Oracle Overview Presentations

Rajasekhar Reddy AdamCross-charge, Borrowed and Lent,Inter-Company Processing in Oracle Projects1Main ObjectivesCross Charge OverviewCross Charge TerminologyCross Charge Processing MethodsBorrowed and Lent Accounting ProcessingIntra-Operating UnitRequired SetupExampleScreen ShotsInter-Operating UnitRequired SetupExampleInter Company BillingSetup & ExampleTransfer Price RulesTransfer Price SchedulesTransfer Price Amount Calculation

2Employee - ABC belongs to Organization "Org1"He is working for a Project - "Project1" which belongs to a different organization "Org2"If he enters a Time card against "Project1", this is a cross charge transaction.Cross Charge Overview3Cross charge is the act of entering a transaction where the expenditure organization and project/task owning organization are different.Cross Charge TerminologyBorrowed and LentCross charge transactionCross charge typeIntercompany (across legal entities)Interoperating unit(across operating units)Intraoperating unit (within a single operating unit)Intercompany billingProvider operating unitProvider organizationReceiver operating unitReceiver organizationTransfer price

Cross Charge Processing MethodsBorrowed and Lent AccountingCross charge transactions between different Operating units within same legal entity (Inter-operating Unit) or between organizations within same Operating unit (Intra-Operating Unit).Creates accounting entries to pass costs and revenue across organizations without generating internal invoicesIntercompany Billing AccountingGenerates physical invoices and corresponding accounting entries at agreed upon transfer prices between internal seller (provider) and buyer (receiver) organizations when they belong to different legal entities or operating units

Intra-Operating UnitIntra-Operating Unit is a scenario where both the Provider and Receiver organization are within the same Operating Unit.Required SetupCross Charge should be enabled both at Project and Task Level. Along with the transfer price Rules Set.In the Implementation Options Screen, under the Cross Charge tab (Cross Charges within an Operating Unit), the Processing Method selected should be "Borrowed and Lent".The following Auto Accounting Functions should be setup.Borrowed and Lent Credit AccountBorrowed and Lent Debt AccountLabor Revenue Borrowed AccountUsage Revenue Borrowed Account

Steps to processEnter a Pre-Approved Expenditure Against the above project.Distribute the costs by running PRC: Distribute Labor CostsRun PRC: Distribute Borrowed and Lent AmountsRun PRC: Generate Cost Accounting Events.Run PRC: Generate Cross Charge Accounting Events.Run PRC: Create Accounting.Inter-Operating UnitInter-Operating Unit is a scenario where both the both Provider and Organizations are from different Operating Units..Required SetupCross Charge should be enabled both at Project and Task Level. Along with the transfer price Rules Set.In the Implementation Options Screen, under the Cross Charge tab (Cross Charges within an Operating Unit), the Processing Method selected should be "Borrowed and Lent". This has to be set in the Receiver Operating Unit.In the Provider Operating Unit:Go to Setup Costing Provider and Receiver ControlsSearch for the Operating Unit - Vision Services (Provider OU)Under provider controls Receiver section, add the Receiver Operating UnitEnable Allow Cross ChargeSelect Borrowed & Lent for the Processing MethodSteps to processEnter a Pre-Approved Expenditure Against the above project.Distribute the costs by running PRC: Distribute Labor CostsRun PRC: Distribute Borrowed and Lent AmountsRun PRC: Generate Cost Accounting Events.Run PRC: Generate Cross Charge Accounting Events.Run PRC: Create Accounting.Inter Company BillingWork performed by a provider operating unit and charged to a project owned by a receiver operating unit. The provider operating unit creates a Receivables invoice, which is interfaced as a Payables invoice to the receiver operating unit.For Inter Company Billing the Provider and Receiver must be in different legal entities.Steps to processConsider the following Operating units which belong to two different legal entities.Legal Entity 1 - Projects Vision Communications Receiver Operating UnitLegal Entity 2 - Projects Vision Services Provider Operating Unit

Go to SetupCosting Provider and Receiver ControlsQuery up the Provider Operating Unit (Vision Services in our example)Under the Provider Controls Tab.Setup the Receiver details as follows:Receiver Operating unit = Vision CommunicationsEnable Allow Cross ChargeProcessing Method = Inter Company BillingInter Company Billing Project = (Inter Company Project created in Provider OU)Enter an Invoice Grouping Method.

Go to SetupCosting Provider and Receiver Controls.Query for the Receiver OU (Vision Communications in our example)Under the Receiver controls Tab, setup the Provider details as follows:Operating Unit = Vision ServicesThe supplier will be defaulted based on the setup done in the Implementation Options screen in Vision Services (Provider OU) under the Internal Billing Tab.Enter a Supplier Site (mandatory). If not done the Receiver project will not be available in the Pre-Approved batches screen to enter Expenditure Items.

A Transfer Price Schedule should exist for the corresponding Provider and Receiver combination

Auto accounting Setup The function Intercompany Invoice Accounts should be configured

In Projects Vision Communications OU (Receiver Operating Unit) Create a project "Contract New Project" Enable Cross charge at both Project and Task Levels. Under the Cross Charge Section, assign an Intercompany Tax Receiving Task at the project levelIn Projects Vision Services OU (Provider Operating Unit) Create an Intercompany project type (Intercompany Billing should be enabled) The project type should be a Contract project type Create a template and project based on the above project type. In the project, under Customers and Contacts, ensure that the customer contact is be the one defined, in the Vision Communications (i.e. Receiver OU) in the Implementation Options screen Internal BillingReceiver Options (Customer name).The project should have baselined funding

Enter a pre-approved Expenditure Item against project "Contract New Project"Distribute the cost. Note: The expenditure item should be entered and distributed from the Provider Responsibility From The Provider Responsibility Run PRC: Generate Intercompany Invoices for a Single Project. Approve and Release the Invoice.Run PRC: Interface Intercompany Invoices to Receivables Go to a Receivables Responsibility for the operating unit and run the Auto invoice Import Program. Run PRC: Tieback Invoices from ReceivablesOnce the processes are successfully completed, data will be inserted into the following AP tables:AP_INVOICE_LINES_INTERFACEAP_INVOICES_INTERFACE Run the Payables Open Interface Import from a Payables responsibility (In the Receiver OU i.e. Vision Communications Responsibility) Run PRC: Interface Supplier Costs (In the Receiver OU i.e. Vision Communications Responsibility)

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