FAQ Oracle

Frequently Asked Questions in Oracle Financials
ORACLE PAYABLES
1.What are the modules that are interfaced with Oracle payables?
General Ledger, Purchasing.
2. How does the financial information defaults in payables?
Financial Option > Payables > Supplier > Supplier Site > Invoice > Distribution and
Schedule of Payment.
3. What is a distribution set? What are the types of distribution set?
Distribution Set is to automatically distribute Invoice amount in to different GL
Account code Combination.
Type of Distribution Set
Full Distribution and Skeleton Distribution Set
Full Distribution means we know the exact percentage and exact account code
combination. The sum of the distribution percentages must equal 100 or 0.
Whereas in Skeleton we dont the percentage but we know the GL Account Code
Combination. So percentage should not be entered here.
4. What are the types of invoices used in payables?
Standard, Credit Memo, Debit Memo, Mixed, Prepayment, Expense Report,
Withholding Tax, PO Default, Quick Match.
5. What are the encumbrance options for AP? How are they used?
Requisition Encumbrance, and PO Encumbrance available in Financial Option.
Encumbrance used to reserve the Funds at the time of raising the Requisition or
creating of PO.
6. What are the different types of supplier sites?
Pay, Primary Pay, RFQ, Purchasing, Procurement Card.
7. What are the types of Accounting Methods?
Accrual, Cash.
8. What is Automatic Offset Methods?
Payables automatically create balancing accounting entries for your invoice and
payment transactions.
Three types of Offset Methods 1. None, 2.Balancing, 3. Account.
9. What is Pay Group?
Pay Group is to group invoices into supplier category for payments.

10. How do you create interest invoice?
In Payable Option under Interest Tab Allow Interest Invoices. Enable this option if
you want to allow Payables to calculate interest for overdue invoices and create
interest invoices for selected suppliers. Payables automatically create interest invoices
when you pay overdue invoices in a payment batch or with a Quick payment. If you
pay an overdue invoice using a manual payment, Payables warns you that interest is
due on the invoice and you should pay the invoice in a payment batch or with a Quick
payment.
11. What is GL Date Basis & Prepayment settlement date?
The date you want Payables to use as the default accounting date for invoices during
invoice entry.
Invoice Date. Invoice date you enter during invoice entry.
System Date. Current date for your Payables system. The date you enter
the invoice.
Goods Received/Invoice Date. Date that you enter in the Date Goods
Received field. If no value is entered, then the invoice date is used.
Goods Received/System Date. Date that you enter in the Date Goods
Received field. If no value is entered, then the system date is used.
Prepayment Settlement Days. Number of days you want Payables to add to the
system date to calculate a default settlement date for a prepayment. Payables prevent
you from applying the prepayment to an invoice until on or after the settlement date.
12. What are the levels of Tax calculation?
Level at which the tax has to be calculated.
Levels: line level, header level and tax code level
13. What is additional Pay through Days?
Days specified in this column is added to the system date to select the invoice for
payment which has the maturity date falling within these days
14. What are Term date basis & pay date basis?
Term date basis
Date from which the due date will be calculated based on the payment term.
Pay date basis
Selection criteria of invoices based on the due date or scheduled discount date.
15. What is with holding invoice and what are its steps?
Invoice created on the withheld amount that has to be paid to the tax authority from the
supplier.

Types: Manual and automatic with holding. Only when allow manual withholding is
enabled manual creation of invoice is possible.
Steps: Enable use withhold invoice, Select option when to apply and to create withhold
invoice.
16. What are the types of payment terms?
Immediate, 30days, fixed due date, installments, proximal.
17. What are holds in payables? How are they defined?
Restriction on the invoice for further processing.
Types: Manual and system holds. User can define any types of holds and can be
attached to the invoice to stop further processing.
18. How do you create a foreign currency invoice and a foreign currency payment?
Any invoice that has been created from other than the functional currency.
Steps: Payables option, in currency tab enables use multiple currencies.
Making foreign currency payment
In the payment format enable multiple currency option and in bank enable multiple
currency payments under payable option tab.
19. What are Expenses Report and Expense Report Template?
Invoice created for the expense made by the employee.
Expense report template
Defining default values for expense items, and you can then choose those items from a
list of values when you enter expense reports.
20. What are recurring invoices?
A feature that lets you create invoices for an expense that occurs regularly and is
not usually invoiced. Monthly rents and lease payments are examples of typical
recurring payments.
21. What are the perquisites for entering a Standard Invoice?
Supplier, supplier site, payment term, payment method, distribution set (optional).
22. What are Tax Recovery Rules?
Rules defined for the amount of taxes that has to be recovered which is usually a
function of the nature (or intended use) of the taxable item.

23. What are payment formats and payables documents?
Format in which the stationary has to be builder i.e. where the attributes or the contents
have to be placed.
Payment document
It is the actual negotiable or the legal document presented to the supplier.
24. What are the types of payment methods?
Check, electronic, wire, clearing, future dated (bill of exchange). Two places where
you assign the method one is financials option at supplier payables tab and
he
override option at supplier site level, payable tab.
25. What are the different types of payment methods?
Manual, quick and refund.
26. What are the different types of taxes used in payables?
Sales use tax, offset, user-defined, withholding tax.
27. What are withholding taxes? How are they applied on invoices in payables?
Used for deducting part of amount from suppliers invoice.
Types:
1. Flat rate: Flat rate for all invoices.
2. Period: Amount is specified for that period, beyond which the tax is not
withholder with use of special calendar.
3. Amount: Gross amount--- Invoice and period
4. Withheld amount--- Invoice and period.
28. What are Withholding Exceptions and Certificates?
You define a certificate to specify a rate exception for a Withholding Tax type tax code
for all invoices of a supplier site.
Withholding Exceptions
You define exceptions on the applied withholding tax type tax code rate assigned to an
invoice number.
29. What is future dated payment method?
Payment of invoice where the due date (maturity date) falls in the future.ex- bill of
exchange.
Steps: Enable future date use in the future dated payments tab at the payables
document.

30. How do you control accounting periods in payables?
Setupaccountingape accounting periods
There is option of toggling between various status.neveropened, future, open, closed,
permanently closed.
31. What are the Payment Programs?
The following are the Payment Programs which is used in the payment batches.
1.
2.
3.
Build Payment Programs

Format Payment Programs
Separate Remittance Programs.
Build Payment Programs
It groups the Invoices of the suppliers in the manner in which payment should be made.
Format Payment Programs
This program is used to know the layout of the payment documents and accordingly
format the payments.
Separate Remittance Programs
If the Payment Documents does not contain the Remittance advice, then we need to run
the Separate Remittance Programs other this will run along with Payment Documents.
32. What is difference between entering Invoices in Invoice Gateway and Invoice
Work Bench Window?
Invoice Workbench used for entering and maintaining more complex invoices for which
you require extensive online validation and online defaulting where as Invoice Gateway
used for your everyday entry of invoice records. Use this window for rapid, highvolume
entry of Standard and Credit Memo invoices that are not complex and do not require
extensive online validation or defaulting of values during entry.
When you use the Invoice Gateway, you enter invoice header and line information in the
same window, and can view only one record at a time. In the Invoice Workbench, you
enter invoice header information in the Invoices window, and the related invoice
distributions in the Distributions window. You can view multiple invoices at the same
time in the Invoices window.
In the Invoice Workbench we can enter and apply prepayments. In the Invoice Gateway
we cannot enter prepayments, but we can apply existing prepayments to invoices you
enter.
33. What are the tables involved in AP Invoice Interface?

1) AP_INVOICES_INTERFACE
2) AP_INVOICE_LINES_INTERFACE
34. What is Peroration of Invoice Lines?
When you check the Prorate in the Invoice Lines it will prorate expenses and Tax
according to the Proportion of Line amount in the Invoice.
35. What are the Offset Taxes? Where it is used?

Offset Taxes
Offset tax codes are used to record selfassessed taxes on invoices, while reducing or
completely offsetting tax liability. Offset taxes have negativeamount rates, so when you
use them, you enter negativeamount invoice tax distributions.
It used in European Union, if you are a member of the European Union (EU), you can
report on these zerorated taxes using the IntraEU VAT Audit Trail report.
36. What are the types of Holds that are used to prevent the payment of Invoice?
Holds that we can apply manually or that Payables applies, prevent payment and, in some
cases, creation of accounting entries for an invoice. We can remove holds that we apply,
and we can manually release certain holds that Payables applies during Approval.
Payables provide some generic invoice holds for our use, and we can define our own,
based on our invoice approval needs. We can also prevent payment of supplier invoices
by placing a hold on the supplier rather than on each individual invoice.
There are two major category of hold 1] Manual Hold 2] System Hold.
Manual hold we can create and release manually where as system hold is created by
system and normally released by system after due rectification.
There are three types of holds we can use to prevent payment of an invoice
Invoice Hold. We can manually apply one or more Invoice Hold Reason Approvals
(holds) to an invoice using the Invoice Holds window of the Invoice Workbench.
Scheduled Payment Hold. We can hold payment on part of an invoice by placing one or
more of the scheduled payments on hold in the Scheduled Payments window of the
Invoice Workbench.
Supplier Hold. In the Supplier Sites window, we can enable the Hold All Payments,
Hold Unapproved Invoices, or Hold Unmatched Invoices options. We also have the
option of
Specifying an Invoice Amount Limit for a supplier site.

37. What is the hold option at the supplier Site?
In the Supplier Sites window, we can enable the Hold All Payments, Hold Unapproved
Invoices, or Hold Unmatched Invoices options. We also have the option of specifying an
Invoice Amount Limit for a supplier site.
38. What are the ways in which invoice can be approved?
Before you can pay or create accounting entries for an invoice, including prepayments,
you must submit Approval for the invoice in one of three ways:
Online by using the Invoice Actions window.
Online by using the Approve button in the Invoice Batches
Batch by submitting the Payables Approval program from the Submit Request
window.
39. What are the methods of taking Discounts in Payables?
There are two ways to take discounts with Payables:
Enable the Always Take Discount Supplier option. Payables take a discount
regardless of when you pay the invoice.
Select Discount for the Pay Date Basis for the supplier, and disable the Pay
Only When Due check box for your payment batch. Payables take a discount and
pay the invoice within the discount period.
40. What are the matching approval Levels?
Match Approval Level. If we use Oracle Payables with Oracle Purchasing or another
integrated purchasing product, we can perform online matching of invoices and original
purchase orders or purchase order receipts. Matching ensures that we only pay for the
goods and services we ordered and that our suppliers do not overbill us. If we are billed
for an item over the amount and quantity tolerances we define, the Payables Approval
Program applies holds to the invoice and prevents payment until we release the holds.
41. What is the Payable Open Interface Table?
The Payables Open Interface tables store invoice information. The Payables Open
Interface Import program builds Payables invoices based on the invoice records in the
Payables Open Interface tables.
After the import program builds the invoices, they can be viewed, modified, and
approved in the Invoice Workbench.
The invoice data is from eCommerce invoices from your suppliers, invoice records that
you entered in the Invoice Gateway window, invoices that you loaded with Oracle
SQL*Loader, lease invoices that were transferred from Property Manager, and credit card
transaction data.

42. What is the Invoice Matching Option?
The following are the Invoice Matching Option available:
1) Purchase Order Matching
2Way. When you match to a purchase order or receipt, Payables Approval performs
these control checks:
1. Quantity billed <= Quantity ordered
2. Invoice price <= Purchase order price
2) Receipts Matching
3Way. Control checks 1 and 2, plus:

3. Quantity billed <= Quantity received
3) Invoice Matching
4Way. Control checks 1, 2, and 3, plus:

4. Quantity billed <= Quantity accepted
43. What is the Prepayment Invoice? What are the Types of Prepayment Invoice?
A prepayment is a type of invoice we enter to make an advance payment
to a supplier or employee.
The Following are the Two Types of Prepayments
1.
2.
Temporary and
Permanent.
Temporary prepayments can be applied to invoices or expense reports you receive.

Permanent prepayments cannot be applied to invoices.
44. What is the purchase order matching database table?
Payables use several of Oracle Purchasing tables for matching. To implement matching
in Payables, you need to load these tables with the data from your nonOracle purchasing
application.
The following are the list of such tables:
PO_HEADERS
PO_LINES
PO_LINE_LOCATIONS
PO_DISTRIBUTIONS
PO_DISTRIBUTIONS_AP_V (view of PO_DISTRIBUTIONS)
PO_RELEASES (Blanket Purchase Orders)
PO_LOOKUP_CODES
Auto Install automatically installs these and other necessary Oracle Purchasing
application tables when you install Payables.
45. What are the pre-requisites for entering Payments?
The following are the pre-requisites:
1.
The invoice(s) we paid must be approved, unconcealed, validated,
without holds, and must have the same currency as the payment.
2.
The bank account must have at least one payment document that uses the
Recorded or Combined disbursement type.
46. What are the stages in Payment Batches?
Building. Payables are determining which invoices will be paid by each payment
document.
Built. Payables have determined which invoices will be paid with each payment
document. You can now review the Preliminary
Payment Register, Modify the Payment Batch, or Format the Payment Batch.
Cancelled. You have cancelled the payment batch.
Cancelling. Payables are cancelling the payment batch.
Confirmed. You have confirmed the payment batch.
Confirming. Payables is either confirming or partially confirming the payment batch
based on the action you selected in
The Confirm Payment Batch window.
Formatted. Payables has completed formatting your payments and has created the output
file that you can use to print checks or,
If you are making electronic payments, you can deliver the output file to the e
Commerce Gateway or your bank for processing.
Formatting. Payables has created the output file that you can use to print checks or, if
you are making EFT payments, you can
Deliver the output file to your bank for processing.
Modified. Payables have modified the payment batch based on the modifications you
made in the Modify Payment Batch window.
Modifying. Payables are modifying the payment batch based on the modifications you
made in the Modify Payment Batch window.
Rebuilding. You have modified a payment batch, and Payables is rebuilding the
modified payment batch.

Restarting. You have confirmed a partial payment batch and have chosen Restart
Payment Batch in the Confirm Payment Batch window. Payables is rebuilding and
reformatting the remaining portion of the payment batch.
Selected. Payables have selected invoices that match the payment batch criteria you
entered.
Selecting. Payables are selecting invoices that match the payment batch criteria you
entered.
Unstated. The payment batch is UN started.
Oracle Receivables
1. What are the two key flex fields in Oracle Receivables and what is its purpose?
Location Flex field: - Mandatory
This Flex field is used for calculating the Location based tax (i.e.) Sales tax.
Territory Flex field: (Max 20 segments) - Optional
This Flex field is used for tracking the location in which the sale is taking place.
This Flex field is for ascertaining the profitability of each of the sales location through
generating reports.
2. What are the modules that are interfaced with Oracle Receivables?
I. General Ledger
Ii. Order Management
iii. Fixed Asset
iv. Inventory
3. What is Auto invoice? What are its related setup steps?

Auto invoice is the process used for importing the transactions from feeder modules
like project accounting, order entry etc.
And also from existing applications/systems if the receivable module is installed for the
first time.
To invoke auto invoicing the navigations is
Interfaces: Auto Invoices

Run a program called Auto Invoice Master Program and specify the Invoice source
and submit it.
If any error occurred during validation all the transactions will be stored in the below
mentioned tables
RA_INTERFACE_ERRORS_ALL .
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4. What is the database tables involved for performing Auto invoice?
1. RA_INTERFACE_LINES_ALL
2. RA_INTERFACE_SALESCREDITS_ALL
3. RA_INTERFACE_DISTRIBUTIONS_ALL
5. What is an Application Rule set?

Application rule sets specify the default payment steps for your receipt applications and
how discounts affect the open balance for each type of associated charges. By defining
your own application rule set, you can determine how Receivables reduces the balance
due for a transactions line, tax, freight, and finance charges.
Receivables provide the following application rules:
Line First - Tax After: Apply to the open line item amount first.
Apply any remaining amount in the following order: tax, freight, and
then finance charges.
Line First - Tax Prorate: Apply a proportionate amount to the open

line item amount and the open tax amount for each line. Apply any
remaining amount to freight and then to finance charges.
Prorate All: Apply a proportionate amount to the line, tax, freight,

and finance charges.
6. What is a flexible address format? How can a user-defined format be defined and
where will this be affected?
Oracle Applications let you enter customer, supplier, bank, check, and remitto addresses
in countryspecific formats. For example, if you have customers in Germany, you can
enter German addresses in the format recommended by the Budapest, or you can enter
addresses for customers in the United Kingdom in the format recommended by the Royal
Mail.
This is done by using descriptive flex fields to enter and display address information in
the appropriate formats. The flex field window opens if the country you enter has a
flexible address style assigned to it, which lets you enter an address in the layout
associated with that country. If there is no address style associated with the country,
Oracle Receivables uses the standard address format.
Attention: (Receivables users only) If you use a Sales Tax Location Flex field that
contains a segment other than country and wish to set up a flexible address format for
your home
Country, every component in your Sales Tax Location Flex field structure must also exist
in your flexible address style for that country.
7. What do you mean by Auto Accounting?
It helps the Receivables to determine the general ledger accounts for transactions that
are entered manually or import using Auto Invoice.
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Receivables creates default accounts for revenue, receivable, freight, tax, unearned
revenue, unbilled receivable, finance charges, bills receivables accounts, and Auto
Invoice clearing (suspense) accounts using this information.
When you enter transactions in Receivables, you can override the default general
ledger accounts that Auto Accounting creates.
You can control the value that Auto Accounting assigns to each segment of your
Accounting Flex field, such as Company, Division, or
Account.
You must define Auto Accounting before you can enter transactions in Receivables.
8. What are the different classes of Transactions available in Receivables?
(I) Chargeback (ii) Debit Memo (iii) Credit Memo (IV) Deposit (v) Guarantee (VI)
Invoice
9. What are Transaction Sources?
Receivables uses transaction sources to control the transaction and transaction batch
numbering, provide default transaction types for transactions in batch, and to select
validation options for imported transactions. Receivables provide the following
predefined transaction sources: MANUALOTHER, DM Reversal, and Chargeback.
10. What are Adjustment Approval Limits? Where & why are they used?
Approval limits, defined in the approval limits window are used for adjustments
created in receivables and request for credit Memos initiated from I-Receivables.
Receivables use transactions that have a document type of Adjustment when we
create an adjustment in the Adjustments, Submit Auto Adjustments and Approve
Adjustments windows.
When you enter an adjustment that is outside the approval limit range, Receivables
assigns the adjustment a status of pending until someone with the appropriate
approval limits either approves or rejects it.
11. What are the pre-requisites for entering a standard invoice in Receivables?
Transaction source and Transaction Type, Customer with Business purpose usage
and payment terms should have been predefined. And the class should be selected as
Invoice.
12. What are the types of tax methods in Receivables?
(I) Location Based Tax (i.e.) Sales Tax
(ii) VAT Tax
13. What is an Auto cash Rules?

Auto cash rule set provides a set of rules which Receivables should follow for
applying the receipts against the transactions. The default auto cash rule set can be
specified in the System Option.
14. What are Accounting Rules and Invoicing Rules? Where it is used?
Accounting rules is to create revenue recognition schedules for the invoices.
Accounting rules determine the number of periods and
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Percentage of total revenue to record in each accounting period. It can be used with
transactions that are imported into Receivables using Auto Invoice and with invoices that
was created manually in the Transaction windows.
If you want to credit an invoice that uses invoice and accounting rules to schedule
revenue and billed receivable recognition, you can specify
How you want to adjust this invoices revenue account assignments by choosing a Rules
Method in the Credit Memos window.
You can assign a default accounting rule to your items in the Master Item window
(Invoicing tabbed region) and to your Standard Memo
Lines in the Standard Memo Lines window.
Attention: Invoicing and Accounting Rules are not applicable if you are using the Cash
Basis method of accounting. If you use the Cash Basis method, Auto Invoice will reject
any transaction lines that are associated with invoice or accounting rules.
15. What is revenue recognition?
Run the Revenue Recognition program to generate the revenue distribution records for
your invoices and credit memos that use
Invoicing and Accounting Rules. You assign accounting rules to recognize revenue over
several accounting periods. The Revenue Recognition program will create distribution
records for the invoices and credit memos that you create in Receivables and import
using Auto Invoice.
The Revenue Recognition program uses the accounting distribution sets that you specify
in the Transactions window or import into Receivables
Using Auto Invoice to determine the accounts of your newly created revenue distribution
records.
There are two Revenue Recognition programs: Revenue Recognition and Revenue
Recognition Master. The Revenue Recognition Master program is for parallel processing
only and takes advantage of the Oracle scalability feature to reduce processing time by
running on multiple processors, or workers. The Revenue Recognition Master program
determines the maximum number of parallel processors needed for your transaction
volume and uniformly distributes the processing over these workers. You can set a
maximum number of processors for the Revenue Recognition Master program to use at
runtime. This scheduling capability allows you to take advantage of offpeak processing
time. You choose the Revenue Recognition program that you want to use at runtime.
16. What are the pre-requisites for entering a Manual receipt in AR?
Invoices should have been defined against which the receipts will be applied and
the payment method should be predefined and attached to the receipts.
17. What is a Receivable Activity?
It is an activity specific to the organizational needs for Miscellaneous Receipts,
Finance Charges, Bank Errors and Adjustment transactions.
18. What are Receipt Classes and Receipt Sources?
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Receipt Class: It is to define the processing steps, payment method name, and
remittance bank for processing the payments received from customers.
Receipt Source: It will be used to enter receipts in batches for both manual and
automatic receipts. It is a grouping of Receipt class, Payment method and Remittance
bank account.
19. What are Statement Cycles? How can you print a Statement for a customer?
Statement cycles are to determine when to send statements to the customers. You
assign these cycles to your customer and site level profiles. Receivables let you generate
statements for all customers associated with a specific statement cycle.
20. What is Auto lockbox? What are its related steps?
Auto Lockbox (or Lockbox) is a service that commercial banks offer corporate
customers to enable them to outsource their accounts receivable payment processing. An
Auto Lockbox operation can process millions of transactions a month.
Auto Lockbox eliminates manual data entry by automatically processing receipts that are
sent directly to your bank. You specify how you want this information transmitted and
Receivables ensures that the data is valid before creating Quick Cash receipt batches.
You can automatically identify the customer who remitted the receipt and optionally use
Auto Cash rules to determine how to apply the receipts to your customers outstanding
debit items.
You can also use Auto Lockbox for historical data conversion. For example, you can use
Auto Lockbox to transfer receipts from your previous accounting system into
Receivables. Auto Lockbox ensures that the receipts are accurate and valid before
transferring them into Receivables.
Auto Lockbox is a three step process:
1. Import: During this step, Auto Lockbox reads and formats the data from your bank file
into the Auto Lockbox table using an SQL*Loader script.
2. Validation: The validation program checks data in theAutoLockbox tables for
compatibility with Receivables. Once validated, the data is transferred into QuickCash
tables. At this point, you can optionally query your receipts in the QuickCashwindow and
change how they will be applied before submitting the final step, Post QuickCash.
3. Post QuickCash: This step applies the receipts and updates your customers balances.
21. What is an Aging Bucket?
Aging Bucket are time periods that are used to review and report on open
receivables. For example. The 4 bucket aging bucket that receivables provides
consists of 4 periods:
(I) -999 - 0 past due (ii) 1 - 31 days past due (iii) 31 - 61 days past due (IV) 61 - 91
days past due
When we create our collection reports or view our customer accounts, we can
specify an Aging Bucket and as of date and Receivables will group the transaction
and their amounts in the appropriate days past due period.
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22. What are Tax Exemptions, Tax Exceptions and Tax Groups?
Exemptions: It is to reduce the gross tax associated with a tax code and enables us
to arrive at the effective tax rate. It can be applied on customers, items and Range of
items. It can be restricted to the specific locations of the customers. The tax
authorities can specify exceptions for Location based taxes and Vat.
Exceptions : When the tax authorities provides a different Location based tax rate
for the inventory items sent to specific Locations, this rate is referred to as Tax
Exception rates. It can be applicable for individual Inventory or range of Items and
not for customers.
Tax Groups: It is used to group multiple VAT codes. Hence we can apply
multiple VAT codes to a single distribution line.
For Example: Grouping GST and Ontario PST and apply that tax group to a
distribution line. The tax calculation creates two tax lines, one for GST and
other for Ontario PST.
23. What are Dunning Letters?

Dunning Letters are the Warning/Reminder letters to the customers for their overdues.
24. What are Grouping Rules and Line Ordering Rules?
Grouping Rules: It specifies how the lines, which have been imported from external
sources, should be grouped into Invoices, Debit memo and Credit memos. Auto
Invoices requires mandatory grouping of certain transactions attributes. Receivables
automatically apply these mandatory transactions to any grouping rule which have
been defined. Therefore the grouping rules specify the attributes, which should be
identical across the lines, so that they can form part of one transaction.
Line Ordering Rules: It specifies the order and number in which the lines will
appear in the transaction after it is grouped. We can attach the Line Ordering Rule to
the same grouping rule. Line ordering Rule is optional.
25. What are Bill Receivable Transactions? What are its related setup steps?
A bill receivable is a document that your customer formally agrees to pay at some
future date (the maturity date). The bill receivable
Document effectively replaces, for the related amount, the open debt exchanged for the
bill. Bills receivable are often remitted for collection and used to secure short term
funding.
Related Setup Steps:
26. What is taxable Basis available for a Tax Code?

(I) Before Tax (ii) After Tax (iii) Prior Tax (iv) Quantity Based Tax.
27. What are the various Discount bases available for defining a payment term?
Invoice Amount: Calculate the discount amount based on the sum of the tax, freight
charges, and line amounts of your invoices.
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Lines Only: Calculate the discount amount based on only the line amounts of your
invoices.
Lines, Freight Items and Tax: Calculate the discount amount based on the amount of
line items, freight, and tax of your invoices, but not freight and charges at the invoice
header level.
Lines and Tax, not Freight Items and Tax: Calculate the discount amount based on the
line items and their tax amounts, but not the freight items and their tax lines, of your
invoices.
28. What are Natural Application only and Allow over Application options in
transaction types?
Natural Application Only: Receivables does not allow the creation sign (Positive,
Negative or any sign) of the transaction to be changed by virtue of receipt application
or any other activity against the transaction. For Example : if the Receipt is $1500
against the Invoice value of $1000 then the Receivable allows only $1000 to be
applied against the transaction and thus the balance is brought down to 0.
Allow Over Application: Receivables will allow the transactions to be over applied.
If the Receipt is $1500 against the Invoice value of $1000 then the receivables will
allow the entire balance and the due for the transaction will become -$500. (i.e.,) It
will allow the creation sign to be violated.
29. What are Transmission Formats? What are the transmission formats provided
by receivables?
Transmission format window is used to define the transmission formats that auto
lockbox uses when importing data into receivables. Transmission formats specify
how data in the lockbox bank file is organized so that it can be successfully imported
into the receivables interface tables.
1. Example (arxmpl.ctl): A format that contains an example of lockbox header
information, several receipt records, and overflow receipt records
2. Default (ardefd.ctl): A standard BAI (Bank Administration Institute) format used
by most banks.
3. Convert (arconv.ctl) : A standard format used for transferring payment
information from other systems.
4. Cross Currency (arxcurr.ctl) : A default format used for importing cross currency
receipts.
5. Zinging (arzeng.ctl): A format used to import bank files in the Japanese Zen gin
format (Alternate Names Receipt Matching Window)
30. What are various Business Purpose Usages given by receivables, which can be
assigned to a customer?
Ship-to, Bill-to, Statement, Dunning, Legal, Marketing Etc. are the various Business
purpose Usages given by Receivables. The Bill-to site is mandatory for customers. Others
are Optional.
16

31. What are Customer Profile Classes?
The Customers are categorized in terms of their credit worthiness, credit limits
offered to them, payment terms, finance charges percentage etc. This process of
setting the profile parameters for each category of customers is referred to as the
profile class.
32. What are the Customer Interface Tables provided in AR?
RA_CUSTOMER_INTERFACE.
RA_CUSTOMER_PROFILES_INTERFACE.
RA_CUSTOMER_BANKS_INTERFACE.
RA_CUST_PAY_METHOD_INTERFACE.
RA_CONTACT_PHONES_INTERFACE
33. What are Standard Memo Lines?
Memo lines are used to increase the customer balance which could be due to
omission of tax, freight, charges, and consultation charges.
34. What is the Transaction Process of invoices with Rules?
Invoicing rules let you determine when to recognize your receivable for invoices that
span more than one accounting period. You can assign
invoicing rules to invoices
that you manually enter or import into Receivables through Auto Invoice. Receivables
provide the following invoicing rules:
Bill in Advance: Use this rule to recognize your receivable
immediately.
Bill in Arrears: Use this rule to recognize the receivable at the end
of the revenue recognition schedule.
Once rules have been associated with an invoice, Receivables creates the revenue
distributions for the invoice when you run
the Revenue Recognition
program for the period in which the rules fall.
35. What is the difference between Deposit and Guarantee Transactions?
Deposit: It is the pre-payments made by a customer that should be adjusted against
the future debit transactions that are raised with respect to these pre-payments.
Guarantee: It is a documentation of the promise made by the customer to obtain the
goods from the organization. This promise is documented as a guarantee. The
customer does not make payment for the guarantee.
36. What are the methods of creating credit transactions?
37. What are methods of creating batch receipts?

There are three methods of creating batch receipts:
1. Manual Entry 2. Manual Quick 3. Automatic.
17

38. What are Standard and Factoring Methods of Remittance?
Standard remittance: The supplier remits the bills of exchange to the bank for
collection and the same will be collected on the maturity date of the note.
Factored remittance: It means discounting the bills of exchange with the bank
before the maturity date. The onus of collection could be with recourse or without
recourse.
39. What are Standard Remittances and Bills Receivable Remittances?
Standard remittance is remitting the cheque/dd to the bank for collection.
Bills Receivable remittances means remitting the Bills Receivable to the bank for
collection on maturity date.
40. What are the various statuses for a receipt?
Approved: This receipt has been approved for automatic receipt creation. This status is
only valid for automatic receipts.
Confirmed : For manually entered receipts, this status indicates the receipt belongs to a
receipt class that requires remittance. For
automatic receipts, this status indicates the receipt has been confirmed.
Remitted : This receipt has been remitted. This status is valid for both automatic and
manually entered receipts.
Cleared : The payment of this receipt was transferred to your bank account and the
bank statement has been reconciled within
Receivables. This status is valid for both automatic and manually entered
receipts.
Reversed : This receipt has been reversed. You can reverse a receipt when your
customer stops payment on a receipt, if a receipt comes
from an account with nonsufficient funds or if you want to reenter and
reapply it in Receivables. You can reverse cash receipts and miscellaneous receipts.
41. What are chargebacks and adjustments? How to create them?
Chargeback is postponing of payment date. It can be done only in the receipts
workbench. In this process the old invoice is cancelled and a new transaction is
created for the postponed date.
42. What are Standard Reversal and Debit memo Reversal in receipts?
Standard Reversal: When you create this type of reversal, Receivables automatically
creates reversal journal entries for your general ledger and reopens all of the debit and
credit items that were closed with the original receipt. You can create a standard reversal
for a transaction related to a chargeback if there is no activity against the chargeback and
the chargeback has not been posted to the general ledger. If the chargeback has been
posted to the general ledger, you must create a debit memo reversal (see below).
If you create a standard reversal for a receipt that you have applied, Receivables reverses
any adjustments or chargebacks that you created, as long as you have not posted these
adjustments to your general ledger.
18

Debit Memo Reversal: When you create this type of reversal, Receivables does not
update any of the receipt activity associated with the original receipt. The new debit
memo reversal is actually a new receivable that replaces the item closed by the original
receipt. Receivables require that you create a debit memo reversal if:
You are reversing a receipt that you previously applied to a chargeback and this
chargeback has had any activity against it (for example, another receipt, credit
memo, or adjustment), or
the chargeback or adjustment was posted to your general ledger When you create
a debit memo for a receipt reversal, Receivables creates a line on your debit memo
that displays the original receipt number associated with the debit memo. In
addition, when you save your reversal, Receivables assigns a unique transaction
number to your new debit memo.
Attention: You cannot create a debit memo reversal for a miscellaneous (noninvoice
related) receipt.
43. What are Cross Currency Receipts? How do you create them?
When your customer remits payment for an invoice, debit memo, or chargeback, the
receipt is usually in the same currency as the transaction. However, there may be times
when your customer remits payment in a currency that is different than the currency of
the open debit item. For these occasions, Receivables lets you create cross currency
receipt applications to let you fully or partially process the payment.
For example, you create Invoice 101 in Canadian dollars (CAD) but your customer sends
a receipt in Deutsche marks (DEM) as payment.
Using the remittance information provided by your customer, you can either fully or
partially apply this receipt to Invoice 101. Receivables automatically calculate the open
balance on the invoice (if any) and the foreign exchange gain or loss (FXGL) for this
application.
You can apply receipts to transactions using any currency defined in Oracle General
Ledger.
44. What are the setups related to Automatic Receipts?
Receivables automatic receipts feature to automatically generate receipts for customers
with whom you have predefined agreements. These agreements let you collect payments
on time by transferring funds from the customers bank account to yours on the receipt
maturity date. You can also manage your cash flow by deciding when, where, and how
much you should remit to your bank.
Creating automatic receipts involves three steps:
Create: Select the invoices to include in your automatic receipts.
Approve: Update, delete, and approve the receipts that you have selected.
Format: Format your automatic receipts onto paper to send to your customer for
confirmation or notification before remitting them to your bank on either paper or
magnetic media. This step is optional, as it depends upon the type of automatic receipt
you create.
45. What are the clearance methods in Receivables and how are they used?
19

Directly: Choose this method if you do not expect the receipts to be remitted to the bank
and subsequently cleared. These receipts will be assumed to be cleared at the time of
receipt entry and will require no further processing. Choosing this method is the same as
setting Require Bank Clearance to No in previous releases of Receivables.
By Automatic Clearing: Choose this method to clear receipts using the Automatic
Clearing program.
By Matching: Choose this method if you want to clear your receipts manually in Oracle
Cash Management.
ORACLE GL QUESTIONS
1. What is a Flex Field? What are Key and Descriptive Flexfields?

A flex field is a field made up of subfields, or segments.
Two Types
A. Key Flex fields
B.Descriptive Flex fields.
A. Key Flex fields
Key Flex fields are an intelligent key code made up of sections, where one or more parts
may have meaning. An intelligent key code uniquely identifies an object such as on
account, an asset, a part or a job. Intelligent keys are useful in applications because they
are usually easier for a user to remember and use than a unique number.
B Descriptive Flex fields
Descriptive flex fields provide customizable expansion space on forms. We can use
descriptive flex fields to track additional information, important and unique to the
business that would not otherwise be captured by the form. A descriptive flex field
appears on a form as a singlecharacter, unnamed field enclosed in brackets. Each field
or segment in a descriptive flex field has a prompt, just like ordinary fields.
2. What is the key flex field name in GL?
Accounting Key flex field
3. What is segment? What are the maximum segments that can be there for GL?
A segment is a single subfield within a flex field. A segment is represented in database
as a single table column.
Maximum 30 Segments
4. How many Flex field Structures can you create for GL?
In Oracle General Ledger, we can have n no of flex fields structures.
20

5. What is a value Set? What are the format types and validation types available in
value set?
Value set
A group of values and related attributes assigned to an account segment or to a
descriptive flex field segment. Values in each value set have the same maximum
length, validation type, alphanumeric option, and so on.
Format types:
Character
Date
Date time
Standard Date
Standard Date time
Time
Validation types:
Dependent
Independent
None
Pair
Special
Table
Translatable Independent
Translatable Dependent
6. What are flex field Qualifiers and Segment Qualifiers?
Flex field Qualifiers
A flex field qualifier identifies a particular segment of a key flex field. It is to identify a
particular segment for the purpose like security or computations. A flex field qualifier
acts as an identification tag for a segment.
Segment Qualifiers
A segment qualifier identifies a particular type of value in a single segment of a key flex
field. A segment qualifier acts as an identification tag for a value. In the Accounting
Flex field, segment qualifiers can identify the account type for a natural account segment
value, and determine whether detail posting or budgeting are allowed for a particular
value.
7. What are the flex field Qualifiers and Segment Qualifiers available in GL?
Flex field Qualifiers
Balancing Segment
Natural Account Segment
Cost Center Segment
Inter Company Segment
: Company
: Account
Segment Qualifiers:
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For Company : Allow Posting & Allow Budgeting
For Account : Allow Posting, Allow Budgeting, Account type, Control Account &
Reconciliation Flag
In Account type: Asset, Expenses, Liability, Ownership/Stockholders Equity & Revenue
8. What do you mean by Dynamic Inserts?

A feature specific to key flex fields that allows entering and defining new combinations
of segment values directly into a flex field pop-up window. The new combination must
satisfy any cross-validation rules, before your flex field accepts the new combination.
9. What is a Roll up group?
Rollup group is to identify a group of parent values for reporting or other application
purposes. It is used to create summary accounts for reporting purposes.
10. What are Security Rules and Cross Validation Rules? How it can be set?
Security Rules
Security Rule to limit the access of different segment values for different responsibilities
To assign security rules:
1. Navigate to Security Rules window & Security rules
2. Assign it to application and responsibility that uniquely identifies the responsibility to
which we want to assign security rules.
Cross Validation Rule
A crossvalidation rule defines whether a value of a particular segment can be combined
with specific values of other segments. Crossvalidation (also known as crosssegment
validation) controls the combinations of values that we can create when we enter values
for key flex fields .It is assigned to Chart of account
11. How do you define Parent-Child Relationship for segment values?
In segment value enable the parent value, define the child range and enter the low high
ranges of child value
12. What is Chart of Accounts? What are its pre-requisites?
Chart of accounts
The account structure your organization uses to record transactions and maintain
account balances.
Pre-Requisites for Chart of Accounts
1. Segment
2. Value Set
22

3. Flexfield Qualifier
4. Values
5. Segment Qualifier
13. What are period types? What are period types provided in GL?
Period
A unit of time, such as one week, two weeks, or a month, on which your accounting
calendar is based.
Period types
1. Month
2. Year
3. Quarter
4. Half yr
5. Half month
6. Week
14. What is an Accounting Calendar?
Accounting calendar is to specify the number of periods in the year for the purpose of
transaction and maintain accounting data
15. How do you open and close period in GL?
Navigate Open/close, in open/close window click open the next period push button to
open next period
To close the period choose close option from the open period love
16. Period status in GL:
Open: Journal entry and posting allowed.
Closed: Journal entry and posting not allowed until accounting period is reopened.
Reporting and inquiry allowed.
Permanently Closed: Journal entry and posting not allowed. It cannot be reopened.
Reporting and inquiry allowed.
Never Opened: Journal entry and posting are not allowed. This is the period proceeding
the first period ever opened in the calendar, or to any period that has been defined, but is
not yet futureenterable. We cannot change this period status.
Future Entry: Journal entry is allowed, but posting is not. The period is not yet open,
but falls within the range of future-enterable periods designated in the Set of Books
window. We cannot change this period status without using the concurrent process to
open the period.
17. Transaction calendar:
This is a calendar which determines which days in a week are business days and specifies
other non-business days, such as holidays.
23

Where it is used:
It must be assigned for set of books for which average balancing is enabled to control
transaction posting.
18. Monetary currency:
Monetary currency is a currency which has monetary value
Eg: USD,INR etc...
Functional currency vs. reporting currency:
The principal currency used to record transactions and maintain accounting data within
General Ledger is functional currency where as the reporting currency is used for
financial reporting.
19. Conversion types:
A process that converts foreign currency transactions in to functional currency.
Types:
Corporate
Reporting
Spot
User
Purposes:
For Year end Reporting purposes, the foreign currency balances need to be converted into
The functional currency balances.
20. Set of Books:
A financial reporting entity that uses a particular chart of accounts, functional currency
and accounting calendar. There must be at least one set of books for each business
location.
Mandatory accounts in SOB:
Retained earning account
Suspense account
Rounding off difference account
Reserve for encumbrance
21. Prerequisites for journal:
Period
Currency
Category
Source
22. Different types journal:
Reverse journal
Tax journal
24

Statistical journal
Suspense journal
Recurring journal
Foreign currency journal
23. Journal Import:
A General Ledger program that creates journal entries from transaction data stored in the
General Ledger GL_INTERFACE table.
Steps in journal import:
GL/Journal/Import/Run->Give specific selection criteria using request id and press
import.
24. How to validate a journal import? How do you track errors during journal
import?
Validation can be done through
-Batch Level Validation
-Journal Level Validation
-Journal Entry Line Level Validation
-Account Validation
-Effective Date Validation
-Descriptive Flex field Validation
Errors can be tracked through
-Batches
-Accounts
-Reference
-Journal lines
-Descriptive Flexi fields
25. Mass allocation:
A single journal entry formula that allocates revenues and expenses across a group of cost
centers, departments, divisions, and so on.
Process steps for mass allocation:
Formula creation
Validatation
Generation
Submission
26. Types of Recurring Journal:
Regular
Skeleton
Formula-statistical
Formula-currency
25

27. Journal Sources:
It is an indicator by which General Ledger identifies and differentiates the origin of
journal entries.
Journal Categories:
Journal entry categories specify what kind of transaction the journal entry
represents. It is used to indicate the purpose or nature of your journal entry.
28. Suspense accounts
Suspense account is a balancing account which is used to post out-of-balance journal
entries; General Ledger automatically posts the journal difference against this account.
Summary account
An account whose balance represents the sum of other account balances. Summary
accounts are used for faster reporting and inquiry as well as in formulas and
allocations.
Inter company account
A general ledger account that is defined in an Accounting Flex field to balance inter
company transactions.
29 Encumbrances:
An entry is made to record anticipated expenditures of any type. We can create
requisition encumbrances and purchase order encumbrances automatically .We can have
manual encumbrances also.
Encumbrance type
Commitment
Obligation
Invoice
Labor
PO
Internal trading
30. Journal entry which dont want contra entry are:
Suspence Journal
Encumbrance journal.
26

31. Journal Approval:
This is a method whereby we set up source of journal which requires approval or
validation process.
Enter journal ---validate if approval required approve it
If approval not required
While creating the journal source Check the box REQUIRE JOURNAL APPROVAL
32. Budgetary Control
This is the option used to have control over the amount spent against budgets.
Two types
Account wise
Journal entry source & category as a way of
33. Multiple Reporting Currencies

Multiple Reporting Currencies (MRC) is a set of unique feature imbedded in Oracle
Applications that permits an organization to report in multiple functional currencies.
Using MRC, you can maintain and report accounting records at the transaction level in
more than one functional currency. You do this by defining one or more reporting sets of
books, each associated with a primary set of books. Each set of books has its own
functional currency.
34. Average Balance Processing
The amount computed by dividing an aggregate balance by the number of calendar days
in the related range.
The set up steps are in SOB Average balances tab Check ENABLE AVERAGE
BALANCES.
35. Budget
A predetermined estimate of cost for a task or cost center or a project
36. Funding Budget
Funding Budget are those budgets in which we enforce budgetary control
Non-Funding Budget
This budget is used only for reporting purpose where we dont enforce any budgetary
control.
In SOB level and under budgetary control tab enable budgetary control then all budgets
created will be funding budget by default
37. Budget Organization
An entity (depart or cost center or division or other groups) responsible for entering and
maintaining budget data.
27

We can define budget organization for the co then assign the appropriate a/c to each
budget organization.
Then that budget organization becomes responsible for entering and maintaining budget
data.
38. Budget Formulas
A mathematical expression used to calculate budget amounts based on actual results,
other budget amounts and statistics.
With Budget formulas we can automatically create budgets using complex equations,
calculations and allocations.
39. Mass Budget
Mass Budgeting gives you the flexibility to allocate budget amounts to
Ranges of accounts throughout your organization using simple
Formulas.
Process Steps:
GL/Budgets/Define/Mass
40. Difference between budget journal and budget amount
We use budget journal for funding budget
We can have audit trail only if we enter budgets thru budget journals
Budget amount is used for non-funding budget
41) How to transfer budget amounts
Under a budget we can opt to transfer budget amount from one organization to another
organization (account wise also)
Gl/Budget/transfer/select the budget from which budget we have to transfer, then choose
from budget organization
And TO organization, then allocate the a/c code combination and click transfer amounts.
42) Upload Budget
We can upload amounts from budgets developed from an outside source (eg spread sheet)
and transfer it to the GL Budget Interface table.
The utility used is ADI Application Desktop Integrator. We can upload budget amounts
to your budget organization from any existing a/c that falls
Within the a/c ranges assigned to your budget organization. At your request, gl uploads
your budget interface data and automatically updates your financial records
To include this budget information.
Once u uploads your budget data u can review the budget spread sheet upload execution
report for the status of your uploaded budget information.
43. Budgetary Control
It is an option used to control actual and anticipated expenditure against a budget
28

What is online funds checking
Funds check is the process of verifying that sufficient funds are available to cover
expenditure.
44) Funds check level Options
The Options for budgetary control settings are as follows:
Absolute: If this is selected the transactions are rejected unless funds are available
Advisory: If this is selected the transactions are approved even when no funds or
insufficient funds available (with warnings)
None
: ------------------------------do------------then all transactions are approved.
45) Budgetary control group

We define one or more budget control groups to attach to sites or users. We can create
budget control groups by specifying funds check level.
By journal source and category, together with tolerance %, amount, and an override
amount (per journal) allow for insufficient funds transactions.
We can also create additional budgetary control groups to give people different budgetary
control tolerances and abilities to override
Insufficient funds transactions.
46) What do you meant by encumbrance Accounting? What are its related setup
steps? What are the types of encumbrance?
Encumbrance
An entry made to record an anticipated expenditure of any type the primary purpose of
tracking encumbrances is to avoid overspending a budget.
Setup Step
Enable the budgetary control flag for a set of books. When you enable budgetary control
flag in set of books, the system automatically creates encumbrance from requisition,
purchase orders and other transaction from feeder system such as purchase and payable.
1. Navigate to the encumbrance type
2. Enter name and description
3. Enable encumbrance type
4. Save your work.
29

When you do not enable budget control flag, you can still enter manually encumbrance
via journal entry. You cannot do encumbrance from requisition and purchase order.
Encumbrance Type
Lets you classify and track
Commitment: Encumbrances you record when complete a purchase requisition.
Obligation: An encumbrance you record when we turn the purchase requisition into
purchase.
47. How do you create encumbrance?
You can create encumbrance either manual or automatic
48)
How to view funds available for Budget Transactions?
1. Navigate to the funds available Inquiry window

2. Enter the budget Name for the enquiry.
3. Enter the period name for the inquiry
4. Select an amount type.
5. Enter an encumbrance type. You can view all encumbrance type
By entering ALL.
6. Do one of the following:
1. Choose the find button to query all accounts that meet your selection
criteria.
2. Navigate to the funds available region and query a partial or complete account.
49. What is year end Encumbrance Processing? How is it performed?

Performing Year - end encumbrance processing
Performing year-end processing is to identify outstanding purchase order and requisition
encumbrance, to cancel some or these entire encumbrance and to carry forward
encumbrance, budget, and funds available balance in the new fiscal year
You can carry forwards encumbrance into the fiscal year. If you do not carry forwards
encumbrance, you might want to cancel existing requisition and purchase order behind
the encumbrance.
To perform year end encumbrance processing.
30

1. Identify outstanding encumbrance in oracle purchasing to determine which
encumbrance to cancel or to carry forward.
2. Review purchase order and requisition encumbrance by requesting the following
reports.
a) Encumbrance Details Report in oracle Purchasing
b) Open encumbrance balance with transaction details report.
3. Define the Mass Cancel criteria in oracle purchase to select the encumbrance you
want to cancel.
4. Run Mass Cancel in oracle purchasing to cancel selected outstanding purchase order
and requisition encumbrance.
5. Post all encumbrance, budget, and actual journal entries.
6. Request the encumbrance Trial balance report in general ledger to review in details
encumbrance balance and activity for the general ledger
accounts before year -end
carry forward.
7. Close the last period of the current fiscal year,
8. Open the first period of the fiscal year.
9. Open the next encumbrance year
10. Open the next budget year.
11. Carry forward year -end encumbrance.
12. Request the encumbrance Trial balance Report.
50. How can you inquire Account Balance?
Navigation path
Inquiry / account
By giving the date, account number, we can see the account balance for period.
51. What is step-down Auto Allocation?
You must create journal batches in a specific sequence when using step -down auto
allocation. Order your journal batches so that the posted result of one step are used in the
next step of the Auto Allocation set.
52)
What are Statistical Accounts?
Defining Statistical Accounts

General Ledger lets you maintain statistical as well as monetary balances for any account.
However, in some cases you may want to set up separate accounts specifically for
statistical information. For example, you might want to enter the units sold statistic in
your Sales Revenue and Sales Expense accounts, but enter the square feet statistic in only
a single account, say the SQFT account.
53.What are GL Tax Assignments? What is the level of tax calculation?
You can assign Input tax - AP and Output tax - AR, for general ledger journal entry
31

Level of tax calculation
1) Set of books level
2) Account level
54.What is Mass Maintenance? What are the business Rules for Mass Maintenance?
Use Mass maintenance to move balance by period from one account to another or merger
balance by period from multiple accounts into a single account... The moved / merged
balances are added to the existing balance in your target accounts.
Achieve and purge account balance, as well as journal batches, entries, lines, and
associated journal reference for one or more accounting periods, provided the periods are
permanently closed.
You can achieve and purge actual, budget, or encumbrance balances. In addition, for
translated actual and budget balances
55.What is Multi-currency accounting? What are the setup steps?
One set of books will have functional currency, when we want Multi-currency
accounting; we have set foreign currency in another set of books. Same company will
have two set of books, one for functional currency, and another foreign currency.
Setup step
1) Create a set of books with chart of account, calendar, and currency. (Currency other
than functional currency)
2) Go to the Multiple Reporting currencies tap, enable as Reporting set of books
3) Assign the reporting set of books to primary set of books; define conversion type, rate,
and application.
58. What are EMU currencies?
European Monetary Union currency
59. GCS and GIS setup steps
Consolidation Process
To consolidate your financial results in an orderly manner, the table below lists our
recommended consolidation steps. For detailed information on consolidating multiple
Oracle Applications and Non-Oracle Applications instances, carefully review the Global
Consolidation System.
Consolidation Step
Define a Consolidation Chart of

Accounts:
Description
Each subsidiary will require their own set of books or

their own applications instance to meet their operational
32

Define and maintain flexible charts
of accounts to accommodate your
unique business needs.
or local accounting needs. You must define a standard

consolidation chart of accounts for the consolidated
parent set of books.
Map Data:
Define how your subsidiaries
accounts map to the parent set of
books.
Mapping determines how your subsidiary balances roll up

into the consolidated parent ledger.
Gather Data:
Collect data from disparate systems
into the GCS application.
If using multiple database instances:

Oracle Applications - Use Cross Instance Data Transfer.
See: Gathering Subsidiary Data from Multiple Instances
Using Oracle Applications.
Non-Oracle Applications - Use SQL Loader or the
customizable spreadsheet front-end to load data from
diverse sources into the GCS open interface. See
Gathering Subsidiary Data from Multiple Instances Using
Non-Oracle Applications.
Prepare Subsidiary Data:

Prepare your subsidiary balances
before you transfer them to the
parent.
Revalue and translate foreign subsidiaries account

balances to update functional currency equivalents before
you transfer balances to the parent.
Note: If you use Multiple Reporting Currencies, you may
be able to bypass the translation step by consolidating
directly from a subsidiary reporting set of books to your
consolidated parent set of books. See: Preparing
Subsidiary Data.
Transfer Data:
Transfer subsidiary financial
information to the consolidated
parent set of books.
Simplify transfer balances or transactions from your

subsidiaries to the consolidated parent set of books.
Post Consolidated Data:

Each consolidation journal submitted by each of the
Post the consolidation journals in the
subsidiaries needs to be posted to the parent set of books
parent set of books to update
to update its balances.
consolidated balances.
Eliminate Balances:
Use automatic intercom any eliminations to generate
Eliminate intercom any balances and
elimination sets. For formula-based eliminations, you can
minority interests related to internal
also use recurring journals.
transactions.
Report:
Deliver consolidated financial
information throughout the
enterprise.
Use the Financial Statement Generator (FSG) to create a

consolidated report from the parent set of books, or create
separate reports in each of the subsidiary sets of books.
You can also use Applications Desktop Integrator (ADI)
to extend reporting to a spreadsheet environment. Use
33

ADI to create printed reports or create your reports in
HTML to publish to the web or your corporate intranet.
Analyze:
Review and analyze your
consolidated reports to assess the
effectiveness of your companys
global strategies.
Use GCS to drill from consolidated balances in the parent

set of books directly to the subsidiary set of books within
the same instance. You can also drill between a
subsidiarys translated balances to its original balance.
GCS provides you with the flexibility to drill between
summary accounts, detail accounts, and the original
journal entries.
Directly link your data to Oracle Financial Analyzer, an
online analytical processing application, to analyze
consolidated balances and prepare operational and
financial analyses for your management team.
GIS
Prerequisites
. Define your GIS subsidiaries.
. Define a responsibility for each of your GIS subsidiaries and have your system
administrator set the transaction security for each responsibility.
. Define transaction types.
. Define your subsidiaries intercom any clearing accounts.
60. What is FSG? What are the components of FSG?

Financial Statement Generator
A powerful and flexible tool that can be used to build customized reports without
programming. Reports can be defined online with complete control over the rows,
columns and contents of the report.
Components of FSG
1. Row set
2. Column set
3. Row order
4. Content set
61. What is the security provision in FSG?
Using system administrator responsibility, we can define security rules to control what
financial information specific users can print when they run FSG reports.
To enable FSG security:
1. Define security rules for specific account segment values.
34

2. Assign security rules to specific responsibilities.
3. Set the profile option FSG: Enforce Segment Value Security to Yes.
62. What is the reporting set of books?
Reporting set of books is a set of books which is having same Chart of accounts and
calendar as that of primary set of books but having different currency other than
functional currency for the purpose of reporting financial results
63. What is the difference between revaluation and translation?
Translation is a process that allows restating functional currency account balances
into a reporting currency using average, periodic, or historical rate.
Whereas revaluation is a process that allows revaluing assets and liabilities
denominated in a foreign currency using a period-end (usually a balance sheet date)
exchange rate and any gain or loss is accounted.
64. Set up steps for Revaluation?
Define an unrealized gain/loss account.
Define a revaluation rate for each currency for each period for which we want to run
revaluation.
Enter account ranges for which we want to run revaluation
65. Set up steps for Translation?
Define a period in the calendar that proceeds the first period we want to translate.
Define a period in the calendar following the period we want to translate.
Enter period and historical rates for the targeted currency.
Review the setting of the profile option GL: Owners Equity translated as PTD
66. What is Cumulative Translation Adjustment account?
Cumulative Translation Adjustment account is to account the net difference needed to
balance the translated chart of account while doing the translation
67. What do you mean by Populist, List of Value and Long List of Value?
Poplist
Choose the populist if values are less than 10
List of values
List of values is used when values are between 10 to 200
Long List of Value
The Long List feature requires a user to enter a partial segment value before the list of
values retrieves all available values
It contains more than 200 values
68. In Value set, how will you restrict wrong entry of values and also ensure security
rules?
Using format validation we can specify the format type, Maximum size, Maximum &
Minimum value, Precision and so on to restrict the wrong entry of values
35

By enabling security type as Hierarchical security or Non-Hierarchical security we can
create security rule to ensure security
69. What are summary Templates? How will you create it?
Summary templates to create summary accounts, whose balances are the sums of
multiple detail accounts. It is used to perform online summary inquiries, as well as to
speed the
Processing of financial reports, Misallocations, and recurring journal formulas.
Creating a new summary account template:
1. Navigate to the Summary Accounts window.
2. Enter a Name for the summary account template.
3. Enter the Template.
4. Enter the Earliest Period for which you want General Ledger to maintain your actual,
encumbrance and budget summary account balances. General Ledger maintains summary
account balances for this accounting period and for subsequent periods.
5. If you are using budgetary control for your set of books, set the budgetary control
options for the summary template.
70. What is Year -end closing steps? How will you get Opening balances for a new
year?
1) Run Post all Journals
2) Run Close process - Create Income statement closing Journals
3) Run Close process - Create Balance Sheet closing Journals
4) Close the period - Nag to Setup - Open/close, Select the period as close
36

O2C Journal Entries
1 When Ship Confirmation is done
Deferred Cost of Goods A/c Dr
To Inventory Account
2 When Auto Invoice Standard Program is run
Receivables / Customer A/c Dr
To Revenue Account
3 When Payment is received and confirmed
Receipt Confirmation A/c Dr
To Receivables/Customer A/c
4 When Payment is remitted to bank
Remittance A/c Dr
To Receipt Confirmation A/c
5 When the Payment clears
Cash A/c Dr
To Remittance A/c
P2P Journal Entries
1 When Material Recd
Receiving Inventory A/c Dr
To Inventory AP Accrual A/c
2 When Material moved to Sub-Inventory
Material A/c Dr
To Receiving Inventory A/c
3 When the Invoice is created
Inventory AP Accrual A/c (Item Exp) Dr
To Supplier Account
4 When the Amount is paid
Supplier Account Dr
To Cash Clearing Account
5 When the payment is cleared
37

Cash Clearing Account Dr
To Cash Account
BP 040
BP 080
RD 020
MD 050
CRP-1
CRP-2
BR 100
BR 110
TE-40
Current Business Process (As Is)

Solution Document (To Be)
Requirement Gathering - Questionaire
Requirement / Scratch Report /Addl Field
Standard Functionalities Presentation
Open Issues of CRP1, Customisation, Form
Personalisation, Any new requiremetns
Configuration Doc - Based on CRP 2
Security Matrix / Roles and
Responsibilities
Test Cases
MANDATORY SETUPS FOR PAYABLES
1. Define Financial Options.

2. Define Payment terms.
3. Define Payment Methods.
4. Define Payment Format
5. Define Pay Group.
6. Define Supplier.
7. Define Banks.
8. Define Distribution Sets (Optional).
Mandatory setups: A R
1. Defining party tax profile and e-business tax setups
2. Defining system options
3. Payment terms
4. Statement cycle
5. Collector
6. Auto cash rule set
7. Customer
8. Define frieght & carrier
9. Item valid org
10. Receivables activities
11. Auto accounting
38

MONTH END PROCESS
Month End reconciliation between GL and AP is highly recommended. If AP is interfaced to GL, verifying the
balance between the two applications is usually done through comparing account balances of the liability
(A/P) account.
To reconcile your accounts payable activity for April, make the following calculation:
"Accounts Payable Trial Balance" as of March 31 +
"Posted Invoice Register" for the period between April 1 and April 30 "Posted Payment Register" for the period between April 1 and April 30 =
"Accounts Payable Trial Balance" as of April 30
> If total is not matching you will need to find out the root casue of difference:
Eg. Invalidated Invoice for the period
> For the PTD activity check the "period Close Exception" if there are any invoices and payments which are
not transferred to GL.
> If the current period does not reconcile, please complete the reconciliation process for all prior periods
from the most recent to the earliest until you get to one that reconciles.
Common Reasons for balance mismatch between AP & GL
1) Manual journal entries in the general ledger that involve an AP liability account will cause the AP Trial
balance not to reconcile to the GL. These entries are not included in the AP sub ledger so they will not be
reflected on the AP Trial Balance Report.
Run the "GL Account Analysis" report for the liability account and for the date range in question. Look for
transactions with a source other than Payables. This can quickly pinpoint any transactions incorrectly
charged to the account.
2) You performed a data fix in the past where you used the undo accounting script and swept a
transaction forward from a closed period to re-account it, this will cause an imbalance between AP
and GL. The imbalance will be corrected in the period in which you made a GL adjustment to
account for the fix.
3) Any correction you make during the journal import process will result in the line being changed in the
general ledger, but not in AP
4) If you have deleted any AP batches or lines from AP batches out of the GL Interface, this will cause AP
and GL to be out of balance
5) If the AP batch is still in the GL Interface, it will not be reflected in the GL reports and this will cause a
difference between AP and GL.
6) Any AP batches that are un posted in GL will cause a difference between AP and GL.
39
REPORTS WHILE CLOSING AP AND RECONCILE WITH GL
These are the reports we can generate while closing the AP and Reconcile with GL
1. Complete all the transaction in AP module (Standard Invoices, Prepayment Invoices,
Payments etc)
2. Run the *Invoice Validation* program for validating all the unvalidated invoices, if any.
3. Run and Review the *Invoice Hold Report* - Lists all invoices which are under hold, that
would prevent the payment/posting of the invoices
4. Run the *Create Accounting Process in the Final mode* - Report level should be
detailed
5. Clear/Reconcile all the payments in Cash Management and rerun the payable Create
accounting process
6. Run the *Transfer Journal Entries to GL* - program by selecting the ledger and the End
Date.
7. Post the journal in GL
8. Submit the Unaccounted Transactions Sweep Program. No need to run this program,
if you can close the period. This report will not sweep accounted transactions and
transactions with error to the next period
9. Navigate to Accounting > Control Payable Periods and select the first open period and
change the status to Closed. If any pending transactions exist for the specific period
(Validation, Create Accounting Process etc),
system will prompt that Exceptions exit, you cannot close the period.
10. Click on the Exception Button and click on Review. System will trigger a report "Period
Close Exceptions Report". Review the report and take action. Take action based on the
exception report
40
Run the Accounts Payable Trial Balance Report - This report will list only those
invoices/payments which has already been transferred to GL (posted and un posted) This
report is used to facilitate reconciliation of the total accounts payable liabilities in Oracle
Payables, with the Oracle General Ledger Creditors Control Account, for a specific
accounting period. These invoices represent the outstanding accounts payable liability for
the organization.
To obtain the most up-to-date trial balance for a given period, journal entries should be
posted for the invoice and payment activity for the period, prior to running the report.
To the previous periods Accounts Payables Trial Balance, add the current period's
posted invoices (total amount from the Posted Invoices Register) and subtract the
current period's posted payments (total cash plus discounts taken, from the Posted
Payments Register) . The calculated amount should equal the balance for the current
period's Accounts Payables Trial Balance.
Oracle Receivables R12: AR to GL Reconciliation

Navigation Control > Accounting > AR to GL
Reconciliation Report
41
AR to GL Reconciliation Report
The AR to GL Reconciliation report compares the account
balances in Oracle Receivables to those in Oracle General
Ledger, and highlights journal sources where discrepancies
might exist. This report simplifies the reconciliation process by
comparing Receivables and General Ledger account balances in
a single place.
Run the AR to GL Reconciliation report:
1.
After the Submit Accounting program in Receivables has

completed, and
2.
You have reviewed the Unposted Items report to confirm

that all journal entries have posted, and
42
3.
You have used the posting execution reports to confirm

that the journal entries exported from Receivables match those
posted in General Ledger.
The AR to GL Reconciliation report prints by ledger and
organizes data first by company segment, then account type
(assets, liabilities, income, and expense).
This report will show a difference between Receivables and GL
account balances only if items did not successfully post to GL
accounts. The Difference column indicates that the activity in
Receivables compares to the journal source of Receivables in
the general ledger. If the actual balance of a specific account is
different in Receivables than in the general ledger, then the
following columns highlight the type of journals that affect the
account balances:
GL Source Manual: Manual journal entries made in the

general ledger.
GL Subledgers Not AR: Journal entries posted to the

general ledger from other subledgers, such as Oracle Payables
or a legacy feeder system.
Unposted in GL: Unposted journals in the general ledger.

If manual journal entries exist in the general ledger, then you
might need to reverse these journal entries if corrections were
already made in Receivables.
If other sub ledgers post to these accounts, then you might need
to make corrections in those sub ledgers, make manual
43
corrections in the general ledger, or reconcile your other feeder

systems separately.
After taking the required corrective actions, run the AR to GL
Reconciliation report again to confirm that AR and GL accounts
are now in balance.
MOAC is a new feature in Oracle R-12.MOAC is a feature which facilitates the user
to access Multiple Operating Units from a single responsibility with in a Business
group or across the Business Groups.
In order to Setup MOAC SECURITY PROFILES are to be defined in HRMS
Responsibility.There are two types of Profiles.They are : (1) LOCAL PROFILE
(2) GLOBAL PROFILE
LOCAL PROFILE-With this security profile the USER can access to Multiple
Operating Units with in the BUSINESS GROUPS.
GLOBAL PROFILE-With this profile the User Can access to multiple Operating Units
from different Business Groups.
Navigation:HRMS-SECURITY-PROFILE(FOR LOCAL PROFILE)

HRMS-SECURITY-GLOBAL(FOR GLOBAL PROFILE)
After defining the SECURITY PROFILES submit a concurrent request named
SECURITY LIST MAINTENANCE PROGRAM in HRMS Responsibility.
Switch to SYSTEM ADMINISTRATOR and set Profile options for all the
responsibilities which are performed at Operating Unit level... i.e Order
Management,Receivables,Purchasing and Payables etc..
Navigation:SYSTEM ADMINISTRATOR-PROFILE_SYSTEM
select responsibility and in Value mention MO%SEC%
set LOCAL or GLOBAL SECURITY PROFILE depending on the requirement
44
What is the purpose of receiving transactions?
In order to receive item into inventory we perform receiving

transactions. The purpose behind the receiving transaction is there is
not be any mismatch between item ordered and item recieved.
why we use segment and flex field qualifier what is the difference between flexfield and segment
qualifiers
Flex field qualifier:
flex field qualifier will identify the nature of the segment.
Segment qualifier:
segment qualifier will identify the type of the account.
What is an accounting calendar and a Transaction calendar ?
Accounting calendar is used for recording the trasactions

for the financial year and it will share across the
application.
Transaction calendar is used for average balancing .It will
stop the trasactions on non working days.it can be used for
defining the org calender in banking sectors.
What are the steps to define a Bank?
there are 3 types of bank account

1.internal
2.customer
3.supplier
if ur defining internal and customer bank accounts u need
to define payament format.
steps
----setup>payment>format
1.payment format describes in which method u want to make
payment to the supplier
2.how many invoices are to printed in a cheque.
3.how the cheque has to be printed
after defing this save ur work.
step 2
-----setup>payment>bank
45
1. enter ur bank name & branch name.

2. click on bank accounts
3. select internal
4. give gl accounts cash & cash clearning
5. click on payables doucument
6. define name of doc & attach ur payment format which we
defined in step one.
7. give the numbering from where to start.
this are the mandatory setup's.
How to see the structure of organization?ie which LE
connected to which ledger and which OU connected to which LE?
In Release 12, try to get the information with the below

Navigation.
1. Login to GL Super User Responsibility
(N)Setup --> Financials ---> Accounting Setup Manager --->
Accounting Setup
2. Query with the Ledger Name
3. Click on Update Accounting Option
3. Check the Legal Entity Name
4. Click on Operating Unit Update option under "Primary
Ledger Region" below the "Legal Entity" Region.
5. Click on Update on Operating Units under "Setup Step"
6. You will find Business Group, Legal Entity, Operating
Unit
what are mandatory setups for Receipt creation.?
Receipt source and receipt class are the mandatory

What is the use of SLA ?
In Oracle financials SLA means sub ledger accounting method

it is the central storage of accounting information of all subledger transactions.
What type of issues You face in SLA
Sla is a new feature in R12 ( in 11i called Account Generator Workflow )
It is a rule based account derivation system . Based on the Legal entity we can over
ride the sla Accounts.
and it is a group of hierarchical structure.
46
in sla group is consists of Sources and Events.

Sources : Sources are coming from transaction
Events : Events like Billing events, Invoice events, Debit memo event ,
Payment event.
In SLA actually delete actual debit other wise its creates 2 debits and
1 credit.
what is the profile options
profile option values control the oracle apps. in other wards they determine how the
oracle apps should run. the value of profile option can change at any time.
two types.
1)system profile options
2)user profile options.
profile options can define in following ways .
1)site
2)application
3)responsibility
4)userThe profile option can be set at below 4 levels
User has the highest precedence over responsibility, application and site.
What is Payment Process Profile? and What is use of Payment process profile
payment process profile says, how you are going to process your payment, whether
through check or electronic.
Account receivable (ar)
Transactions-transactions : Bill to ( customer not displayed). Value entered is not valid
current field. Please re enter ? Customer is already created.
The Possible Reason is Business Purpose 'Bill-To' not enabled for this customer
site.
Assumption: Customer is already having Site.
what is unearned revenue and accounting entries of it.
Unearned revenue generally occur in Billing in advance scenario where Billing is

done and revenue is not yet accrued. The accounting entry for this transaction would
be Dr Receivables A/c and Cr Unearned Revenue. Later on once the revenue is
accrued the entry would be Dr Unearned Revenue and Cr Revenue a/c.
47

Unearned Revenue is like an advance payment.
what is factor to be consider for finalisation of chart of account
Following are some of the factors which can be considered. 1. Current Chart of
Accounts structure of the Organization (legacy). 2.Reporting requirement (For ex:
Product based profitability or reporting) 3. Inter-company Accounting 4. Legal
Requirements 5.Type of Industry for example some project based organizations use
a segment to get project based accounting.
Depending on your organization structure and reporting requirements it would
change. You can create up to 30 segments. Most organization use between 5-10
segments. But one factor you need to consider before finalizing chart of accounts is
future changes to the structure is difficult and not recommended.
what is receipt source and receipt class
Receipt source and receipt class are using in Oracle Receivables.
Receipt souce: setting numbers for the receipts.
Receipt Class : Here we hav to maintain like payment methods, accounting
information and remittance and customer payments informaton.
48

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Frequently Asked Questions in Oracle Financials

Frequently Asked Questions in Oracle Financials

Frequently Asked Questions in Oracle Financials

Frequently Asked Questions in Oracle Financials

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Build Payment Programs

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35. What are the Offset Taxes? Where it is used?

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3Way. Control checks 1 and 2, plus:

4Way. Control checks 1, 2, and 3, plus:

Temporary prepayments can be applied to invoices or expense reports you receive.

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3. What is Auto invoice? What are its related setup steps?

Interfaces: Auto Invoices

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5. What is an Application Rule set?

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Prorate All: Apply a proportionate amount to the line, tax, freight,

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(ii) VAT Tax

13. What is an Auto cash Rules?

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23. What are Dunning Letters?

26. What is taxable Basis available for a Tax Code?

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37. What are methods of creating batch receipts?

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1. What is a Flex Field? What are Key and Descriptive Flexfields?

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8. What do you mean by Dynamic Inserts?

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33. Multiple Reporting Currencies

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: ------------------------------do------------then all transactions are approved.

45) Budgetary control group

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How to view funds available for Budget Transactions?

1. Navigate to the funds available Inquiry window

49. What is year end Encumbrance Processing? How is it performed?

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What are Statistical Accounts?

Defining Statistical Accounts

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Define a Consolidation Chart of

Each subsidiary will require their own set of books or

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or local accounting needs. You must define a standard

Mapping determines how your subsidiary balances roll up