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Oracle Fusion Applications – An Approach to Rationalize Intercompany Transaction Types (AGIS) in Oracle Fusion Application

Rationalization and optimization of rules to achieve operational efficiency of Oracle Fusion Application

Client background

Global healthcare leader providing clinical, commercial, communication, and packaging services

Challenges

  • To handle inter-organizational transactions to record, track, reconcile and finally eliminate transactions for external reporting.
  • Bring operational efficiencies by leveraging Oracle Fusion Applications and it’s ‘Intercompany Accounting’ of Financial Common Module.
  • Optimize Intercompany Company Transaction Types
  • Reduce Ledger based balancing rules.
  • Introduce CoA based balancing rules.

Solutions

  • Analyzed the existing IC Account Framework.
  • Designed an efficient model for the Company that had a Global CoA, ~32 Primary Ledgers and ~121 Legal Entities.
  • Proposed solution was carefully designed to be generic and have a robust capability of addressing multiple entities as a part of IC Accounting.
  • Suggested to define each IC transaction type, wherever required to ensure ease of tracking on a 1 to 1 basis.
  • Assuming usage of global chart accounts, balancing rules were proposed to be optimized efficiently. Even otherwise, definition of balancing rules at CoA level will be more concise.
  • Recommended to desist from defining balancing rules at these levels. Use only for minimum ‘Exceptions’ as one off!

Tools & Technologies

Standard AGIS functionality in Oracle Fusion Application

Key benefits

  • If using global CoA – rules can be designed to cover each IC transaction type(s) and others to address ‘Catch All’ scenarios.
  • Reduced transactional errors when used with very limited IC transaction types.
  • Quicker IC reconciliations.
  • New IC transaction flows only requires configuration of IC transaction type and CoA balancing rules.
  • New users will be able to learn, assimilate and execute the IC transaction flows very quickly.
Vijay Anand