Key features of Oracle Financials Cloud

This article provides some Key features of Oracle Financials Cloud.

Multi-dimensional reporting. This is a key feature for general ledger. General ledger in the Financials Cloud integrates with Essbase, a multidimensional database that can generate financial statement reports. You can use the data from Essbase using Oracle Financial Studio reports, using Smart View, a spreadsheet tool so accountants can retrieve these reports in a very familiar environment, in Microsoft Excel.

Extensive spreadsheet integration. You can create quite a few transactions in different modules in an Excel spreadsheet template. So in receivables, you can create customer receipts. In AP, you can create supplier invoices from a spreadsheet template that Oracle provides. This extensive spreadsheet integration also defining setups, such as GL setups, banking setups, etc. 

Embedded Oracle Transactional Business Intelligence (OTBI). Oracle delivers OTBI reports, but you can also create your own OTBI objects to answer daily business questions. This would be a reporting tool available to all of the the subledger applications, like Revenue Management and receivables, payables, cash management, etc.

Infolets and Infotiles. They help our users see what needs to be done on a day-to-day basis. These mini dashboards improve efficiency and guides the end-users through the daily processes that need their attention. Check out a separate article for more information on this: Overview of Infolets and Infotiles in Oracle Fusion Applications.

Imaging integration for Payables. You can create a supplier invoice based on an image. So that image of that invoice, a PDF document or a document ending in an extension like JPEG, JPEG can be sent to an email account that Oracle provides, and then we use technology to read the images in that document and create a supplier invoice.

Role based dashboards. These are navigational components that allow a user to do a number of functions related to their jobs in one navigational component, multiple links, multiple sections in a page, and that increases efficiencies. It reduces the number of clicks are they have to do.

Below are some Oracle Financials Cloud modules:

A detailed description and function of each Oracle Financials Cloud modules can be found here: Overview of Oracle Financials Cloud modules.

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Overview of Oracle Financials

Below is a quick diagram of the Oracle Financials Cloud Modules and how they all interact with each other. Note that most of these modules are also found in Oracle E-Business Suite.

Below summarizes some of the important modules in Oracle Financials:

General Ledger (usually abbreviated to GL)

• The Financial application that records all the finalized transactions of an organization
• Deals with Ledgers, Periods, Currencies, Accounting Convention (sometimes called SubLedger Accounting Method) and finalized financial reporting

SubLedger Accounting (usually called SLA)

• A subset application of the General Ledger that holds all the finalized transactions of the other modules (somewhat like an interface).
• Transferring data from Subledgers to the General Ledger can be done on the Balances, Journal and Subledger Level (Lowest to Highest, respectively)
• More information on a separate article: Overview of Subledger Accounting in Oracle Fusion Applications

Payables (sometimes called Accounts Payables or AP)

• The Financial application that deals with Suppliers and Payments
• Also linked to the Procurement Module via Purchase Orders and Requisitions
• Invoices can be automatically created once a Supplier has delivered the ordered goods and the organization has confirmed it.
• The Payment process can then be initiated and electronically transmitted to the Bank for Processing.
• Run Create Accounting to Transfer to SubLedger Accounting (SLA)

Expenses

• A subset application of Payables that deals with employee expense reimbursement such as Travel, Food, Accomodation, etc.
• Expenses Can be entered via Spreadsheets, Mobile Application and usually goes through an approval process
• Once approved, the expense will become a Payment Request in Payables for Reimbursement to be paid to the Employee
• Follows the same process of "Create Accounting" through Payables

Assets (sometimes called Fixed Assets in EBS)

• The Financial application that deals with Company Assets and how their value fluctuates over time.
• Can be linked to Payables when an organization orders goods that are tagged as an Asset.
• Assets can then be posted into the "Asset Book" and starts the Asset life cycle (Appreciation, Depreciation, Transfer, Adjustments, Retire, etc.).
• Run Create Accounting to Transfer to SubLedger Accounting (SLA)

Receivables (sometimes called Accounts Receivables or AR)

• The Financial application that creates and sends Invoices to Customers (can be created Manually or interfaced via AutoInvoice from Projects, third-party applications, etc.)
• Receipts are then issued once customers have paid the Invoices
• Run Create Accounting to Transfer to SubLedger Accounting (SLA)

Advanced Collections

• A subset application of receivables that deals with customer payment collection.
• Collectors can review delinquent, non-paying Customers and issue a reminder in the form of Dunning.
• Customers can then issue a Promise to Pay letter or raise a Dispute on payments.
• Every action a collector and customer is recorded in the application and can automatically raise flags/reminders when thresholds are not met.

Cash Management (usually abbreviated to CM)

• Reconcile Bank Statements to and from the Bank and link up to transactions within the application such as receipts
• Includes Miscellaneous Transactions such as Bank Interest and charges
• Cash Forecast and Positions
• Transactions such as External Transactions (Bank Charges or Interest Income) and Bank Account Transfers initiated from the Cash Management application goes into SubLedger Accounting

Tax (called E-Business Tax in EBS)

• Module responsible for the Calculation for Tax for both AR and AP
• Can be automatically linked to third-party tax providers such as Vertex
• Defines the Tax Regimes, Rates and Tax Recovery Rates, depending on the geographical area

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Overview of General Ledger in Oracle Fusion Applications

General Ledger 

Every ledger must have the "4Cs":

1. Chart of Accounts  (CoA) - helps organize accounting the data into segments
2. Calendar - the Calendar identifies the time frame of the transaction
3. Currency  - provides a financial measurement
4. Convention (or called Accounting Convention) - the statutory requirements of how we conduct our accounting (i.e. IFRS, US GAAP, etc.)

Chart of Accounts:

- Minimum of 2 Segments, Maximum of 30 Segments

Three types of Ledgers:

1. Primary Ledger
2. Secondary Ledger
3. Reporting Currency Ledger

You may have multiple Primary Ledgers for each each Legal Entity, depending on the country you're implementing for. A Secondary Ledger also shares all the data as the Primary Ledger, but may have a different accounting convention (i.e. US GAAP and IFRS).
A Reporting Currency Ledger shares all the data as the Ledger its attached to, but may have a different Currency (i.e. US to JPY). Note that one can have a separate Reporting Currency Ledger attached to a Primary and Secondary Ledger.

The Accounting Calendar defines

You may know more about Opening and Closing Accounting Periods on the Article "Overview of General Ledger Periods Cycle".

A quick checklist on the whole General Ledger process is shown in the Article: "General Ledger Accounting Cycle".

Transferring data from Subledgers to the General Ledger:

1. Balances Level - Lowest Level of Detail
2. Journal Level - Moderate Level of Detail
3. Subledger Level - Highest Level of Detail