David Haimes

A session I hope to attend at Open World is the one by Nayyar about Oracle’s internal upgrade to R12.

Session ID: S299147 Session Title: Lessons Learned in Upgrading to Oracle E-Business Suite Financials Release 12: Oracle’s Internal Upgrade Session Abstract: Want to hear about Oracle’s Global Single Instance upgrade to Release 12? Want to find out about specific lessons learned from the project team? Come to this session to get a detailed look at Oracle’s own upgrade to Oracle E-Business Suite Financials Release 12. Track: APPLICATIONS, Oracle E-Business Suite Focus Areas: Not Applicable Session Type: Conference Session Product Area: Financial Management Duration: 60 minutes

Room: Rm 2006 Speaker(s)/Company: Nayyar Siddiqui, Oracle

I spent some time working with Nayyar and his team earlier this year and it was a good experience, at times it was very tough but it’s been very valuable. Oracle has a lot of Intercompany transactions and does use AGIS, so they give the product a decent work out.  I also represented GL and as I have taken over GL more recently this was a really good chance for me to learn more about how a large GL customer operates and the things that are important to them.  I was motivated to help them out when needed not least because they literally pay my wages.

Written by David Haimes

This is from an email sent to me by Amazon

==============================================

The following items have been shipped to you by Amazon.com:
---------------------------------------------------------------------
Qty      Item                           Price  Shipped  Subtotal
---------------------------------------------------------------------
Amazon.com items (Sold by Amazon.com, LLC):
1     Seventh Generation Chlorin...   $42.99      1   $42.99

===================================================

It tells me the Legal Entity that I have a contract with, if those Diapers don’t arrive as advertised I know it is Amazon.com, LLC that I need to drag through the Legal System, it will also tell me something about what taxes they are going to apply if I look up where that Legal Entity is registered.

In this transaction I am the first Party and Amazon is the third Party. If I used an ERP system I’d be entering this transaction into my Payables system, David Haimes would be the first party LE and Amazon.com, LLC are the Supplier also known as the Third Party LE.

In Amazon’s ERP system, they used Receivables to generate the Invoice above and when they entered the Customer they entered David Haimes, he is the Third Party LE and they would also have Amazon.com, LLC as the First Party.

The interaction between myself and Oracle generates two transactions in two ERP systems and the same party is the First Party and the Third Party depending on where you are looking at it from. Still with me? It gets more confusing when we’re dealing with Intercompany (as usual) because we both of those transactions will be in the same ERP system, both the payables and the receivables transaction are present and the the same entity is a First Party LE (in Oracle defined in the Legal Entity Configurator) and a Third Party LE (defined as a Customer and Supplier).

So the only thing remaining is to work out who is the second party and why are they never involved, I have no idea on that one - if you do please let me know in the comments section.

The content catalog is available so you can go and search for sessions.

There’s an Intercompany session (S299151), it is not scheduled yet and as I am one of the presenters I can tell you it definitely isn’t written yet, next week I’ll get started on that with my copresenter from strategy, Helle.  the details of the session are below.  If you have any suggestions about what we should cover, how we might cover it or anything else for the session it would be great to hear from you - add them to the comments and let’s see if we can try and tailor the presentation to the audience a little.

Session ID: S299151 Session Title: Are Intercompany Processing and Reconciliation Currently a Pain Point for Your Enterprise? Session Abstract: Having problems reconciling your intercompany activity? Would you like better documentation and visibility into your various intercompany activities? Are acquisitions or changing legal structures making intercompany processing more expensive and time-consuming? Attend this session, which discusses and demos capabilities of Oracle Advanced Global Intercompany System in Release 12 and implementation options such as using this application as a standalone hub for all your intercompany activity across multiple ERP instances from multiple vendors. Track: APPLICATIONS, Oracle E-Business Suite Focus Areas: Not Applicable Session Type: Conference Session Product Area: Financial Management Duration: 60 minutes

Room: Rm 2006 Speaker(s)/Company: David Haimes, Oracle.; Helle Hennings, Oracle

If you read a lot of Oracle blogs you can’t have missed the news that you get to vote for some of the sessions at Oracle Open World this year on Oracle Mix. There’s a lot of great sessions suggested and although I’m about to plug my own I would encourage you to check out the other suggestions and vote often.

My suggestion is for a session inspired by the series I started on Why product development should blog, which only got as far as three part:

Why Product Development should Blog - How blogging will help your customers and YOU

A bold claim, but one I’m pretty confident I can back up. I’d also be interested in getting input form other bloggers within and without Oracle so I can share some of your wisdom in this session too. So add your comments and remember to go and vote.

by David Haimes (with excerpts from an internal document by Seamus Moran)

Regular readers will probably be used to this answer now… it depends.

In General Ledger 11i your functional currency referred to the currency of your set of books, it was one of your three Cs (Calendar, Currency and Chart of Accounts). In R12 we changed the terminlogy, there is no more set of books that is now renamed Ledger and the Currency of your Ledger is referred to as the Accounting Currency of the Ledger.

This is a subtle change and I’m sure experienced 11i practitioners are still using the term functional currency but you all need to stop because it’s confusing people.

In Financial standards (IAS 21 and FAS 52), Functional Currency is a test for the integration of your overseas and home businesses. If the businesses share a Functional currency, they are integrated, and you must use a financial statement conversion method called “remeasurement”. If the businesses do not share a Functional Currency, they are stand alone, and you must use a financial statement conversion method called “translation”. To determine the Functional currency, there are a series of cash flow related tests: it is an objective, situational determination, and not an optional choice.

Now just because your auditors tell you that your functional currency is Euro, this does not mean that you need to go about the tricky business of changing your Ledger Accounting Currency (or Set of Books functional currency) to Euro. What it means is that you need to remeasure in Euro rather than translate.

To do this re measurement you can use

1. The GL translation program
2. A secondary Ledger
3. A consolidation program such as Hyperion

It is not standard to have your Ledger Accounting currency different to you local currency, you will need to file local statutory reports in local currency, your bank will likely send you statements in local currency etc. so you really need your ledger operating in local currency to handle these easily.

So remember my Ledger Accounting Currency does not have to equal my functional currency.

I noticed today on Stephen Chan’s blog that this White Paper is available on metalink

Best Practices for Adopting Oracle E-Business Suite, Release 12 (Metalink Note 580299.1)

I haven’t reviewed the document yet, despite there being a section on AGIS. As soon as I resolve the problem I’m having with my metalink login I will take a look. I understand it was pulled together by Anne Carlson, who I know reads this blog becasue she mailed me just today with a question about it, I’m hoping some of the useful posts from this blog made the cut.

I want to use this opportunity to plug two other guides that are new in R12 and I highly recommend you read if you are looking at upgrading to R12.

Oracle Financials Concepts Guide, Release 12 (Part No. B28873-01 Oracle Financials and Oracle Procurement Functional Upgrade Guide: Release 11i to Release 12 (Part No. B31543-01)

I discuss them a little more along with a few other resources in this post.

UPDATE (June 16th):

I reviewed the White Paper and the AGIS section is fairly sparse - I will be contacting the author to try and get more detail in there.

However on the whole I think it’s a great document and essential reading for anyone looking to implement  or upgrade to R12.  Now if we can just publish that information on a blog, then we’ll truly have a living document, I’ll ask that question of the document owners.

I’m blogging in the style of twitter, for those of you in withdrawal due to it’s recent availability issues. Got to stick to 140 char limit

Confused by the title of this post? It refers to a headline in ‘The Sun’ (UK ‘Newspaper’) that is so famous in the UK it’s a popular phrase

Twitter is a free service. No advertising, no fees, no hidden charges, no taxes, no problem. It is used by free loaders like me (and you?)

@Twitter was down a bit over this weekend, it has disabled some features and limited usage levels on others while it sorts out it’s problems

@TechCrunch did a one word blog post during the downtime ‘Twitter!’ got over 400 comments. Clearly people feel passionately about Twitter.

@mkrigsman blogged about twitter downtimes calling it IT mgmt failure saying ‘many people depend’ on it @dhaimes responded ‘more fool them!’

@twitter should not be burning cash building a bullet proof technical infrastructure to support millions of free loaders, it needs to make $

Bullet Proof infrastructure anyone can do, just hire the experienced people and buy a lot of hardware and software, easy, but it will cost $

The dot-com dead pool is full of wonderful scalable infrastructures, costing a lot of money which owners did not figure out how to pay for.

I used to use, Webvan which built a great infrastructure, had some great technology and spent $1 Billion. It never made a cent and went bust

If ‘many people depend’ on @twitter, would they all pay to use it? If they guaranteed 99.9999% availability how much would you pay for it?

Did you notice every paragraph is exactly the 140 characters long? One great thing about twitter is it forces people to be much less verbose

I recently had a question about what Balancing Segment Value (BSV) to enter in the accounts for the All Other All Other rule and I have to admit it could be a little confusing. There is a technical limitation with the flexfield infrastructure we use to capture and store accounts which means we have to have some value for BSV and Intercompany Segments, even though we will substitute in the real BSV when we generate the Intercompany accounting.

Here is an example (chart of accounts is balancing-natural account-intercompany)

I define the following rule

Debit BSV Credit BSV
Debit Account Credit Account All Other All Other 99-4000-99 99-2000-99

Then I enter a journal

Account Debit Credit Line

13-1000-00 100.00 Original Line

03-6000-00 100.00 Original Line

When I post this, the balancing lines generated are

Account Debit Credit Line

03-4000-13 100.00 Balancing Line

13-2000-03 100.00 Balancing Line

So you can see we discard the BSV and Intercompany segment from the set up and use the correct ones from the transactions. If we always reatined 99, we would be using 99 as a clearing company for everything, if you wanted to do that you would use the clearing company options.

When I looked out of my office window this morning I noticed somebody had a left a great big yacht outside 500 building. It is still there, nobody towed it and I didn’t see any parking tickets on it, so I assume Larry parked it there. I wonder if it’s his new ride to work; anyone can show up in a Porsche 911, Ferrari Testarossa or Toyota Sienna but if you really want to turn heads park your 62 foot Americas Cup yacht outside the office.

I was curious to check it out so I did my lap of the lake. If you have ever been to Oracle HQ you will have observed this phenomenon, we all like to walk around the lake after our lunch and this week there has been a bit of a crowd near the Yacht, I was one of the sad characters taking photos.

Thanks to Oracle nerd for this post, referencing an article on CIO magazine. Apparantly connected employees are more productive. I thought this was a no brainer, if I know a lot of people I can get help and advice from a lot of people, equally if I know a lot of stuff people want to stay connected to me so they can pick my brains and get their job done.

The article goes into more depth and backs it’s argument up with stats, research and references, but I’m a blogger not a journalist. I think the paragraph above is obvious so I state it as my opinion and I’m done. For more detail on my ideas around what I call dev 2.0 you can read my original post, if you want to see it in action - you need to come and join my team, or maybe offer me a job (Boss - if you’re reading, this is a joke).

I try to be clever and/or funny by putting a cryptic title for my posts, I think it’s my attempt to make Financial Software sound fun, perky and exciting (which it is of course). Probably the real result is for some people to get here from google (or Yahoo - do they still do search?) and be very disappointed, in fact they are probably hitting the back button right now. WordPress can show me what searches people did that got them to my page and without going into the details let me tell you that my posts about the Intercompany Periods feature (why do I need another Period?) and my musings about clearing my desk to move office (Cleaning out my Closet?) have probably been read by many confused young people and I apologize to them if they are now here reading this too. Right now those of you who know this is a blog about Oracle Financials are probably wondering when they can stop skimming the preamble and I might get to something of use or interest, so without further ado…

I was working with some AGIS users creating an Intercompany transaction from the entry screen when somebody asked “What does that radio button do?” I realized nobody in the room fully understood the feature. Automatic distribution mode is essentially an aid to ease the amount of data entry you have to make. If you’re creating a transaction batch with multiple transactions (ie. multiple recipients) you’ll have a set of initiator (that will be you as you are entering the batch) accounting distributions for each of the transactions in the batch. Now if I have a batch with dozens or hundreds of transactions in and I want each of those transactions distributed to the same accounts, entering them manually against each transaction will take some time. So if I select automatic distribution mode you just enter your initiator distributions once and the batch header level and when you submit we will prorate those down to all teh transactions in the batch. So you can save a lot of key strokes entering transactions.

Financial Services Accounting Hub or FSAH (pronounced F-saa apparently) is a great product and is not only for Financial Services companies either, I understand we’ll sell it to anyone.

From a (very) high level perspective it allows you to use Oracle SLA and GL to perform the accounting for third party applications. Companies the Financial services industry tend to build a lot of highly complex applications (e.g. loan systems, trading systems) in house, but they want the final accounting of transactions form these disparate system to end up in the same place and it will be nice if they can re-use the same accounting rules too. Hence the concept of an accounting hub.

If you are using FSAH on R12, you can also utilize all the new AGIS features introduced in R12 and that could help you to apply common intercompany processing rules across your entire business too.

I have had a few discussions with customers asking if AGIS could be used as a hub for all intercompany trading across many ERP systems and the answer is very much so, that is something that we had in mind when building the product. You should be able to push transactions from multiple Oracle instances, even on different versions and throw in an SAP or Peoplesoft instance too if you want. There will be some integration work, but we use standard interfaces, services, API and also make use of the Workflow Business Event system to make this process as easy as possible.

What is the difference between Tax Avoidance, Planning, Mitigation and Evasion? The first three of these are legal and the last one isn’t. With the recent conviction of Wesley Snipes, tax has been in the news quite a lot and over in the UK there has been some interesting stuff written about the country’s largest retailer, Tesco and it’s tax situation. The guardian newspaper responded today to a writ issued by Tesco, over an article in the guardian back in February.  The article talks about how Tesco has been moving assets to different companies in a variety of jurisdictions.

Global corporations have complex legal structures and whenever any assest or liability moves to a different Legal Entity, that is Intercompany and there may be tax involved. The complex and ever changing laws in this area mean it is increasingly important that you have tight control on your intercompany and it is documented because auditors and tax authorities may need to take a close look.

I had dinner with the Appslab crew last night, they’ve been at the Web 2.0 Expo doing their thing; I expect Jake will blog about th conference soon. I enjoyed listening to their ideas and figuring out how they fit into not only our products but our development process. I’ve been thinking a lot recently about how web 2.0 concepts fit into my daily work in product development and have come up with the phrase “Product Development 2.0″.

So what is Dev 2.0? Dion Hinchcliffe talks about it as business reaching out to customers over the web and letting them influence the direction of products. An example he uses is XM radio station playing records voted for by it’s users over the web or by sending in text messages. I think customer input is important and tools like this blog and Oracle Mix are great ways to engage customers, but my vision of development 2.0 has a totally different angle, I am looking at the daily life of a software developer or product manger in a large software shop and how we can add web 2.0 into the mix

Oracle has thousands of employees in product development and communication is always a huge issue in an organization of that size. We need to make maximum use of the latest tools to ensure the hard work put in by a person in the org to figure out the best way to do something doesn’t go to waste and that knowledge is available to people who need it. Traditionally we rely a lot on informal networks, for example if I need info on BI Publisher, I call Tim, I used to work with him and know him. I have 10 years worth of contacts like that, dozens of favors I owe and am owed, friends of friends people I know from the gym, car pool partners, snowboarding friends etc etc. This is the ‘phone a friend’ model, when I am stuck I call a person who will know an answer and who will take my call (This reminds me of a trick I use when people are not taking my calls - dial an outside line and then call their number so the caller ID does not show as you, they pick up and get a shock when they hear your voice). The problem with this model is it just doesn’t scale, I need a way to let other’s tap into the knowledge networks and web 2.0 is all about connecting people, to each other and to information.

Example of Development 2.0 in action are blogging by subject matter experts, social networks inside the firewall, user docs and standards guides on wikis, annotation tools to comment on others work, digg like sites where you can vote on the most useful information, the list goes on. This is something sagar talked with passion about when he was at Oracle and I think in Apps development many people really get it and the the word is spreading.

However Product Development 2.0 should not just be about technology that enables communication on a scale never possible before, it has to be about changing the attitudes and mindsets of people. We need to be committed to sharing what we know making it part of our daily job to add to the common knowledge base of organization. There is probably a full post on that in my head, but ironically I don’t have the energy to share my ideas and knowledge on that right now (it’s after midnight and I’ve been up since 7am).

So what does product development 2.0 mean to you? Do you see it on your organization? If you are in development at Oracle, do you agree with my opinion that things are changing? Share your wisdom in the comments.