Understanding Accruals R12 05012013

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Understanding Accrual Reconciliation process and

Troubleshooting in R12
Pramod Sethi
Pitchai Gopalakrishnan
Agenda
Overview Of Accruals
Setups
Accrual Reconciliation Programs
Reconciliation Data flow
Common Reconciliation Issues
Accrual Diagnostics Script
Demonstration
Agenda
Setups
Demonstration
Accruals are accumulation of expense that is recognized before

cash is paid.
Accruals are liabilities to pay for goods or services that have been
received but have not been paid or invoiced.
Examples
Wages payable
Sales tax payable
Rent payable
Types of Purchase Accruals
Types of Purchase Accruals

Online Accruals
Period end Accruals
Online Accruals
Period end Accruals
Inventory and Expense items
Only Expense items
Accruals generated while saving the

receipts
Accruals generated during period end

for uninvoiced receipts
Accruals can be viewed from View

Accounting form
Cannot be viewed from View

Accounting form
Accruals are knocked off when

invoiced
Accruals are reversed in next period.
Accrue On Receipt = Yes
Accrue On Receipt = No
Accrual Accounting Entries

Online Accruals
Transaction
Accounting Entries
Receive
Accrual
Receiving Inspection
Cr
Dr
Deliver
Receiving Inspection
Inventory Valuation
Cr
Dr
Invoice
Supplier Control
Accrual
Cr
Dr
Period end Accruals

Transaction
Accounting Entries
Receive
Accrual
Expense
Cr (Dr)
Dr (Cr)
Invoice
Supplier Control
Expense
Cr
Dr
10
Agenda
Setups
Demonstration
11
Setups
Defining Expense Accrual Options

At Receipt
Period End
Expense A/P accrual account

This account is used to accrue payables liability for expense items at
time of receipt.
This account is used to accrue payables liability for expense items by
receipt period end accrual process.
Navigation
Purchasing responsibility > Setup > Organizations > Purchasing
Options
12
Setup Expense AP Accrual Account
select expense_accrual_code,inventory_accrual_code,accrued_code_combination_id from

po_system_parameters_all where ORG_ID=&OU_ID
13
Setup Inventory Accrual Account
Inventory A/P accrual account

This account is used to accrue payables liability when inventory items
are received.
Navigation
Inventory responsibility > Organization >Parameters > Other

Accounts
Declare the accruals accounts

Before starting the reconciliation declare the accounts
Navigation
Purchasing responsibility > Accounting > Accrual Write Off > Select
Accrual Accounts
14
Setup Inventory Accrual Account
select ap_accrual_account from mtl_parameters where organization_id=&INV_ORG_ID;
15
Setup Accrual Accounts
select * from cst_accrual_accounts where operating_unit_id=&OU_ID
16
Agenda
Setups
Demonstration
17
Below programs are used for online accrual reconciliation process

Create Accounting Receiving / Cost Management
Transfer Journal entries to GL
Accrual Reconciliation Load Run
AP and PO Accrual Reconciliation Report

Miscellaneous Accrual Reconciliation Report
Summary Accrual Reconciliation Report
Account Analysis Report
18
Create Accounting Receiving / Cost Management

Transfers the data from receiving/ inventory subledgers to SLA.
Create journals in SLA .
Transfer and posting journals to GL can also be done.
Transfer Journal Entries to GL

Transfers journals entries to GL
Posting the transferred journals can also be done.
19
Purchase Accrual Process
Receive Purchase
Order
Receiving Transaction
Processor
Create AccountingReceiving/Cost Mgt
Transfer Journal Entries to

GL
20
rcv_transactions
rcv_receiving_sub_ledger
xla_distributions_links
xla_ae_headers
xla_ae_links
gl_je_headers gl_je_lines
gl_import_references
Inventory Accrual Process
Inventory
miscellaneous
transactions
Cost Manager
mtl_transaction_accounts
Consignment
transactions
Create Accounting-Cost
Management

GL
21
xla_ae_headers
xla_ae_links
Payables Accrual Process
Payables Invoices
Create Accounting

GL
22
ap_invoice_distributions_all
xla_ae_headers
xla_ae_links

The Load program is used to populate the accrual reconciliation tables
with all the necessary transaction data needed to perform the
reconciliation process.
All the affected Po distributions within the date range will be deleted
first and current/updated values for the transactions in the date range
will be appended to existing data
In upgraded instance Ignores the From Date specified and runs from
the start of transaction history
In upgraded instance upgrades the write off transactions from 11i and
loads them into cst_write_offs and cst_write_off_details table.
23
Load Run Data Flow
xla_ae_headers
xla_ae_links
Accrual Reconciliation
Load Run
cst_reconciliation_build
cst_reconciliation_summary
cst_ap_po_reconciliation
cst_misc_reconciliation
CSTACCLB.pls is file associated to Accrual Reconciliation Load run program
24
Load Run Log file

Accrual Reconciliation Load Run program log file
CSTACRLR module: Accrual Reconciliation Load Run
+-----------------------------------------------------------------------**Starts**17-DEC-2012 14:57:37
**Ends**17-DEC-2012 14:57:37
+---------------------------------------------------------------------------+
Start of log messages from FND_FILE
+---------------------------------------------------------------------------+
start_accrual_load +
l_stmt_num :5
p_from_date :2012/11/01 00:00:00
p_to_date :2012/11/30 00:00:00
l_operating_unit:228
accrual_load+
p_operating_unit:228
p_from_date := 2012/11/01 00:00:00
p_to_date := 2012/11/30 00:00:00
l_stmt_num:5
l_req_arg:2012/11/01 00:00:00
l_req_running:1
l_stmt_num:10
l_acc_accounts:0
EXCEPTION FND_API.g_exc_error IN accrual_load
l_stmt_num :10
x_msg_count:0
x_msg_data :
accrual_load - l_err_status:E
accrual_load - l_err_count :0
accrual_load - l_err_data :
start_accrual_load+---------------------------------------------------------------------------+
End of log messages from FND_FILE
+------------------------------------------------------------------------
25
Accrual Reconciliation Reports
AP and PO Accrual Reconciliation Report

Shows the transaction details based on each accrual account for each
PO distribution with the Receiving transaction amount and invoice
transaction amount with a net balance greater than zero.
Miscellaneous Accrual Reconciliation Report

Shows the transaction details based on each accrual account which
got hit because of Miscellaneous Inventory transactions and AP NO PO
transactions.
Summary Accrual Reconciliation Report

Shows the total balances for each accrual account without any
distribution details and individual transaction amount.
26
Agenda
Setups
Demonstration
27
Reconciliation Data Flow
Setup Accrual Account
Accrual Load Run
AP & PO Reconciliation
Report
Summary Reconciliation
Report
Miscellaneous Write Off
AP & PO Write Off
Write-Off Report
28
Miscellaneous
Reconciliation Report
Table Information
cst_reconciliation_build
A record is inserted into this table each time Accrual
Reconciliation Load run program is submitted.
To verify whether Accrual load run program is run for the period
this table data has to be checked.
cst_reconciliation_summary
Summary Accrual Reconciliation report picks data from
cst_reconciliation_summary which gets populated during the
load run process.
29
Table Information
cst_ap_po_reconciliation
AP and PO Accrual Reconciliation Report picks data from
cst_ap_po_reconciliation which gets populated during the load
run process.
cst_misc_reconciliation
Miscellaneous Accrual Reconciliation report picks data from
cst_misc_reconciliation which gets populated during the load
run process.
cst_write_offs
Write off data is stored in cst_write_offs
Write off report picks data from this table.
30
Agenda
Setups
Demonstration
31
Data not transferred from sub ledgers to SLA

Data not transferred from SLA to GL
Data corruption like
Negative Ledger id in GL Tables
Data marked as transferred in SLA but not reached GL.

Data marked as not transferred in SLA, but reached GL
Records missing gl sl link id
Accrual account not unique.

Periods are not upgraded in R12 instance which is migrated from
11i
32
Upgrade Process
The below options are available to upgrade 11i accrual transactions

SLA Pre-Upgrade,
SLA Post-Upgrade and
Hot Patch.
During the upgrade, existing accounting data from the subledgers

(i.e., Costing, Payables) is upgraded into the new Oracle Subledger
Accounting (SLA) data model. For more information refer note
Note 604893.1 -R12.0 and R12.1: FAQ for the SLA Upgrade: SLA PreUpgrade, Post-Upgrade and Hot Patch
33
Accrual Balance before Upgrade
In 11i
Transaction
Type
Transaction
Date
Transaction
Qty
Receive
01-DEC-2011 10
-100
Invoice
01-JAN-2012
100
10
Accrual
Balance ($)
Net accrual balance = 0

Pre upgrade done from 01-JAN-2012 to 31-OCT-2012
34
Periods upgraded before R12 Upgrade
JAN 2005
JUL 2007
.
DEC 2009
.
AUG 2011
..
JAN 2012
Data in this date range is upgraded

using SLA Pre-Upgrade program
.
OCT 2012
35
Accrual Balance after Pre-upgrade
In R12
Transaction
Type
Transaction
Date
XLA Accrual
Balance ($)
GL
Accrual
Balance ($)
Receive
01-DEC-2011
-100
Invoice
01-JAN-2012
100
100
Net accrual balance in XLA = 0+100= 100

Net accrual balance in GL = - 100 +100 = 0
36
Periods upgraded in R12

Periods upgraded after R12 upgrade
JAN 2005
JUL 2007
.
DEC 2009
JAN 2010
using SLA Post-Upgrade program
DEC 2011
JAN 2012

using SLA Pre-Upgrade program
.
OCT 2012
37
Accrual Balance after Post-upgrade
In R12
Transaction
Type
Transaction
Date
XLA Accrual
Balance ($)
GL
Accrual
Balance ($)
Receive
01-DEC-2011
-100
-100
Invoice
01-JAN-2012
100
100
Net accrual balance in XLA = -100+100 = 0

Net accrual balance in GL = - 100 +100 = 0
38
Recommendations
If all periods are not upgraded(partial upgrade) then as on date

accruals balances in XLA and GL will never match.
If some accruals transactions in the upgraded periods have
data missing in XLA tables then follow below note
Note 1472099.1 - Missing Accounting Entries In SLA For
Transactions In Upgraded Periods
39
Recommendations
Use different accruals account for period end and online

accruals.
Ensure accrual account is not same as the below accounts
Charge account
Receiving Inspection account

Budget account
Variance account
Supplier liability account
Do not use Uninvoiced Receipt Report to reconcile online

accruals.
40
Recommendations
Upgrade the CSTACCLB.pls file version to the highest version.

Product Ver.
Latest file Ver.
Patch
R12.0.X
120.23.12000000.47
12951241:R12.BOM.A
R12.1.X
120.27.12010000.39
13630026:R12.BOM.C
Run the Accrual Load program for incremental periods.

Run the Accrual Load program for overlapping periods only if back
dated transactions are done.
41
Agenda
Setups
Accrual Data flow
Demonstration
42
Accrual Diagnostics script
The Accrual Diagnostics script is designed to be run when there is a

reconciliation issue between subledger and GL.
The script is designed to spool full table contents to a html file.
The script is being created to allow customers to run a single script
to retrieve all data from various tables instead of having to run
individual scripts - spooling to multiple files.
The script is applicable only for R12 customers.
The script is applicable only for discrete manufacturing and not
process manufacturing customers.
This script is not applicable for customers using Period Average
Costing.
43
Script Input Parameters
It requires below as inputs :

Accrual Code Combination ID
Enter the Accrual Code Combination ID for the problematic Accrual
Account
Start Date
Enter the Start Date of Reconciliation in Format: DD-MON-YYYY
End Date
Enter the End Date of Reconciliation in Format: DD-MON-YYYY
Ledger ID
Enter the Ledger ID for the reconciliation
Operating Unit ID
Enter the Operating Unit ID for the reconciliation
44
Reconciliation Steps
What is accrual balance in GL for Cost Management and Payables

sources ?
What is accrual balance in SLA for Cost Management and Payables
sources ?
Whether GL and SLA balances are matching ?
If not matching check for known causes
In upgraded instance
Is the respective periods upgraded ?
Is there records missing gl sl link id ?
Is there is any unposted journals ?
Any data with Negative Ledger_id in GL tables. ?
Any data marked as transferred in SLA but not reached GL. ?
Any data marked as not transferred in SLA, but reached GL ?
45
Some of the Related KM Notes

Doc ID 1478292.1 -R12 Accrual Reconciliation Diagnostics And Troubleshooting Guide
Doc ID 1107953.1 -R12 Accrual Balance Mismatch Between Accrual Reconciliation Report
and GL - Troubleshooting
Doc ID 1117353.1 - R12: Discrepancies with Accrual Reconciliation Report Troubleshooting
Doc ID 866733.1 -How To Diagnose Inventory Accruals And Accrual Write Off Issues
Doc ID 1126025.1 -R12: Discrepancies With Accrual Reconciliation Report For Consigned
Items - Troubleshooting
Doc ID 883557.1 -R12: How To Avoid and Fix Corruption in Data Transfer from SLA Negative Ledger_ID, Not Reached GL, Duplicate in GL
Doc ID 604893.1 -R12.0 and R12.1: FAQ for the SLA Upgrade: SLA Pre-Upgrade, PostUpgrade, and Hot Patch
Doc ID 1472099.1 -Missing Accounting Entries In SLA For Transactions In Upgraded

Periods
46
Agenda
Setups
Accrual Data flow
Demonstration
47
D E M O N S T R A T I O N
48
49
How to find the questions asked during the webcast?

Navigate to the Procurement community find a post with the name ADVISOR WEBCAST: UNDERSTANDING ACCRUAL
RECONCILIATION PROCESS AND TROUBLESHOOTING IN R12
50
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51
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Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Future Advisor Webcasts

Upcoming live webcasts and recent recordings:

Use document ((Doc ID 1456150.1))

Current Advisor Webcast Schedule

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Safe Harbor Statement

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

<Insert Picture Here>

Understanding Accrual Reconciliation process and

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Accruals are accumulation of expense that is recognized before

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Types of Purchase Accruals

Types of Purchase Accruals

Period end Accruals

Inventory and Expense items

Only Expense items

Accruals generated while saving the

Accruals generated during period end

Accruals can be viewed from View

Cannot be viewed from View

Accruals are knocked off when

Accruals are reversed in next period.

Accrue On Receipt = Yes

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Accrual Accounting Entries

Period end Accruals

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Defining Expense Accrual Options

Expense A/P accrual account

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Setup Expense AP Accrual Account

select expense_accrual_code,inventory_accrual_code,accrued_code_combination_id from

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Setup Inventory Accrual Account

Inventory A/P accrual account

Inventory responsibility > Organization >Parameters > Other

Declare the accruals accounts

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Setup Inventory Accrual Account

select ap_accrual_account from mtl_parameters where organization_id=&INV_ORG_ID;

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Setup Accrual Accounts

select * from cst_accrual_accounts where operating_unit_id=&OU_ID

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Accrual Reconciliation Programs

Below programs are used for online accrual reconciliation process

AP and PO Accrual Reconciliation Report

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Accrual Reconciliation Programs

Create Accounting Receiving / Cost Management

Transfer Journal Entries to GL

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Purchase Accrual Process

Create AccountingReceiving/Cost Mgt

Transfer Journal Entries to

Copyright 2013, Oracle and/or its affiliates. All rights reserved.

Inventory Accrual Process

Transfer Journal Entries to

Copyright 2013, Oracle and/or its affiliates. All rights reserved.