Great Blog for Financial Accounting Hub Information

I have mentioned the Financial Accounting Hub (FAH) before on this blog, but have never really gone into a lot of detail.  The good news is that you don’t need to wait for me to get around to writing about it, Sven Van Leempt has got some great posts on his blog, he has real world experience implementing FAH and in particular integrating it with Peoplesoft GL.  I would recommend starting with is post explaining the relationship between FAH and the Subledger Accounting(SLA), this is a question that comes up a lot.

Financial Services Accounting Hub(FSAH) is now called Financials Accounting Hub (FAH)

The Financial Services moniker was always misleading because there is nothing specific to the Financial Services industry in the product, now this has been fixed and the official name is Financials Accounting Hub. So that one is cleared up.

I have had a number of people asking for more details on this product, you can start with Oracle’s data sheet or the link above to the oracle.com FAH site. There is a nice article introducing FSAH and SLA on the Oracle Consulting Solutions site by Sven van Leemput, this is a a good read. There is also presentation on slideshare from capgemini and kpn telecom about their experience with the Accounting Hub, nice to see some practical examples, even if it is at a high level. I have not done a metalink search recently, but I am sure there is plenty of information there too for those with access to metalink and of course there are the OTN forums.

Anyone else have any good sources of information – please share them via the comments.

FSAH and AGIS Intercompany Implementation thoughts

Written by David Haimes

As Intercompany transactions are very likely to cross systems they are a good candidate for integration in a ‘Hub’ of some sort.

In R12 the Financials Services Accounting Hub (FSAH) allows integration of third party systems to Oracle and is incredibly powerful and flexible.

Let’s use a simple example:

Company A and B both use two different Ledgers. A Sales Invoice is issued by Company A (to Company B) for $5,000

The accounting needs to be created as below, they need to be booked with the same accounting date in the same period.

In Company A

Debit Intercompany AR $5,000
Credit Intercompany sales $5,000

In Company B

Debit Expense or inventory (per content), $5,000
Credit Intercompany AP, $5,000

So there’s a number of options that come to mind (in no particular order).

1) Using Oracle Accounting Hub you can account for transactions form third party systems, it uses the Subledger accounting engine to process accounting events defined for the third party system. If your invoice systems are third party applications, you could create 2 events (one for each company/ledger/party to the transaction) for the sales invoice and get the full accounting out of the single system integration.

2) Enter these transactions in AGIS, the specific accounting will be entered/generated and approvals from company A and B obtained before AGIS either books it direct to GL or generates the Invoice for company A and B if required.

3) It may not be ideal to force users to navigate to a different screen (or change some import process, EDI, XML feed etc) to issue Intercompany invoices from other invoices as in 2) above. So continue to enter in your regular sales invoice system but run a process which detects an invoice is Intercompany and cancels it, then generates a transaction for it in AGIS (via the Open Interfaces) or FSAH.

I don’t think any one of these is right for all situations, detailed analysis of the particular implementation environment and requirements needs to be done to figure out the best approach. If you have any thoughts, better suggestions or experience then please share them in the comments.

Financial Services Accounting Hub (FSAH)

Financial Services Accounting Hub or FSAH (pronounced F-saa apparently) is a great product and is not only for Financial Services companies either, I understand we’ll sell it to anyone.

From a (very) high level perspective it allows you to use Oracle SLA and GL to perform the accounting for third party applications. Companies the Financial services industry tend to build a lot of highly complex applications (e.g. loan systems, trading systems) in house, but they want the final accounting of transactions form these disparate system to end up in the same place and it will be nice if they can re-use the same accounting rules too. Continue reading

The Armchair Architect

One of the more powerful additions to Oracle financials in R12 is the Subledger Accounting Architecure (SLA or SLAA) and it brings new concepts and terminology which may be hard to figure out.

The good news is there is a blogger to the rescue.  Anne Wong is The Armchair Architect and she’s starting to get SLA content up on her new blog.  I’d like to claim some credit as I badgered her into starting the blog, hopefully she will get regular readership and positive feedback to keep her momentum and get all that knowledge from her head onto the web so we can all benefit.

Defining Intracompany Balancing Rules

Written by Rohit Kathuria and David Haimes

In order to take advantage of the automatic Intercompany balancing during GL posting and SLA Accounting you first need to define the accounts you want us to use.

Intercompany and Intracompany Accounts in R12 are defined in two different Set Up Pages, the Intracompany Balancing Rules are what we had in 11i for Intercompany Accounts (confusing I know) – this is where you will find the rules you had in 11i of you are upgrading from 11i. If you don’t want to take advantage of the Legal Entity Configurator product and define Legal Entities and map them to your accounting structure, you can still go ahead and use the intracompany rules. If you start to map your Legal Entities to Ledgers and/or Balancing Segment Values (BSV) then you will want to be sure you complete the job, so there is no ambiguity in your setup. Consider the example below Continue reading

R12 Intercompany Accounts Set Up

In R12 the Intercompany Accounts setup is broken out from GL and included in the Advanced Global Intercompany System (AGIS) product (Don’t worry you don’t need any additional license for this product). There is a separate set up screen for Intercompany and Intracompany Accounts. The same set up pages are available through the Accounting Set Up Manager as well as AGIS so you can pick your navigation path. Continue reading