Adding, Deleting, Disabling Secondary Ledgers

Adding Secondary Ledgers

Add secondary ledgers to accounting setups at any time in the Accounting Options page.

If you add a balance level secondary ledger that uses a different currency from the primary ledger, a balance level reporting currency is generated for the primary ledger unless one already exists. This balance level reporting currency maintains the primary ledger's translated balances and is the source representation for the secondary ledger. In other words, when using GL Consolidation to transfer balances to the secondary ledger, transfer the balances from the source representation, the balance level reporting currency.

Prerequisite

The ledger options for the primary ledger must be completely defined.

To add secondary ledgers:

1.       Open the Accounting Options page.

2.       Select Add Secondary Ledger. This button will only appear after the ledger options for the primary ledger have a complete status.

3.       Enter all relevant fields.

The table above describes the selected fields in the Add Secondary Ledger page.

Note: After adding a secondary ledger, complete the Ledger Options step and the Primary to Secondary Ledger Mapping step to enable the secondary ledger for data entry.

Deleting Secondary Ledgers

You can only delete secondary ledgers before the accounting setup is complete. After the accounting setup is complete, you can disable the conversion of secondary ledgers. This prevents any journals that are entered in the primary ledger or source representation from being transferred to the secondary ledger.

Deleting a secondary ledger removes the ledger and all of its setup steps.

To delete secondary ledgers:

1.       Navigate to the Accounting Options page.

2.       Find the secondary ledger to delete and click the Remove Secondary Ledger icon.

Disabling the Conversion of Secondary Ledgers

Once you disable the conversion of secondary ledgers, it immediately prevents the propagation of journals from the primary ledger to the secondary ledger.

The disabled secondary ledger is still available for historical reporting and manual journal entries.

Notes:

i). Balance level secondary ledgers cannot be disabled. To stop transferring balances from the source representation (primary ledger or balance level reporting currency) to the balances level secondary ledger, stop running consolidations.

ii). Adjustments only secondary ledgers cannot be disabled because journals are not automatically transferred to this secondary ledger.

To disable the conversion of secondary ledgers:

1.       Open the Accounting Options page.

2.       In the Secondary Ledgers region, select the Disable Conversion icon for the secondary ledger to be disabled.

Note: Once the conversion of a secondary ledger is disabled, the status of the secondary ledger is changed to Disabled.

Oracle General Ledger Data Conversion Levels

Data Conversion Levels

Secondary Ledgers can be maintained at one of the following data conversion levels:
i)   Subledger Level Secondary Ledgers
ii)  Journal Level Secondary Ledgers
iii) Balance Level Secondary Ledgers
iv) Adjustments Only Secondary Ledger

Secondary Ledgers Data Conversion Levels

Conversion Rules

The following conversion rules are used to convert data from the primary ledger to the secondary ledger:

i) Chart of Accounts Conversion: If the secondary ledger uses a different chart of accounts from the primary ledger, a chart of accounts mapping is used to provide instructions for mapping accounts or entire account segments from the primary ledger to the secondary ledger.

ii) Calendar Conversion: If the secondary ledger uses a different accounting calendar from the primary ledger, the journal effective date determines the corresponding non-adjusting period in the secondary ledger.

iii) Currency Conversion: If the secondary ledger uses a different currency from the primary ledger, currency conversion rules are required to instruct the system on how to convert data from the currency of the primary ledger to the currency of the secondary ledger.

iv) Journal Conversion (Used by General Ledger Posting only): To select the journals for transfer to the secondary ledger based on journal source and category combinations. The General Ledger Posting program uses these rules to determine which journals to automatically transfer to the secondary ledger during posting.

Note: The above conversion rules do not apply to Adjustments Only level secondary ledgers because they must share the same chart of accounts, accounting calendar, and currency as the primary ledger.

Subledger Level Secondary Ledgers

The subledger level secondary ledger maintains an additional accounting representation of the subledger journals, journal entries, and balances. The subledger level secondary ledger is maintained using both Subledger Accounting and the General Ledger Posting program.

By assigning two different subledger accounting methods to the primary and secondary ledger, you can use Subledger Accounting rules to simultaneously account for the same legal entity transaction in both ledgers. This allows you to maintain multiple accounting representations of a single subledger transaction and have the different subledger journals produced in each ledger.

Note: Subledger Accounting integrates data from both Oracle and non-Oracle transaction sources. For a list of transaction sources that integrate with Oracle Subledger Accounting, query them in the Subledger Application page available from the Subledger Accounting setup menu.

When entering subledger transactions using Oracle financial subledgers that integrate with Subledger Accounting, Subledger Accounting automatically generates the appropriate accounting entries to both the primary and secondary ledgers in General Ledger based on the accounting rules defined for a particular subledger accounting method.

Journal Conversion Rules

By default, the following types of journals are replicated to the secondary ledger using General Ledger Posting, not Subledger Accounting:

 

i) journals created by Oracle subledgers that do not use Subledger Accounting

ii) manual journal entries entered in the primary ledger

iii) journals from spreadsheets or non-Oracle systems that were entered via the primary ledger's GL Interface table

Each time you post these journals in the primary ledger, they are automatically propagated to the subledger level secondary ledger, unless you defined journal conversion rules to exclude these journal sources from being transferred to the secondary ledger.

By default, journals that use the following journal sources are not transferred to the subledger level secondary ledger:

Move/Merge

 

Move/Merge Reversal

 

Revaluation

 

Subledger sources that use Subledger Accounting

Journal Level Secondary Ledgers

The journal level secondary ledger is an additional accounting representation of the primary ledger journal entries and balances. This type of secondary ledger is maintained using the General Ledger Posting Program only.

Every time you post a journal in the primary ledger, the same journal is automatically replicated and maintained in the secondary ledger, depending on the journal conversion rules specified for the secondary ledger.

By default, journals that use the following journal sources are not transferred to the journal level secondary ledger:
 

Move/Merge

Move/Merge Reversal

Revaluation

Balance Level Secondary Ledgers

The balance level secondary ledger only maintains the primary ledger balances in another accounting representation. To maintain balances in this type of secondary ledger, use General Ledger Consolidation to transfer the primary ledger balances to this secondary ledger.

If the balance level secondary ledger uses a different currency from the primary ledger, use General Ledger Consolidation to transfer balances from the primary ledger's balance level reporting currency to the balance level secondary ledger. This balance level reporting currency uses the same currency as the secondary ledger and represents the translated balances of the primary ledger.

Adjustments Only Secondary Ledger

The adjustments only secondary ledger is an incomplete accounting representation that only holds adjustments, manual adjustments, or automated adjustments created by Subledger Accounting. Create adjustments as follows:

To create manual adjustments, enter manual journal entries directly in the secondary ledger.

To create automated adjustments using Subledger Accounting, assign a subledger accounting method to both the primary and secondary ledger and define Subledger Accounting rules that transfer only the subledger accounting adjustment to this adjustments only secondary ledger.

Adjustments only secondary ledgers are useful if you do not need a complete ledger to perform management or statutory reporting. You can perform all of your daily transactions in the primary ledger and then book adjustments, such as management or statutory adjustments, in the adjustments only secondary ledger.

Using a secondary ledger as an adjustments ledger is not sufficient for companies that operate in countries that require companies to have two complete ledgers, one for statutory reporting and another for corporate accounting.

By itself, this adjustments only secondary ledger does not represent the complete accounting picture; it only holds the adjustments for the transactions contained in its associated primary ledger. Use a ledger set to combine the adjustments only secondary ledger with the primary ledger to obtain a complete secondary accounting representation that includes both the transactional data and the adjustments. Then report on the ledger set using General Ledger's Financial Statement Generator (FSG), which automatically summarizes data across ledgers in a ledger set.

Notes:

Ledger Sets enable you to group multiple ledgers together (that share the same chart of accounts and accounting calendar/period type combination) to obtain processing efficiencies, such as opening and closing periods and reporting across multiple ledgers simultaneously.

Adjustments only secondary ledgers must share the same chart of accounts, accounting calendar/period type combination, and currency as the associated primary ledger.

The Primary Ledger Setup steps in oracle r12

The Primary Ledger Setup Steps in oracle r12

•       Ledger Options

•       Reporting Currencies

•       Ledger Balancing Segment Value Assignments

•       Subledger Accounting Options

•       Operating Units

•       Intracompany Balancing Rules

•       Sequencing

•       Secondary Ledgers

•       Completing Accounting Setup

Ledger Options

•       A ledger determines the chart of accounts, accounting calendar, currency, subledger accounting method, and ledger processing options for each company, legal entity, or group of companies and legal entities.

•       Each accounting setup requires a primary ledger that acts as the main record-keeping ledger for none or one or more legal entities that use your main chart of accounts, accounting calendar, subledger accounting method, and currency to record and report on all of your financial transactions.

•       To maintain an additional accounting representation, use secondary ledgers.

•       To maintain an additional currency representation, use reporting currencies.

Reporting Currencies

To report on account balances in multiple currencies, assign reporting currencies to ledgers.

Reporting currencies can only differ by currency from their source ledger and must share the same chart of accounts, accounting calendar/period type combination, subledger accounting method, and ledger processing options as their source ledger.

Reporting currencies can be maintained at one of the following currency conversion levels:

•          Subledger

•          Journal

•          Balance

Ledger Balancing Segment Value Assignments

Optionally assign specific balancing segment values to ledgers to track non-legal entity-related transactions or adjustments using a specific balancing segment value.

Note: Assign specific balancing segment values to all legal entities in an accounting setup before assigning a specific balancing segment value to the ledgers in the accounting setup.

Balancing segment values can be added to ledgers at any time.

•          Before the accounting setup is complete, you can remove balancing segment values from ledgers.

•          After the accounting setup is complete, you can only disable the balancing segment value by entering an end date.

To assign balancing segment values to ledgers:

1.       Open the Accounting Options page.

2.       Select the Update icon for the Balancing Segment Value Assignments step.

3.       View the balancing segment values assigned to the legal entities associated with the accounting setup in the Legal Entity Assignment region.

4.       In the Ledger Assignment region, enter a balancing segment value.

5. Optionally, enter a start and end date to make the value effective for a limited   time.

To remove balancing segment values:

Balancing segment values can only be removed from ledgers before the accounting setup is complete.

1.       Open the Ledger Balancing Segment Value Assignments page. You access this page by updating the Balancing Segment Value Assignments step for the ledger.

2.       To remove balancing segment values, click the Remove icon for each balancing segment value.

To disable balancing segment values:

Disable balancing segment values by entering an end date for the value. You cannot use the balancing segment value to enter new transactions or journals after the end date. You can only use the value for reporting and viewing historical data.

1.       Open the Ledger Balancing Segment Value Assignments page. You access this page by updating the Balancing Segment Value Assignments step for the ledger.

2.       To disable a balancing segment value, enter an end date.

Subledger Accounting Options

If you assigned a subledger accounting method to your ledgers, the Subledger Accounting Options step will be displayed with a status of Complete.

If you did not assign a subledger accounting method to your ledger, then this step will not be displayed.

You can update this step at any time from the Accounting Options page. Subledger Accounting Options allow you to define how to generate the accounting entries from subledger transactions.

Note: All of the subledgers assigned to a ledger inherit its subledger accounting method from that ledger.

Operating Units

You can assign operating units to the primary ledger to partition subledger transaction data when multiple operating units perform accounting in the context of one or more legal entities.

If using an accounting setup that has legal entities assigned, the Operating Units step will be displayed. The status for this step will be Not Started.

You can update the Operating Units step at any time from the Accounting Options page. You do not have to complete this step to complete your accounting setup.

Note: If you defined operating units in the Define Organization window in Oracle HRMS, then those operating units will be automatically assigned to the appropriate primary ledger in Accounting Setup Manager.

Prerequisites

The following prerequisites are required if you plan to assign operating units to a primary ledger in the Accounting Setup Manager:

•          Define legal entities and assign them to accounting setups

•          Complete primary ledger setup steps

To Define and Assign Operating Units:

1.       Open the Operating Units page.

2.       Select Add Operating Unit to both create and assign an operating unit to the primary ledger.

3.       In the Add Operating Units page, enter the following:

-          Name: The name of the operating unit

-          Short Code: The short name of the operating unit

-          Business Group: The highest level in the organization structure, such as the consolidated enterprise, a major division, or an operation company that secures human resources information

-           Default Legal Context: One of the legal entities assigned to the accounting setup to act as the default legal context

4.       Alternatively, you can create operating units by clicking Open Organization Form to open the Define Organization window in Oracle HRMS. When you define your operating unit and assign it to a primary ledger and default legal context, you will be able to view the operating unit assignment from Accounting Setup Manager.

5.       Click Apply or Add Another to define and assign multiple operating units.

6.       To mark the Operating Units step complete, select Complete.

Note: Once you add an operating unit to a primary ledger, you cannot remove it. You can prevent the use of that operating unit by not assigning it to a Security Profile in Oracle HRMS.

Intracompany Balancing Rules

If you enabled the Intracompany Balancing option for your ledger, the Intracompany Balancing step will be displayed. The status for this step will be Not Started.

Update the Intracompany Balancing step to define rules to balance journal entries between balancing segment values that are assigned to the same legal entity or ledger.

Note: You do not have to complete this step to complete your accounting setup. You can update this step at any time from the Accounting Options page.

Sequencing

Sequencing enables you to define accounting and reporting sequencing options for ledgers and reporting currencies. You can update this step at any time from the Accounting Options page.

Note: It is not necessary to complete this step to complete your accounting setup.

Secondary Ledgers

Secondary ledgers represent the primary ledger's accounting data in another accounting representation that differs in one or more of the following ways:

•          chart of accounts

•          accounting calendar/period type combination

•          currency

•          subledger accounting method

•          ledger processing options

Use secondary ledgers for supplementary purposes, such as consolidation, statutory reporting, or adjustments for one or more legal entities within the same accounting setup. For example, use a primary ledger for corporate accounting purposes that uses the corporate chart of accounts and subledger accounting method, and use a secondary ledger for statutory reporting purposes that uses the statutory chart of accounts and subledger accounting method. This allows you to maintain both a corporate and statutory representation of the same legal entity's transactions in parallel.

Assign one or more secondary ledgers to each primary ledger for an accounting setup.

The secondary ledgers assigned can only perform the accounting for the legal entities within the same accounting setup.

Note: If an additional ledger is needed to perform accounting across legal entities or ledgers in different accounting setups, use a ledger in an accounting setup with no legal entity assigned. This can be used for multiple purposes, such as performing management reporting or consolidation across multiple legal entities.