Oracle Release 12 - Sub Ledger Accounting

The new Global Architecture with R12 introduced the concept of ledgers each capable of providing differing accounting representations; one ledger for example could conform to IFRS, another to local GAAP.One of the key components is the new sub-ledger functionality.

This generates the actual accounting entries for each ledger dependant upon defined rules. In some respects this is similar to the dual posting in the Global Accounting Engine (AX).

In the above example, a single invoice generates the accounting for the Global COA, and the French statutory COA. The new terminology identifies a Transaction COA and an Accounting COA.
The mechanism to provide this functionality is the Accounting Methods Builder (AMB).

The AMB can derive accounts for individual segments or for the full code combination based upon the rules. This looks to continue the account generator /auto-accounting type functionality which has been used in various applications over the years.

Differing charts of accounts is only one feature of the sub-ledger engine; derivation rules at different levels from journal line to application can be specified, GL summarisation (summary / detail), reversal methods, and reporting sequences are other components. The AMB therefore provides the mechanism to build the rules that may apply for global management accounting, deriving accounting for corporate financial reporting, and individual country tax rules. This looks to be a powerful tool extending beyond the Alternative Accounting Representation functionality currently available in 11.5.7+, replacing the Global Accounting Engine (AX), as well as replacing many of the GL globalisation reports particularly within Europe.
Given the scale and complexity of the Oracle e-Business suite, the Accounting methods Builder looks as if it may become one of the key focus areas of the future.