Atlanta: Presentation To OAUG - SIG
Atlanta: Presentation To OAUG - SIG
Atlanta: Presentation To OAUG - SIG
Atlanta
21-Oct-2005
Inter – Company Transactions
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Agenda
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Inter-company Transactions
Movement of Goods :
Between Divisions belonging to Same Legal Entity
Across more than one Legal Entities within US
Across Many International Subsidiaries
Single face to Customer (One Selling Company – Multiple Internal Supply Companies)
Selling Company Books Order & Raises Bills on Customer
Supply Company drop-ship goods directly to Customer warehouse.
Intercompany Billing between Selling and Supply company.
Intercompany Journals
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Business Case
Single face to Customer
Single Selling Company – Multiple Supply
Companies
Multiple Selling Companies – Multiple Supply
Companies
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Why Single Face to Customer ?
1. What the
customer was Customer 2. Multiple businesses servicing a single customer
seeing order…time consuming internal negotiations
before…multiple
legal entities, no Customer
single interface
LE 1 LE 2 LE 3 LE 4 LE 5 LE 6
LE 1
3. Multiple
acquisitions…many LE-2 LE-3
faces to the customer.
ITO / Application LE-1 LE-4
confusion etc.
LE-3 LE-2
Customers
LE-6
LE-4
LE-5
HR Legal IT
Parent Company
Primary Objectives Finance Leadership
Single Face to
Customer
Compliant Legal Commercial Statutory Entity - CSE
Structure & (Selling Company – Customer facing)
Branding
Rationalize multiple
USA Benefit Plans
Re-align people to
operational owners
Single ITO Platform LE - 1 LE - 2 LE - 3 Future
Acquisitions
Product
(US / Non-US)
Product
Line Line
USD
Sales Order
Set of
Set of Books
Books
AR Invoice
Shipment
Legal
LE - US
Entity
IC-AR
Operating
Selling OU Supplying OU
Unit IC - AP
Sub-
Sub - Inv Sub - Inv Sub - Inv Sub - Inv
Inventories
…..
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Oracle Solution :
Multi – Org Structure & Transaction Flow (Intl. Outside US)
Consolidation Set of Books
(Financial Consolidation + I/C Elimination)
MRC
USD Non-USD
MRC USD
Set of Sales Order Set of Books Set of Set of
Books Books
Books
Legal LE - US LE –
Entity Non-US
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Oracle Solution : Process Flow Diagram
Supply Chain Model - Selling Company (Order Management)
CSE – Generate
Progress Run Import
Selling Create
Auto Bill Cycle
Create Inter- Inter-
Book Receiver from
OU Project
invoice company
Receiver Company
Order Import Project to
AP Invoice AP invoice
Customer Inter-
company
Invoice
Settlement
&
Run Custom Auto Elimination
HBSE – Ship Goods Create Inter- Program Invoice
Supplying to company updates the Import Inter-
OU Customer AR Invoice Inter-Co Inv company
Amount
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Oracle Solution : Process Flow Diagram
Manufacturing Model - Selling Company (Project Accounting)
Select One of the Fulfillment
Book Order
Org as Shipping Warehouse
on Sales Order
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Oracle Solution : Setup Details & Customization Details
Selling Company
Supply Chain Model Manufacturing
Module Involved : Modules Involved :
OM, AR, AP, INV ) (OM,PA, INV, AR, AP)
Define Intercompany Customer & Define Intercompany Customer & Supplier
Supplier Define Implementation option in PA (Internal
Billing)
Create Intercompany Relationship in
Define Billing extension. (Optional)
Inventory Module
Set up Automatic Billing (Optional).
Setup Auto-accounting Rule in AR
Setup Auto-accounting Rule in PA
Setup AR Transaction Type and link to Setup Auto-accounting Rule in AR
Order Transaction Type. Setup AR Transaction Type and link to Order
Create Custom Program to calculate Transaction Type.
Transfer price and update AR Auto Define and link Receiver project & Provider
invoice Interface table. project. (Required)
Create custom program in AP to handle one to
many Supplier relationship.
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Operational Structure – Process Flow &
Accounting
Order Booking CSE Books order from Customer
No Accounting Entries
Ship to Customer • HBSE business drop-ships parts to Dr. COGS (HBSE – LE)
Customer Warehouse. Cr. Inventory (HBSE-LE)
Invoice to Customer • CSE raises Invoices to Customer. Dr. External Receivables (CSE-LE)
Cr. External Revenue (CSE – LE)
Intercompany AR • HBSE raises an Inter-company AR invoice Dr. Due From CSE (HBSE – LE)
Invoice on CSE @ agreed Transfer Price. Cr. Internal Revenue (HBSE – LE)
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Contact Information
www.genpact.com
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Disclaimer
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