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Oracle Subledger Accounting


Originally published by TriCore: February 12, 2017

This blog takes you through Subledger Accounting (SLA), which is one of the most important features of OracleĀ® version R12. SLA is the most robust feature in R12, providing the power to modify accounting according to business needs. This blog outlines the difference between R12 and earlier versions of the Subledger, along with some of its key features and components of SLA.

Introduction

Prior to R12, data was transferred from SLA to the General Ledger (GL) interface table and then imported into the GL base tables. There was no scope of modification of accounting data at the Subledger level. SLA, introduced in R12, sits between the Subledger and GL interface table, and enables you to tweak the standard accounting rules to produce the desired accounting data depending on business requirements.

Because SLA provides the power to modify accounting as needed, after the seeded rules are modified and validated, you won’t need to repeatedly revise data in the tables. When Create Accounting runs from the Subledger, it produces the desired accounting results. In addition, you can define different rules for all the Subledgers.

Differences between Subledger versions

The following image highlights the differences between the Subledger architecture in versions 11i and R12:

Key features include the following items:

  • SLA forms and programs are embedded within the standard Oracle application responsibility. Separate responsibilities are no longer required.
  • Standard rules can be copied and modified.
  • Generation and storage of detailed accounting entries.
  • SLA maintains a complete link between transactions and accounting entries, which makes auditing very easy.
  • SLA enables you to drilldown from GL journal lines to the Subledger transactions and vice versa.

Components of SLA

SLA has the following components:

Event Class (EC): Classifies transaction types. Invoice and Payment are examples of event classes in the Payables Subledger.

Event Types (ET): Define possible actions on each EC with potential accounting significance. Validation and cancellation are examples of an ET.

Journal Line Type (JLT): Defined for a particular EC and must be assigned to a Journal Line definition. A JLT carries the debit and credit aspect of accounting.

Account Derivation Rules (ADR): Contain the rules to derive the GL code combination for a particular JLT. You can assign seeded sources, custom sources, or constant values.

Journal Line Definitions (JLD): Group the EC, ET, JLTs, and ADRs for the Journal.

Application Accounting Definitions (AAD): Group the EC, ET, JLTs and ADRs for a Ledger. This is a repetitive step in R12 and is removed in the Oracle FusionĀ®.

Subledger Accounting Method (SLAM): Contains a previously created AAD to form a method that is assigned to a Ledger.

Conclusion

SLA eliminates the burden of repetitive manual accounting intervention. SLA provides a mechanism to produce the desired accounting results with minimal setup.

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Vinit Bhatnagar

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