Oracle Fin Month End Close

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ORANGE LAKEOracle Applications ImplementationMONTH END CLOSE PROCEDURESOracle Release 11iAuthor: Creation Date: Last Updated: Version:Michelle Lane and Alex Leatherwood Jan 2006 Jan 2006 DRAFT 1AApprovals:Copy Number_____ContentsIntroduction.................................................................................................................................4 General Preparation for Period Close.........................................................................

Transcript

ORANGE LAKEOracle Applications ImplementationMONTH END CLOSE PROCEDURES

Oracle Release 11i

Author: Creation Date: Last Updated: Version:

Michelle Lane and Alex Leatherwood Jan 2006 Jan 2006 DRAFT 1A

Approvals:

Copy Number

_____

Contents

Introduction.................................................................................................................................4 General Preparation for Period Close........................................................................................5 Administrative Procedures for Period Close..............................................................................6 Accounting Procedures Prior to Closing Oracle Applications ..............................................7 The Close Schedule....................................................................................................................8 Chapter 1: Oracle Projects Period Check List Detailed Instructions..................................10 Procedures..........................................................................................................................10 Chapter 2: Oracle Purchasing Period Check List Detailed Instructions.............................18 Business Requirements......................................................................................................18 Closing...............................................................................................................................18 Chapter 3: Oracle Payables Period Check List Detailed Instructions.................................23 Business Requirements......................................................................................................23 Closing Process..................................................................................................................23 Chapter 4: Oracle Assets Period Check List Detailed Instructions.....................................28 Business Requirements......................................................................................................28 Procedures..........................................................................................................................28 Chapter 5: Oracle Receivables Period Check List Detailed Instructions...........................33 Business Requirements......................................................................................................33 Why dont my AR and GL numbers match?....................................................................33 Closing Process..................................................................................................................33 Chapter 6: Oracle Cash Management Period Check List Detailed Instructions.................44 Business Requirements......................................................................................................44 Procedures..........................................................................................................................44 Chapter 7: Reconciling Accounts Receivable Cash to GL....................................................48 Chapter 8: Reconciling Accounts Payables Cash to GL........................................................50 Chapter 9: Oracle General Ledger Period Check List Detailed Instructions......................51 Closing Process..................................................................................................................51 Chapter 10: Year End Closing.................................................................................................54 Chapter 11: How to export from Oracle to Excel ?.................................................................56 Chapter 12: How to transfer files from and to Oracle Financials...........................................58

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Introduction

iii

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IntroductionThis document provides detail instructions for period-end close. It is a living document, subject to revision as subsequent closing experiences provide greater insight into the peculiarities of operations remaining inestimable at present. From a systems viewpoint, at closing time some performance issues need particular attention. The close process heavily depends on processes and reports running in parallel with daily operations, and this sharing of processor time creates delays in the generation of key information. Ideally the accounting processes take place when there are no other demands on the system by scheduling jobs to run overnight. It is necessary to allocate the highest system availability at month end close to allow for an efficient and timely close.

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General Preparation for Period CloseSome general procedures for period close preparation are listed below. The accounting manager will assume oversight responsibility for compliance, but the primary responsibility rests with supervisors and managers of the various areas. Key reporting requirements may be changed by the controller as the need arises.

Process all standard transaction types in Subledger Process all exception types in Subledger Identify key reporting requirements Identify data to be reconciled Define distribution list for close results and reports Log all exceptions, adjustments to comply with audit requirements

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Administrative Procedures for Period CloseClose all application subledgers before closing the general ledger. This includes all manufacturing and financial modules. The order in which these subledgers should be closed is listed in the table below.Close Order 1 2 Application Oracle Projects Oracle Purchasing Comments Has direct effect on Oracle General Ledger. Accounts Payables and Assets Oracle Purchasing passes receiving transactions to Oracle General Ledger. Oracle Purchasing also can create a liability for uninvoiced receipts. Has direct effect on Oracle General Ledger and Assets Creates depreciation, addition, retirement and transfer entries For rent, chargebacks for tenant supplies, and child care revenue. No dependencies on other subledgers. Leaving this open late in the cycle allows as much revenue as possible to be booked in the current month. Check Reconciliation and Misc Journals For example, payroll, timeshare ware, etc. This is closed last.

3 4 5

Oracle Payables Oracle Assets Oracle Receivables

6 7 8

Cash Management Non-Oracle interfaces Oracle General Ledger

It is possible to change this order somewhat as long as special known provisions are satisfied, between Oracle Projects, Oracle Payables, Oracle Assets and Oracle Purchasing. There are numerous Oracle Applications references to the close process in the respective applications reference manuals that can provide guidance on the close process; these should be consulted as needed by Orange Lake managers for further clarification.

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Accounting Procedures Prior to Closing Oracle ApplicationsThe general steps accounting department employees should take are listed below: 1. Complete all transactions in progress. 2. Do not let users enter additional transactions beyond cutoff dates. 3. Run all integration reports. 4. Balance transactions: Debits and Credits. 5. Perform any exceptions and reconciliation activities. 6. Complete posting from Subledgers to the General Ledger.

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The Close ScheduleThis gives a few hints & tips for period close procedures in PA, PO, FA, GL, AP and AR.

Please, read very carefully this as it contains some very important hints and tips which will help you perform your closing more easily.Whenever possible, take advantage of overnight processing to avoid running into processing bottlenecks, since all modules and all countries are closing at about the same time.

1.

2. 3. 4. 5. 6.

For your first closing : Before closing the first go-live period, it is advised to close the period just before golive period. Example : if go-live month is September, before closing September, close August. This allows : to detect some journals or transactions which have been entered in August, by mistake, and which should really be in September instead. to do your first closing on an easy period, since it contains very few entries (only mistakes actually), in addition to data conversion entries. Establish clear cut deadlines for when data will and will not be accepted for inclusion in the period. After that point, everything goes into the next period. Notify all users when the system is not available during the closing to prevent new transactions from being entered on the period in the process of being closed. Notify users when the system is available again. If you find inappropriate usage of accounts, you may need to modify some of your setups and/or retrain some of your users so this does not happen again. For all modules I recommend that you have only one open period at a time. You could have activity going into one period when you meant for it to go into another period. This is due to the General Ledger date defaulting to the current date and if that date is within an open period it will use that date. Also, there are known problems with items being posted with one side of the entry in one period and the other side in the next period. I find it to be just too risky to have more than one period open. If you minimize the time it takes to close, this should not be an issue. Tip for AR : Set up your Unapplied Cash, Unidentified Cash, On-Account Cash and Accounts Receivables accounts once and for all and do not change them. Processes in Oracle Receivable, such as applying receipts and creating adjustments, do not allow you to access these values which means you cannot override them. In these processes, Oracle Receivables derives the accounts based on the accounts that were used when the remittance bank was originally created, no matter how long ago that was. If these accounts are stable, reconciliation is fairly straight forward. If they are not stable, reconciling can be much more cumbersome and you may see these old accounts for what seems like forever. Tip for AR : Your Unapplied, On-Account, and Unidentified accounts should use a specific account, not your cash or Accounts Receivable accounts. Often the Unapplied, On-Account and Unidentified accounts are all the same account, which is fine. Tip for AP : Do not enter prepayment by debiting the prepayment account in the distribution lines of the invoice. Those lines will not be regarding as liability and will not be taken into account in the balance of your supplier.

7.

8. 9.

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Suggestion: You can use the Export function to Excel (see 9).

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Chapter 1: Oracle Projects Period Check List Detailed InstructionsPeriod end procedures for Oracle Projects has two main functions: 1. Changing the status of the current period to closed 2. To activate all the processes and controls necessary to produce reports that accurately reflect the period activity, while allowing minimum interruption of transaction processing. Project Periods and General Ledger Periods In Oracle subledgers, such as Projects, transactions are summarized into periodic cycles for reporting and reconciliation. Most subledgers have a periodic cycle that parallels the General ledger fiscal cycle. However, projects may be based on a different periodic cycle to that of the General ledger. Project periods may be based on a different period of time such as a week. If the two sets of periods overlap, then you may need to put in place special procedures for the reconciliation of Projects to the General ledger, and other modules. Suggestion: If you have different periods in Projects, you may like to consider using one of the alternate General ledger period conventions, such as a 5-4-4 period split. This will enable you to more easily align Projects with General ledger for reconciliation purposes. Another option is to split PA periods that would otherwise overlap your General ledger periods. If this is done you will need processes in place to ensure that transactions split over such periods are processed into the correct PA partial period

Period Statuses Oracle Projects has available the standard period statuses as for other modules: Never Opened Future Enterable - the period has never been used. - the period is open to accept transactions from other modules. Usually used where modules are maintained in different periods, and transactions are likely to be posted across modules. - Period is available for data entry - Period is closed for processing, but can be re-opened if required.

Open Closed

Permanently Closed - No further processing is possible. Pending Close - This status prevents transaction entry, and allows users to correct unprocessed items prior to completing the period close.

Procedures1. Change the Current Oracle Projects Period Status from Open to Pending Close This is an interim status, which allows you to interface transactions in the period but does not allow transaction entry.File Ref: 43234607.doc (v. DRAFT 1A ) 10

This process needs to be actioned for each Operating Unit defined.

2. Open the Next Oracle Projects Period It is recommended that you open the next period to minimize interruption to users, who may require the ability to enter transactions in the new period during the current period close procedure. This process needs to be actioned for each Operating Unit defined.

3. Complete all Maintenance Activities As there are a number of maintenance activities that can affect the period close procedure, you should ensure that all the following maintenance activities have been completed: Project Maintenance - Burden Schedules and burden schedule overrides - Organization overrides - Project Classifications (if used for auto-accounting) Project Maintenance (revenue/billing based options) - Billing burden schedules and burden schedule overrides - Bill rate schedules and bill rate overrides - Project labor multiplier changes - Revenue budget changes - Project/Task % complete - Funding changes - Changes in the task Ready to Accrue checkbox Implementation Maintenance - Employee assignments - Labor cost rates - Standard costing burden schedule maintenance Other Maintenance - Retroactive changes in employee assignments - Retroactive changes in labor cost rates - Changes in AutoAccounting Rules or Lookup Sets Suggestion: You may need to implement workflow procedures, or use function and responsibility restrictions to prevent access to these areas during the period close procedure.

4. Run Maintenance Processes It is recommend that the following maintenance processes be run in preparation for th...

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