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Encumbrance : Transactional Data Flow from PO to GL

Here is basic data flow from the subledger (PO) to the Subledger Accounting module (SLA) to General Ledger (GL) in Context to R12.

Upon reserving and approving PO:

  1. On reserving and approving the PO, encumbrance entries get generated in GL_BC_PACKETS with source_distribution_type as po_distributions_all and SOURCE_DISTRIBUTION_ID_NUM_1 as po_distribution_id.
  2. Encumbrance entries will also get generated in the table PO_BC_DISTRIBUTIONS which was introduced in R12. This table has the "reference4" and "reference3" columns where the PO/Req number and distribution id gets populated.
  3. It is recommended that you use the table PO_BC_DISTRIBUTIONS instead of GL_BC_PACKETS to view the encumbrance entries.
  4. Accounting entries created on reserving the PO can be viewed in the SLA menu in Purchasing.
    • Navigation: Purchasing > Accounting > SLA: User Main Menu > Journal Entries > query by transactions dates and ledger name
  5. The following accounting entries will be available for viewing:
    DR - Budget Account
    CR - Reserve for Encumbrance Account
  6. These accounting entries are populated in the XLA_AE_LINES. The event type code in XLA_AE_HEADERS for this Encumbrance entry is "PO_PA_RESERVED".
    • The table PO_BC_DISTRIBUTIONS and XLA_AE_HEADERS are linked with the column "event_id".
    • The table XLA_AE_HEADERS and GL_BC_PACKETS are linked with the column "ae_header_id".
    • The table XLA_AE_HEADERS and XLA_AE_LINES are linked with the column "ae_header_id".

The Concurrent Request Transfer Journal Entries to GL has to be submitted from Purchasing to transfer the encumbrance entries to GL.

Upon Receipt of goods or services:

  1. "On Receipt" and "Period-End" types of receipt accruals (for inventory or expense receipts) are processed through the GL_INTERFACE table. When a PO has Accrue on Receipt set to "Y", the Receiving Transaction Processor generates the accounting entries in RCV_RECEIVING_SUB_LEDGER upon "Receipt and Deliver" of the PO.
  2. Then the Create Accounting-Receiving concurrent program has to be submitted from Purchasing to create SLA journals which will insert records in XLA_AE_HEADERS and XLA_AE_LINES.
  3. The Create Accounting-Receiving program will spawn another program called Create Accounting which will generate the entries in GL_INTERFACE.
    • There is an option to make the journal entry and post the journals automatically at the time of submitting the Create Accounting program itself. This option is used by setting the profile option SLA: Disable Journal Import to "NO". This setting is preferred because it indicates that Journal Import will ALWAYS accompany the transfer of data from the subledger.
    • Another main implication of this value is that on failure of Journal Import, the data will be rolled back to SLA tables and hence, there will not be any data in GL_INTERFACE.
  4. Once the accounting is created for Receiving transactions in the Receiving subledger, the encumbrance reversal entry can be viewed in SLA menu in the Purchasing module, as well as in SLA menu in Costing.
    1. The following accounting entries will be available for viewing:
      DR - Reserve for Encumbrance Account
      CR - Budget Account
    2. These accounting entries will be available in the table XLA_AE_LINES. The event type code in XLA_AE_HEADERS for this encumbrance reversal entry is "DELIVER_EXPENSE" for Expense destination receipts and "PO_DEL_INV" for inventory destination receipts.

Take a note, In R12, Subledger Accounting (SLA) options have been introduced and accounting entries can be viewed at the SLA menu. As a part of Subledger Accounting, new SLA tables XLA_AE_HEADERS and XLA_JE_LINES have been introduced. Receiving Subledger is no longer directly linked to GL_JE_LINES. Instead, it is linked through the subledger tables XLA_AE_HEADERS and XLA_AE_LINES.

Reconciliation and Troubleshooting