AFL – GST on Oracle 11i

GOODS & SERVICES TAX

Prepared & Presented

By Sendilvel
May 2017
NEW INDIAN TAX STRUCTURE
 GST - THE ROAD AHEAD
• Adaptability:
– ERP system readiness to be GST compliant

• Business process refinement:

– All tax-related inward and outward processes
– Interstate stock transfers
– Subcontracting
– Process for tax utilisation at the month-end

• Tax configuration and computation:

– Monthly tax returns
– Configuration changes
– Ready, scalable and adaptable to future changes in the Indian financial
environment
GST - THE ROAD AHEAD – contd …
• Document numbering:
– Unique sequential numbering for outgoing GST invoices numbering
– Need to be configured as per the directives by tax authorities.

• Master data amendments:

– Chart of accounts, material master, vendor master, customer masters,
price masters, etc.
– Capturing of vendor and customer GST registration numbers is mandatory
for availing or passing the credits, and reporting purpose.

• Reporting and printing requirements:

– Appropriate reports will need to be developed based on regulatory
requirements.
– Changes to existing forms, such as contracts, purchase orders, quotations,
invoices, etc., to reflect the correct taxes.
GST - THE ROAD AHEAD – contd …
• Impact on interfaces:
– The impact on any existing interfaces
– Third party tools, if any

• Tax credit migration:

– The tax credits from existing deductible taxes, such as Excise, Service tax,
Value Added Tax (VAT). etc.,
– Distributed to the appropriate account as per the directives to be received

• Closure / reversal of partially open transactions:

– Goods received but invoiced, or
– Goods issued for sales but not received by the customer
GST - THE ROAD AHEAD – contd …
• Migration of open transactions:
– Migrate Open transactions, like Contracts, Purchase Orders, and Sales
Orders

• Managing exceptional transactional requirements:

– Interim provisions may be required to handle returns of goods sold or
purchased and returned after GST implementation, stock in transit etc.
 GST - BUSINESS IMPACT
IMPACT AREAS - Business

Manufacturing
Supply Chain Model Vendor Management
Sub-contracting and Extended
Network Design Categories and Capabilities
Manufacturing

IT - IMPACT AREAS GST – BUSINESS PROCESS IMPACT

 Current Tax Org Structure

 Master Data- Customers, P2P O2C
Vendors tax details.
 Tax Configuration and Tax
Transaction Processing TAX CALCULATION
 Matching, Settlement and
Processing
 Tax Reconciliation
 Registers and Reports TAX REPORTING

 Invoice Uploads to GSTN

Portal
 Inventory Management CREDIT AVAILAMENT
 ORACLE 11i

What needs to be done in

Oracle 11i
 GST IMPACT AREAS
• Configuration Changes in Tax Regime
• Changes in the IR-IS Process including Stock Transfers and
Sales Returns
• Classification of Vendor Type selection based on Registration
– Currently Mass Update of Supplier Master/Sites not available
• Vendor Site to have Tax Category updated
• HSN Coding for Inventory Items
– Mapping of Existing Inventory Items to HSN Codes
• SAC Coding for Service
– Mapping of Service Items to SAC Codes
• Invoicing Format changes – CEMLI
• Input Credit Availment Process – CEMLI
• India Localization Reports – CEMLI
 TRANSITION PLAN FOR AFL

Modules Impacted What needs to be done

TAX – GST Patch – None Provided for 11i
GST Configuration Define: Regime, Tax Type, Rates, Category,
Groups, Item Classification (RM, FG, CG)
INVENTORY – HSN Mapping of Items
Classification for Items / SAC Mapping of Services
Services
AP – Classification of Registered, Composite, Un-
Vendor Management registered, etc.,
Map Tax Category at Additional Information
GL – OU / Inv Org to be re-organized, if required
Organization Configurations COA changes, if required
Document Numbering
Generic – India Address Style with State as Mandatory for
Location Address Style Supplier Definition
 TRANSITION PLAN FOR AFL

Modules Impacted What needs to be done

Reports – 1. Debtors Ledger
Custom 2. Creditors Ledger
3. Location wise GST Tax Break up Report
4. PO Format
5. Invoice Format (Rule 8)
6. Job Work Challan (OSP)
7. Return for Internal Purposes
8. Tax Payment Register
9. State wise – Supplier Wise despatches
AR – Invoice Type and Order 1. Zero Rated Supplies
Type Classification 2. Exempted Supplies
3. Taxable Supplies – Registered Person
4. Taxable Supplies – Un-registered Person
5. Supplies through e-commerce sites
6. Supplies through Dealers
 TRANSITION PLAN FOR AFL
Modules Impacted
AP –
PO Classification – Invoice
What needs to be done
1. Zero Rated Suppliers
2. Exempted Suppliers
3. Registered Person
4. Un-registered Person
5. Supplies through e-commerce
6. Supplies through Dealers
7. Job Work
8. Input Service Distributors
 PRE-REQUISITES BY AFL

Modules What needs to be done

GL COA • Create interim accounts to park current values for recon.
• GST Accounts to be used going forward
AP Vendors • GST Numbers from all suppliers by State
• Classification Type
OM & AR • List all Existing Order Types and Transaction Types

Inventory • HSN and SAC codes by Item / Service respectively

Doc • Validate with Auditors and Tax Authority on what is the

Numbering Sequence numbering to be used (as per Tax Authority)
AP and AR – • Customer Site should have Tax Category attached by Ship To
Tax Codes to Location of the Customer by State
be defined • GST Rates to be defined, which be used by AFL for each of its
OU, by State and by Product
• List all existing Tax Codes used
PRE-REQUISITES BY AFL – contd …

Modules What needs to be done

Reports • List all reports currently being used which have a Tax touch
point. Including Month end closing, for tax filing, etc.
• Oracle APEX can be used to build the reports
Interfaces • List all current Interfaces built for Tax

TAX – • To Subscribe to GST Suvidha Provider (GSP)

Input Tax • How to handle, transition period transactions to avail credit
Credit
TAX – • To Subscribe to GST Suvidha Provider (GSP)
Returns • List of Returns to be generated at every stage

TAX – • To Subscribe to GST Suvidha Provider (GSP)

Payment • Other Alternative, if available
 ORACLE 11i

Decision required on
approach to be taken
by AFL

1. Inside Oracle – Not recommended, T&E constraint

2. Outside of Oracle – Not Recommended, T&E constraint
3. Inside Oracle – Outside Oracle – Recommended
T&E – Time and Effort
IMPLEMENTATION APPROACH - 1
Invoicing and Tax Calculation and Invoice Print – All in Oracle 11i

Setups & Operations in 11i for all OU’s including WMS

• All Setups are done in 11i including Tax Regime and Tax Rates
Definition
• Print Invoices from Oracle and issue the same to Customers
• AP Invoices to be recorded with all Supplier Information
• Tag respective HSN / SAC Code as appropriate for both AP and AR
Invoices

Oracle will be the transactional system for all OU’s

Change management process needed for WMS to be unplugged from
current process of invoicing, currently Invoicing is outside of Oracle for
WMS business
IMPLEMENTATION APPROACH - 2
Invoicing and Tax Calculation and Invoice Print - Outside Oracle

Basic setups & activities Tax Calculation & Invoice

from 11i Print 11i for all OUs like
WMS
• Setups required to be done in • Tax Rates and Method of
11i including Tax Regime, Tax Calculation
Rates, HSN / SAC Code as • Calculate tax and generate
appropriate invoice from the new system to
• AR & AP Invoice Lines will be be built
created for base amount • Send Tax Lines back to Oracle
• Send invoice to another system • Collect or Make payments
for GST processing accordingly in Oracle
Invoicing will be completely outside of Oracle for all business, like WMS
today – Huge Customization & Testing Effort, Not enough time
A new process required for Invoicing, tax calculation & sending of tax
lines back to Oracle 11i
IMPLEMENTATION APPROACH - 3
Invoicing and Tax Calculation and Invoice Print – Oracle + Existing

Setups & Operations in 11i WMS will interface to Oracle

except WMS
• Setups in 11i including Tax
Regime, Tax Rates, HSN / SAC
Code as appropriate
• AR & AP Invoice Lines will be
created and tax calculation in
Oracle for all business except
one
• Calculate tax and generate
invoice for that business
• Follow current process of
sending the Invoice including
Tax lines to Oracle
• Collect or Make payments
accordingly in Oracle as per
current process

Will not see HSN / SAC codes in AR / AP transaction screen, they will be
coming only in final report from inventory module – Reports to be built in
Oracle APEX
Change management, required only for the GST Implementation
 IMPLEMENTATION APPROACH
Ready by July 1st After July 1st
Define: Regime, Tax Type, Rates, Category, Reports – Custom reports as
Groups, Item Classification (RM, FG, CP) specified earlier

HSN Mapping of Items & SAC Mapping of Interfaces to GSP / for upload of Tax
Services Lines information
AR – Invoice Type and Order Type
Classification
AP – Classification of Registered,
Composite, Un-registered, etc.,
Map Tax Category at Additional Information

GL – Document Numbering
India Address Style with State as Mandatory
for Supplier Definition
AR – Invoice Print
PO Format
PO Classification – Invoice
 PROPOSAL ASSUMPTIONS

• Approach 3 (current process As Is) will be the way to do GST

implementation
• Technical Resources have been kept at a minimum and they will
work out of our office. They will visit AFL on need basis only
• Functional Resources will be based out of AFL while doing setups
and testing to facilitate on the job training to core users
• AFL will have core team members working along so that they will be
trained on the job
• We have not considered efforts to upload any Invoices during the
transitional period (namely between 28th Jun and 1st July) with the
tax authority.
QUESTIONS
THANK YOU