Sub-Ledger Accounting

Sub-Ledger Accounting

Sub ledger accounting traditionally had accounting rules spread across multiple Products and Sub ledger applications hence it was Difficult to keep the rules up to date and manage.

And if there used to be any requirement which requires a different Accounting treatment as per different geographies, Regulations  or entity it was extremely difficult to implement and many times the ultimate solution was to implement a customization or pass manual Adjustment entries.

The New Sub Ledger accounting feature of oracle E-business Suite R12 popularly known as SLA addresses such issues through a central accounting rule engine allowing among other things, Superior controller ship of definition of accounting rules.

SLA is a rule based accounting Engine that introduced the ability to define how transactions originating in Sub Ledgers can be Accounted. One of the significant benefits of SLA is the ability to generate multiple accounting representations (IFRS and local GAAP) for a single sub ledger transaction.

Hence in Simple words, Different from 11i where accounting Entries used to get created in respective Sub ledgers and then get transferred to GL, In R12 the Entries get created using SLA for all the Sub ledger applications and then gets transferred to GL. Hence it would be appropriate to say SLA is placed between different Sub ledgers such as AP, AR, CE, PA and General Ledger as mentioned in below. 

Sub Ledger Accounting Gives capability to Massage/ Change the accounting entries which gets generated as part of the Standard Sub Ledger application specific account so as to have the accounting entries posted to the desired accounts to address various geographies or entity specific accounting requirement

Above Example shows how the accounting String (A.B.C.D) generated by SubLedger Applications (Eg: AP, AR, CE) can be altered to A1.B1.C1.D1 to achieve specific Accounting requirement and then can be transferred to general Ledger.