Period Close

R12 General Ledger Management Fundamentals

Copyright 2007, Oracle. All rights reserved.

Objectives

After completing this lesson, you should be able to do the

following:
Explain the accounting cycle
Identify steps in the close process
Perform journal import of subledger balances
Reconcile to the subledgers
Run revaluation
Close the period
Consolidate account balances
Inquire and run reports on final balances

Copyright 2007, Oracle. All rights reserved.

The Accounting Cycle

Consolidate

Review/
Correct
Balances

Run Reports/
Close Period

Revalue/Translate
Open Period
Review
Post

Create/Reverse
Journal Entries

Copyright 2007, Oracle. All rights reserved.

Period Close Checklist

Transfer and import data from all subledgers

Perform reconciliation of subsidiary ledgers
Close the period for each subledger
Revalue foreign currency balances
Verify all journals are posted
Reconcile account balances
Translate balances to parent's currency
Consolidate subsidiary ledgers
Run Trial Balance and other reports
Close the period and open the next period

Copyright 2007, Oracle. All rights reserved.

Overview of Importing Journal Entries

Transfer in Summary
or Detail

Subledgers

GL_INTERFACE

Automatic or Manual

Journal
Import

Post

GL_BALANCES

GL_JE_BATCHES
GL_JE_HEADERS
GL_JE_LINES

Copyright 2007, Oracle. All rights reserved.

Journal Import Verification Process

Load GL_INTERFACE
table
Correct errors in
feeder system

Import journals by
Source and Group ID
Do journals
have errors?

Yes

No

Number of
errors?

Journal import
creates a postable
journal batch

Low

Delete source from

Journal Import (Not Oracle Subledger)

High
Correct Journal
Import online
(See Caution below)

Copyright 2007, Oracle. All rights reserved.

Posting Journals

Account Balance

Enter journal

Post journal

Prepost

$500

Journal entry

$ 25

After post

$525

Report and inquire

on updated
account balances

Copyright 2007, Oracle. All rights reserved.

Reconciling Subledger Data

Procure to Pay
Order to Cash
Projects
Non Oracle Subledgers
Subledger
s

Analysis
Reports

Copyright 2007, Oracle. All rights reserved.

Close the Subledgers

Subledgers

Close Period

Copyright 2007, Oracle. All rights reserved.

P2P Close Processes

Assets

Create Journal
Entries
General Ledger

Post Mass
Additions/
Depreciation

GL Interface
Mass
Additions
Create

Payables

Payables Transfer
to General Ledger

Transfer
Transactions
Inventory
to GL

Receipt Accruals
- Period End
Purchasing/
iProcurement

Copyright 2007, Oracle. All rights reserved.

Overview of the P2P Period Close

Prepare
for period
close

Close the
PO period

Run Invoice
Validation/
Review and
resolve holds

Run PO
Period
Accruals

Run
Payables
Accounting
Process to
Transfer

Reconcile AP
activity for
the period

Copyright 2007, Oracle. All rights reserved.

Close
the
period in
AP

Post journal
entries in GL

Reconcile AP to GL

March Accounts Payable Trial Balance

+ April Posted Invoice Register
- April Posted Payment Register
- April Accounts Payable Trial Balance
=0

Copyright 2007, Oracle. All rights reserved.

Reports
Accounts Payable
Trial Balance
Unaccounted
Transactions
Report
Accrual
Rebuild Reconciliation
Report
Uninvoiced
Receipts Report
Accrual Reconciliation Report
Accrual Write-Off Report
Matched and Modified Receipts Report
Payables Account Analysis Report

Copyright 2007, Oracle. All rights reserved.

Reports (continued)

Payables Accounting Entries Report

Posted Invoice Register
Posted Payment Register
Receipt Accruals - Period End
Receiving Account Distribution Report

Copyright 2007, Oracle. All rights reserved.

Reports (continued)
Unaccounted Transactions Report
Uninvoiced Receipts Report

Reports

Copyright 2007, Oracle. All rights reserved.

O2C Period Close Process

Order Management

General Ledger

Send all
Orders/Credit
Memos

AutoInvoice

Receivables

Transfer
Transactions
Inventory
GL Interface
to GL

Transfer to
General Ledger

Receipt
Reconciliation

Copyright 2007, Oracle. All rights reserved.

Cash
Management

Overview of O2C Period Close Process

Review, balance,
and reconcile
Receivables,
Cash
Management,
and Inventory
transactions

Complete the
transfers from
Receivables
and Inventory
to the
General Ledger

Review the
transfer
results, and
correct
transfer issues

Close Receivables
and Inventory Periods

Copyright 2007, Oracle. All rights reserved.

Post
journal
entries in
GL

Transferring Inventory and Receivables

Transactions
out of balance

Unposted Items
Report

Submit GL Interface
program

GL Interface
Table

Transactions in
balance

Posting
Execution Report

Copyright 2007, Oracle. All rights reserved.

O2C Standard Reports

Inventory and Receivables provide a comprehensive set

of reports and listings
Use these reports to review and reconcile transactions,
receipts, journals, and customer balances

Copyright 2007, Oracle. All rights reserved.

Reconciling Receivables Transactions, Receipts,

and Customer Balances
Reconcile
transactions
and receipts

Reconcile
outstanding
customer balances
Opening balance
+ Transactions
- Receipts
= Closing balance

Sales Journal by
customer
Transaction
register
Receipt register
Submit GL
Interface process

Reconcile
transaction and
receipt accounting
flexfield balances

Sales Journal
by GL
Account
Journal Entries
Report
Receipts Journal
Report

Copyright 2007, Oracle. All rights reserved.

Mapping Receivables Transactions

to General Ledger Categories
Oracle Receivables Transactions
Transaction Type

Category in General Ledger

Debit Memos

Debit Memos

Credit Memos

Credit Memos and Credit

Memo Applications

On-Account Credits

Credit Memos

Invoices

Sales Invoices

Chargebacks

Chargebacks

Receipts

Trade Receipts

Adjustments

Adjustments

Guarantees

Sales Invoices

Miscellaneous Transactions

Miscellaneous Receipts

Deposits

Sales Invoices
Copyright 2007, Oracle. All rights reserved.

GL Reconciliation Report for

Cash Management
The GL Reconciliation Report:
Reconciles the General Ledger cash account to the
bank statement balance
Lists the General Ledger cash account balance and
adjusted balance
Lists separately the adjustment amount for
unreconciled receipts, payments, journal entries, and
bank errors

Copyright 2007, Oracle. All rights reserved.

Project Close Cycle

Create Journal
Entries
General Ledger

Assets

Post Mass
Additions/
Depreciation
Mass
Additions
Create

Payables

GL Interface

Transfer
Labor and
Usage Costs

Projects

Transfer Project
Assets

Transfer Payables
Invoices and
Expense Reports

&

Transfer Open
Purchase Orders

Copyright 2007, Oracle. All rights reserved.

Purchasing

Overview of Project Closing Cycles

Post
Post Closing
Closing
Tasks
Tasks
Closing
Closing
Cycle
Cycle Tasks
Tasks

Enter
Enter
transactions
transactions
Closing
Closing
Cycle
Cycle
Preparation
Preparation
Tasks
Tasks
Copyright 2007, Oracle. All rights reserved.

Closing a PA Period

The final step before fully closing the current PA period

is to interface revenue with the General Ledger. Run the
process
PRC: Interface Revenue with General Ledger

It is at the discretion of the user when to set the current

PA period to the new PA period

Copyright 2007, Oracle. All rights reserved.

Period-Closing Exception Reports

Use the following period-closing exception reports to

identify transactions that have not been processed
successfully and that would prevent you from closing
the PA period
EXC: Summarization Period Exceptions
EXC: Transaction Exception Details
EXC: Transaction Exception Summary

Corrected the exceptions and close the PA period

Copyright 2007, Oracle. All rights reserved.

Period Rates

General Ledger uses:

Period-average and period-end rates when you
translate your actual and budget account balances
The revaluation rate when you revalue account
balances that are denominated in a foreign currency

REVALUE

Copyright 2007, Oracle. All rights reserved.

Running Revaluation
Revalue Foreign
Currency Balances
Reverse Revaluation
Journals

Is the foreign Currency

Receivable Still Unpaid?

Post to Unrealized
Gain/Loss Account

Yes

No
Collect Foreign
Currency Receivable

Post to Realized
Gain/Loss Account

Copyright 2007, Oracle. All rights reserved.

Revaluation Example
Entered Journal Entry Lines
DR. Accounts Receivable.10,000 Euro
CR.

Revenue10,000 Euro

Convert 1 Euro = .8 US Dollars

DR. Accounts Receivable. 8,000 US$
CR. Revenue... 8,000 US$

REVALUE 1 Euro = .81 US Dollars

DR. Accounts Receivable. 100 US$
CR. Unrealized Gain.. 100 US$

Copyright 2007, Oracle. All rights reserved.

Accounting Period Status

Never
Opened

Open
Period

Future
Enterable

Permanently
Closed Period

Closed
Period

Copyright 2007, Oracle. All rights reserved.

Balance Sheet Close

Meets global audit and statutory reporting requirements

Closes your balance sheet accounts to a specified
balance sheet closing account
You can automatically reverse this journal at the
beginning of the next period

Copyright 2007, Oracle. All rights reserved.

Income Statement Close

Run Income Statement Close at any time to

predetermine the effect of a close, or perform pro-forma
reporting
Create actual closing entries to meet auditing
requirements
Close your income statement accounts to the retained
earnings account or another account

Copyright 2007, Oracle. All rights reserved.

Historical Rates

Historical Rates are:

Weighted average rate for transactions that occur at
different times
Used to report journal entry line amounts in the units of
money that were current when the transactions took
place

TRANSLATE

Copyright 2007, Oracle. All rights reserved.

Foreign Currency Translation

Functional currency

Functional
Balance Sheet
Assets
Liabilities
100,000
60,000
Period end
Rate = 0.75
Period end
Rate = 0.75

Foreign currency

Owner's Equity
40,000

Foreign
Balance Sheet
Assets
Liabilities
75,000
45,000

Historical
Rate = 0.70
Owner's Equity
28,000

Copyright 2007, Oracle. All rights reserved.

Overview of Consolidations

With Oracle General Ledger, you can consolidate any

number of subsidiaries that use different ledgers
Subsidiary 1

Subsidiary 2

Subsidiary 3

Run Consolidation
Parent

Copyright 2007, Oracle. All rights reserved.

Global Consolidation System (GCS) Features and

Benefits
Global Consolidation System provides:
A workbench to view the consolidation status
Sophisticated consolidation mapping rules
A color-coded consolidation monitor that guides you
through the consolidation steps
A Consolidation Hierarchy Viewer to graphically display
your consolidation structure
Automatic generation of eliminating entries
Multilevel drilldown capabilities to subsidiary balances
Powerful report publishing capabilities using FSG

Copyright 2007, Oracle. All rights reserved.

Consolidating Ledgers
Subsidiary
ledgers
Consolidation
journal

Run consolidation

Run journal import

GL_INTERFACE
table

Post
consolidation batch
Parent
ledger

Copyright 2007, Oracle. All rights reserved.

Reporting Options
Reporting
Function
RXi

OI Std

Web
FSG ADI EPB

BIS

Disc

Review Balances

Summary/detail
--Journals
---Subledger
-----Preseeded
----
Create Financials
--Create Report Sets
----
Auto Schedule
---
Publish to web
-- Query live data
--Snapshot
-Copyright 2007, Oracle. All rights reserved.

Performing Account Inquiry

Account
Inquiry
(B) Show
Balances

(B) Show
Journal Details

(B) Show
Variance

Detail
Balances

Journals
(Inquire)

Variance

Journals
Summary
Balances

Copyright 2007, Oracle. All rights reserved.

Helpful Closing Reports

Consolidation Exceptions Reports:

Unmapped Subsidiary Report

Disabled Parent Accounts Report

Consolidations Rules Report

Consolidations Audit Report
Trial Balance Reports:

Detail
Summary
Translation
Standard
Reports

Copyright 2007, Oracle. All rights reserved.

Request
Sets

Summary

In this lesson, you should have learned how to:

Explain the accounting cycle
Identify steps in the close process
Perform journal import of subledger balances
Reconcile to the subledgers
Run revaluation
Close the period
Consolidate account balances
Inquire and run reports on final balances

Copyright 2007, Oracle. All rights reserved.