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Enterprise Structures Business Process Model6


In Oracle Fusion Applications, the Enterprise Performance and Planning Business Process Model (BPM) illustrates the major implementation tasks that you perform to create your enterprise structures. This process model includes the Set Up Enterprise Structures detailed business process, which consist of implementation activities that span many product families.
Information Technology is a second BPM which contains the Set Up Information Technology Management detailed business process. Define Reference Data Sharing is one of the activities in this detailed business process and is important in the implementation of the enterprise structures. This activity creates the mechanism to share reference data sets across multiple ledgers, business units, and warehouses, reducing the administrative burden and decreasing the time needed to implement.The important activities of BPM are:
1.1 Define Enterprise
Define the enterprise to capture the name of the deploying enterprise and the location of the headquarters. There is normally a single enterprise organization in a production environment. Multiple enterprises are defined when the system is used to administer multiple customer companies, or when you choose to set up additional enterprises for testing or development.
1.2 Define Enterprise Structures
Define enterprise structures to represent an organization with one or more legal entities under common control. Define internal and external organizations to represent each area of business within the enterprise.
2.1 Define Legal Jurisdictions and Authorities
Define information for governing bodies that operate within a jurisdiction.
2.2 Define Legal Entities
Define legal entities and legal reporting units for business activities handled by the Oracle Fusion Applications.
3.1 Define Business Units
Define business units of an enterprise to allow for flexible implementation, to provide a consistent entity for controlling and reporting on transactions, and to be an anchor for the sharing of sets of reference data across applications.
4.1 Define Financial Reporting Structures
Define financial reporting structures, including organization structures, charts of accounts, organizational hierarchies, calendars, currencies and rates, ledgers, and document sequences which are used in organizing the financial data of a company.
4.2 Define Chart of Accounts
Define chart of accounts including hierarchies and values to enable tracking of financial transactions and reporting at legal entity, cost center, account, and other segment levels.
Define Ledgers Define the primary accounting ledger and any secondary ledgers that provide an alternative accounting representation of the financial data.
4.3 Define Accounting Configurations
Define the accounting configuration that serves as a framework for how financial records are maintained for an organization.
5.1 Define Facilities
Define inventory, item, and cost organizations. Inventory organizations represent facilities that manufacture or store items. The item master organization holds a single definition of items that can be shared across many inventory organizations. Cost organizations group inventory organizations within a legal entity to establish the cost accounting policies.
5.2 Define Reference Data Sharing
Define how reference data in the applications is partitioned and shared.
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Enterprise Structures


The enterprise structure of Oracle Fusion Application is similar to the organization structure in Oracle EBS Release 12.
Every enterprise has three fundamental structures, legal, managerial, and functional, that are used to describe its operations and provide a basis for reporting. In Oracle Fusion, these structures are implemented using the chart of accounts and organizations. Although many alternative hierarchies can be implemented and used for reporting, you are likely to have one primary structure that organizes your business into divisions, business units, and departments aligned by your strategic objectives.
Legal Structure
The figure above shows a typical group of legal entities, operating various business and functional organizations. Your ability to buy and sell, own, and employ comes from your charter in the legal system.
A corporation is a distinct legal entity from its owners and managers. The corporation is owned by its shareholders, who may be individuals or other corporations. There are many other kinds of legal entities, such as sole proprietorships, partnerships, and government agencies.
A legally recognized entity can own and trade assets and employ people in the jurisdiction in which it is registered. When granted these privileges, legal entities are also assigned responsibilities to:
• Account for themselves to the public through statutory and external reporting
• Comply with legislation and regulations
• Pay income and transaction taxes
• Process value added tax (VAT) collection on behalf of the taxing authority
Many large enterprises isolate risk and optimize taxes by incorporating subsidiaries. They create legal entities to facilitate legal compliance, segregate operations, optimize taxes, complete contractual relationships, and isolate risk. Enterprises use legal entities to establish their enterprise’s identity under the laws of each country in which their enterprise operates.
In the figure above, a separate card represents a series of registered companies. Each company, including the public holding company, InFusion America, must be registered in the countries where they do business. Each company consists of various divisions created for purposes of management reporting. These are shown as vertical columns on each card. For example, a group might have a separate company for each business in the United States (US), but have their United Kingdom (UK) legal entity represent all businesses in that country. The divisions are linked across the cards so that a business can appear on some or all of the cards. For example, the air quality monitoring systems business might be operated by the US, UK, and France companies. The list of business divisions is on the Business Axis. Each company’s card is also horizontally striped by functional groups, such as the sales team and the finance team. This functional list is called the Functional Axis. The overall image suggests that information might, at a minimum, be tracked by company, business, division, and function in a group environment. In Oracle Fusion Applications, the legal structure is implemented using legal entities.
Example – ABC Corp. is a group of companies with products like Mobile Phone, TV and Refrigerator. The company operates in US, UK and India.
Legal Axis:
In US the legal entities are ABC Corp. MP, ABC Corp. TV and ABC Corp. Refrigerator.
But in India there is one legal entity ABC Inc.
Business Axis:
In India the business axis would be MP, TV and Refrigerator.
The managers/employees working in India in MP business area would co-ordinate with the ABC Corp. MP.
But in US this axis might not be of any significance
Management Structure
Successfully managing multiple businesses requires that you segregate them by their strategic objectives, and measure their results. Although related to your legal structure, the business organizational hierarchies do not need to be reflected directly in the legal structure of the enterprise. The management structure can include divisions, subdivisions, lines of business, strategic business units, and cost centers. In the figure above, the management structure is shown on the Business Axis. In Oracle Fusion Applications, the management structure is implemented using divisions and business units.
Functional Structure
Straddling the legal and business organizations is a functional organization structured around people and their competencies. For example, sales, manufacturing, and service teams are functional organizations. This functional structure is represented by the Functional Axis in the figure above. You reflect the efforts and expenses of your functional organizations directly on the income statement. Organizations must manage and report revenues, cost of sales, and functional expenses such as research and development (R&D) and selling, general, and administrative (SG&A) expenses. In Oracle Fusion Applications, the functional structure is implemented using departments and organizations, including sales, marketing, project, cost, and inventory organizations.
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Basics of Oracle Fusion Apps

As the name suggests it’s a fusion application from oracle which encloses the best feaures of the following oracle products :

•Oracle EBS
•Peoplesot
•JD Edwards
•Sybel CRM
And many more
OAF is designed from the ground-up using the latest technology advances, Oracle Fusion Applications are 100 percent open-standards-based business applications .
Like Other oracle products (Oracle EBS R12), OFA is also modular and is coming up with below applications :

  • Supply Chain Management
  • Procurement
  • Financials
  • Project Portfolio Management
  • Human Capital Management
  • Customer Relationship Management
  • Governance, Risk, and Compliance

For customers using Oracle E-Business Suite and Oracle’s PeopleSoft, JD Edwards, and Siebel CRM that are interested in better business performance, Oracle provides a complete choice in deployment options.

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R12 – Procure To Pay Cycle in Oracle Apps (P2P)

I tried to explain the steps involved in Procure to Pay Cycle. This is a pure functional Stuff and helps you to understand the navigation steps.
I tried to keep as simple as Possible for clear understanding. The screenshots given below are taken from R12.1.1 apps instance.
Stage 1: Choosing an Item
Let us choose an item to be procured in our example.
Go to Purchasing Responsibility and follow the below navigation to check for the suitable item.


The item picked for our example should be purchasable item as above. Click on tools and choose “Categories” to view the below screen.

Stage 2: Creation of Requisition
Follow the below Navigation to reach Requisition Form.

Create a new Requisition for the item viewed in Stage 1.

Click on Distributions to View the charge Account.

Save and Submit for Approval

Now note down the Requisition number and open the “Requisition Summary Form” to view the status of it. For our Example, Requisition number is: 14855

Stage 3 : Checking the Status of Requisition

Query for the Requisition Number and click Find.

Here for our example purpose, I kept the submitted and approved person has same and hence it shows the status as approved.

To see the approval status, please follow the below navigation.

Stage 4 : Creation of Purchase Order
For creating a Purchase order, let us use the “Autocreate Documents” Form. Follow the below Navigation


Query for the Requisition

Click on Automatic as shown in the above figure to create a Purchase Order

Click on “Create” button to create a Purchase order

View the shipment screen to change the “Match Approval Level” to “2-Way”.

Click the “Receiving Controls” to make sure that the “Routing” is made as “Direct Routing”

Click Save and submit for Approval.


Note down the PO Number.

Stage 5: Creation of Receipts


Query with the Purchase order created in the above stage.

Check the check box near to the lines that are received and click save.

Click the “Header Button” to view the Receipt Number.

Stage 6: Checking the On Hand
Go to any Inventory Responsibility and follow the below Navigation

Query for our Receipt and make sure the Organization is the same as we received.

Below screen will show that our inventory has been increased by 5 quantities.

Stage 7: Check the Material Transactions
Follow the below Navigation to reach “Material Transactions” Form


Query for the item and date as below


Below screen shows the source and transaction Type

Below screen shows you the Serial Numbers of the items received.

Stage 8: Creation of Invoice
Navigate to any Purchasing Responsibility and view à Requests
Submit the below requests by providing the Receipt number as Parameter to create an invoice.

Check the status of the program.

Stage 9: Checking the Invoice
Change to any Payables Responsibility and open the invoices Form.
Query for the Purchase order as below,


Click “Actions” Button then tick the “Validate Check Box” and press “Ok” to validate the invoice

Below screenshot will give you the status of the invoice

Stage 10: Creation of Accounting and Payment
Once invoice got approved, we can “Create Accounting” and “Create Payments” via “Action” Button in the “Invoice Form” as we validated the invoice.

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Overview of Procure to Pay Cycle in Oracle Apps

Procure to Pay Lifecycle is one of the important Process in Oracle Applications. Procure to Pay means Procuring Raw Materials required to manufacture the final or finished Goods from a Supplier to Paying the Supplier from whom the material was purchased. But this process is not just two steps. It involves many steps. Let’s see the steps and Oracle Application involved in performing those steps.

1.Creation Of Purchase Requisition
Requisition is nothing but a formal request to buy something. Requisitions represent the demand for any goods or services that an organization needs.

Requisitions for goods and services:

  • Are generated by applications including Inventory, Work in Process (WIP), Material Requirements Planning (MRP) and Order Management.
  • May be entered manually through Purchasing windows.
  • May be entered using iProcurement.
  • May be imported from external systems.

There are two types of Requisitions
1] Internal Requisition – Basically used when there is a Requirement from One Inventory Organization to the Other Inventory Organization (Inter- Organization Transfer)
2] Purchase Requisition – Basically used when there is a Requirement to be fulfilled by External Sources i.e. Suppliers, Requirement from MRP, Requirement from WIP, Requirement from Sales Order etc.
With Oracle Purchasing module, you can create, edit, and review requisition information on-line.  Then the Requisitions went for approvals from proper authorities.
2. Creation of Purchase Order
Based on the Purchase Requisition and its approval next we have to create a Purchase order to buy the item.

Purchasing supports four types of purchase orders:
1] Standard: Create standard purchase orders for one-time purchases of various items. You create standard purchase orders when you know the details of the goods or services you require, estimated costs, quantities, delivery schedules, and accounting distributions.
2] Blanket: Create blanket purchase agreements when you know the detail of the goods or services you plan to buy from a specific supplier in a period, but you do not yet know the detail of your delivery schedules.
3] Contract: Create contract purchase agreements with your suppliers to agree on specific terms and conditions without indicating the goods and services that you will be purchasing.
4] Planned: A planned purchase order is a long-term agreement committing to buy items or services from a single source. You must specify tentative delivery schedules and all details for goods or services that you want to buy, including charge account, quantities, and estimated cost.
Once purchase orders are created, they may be submitted for approval. The approval process checks to see if the submitter has sufficient authority to approve the purchase order.  Once the document is approved, it may be sent to your supplier using a variety of methods including: printed document, EDI, fax, e-mail, iSupplier Portal and XML. Once the purchase order or release is sent to your supplier, they are authorized to ship goods at the times and to the locations that have been agreed upon.
3. Receipt of Material
After receiving the PO, the supplier will send the items.

Purchasing lets you control the items you order through receiving, inspection, transfer, and internal delivery. You can use these features to control the quantity, quality, and internal delivery of the items you receive.
4. Creation of Payables Invoice
Once you’ve received goods or service from your supplier, you’ll also receive an invoice.  Using Payables you can record invoices in a number of different ways.

With Payables you can:

  • Import/Enter invoices manually, either individually or in batches.
  • Use Quick Invoices for rapid, high-volume entry of standard invoices and credit memos that are not complex and do not require extensive online validation.
  • Automate invoice creation for periodic invoices using the Recurring Invoice functionality.
  • Use iExpenses to enter employee expense reports using a web browser.
  • Import EDI invoices processed with the e-Commerce Gateway.
  • Import XML invoices.
  • Match invoices to purchase orders or receipts to ensure you only pay what you’re supposed to be paying for.

5. Payment to Supplier
Once invoices are validated, they can be paid. Payables integrates with Oracle Payments, the E-Business Suite payment engine, to handle every form of payment, including checks, manual payments, wire transfers, EDI payments, bank drafts, and electronic funds transfers.  Payables also integrates with Oracle Cash Management to support automatic or manual reconciliation of your payments with bank statements sent by the bank.
This is how the P2P Cycle occurs in Oracle Apps.

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