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Designing a Global Chart of Accounts and Taking Advantage of Oracle® E-Business Suite Release 12

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Written by Helene Abrams Tuesday, May 15 2012

A chart of accounts is a list of accounts used by a business to classify financial transactions. In Oracle E-Business Suite (EBS), the chart of accounts is called the accounting flexfield and is one example of a number of key flexfields in EBS that store values in a table structure for integration with other parts of the enterprise resource planning system. A good chart of accounts provides flexibility for recording and reporting accounting information, provides structure for managing business uniformly, and enhances communication across all parts of the business. A great chart of accounts takes care and consideration in the design phase, with particular focus on five key criteria considerations that will maximize the life of the accounting flexfield. Companies that do not consider their long-term growth and change will eventually find that their chart of accounts is no longer suitable for tracking financial transactions according to the current state of the business.

Note: This article assumes you have a general understanding of the components of a chart of accounts in E-Business Suite. If you don’t, or if it’s been awhile, take a moment to brush up by clicking here for a quick crash course.

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Optimizing Cross-validation Rules in General Ledger

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Written by Helene Abrams Monday, September 05 2011

Cross-validation rules determine which segment values in your chart of accounts (or other key flexfields) can be used together.  Upon data entry, the rule determines and controls the valid values that may be used in conjunction with other values. This paper shows how to set up Cross-validation rules, discusses the design considerations for your chart of accounts so that you can reduce the number and complexity of your Cross-validation rules, and concludes with a list of the top seven things to remember when designing Cross-validation rules.

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If IFRS...Then, Part 2: 5 Best Practices in Designing a Chart of Accounts in Oracle E-Business Suite

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Written by Natalia Warren Wednesday, June 16 2010

To better manage the transition from U.S. GAAP rules-based to IFRS principles-based financial reporting, U.S. filers who use Oracle E-Business Suite (EBS) should determine how many different Charts of Accounts (COAs) they currently have and begin working on a plan to adopt a single global COA for every business entity and reporting unit. Although regional differences in reporting requirements will likely persist even after a full-scale transition to IFRS, this should not prevent organizations from a brutally honest assessment of the current situation. Whether organizations are running R11i or R12, a common COA will simplify external reporting and internally provide management with better and faster reports.

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Putting Numbers in Boxes: Spring Cleaning for Charts of Accounts - Part II

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Written by Helene Abrams Tuesday, February 10 2009

Last month, we wrote an article about putting numbers in boxes that presented the current chart of accounts and design considerations for a local/county government. This month, we are continuing that article with design considerations for a CoA for a high tech manufacturing company. We will refer to this company as HTM in this article. HTM has many of the same issues that the county government had, with segments representing multiple types of data and with different kinds of information within one segment. This chart is a little more complex because HTM is a global company with different statutory and regulatory requirements. Trying to get global consensus on a new chart around the world is also very difficult politically because everyone feels ownership of their current values and they want to continue doing things in the way that they are used to doing them.

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TEChanges - Agility by Design

May Puzzle

David is often referred to as Rainman due to his peculiar ability to effortlessly figure out a certain date's day of the week. He recently displayed this talent when I asked him if there was a conflict with the upcoming Fuzzy Dice Conference and our weekly court-ordered community service. He asked the date of the convention. It was April 20th, 2012.

"Oh, that’s a Friday," he said, effortlessly. "And your sentences have you committed for the next few dozen Wednesdays so you'll be able to go." And of course he was right.

One day a few weeks ago I asked out loud in the office about the date June 5th. And of all people, my brother Tommy piped up and said "Oh, that's a Tuesday."

"That's right," said David.

Well how about Otcober 3rd?

"That's a Wednesday," said Tommy. Then I asked about Christmas Day 2012.

"Oh, that's a Tuesday." David nodded in agreement.

Do we now have two rainmen? Or had Tommy figured something out?

Show solution...

Solution

Here's what was going on. Tommy was using something called anchor dates. And these dates apply to each and every year. April 4th, or 4/4 we’ll call it from now on, June 6th or 6/6, 8/8, 10/10, 12/12, are all the same day of the week, each and every year.

So too are 5/9 and 9/5, May 9th and September 5th. So too are 7/11 and 11/7, and all the above dates are the same day of the week, as is the last day in February, Leap Year or not. And they’re all the same day as January 4th, it would otherwise be January 3rd, but this was a leap year, and that’s changes the anchor day from January 3rd to January 4th.

Tommy also knew that New Year's Day was a Sunday. He was sobered up by then. And he knew it was a Sunday because Christmas was a Sunday in 2011, so New Year's Day is a Sunday, so the Anchor Day for 2012, January 4th, has to be a Wednesday!

So if that's a Wednesday, then 4/4, 6/6, 8/8, 10/10, 12/12, 5/9, 9/5, 7/11, 11/7, and February 29th are all the same day of the week, and they're all Wednesdays. So when I ask for example, about October 3rd, he knew October 10th was a Wednesday, 10/10. So 10/3 must also be a Wednesday. 12/12 is a Wednesday in 2012, so it’s 12/26, which is two weeks later. So 12/25, or Christmas Day, must be a Tuesday.

Success Tips for Oracle Project Management

  • Create a standard for documentation at the beginning of your project, and hold team members accountable for completing documentation requirements as well as keeping them at and above the standards required.
  • Before promulgating user documentation or training, it’s also a good idea to choose a representative from the among the business users base to review materials first.
  • If you are not sure about the resources and budget required, obtain several estimates from people that have experience with the same size and scope of your project.
  • Be explicit, before beginning the project, what internal resources are required for execution. This includes people, infrastructure, hardware, and software.
  • Help the project champion understand the impact your project will have on the organization and how its successful completion will make him or her an internal hero or heroine for supporting it.
  • Break up your project into smaller projects (try for projects that can be completed in 4-6 months, especially early on) to get success and demonstrate momentum.
  • Make sure that your testing includes reports, upstream and downstream interfaces, customizations, enhancements, and workflows.
  • Ensure that comprehensive transition reports and meetings between departing and incoming personnel are completed.
  • Instead of spending time and resources implementing third-party reporting, consider consolidating multiple instances, moving to a global chart of accounts (CoA), and/or standardizing on a consistent calendar.
  • Include governance, risk, and compliance management as part of the project plan.
  • Finally, celebrate the successes. Too many projects focus on defects, failures, or small cost over-runs without looking at the big picture and what was accomplished.

The Analyst Corner

John Van Decker, Research VP of Gartner, states:

"A single chart of accounts allows consistency in financial reporting across the enterprise by standardizing on common metrics and reporting structures, reduces dependencies on a separate financial consolidation system, and significantly reduces the costs incurred with ongoing, complex conversions and translations."

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