R12 Oracle Project Accounting: Few Basic

Concepts
Once we understand the basic terminologies of PA it would be easier to move ahead with the
process.
Project: A project is a primary unit of work that can be broken down into one or more tasks.
Task: It is the small unit of work created under the project against which transaction can be
created.
Note: we cannot create transaction/expenditure items directly on the project, hence it is
mandatory for each project to have at least one task.
Project Classes:
Oracle PA has provided three pre defined project classes.
Indirect projects Track overhead activities and costs of the organization. Note: Does
not generate revenue and invoicing process.
Capital projects Track asset development activities and costs, and costs are capitalized
as one or more assets.
Contract projects - Contract projects created with external customer to track cost,
revenue, and billing.
Project Type:
The project type controls how Oracle Project Foundation creates and processes projects, and is a
primary classification for the projects your business manages. You must set up at least one
project type to create projects. You must set up project types for each operating unit.
Examples of Indirect project: Admin Project, Transport Facility etc.
Example of Contract project: External Project, Intercompany project etc.
Expenditure category: It is the category created to classify the different types of cost an
organization may incur.
Revenue category: It is the category created to classify the different types of revenue an
organization may earn.
Expenditure type:It is the identification of cost that is associated to an expenditure item.It is
assigned to the expenditure category and revenue category during the setups.
Expenditure class: It is the classification for an expenditure type as how the expenditure type
can be used to create transaction. When an expenditure type is classified for a certain type then
only those expenditure class transactions are allowed to enter.
In Oracle Project Costing we have predefined expenditure classes.
Labor:
Straight Time: For standard time entry. We use the cost rate multiple with number of hours.
Overtime: Labor cost calculated using a premium cost rate multiplied by hours.
Non-labor project costs:
Expense Reports Expense reports from Oracle Payables or Oracle Internet Expenses. You
cannot enter expense reports directly into Oracle Project Costing. Expense reports that you
import into Oracle Project Costing must be fully accounted prior to import.
Usages You must specify the non-labor resource for every usage item you charge to a project.
For each expenditure type classified by a Usage expenditure type class, you also define non-
labor resources and organizations that own each non-labor resource.
Supplier Invoices Supplier invoices, discounts, and payments from Oracle Payables or an
external system, and receipt accruals from Oracle Purchasing.
Miscellaneous Transaction Miscellaneous Transactions are used to track miscellaneous project
costs. Examples of uses for miscellaneous transactions are:
Fixed assets depreciation
Allocations
Interest charges
Burden Transaction Burden transactions track burden costs that are calculated in an external
system or calculated by Oracle Project Costing as separate, summarized transactions. These costs
are created as a separate expenditure item that has a burdened cost amount, but has a quantity
and raw cost value of zero. You can adjust burden transactions that are not system-generated.
Work In Process You use this expenditure type class for Oracle Project Manufacturing WIP
transactions that you interface from Manufacturing to Oracle Project Costing. You can also use
this expenditure type class when you import other manufacturing costs via Transaction Import or
when you enter transactions via pre-approved batch entry.
Inventory This expenditure type class is used for the following transactions:
Oracle Project Manufacturing transactions that you import from Manufacturing or Oracle
Inventory.
Oracle Inventory Issues and Receipts that you import from Oracle Inventory in a
manufacturing or non-manufacturing installation.
Example:
Sr No
Expenditure
Category
Revenue category Expenditure type Expenditure Class
1 Labor Time Labor Revenue Standard_Time Straight Time
2 Vendor Cost Service Revenue Supplier_cost Supplier Invoices
3 Travel Cost Travel Revenue Travel Cost
Expense Report & Supplier
Invoices
4 Misc Cost Misc Revenue Misc_Transactions Miscellaneous and usages
In the above examples for line number 1, time can be entered for expenditure type
Standard_Time.
Similarly for line number 2 & 4 the respective expenditure class transactions can be entered.
For line number 3 supplier invoices & expense reports can be entered as it has been classified
for two different classes.
Types of Currencies
Transaction amounts are stored in the following currencies:
Transaction Currency:The currency in which a project transaction occurs.
Expenditure Functional Currency: The functional currency of the expenditure operating
unit.
Project Functional Currency: The functional currency of the operating unit that owns the
project.
Project Currency: The userdefined project currency.
When you enter transactions in a currency that is different from functional currency or project
currency, Oracle Project Costing must convert the transaction amount to the functional and
project currencies. To convert transaction currencies, Oracle Project Costing must first determine
the exchange rate type and exchange rate date.
Task Type:
Billable Item: It is a functionality associated at the task level identifying the expenditure
items created against the task to be billed to the client.
Non Billable Item: It is functionality associated at the task level identifying the
expenditure items created on the task is only to record the cost incurred against it.
Note: We can adjust the task at the expenditure item window to make the non billable as billable
and vice versa. This is called as expenditure item adjustments.
Employee/Job bill rate Override: Incase a different rate needs to be updated for a particular job
or employee the same can be updated at the project or task level.
The employee name needs to be entered along with the bill rate, currency and period applicable.
The rate at the task level overwrites the rates at the project level and the rates at the project level
overwrites the rate of the bill rate schedule attached at the project level.
Cost rate: It is the rate defined at the job or employee level to derive at the basic cost for a
particular expenditure item. The cost rate scheduled are defined in the OU functional currency.
The cost rate can be defined at two levels:
In the setups -> Expenditure -> Rate schedule.
Overrides: Labor Costing Overrides
( Navigation: PA Responsibility->Setup->Costing->Labor->Labor Costing Overrides.)
Bill rate: It is the rate defined at the job or employee level to derive at an amount which will be
billed to the client.
The bill rate can be defined at two levels:
1. In the setups -> Expenditure -> Rate schedule.
2. Overrides: At the project level as employee or job override.
For employee override: Navigation: Project -> Options -> Bill Rates and Discount
Overrides -> Employee Bill Rate and Discount Overrides
For job override: Navigation: Project -> Options -> Bill Rates and Discount Overrides ->
Job Bill Rate and Discount Overrides
Transfer Price Rules and Schedule: Transfer price rules control the calculation of transfer
prices for labor and non-labor cross charged transactions. To drive transfer price calculation for
cross charge transactions between the provider and receiver, use the Transfer Price Schedule
window to assign labor or non-labor (or both) transfer price rules to the provider and receiver
pair on a schedule line
ICB: It is a process, where we have different legal entities involved, and the OUs under these LE
owns the employees and projects.
The OU to which the employee is assigned is called PROVIDER OU.
The OU to which owns the project is called RECEIVER OU.
Note: In ICB process, an internal invoice is generated in provider OU.
Borrowed And Lent: It is a process, where we have one legal entity involved, and the OUs
under the LE owns the employees and projects. The employee and project can be in the same OU
or different OU but the LE has to be same.
Note: No internal invoice is generated in B&L process, only accounting happens to post cost.
Labor: When an employee enters time on a specific project it is known as charging efforts of the
employee on the project for a given time frame. This time further has some cost defined to
calculate the actual cost incurred by the employees on the project.
The calculation process of the raw cost for such labor/time entered is called as Labor Cost.
The time can be entered via a third party tool or via the PA pre approved batch.
Overtime Labor cost calculated using a premium cost rate multiplied by hours.
Non labor expenditure types: The expenditure items created via supplier invoices or expense
reports are called as non labor expenditure types. The expenditure types created need to be added
in the non labor expenditure schedules.
Navigation: PA -> Setups -> Expenditure -> Rate schedule

==
Oracle Projects 11i & R12 AutoAccounting
Concept & Overview

How does AutoAccounting work?
For each accounting transaction, you define rules to determine the appropriate account to charge.
Each accounting transaction is identified by an AutoAccounting function. AutoAccounting
functions are components of programs that you submit to generate accounting entries.
How do you implement AutoAccounting?
The steps are as follows:
a). Design your AutoAccounting setup based on your implementation data.
b). Define lookup sets. Navigation Setup/AutoAccounting/Lookup Sets.
To define a lookup set, you specify pairs of values. For each intermediate value, you specify a
corresponding account segment value. One or more related pairs of intermediate values and
segment values form a lookup set.
You may need several lookup sets to map organizations to cost centers, expenditure types to
account codes, event types to account codes, or for other situations where the segment value
depends upon a particular predefined parameter.
You can use a lookup set more than once; several AutoAccounting rules can use the same lookup
set.
You define and modify lookup sets using the AutoAccounting Lookup Sets window.
c). Define rules. Navigation Setup/AutoAccounting/Rules.
Each AutoAccounting rule you define supplies one Accounting Flexfield segment value at a
time. Thus, you need to specify one AutoAccounting rule for each segment in your Accounting
Flexfield for each AutoAccounting transaction you want to use.
Some of the AutoAccounting rules you define can be quite simple, such as always supplying a
constant company code or natural account. Others can draw upon context information
(parameters), such as the revenue category for a particular posting or the organization that owns
a particular asset. You can even use multiple parameters to provide a segment value.
You can reuse the same AutoAccounting rules for many different functions and their
transactions.
You define rules based on project information that you enter. You can use these AutoAccounting
parameters as input values to your rules. Note: AutoAccounting does not use Flexfield security
rules when determining a valid account combination. You must define your AutoAccounting
rules to determine the appropriate account based on the rules required by your company.
d). Assign rules for each function. Navigation Setup/AutoAccounting/ Assignments.
When you are assigning rules to an AutoAccounting function, you may want to assign different
rules to different conditions. For example, you may want to account for indirect projects using
one set of rules, and use two different sets of rules for billable items and nonbillable items on
contract projects.
To make it easy to do this, Oracle Projects provides function transactions to each function, which
identifies commonly used conditions in which you may want to assign different rules.
You can assign rules to function transactions for each AutoAccounting function.
You complete the following steps to assign AutoAccounting rules to AutoAccounting functions
and transactions:
Enable each transaction you want to use
For each transaction you enable, you specify an AutoAccounting rule for each segment of your
Accounting Flexfield
How does AutoAccounting compare to Workflow Account Generator?
Both the account generation processes in Oracle Workflow and AutoAccounting in Oracle
Projects can create account numbers dynamically, based on transactions in Oracle Projects. This
section compares the Account Generator to AutoAccounting, and provides directions for:
Assigning a constant or lookup value to a segment
Assigning an attribute parameter to a segment
Deriving a segment value
Learning more about SQL functions to generate account codes
ACCOUNT GENERATOR EQUIVALENT IN AUTOACCOUNTING
TERMS OR FUNCTIONALITY
Workflow or Item Type Function Function
Process Defining and assigning rules to segments
Attribute Parameter
Assigning a constant to a segment Assigning a constant AutoAccounting rule to
a segment
Assigning an attribute parameter to
a segment
Assigning an AutoAccounting rule that uses a
parameter, which becomes the value (a
lookupset is not used)
Assigning a lookup set value to a
segment
Assigning an AutoAccounting rule that
passes a parameter to a lookup set to
determine the segment value
Deriving a segment value by using
SQL statements or If conditions
Using an AutoAccounting rule that derives
the intermediate value or segment value via a
SQL statement.
I have an AutoAccounting Error where do I start?
In most cases, when a user encounters an AutoAccounting error when processing Oracle Projects
transactions, you will utilize the debug log file to find the source of the error. Most
AutoAccounting errors are specific and will provide you with enough information for
troubleshooting purposes. Setting the Profile Option PA: Debug Mode = Yes will provide more
detail information in the log file.
How can I find out which parameters are valid for an AutoAccounting Function?
Run the IMP: AutoAccounting Functions report.
Can I create or edit existing AutoAccounting transactions?
Oracle Projects predefines AutoAccounting transactions; you cannot modify them, or define
additional transactions.