Because material status is associated with sub-inventories, lots, serial numbers, and on-hand quantity, I first looked at the status of some sub-inventories.  I noticed during the R12 upgrade, Oracle defaults the material status to “Active”.

Note:  During the R12 upgrade, Oracle will seed the following material statuses:

1. Active
2. Active : Available for Reservations
3. Active : Available for Netting and Reservations
4. Active : Available for Netting
5. Active : Not Available for Netting, ATP and Reservations
6. Active : Available for Netting and ATP

Now let’s look at an upgraded Vision instance.  After I opened the Subinventories form, I found a couple of finished goods sub-inventories.  One, FS-D, is used to hold defective items.  Right now, other than the name, there is no restriction on how these items can be used.  Someone could accidently pick and ship one of these defective items to a customer.  Because the upgrade defaults the material status, you can see that all the sub-inventories have a status of “active”.

Subinventories Status

If you query the on-hand quantity in the Material workbench form, you can see the allowable transactions for an item by clicking on the status button.  The “active” status has no restrictions and you can perform all material transactions against items with this status.

You can see when I go to the misc. issue form, I’m able to see and select items that subinventory.

On Hand Availibility - Status

But if you want to use a material status to prevent certain transactions (like picking and shipping), then you can update the default status for the sub-inventory.

Material Issue on Active Material Status

The RN_Defective status will prevent items in this sub-inventory being shipped on external sales orders.  I added the “perform miscellaneous issue of material” transaction to the disallow list to show you how Oracle prevents transactions.  Before I change the sub-inventory status, I want to show you that I can select items from this sub-inventory in the Misc. Issue form.

Material Status Definition

Now, let’s go back the Subinventories form and update the status.   Now all the material in this sub-inventory has a status of “RN_Defective”.  This will prevent us from performing the transactions in the disallowed list.

Change Subinventory Material Status

If I go back to the Misc. Issue form, you can see that the FG-D sub-inventory is not available in the list of values.

Material Issue on Defective Material Status

If I query the on-hand quantity, you can see the status is also changed.  If I want to change the status level from sub-inventory to on-hand, I need to run the “Activate Onhand Level Material Status Tracking” program.  This program will take the sub-inventory status and assign it to the on-hand level.

Query Material By Subinventory After Status Change

Run Activate On-hand Level Material Status Tracking

Now when I query the on-hand quantity, you see that the on-hand status is “RN_defective”.

Material Status After Activate On-Hand Tracking

If you want to change the on-hand status for a specific item, I can use the Update Status feature in the Tools menu to change the status back to “Active”.  Now even though the item is in a sub-inventory with a default status of “RN_Defective”, these on-hand units have a status of “Active”.

Changing Material Status

Changing Material Status

Query Material By Subinventory After On Hand Status Change

An additional feature with material status is the ability to query on-hand quantity by status.

Query Material By Subinventory

R12 Changes to Item Attributes

Here’s my tab by tab analysis for item attributes:

Main Tab – No Changes

Inventory Tab

To support the integration of Process Manufacturing, Oracle added additional Lot attributes and new grade control attributes.  There is also a new material status field.  Material status allows you to control what transactions can occur for a specific status.  For example, you can have a material status of called “QC Hold” that will not allow you to pick or ship. Material status can be assigned to a subinventory, a locator, a lot, or an on-hand balance.

R12 Changes Item Attributes - Inventory Tab

R12 Changes Item Attributes - Inventory Tab (part 2)

Bill of Materials Tab – No Changes

Costing Tab – No Changes

Purchasing Tab

To support Chargeable Subcontract Manufacturing, Oracle added an outsourced assembly field.  Also the tax field is now integrated with the E-Business Tax module.

R12 Changes Item Attributes - Purchasing Tab

Receiving Tab – No Changes

Physical Attributes Tab – No Changes

General Planning Tab

To support Chargeable Subcontract Manufacturing, Oracle added a subcontracting component field.

R12 Changes Item Attributes - General Planning Tab

MPS/MRP Planning Tab

There are new repair attributes to integrate the Depot Repair module with planning.

R12 Changes Item Attributes - MPS MRP Planning Tab

Lead Times Tab – No Changes

Work in Process Tab – No Changes

Order Management Tab

To support recurring charges in Order Management, Oracle added the periodicity field.

R12 Changes Item Attributes - Order Management Tab

Invoicing Tab – No Changes

Process Manufacturing Tab

All of these fields were added to support the integration of Process Manufacturing into the Inventory module

R12 Changes Item Attributes - Process Manufacturing Tab

Service Tab – No Changes

Web Option Tab – No Changes

R12 Changes to Inventory Organization Parameters

Like the item attributes, the changes to inventory organization parameters was the result of integration Process Manufacturing, Landed Cost Management module, and new functionality.  Here’s my tab by tab analysis of these changes.

Inventory Parameters Tab

Four new fields were added to this tab.  The Default On-hand Material Status was added to support the new material status functionality.  The Manufacturing Partner Organization flag was added to support the Chargeable Subcontract Manufacturing functionality and the Landed Cost Management flag was added to support the new Landed Cost Management module.  There was also a Locator Alias Uniqueness flag added.

R12 Changes Org Parameters - Inventory Parameters

Costing Tab – No Change

Revision, Lot, Serial, LPN Tab

A new region for Child Lot Control fields and the Auto Create Lot UOM Conversion field were added to support Process Manufacturing.  The Allow Different Material Status field was added to support controlling transactions by material status (for example, not ship items with a status of “QC Hold”).  Material status can be assigned to a subinventory, a locator, a lot, or an on-hand balance.  Lastly, there is a new region for LPN Generating Option fields.  These fields are used to support Warehouse Management (WMS) enabled organizations.

R12 Changes Org Parameters - Revision Lot Serial and LPN

ATP, Pick, Item-Sourcing Tab

A new “Enable Rules Override for Lot-Level Reservations” flag was added to this tab.  Since Process Manufacturing required more functionality around lots, this flag is most likely used by Process Manufacturing.

R12 Changes Org Parameters - ATP Pick Item Sourcing

Inter-Org Information Tab – No Change

Other Accounts Tab

Two new accounts were added to this tab.  The first one is the Deferred COGS Account field.  This account is used by the Sales Order Issue transaction type to deferred COGS until AR recognizes revenue. The second account is the Landed Cost Management (LCM) variance account.  This account is used by the new Landed Cost Management module.

R12 Changes Org Parameters - Other Accounts

Accounting

Cost of Goods Sold Recognition

In R12, Oracle linked the revenue cognition with the COGS Recognition.  If you do not recognize revenue when you ship an item then you should not recognize the cost of goods.  This requires the Cost Management module to first book COGS to a deferred account when an item is shipped and then reverse the deferral when the revenue is recognized.  When the revenue is recognized is based on revenue contingency rules that can either be entered into OM or can be apply when they are imported into AR.

For example, if your customer takes title of the item when they receive the item, rather than when you ship the item, then you will need to incorporate the delivery time into your revenue recognition rule.  Oracle Revenue Management allows you to create rules to defer for a set number of days.  This rule can be associated with an OM line or a customer ship-to site.  When the set number of days have elapsed, then Oracle Receivables when book the revenue.  Cost Management gathers this information and will book the cost of goods entry.

Now there are now two flows in the COGS recognition.  The first flow, the shipping and invoice flow, starts with the shipment of the item and books the deferred revenue and COGS.  The second flow, the revenue and COGS recognition flow, starts with the release of the revenue contingency and books the revenue and COGS.  In R12, all shipments will go through these two steps even if there isn’t a revenue rule.

Shipping and Invoice Flow

Shipping and Invoice Accounting Flow

Shipment Flow Steps

1. Shipping sends a Sales Order Issue transaction to Inventory
2. Cost Manager generates the material distribution

Dr Deferred COGS  $XX.XX

Cr Inventory       $XX.XX

3.       Create Accounting used the material distribution to create a journal entry

4.       OM sends an invoice line to AR

5.       AR applies a revenue contingency rule to the invoice when the invoice is imported.  If there is a revenue contingency, revenue will be deferred.

Dr AR Trade  $XX.XX

Cr Deferred Revenue      $XX.XX

6.       Create Accounting uses the invoice distribution to create a journal entry

7.       Subledger journal entries are interfaced to GL

Revenue and COGS Recognition Flow

Revenue and COGS Recognition Flow

1. Revenue contingency expires or is removed and the Revenue Recognition program has run

Dr Deferred Revenue  $XX.XX

Cr Revenue      $XX.XX

2. Create Accounting uses the invoice distribution to create a journal entry
3. Cost Management runs the programs to gather revenue information
4. Cost Management  runs the COGS recognition program to create the COGS recognition logical material transaction
5. Create Accounting used the material distribution to create a journal entry
6. Subledger journal entries are interfaced to GL

Integration with other Modules

New Integrations

In R12, there are three new modules that integrate with Cost Management – Subledger Accounting, Oracle Process Manufacturing, and Landed Cost Management.

The integration with Subledger Accounting changes the flow of the journal entries from Inventory, Receiving, and WIP.  The Create Accounting program will use the material and receiving transactions and WIP distributions to create journal entries.  When you look in the General Leger, you will see that journal entry source also change to Cost Management.  There have been two changes since the initial release of R12.  In R12.1.1, Oracle moved the accounting rules for the Global Accounting Engine to Subledger Accounting and in R12.1.2, Oracle created a new program to allow you to upgrade historic transactions and generate journal entries in Subledger Accounting.  These upgraded journal entries will not be sent to the General Ledger.

When Oracle moved the Process Manufacturing module functionality into the standard discrete manufacturing inventory module, the Cost Management need to extend its functionality to handle the new transactions.

In R12.1.1, Oracle introduced the Landed Cost Management Module to allow you to incorporate other types of costs into your item cost.  To handle the new transactions, Cost Management need to extended

Enhanced Integrations

With new R12 enhancements to Work in Process (WIP); Enterprise Asset Management (EAM); Inventory; and Shop Floor, Cost Management need to be enhanced to handle these new transactions.

Costing

Cost Rollup

If you use the Bill of Materials module, R12 has changed the program used to perform a cost roll-up.  The new program is called Supply Chain Cost Rollup.  In additional to this new program, R12 also changed the Cost Rollup reports

Periodic Costing

R12 introduced several enhancements to periodic costing.  These enhancements include:

• Support for inter-org transfer accounting
• Improved costing algorithm
• Support for material overhead rules
• Support for EAM
• Support for WIP job final completion costs
• Support for completion costs based on required quantity
• Support for scrap absorption
• Support for iterative periodic costing for Brazil 12.0.4
• Introduction of an iterative periodic costing manager 12.1.1

Reporting

In R12, Oracle created new inventory value reports.  These reports now can be run using an “as-of” date.  If you enter an “as-of” date, the inventory value will display the inventory value up to that date.  These new reports are:

* The Inventory Master Book Report was created to meet the Italian and Chinese legal reporting requirements.

Accruals

Accrual Reconciliation and Write-Off

In R12, there are three changes to the accrual reconciliation and write-off process.  The first is a new load program that will allow you to run it independently from the accrual reconciliation report.  The load program can also be run in refresh mode, rather than reloading all the data.  The second change is the new reconciliation reports.  There are three reconciliation reports – Accrual Reconciliation Summary,  Payables and Purchase Order Accrual Reconciliation Report, and the Miscellaneous Accrual Reconciliation report.  These reports use the Oracle XML publisher and can be exported to Excel for further analysis.  The third change is the new accrual write-off forms.

Period End Accruals

Oracle changed the period-end accruals to calculate the accrual at the PO distribution line level instead of the PO shipment line level.  This will create a more accurate accrual entry because it will use the accounting at the distribution level instead of allocating the shipment level accrual to the distribution lines.

Period End Processing

In R12, Oracle introduced three changes to help with identifying transactions that would prevent you from closing the period.  The first is the ability to drilldown to transactions from the Accounting Periods form.  The second is a Period Close Pending Transaction report and the last a more pro-active tool.  It is a new workflow that can notify users if a transaction fails the costing process.

Architecture Changes

Architectural changes in the Financial suite have been incorporated into Cost Management.  These changes include a change to operating unit to legal entity relationships, the introduction of Multiple Organization Access Control, and the introduction of invoice lines in Accounts Payable.

1. Adding fields
2. Removing fields
3. Changing a field’s placement (context, header, or line)
4. Re-ordering fields
5. Hiding fields
6. Making a fields display only
7. Making a field required
8. Defaulting a value

Before we get into an example of customizing a layout, let’s talk about the different sections of a template and how Oracle determines where to place the fields on the spreadsheet.

Sections of a WebADI Template

There are three placement areas on a template:  context, header, and line.  The context area is at the top of the spreadsheet and it provides the user information about the template and the instance it was created in.  The second area is the header.  The header fields are copied to all the lines when the spreadsheet is uploaded into Oracle.  By placing fields in the header area, you can reduce the need to enter these values for each line.  The last area is the line are.  The line area contains information about the specific record you are uploading to Oracle.

Web ADI Sections

WebADI Layout Pages

So, how does Oracle first determine if it should display a particular field and second where should it display it (context, header, line).  On the “Oracle WebADI: Define Layout” web page, you will see a check box for displaying your optional fields (required fields must be on the layout, but you can hide them) and a drop down menu for the placement.  The required fields and optional fields are determined by the Integrator definition.  If you want to add fields to this list, you will need to define a custom Integrator.

Web ADI Required Fields

Web ADI Optional Fields

After you have selected your fields, you can change the defaults for the fields.  A default can be a constant, an environment variable, a parameter, a value based on a SQL query, or an Excel formula (a value based on another field in the spreadsheet).

Web ADI Default Formula

After you have determine which fields you are including, their placement, and their defaults, you will click the next button to go to the page that allows you to further refine your layout.  In this page you will see four regions:  create layout, context, header, and line.

In the “Create Layout” section, you can determine how the spreadsheet will behave when loaded into Excel.  Do you want the spreadsheet protected?  Use a style sheet? Or, apply filters?  In the “Context” section, you can re-order or hide the fields.  In the “Header” section, you can re-order, make the fields read-only, or hide the fields.

Web ADI Read Only and Hide

In the “Line” section, you can set how many rows will appear when you load the spreadsheet, re-order the fields, change their width, or apply a frozen pane to the spreadsheet.  The frozen pane is an Excel feature that allows you to keep certain columns in view while you scroll.

Web ADI Reorder Field and Change Data Entry Rows

Steps for Creating a Custom Web ADI Layout:

1. Select the Oracle WebADI responsibility
2. Select the Layout menu
3. Select an Integrator
4. Copy the layout you wish to modify
5. Enter your new layout name
6. Modify the field layout attributes
7. Change the field order and visibility attributes
8. Optionally, create a menu function to access this new layout
9. Optionally, add your new menu function to a menu

I think the best way to explain these steps is in an example.  For this example, I want to improve the “Transaction Import” template for the Projects module.  I selected this template because it has a security function that prevents you from opening the template from the Oracle Web ADI responsibility.

My new layout will be a copy of the “Costed Transactions” layout, I will modify fields in the context section, header section, and line section.  I will also re-order and hide some fields.  It’s a good idea to create the spreadsheet you wish to modify so you can have a better visual of the current layout.  Here’s my starting spreadsheet (before my changes).

Web ADI Review Document

Web ADI Layout Before

Step 1:  Open the Oracle WebADI responsibility

This responsibility contains the menus required to create / modify a layout.

Step 2:  Click the Layout Menu

This menu will open the Layout web page

Web ADI Define Layout Menu

Step 3:  Select an Integrator

This integrator will be the one associated with the template you wish to modify.  It is listed in the “Document Creation Review” page when you are creating the document.  In my example, I will select the “Projects Transaction Import” integrator.

Web ADI Select Integrator

Step 4:  Copy the layout you wish to modify

The layout name is also listed in the “Document Creation Review” page

Web ADI Duplicate Layout

Step 5:  Enter your new layout name

This will be the layout name used in your new template.  I have found it works best if you use all capitals with no spaces.

Web ADI New Layout Name

Step 6: Modify the field layout attributes

Here’s where we start modifying the fields.  First I will move  fields from the header to the lines.  Second, I’ll remove a couple unnecessary fields from the lines section.  Next, I’ll add some fields to the header and line sections.  Lastly, I will add defaults to some of my fields.

Web ADI Add Header Field

Web ADI Remove Fields

Web ADI Default Formula

Web ADI Default Constant

Step 7:  Change the field order, display attribute, and number of default rows in Excel.

Web ADI Reorder Field and Change Data Entry Rows

Web ADI Read Only and Hide

Step 8:  Optionally, create a menu function to access this new layout

Since this integrator using function security, I’ll need to create a custom function.  I will first query an existing function and copy the values to my new function.  In the parameters field, I’ll need to change the layout name.

Web ADI Create Form Function

Web ADI Create Form Function

Web ADI Create Form Function

Web ADI Create Form Function

Step 9:  Optionally, add your new menu function to a menu

Web ADI Create Menu

After I have my new function, I can add it to the Project Super User menu.  Now I’m ready to use my new layout.

Web ADI Layout After

Back when WebADI was first introduced, it was only for upload GL journal entries and downloading FSG (Financial Statement Generator) reports.  Since then Oracle has added the over 200 different Oracle to Excel integrations from 30 different modules (see list at the bottom of this post).  Along with these standard integrators, Oracle also allows you to create your own custom integrators.  In R12.1.1, Oracle added the “Desktop Integration Framework” which takes you through the creation and modification or integrators.  There are 3 steps to using Web ADI: downloading the template, entering the data, and then uploading the data.

Downloading a Web ADI

The first step in downloading a template is to locate the responsibility and menu that is linked to that template.  Some templates can be downloaded from the Desktop Integration menu and others must be downloaded from a specific responsibility.  For security, some templates are linked to specific responsibilities.  For example, I can download the GL Journals template from the Desktop Integration responsibility but I can’t download the Project Transaction Import template from the same responsibility.

To download a template you will use the following components: integrator, viewer, layout, and content. Based on how the menu is setup, some of these components may default for you.

Integrator

The integrator defines what data you will be uploading to Oracle.  Each integrator serves a specific purpose and cannot be used to enter other data.

Viewer

The viewer is the Microsoft program you will use to enter data into the template

Layout

The layout is how the data columns are organized on the template.  You have two main sections to a template: a header and lines.  The header information applies to all the lines when the data is uploaded to Oracle.

Content

The content is a text file that you can import into your template.  You can use this feature if you have an external system that outputs text file and you want to import that into the template.

Entering data into a Web ADI template

The second step is to enter data enter your template.  Since Excel is the most common Web ADI viewer, I’ll focus on how to enter data into a spreadsheet.  After you download the template, you will see two sections: a header section and line section.  Each field marked with a “*” is a required field.  If you don’t know the valid values for that field, you can double click on the cell to open a list of values.  It’s okay to copy from other spreadsheets and to use formulas.

Uploading and Importing Your Data from Web ADI

After you have completed entering your data, you are ready to upload the spreadsheet to Oracle.  In Excel, you will need to click on the Add-Ins tab then select the Oracle menu option and then select the Upload option.  There may be a selection to validate the data before it is uploaded and a selection to launch a concurrent program.   When a Web ADI templates load an Oracle open interface table, they usually have a concurrent program to import the data into the module.  For example, the Projects module uses the “PRC: Transaction Import” concurrent program to import records from the PA open interface table (pa_transaction_interface_all).

Going Beyond the Standard Web ADI

If you want to extend the existing Web ADI templates, you can create your own layouts (adding, deleting columns) or you can even create your own integrator from scratch.  Custom integrators will allow you to import data into any module that has an API or an open interface.

MOAC not only controls what operating units you can select in modules like Payables, Receivables, Projects, and Purchasing.  It also can control the inventory organization you can select in Inventory, WIP, and Cost Management.  However it does not apply to modules that are not operating unit based like General Ledger and Assets.

Let me give you a little background on how operating units and responsibilities work in 11i and how they work in R12 using MOAC.

In 11i, you were only allowed to access one operating unit per responsibility.  The responsibility would set the operating unit based on the value in the “MO: Operating Unit” system profile.  Because a responsibility was associated with only one “MO: Operating Unit”, responsibility to operating unit relationship is one-to-one.  So, if you wanted to enter an AP vendor invoices for the US operating unit and another invoice for the Swedish operating units, you would need to change responsibilities for each invoice.

In R12, you can access more than one operating unit in a single responsibility.  Oracle changed the relationship between responsibility and operating unit.  Instead of a one-to-one, now you have a one-to-many.  This is accomplished by a new system profile called “MO:  Security Profile”.  This profile looks to an HR security profile to determine which operating units or inventory organizations you can access under a given responsibility. .  So, if you wanted to enter an AP vendor invoices for the US operating unit and another invoice for the Swedish operating units, you can enter both invoices without leaving the AP invoice workbench form.

Configuring MOAC can help you streamline financial processes that are usually consolidated. These could include creating Purchase Orders, entering AP invoices, and closing the financial modules.

If you want the ability to access the operating unit field or parameter, you will need to configure MOAC.  When you upgrade to R12, your responsibilities will still be only linked to a single operating unit.  So, this will be an extra post upgrade step.  I have identified eight steps to configuring MOAC for your upgraded R12 instance.

Moving to MOAC Steps:

1. Analyze your current responsibilities and determine which responsibilities have the same access to forms and reports but are linked to different operating units.  You should be looking for responsibilities with the same menu, request group and exclusions.
2. Analyze your user population to determine if the same users are accessing these responsibilities.   If one user has AP User in both US and Sweden, then there’s an opportunity to consolidate those responsibilities.
3. Analyze if your HR security profiles should be based on hierarchies or lists or both.  Hierarchies are easier to maintain but lists are more flexible
4. Determine if you want to associate security profiles at the responsibility level or the user level.  Associating them at the responsibility level will allow you better visibility into what operating units the user is accessing but will create more responsibilities.  Associating them at the user level will allow segregate function access (by responsibility) from data access (by HR security profiles).
5. Create your new HR security profiles
6. Create any new MOAC responsibilities and assign the new the HR security profiles to your responsibilities
7. Assign the new MOAC responsibilities to users
8. Train your users on how to use the operating unit field on their forms and concurrent programs

So, let’s see how we can do this analysis programmatically.  In the first step, I’m going to create a table for all the active users with their active responsibilities and the responsibility’s  “MO: Operating Unit” profile setting.

create table XX_MOAC_ANALYSIS AS
select fr.responsibility_id, fr.responsibility_name, fa.application_name, fa.application_id, hru.name ou, hru.organization_id,  u.user_name, u.user_id
from hr_organization_units hru,
FND_PROFILE_OPTION_VALUES,
FND_RESPONSIBILITY_VL fr,
fnd_application_tl FA,
fnd_user u,
FND_USER_RESP_GROUPS_DIRECT rgd
where organization_id = profile_option_value
and profile_option_id = 1991
and level_value = fr.responsibility_id
AND FR.APPLICATION_ID = FA.APPLICATION_ID
and fr.responsibility_id = rgd.responsibility_id
and rgd.user_id = u.user_id
and nvl(fr.end_date,’01-JAN-2020′) > SYSDATE
and nvl(u.end_date,’01-JAN-2020′) > SYSDATE
and nvl(rgd.end_date,’01-JAN-2020′) > SYSDATE;

Next I will create a table to hold the grouping of like responsibilities.  These responsibilities will have the same menu, request group, and data group access.  These responsibilities will also have the same menu exclusion options.

create table XX_MOAC_RESPONS
(responsibility_id NUMBER,
moac_id  NUMBER);

After I create the MOAC grouping table, I will populate it with this script.  The script will extract the distinct responsibilities from our first table and then try to find a match.  It will then assign a MOAC ID to those matches.  To ensure I don’t duplicate the matches, I perform a check to see if I’ve already matched the responsibility.

declare

l_count number;
l_moac_id number;

begin

l_moac_id := 1;

for c_respon in (SELECT distinct responsibility_id FROM XX_MOAC_ANALYSIS)

– check to see if responsibility_id has a moac respons id

select count(*) into l_count from XX_MOAC_RESPONS where responsibility_id = c_respon.responsibility_id;

if l_count = 0 then

– find all matches for responsibility_id
insert into XX_MOAC_RESPONS
select a.responsibility_id, l_moac_id
from
FND_RESPONSIBILITY_VL a
where a.responsibility_id = c_respon.responsibility_id
union
select distinct
b.responsibility_id, l_moac_id
from
FND_RESPONSIBILITY_VL a,
FND_RESPONSIBILITY_VL b,
FND_RESP_FUNCTIONS rpa,
FND_RESP_FUNCTIONS rpb
where
a.menu_id = b.menu_id
and a.request_group_id = b.request_group_id
and a.data_group_id = b.data_group_id
and a.data_group_application_id = b.data_group_application_id
and  a.responsibility_name <> b.responsibility_name
and a.end_date is null
and b.end_date is null
and rpa.responsibility_id = a.responsibility_id
and rpb.responsibility_id = b.responsibility_id
and rpa.action_id = rpb.action_id
and rpa.rule_type = rpb.rule_type
and a.responsibility_id = c_respon.responsibility_id
and (select count(*) from FND_RESP_FUNCTIONS rpc where rpc.responsibility_id = a.responsibility_id) = (select count(*) from FND_RESP_FUNCTIONS rpc where rpc.responsibility_id = b.responsibility_id)
union
select distinct b.responsibility_id, l_moac_id
from
FND_RESPONSIBILITY_VL a,
FND_RESPONSIBILITY_VL b
where
a.menu_id = b.menu_id
and a.request_group_id = b.request_group_id
and a.data_group_id = b.data_group_id
and a.data_group_application_id = b.data_group_application_id
and  a.responsibility_name <> b.responsibility_name
and a.end_date is null
and b.end_date is null
and not exists (select ‘x’ from FND_RESP_FUNCTIONS rpc where rpc.responsibility_id = a.responsibility_id)
and not exists (select ‘x’ from FND_RESP_FUNCTIONS rpc where rpc.responsibility_id = b.responsibility_id)
and a.responsibility_id = c_respon.responsibility_id;

l_moac_id := l_moac_id + 1;

end if;

end loop;

end;

Now that I have grouped all my existing responsibilities, I will create another table grouping the OU access by user / MOAC ID combination.  This table will tell me the number of security profiles I’ll need to create to mimic the existing OU access by user.

create table XX_MOAC_PROFILE_BY_USER AS
select
qma.user_id,
qmr.moac_id,
listagg (ou, ‘,’)
WITHIN GROUP
(ORDER BY ou) ou_group
FROM
XX_MOAC_ANALYSIS qma,
XX_MOAC_RESPONS qmr
where
qma.responsibility_id = qmr.responsibility_id
GROUP BY
qma.user_id,
qmr.moac_id;

In my last step, I’ll export all my data to Excel to do further analysis.  I’ll check to see where I can consolidated MOAC profiles into a more logical hierarchy or see where a can consolidated existing responsibilities.

 SELECT QMA.*, QMR.*,
(SELECT ou_GROUP FROM XX_MOAC_PROFILE_BY_USER qmp WHERE QMP.USER_ID = QMA.USER_ID AND QMP.MOAC_ID = QMR.MOAC_ID) OU_GROUP
FROM
XX_MOAC_ANALYSIS qma,
XX_MOAC_RESPONS qmr
where
qma.responsibility_id = qmr.responsibility_id;

Now you can export this to Excel and find the unique OU_GROUPS.  These operating unit groups represent how you user base is accessing the different combination of operating units.  You can now analyze these groups to see if you can define access based on a hierarchy.   There may be some users that access all operating units (worldwide access) and others that only access operating units in a specific legal entity (legal entity access).  If your organization has centralized processing, then you may need to combine legal entities.  Say all legal entities in Europe have a common AP processing center.  After you have analyzed operating unit access, you can analyze user responsibilities.  The MOAC_ID will identify responsibilities that can be consolidated.

After you have created the MOAC responsibilities, you can use this export to identify the users that will need this new responsibility and conversely you can identify which non-MOAC responsibilities you can inactivate.

Account Generator Workflows in “Order to Cash” and “Procure to Pay”

There are two business flows where I have found it useful to customize the Account Generator workflows.  The first is the Procure to Pay cycle and the second is the Order to Cash Cycle.

In the Procure to Pay cycle, Purchasing and Payables use the following workflow processes to automatically derive the GL accounts in the purchasing distributions and payables distributions forms. Any vendor invoice or purchase order that references a project calls a special workflow process that must be customized because the seeded version contains a dummy process.  This dummy process returns an error by design.

In the 11i Order to Cash cycle, the Cost Manger program creates material distributions for Sales Order Issue transactions (shipments from Inventory to Customers).  The COGS workflow is called during this process to determine the Cost of Goods GL account.  If you don’t modify this workflow, the seeded version of this workflow will return the Cost of Goods account associated with the item.

In the R12 Order to Cash cycle, the Cost Manger program creates material distributions for Sales Order Issue transactions (shipments from Inventory to Customers).  The Sales Order Issue is booked to deferred Cost of Goods and reversed until you run the COGS recognition program in the Cost Management module.  This program will create a COGS recognition transaction.  It is this transaction that calls the COGS workflow to get the GL accounts.  The COGS recognition transaction is a logical transaction – meaning it does not affect inventory value.  Now that we know when and where we would modify the Account Generator workflows, let’s take a look at an example.

Modifying a Payables Account Generator Workflow Example

I’m using the Payables Project Supplier process because that is a workflow that needs to be modified for you to process project-related invoices in AP.  This example will work for any Account Generator workflow, you just need to know the workflow item type name.  I’ll provide a list of them at the end of this post.

In workflow builder, perform the following steps:

1.1.    Find the Project Supplier Invoice Account Generation workflow item type

1.2.    Create a copy of the Generate Default Account process

1.3.    Create custom attributes (one for each segment in your GL accounting flexfield)

Oracle Workflow Custom Attributes

1.4.    Create a custom workflow function

Oracle Workflow Custom Function

1.5.    Associate the attributes you wish to pass into the custom function

Oracle Workflow Navigator for Account Generator

1.6.    Modify the flow to first call the custom function then assign values to each attribute and then call the Validate Code Combination process

Oracle Account Generator Workflow Flow

Oracle Workflow Node Attributes

In a SQL tool, perform the following steps:

2.1.    Create a custom package with a procedure defined in 1.4.  Make sure the  parameters of the procedure follow the workflow standard:

(  itemtype IN VARCHAR2

        ,itemkey  IN VARCHAR2

        ,actid    IN NUMBER

        ,funcmode IN VARCHAR2

                        ,resultout   IN OUT VARCHAR2)

2.2.    In the procedure use the “wf_engine.GetItemAttrText “ procedure or the “wf_engine.GetItemAttrNumber” procedure to get the attributes from step 1.5

2.3.    Add the custom logic to derive the GL account segments

2.4.    In the procedure use the “wf_engine.setitemattrtext “ procedure to set the attribute values defined in step 1.3

In Oracle Applications, perform the following steps:

3.1.    In the Account Generator Process form, update the Process Name for the Project Supplier Invoice Account Generation Item Type with the same name as defined in step 1.2

Oracle Account Generator Processes

Oracle uses Cost Elements to track and account for Inventory Cost

Oracle uses 5 cost elements to track inventory value.  When you setup an Inventory organization, you’ll be asked for default accounts for material, material overhead, outside processing, overhead, and resources.  The first two (material and material overhead) are associated with material transactions (from the Inventory module) and the last three (outside processing, overhead, and resources) are associated with WIP transactions (from the WIP module).

Inventory Organization Costing Parameters

The Relationship between Inventory, WIP, and Receiving Transactions and Inventory Value Reports

It is important to note that only material and WIP transactions affect inventory value.  Material transactions occur in the Inventory module, WIP Transactions occur in the WIP module, and receiving transactions occur in the Purchasing module.  Receiving transactions do not affect inventory value reports.  These transactions are recorded to the receiving sub-ledger and affect the receiving value reports.

Relationship between Receiving, Material, and WIP Transactions and Inventory Value

How Material Receipts flow from Receiving to Inventory

When you look at a receiving transaction (with a routing of Direct Delivery) you will see two transactions.   The first transaction is the “Receive” transaction.  This records the receipt in the receiving module and creates the accrual.  The second transaction is the “Deliver transaction”.  This records the movement of inventory from receiving into inventory.  It records the credit to the receiving module and the debit to the inventory module. The way receiving affects inventory value is when the “deliver” material transaction is created.  This transaction is not recorded in the receiving module it is recorded in the Inventory module.

Receiving Transaction Flow for Accounting and Costing

How Oracle Calculates Inventory Value

When a material or WIP transaction is processed in Oracle, the on-hand quantity is updated.  If you are using the Average Cost costing method, the average cost is also updated.  Oracle uses the on-hand quantity multiplied by the item cost to calculate Inventory value.  If you run period-end inventory value reports, Oracle will rollback the quantity and cost to the period end values.  Otherwise, the inventory value is calculated (real time) with the current on-hand and item cost.

The Relationship between Material and WIP Distributions and Inventory Value

After a material or WIP transaction has been recorded, the Cost Manager will create the distributions for that transaction.  Each transaction has two distributions per cost element.  Each cost element will have a debit and credit distribution associated with specific accounting line types.  The accounting line type tells us if this distribution affects inventory value.  If the accounting line type is “Inv Valuation” then inventory value is affected.

Inventory Value Calculation and Material Distributions

Because “Inv Valuation” is the only accounting line type that affects inventory value, we can say that the inventory value should equal the sum of the “Inv Valuation” accounting line types.  This gives us the first step in our reconciliation.   Does the sum of the “Inv Valuation” accounting line types equal the Inventory Value report?  If not, then you have a problem with the on-hand or item cost being out of sync with the material distributions.   To verify this for a specific period, you need to subtract the inventory value from last period from the inventory value for this period.

Reconciling Inventory Activity to GL Activity

After you have verified that the difference between last period’s inventory value report and this period’s inventory value report equals the “Inv Valuation” material distributions, you can verify the sum of all material distributions for each inventory valuation GL account equals the difference the same amount.  If there’s between the two amounts you know that there are some material distributions that do not have an accounting line type of “Inv Valuation”.    The main culprit for these distributions is miscellaneous issues, miscellaneous receipts, and cost updates coded to an inventory valuation GL account.  The other possible reason is if your receiving account is the same as your inventory valuation GL account.  This will cause you to debit and credit the same account when the “deliver transaction” is recorded.  You can verify this by entering the material valuation GL account with the accounting line type of “Receiving Inspection” into the material distribution form.  When you have the adjustments to your material distributions, you can now compare the material distributions amount to the difference between last period’s GL balance and this period’s GL balance.  If you are using different accounts for each cost element, you’ll need to add them together before comparing.   If you have a problem here, then look for journal entries that do not have a source of Cost Management.   If you exclude these journal entries and you still do not balance, then make sure all accounting has be created, interface, and posted to the GL.

Inventory Activity Reconciliation Worksheet

1. Entering or Importing the Supplier Invoice
2. Optionally, matching the invoice to a Purchase Order or Receipt
3. Validating the invoice
4. Resolving automatic invoice holds
5. Running the invoice approval process and approving invoices
6. Creating and approving payment

Step 1: Entering or importing the supplier invoice

The first step in the Invoice to Payment process will be to enter the invoice information into the Payables module.  You can perform this step a number of different ways.  You can manually enter the invoice into the Invoice Workbench form or the Quick Invoice form.  You can interface and then import the invoice.  You can also generate invoices based on your PO receipts.  To generate invoices from PO receipts, you need to run the “Pay on Receipt AutoInvoice Program” in the Purchasing module.

Step 2: Matching the invoice to a purchase order or receipt

If your invoice has an associated purchase order, you can match the invoice quantity and price to that purchase order.  If your purchase order is setup as a 2 –way match, then you match the invoice to the purchase order lines.  If your purchase order is setup as a 3-way match, then you match the invoice to the inventory receipts.

Step 3: Validating the Invoice

Once the invoice is entered into the system, you will need to run the invoice validation process.  This process can be run from the Invoice Workbench form (by clicking the Actions button) or you can validate invoices by running the invoice validation concurrent program.  The validation process performs a couple of different checks.  First, it checks to see if should apply any matching holds.  Then it will calculate and apply taxes, verify the GL period status, verify exchange rates, and verify distribution information is valid.

Step 4:  Resolving Invoice Holds

When the validation process places an invoice on hold, you must either resolve the hold or release the hold before payment can be made.  Some holds can be released (like price and quantity holds) and other need to be resolved.  These holds are called system holds and are need to be resolved to make the invoice valid.

Step 5: Running the invoice approval process and approving invoices

After we have a valid invoice, you will need to run the invoice approval process.  This process can be tailor to your specific business needs with the Approval Management Engine (AME).  If the invoice meets the rules to require approval, AME will determine the approver(s) and send a notification.  The approver can then approve or reject the invoice online.

Step 6:  Creating and Approving payment

After we have an approved invoice, you are ready to pay the supplier.  You can create a manual payment for this invoice or you can batch all the invoices that are due for payment.  To create a payment batch, you use the Payments Process Request and select a template.  This template will identify the invoices to be paid and determines if approval is necessary.  If approval is not necessary, the payment documents will be formatted for printing (for checks) or electronic transmission.

In Project Manufacturing, you will setup cost groups and link them to projects (via the project parameters form). When you create a transaction in a Project Manufacturing enable inventory organization, you must enter the project number in a special locator.

In WMS, you can use cost group rules to determine the cost group based on a number of different attributes.  These attributes include supplier, customer, item, locator, item status, and item category.

Let’s take a look at the difference between an inventory organization without WMS or Project Manufacturing and one with WMS or Project Manufacturing.  Both organization will buy two identical items from different vendors and sell them to two different customers.

Example 1:  Inventory Organization with the Average Costing Method

Transaction 1:  Buy 100 units @ $10/unit from Vendor A

Transaction 2:  Buy 100 units @ $20/unit from Vendor B

Transaction 3:  Sell and Ship 100 units @ $30/unit to Customer Z

Transaction 4:  Sell and Ship 100 units @ $30/unit to Customer X

In this organization, all 200 units would be received into inventory and averaged together.  Then when the items are shipped to the customer, the average cost ($15/unit) would be applied to each order.

Example 2:  Project Manufacturing Inventory Organization with the Average Costing Method

Transaction 1:  Buy 100 units @ $10/unit from Vendor A for Project A

Transaction 2:  Buy 100 units @ $20/unit from Vendor B for Project B

Transaction 3:  Sell and Ship 100 units @ $30/unit to Customer Z for Project A

Transaction 4:  Sell and Ship 100 units @ $30/unit to Customer X for Project B

In this organization, project A’s 100 units would be received into inventory and averaged together ($10/unit) and project B’s 100 units would be received into inventory and averaged together ($20/unit) .  Then when the items are shipped to the customer, project A would have an average cost of $10 and a higher margin than project B.  The units from both projects could be indistinguishable and in the same physical location in the warehouse.  But, in the system, they are tracked separately.

Cost averages at the organization, item, cost group level.

Oracle Project Manufacturing Cost Group Example

You use the Project Parameters form to associate cost groups to projects