.

Fersions of this same window are available in the main Payables transactions windows & Invoices

and Payments. If opened in the Invoices window to see the accounting for an invoice transaction,

the window title is Fiew Invoice "ccounting. If opened in the Payments window to see the

accounting for a payment transaction, the window title is Fiew Payment "ccounting. "ll of these

windows use the standard Oracle "pplications folder functionality, allowing them to be easily

modified to best suit the typical in6uiry needs of a business.

There are a few fields to point out on the screenshot of this in6uiry window. In the lower right hand

region there is a field called vent Type. This displays the accounting event that generated the

particular accounting line being viewed. "lso in that same area is a field called Transferred to $%.This displays a ;es or 5o value depending on whether or not the accounting line has been

transferred to the general ledger interface.

This last field is useful to point out because this information is no longer found on the main

Invoices window. In prior releases there was a field in the Invoices window called Posted. It

would display ;es, 5o, or Partial +if part of the invoice had been transferred to general ledger. This

terminology was a bit problematic because what it really meant was whether or not the accounting

for the invoice had been transferred to the general ledger interface. It did not truly mean that the

accounting had been posted. In release 11i, Oracle Payables has tried to move away from using the

terms post or posted whenever possible and instead refers to accounting as transferred to

general ledger. This has been done in order to be more precise about what has happened with the

Payables transaction data.

5ow in both the Invoices and Payments windows there is a new field called "ccounted. The value


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in this field shows as ;es, 5o, or Partial. This helps indicate that there is accounting available

for view on a transaction. "long with this the Posted field in the 8istributions subwindow of the

main Invoices window has been renamed "ccounted. 3ost rules in prior releases about whether

or not a posted invoice or payment could be ad*usted now apply to an accounted invoice or

payment.

"s covered in the section on the Payables "ccounting Process, sometimes an accounting entry can

be created with an accounting status of rror. In this case there is a new form available to allowcorrection of the error. The form can be accessed from the navigator under the new "ccounting

menu heading. The menu path and window name are the same & 9pdate "ccounting ntries.

Typically this form is used when the Payables "ccounting Process is run with the option to

Falidate "ccounts. If the process finds that any of the accounts are not valid in general ledger then

the accounting entries are created with an error status, and appear on the e!ceptions report. The

report is reviewed and decisions are made as to how to correct the accounts. Then this new form is

opened and the correct account information is entered in the blan# account field.

The 9pdate "ccounting ntries form can also be used as an in6uiry form if desired.

"lthough encumbrance accounting is outside the scope of this paper, one enhancement to point out

in this area is a new in6uiry window made available in release 11ito view the encumbrances for a

particular invoice. The new window is called Fiew ncumbrances and can be accessed via the

navigator in the new "ccounting menu area. It can also be accessed via the Tools menu option when

in the Invoices window and in6uiring on a particular transaction.

This new window gives users better visibility into the accounting for their encumbrance entries.

This type of in6uiry was not available in Oracle Payables in prior releases.

Transferrin/ Accountin/ &ntries to

"s already noted, Payables Transfer to $eneral %edger is a new process designed to transfer and

optionally summari:e the accounting entries in the Payables subledger to the general ledger

interface.

The process wor#s by transferring accounting data in a selected date range and in a selected *ournal

category. The accounting entries are assigned a *ournal category at the time they are created. Thiscategory can be viewed in the accounting in6uiry windows. There are three *ournal categories(

Purchase Invoices, Payments, and 2econciled Payments. "ll of the invoice accounting events are


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created with a *ournal category of Purchase Invoices. "ll of the payment accounting events, e!cept

for the payment clearing and the payment unclearing events, are created with a *ournal category of

Payments. The payment clearing and unclearing events are created with the *ournal category of

2econciled Payments. There are several differences between the program parameters in prior

releases and the parameters in release 11i. " new parameter & Transfer 2eporting /oo#+s & has

been added to simplify the transfer process if 32 +3ultiple 2eporting urrencies is used. The

Post Through 8ate parameter has been replaced by two parameters & )rom 8ate and To 8ate.The To 8ate parameter used alone wor#s *ust li#e the old parameter. However, now the two

parameters can be used together to transfer a more precise range of accounting entries. The 0ournal

ntry ategory parameter was renamed to the more accurate 0ournal ategory. The list of values

displayed is the list of the three types of Payables *ournal categories. " new parameter, Falidate

"ccounts, chec#s the accounting entries against the current account status in general ledger. If

invalid accounts are found, the entries are not transferred. If this option is not used, then 0ournal

Import automatically validates the accounts. "ll of the "udit45o "udit choices for all of the

account type parameters have been replaced by one parameter called Transfer to $% Interface.

Options for this parameter are( In 8etail, -ummari:e by "ccounting 8ate, and -ummari:e by

"ccounting Period.

Once the data is transferred to the general ledger interface, the process remains the same. The

0ournal Import process ta#es the data in the interface and creates unposted *ournal entry batches,

headers, and lines in Oracle $eneral %edger. )rom there the *ournal entries can be posted to update

the account balances.

2elease 11ioffers enhanced drill down capabilities from Oracle $eneral %edger to the subledgers.

"s mentioned earlier, it is now possible to transfer all accounting entries in summary to gl, while

still retaining the ability to drill down from all accounts. 'hen viewing a *ournal with the source of

Oracle Payables, drill down to Oracle Payables can be chosen. " new window has been created for

the drill down, and the window title and the information displayed vary depending on which *ournal

category is being reviewed. The three window titles are( Payables Invoice "ccounting +from the

Purchase Invoices category, Payables Payment "ccounting +from the Payments category, andPayables 2econciled Payment "ccounting +from the 2econciled Payments category.

"ll of these windows use the standard Oracle "pplications folder functionality, allowing them to be

easily modified to best suit the typical in6uiry needs of a business. )rom these windows it is simple

to drill down to more detail & to view the transaction or to view the transaction accounting.


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!eports

-ince the new accounting model affected all of the accounting in Oracle Payables, any reports that

displayed accounting information in prior releases were reviewed and changed as needed. -ome

new reports were needed to support the new accounting model. "nd some reports were made

obsolete. " list of obsolete reports can be found in the technical overview section. The other reports

are discussed here.

5ew 2eports

Payables "ccounting Process 2eport

This report is automatically produced by the Payables "ccounting Process. The audit section of the

report shows the detail of the accounting entries created by the process. The e!ceptions section of

the report shows the detail of any accounting entries created with an error. It is possible to run the

report in a summari:ed version in which case the audit section shows totals only.

Payables "ccounting ntries 2eport

This report is similar to the output produced by the Payables "ccounting Process7 however it can be

run on its own to report on accounting entries that meet specific criteria. It allows greater fle!ibilityin reporting & for e!ample it can be run *ust for accounting entries that have or have not been

transferred to general ledger. It is also possible to run this report to get the details of accounting

entries created by a particular run of the Payables "ccounting Process. -imilarly, this report can be

run to see the detail of what accounting entries were transferred to $% during a particular run of the

Payables Transfer to $eneral %edger program.

Payables Transfer to $eneral %edger 2eport

The new transfer program automatically produces report output. It has a summary section which

gives totals of the accounting entries transferred to the gl interface. It has two sections which show

e!ceptions( one section shows accounting entries that could not be transferred because they were in

an error status, and the second shows accounting entries that were accounted with no problem butare now unable to be transferred due to a discrepancy between the accounted account and the

account in the general ledger.

This report does not produce an audit section of the detail that has been transferred to the general

ledger. If that information is needed, then the Payables "ccounting ntries 2eport can be run for a

particular submission of the Payables Transfer to $eneral %edger to get the audit detail.

The report output from the new transfer replaces the "ccounts Payable 0ournal ntry "udit and

!ception 2eports.

9naccounted Transactions 2eport

This new report is available to help review problems with invoices and payments which can nothave accounting created for them due to some problem. It will be useful to review this report after

running the Payables "ccounting Process in order to see what transactions could not be accounted

and why.

The report is organi:ed by the reason that accounting can not be created. )or e!ample, invoices

must be validated by the Invoice Falidation process before they can be accounted. -o invoices that

have not yet been validated are grouped together on this report with the e!ception of 5ot

Falidated. This report also shows transactions that have holds that do not allow accounting. 5ote

that holds which did not allow posting in prior releases now do not allow accounting in release 11i.

This report replaces the Posting Holds 2eport. It improves upon the old report in several ways. One

way is that it shows both invoice and payment transactions rather than *ust invoices. )or e!ample, ifa payment can not be accounted due to a missing e!change rate, that transaction is identified by this

report.


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Payables "ccount "nalysis 2eport

This report was created to assist with review of accounting created in the Payables subledger and to

assist with reconciliation of accounts to the general ledger. It can be submitted for an accounting

date range and for a full account segment range.

This report replaces the !pense 8istribution 8etail 2eport. The new report does not need a setup

form as the !pense 8istribution 8etail 2eport did.hanged 2eports

"ccounts Payable Trial /alance

The "ccounts Payable Trial /alance is actually a new report but since the name is the same it is

included in the changed reports section. The new accounting model made it necessary to rewrite the

trial balance report. "ll of the enhancements that had been outstanding against the report were

reviewed and incorporated into the new report. )or e!ample, there is now an option to run the report

for a single supplier. There is also an option to run the report for a single liability account.

Posted Invoice 2egister

This report was modified to report off the new accounting entries which have been transferred togeneral ledger. This +along with the Posted Payment 2egister was one of the cases where the use of

the word posted was retained in 11i. "lthough technically the accounting in this report has only

transferred to general ledger and not necessarily been posted, the e!isting report name seemed li#e

the simplest to use.

"ll of the enhancements that had been outstanding against the report were reviewed and

incorporated into the new report. )or e!ample, there is now an option to run the report for a single

liability account. There is also an option to run the report in summary in order to get totals for

reconciliation purposes.

Posted Payment 2egister

This report was modified to report off the new accounting entries which have been transferred to

general ledger. "ll of the enhancements that had been outstanding against the report were reviewed

and incorporated into the new report. )or e!ample, there is now an option to run the report for a

single liability account. There is also an option to run the report in summary in order to get totals for

reconciliation purposes.

$ew (lose Process

The process to close an accounting period has changed in release 11i. The close process is reviewed

here in order to compare it with the close process in prior releases. The form to control the status ofan accounting period has been renamed from "P "ccounting Periods to ontrol Payables

Periods. Its location in the navigator has also changed. It has moved from the -etup section into the

new "ccounting section of the menu. The rules to close a period in Payables in release 11iare(

"ll payment batches must be confirmed

"ll transactions must be accounted

"ll accounting entries must be transferred to general ledger

"ll future dated payments which have reached maturity in the accounting period must have

their status updated to negotiable and be accounted

Optionally, unaccounted transactions can be swept to the ne!t accounting period if allowed by

accounting rules. There is a new program in 11ito support this & the 9naccounted Transactions

-weep. This program can be submitted from the ontrol Payables Periods window in both a review


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mode and an update mode. The program can be called only if there are any unaccounted

transactions in the period. The report output of the program loo#s very much li#e the 9naccounted

Transactions 2eport. This new program replaces the 9nposted Invoice and Payment -weep.

/efore invoices can be accounted they must be validated by the Invoice Falidation process. /efore

payments can be accounted they must pass through the onfirm process. Typical steps to close a

period in Payables release 11iare(

Import all invoices and4or e!pense reports from interface tables

2un Invoice Falidation

onfirm any outstanding payment batches

2un the 9pdate 3atured )uture Payment -tatus program for any future dated payments

2un the Payables "ccounting Process

2eview the accounting process output and correct any accounting errors

2eview the 9naccounted Transactions 2eport to identify transactions which cannot be

accounted orrect any transaction data and run the Payables "ccounting Process again

2eview the Payables "ccount "nalysis 2eport +If someone reviewed the !pense

8istribution 8etail 2eport for certain accounts in prior releases they will want to review this

new report in 11i

2un the Payables Transfer to $eneral %edger

Optionally run the 9naccounted Transactions -weep

lose the Payables period

2econcile

Technical O"er"iew

This section is an overview of the architectural changes made to Oracle Payables to support the new

accounting model. It is not an e!haustive discussion of all the changes made to the product, but it

should serve as a reference point for understanding the ma*or changes. It should also help in

understanding what the upgrade process does and if there is impact to any custom code a business

might have.

The #ey data model changes revolve around the fact that now accounting entries are created andstored in the Payables subledger. Prior to release 11i, data from three tables was used to create

accounting entries in the general ledger interface( "PGI5FOIG8I-T2I/9TIO5-G"%%,

"PGP";35TG8I-T2I/9TIO5-G"%%, and "PG2O5G8I-T2I/9TIO5-G"%%

+2efer to 8iagram 1 at the end of this paper for a view of the release 11 data model.

5ow in release 11i, three new tables are used to hold the accounting entries created in Payables(

"PG"O95TI5$GF5T-G"%%, "PG"GH"82-G"%%, and "PG"G%I5-G"%%.

"PG"O95TI5$GF5T-G"%% is populated at transaction time. The remaining two tables,

"PG"GH"82-G"%%, and "PG"G%I5-G"%%, are populated by the Payables "ccounting

Process. The process creates accounting entries for every set of boo#s +combined basis accounting

or 32. 8ata from these tables is now transferred to the general ledger interface. There is anothernew table which has been added to help trac# the activity on a payment(

"PGP";35TGHI-TO2;. This table holds all the information for determining the payment


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maturity, payment clearing, and payment unclearing events.

+2efer to 8iagram > at the end of this paper for a view of the release 11 idata model.

9pgrade

The upgrade to release 11iconverts the data in the three distributions tables into accountingentry

data in the new tables. The tables "PGP";35TG8I-T2I/9TIO5-G"%% and

"PG2O5G8I-T2I/9TIO5-G"%% are obsolete in release 11i, although they are not dropped.

5ew Tables

"PG"GH"82-G"%%

"PG"G%I5-G"%%

"PG"O95TI5$GF5T-G"%%

"PG593/2"5G%I5-G"%%

"PGP";35TGHI-TO2;G"%%

"PG3GP";35TGHI-TO2;

"PGT2I"%G/"%

5ew )orms9pdate "ccounting ntries +"P@9P8"

Fiew ncumbrances +"P@F'5

Fiew "ccounting %ines

Fiew Invoice "ccounting

Fiew Payment "ccounting

The three above are different views of the form @%"I"%

Payables Invoice "ccounting

Payables Payment "ccounting

Payables 2econciled Payment "ccounting

The three above are different views of the form @%"I82%

Obsolete Tables

"PGP";35TG8I-T2I/9TIO5-G"%%(

9sed to hold payment accounting information. The table was populated when a manual or 6uic#

payment was entered or a payment batch was confirmed.

"PG3GP";35TG8I-T-G"%%(

9sed to hold payment accounting information for reporting sets of boo#s +32.

"PG2O5G8I-T2I/9TIO5-G"%%(

9sed to hold payment reconciliation information. The table was populated when a payment wascleared or reconciled in Oracle ash 3anagement.

"PG3G2O5G8I-T-G"%%(

9sed to hold payment reconciliation information for reporting sets of boo#s +32.

"PGT2I"%G/"%"5(

9sed to hold information for the "ccounts Payable Trial /alance report.

"PG3GT2I"%G/"%"5(

9sed to hold information for the "ccounts Payable Trial /alance report when run from a reporting

set of boo#s +32.

Obsolete )ormsInvalid $% "ccounts +"P@P8)I@(

9sed to correct invalid account information and payment distributions. ffectively replaced by the


24/26

9pdate "ccounting ntries form.

Invoice 8istributions -ummary +"P@$%I5(

9sed as a way to loo# at accounting for invoice distributions. 2eplaced by Fiew "ccounting %ines

window.

5ew 2eports and Programs

+see 2eports section for details

Obsolete 2eports and Programs

Payables Transfer to $eneral %edger +"PPP-T

9nposted Invoice and Payment -weep +"P@-93P-

"ccounts Payable Trial /alance +"P@2T/

!pense 8istribution 8etail 2eport +"P@8-2-

Transaction 2econciliation 2eport +"P@T2@25

0ournal with $% 8etails 2eport +"P@0HI-

Other hanges

The posted flag in the table "PGI5FOIG8I-T2I/9TIO5-G"%% now means that the

distribution has been accounted. To see if an accounting entry has been transferred to general ledger

loo# at the transferred flag in the "PG"G%I5-G"%% table.

(onclusionThe new accounting model in Payables 11ihas dramatically changed the way accounting wor#s in

the subledger. It is important to review and understand these changes in order to ma#e a smooth

transition to the new release.

This paper provides an overview of the new accounting model and some details for the setup and

accounting entries created in the subledger. The reference documentation should also be reviewed to

ensure an understanding of how to manage accounting in release 11i.

The new fle!ible accounting entries should prove beneficial to users of Oracle Payables. 5ow the

product has an improved architecture to support building other accounting enhancements in future

releases.

Dia/ra% 1 3 !11 Physical Data Mo#el


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Dia/ra% 2 !11iPhysical Data Mo#el

How 8o ;ou "ccount for That? Oracle Payables 11i3arch >


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