Oracle General Ledger Aricturture

1.      Ledger – Records all the Financials Information.

2.      The Chart of Accounts is the Heart of your Accounting

3.      Ledger is the Heart of your Organization Financials Structure

4.      Ledger Types in OGL

4.1              Primary Ledger (Mandatory)

4.2              Secondary Ledger (Optional)

4.3              Reporting Ledger (Optional)

5.      Primary Ledger – Original Ledger where all your business data are recorded and this is the ledger by default integrated with Other Modules. We need to have at least one Primary Ledger in our Instance to capture all our financial information and business data’s.

6.      Secondary Ledger – Optional Ledgers. The need of secondary ledger is mainly to implement the accounting process as per the GAAP, Generally Accepted Accounting Principles. There might be a variance on processing certain items while reporting to multiple authorities. Such as Taxation, Depreciation Methods, Revaluation of Assets, Inventory Stock Value, Accounting Principles such as classification of accounts based on Expenditure or Assets such as Capitalized Assets or Capitalized Expenditures.   The Purpose of Secondary ledger is if there is a change in Accounting Methods or Accounting Convention.

7.      Reporting Ledger – Optional ledger. Can be configured either to Primary Ledger or Secondary Ledger or Both. Reporting Ledger only if there is a change in Currency.

Ø  One Primary Ledger can have multiple Reporting Ledgers

Ø  One Secondary Ledger can have multiple Reporting Ledgers

Ledger Configuration

1.      Ledger Components (4 ‘Cs)

Ø  Chart of Accounts (COA) – Accounting Structure of an Organization. We can define our own COA, as per the flexibility of the organization to capture the business data’s visibility in the Account Codes, Consideration of Legal Prospective, Branches, Financials Reporting, Taxation Reporting, Multi Organization structures

Ø  Calendar – The Financials Year of the Organization, basically it should be considered as per the country standards.

Ø  Currency –Scales the Value of the Transactions. The currency is depends on the location of the organizations.

Ø  Accounting Convention – Optional – By default system will take Standard Accrual Basis. To records the business transactions as per the Accounting Principles. GAAP

2.      How many Ledger is required for an Organization

Ø  Depends on the Organization Structure of the Customers, Multiples Branches, Multiple Businesses (LOB), Multiple Legistrative.

Ø  If any of the 4’cs is different, from one business to another business or one location to another location, we might required multiple primary ledgers

Ø  Single Organization Operates in Single Country

Ø  Single Organization Operates in Multiple Countries

Ø  Multiple Organization operates in Single Country

Ø  Multiple Organization operates in Multiple Countries