COGS in 11i Vs Deferred COGS in R12

Prior to this enhancement, the value of goods shipped from inventory were expensed to COGS upon ship confirm, despite the fact that revenue may not yet have been earned on that shipment. With this enhancement, the value of goods shipped from inventory will be put in a Deferred COGS account. As percentages of Revenue are recognized, a matching percentage of the value of goods shipped from inventory will be moved from the Deferred COGS account to the COGS account, thus synchronizing, the recognition of revenue and COGS in accordance with the recommendations of generally accepted accounting principles. 
Note: Deferred COGS is a mandatory concept to used in R12 Version.
Where do we enter this COGS and Defferred COGS Account
Oracle Purchasing Navigation: Setup --> Organisation --> Organisation.
Select your inventory Organisation and Go to Other Accounts tab
Then you can see COGS and Deffered COGS A/c

Note: In early version like 11i as Defferred COGS concept is not exist, The following is screenshot from 11i Version where you can't find Deferred COGS A/c.

Accounting as per earlier version 11i.
At the time of shipping (Ship Confirmation) the accounting as follows:
         COGS A/c ..............................Dr.
                 To Inventory Valuation A/c..................Cr.
Accounting as per version Release 12 (R12):
At the time of shipping (Ship Confirmation) the accounting as follows:
         Deferred COGS A/c.................Dr.
                 To Inventory Valuation A/c..................Cr.
After AR invoice is generated, As percentages of Revenue are recognized, a matching percentage of the value of goods shipped from inventory will be moved from the Deferred COGS account to the COGS account as follows.
          COGS A/c...........................Dr.
                   To Deferred COGS A/c ......................Cr.
Record Order Management Transactions: Records new sales order transaction activity such as shipments and RMA returns in Oracle Order Management.
Run Collect Revenue Recognition Information program: This program will collect the change in revenue recognition percentage based on AR events within the user specified date range.

Navigation: Cost --> COGS Recognition --> Collect Revenue Recognition Information.

In Parameter, Give Start date and End date and submit it. 

Run Generate COGS Recognition Events: This program will create the COGS recognition transaction for each sales order line where there is a mismatch between the latest revenue recognition percentage and the current COGS recognition percentage. Here the system will credit the Deferred COGS accounting and transfer the relevant amount to COGS A/c. 

Navigation:  Cost --> COGS Recognition --> Generate COGS Recognition Events.
Here, the following accounting will be generated 
           COGS A/c...........................Dr.
                   To Deferred COGS A/c ......................Cr.

Ledger Set Concept in Oracle Apps

Ledger set is used to access multiple Ledgers information from single responsibility. Using Ledger set we can group only Ledgers which are having same Chart of Accounts and same Calendars.

Step 1: Define ledger sets
Navigation: Setup --> Financials --> Ledger Sets

Enter Name and Short name and all mandatory info and Save and Close this window.

Step 2: Assign Ledger set to responsibility

Navigation: System Administrator

Profile --> System

Choose responsibility

Profile Option: GL: Data Access Set

Choose Ledger set

If you assign both the profile options: GL Ledger Name & GL Data Access Set System will choose first Data Access set

Step 3: Enter Journal to test the functionality of ledger Set.

Navigation: Journal --> Enter

Enter new Journal

You can choose any Ledgers from here, which are assigned to Ledger set

Note: We have to assign GL: Data access set profile option and Ledger set to all the GL responsibilities, so that we can access all ledgers from any responsibility.

Definition Access Set Concept in Oracle Apps

It is an optional feature, for Security Purpose, which works at responsibility level .
It is used to provide "View","Use", "Modify" access to the various gl definitions.
For example: You can secure Calender, Mass Allocation Formula, FSG reports.. Etc. to allow users to modify, View and Use it.

Setup Step:
1. Create a Definition Access Set.
2. Assign it to one or more responsibilities to Definition Access Set.
3. "Enable Security" Check Box in Respective Form and click on "Assign access" and assign to definition access Set with the proper privileges (View, Use & Modify).

Let's see how to configure Definition Access Set
Step 1: Define Definition Access Set
Navigation: Set up --> Financials --> Definition Access sets --> Define.

Enter Name & Description to Definition Access set and Save it.

Step 2: Assign Definition Access set to Responsibility

Navigation:

Setup --> Financials --> Definition Access Sets --> Assign

Choose Responsibility: General ledger

Security Group: Standard

Choose Definition Access Sets

Automatic Privileges: Enable check boxes for: Use, View and Modify

Save and Close this window

Click on Ok Button and Ensure Program completed normal

Step 3: Enable Security for accounting Calendar

Navigation: Setup --> Financials --> Calendars --> Accounting

Query your accounting calendar

Select check box “Enable Security”

Click on “Assign Access” and Choose "Definition Access set"

Click on " OK" Button and Save it and following note will Appear

Decision window pop's Up, Now click on "Current" Button

Ensure the program completed normal.

Step 4: Query the accounting Calendar to Test the definition access set is working or not

Navigation: Setup --> Financials --> Calendars --> Accounting.

As we have given View, Use and Modify Privileges, you will be have all the right to view, use and modify the calendar data.

Query the definition access form to see the changes.

Data Access Set Concept in Oracle Apps

Data Access Set is an Optional feature for Security Purpose.
It is used to provide "Read Only" or "Read & Write" access to the ledger or balancing segment values or management segment values. It provides security in three Levels.
       1. Ledger Level.
       2. Balancing Segment Values.
       3. Management Segment Values.
Ledger Level: Provides access to Full Ledger (Whole COA)
Balancing Segment Values: Provides access to specific to Balancing segment Values
Management Segment Values: Provides access to specific Management segment Values.
Steps: 
1. Define Data Access Set
Navigation: Setup --> Financials --> Data Access Set.
2. Assign these data access set to a profile option (GL data access Set).

Revaluation Concept in Oracle Apps

It is used to identify unrealized gain/loss amount which occurred due to foreign exchange rate fluctuations. The difference in revaluation will be transferred to unrealized gain/loss a/c. We run revaluation in two modules- i.e., GL & FA. In GL we run the revaluation to know the current asset & liabilities due to fluctuation in the currencies and In assets we run the revaluation to revalue the assets.
Note: Revaluation can be done only before making the payment or before receiving the amount in GL.
Setup Steps:
1. Define “Unrealized Gain (revenue) a/c & Unrealized Loss (Expenses) a/c” at account segment level.
Note: If required assign profile option “GL: Revaluation: Validate Gain & Loss A/c” at responsibility Level.
2. Define exchange rate type
3. Define Exchange rate.
4. Enter foreign currency journal & post it.

Note: If you want to see the changes you change the exchange rate.5. Run Revaluation.
6. Query revaluation journal and post it.

Now, Let see how to configure revaluation concept.

Step 1: Define Unrealized Gain A/c (Qualifier as: Yes, Yes, Revenue, No, No) and Unrealized Loss A/c (Qualifier as: Yes, Yes, Expenses, No, No) at account segment Level.

Navigation: Setup --> Financials --> Flex fields --> Key --> Values.

Step 2: Define Exchange Rate Type

Navigation: Setup --> Currency --> Rate --> Types.

Click on New and add "Rate Type" and " Description".

Step 3: Define Exchange Rates.

Navigation: Setup --> Currencies --> Rates --> Daily.

Click on "Enter by Date Range" button

Say "Apply".

Step 4: For Testing Revaluation Concept, Ensure one foreign currency journal exists. 

Navigation: Journal --> Enter

Step 5: Run Revaluation

Navigation: Currency --> Revaluation.

Enter name and description for revaluation
Currency Options: Choose single currency & USD
Rate Options: Choose Daily Rates & Exchange rate type
Choose Unrealized gain & loss accounts
Choose revaluation ranges

Say " Revalue"

Submit request window will automatically open with program as “Program – Revalue balances”

Fill all parameter details and submit the request.

Click on View --> request and ensure program completed normal

Say "View Output" 

Step 6: Now Query Revaluation Journal and post it

Navigation: Journal --> Enter.

Now, See the change and Post it.

Secondary Ledger Concept in Oracle Apps

- Optional Feature, Used for the purpose of tracking alternate accounting which is linked to your primary ledger.
- Can differ in one or more of the following from the primary ledger
            Chart of accounts
            Accounting calendar
            Currency
            Subledger Accounting Method (SLA)
- The Secondary Ledgers are used for supplementary purposes and can be used for global companies to comply with various legal requirements. 
Difference Between Reporting Currency and Secondary Ledger.

If you only need multiple currencies to support your reporting requirements, use reporting currencies with a primary ledger. If you need to account for your data using different calendars, charts of accounts, accounting methods (SLA) in addition to currency, use a secondary ledger.
Data Conversion Level
           1. Balance Level.
           2. Sub Ledger Level.
           3. Journal Level.
           4. Adjustment Only Level.
Setup Steps: 
1. Define Exchange Rate Type. 
2. Define Exchange Rate. 
3. Define Secondary Ledger. 
Navigation: Setup --> Financials --> Accounting Setup Manager --> Accounting Setup.
4. Come to Secondary ledger region & complete setup step options. 
5. Define Secondary ledger to the GL Responsibility with profile options “ GL ledger Name” 
6. Assign Secondary ledger GL Responsibility to User. 
7. Open periods in secondary ledger. 
8. Enter journal in primary ledger and post it. 
9. Query the journal in secondary ledger and post it.

Fixed Asset Modules Issues & Solution in Oracle Apps

Issue: How To Reverse An Amortized Adjustment.
Solutions: You can change the amortization by below steps:
1. Go to asset workbench
2. Query asset number
3. Change the cost and increase the cost by 0.01 and change the amortization date to the same of Date Placed in Service, then save.
4. Decrease the cost by 0.01 and change the amortization date to the same of Date Placed in Service, then save.

Issue: While Running Depreciation in Fixed asset Module, Depreciation Run Program Ends in Error

Check view log output for Depreciation Run Program

Solution: If the calendar period are not opened/or not created then the system will through an error message will running depreciation program. So, You need to open/create Fiscal Calendar, Depreciation Calendar and Prorate Calendar and re-run depreciation program and check the output.

Purchasing Module Issues & Solutions in Oracle Apps

Issue:  While try to approve the Purchase Order(PO). Error: Line # 1 Shipment # 1 Distribution # 1 Distribution is missing foreign Currency rate.

Solution: Query the Purchase Order--> Click on shipments button--> Click on distribution Button --> Click on More Tab
Now update Rate date and Rate and save it and try to approve it. 

Issue: Excise Invoice No & Excise Invoice date is not shown in Receipt India Localization window.

Solution: User forgot update the Descriptive Flexfield in Receipt window. Ask to correct(Cancel) the receipt and ask him to enter Receipt Localized(Re-enter Receipt) again. Then the issue is resolved.

Issue: Purchase Order(PO) Status is showing" Pre-Approved".

Solution: The Following SQL Script will change PO Status from 

"Pre-Approved" to "Incomplete".

update po_line_locations_all 

set closed_code='', 

closed_date='', 

CLOSED_FLAG='N', 

Qty_Rcv_Exception_Code='NONE'

where po_header_id in( )        -------Enter PO Header ID    

and   org_id= ;                   ------- Enter Org ID

update po_lines_all 

set closed_code='', 

closed_date='', 

CLOSED_FLAG='N' 

where po_header_id in( )        -------Enter PO Header ID  

and   org_id= ;                          ------- Enter Org ID

update po_headers_all 

set closed_code='', 

closed_date='' , 

WF_ITEM_TYPE = NULL,

APPROVED_DATE='',  

APPROVED_FLAG='',

Authorization_Status='INCOMPLETE'  

where po_header_id in()      -------Enter PO Header ID    

and   org_id= ;                 ------- Enter Org ID

Issue: Unable to enter in Requisition Form, You are not setup as an Employee. To access this form you need to be an employee note is shown.

Solution: You need to update the following form for the above error.
1. Human Resources -> People -> Enter and Maintain
Provide all mandatory details in People form.
Select Person Types as Employee and Assign Supervisor and Save it.

Note: Need to Assign this employee to User.2. If you do not have Oracle HRMS add the employee and buyer in Purchasing Super User --> Setup -->employee or buyer from same navigation.
Now, Try to Open the Form and you can enter the Requisition.

Issue:  where receipt Header number was generated but later, the receipt number could not be found in system anywhere from front-end.
Solution: Period was not opened, for that particular warehouse.

Reporting Currency in R12 / Multiple Reporting Currency in 11i

It is used to translate balances from functional currency to foreign currency at transaction level. Here we use Daily rates. There are three levels are there.
Balances level- All the balances will be translated.
Journal Level-All the journal entries will be translated
Sub ledger Level- All the journals from AP, AR will be translated.
Note: In reporting feature we will be having one primary ledger and unlimited reporting ledgers.

Setup Steps:

1. Define “Rounding Difference Tracking A/c” at account segment value.
2. Assign rounding difference a/c to ledger.
3. Define Exchange rate type
4. Define Exchange rates.
5. Define Reporting currency Setup’s in setup step at ledger level.
6. Define Reporting GL Responsibility.
7. Assign reporting Ledger to Reporting GL Responsibility.
8. Assign Reporting GL Responsibility to User .
9. Open periods in Reporting Currency responsibility.
10. Enter Journal in primary ledger and post it. 

11. Query the journal in Reporting ledger to check the result. 
Diffence between Multiple Reporting Currency in 11i and Reporting Currency in R12.
1. In 11i we can called as “Multiple Reporting Currencies” but in R12 we are calling like “Reporting Currencies”.2. In 11i we have to define reporting set of books and assign primary set of book to reporting set of books. But In R12 directly we can add reporting currencies to ledger. It is easy process.
3. In 11i we can report upto 8 reporting currencies but where as in r12 we can report en number of currencies.
4. In 11i we have one limitation to do MRC. If the chart of account and calendar should be same to do the MRC. But in R12 if the calendar or chart of account is differ we can do “Reporting currencies” by using Secondary Ledgers.

Let's see how to configure Reporting currency concept in R12
Step: 1  Define “Rounding Difference Tracking A/c” at account segment value. 
Navigation: Setup--> Financials--> Flex fields--> Key--> ValuesEnter Structure name and Segment, Say “Find”
Enter “Rounding Difference Tracking Account” with Qualifiers as Yes, Yes, Expenses, No, No.

Now, Save it.
Step 2: Assign Rounding Difference Tracking account at Ledger level
Navigation: Setup --> Financials --> Accounting setup manager --> Accounting setupQuery your ledger and click on Update accounting optionsGo to Primary Ledger set up step and say Update
Go to “Ledger Options” tab and click on “Journal processing’ region and Assign “Rounding difference tracking account”.

Click on “Finish” and see for confirmation message.

Step 3: Define exchange rate type
Navigation: Setup --> Currency --> Rate --> types

Click on New and Enter Rate type and Description

Save and close the window.

Step 4: Define daily ratesNavigation: Setup --> Currencies --> Rates --> Daily.

Click on New and fill the details as below

and Click on Enter by date range and fill the same details with Start date and end Date. Save and close the window.

Step 5: Define Reporting currency Setup’s in setup step at ledger
Level.
Navigation: Setup --> Financials --> Accounting setup manager --> Accounting setup.
Now, Query your primary ledger --> click on Update accounting options--> In setup step Click on update of “Reporting Currencies”.
Now, Click on “Add reporting currency”
Currency conversion level: JournalCurrency: USD
Enter reporting currency name
Enter short name & Description
Ledger Options:
First ever open period: Jan – 11
Add Rounding Difference tracking account
Currency Translation options:
Choose Default rate type
Retain transaction rate type: Yes
** If yes – Rate type will take from Primary ledger
** If No – It will take above default rate as per primary ledger

Error handling:
Missing conversion rate: Use last rate
Number of days to find the last rate: 5
Journal Conversion Rules:
Retain journal creator from source Ledger: Yes
Note: 

1. If  Yes – Journals will transfer from Primary to reporting
2. If No – Journals will not transfer

Update Journal Source: Other, Journal Category: other, Convert journals: Yes
Note: If you do not want to transfer all journals, click on “Add another row” to define source and category.

Data Conversion Initialization:First future conversion period – Apr 11
Historical Conversion:
Retain original conversion type: No
Choose historical conversion rate date & type
Say “Apply”
Update reporting currencies:
Now, You can see one more reporting ledger with “Journal” as currency conversion level

Click on Apply button.

Step 6: Define Reporting GL Responsibility.
System administrator Navigation: Security --> Responsibility -->Define.

Click on new and create Reporting GL Responsibility.

Save and close the window.

Step 7: Assign Reporting Ledger to Responsibility.
System Administrator Navigation: Profile --> system.

Select your Responsibility and Profile Option as shown below

Click on Find button, and Enter Reporting Currency in Responsibility field.

Save and close the window.

Step 8: Assign Reporting GL Responsibility to the User.
System Administrator Navigation: Security --> User --> Define.

Query the user name and assign Reporting GL Responsibility to the user.

Save and close the window.

Step 9: Open periods in reporting GL Reponsibility.
Switch to Reporting GL Responsibility.

Navigation: Set up --> open / close.

Open till Current Period.

Close the window.

Step 10: Create Journal in Primary Ledger and post
Switch to Primary Ledger Responsibility.
Navigation: Journal --> Enter
Click  New Journal Button and enter Mandatory Information to test it.

Save and post it.

Step 11: Review Journal in Reporting ledger.
Switch to Reporting Ledger Responsibility.
General ledger Navigation: Journal --> Entry.

Query the query the journal to view it.

Close the Window.