As mention earlier, SLA played a key role in most of accounting event based application.Some of high points of SLA and Fixed asset are:

• Oracle Assets is fully integrated with SLA, which is a common accounting platform for Sub Ledgers
  • There is no need to explaining again , we already seen why this concept brought into Financial application . Fixed asset though one of Application, which heavily utilize the accounting information ,therefore its is obvious Choice.
• You can use the seeded Account Derivation definitions or modify them as required
  • ADD as discussed in earlier post , can be used for as it is or we can manage and configure the definition to accommodate own custom derivation rule.
• SLA does supports Account Generator functionality for existing Asset Books
  • For those who are coming from 11i background knows Oracle FA Module uses the Account Generator to generate accounting flexfield combinations for which to create journal entries into GL. The Account Generator normally allows to designate a specific source for each segment in the account for which Oracle Assets creates a journal entry. These flexibility options can be archived by anyone ..
    • Flexibility to create journal entries that mean you can specify to what detail to create journal entries
    • Flexibility of managing detail level for each book and account type.

Technically speaking Account Generator in Oracle Assets is Oracle Workflow driven component which can be viewed and customized with some skill in Oracle Workflow.

In Release 12 , by default, Subledger Accounting is used to generate accounts which is defined at ADD, still you have options to use the 11i workflow based account generator. The minimum you have to do is to keep "FA: Use Workflow Account Generation" profile option is set to Yes, that mean the account generation rules set up in Oracle Workflow will be used.

• And, last ..SLA in FA can heavily used for SLA Accounting report and online account inquiry purpose.

How SLA works in Fixed asset

Subledger Accounting Process consist of these three steps

1. It start with entering transactions in the application.
2. Then running the Create Accounting Program to process accounting.
3. Once step 2 completed successfully, you can use this for inquire . You can also drilldown information from SLA Pages

Lets take yet another granular look for SLA with FA..

• Accounting Events
• Oracle Assets creates accounting events for every asset transaction

These are major four event entries Accounting Events Classes you can get in Fixed asset.

• Oracle Assets groups all the accounting events classes into the following four event entities:
  Transactions: This event entity groups the following event classes: Additions, Adjustment, Capitalization, Category Reclass, CIP Additions, CIP Adjustments, CIP Category Reclass, CIP Retirements, CIP Revaluation, CIP Transfers, CIP Unit Adjustments, Depreciation Adjustments, Retirements, Retirement Adjustments, Revaluation, Terminal Gain and Loss, Transfers, Unit Adjustments, and Unplanned Depreciation.
• Depreciation: This event entity groups the following event classes: Depreciation and Rollback Depreciation.
• Inter Asset Transactions: This event entity groups the following event classes: Source Line Transfers, CIP Source Line Transfers, and Reserve Transfers.
• Deferred Depreciation: This event entity groups the following event classes: Deferred Depreciation.

Apart from this there few additional event class exist like Retirements .

The Accounting Flow

Journal entries get created that summarize the activity for each account for each transaction type.

• There is significant mean of period ,for which you want to create journal entries and the period must be open or future entry , as discussed in last post.
• The period name used in the depreciation calendar assigned to the asset book must be the same as the period name in the general ledger calendar for the ledger you want to send the journal entries to.
• When you run the Create Accounting program, Oracle Assets sends entries directly to the GL_JE_BATCHES, GL_JE_HEADERS, and GL_JE_LINES tables.
• Oracle Assets allows you to run the Create Accounting program multiple times before closing the depreciation period.
• You can post journal entries to Oracle General Ledger for all transactions that have occurred thus far in an open depreciation period.
• If additional transactions occur during the open depreciation period, you need to rerun Depreciation, then you can rerun the Create Accounting program.

Oracle Fixed Assets creates journal entries for your depreciation expense, asset cost, and other accounts. That means application automatically creates transaction journal entries for your general ledger, if you have defined and configure set up the journal entry category for that transaction type for that book. Oracle Assets creates journal entries that summarize the activity for each account for each transaction type.

Another good things for FA is its allows you to run the Create Journal Entries program multiple times before closing the depreciation period. You can post journal entries to Oracle General Ledger for all transactions that have occurred thus far in an open depreciation period. If additional transactions occur during the open period, you need to rerun Depreciation, then you can rerun the Create Journal Entries program.

Not only it create the Journal entry but also allows you to roll back journal entries in an open depreciation period,and this should be as long as applies to those journals which havn't posted to General Ledger. After doing the necessary adjustments, you can run the Create Journal Entries program once again and post the journals to General Ledger.

You should also note , you cannot roll back individual journal entries. The reason .. when you run the Rollback Journal Entries program, all journals created thus far in the current open depreciation period will be rolled back. These journals will be reprocessed the next time you run the Create Journal Entries program.

In case of Rollback Journal Entries program failure, for example, if you have already posted some additional journals to General Ledger, you can still continue to process additional transactions. However, you will not be able to re-run journal entries for that period until you have fixed the error and run the Rollback Journal Entries program successfully.Sound good!!

Once you close the depreciation period, you can run the Create Journal Entries program only once more. When the depreciation period is closed, you cannot roll back Create Journal Entries, and therefore, cannot run the program again.Hope this makes clear.

Creating journal entries

Creation of Journal entries in Oracle Consist into two step process:

1. At the end of each accounting period, run the depreciation program for each of your books.
2. Run the Create Journal Entries program to create journal entries to your general ledger.

• Case 1 : Period is Closed
  • If the period is closed, you can run the Create Journal Entries program only once for each period in each book for which you allow posting to the general ledger.
• Case II : Period is Open
  • If the period is still open, you can run the Create Journal Entries program multiple times before closing the period.

Journal Entries :

Case 1 : When you are in 11i

The create journal entries process creates journal entries for the appropriate general ledger set of books.

Case 2 :When you are in R12

The Create Accounting process creates journal entries for the appropriate Ledger.

Asset Accounts for which Oracle Assets journal entries Created

These are asset account for which are used for JE Line creation. We will see a seperate post for accounting entry in some of the transaction events so that if you are coming from non -Oracle accounting system, you can see how its works here.

• Accumulated Depreciation
• Asset Clearing
• Asset Cost
• CIP Clearing
• CIP Cost
• Cost of Removal Gain,Loss, and Clearing
• Deferred Accumulated Depreciation
• Deferred Depreciation Expense
• Depreciation Adjustment
• Depreciation Expense
• Intercompany Payables
• Intercompany Receivables
• Net Book Value Retired Gain and Loss
• Proceeds of Sale Gain, Loss, and Clearing
• Revaluation Amortization
• Revaluation Reserve
• Revaluation Reserve Retired Gain and Loss

Will take a more granular details for JE and SLA in another post. Keep watching this space.