Intercompany Accounts with All Other-All Other Rules

I recently had a question about what Balancing Segment Value (BSV) to enter in the accounts for the All Other All Other rule and I have to admit it could be a little confusing. There is a technical limitation with the flexfield infrastructure we use to capture and store accounts which means we have to have some value for BSV and Intercompany Segments, even though we will substitute in the real BSV when we generate the Intercompany accounting.

Here is an example (chart of accounts is balancing-natural account-intercompany)

I define the following rule

Debit BSV Credit BSV
Debit Account Credit Account
All Other All Other 99-4000-99 99-2000-99

Then I enter a journal

Account Debit Credit Line
13-1000-00 100.00 Original Line
03-6000-00 100.00 Original Line

When I post this, the balancing lines generated are

Account Debit Credit Line
03-4000-13 100.00 Balancing Line
13-2000-03 100.00 Balancing Line

So you can see we discard the BSV and Intercompany segment from the set up and use the correct ones from the transactions. If we always reatined 99, we would be using 99 as a clearing company for everything, if you wanted to do that you would use the clearing company options.

Author: David Haimes

I'm Senior Director in the Oracle Research and Development Organization, with close to 20 years working in various roles on the development of the Financial Management product suite.  Since the summer of 2016 my focus is exclusively on working with customers and longer-term design work, particularly around next-generation functional and technical architecture. My task is to figure out NOW what the financial management system of the next 3, 5 or more years should look like and start working toward it.  At the moment the majority of my time is spent working on Blockchain or Distributed Ledger Technologies (DLT), leading the effort for all of SaaS applications.  I'm also interested in AI, Machine Learning and new UX and interaction paradigms such as chat bots. I started out in Oracle UK and found my way out to Oracle's Redwood Shores, California HQ in May 2000.  My previous role was product owner for Fusion Accounting Hub, General Ledger, Intercompany and Legal Entity products in Oracle Fusion Financials and eBusiness Suite General Ledger. I have also worked on EMEA Globalizations, Federal and Public Sector Financials, XML Payments and a variety of projects on other products down the years.

15 thoughts on “Intercompany Accounts with All Other-All Other Rules”

  1. Venkat – funny you should mention this, I had an email from an Oracle consultant about it recently too.

    It can be confusing because the same transaction can be Intercompany in one ledger and Intracompany in another, depending on your set up.

    Watch this space for a blog post to try and explain the ambiguities.

    Like

  2. David:

    this is useful information. However, I am trying to find out the mapping between AutoAccounting rules functionality and the new AGIS functionality.

    Here is a scenario – we have 43 companies (BSV values also) and 100 expense accounts and 50 revenue accounts. These companies could use these to transact between themselves.

    Where do I perform AutoAccounting rules function in R12 to setup these companies?

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  3. 47.wing (is that your real name?)

    Auto accounting rules are replaced with te Transaction Account Builder(TAB) ,which is part of Subledger Acounting. You can define rules for deriving yor accounts in TAB which are the populated on transactions automatically.

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  4. send me an email and I will tell you the story of my screen name.

    I got the Intracompany working in the ledger configuration. However, the intercompany segment is not getting populated when the system generates the balancing entries.

    Thoughts?

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  5. 47 wing

    I can’t think of any reason why your Intercompany segment would not be populated on the generated balancing lines. You should open an SR with support and let them take a look at your set up etc. It might be a bug.

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  6. Hi David,

    I have a question regarding the limitations of the Intercompany solution. It seems like the system starts populating the I/C segment with the value from the Intercompany Account setup screen when we post journals with several Legal Entities and severeal I/C’s.

    Do you know how many Legal Entities / I/C values the system can handle before it starts populating the I/C segment with the value from the Intercompany Account setup?

    We are on version 11.5.10.

    Like

  7. Hello,

    I can tell you that we are having multiple issues with the intercompany/intracompany R12 setup. For example, we setup intercompany accounting between two LEs in the same ledger, with BSVs assigned, and it does not substitute the proper IC segment. Support has told an OC consultant that you have to set it up pair by pair, and populate the IC segment yourself in the rule! If companies use balsegs to segregate Joint Ventures, etc. this can become very cumbersome.

    The other issue we had is that, if you have a US and CAD ledger, if you assign BSVs to them, you cannot enter an Interco txn with CAD in the USD ledger, even if you set up Intercompany accounting for the LE, all other/all other. It receives an ‘Intercompany Processing Error’ in the Post, with no messages as to how to proceed.

    The only way I could, for example, enter an Interco in the USD ledger with a balancing segment that technically belongs to the CAD ledger, was to not assign ANY BSVs to the legal entities, and just let intracompany take care of the balancing. We have a global chart of accounts, and global bal seg value set, of course.

    Could it be that the BSV assignments are really only useful if you are using AGIS Issuer/Receiver, and Subledger Invoicing functionality? The BSV assignments in the scenario where you just want to balance across ledgers in GL (with no approvals), does not work. It makes intercompany balancing kick in, which fails if you go across BSVs that are assigned to LEs across multiple ledgers. I have found that the only way to make this type of balancing work is to assign NO BSVs, and just set up intraco to do balancing in the ledger, no matter what LE / Ledger that BSV logically belongs to. I say ‘logically’ because to make it work, we were not assigning any BSVs to LEs. I guess we take care of the security within ledger with Segment Security in this scenario, and parents on BSVs can take care of LE reporting..

    Does this make sense to you, or am I missing something big here:-)

    Thanks.
    Angela

    Like

      1. David –

        I am encountering the same issue as Angela. However, in our scenario it is not sufficient to leave all the entries in the US Ledger. I need the offsetting entries in the CAD Ledger. If I don’t use AGIS I don’t believe I can get any entries on the CAD Ledger. Perhaps you could email me the information you sent Angela, or perhaps Oracle has come up with a solution for this. Can you please comment?

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  8. Hi,

    How can i setup a clearing company in R12? We have more than 40 BSV in same ledger (1 Balnancing segment per legal entity). We have 1 company (let’s say100) which we want to use as clearing company.

    so, i set up for each LE ALL Other – All Other rules like this:
    for LE 015: 015.xxx.100; for LE 026: 026.xxx.100. (same account for payable and receivable)

    When i post a txn crossing 015 and 026: i am expecting system to use clearing company 100.
    So for journal like:
    015.xxx.000 Dr
    026.xxx.000 Cr we want intercompany entries like

    015.xxx.100 Cr
    026.xxx.100 DR

    But instead system creates
    015.xxx.026 Cr
    026.xxx.015 DR

    What setup changes do i need to get desired results?

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    1. For a manual journal there is a clearing company option, you can specify the clearing company option on the journal header.

      Otherwise please look at the Intracompany balancing options set up screens for the clearing company set ups.

      Like

  9. Thanks for publishing this information. I’m hoping you can help with a situation we have in one LE that really needs two different default clearing balancing segment values. We would like to be able to setup an Other-Other intracompany balancing rule to have specific rules for 5 bsvs that will create entries using what amounts to a clearing bsv and the rest use another bsv. But we can only enter one clearing bsv for the rule.

    I’ve tried using the M:M and Default Rule combination but then the bsv I entered for the accounts is overridden by the actual (it doesn’t really make sense anyway to use all other-all other to provide this information). I don’t know, we just need a way to tell the system to use x in some cases as the bsv and y in all others.

    I ran into this problem before and created a different rule for a different category (via FAH). The problem here is that the data is coming from AP and AR and I don’t see how to change the category as I could in FAH. Even though the FAH model exists for AP and AR I can’t change it to create a new event, category, etc. So why even use FAH For AP and AR. That’s a whole different question though.

    Any ideas?

    Thanks,
    Jason

    Like

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