Accounting For Costs

07
Accounting for Costs
Copyright 2010, Oracle. All rights reserved.
Objectives
After completing this lesson, you should be able to do the
following:
Describe how Oracle Project Costing uses AutoAccounting
to determine default cost accounts
Explain the differences between AutoAccounting and
Account Generator
Identify the steps for setting up AutoAccounting
Describe the integration with Oracle Subledger Accounting
7-2
Agenda
AutoAccounting
Overview of AutoAccounting
AutoAccounting for Costing
AutoAccounting and the Account Generator

Supplier Costs
Encumbrances and Project Budget Account Generation
Workflow
Integration with Oracle Subledger Accounting

Understanding Oracle Subledger Accounting
Setup Overview
7-3
Overview of Accounting for Costs
AutoAccounting
Account Generator
Oracle Subledger Accounting
Set up Oracle Project Costing to generate accounting for projectrelated costs.

7-4
AutoAccounting
Create rules in AutoAccounting to specify how Oracle Project Costing
derives default accounts.
Expenditure Item
Project
Task
Expenditure Type
Expenditure Organization
13043
1.2.4
Professional
Services-East
Cost Distribution Line
7-5
Company
Department
Account
Product
Debit
01
420
7580
000
Credit
01
000
2410
000
AutoAccounting Rules
SQL Statement
Constant
Parameter
Parameter
Lookup Set
Lookup Set
Parameter
Lookup Set
Parameter
Lookup Set
Components of an AutoAccounting rule

7-6
AutoAccounting Rule Mapping

SQL Statement
Constant
Parameter
Intermediate
Value
Intermediate
Value
Intermediate
Value
Lookup Set
Lookup Set
Segment Value
Segment Value
Code Combination Segment

Options for deriving segment values
7-7
Constant Value
Constant
Intermediate Value
You can specify a constant value for an AutoAccounting rule.
7-8
Parameter Value
Parameter
Intermediate Value
Lookup Set
Segment Value
You can specify a parameter for an AutoAccounting rule.
7-9
SQL Select Statement Value

SQL Statement
Parameter
Lookup Set
Parameter
Lookup Set
Parameter
Lookup Set
Segment Value
You can write a SQL select statement for an AutoAccounting rule.
7 - 10
Lookup Sets
Example: A lookup set for mapping expenditure types to the
cost account
Expenditure Type to Indirect Cost Account
7 - 11
Intermediate Value
Segment Value
Administrative
7620
Airfare
7640
Chemicals
7510
Clerical
7550
Computers
7520
Meals
7690
Overtime
7590
Selecting a Segment Value Source
Parameter
Constant
Intermediate Value = Segment Value
AutoAccounting rules do not always require a lookup set.

You can use an intermediate value as the segment value.
7 - 12
Assign Rules
Function
Function Transaction
Function Transaction
Segment Rule Pairings
Segment Rule Pairings
Rule - Segment 0
Rule - Segment 0
Rule - Segment 1
Rule - Segment 1
Rule - Segment 2
Rule - Segment 2
Rule - Segment 3
Rule - Segment 3
Assign rules to derive a value for each Accounting Flexfield segment.
7 - 13
Quiz
Each AutoAccounting rule you define supplies one or multiple
Accounting Flexfield segment values at a time.
a. True
b. False
7 - 14
Agenda
Overview of Accounting for Costs

AutoAccounting

Supplier Costs
Workflow

Setup Overview
7 - 15
AutoAccounting for Costs Implementation Steps

Step
Required?
Setup Level
Define accounting for labor costs

Define accounting for expense report costs
Define accounting for usage costs
Define accounting for miscellaneous costs
Define accounting for burden transactions
Define accounting for total burden costs
Define accounting for WIP and Inventory
costs
Define accounting for supplier cost
adjustments
No
No
No
No
No
No
No
Operating Unit
Operating Unit
Operating Unit
Operating Unit
Operating Unit
Operating Unit
Operating Unit
No
Operating Unit
AutoAccounting for Costs Implementation Steps
7 - 16
Accounting for Labor Costs
Labor Cost Account:
Labor Cost Clearing Account:
Debit for Labor Costs
Credit for Labor Costs
Labor Costs
7 - 17
Accounting for Expense Report Costs

Expense Report Cost Account:
Debit for Expense Report
Costs
Expense Report Costs
7 - 18
Accounting for Usage Costs
Usage Cost Account:
Usage Cost Clearing Account:
Debit for Usage Costs
Credit for Usage Costs
Usage Costs
7 - 19
Accounting for Miscellaneous Costs
Misc Trans Cost Account:
Misc Trans Clearing Account:
Debit for Miscellaneous

Transaction Costs
Credit for Miscellaneous

Transaction Costs
Account for
Miscellaneous
Transaction
Costs
Miscellaneous Costs
7 - 20
Accounting for Burden Transactions
Burden Cost Account:
Burden Cost Clearing Account:
Debit for Burden Costs
Credit for Burden Costs
For Example:
Overhead, G & A,
and Fringe
Burden Transactions
7 - 21
Accounting for Total Burdened Cost
Total Burden Cost Debit

Account:
Total Burden Cost Credit

Account:
Debit for Total Burdened Costs
Credit for Total Burdened

Costs Costs
Account for Total

Burdened Costs
Total Burdened Costs
7 - 22
Accounting for WIP and Inventory Costs
WIP Cost Account
Inventory Cost Account
WIP Cost Clearing Account
Invent. Cost Clearing Account
Work in Process Costs
7 - 23
Inventory Costs
Accounting for Supplier Cost Adjustments
Supplier Invoice Cost Account:

Debit for Supplier Cost Adjustments
(includes adjustments to expenditure items
from invoices, receipts, and payments)
Supplier Cost Adjustments
7 - 24
Listings
Use the following concurrent programs to document

AutoAccounting setup information:
IMP: AutoAccounting Functions
IMP: AutoAccounting Lookup Sets
IMP: AutoAccounting Rule Definitions
IMP: AutoAccounting Segment Rule Pairings
7 - 25
Quiz
When you run ___ for the Burden Cost process category, the
program credits a default burden cost liability account to
balance the burden cost expense account.
a. PRC: Distribute Expense Report Adjustments
b. PRC: Distribute Usage and Miscellaneous Costs
c. PRC: Create and Distribute Burden Transactions
d. PRC: Generate Cost Accounting Events
7 - 26
Agenda
AutoAccounting

Supplier Costs
Encumbrances Project Budget Account Generation Workflow

Setup Overview
7 - 27
Account Generator
GL account code combinations
Account Generator
Oracle Purchasing
7 - 28
Oracle Payables
Requisitions
Supplier Invoices
Purchase Orders
Expense Reports
Account Generator Terminology

AutoAccounting
Account Generator
Function
Item Type or Workflow
Assignments and Rules
Process
Constants
Constants
Parameters
Attributes
Lookup Sets
Lookup Values
SQL Statements
SQL Statements or
Conditional Nodes
A comparison between AutoAccounting and Account

Generator terms
7 - 29
Implementing Accounting for Project-Related Supplier

Costs and Expense Reports
Accounting setup for project-related supplier costs and expense
reports:
Oracle Purchasing Account Generator
Project Supplier Invoice Account Generator
Project Expense Report Account Generator
Supplier Invoice Cost Account AutoAccounting Function
Expense Report Cost AutoAccounting Function
Default Supplier Cost Credit Account Implementation Option
User-defined Setup in Oracle Subledger Accounting for Supplier
Cost Adjustments
7 - 30
Quiz
Parameter in AutoAccounting corresponds to Attributes in
Account Generator.
a. True
b. False
7 - 31
Agenda
AutoAccounting

Supplier Costs
Workflow

Setup Overview
7 - 32
Encumbrance Accounting and Project Budgets
Projects
Encumbrance
Commitment
Encumbrance
Obligation
Encumbrance
Invoice
Encumbrance
Example encumbrance sequence: Top-down budget

integration
7 - 33
Actual
Project Budget Account Generation Workflow
Enter budget lines.
7 - 34
Oracle Project
Costing calls the
Project Budget
Generation Account
workflow.
The workflow
generates default
accounts.
Quiz
Oracle Project Costing uses the ___ workflow process to
generate default accounts when a project budget is
integrated with a non-project budget.
a. Project Portfolio Analysis
b. Project Budget Account Generation
c. Project Assignments
d. Budget Integration
7 - 35
Agenda
AutoAccounting

Supplier Costs

Setup Overview
7 - 36
Overview of Oracle Subledger Accounting
Oracle Project
Costing
Oracle
Purchasing
Oracle Payables
7 - 37
Oracle Subledger
Accounting
Oracle General
Ledger
Oracle Subledger Accounting is an

intermediate step between subledger
applications and Oracle General Ledger.
Oracle Project
Costing
Oracle Subledger
Accounting
Generate accounting
events and create
accounting
Oracle General
Ledger
Transfer journal
entries to GL
Oracle Project Costing predefines setup for Oracle Subledger

Accounting so that Oracle Subledger Accounting accepts the default
accounting information from Oracle Project Costing without change.
7 - 38
Accounting Event Model Overview

Example business event: Charge time to a project
Charge timecard and distribute
labor costs
Generate cost accounting

events for the labor costs
Create subledger accounting for

the accounting events
Accounting events represent transactions that have a financial

accounting impact.
7 - 39
Accounting Event Model Overview

Example Event Entity: Expenditures
Example Event
Classes
Example Event
Types
Burden Cost
Burden Cost
Distribution
Labor Cost
Labor Cost
Distribution
Labor Cost
Adjustment
Labor Cost
Adjustment
An event class represents a category of business events for a

particular transaction type or document. An event type represents a
business operation that you can perform for an event class.
7 - 40
Quiz
Oracle Subledger Accounting is an intermediate step between
subledger applications and Oracle General Ledger.
a. True
b. False
7 - 41
Agenda
AutoAccounting

Supplier Costs

Setup Overview
7 - 42
Oracle Subledger Accounting for Costs

Implementation Steps
Step
Required?
Setup Level
Define custom sources

Define journal line types
Define journal entry descriptions
Define mapping sets
Define account derivation rules
Define journal lines definitions
Define application accounting definitions
Define subledger accounting methods
No
No
No
No
No
No
No
No
Site
Site
Ledger
Ledger
Ledger
Ledger
Ledger
Ledger

7 - 43

Implementation Steps (continued)
Step
Required?
Assign application accounting definitions to a

subledger accounting method
No
Setup
Level
Ledger
Assign a subledger accounting method to a

ledger
No
Ledger
Update post-accounting program assignments
No
Ledger
Define cross-entity balancing rules
No
Ledger

7 - 44
Sources and Custom Sources
Oracle Project
Costing
Oracle Subledger
Accounting
Examples of sources:
Accounted Raw Cost
Adjustment Cost CCID
You use sources to provide

transaction information to
Oracle Subledger Accounting.
Project Type
Task Organization
7 - 45
Journal Entry Methods and Definitions

Subledger Accounting Method
Application Accounting Definitions
Event Class and Event
Type Assignments
Journal Lines Definitions
Journal Line Types
Journal Entry
Description
Account Derivation
Rules
Subledger accounting setup for Oracle Project Costing

7 - 46
Associating Subledger Accounting Methods and

Ledgers
Subledger
Accounting Method
Ledger
Assign a subledger accounting method to your ledger to

determine how Oracle Subledger Accounting processes
accounting events for the ledger.
7 - 47
Post-Accounting Programs
Post-Accounting Program
Create final accounting

Oracle Project
Costing
Oracle Subledger
Accounting
Oracle Project Costing uses post-accounting programs to obtain

final accounting information for Oracle Subledger Accounting.
7 - 48
Cross-Entity Balancing Rules
Ledger
Oracle General
Ledger
Select the Enable Intracompany Balancing option for your

ledger to enable the application of balancing rules.
7 - 49
Oracle Subledger Accounting Inquiries
Oracle Subledger
Accounting
Oracle Project
Costing
View accounting event, journal entry, and journal entry line
information in Oracle Subledger Accounting, and, then drill
down to details in Oracle Project Costing.
7 - 50
Audit Reports
Use the following concurrent programs to review subledger cost
information:
AUD: Project Subledger Summary
AUD: Project Subledger Detail by Project
AUD: Project Subledger Detail by Expenditure Type
7 - 51
Summary
In this lesson, you should have learned how to:

Describe the role of AutoAccounting, the Account
Generator, and Oracle Subledger Accounting in cost
accounting
Explain the steps to implement AutoAccounting
7 - 52

Accounting For Costs

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07

Accounting for Costs

Copyright 2010, Oracle. All rights reserved.

Copyright 2010, Oracle. All rights reserved.

AutoAccounting and the Account Generator

Integration with Oracle Subledger Accounting

Copyright 2010, Oracle. All rights reserved.

Overview of Accounting for Costs

Oracle Subledger Accounting

Set up Oracle Project Costing to generate accounting for projectrelated costs.

Copyright 2010, Oracle. All rights reserved.

Cost Distribution Line

Copyright 2010, Oracle. All rights reserved.

Components of an AutoAccounting rule

Copyright 2010, Oracle. All rights reserved.

AutoAccounting Rule Mapping

Code Combination Segment

Copyright 2010, Oracle. All rights reserved.

Code Combination Segment

You can specify a constant value for an AutoAccounting rule.

Copyright 2010, Oracle. All rights reserved.

Copyright 2010, Oracle. All rights reserved.

SQL Select Statement Value

Copyright 2010, Oracle. All rights reserved.

Copyright 2010, Oracle. All rights reserved.

Selecting a Segment Value Source

Intermediate Value = Segment Value

Code Combination Segment

AutoAccounting rules do not always require a lookup set.

Copyright 2010, Oracle. All rights reserved.

Segment Rule Pairings

Segment Rule Pairings

Copyright 2010, Oracle. All rights reserved.

Copyright 2010, Oracle. All rights reserved.

Overview of Accounting for Costs

AutoAccounting and the Account Generator

Integration with Oracle Subledger Accounting

Copyright 2010, Oracle. All rights reserved.

AutoAccounting for Costs Implementation Steps

Define accounting for labor costs

AutoAccounting for Costs Implementation Steps

Copyright 2010, Oracle. All rights reserved.

Accounting for Labor Costs

Labor Cost Account:

Labor Cost Clearing Account:

Debit for Labor Costs

Credit for Labor Costs

Copyright 2010, Oracle. All rights reserved.

Accounting for Expense Report Costs

Expense Report Costs

Copyright 2010, Oracle. All rights reserved.

Accounting for Usage Costs

Usage Cost Account:

Usage Cost Clearing Account:

Debit for Usage Costs

Credit for Usage Costs

Copyright 2010, Oracle. All rights reserved.

Accounting for Miscellaneous Costs

Misc Trans Cost Account:

Misc Trans Clearing Account:

Debit for Miscellaneous

Credit for Miscellaneous

Copyright 2010, Oracle. All rights reserved.