How To Diagnose Inventory Accruals and Accrual Write Off Issues
How To Diagnose Inventory Accruals and Accrual Write Off Issues
How To Diagnose Inventory Accruals and Accrual Write Off Issues
How To Diagnose Inventory Accruals And Accrual Write Off Issues (Doc ID 866733.1)
In this Document
Purpose
Troubleshooting Steps
Release 11i Write Off Process
Release 12 Write Off Process
R12 Process Flow By PO Example
Table Level Contrast R11i And R12
Accounts Requirement For Write Off
Processing Overview
Data And Queries
Still Have Questions?
References
APPLIES TO:
PURPOSE
Accrual Write Off process identifies and writes off items that misstates the accrual balance on the Accrual Reconciliation Reports. Such
transactions will also include non accrual transactions wrongly debited or credited to the Inventory AP Accrual Account. The following are
potential transaction candidates to be written off : Differences between receipts and invoices with no intention of future invoicing,
Discrepancies in supplier billing, A/P No PO Transactions - Invoices not matched to PO or incorrect data conversion invoices, A/P No
Match-Valid Invoice with no corresponding receipt, Invoices Matched to Wrong PO or Receipt, Miscellaneous inventory or work in process
transactions that do not belong to Accrual Accounts, Payable Entries for Sales Tax and freight that do not belong to Accrual Accounts.
The Write Off process is different from R12 and R11i. We will cover both and highlight the differences. In R12 Accrual Write Off excludes the
write off transaction from the AP and PO Report and dynamically post to GL and excluded from the Net Accrual balance. Therefore the risks
and problems associated with Manual Journals are avoided
For relevant Notes relating to Inventory Accrual Reconciliation process please refer to
the following Notes:
Note.1107953.1 - R12 Accrual Balance Mismatch Between Accrual Reconciliation Report - Troubleshooting
Note 728871.1 - R12 How To Diagnose And Reconcile Inventory AP Accrual Transactions Using Reconciliation Reports
Note 824388.1 - R12 Account Requirements For Inventory Accrual Reconciliation
TROUBLESHOOTING STEPS
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1) Run the Accrual Rebuild Reconciliation Report Or the Rebuild Manager if Available and make sure the Date range includes the transactions
to be written off
4) Select the source as PO or A/P OR AP and PO if both should be written off or any other source you intend to write Off
Please refer to Note:728871.1 under 'New Art' for detailed, dynamic and automated examples of R12 Write Offs.
In R12 Accrual Write Off not only excludes the write off transaction from the AP and PO Report but also dynamically post to GL and excluded
from the Net Accrual balance. Therefore the risks and problems associated with Manual Journals are avoided
Before write off can be done in R12 data must first exist in CST_AP_PO_RECONCILIATION table.
Both the AP and PO Accrual Reconciliation Report and Accrual Write Off Form query their transactions from this Table.
The following steps should be followed before querying transactions from the Write Off Form:
2) Run the Create Accounting Program in Final Mode with subsequent Transfer of Entries to GL
3) Run the Accrual Reconciliation Load Program which will populate two Tables:
CST_RECONCILIATION_SUMMARY and
CST_AP_PO_RECONCILIATION
This will delete the accrual entry from CST_AP_PO_RECONCILIATION table and populate the write off transaction in CST_WRITE_OFFS
table. This write off transaction can also be viewed in the form View Write offs. In order to create accounting entries for the write offs in SLA
and GL for submit the Create Accounting program after completing the write offs in the Accrual Write Off Form. The Write Off Transactions
can be viewed in SLA menu by navigating to Tools > View Accounting in the View Write offs form.
Let us use PO #60116 to demonstrate the Write Off Process in R12 discussed above
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Po_Distribution_ID 200577
Accrual_Account_ID 163682
Po_Balance -150
Ap_Balance 125
Write_Off_Balance 0
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Invoice_Distribution_ID 1401618
Write_Off_ID
Ae_Line_Num 1 1 1
Quantity -5 -1 5
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AP PO Accrual transaction form – User can decide to write-off the accrual balance of that PO
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Once submitted all data of that PO distribution ID will deleted from CST_AP_PO_RECONCILIATION and SUMMARY tables
Write off form – A write transaction will be generated in CST_WRITE_OFFS table associated with that Po_Distribution_ID
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Write_Off_ID 3
Offset_Account_ID 163681
Accrual_Account_ID 163682
Write_Off_Amount 25
Po_Distribution_ID 2005
Write_Off_ID 3 3 3
Inv_Distribution_ID 1401618
Quantity -5 -1 5
Ae_Line_Num 1 1 1
In R12 write off transactions are posted from Costing to GL using XLA
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Below we will contrast in more details the write offs in R11i and R12
Let us assume we have two PO's PO#1 and PO#2
Let us assume further that for every transaction we have 1 Line and I distribution.
Period #1 Jan 2009 (For easy analysis let us presume for each PO)
PO Price $10
Quantity Ordered 10 in 1/1/2009
Quantity Received 5 in 1/1/2009
Quantity Invoiced 5 for PO#1 on 1/31/2009
Quantity Invoiced 4 for PO#2 on 1/31/2009
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R11i
When the Accrual Rebuild/or Rebuild Manager is run on 1/31/2009 after invoicing the following data will be retrieved to
AP_ACCRUAL_RECONCILE_TEMPS_ALL
accrual_account po_num po_distribution_id txn_date txn_source receipt_num invoice_num qty amount write_off_flag
Note:
PO#1 is self balanced (i.e. fully invoiced) but still loaded to the PO_ACCRUAL_RECONCILE_TEMPS_ALL
PO#2 has a balance of 10.
accrual_account po_num po_distribution_id txn_date txn_source receipt_num invoice_num qty amount write_off_flag
Customers can use the write_off checkbox to write off balance. They could also do mass write-off based on the tolerance. Assuming they
choose to write off the balance for PO#2, the write-off will immediately make PO#2 balanced. PO#2 and its details will disappear from the
reconciliation tables. Dynamic reconciliation. The write-off txn and its details will be generated. The automated accounting is done against
the write-off txn. The data in write-off tables is persistent. There is a track record, audit-able.
Write-off summary
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Write-off details
Suppose a mistake is made in the write-off, use the reverse checkbox to reverse it. The reversal txn will have its own accounting and
transaction details. It also points to its original write-off txn. Auditable again.
Write-off summary
W#2 ACCT#1 PO#2 D#2 1/31/2009 W#1 write_off -10 made a mista
reversal
Write_off details
As soon as the reversal is done, the PO#2 becomes unbalanced again and it comes back to the reconciliation tables. Dynamic reconciliation
again.
Both write-off and its reversal contribute to the total balance of a PO distribution.
Reconciliation summary
Reconciliation details
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When new txns for both PO#1 and PO#2 come in Feb, the new data actually makes PO#2 balanced, so it comes off the reconciliation
tables. However, the new data for PO#1 makes it unbalanced for the first time, so we will load all its txns.
Reconciliation summary
Reconciliation details
The data in write-off tables remain. So at the end of second period, we have data in reconciliation tables for PO#1 that need to be taken
care of. We also have data in write-off tables for PO#2 for legal and auditing purpose.
For normal business, over the time most POs should be self-balanced and write-off would be needed only for a small portion of problematic
POs. Therefore, we will have lean reconciliation tables and manageable size of write-off tables.
The following Accounts set up is required for all Accrual Accounts to be used in the Reconciliation Reports and Write Off.
Setup: Declare the accrual accounts to be used in Load Program and accrual write off
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Processing Overview
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Transactional:
Accrual load inserts accrual accounting journals in
CST_RECONCILIATION_BUILD: track of “Accrual Build”
CST_RECONCILIATION_SUMMARY: accrual data are summarized based on PO_DISTRIBUTION_ID only for AP PO reconciliation
CST_AP_PO_RECONCILIATION: AP and PO accrual journals
CST_MISC_RECONCILIATION: INV miscellaneous and AP miscellaneous date
CST_WRITE_OFFS and CST_WRITE_OFF_DETAILS: Store write-off transaction information
CST_RECONCILIATION_BUILD
The Columns
Operating_unit_id
From_date
To_date
Build_id
The first run of the accrual load program, will check the minimum XLA upgrade date and use that as the starting point no matter what start
date user is entering
CST_RECONCILIATION_SUMMARY
CST_RECONCILIATION_SUMMARY will capture the summary information for AP PO accrual journal entries.
The Columns
Po_Distribution_ID
Accrual_Account_ID
Po_Balance
Ap_Balance
Write_Off_Balance
Operating_Unit_ID
The table is the parent of the table CST_AP_PO_RECONCILIATION, it capture summarize balance information from different buckets
Those data can be rebuilt based on accrual date range
CST_AP_PO_RECONCILIATION
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CST_AP_PO_RECONCILIATION will capture the detail information for AP PO accrual journal entries.
The Columns
Po_Distribution_ID
Rcv_Transaction_ID
Inv_Distribution_ID
Write_Off_ID
Amount
Entered_Amount
Quantity
Operating_Unit_ID
Inventory_Organization_ID
Ae_Header_ID
The table is the child of the table CST_RECONCILIATION_SUMMARY, it captures AP or PO/RCV sub-ledger journal details per operational
transactions
Those data can rebuilt based on date range
CST_WRITE_OFFS
CST_WRITE_OFFS is the transactional table for Accrual Write-Off – Posting entity for accounting – Data are permanent
The Columns
Po_Distribution_ID
Write_off_ID
Accrual_Account_ID
Offset_Account_ID
Transaction_Type_Code
CST_WRITE_OFF_DETAILS
CST_WRITE_OFF_DETAILS is the detail table for CST_WRITE_OFFS – Data are permanent – Mostly used for data regeneration at write-off
reversal
The Columns
Write_off_ID
Rcv_Transaction_ID
Invoice_Distribution_ID
Transaction_Type_Code
Amount
Quantity
Ae_Header_ID
Ae_Line_Num
CST_WRITE_OFFS
CST_WRITE_OFFS is the transactional table for Accrual Write-Off – Posting entity for accounting – Data are permanent
The Columns
Po_Distribution_ID
Write_off_ID
Accrual_Account_ID
Offset_Account_ID
Transaction_Type_Code
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R11i
a)
b)
c)
R12
a)
b)
c)
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If data is retrieved from the above Tables then proceed to the Write Off Process
After completing the Write Offs above run the following sql to confirm the write offs:
Code Files
The following list of code files are vital in Write Off Transactions in R12
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REFERENCES
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