Oracle Fusion Financials Understanding Financials: Release
Oracle Fusion Financials Understanding Financials: Release
Financials
Understanding Financials
Release 9
Oracle® Fusion Financials Understanding Financials
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Oracle Fusion Financials
Understanding Financials
Contents
Preface i
1 Overview 1
Oracle Fusion Financials Concepts: Overview ........................................................................................................... 1
Financial Business Process Model: Overview ............................................................................................................ 2
2 Enterprise 4
Modeling Financial Applications for Your Enterprise: Examples ................................................................................. 4
7 Security 32
Role Based Security: Explained .............................................................................................................................. 32
Oracle Fusion Financials Preface
Understanding Financials
Preface
This Preface introduces information sources available to help you use Oracle Applications.
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i
Oracle Fusion Financials Chapter 1
Understanding Financials Overview
1 Overview
1. Oracle Fusion Financials, which include general ledger, receivables, payables, asset tracking, expense
management, and cash management functionality.
2. Oracle Fusion Accounting Hub, providing the integration and reporting platform to effectively drive a coexistence
strategy with your existing financial systems.
The Oracle Fusion Accounting Hub is designed to be deployed in coexistence with E-Business Suite, PeopleSoft, JD
Edwards, and other enterprise resource planning systems.
The strategic intent of Financial Applications is to provide a comprehensive integrated financial management solution from
beginning to end across the accounting cycle. This solution consists of streamlined and unified best-in-class features and
capabilities.
Oracle Fusion Applications help you to transform your business into a next generation enterprise and are based on the
following elements:
• Asset accounting and reporting within the Asset Lifecycle Management process
• Cash management functionality within both the Order Fulfillment and Procurement processes
• Financial Control and Reporting including taxation, subledger accounting, general ledger, consolidation, and
reporting functionally
• Expenses management functionality within the Compensation Management process
• Multi-GAAP compliance including approaches for simultaneous compliance with corporate and national regulators
and standards.
• Currency compliance including capabilities for accounting in denomination and accounting currencies and for
translation to functional or reporting currencies as required in compliance with the relevant principles within both
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the International Financial Reporting Standards (IFRS) and United States Generally Accepted Accounting Principles
(GAAP).
Related Topics
• Financial Business Process Models: Explained
• Level zero (L0): A specific industry organized around raising capital, executing a business model, and reporting the
resultant income to shareholders or investors. For example, Automotive, Communications, Education, Healthcare,
and Utilities, to name a few of the approximately 30 identified industries
Note
The acronyms L0, L1, L2, L3, and L4 for industry, process area, process, activity, and task are often used as
shortcut references.
All industries have an L1 business area defined for financial control and reporting, and within that, an L2 process for closing
the period. Part of that is an L3 activity, Closing the General Ledger. The specific steps in closing the general ledger are
the L4 tasks. The L4 tasks correspond to tasks and roles in Oracle Fusion Financials, while L0 to L3 provide a navigation
structure for all areas of Oracle Fusion, including tasks, support, documentation, and online help.
Oracle Fusion Applications comprises 22 business process areas, most impacting Oracle Fusion Financials. Tools used to
model these business process areas include the Oracle Business Process Analysis Suite, and the results are published in
the Oracle Business Process Publisher using standard HTML. The BPM content was prepared from competitive analysis,
research, and vision. Customer research workshops intensely reviewed the models so customers can adapt the BPMs to suit
their circumstances and business processes.
Business Process Modeling carries through to almost every aspect of Oracle Fusion Financials. Business Process Modeling:
• Structures role-based access security so that tasks and activities are assigned appropriately
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• Provides guidance for Oracle Fusion Sales and Consulting in the Oracle Unified Method and in presales solutions
and setup
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2 Enterprise
Scenario
Your company, InFusion Corporation, is a multinational conglomerate that operates in the United States (US) and the United
Kingdom (UK) and plans to implement Oracle Fusion Financial Applications.
InFusion Corporation
InFusion Corporation has more than 400 employees and revenue of $120 million. Your product line includes all the
components to build and maintain Air Quality Monitoring (AQM) systems for homes and businesses. You also provide financial
services to your customers through a separate division.
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Analysis
The upper part of the figure illustrates a holding company, InFusion Corporation, who owns or controls four subsidiary
companies. Three of the subsidiaries operate the core business, two in the US and one in the UK. The fourth subsidiary,
InFusion Financial Services, operates a financial services business.
The lower part of the figure illustrates the management structure. Management of the group is arranged according
to a reporting structure in which corporate management reports to the board of directors. The two major business
managers manage the AQM and the financial services businesses, respectively, and report to the Chief Executive Officer.
Regional business managers are managed primarily (straight line directs) by worldwide business managers, and also have
responsibilities (dotted-line) directed by the corporate regional vice presidents, who serve as general managers.
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The AQM business, financial services business, and corporate services are each classified as strategic business units (SBUs).
The Corporate Services SBU provides common administrative, payroll, and procurement services.
In the preceding figure, the strategic business units are linked by double-headed arrows to the companies that execute the
transactions. Three companies enter into transactions that are classified as the AQM division: the US sales and manufacturing
companies, InFusion AQM Sales Inc. and InFusion AQM Manufacturing Inc., and the UK sales company, InFusion AQM UK
Ltd. One company enters into transactions for financial services exclusively. The holding company enters into transactions
that can be classified as either division- or corporate-level transactions.
Financial Representation
Each InFusion company accounts for itself in Oracle Fusion General Ledger. All the companies except InFusion Financial
Services, Inc. share the same chart of accounts.
• In the American region, InFusion Corporation, the holding company, and both of the AQM companies share the
same ledger. Each company has a unique primary balancing segment value to identify it for reporting.
• InFusion Financial Services Inc. uses a separate ledger and chart of accounts for regulatory compliance reasons.
• InFusion AQM UK Ltd is in the EMEA region and uses pounds sterling. InFusion AQM UK Ltd therefore uses a
separate sterling ledger.
• As the UK and US AQM ledgers differ only in currency, reporting for all of the InFusion AQM and InFusion Corporate
business is generated from one balances cube. Reporting for the InFusion Financial Service business is generated
from its own balances cube.
• InFusion Financial Services accounts for itself in an exclusive ledger, and therefore has its own business unit.
• InFusion AQM UK Ltd has one UK AQM BU that tracks and generates transactions accounted to the InFusion AQM
UK LTD ledger.
• The US AQM BU serves the sales and the manufacturing AQM companies. Transactions generated by the US AQM
BU are accounted for in the InFusion Corporate ledger.
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• The US Procurement BU processes requisitions transactions for the other InFusion companies. The other companies
and their ledger account values are specified on the products and services US Procurement BU procures for them.
The accounting is transferred to their ledgers according to the appropriate shared service model.
The following figure illustrates how the InFusion ledgers and business units (BUs) are modeled for the Oracle Fusion
Financial Applications.
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• Two BUs generate transactions that are accounted for in the US AQM Ledger.
• The US Procurement BU directs transactions to the BUs of companies that use the Financial Services and UK
ledgers for completion.
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• Oracle Fusion General Ledger to process transactions using journal entries, which are posted to update the General
Ledger balances.
• Oracle Fusion Subledger Accounting rules engine to account for transactions from Oracle Fusion subledgers, such
as Payables, Receivables, Assets, Inventory, and additionally, from other data sources, by applying the desired
treatment.
• Advanced intercompany accounting capabilities to provide a framework for effectively recording, managing, and
reconciling intercompany transactions.
• Reporting and analysis tools to provide various types of user interaction experience and formatted report outputs to
optimally fulfill your business requirements.
• Drill down capability to facilitate user review of summarized balances, drill down to detail balances, and trace
balances to the source journal entries and originating transaction details.
• An allocation engine to support complex formulas to distribute revenue and costs throughout the organization by
generating journal entries.
• Oracle Hyperion Data Relationship Management, Fusion Edition, if licensed, to map the Oracle E-Business Suite,
PeopleSoft, or JD Edwards organization to your organization's taxonomy or numbering system in Oracle Fusion.
Subledger Accounting
The Accounting Hub process begins with accounting from Oracle and non-Oracle subledgers, Oracle E-Business Suite
General Ledger, and other general ledgers that are linked to Accounting Hub, and flows through the Oracle Fusion General
Ledger. The process ends with complete reporting and analysis solutions. Subledger and general ledger products that
generate accounting recognition and valuation events, invoke the Oracle Fusion Subledger Accounting engine through the
Create Accounting process to create journals.
The following figure illustrates the working of the Oracle Fusion Accounting Hub. It depicts a hub that transforms and
integrates data from external systems, Oracle E-Business Suite, Oracle PeopleSoft, and Oracle JD Edwards General Ledgers
as well as Oracle Fusion Subledgers into a controlled financial system. The financial system is capable of superior and real
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time reporting in itself, and publishes high quality output to Oracle Hyperion Enterprise Performance Management and other
products such as, Oracle Hyperion Planning, Fusion Edition, and Oracle Hyperion Financial Management, Fusion Edition.
As indicated in the preceding figure, within the Oracle Fusion Accounting Hub, product integration facilitates the integration
with Oracle E-Business Suite and Oracle PeopleSoft General Ledgers. An application programming interface (API) facilitates
integration with other systems.
Oracle Hyperion Data Relationship Management, Fusion Edition drives the integration of the system taxonomies and master
data.
Subledger Accounting captures the events, accounts for them under different accounting conventions, posts them in detail or
summary to Oracle Fusion General Ledger, and stores them in financially oriented and standardized accounting subledgers.
Oracle Fusion General Ledger tracks the accounting at a distilled level that is specified by you, and preaggregates the
balances in the balances cube.
The Financial Reporting Center provides financial reporting and inquiry with the Account Monitor and Account Inspector.
Smart View provides spreadsheet analytics and Oracle Transaction Business Intelligence, Oracle Business Intelligence
Analytics, and Oracle Business Intelligence Publisher provide key performance indicators (KPI), dashboards, and flexible
reporting.
Oracle Fusion Subledger Accounting creates accounting for external systems and for Oracle Fusion Subledgers.
Using Subledger Accounting in the Accounting Hub provides the ability to exercise granular, transaction level control, and
achieve consistency with International Financial Reporting Standards (IFRS) accounting requirements and US Generally
Accepted Accounting Principles (GAAP) compliance.
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The Accounting Hub's inclusion of Subledger Accounting provides an accounting transformation engine that powers
integration in several directions, for example, from different external systems to Oracle Fusion General Ledger or from one
general ledger to another. Functionality includes:
• Accounting event data captured, along with references from multiple sources, through an open interface, which
accommodates a high volume of data.
• Accounting rules created for events, with support for multiple representations.
• Accounting transactions transferred and posted to Oracle Fusion General Ledger where they are aggregated for
analysis and financial reporting.
• Transformation engine used to enforce accounting policies and provide centralized control and detailed audit trails,
while simultaneously accommodating diverse corporate, management, and reporting requirements.
Note
The Accounting Hub can be deployed in many situations. For example, you could take data from one system and
use the Accounting Hub to post it according to US GAAP and IFRS to create two different representations for
external reporting.
• Errors that have occurred and the actions that you need to take
• Information to quickly resolve exceptions, expedite approvals, and focus on understanding the business results
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The first level of reporting appears in the General Accounting dashboard. You can save the data in portlets on the dashboard
to a spreadsheet, analyze it using the spreadsheet functionality, and report on it separately.
Note
Segment values that are not included in your reporting account hierarchies are not available for queries in Oracle
Fusion Transactional Business Intelligence. To query these segment values, add a node to represent the segment
to your reporting account hierarchies with a range of values from 000 to ZZZ.
Related Topics
• Trees: Overview
99-ZZ-inventory $10,000
01-A1-inventory $1,000
01-C2-inventory $3,000
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02-B3-inventory $6,000
99-ZZ-inventory $10,000
99-ZZ-interco-01 $4,000
99-ZZ-interco-02 $6,000
01-A1-inventory $1,000
01-C2-inventory $3,000
01-A1-interco-99 $1,000
01-C2-interco-99 $3,000
02-B3-inventory $6,000
02-B3-interco-99 $6,000
As a result, Company 99 is in balance, as are companies 01 and 02. Equally, divisions A1, C2, B3, and ZZ are balanced. The
balancing entries are eliminated on consolidation.
In Oracle Fusion Applications, you can deploy three such segments. The first one is called the Primary segment and
is required. The intercompany segment, if you use one, is associated with the Primary segment. The Primary segment
normally represents legal entities or companies. A value in the segment is assigned to each legal entity during accounting
configuration.
The other two balancing segments are optional and can represent other parts of your enterprise, such as divisions or
strategic business units. Balancing segments are the appropriate chart of accounts segment to use when you want to
monitor an organization's retained earnings and your investment in it, or track its assets, liabilities, and equity (net balance
sheet).
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The General Ledger posting process updates your balances and stores these balances in a balances cube for efficient
multidimensional analysis. This preaggregated functionality provides for efficient reporting. Oracle Fusion General Ledger uses
the balances cube in several reporting paradigms.
You access reports in several ways in Oracle Fusion Financials:
• The Reports and Analytics work area provides a central place for you to quickly view or run any operational or
analytical report relevant to your work. You can select Navigator, Tools, Reports and Analytics to go to the
Reports and Analytics dashboard.
• The Financial Reporting Center provides inquiry and reporting through the Financial Reports functionality and the
Account Monitor.
• Oracle Hyperion Smart View for Office, Fusion Edition provides access from your desktop spreadsheet product.
• The product work areas provide information users need to perform tasks they need to do. The Account Monitor is
located on the General Accounting dashboard, as well as in the Financial Reporting Center. You can view the impact
of a general ledger adjustment in the Projected Balances pane of the Create Journals page before completing the
transaction.
The following figure illustrates the Oracle Fusion General Ledger preaggregated dimensional balances and journal entries
together with the principal reporting capabilities. The Financial Reporting Center includes financial reporting, snapshots, new
reports, and dissemination; and the Account Monitor and Inspector provides drill and pivot views of your balances. Smart
View provides desktop driven ad hoc, formal, and spreadsheet integrated reports. Oracle Fusion Transactional Business
Intelligence provides day-to-day key performance indicators (KPIs) of any item in the Oracle Fusion Financials, Oracle
Business Intelligence Analytics for portal monitoring, and Oracle Business Intelligence Publisher (BI Publisher) for formatted
reports and documents.
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The following table lists some major financial reporting needs and the products and features that you can use in Oracle Fusion
Financials to meet those needs:
Boardroom ready financial statements with live drill Financial Reporting in the Financial Reporting Center
down to your source transactions
Exception based account monitoring with Account Monitor and Account Inspector in the Financial
multidimensional analysis and drill down capability Reporting Center and from the General Accounting
Dashboard
Spreadsheet financial reports with multidimensional Oracle Hyperion Smart View for Office, Fusion Edition
analysis, pivoting, and drill down capability
High volume operational reporting with configurable Oracle Business Intelligence Publisher (BI Publisher)
templates. Examples include Journal Batch Summary,
Collections Aging 4 Bucket, Asset Additions, Payables
Cash Requirement, and many more.
Key performance indicators (KPIs), metrics, and highly Oracle Business Intelligence Analytics
summarized queries from a data warehouse
The Financial Reporting Center also facilitates efficient, secure distribution of reports to authorized individuals. You can
perform multidimensional analysis and drill down from any of the live reports.
You can choose to review reports in your preferred format such as, HTML, PDF, or Microsoft Excel.
The Financial Reports functionality includes:
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• Expanding or drilling down from any parent value to the next parent or child value
• Expanding or drilling down from any child value to detail balances, journal lines, and subledger transactions
• Building multidimensional reports, with multiple hierarchies, using a client based tool, Oracle Hyperion Financial
Reporting Studio, Fusion Edition
• Distributing reports automatically across your organization using e-mail or other distribution mechanisms
• Storing reports in a repository folder structure, using various formats, including PDF, HTML, and spreadsheets
• Use drill down from the Account Monitor from any parent value to the next parent or child value
• Perform drill down from any child value to detail balances, journal lines, and subledger transactions
Related Topics
• Setting Up Your Financial Reporting Center: Critical Choices
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Smart View provides the ability to create and refresh spreadsheets to access real time account balances and activity. You can
use the Smart View for:
• Report design
Report Design
Report design is another dimension of Smart View, which leverages the capabilities of Oracle Fusion General Ledger data.
Once the data is available within Smart View you can create reports as needed based on a combination of data sources. For
example, planning and financial management data can be used to compare actual to budget. Reports can be made more
complex by providing the ability to compare multiple scenarios for different periods. The power of Smart View is used to
create reports and is refreshed periodically, as needed.
Smart View provides the ability to create and refresh spreadsheets to access real time account balance information. You can
use Smart View to:
• Drill down from any parent value to the next parent or child value
• Perform drill down from any child value to detail balances, journal lines, and subledger transactions
• Apply date effective hierarchies to past, present, or future hierarchies to change the financial data reported in your
financial reports. For example, to compare 2010 to 2011 results, realign the data in your 2010 reports by applying
the 2011 organization hierarchy.
Related Topics
• Oracle Hyperion Smart View for Office User's Guide
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Report Links
The Reports and Analytics work area contains links to reports and analytics from the Oracle Business Intelligence
Presentation Catalog in an organized hierarchy. In the Reports and Analytics work area, business intelligence analysis and
dashboards are categorized as Analysis and Oracle Business Intelligence Publisher reports are categorized as Reports.
Multiple instances of the same report but with different parameters may exist in one work area and within the same folder in
that area. Links to the same report may be in multiple folders.
• Spreadsheet Integration
• Report layouts using familiar desktop tools, such as Adobe Acrobat PDF, Word, and Excel
• Reports published in various outputs such as Word, Excel, PDF, RTF, and HTML
• Drag-and-drop functionality to build the report layout, and immediately run the report to obtain real time results
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• Shared queries and reports using the Report Catalog, a reporting option used to view or save specific definitions
• Supports real time, ad hoc queries from an Oracle Fusion balances cubes and external data warehouses
• Contains prebuilt key performance indicators (KPIs) and metrics that deliver information throughout all levels of the
organization
• Preaggregates data to summarize information across multiple data sources for faster queries
Spreadsheet Integration
Throughout Oracle Fusion General Ledger and Oracle Fusion Financials, in addition to the spreadsheet features in Financial
Reporting, Account Monitor and Account Inspector, Smart View, and Business Intelligence, you can transfer data easily and
promptly to spreadsheets. Watch for the XLS icon on the toolbar associated with a tabulation of data. Selecting the icon
creates a spreadsheet tab with the displayed information.
Oracle Fusion Financials facilitates importing data by using prepared spreadsheet templates that include validation and
control features.
Caution
When working with these spreadsheets, changes are not recorded in Oracle Fusion Applications until the
spreadsheet is uploaded. The upload will appropriately fail unless users follow the conventions, statuses, search
requirements, refresh requirements, and other instructions associated with the spreadsheet.
Related Topics
• Working in Desktop Integrated Excel Workbooks: Points to Consider
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Companies can also buy, hold, sell, and hold consignment inventories, and sell to sales subsidiaries in the group, forming
centralized inventory and bonded warehouses.
These capabilities support the configuration of shared services. If the company executing the service provider BU business
is different from the company executing the client BU's transactions, same ledger or not, it is formal cross company shared
services. Formal shared service arrangements imply profit and tax management, and intercompany billing. If the same
company is executing both the shared service and client BU transaction, there is no profit and tax management, and the
business classification can be done by cost center allocations, or grossed up with care to avoid exposure to transaction tax
(intracompany).
A company (or other kind of legal entity) that is using a unique BU exclusively will often have representation in the chart of
accounts: the company code in the primary balancing segment. When this is case, the BU profitability can be read from
General Ledger sing that company code.
Subject to the availability of subledger data, a BU can tag transactions with any value in the chart of accounts associated with
its ledger. A BU can therefore perform transactions for other businesses, and tag them correctly for financial reporting.
A business will usually have a code or group of codes in the chart of accounts, in one of potentially two secondary balancing
segments, or in non-balancing segments. Prefinancial transactions, which have not yet been stamped with the chart of
accounts value, will be classified by the BU only. To ensure prefinancial subledger reports have common elements in addition
to ledger and company with accounted reports, you can align a series of management codes in the chart of accounts with
your BUs.
BUs that perform as service providers by definition will have the services provided accounted for in other BUs, and will
not report profitability for those transactions. However, they can measure their own transactions, either through their own
accounting or through a distinct BU.
Business Units assist management to track business transactions from initiation until documentation (e.g. invoicing) as
a financial transaction. Oracle Fusion Subledger Accounting and Oracle Fusion General Ledger track each company's
accounting and its classification of transactions as required (cost center, management entities, expense and revenue, etc.)
Subledger accounting and general ledger transactions are bounded and secured by ledger, rather than by BU.
Transactions in subledgers are posted to the general ledger as part of the close process. Post routines are flexible, and
are driven by calendars maintained by Payables, Receivables, other subledgers, and the general ledger. When all of the
transactions in a BU are posted, the BU can be closed. There are closing routines associated with BUs, such as reconciliation
and reporting.
Business units in the subledgers provide a natural boundary for subledger reporting. Access Control provides an ability to
aggregate reports from many BUs, currency permitting. Data that has been stamped with account combinations can be
reported at less than a BU level. You can run an aging, for example, on a company code or a secondary balancing segment
code (management entity) within a BU. In this way, BUs provide subledger reporting in respect of businesses, processing
centers, and companies. When the BUs are aligned with chart of account values, they provide an extension to values in
the ledger. For example, a BU subledger report against receivables, such as an aging, can expand the general ledger
balance analysis for a business, listing which open and aged invoices are attributable to or classified by that business, or for a
company, listing which receivables are owned by and due to that company.
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Example
The following figure illustrates a potential company, business unit, and ledger relationship using the fictitious InFusion
Corporation and its associated companies.
The five InFusion companies operate through four business units, which are used to track business that is accounted for in
three ledgers and reported from two balances cubes.
• InFusion AQM Ltd. uses a different currency than the parent and domestic companies. Its own BU develops its
business transactions at an overseas operation. InFusion AQM Ltd accounts for itself in its own ledger.
• InFusion Corporation, InFusion AQM Sales Inc., and InFusion AQM Manufacturing Inc. account for themselves using
Primary balancing segments in a single ledger in the domestic currency of the group.
• Because the AQM UK Ledger and the AQM US Ledger share the chart of accounts, they also share a common
balances cube.
• Transactions are accounted for in this ledger from a the AQM Unites States BU that is dedicated to the ledger, and
serves both Infusion Corporation, InFusion AQM Sales Inc., and InFusion AQM Manufacturing Inc.
• InFusion Corporation operates a Requisition BU as a service provider to AQM US BU and the Financial Services
BU. This BU does not generate any accounting in its own right, and therefore is not associated with a ledger. Its
requisitions are completed by the Procure to Pay processes in the 2 BUs to which it provides services.
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• Provides a predefined, guided list of tasks for a full end-to-end visibility to all setup requirements enabling business
users with self-service to implement quickly what they need and when they need it.
• Provides configurability of the Oracle Fusion offerings to mold the offerings to fit the business needs.
• Provides export and import capability to let companies setup one instance and reuse it several times.
• Provides a guided process making it easy to navigate through planning, implementation, deployment, and ongoing
maintenance.
• Provides a set of comprehensive reports to give full visibility to setup at any time.
An example of intuitive set up and configuration is the area of allocations. For example, accountants need to understand the
source and target balances, and specify calculations using different dimensions. Oracle Fusion delivers the graphical, wizard-
driven rule designer that simplifies creating allocations in a multidimensional environment.
• Getting Started
Getting Started
This phase is also known as the Plan and Configure phase. It is the first phase in the process.
In this phase, the implementation manager:
• Plans and discovers what offerings, options, and features are available in Oracle Fusion applications
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• Selects the most suitable offering, options, and features based on the requirements
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• Invoice imaging
• Tax
• Subledger accounting
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Understanding Financials Financial Subledger Architectures
immediately in the work area of the Accounts Payables (AP) specialists. The AP specialists can compare the image and the
data before approving it.
Oracle Fusion Applications manages the file network system, document repository, image processing server, and the routing
process with little or no human involvement.
The following figure illustrates how images are processed.
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Understanding Financials Financial Subledger Architectures
The following figure illustrates the different tiers of the tax architecture.
• Tax regimes and taxes, such as GST, VAT, and sales tax
• Tax jurisdiction and tax authorities, such as California and Ireland
• Tax status of different types of transactions, such as taxable or nontaxable transactions
• Tax rates including recovery rates
The Tax Determining Factors tier identifies the factors that participate in determining the tax on an individual transaction.
These taxability factors are:
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• Products such as food, books, automobiles, and furniture, with each product having a different tax arrangement
For example, you could be a legal entity registered for tax in Illinois and selling a product to another legal entity that is
registered in Toronto. To sell your product, you must take into account, the following taxes:
• US export taxes
• Toronto taxes
The processes can be internal. For example, the internal processes for determining tax can be different when cars are sent for
painting versus when they are sent for washing.
The Tax Configuration: Advanced tier leads you away from mainstream compliance into specialist cases. For example, the
advanced configuration includes setting up tax rules to determine:
• Tax regimes
• Tax basis that results from the combinations of the above considerations
Tax or recovery is calculated based on these and other factors. Tax recovery uses the Services tier to return the appropriate
tax or recovery for the product to the entity requesting it. Other services include setup and partner integration services. Third-
party tax partners deliver external data, such as tax rates, simplifying your tax processing.
The Tax Management tier includes:
• Transaction taxes and related data that are stored in tax repositories and are delivered with reports. Standard reports
are provided that you can use or copy to customize to meet your tax reporting requirements.
• Configuration data that is stored in a configuration repository. Tax records are stored in a tax record repository.
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Subledger Accounting uses a set of rules that it applies to subledger transaction data to determine the accounts to which
the data is posted, and to format and present the entries appropriately. Using the rules, the Subledger Accounting engine
generates subledger journals and stores them in the subledger accounting repository, as the preceding figure illustrates. It
creates subledger balances by customers and vendors. Subledger Accounting populates the subledger balances and creates
general ledger journals based on the frequency, detail, and formatting options that you specify. The general ledger journals
are recorded in the general ledger balances table and cube.
Subledger Accounting is capable of generating entries for the same data according to different rules, facilitating reporting
compliance to different conventions, such as statutory and corporate, or such as the old and the new principles when a new
accounting principle is promulgated. It is anticipated that the Convergence of International Financial Reporting Standards
(IFRS) and US Generally Accepted Accounting Principles (GAAP) will involve retrospective reporting under Leases, Revenue
Recognition, and Financial Instruments for all US GAAP and IFRS filing groups between 2011 and 2017.
This capability of generating entries for the same data according to different rules can also be used to create both thick and
thin general ledgers for the same business.
Related Topics
• Thick Versus Thin General Ledger: Critical Choices
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Note
The specific subledger to ledger reconciliation reports are designed for the automatic reconciliation process
and therefore not available for editing. It is straightforward to create similar reports. The Payables to Ledger
Reconciliation report is designed for use in conjunction with the AP Trial Balance report.
Related Topics
• Reconciling Accounts: How It Works with the Subledgers
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Understanding Financials Security
7 Security
• Duties
• Privileges
• Functional security
• Data security
Functional security establishes that before a user can perform a duty associated with a job role, the user must have the
appropriate privileges assigned. This three-way link between user, role & duty, and privilege is the core concept of functional
security.
Data security interacts with functional security to limit access to these financial areas that you specify:
In Oracle Fusion, users may have several different roles. For example, a user may have an employee role, an accountant role,
and a manager role.
Each of these roles grants the user with specific and different privileges. For example, the accountant role may grant the user
a set of privileges that are different from the privileges associated with the manager role.
As an accountant, the user may also have data access to ledgers that might not be accessible with just being a manager.
Roles have different aspects: data, duty, job, and abstract. Data and job roles are assigned directly to individuals though the
Oracle Identity Manager, and specify to which job areas and data the individuals have access. Duty roles are associated with
job rules, not individuals, using the Oracle Authorization Policy Manager.
A data role is a job role with a security dimension, and calls out the data access very explicitly. By comparison, job roles
and abstract roles can be assigned without specifying data access, but often incorporate implicit security. For example,
employees can only edit their own expense reports.
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Oracle Fusion Financials Glossary
Understanding Financials
Glossary
dashboard
A page that provides quick access to key tasks and summary information for various objects within a functional area of
interest.
Oracle Essbase
Stores balances from multiple data sources in multidimensional cubes. Users interact, report, and analysis data in real time
and along business dimensions and hierarchies.
snapshot report
Read-only reports previously run. Data is static as of the specific run time.
tree
Information or data organized into a hierarchy with one or more root nodes connected to branches of nodes. A tree must
have a structure where each node corresponds to data from one or more data sources.
work area
A set of pages containing the tasks, searches, and other content you need to accomplish a business goal.
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