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Legal Entity & Set of books [message #195253] Wed, 27 September 2006 11:16 Go to next message
nivasgalla
Messages: 26
Registered: September 2006
Location: Hyderabad
Junior Member
Dear Friends,

I have a doubt in Legal Entity. Generally we attache SET OF BOOKS to legal entity. In the set of books we have a COMPANY SEGMENT column. Is there any relation between company segment and Legal Entity? (Somebody told both are same).

Suppose the Business Group has 5 legal entities. Can I create 5 values in Company Segment? If all the legal entities are different Char of accounts & different currencies. Then how can it works with single set of books? or we create multiple set of books according to the legal entities but the values in COMPANY SEGMENT are same? is it correct?

thanks

Srinivas

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Re: Legal Entity & Set of books [message #195379 is a reply to message #195253] Thu, 28 September 2006 05:43 Go to previous messageGo to next message
David.K.Dickson
Messages: 413
Registered: October 2005
Location: Surrey, England
Senior Member
I don't want to get into a debate on this. However, you might want to open the "Multiple Organizations in Oracle Applications" manual and search for "Legal Entity". It should give you a greater understanding of what Oracle means by "Legal Entity".

To start you off, here is their definition of a "Legal Entity":

"A legal company for which you prepare fiscal or tax reports. You assign tax identifiers and other legal entity information to this type of organization."

"Note: There are currently only a few features provided for legal entities, such as intrastat movement reports and intercompany invoice generation."

Here is their definition of a "Balancing Entity":

"Represents an accounting entity for which you prepare financial statements. This is a segment in the Accounting Flexfield structure (usually the Company segment) at which all accounting entries must balance. There may be multiple companies within the same structure, and each of these must balance within itself. Each legal entity can have one or more balancing entities. You can use Flexfield Value Security rules to restrict data entry of balancing segment values by legal entity or operating unit."

Cool HTH

David.

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Re: Legal Entity & Set of books [message #196811 is a reply to message #195253] Sat, 07 October 2006 13:49 Go to previous messageGo to next message
dineshk
Messages: 6
Registered: October 2006
Location: Bang
Junior Member
Hi,

The idea way is to create to 5 legal enties baecause currencies and other thigs do differ as said. You cant cater evrything with one legal entity.

Thanks and Regards,
Dinesh.

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Re: Legal Entity & Set of books [message #284919 is a reply to message #195253] Sun, 02 December 2007 21:42 Go to previous messageGo to next message
dhaimes
Messages: 19
Registered: November 2007
Location: San Francisco
Junior Member
In 11i the definition of Legal Entity is not strong - so the LE you assign to a set of books may indeed be a 'dummy' LE and the real LE are represented by the balancing segments - this is the typical US set up.

For other countries the set up tends to be 1 LE per set of books and 1 OU per set of books.

In R12, there is a much stronger LE definition and it can be mapped to Balancing segments or to a set of books.

For more information and a detailed example take a look at my blog post.

http://davidhaimes.wordpress.com/2007/11/21/how-do-i-define-my-legal-entities/

There's more about LE in the blog too

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Re: Legal Entity & Set of books [message #289276 is a reply to message #195253] Thu, 20 December 2007 08:53 Go to previous messageGo to next message
thinktank
Messages: 5
Registered: December 2007
Junior Member
I have the same doubt as the first question in this thread.

do we create 5 LE,1 ou under each LE. then how will the company segment of each book be ?

1. will have only 1 value ie the code of that ou only.

2. put the values for the other companies also in the company segment for set of book ?

Thanks

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Re: Legal Entity & Set of books [message #289335 is a reply to message #289276] Thu, 20 December 2007 14:52 Go to previous messageGo to next message
dhaimes
Messages: 19
Registered: November 2007
Location: San Francisco
Junior Member
It is up to you what you create.

You might create 5 LE, 5 company code(balancing segment values, BSV) all in one ledger and one OU. Or you may decide to have more than one ledger or more than one OU if that is what you require. You may want different OU for security or process grouping reasons and you may want multiple Ledgers if you have requirements fo rdifferent accounting methods, currency etc across the 5 LE.

Check this posts out for some discussion on that

http://davidhaimes.wordpress.com/2007/12/11/can-i-assign-an-operating-unit-to-2-legal-entities/

And this post describes how you can have different models for LE-OU-Ledger structures

http://davidhaimes.wordpress.com/2007/11/21/how-do-i-define-my-legal-entities/

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Re: Legal Entity & Set of books [message #293934 is a reply to message #284919] Tue, 15 January 2008 13:19 Go to previous messageGo to next message
finndoherty
Messages: 1
Registered: January 2008
Junior Member
Hi I have a question on the comment 'In 11i the definition of legal entity is not strong - so the LE you assign to a set of books may indeed be a 'dummy' LE and the real LE are represented by the balancing segments - this is the typical US set up.' - If I have five companies but I want to represent them as 1 SOB - 1 LE 1 OU - each company being represented by the balancing segments - is there any other work involved in implementing this dummy LE ( balancing segemnt LE ) structure. - Do you just not record the VAT reg number ?. I am concerned with Financial Reporting / VAT Reporting requirements.


Thanks

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Re: Legal Entity & Set of books [message #293965 is a reply to message #293934] Tue, 15 January 2008 15:32 Go to previous messageGo to next message
dhaimes
Messages: 19
Registered: November 2007
Location: San Francisco
Junior Member
So are these five companies outside of the US? (I assume as you mention VAT they are in Europe?)

If they are and you want to use the VAT reporting provided by development you should give each LE it's own OU and it's own sob, otherwise you are right you will have problems with some of the reporting.

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Re: Legal Entity & Set of books [message #303772 is a reply to message #195253] Sun, 02 March 2008 14:51 Go to previous messageGo to next message
Diyaaa
Messages: 2
Registered: February 2008
Location: USA
Junior Member
I need to add a field to a report.
filed is the "Legal Entity where transaction should be coded for Tax purposes for the partiular Invoice."..
That is the exact words of the user. now where can i find it? i need to pull this field for every trx_number.
how i joined is
select hop.LEGAL_ENTITY_NAME
from ra_customer_trx_all ct
,hr_operating_units hpu
,HRFV_OPERATING_UNITS hop
where hpu.organization_id = ct.org_id
and hpu.LEGAL_ENTITY_ID = hop.LEGAL_ENTITY_ID

bt i dnt kno wther its rt in terms of TAX purpose..

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Re: Legal Entity & Set of books [message #303787 is a reply to message #303772] Sun, 02 March 2008 19:39 Go to previous message
dhaimes
Messages: 19
Registered: November 2007
Location: San Francisco
Junior Member
If you are in R12 you should look for the Legal Entity ID column which is on ra_customer)trx table as each AR transaction should be stamped with an LE and eTax will use that LE to calculate tax - si to exactly meets your requirement.

David
blog: http://davidhaimes.wordpress.com

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