Oracle B16229-05 User Manual

Oracle® Financial Consolidation Hub

User's Guide
Release 11i

Part No. B16229-05

March 2007

Oracle Financial Consolidation Hub User's Guide, Release 11i

Part No. B16229-05

Copyright © 2005, 2007, Oracle. All rights reserved.

Primary Author:  Karen dela-Torre, David Deputy, Sagar Kamdar, Carol Ann Lapeyrouse, Jason Loy, Sanjay
Mall, Beini Zhou, Rob Zwiebach

Contributing Author:  Carolyn Luk

Contributor:  Samatha Kung

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Send Us Your Comments

Preface

1 About Oracle Financial Consolidation Hub



Contents

Oracle Financial Consolidation Hub Overview

....................................................................... 1-1

2 The Oracle Financial Consolidation Hub Solution

Quick Reference

........................................................................................................................ 2-1

3 Setting Up Oracle Financial Consolidation Hub

Oracle Financial Consolidation Hub Setup Overview

.............................................................3-1

4 Setting Up Users

Overview

................................................................................................................................... 4-1

5 Setting Up Oracle Enterprise Performance Foundation

Overview

Tasks

Using Oracle General Ledger with Oracle Enterprise Performance Foundation

................................................................................................................................... 5-1

.......................................................................................................................................... 5-3

6 Setting Up Entities

Overview

Selected User Interface Elements for Setting Up Entities

Spreadsheet Loader

................................................................................................................................... 6-1

........................................................ 6-4

................................................................................................................... 6-7

.................. 5-17

 iii

7 Setting Up Categories

Overview................................................................................................................................... 7-1

Category Definitions................................................................................................................. 7-2

Selected User Interface Elements for Setting Up Categories................................................... 7-4

8 Setting Up Consolidation Methods

Overview................................................................................................................................... 8-1

Selected User Interface Elements for Setting Up Consolidation Methods..............................8-1

9 Setting Up Consolidation Rules

Overview................................................................................................................................... 9-1

Selected User Interface Elements for Setting Up Consolidation Rules

Consolidation Rule Steps

Balancing a Consolidation Rule................................................................................................ 9-3

Additional Data Types ............................................................................................................. 9-4

Examples of How Consolidation Rules Work.......................................................................... 9-4

Eliminate Investment in Subsidiary......................................................................................... 9-8

.......................................................................................................... 9-2

................................... 9-1

10 Setting Up Intercompany Rules

Overview................................................................................................................................. 10-1

Matching.................................................................................................................................. 10-1

Suspense Handling................................................................................................................. 10-2

Additional Data Types ........................................................................................................... 10-3

Example of How an Intercompany Rule Works..................................................................... 10-3

11 Setting Up Calendar Maps

Overview................................................................................................................................. 11-1

12 Setting Up Translation

Overview................................................................................................................................. 12-1

Translation Method

Entering Ending and Average Rates....................................................................................... 12-4

Historical Rates

Translation Example

................................................................................................................. 12-1

........................................................................................................................ 12-4

................................................................................................................12-6

13 Setting Up Consolidation Hierarchies

iv

Overview

................................................................................................................................. 13-1

Setting Up Consolidation Hierarchies.................................................................................... 13-2

Consolidation Hierarchy Structures....................................................................................... 13-6

Updating Consolidation Hierarchies...................................................................................... 13-7

Duplicate Hierarchies for Restatements and What-if Analysis............................................. 13-9

Multiple Parents ..................................................................................................................... 13-9

14 Submitting Data

Overview................................................................................................................................. 14-1

Monitoring Data Submission................................................................................................. 14-2

Setting Up Data Submission for Oracle Sources.................................................................... 14-4

Submitting Data for Oracle Sources....................................................................................... 14-6

Oracle Source Example............................................................................................................ 14-8

Setting Up Data Submission for External Sources............................................................... 14-10

Submitting Data for External Sources.................................................................................. 14-11

Selected User Interface Elements for Submitting Data for External Sources...................... 14-13

15 Running Consolidations

Overview................................................................................................................................. 15-1

Submitting Consolidations..................................................................................................... 15-4

Preparing Data for Analytical Reporting

................................................................................ 15-5

16 Adjustments

Overview................................................................................................................................. 16-1

Updating Adjustments

Disabling Adjustments

Selected User Interface Elements

Write back to General Ledger................................................................................................. 16-6

............................................................................................................ 16-5

........................................................................................................... 16-5

........................................................................................... 16-5

17 Accounting for Acquisitions and Disposals

Overview

Create Accounting for Consolidation Hierarchy Changes

Manually Entering Acquisition and Disposal Entries

Calculating Acquisition and Disposal Entries

Selected User Interface Elements for Acquisition and Disposal Rules ................................ 17-6

................................................................................................................................. 17-1

.................................................... 17-2

.......................................................... 17-4

....................................................................... 17-4

18 Viewing Reports

Overview................................................................................................................................. 18-1

Consolidation Trial Balance Report

Consolidation Entries Report.................................................................................................. 18-2

........................................................................................18-1

 v

Intercompany Matching Report.............................................................................................. 18-3

Data Submission Trial Balance Report................................................................................... 18-4

Data Submission Data Loaded Report....................................................................................18-4

Data Submission Impacted Balances Report.......................................................................... 18-5

Hierarchy Listing Report......................................................................................................... 18-5

Value Set Map Validation Report........................................................................................... 18-6

Write Back to General Ledger Report..................................................................................... 18-6

19 Setting Up Analytical Reporting

Overview................................................................................................................................. 19-1

Setting Up Analytical Reporting.............................................................................................19-1

Creating and Sharing Reports............................................................................................... 19-11

20 Setting Up Excel Add-in

Overview................................................................................................................................. 20-1

Reports..................................................................................................................................... 20-2

Saved Selections...................................................................................................................... 20-8

Security.................................................................................................................................... 20-9

Excel Add-in Configuration Options...................................................................................... 20-9

21 Security

Overview................................................................................................................................. 21-1

Role-Based Security................................................................................................................. 21-1

Function-Based Security

..........................................................................................................21-4

22 Integrating with Oracle Internal Controls Manager

Overview

Setup for Integration with Internal Controls Manager.......................................................... 22-1

Creating Auditable Units

Enabling Certification for a Consolidation Hierarchy

Creating Business Process and Financial Statement

Monitoring Financial Statement Certification Status

Monitoring Organization Certification Status

................................................................................................................................. 22-1

....................................................................................................... 22-2

........................................................... 22-3

.............................................................. 22-3

............................................................ 22-4

....................................................................... 22-4

A WebADI Spreadsheets

WebADI Spreadsheets

Requirements ........................................................................................................................... A-1

Downloading WebADI Spreadsheets

Uploading WebADI Spreadsheets .......................................................................................... A-2

.............................................................................................................. A-1

..................................................................................... A-2

vi

WebADI Selected User Interface Elements.............................................................................. A-3

B Concurrent Programs

Concurrent Programs................................................................................................................ B-1

C Business Events

Business Events ........................................................................................................................ C-1

D Profile Options

Profile Options..........................................................................................................................D-1

Index

 vii



Send Us Your Comments

Oracle Financial Consolidation Hub User's Guide, Release 11i

Part No. B16229-05

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 ix

Intended Audience

Welcome to Release 11i of the Oracle Financial Consolidation Hub User's Guide.

See Related Information Sources on page xii for more Oracle Applications product
information.

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

Preface

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 xi

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Structure

1 About Oracle Financial Consolidation Hub
2 The Oracle Financial Consolidation Hub Solution
3 Setting Up Oracle Financial Consolidation Hub
4 Setting Up Users
5 Setting Up Oracle Enterprise Performance Foundation
6 Setting Up Entities
7 Setting Up Categories
8 Setting Up Consolidation Methods
9 Setting Up Consolidation Rules
10 Setting Up Intercompany Rules
11 Setting Up Calendar Maps
12 Setting Up Translation
13 Setting Up Consolidation Hierarchies
14 Submitting Data
15 Running Consolidations
16 Adjustments
17 Accounting for Acquisitions and Disposals
18 Viewing Reports
19 Setting Up Analytical Reporting
20 Setting Up Excel Add-in
21 Security
22 Integrating with Oracle Internal Controls Manager
A WebADI Spreadsheets
B Concurrent Programs
C Business Events
D Profile Options

Related Information Sources

You can choose from many sources of information, including online documentation,
training, and support services, to increase your knowledge and understanding of
Financial Consolidation Hub. If this guide refers you to other Oracle Applications
documentation, use only the Release 11i versions of those guides.

Online Documentation

All Oracle Applications documentation is available online (HTML or PDF).

1.

Online Help – Online help patches (HTML) are available on OracleMetaLink.

2.

About Documents – Refer to the About Document for the mini–pack or family pack

xii

that you have installed to learn about new documentation or documentation
patches that you can download. About Documents are available on OracleMetaLink.

User Guides Related to this Product

• Oracle General Ledger User Guide: This guide contains the information you need

to implement and set up Oracle General Ledger. Also included in the guide is
descriptive information on the following areas: entering and posting journal entries,
creating budgets, performing inquiries, using reporting tools, using Global
Consolidation System to consolidate multiple companies, using multi-currency and
encumbrance accounting, using average balance processing features, using
standard reports and listings, and performing maintenance tasks.

• Oracle Enterprise Performance Foundation User's Guide: This guide helps you

understand and use Oracle Enterprise Performance Foundation. It describes how to
use the dimension and hierarchy management features available through Oracle
Enterprise Performance Foundation and describes the tasks related to schema
administration in Oracle Enterprise Performance Foundation. Additionally, the x
guide introduces the Oracle Enterprise Performance Foundation interface
architecture and its use of external data loaders.

• Oracle XML Publisher User's Guide: This guide instructs users on how to use

Oracle XML Publisher to create customized reports from the Oracle E-Business
Suite.

• Oracle Web Applications Desktop Integrator User Guide: ADI is an integral part

of the Oracle General Ledger application. ADI is a spreadsheet–based extension of
General Ledger. and Oracle Assets, that offers full–cycle accounting within the
comfort and familiarity of a spreadsheet. This guide describes how to use
Applications Desktop Integrator's (ADI) Budget, Journal, Create Assets, Reconcile
Physical Inventory, Import Assets, and Report Wizards. You can use these
spreadsheet–based tools for entering journals, entering and revising budgets,
maintaining your asset inventory, and creating financial reports. The guide also
describes how to use the Request Center to submit and monitor concurrent
requests, then download the report output for publishing to a spreadsheet or a web
page.

• Oracle Applications Flexfields Guide: This manual provides flexfields planning,

setup, and reference information for the General Ledger implementation team, as
well as for users responsible for the ongoing maintenance of Oracle Applications
product data. This manual also provides information on creating custom reports on
flexfields data.

User Guides Related to all Products

• Oracle Applications User's Guide: This guide explains how to enter data, query,

run reports, and navigate using the graphical user interface (GUI) available with
this release of Financial Consolidation Hub (and any other Oracle Applications

 xiii

products). This guide also includes information on setting user profiles, as well as
running and reviewing reports and concurrent processes. You can access this user's
guide online by choosing Getting Started with Oracle Applications from any Oracle
Applications help file.

Installation and System Administration

• Oracle Applications Concepts: This guide provides an introduction to the concepts,

features, technology stack, architecture, and terminology for Oracle Applications
Release 11i. It provides a useful first book to read before installing Oracle
Applications. This guide also introduces the concepts behind Applications–wide
features such as Business Intelligence (BIS), languages and character sets, and Self–
Service Web Applications.

• Installing Oracle Applications: This guide provides instructions for managing the

installation of Oracle Applications products. In Release 11i, much of the installation
process is handled using Oracle Rapid Install, which minimizes the time to install
Oracle Applications and the technology stack by automating many of the required
steps. This guide contains instructions for using Oracle Rapid Install and lists the
tasks you need to perform to finish your installation. You should use this guide in
conjunction with individual product users' guides and implementation guides.

• Upgrading Oracle Applications: Refer to this guide if you are upgrading your

Oracle Applications Release 10.7 or Release 11.0 products to Release 11i. This guide
describes the upgrade process and lists database and product–specific upgrade xi
tasks. You must be either at Release 10.7 (NCA, SmartClient, or character mode) or
Release 11.0, to upgrade to Release 11i. You cannot upgrade to Release 11i directly
from releases prior to 10.7.

• Maintaining Oracle Applications: Use this guide to help you run the various AD

utilities, such as AutoUpgrade, AutoPatch, AD Administration, AD Controller, AD
Relink, License Manager, and others. It contains how–to steps, screenshots, and
other information that you need to run the AD utilities. This guide also provides
information on maintaining the Oracle Applications file system and database.

• Oracle Applications System Administrator's Guide: This guide provides planning

and reference information for the Oracle Applications System Administrator. It
contains information on how to define security, customize menus and online help,
and manage concurrent processing.

• Oracle Alert User's Guide: This guide explains how to define periodic and event

alerts to monitor the status of your Oracle Applications data.

• Oracle Applications Developer's Guide: This guide contains the coding standards

followed by the Oracle Applications development staff. It describes the Oracle
Application Object Library components needed to implement the Oracle
Applications user interface described in the Oracle Applications User Interface

xiv

Standards for Forms–Based Products. It also provides information to help you build
your custom Oracle Forms Developer 6i forms so that they integrate with Oracle
Applications.

Other Implementation Documentation

• Oracle Workflow Administrator's Guide: This guide explains how to complete the

setup steps necessary for any Oracle Applications product that includes workflow–
enabled processes, as well as how to monitor the progress of runtime workflow
processes.

• Oracle Workflow Developer's Guide: This guide explains how to define new

workflow business processes and customize existing Oracle Applications–
embedded workflow processes. It also describes how to define and customize
business events and event subscriptions.

• Oracle Workflow User's Guide: This guide describes how Oracle Applications

users can view and respond to workflow notifications and monitor the progress of
their workflow processes.

• Oracle Workflow API Reference: This guide describes the APIs provided for

developers and administrators to access Oracle Workflow.

• Oracle eTechnical Reference Manuals: Each eTechnical Reference Manual (eTRM)

contains database diagrams and a detailed description of database tables, forms,
reports, and programs for a specific Oracle Applications product. This information
helps you convert data from your existing applications and integrate Oracle
Applications data with non–Oracle applications, and write custom reports for
Oracle Applications products. Oracle eTRM is available on OracleMetaLink.

• Oracle Applications Message Reference Manual: This manual describes all Oracle
Applications messages. This manual is available in HTML format on the
documentation CD–ROM for Release 11i.

Do Not Use Database Tools to Modify Oracle Applications Data

Oracle STRONGLY RECOMMENDS that you never use SQL*Plus, Oracle Data
Browser, database triggers, or any other tool to modify Oracle Applications data unless
otherwise instructed.

Oracle provides powerful tools you can use to create, store, change, retrieve, and
maintain information in an Oracle database. But if you use Oracle tools such as
SQL*Plus to modify Oracle Applications data, you risk destroying the integrity of your
data and you lose the ability to audit changes to your data.

Because Oracle Applications tables are interrelated, any change you make using an
Oracle Applications form can update many tables at once. But when you modify Oracle
Applications data using anything other than Oracle Applications, you may change a

 xv

row in one table without making corresponding changes in related tables. If your tables
get out of synchronization with each other, you risk retrieving erroneous information
and you risk unpredictable results throughout Oracle Applications.

When you use Oracle Applications to modify your data, Oracle Applications
automatically checks that your changes are valid. Oracle Applications also keeps track
of who changes information. If you enter information into database tables using
database tools, you may store invalid information. You also lose the ability to track who
has changed your information because SQL*Plus and other database tools do not keep a
record of changes.

xvi

About Oracle Financial Consolidation Hub

Oracle Financial Consolidation Hub Overview

Oracle Financial Consolidation Hub brings together financial data from disparate
sources to create a single, global view of financial information across the entire
enterprise. By providing one consistent view of your enterprise's financial position
across complex organizational boundaries, it enables you to confidently comply with
financial reporting requirements, adapt to changing business conditions, and establish a
basis for ongoing, enterprise-wide performance management. Financial Consolidation
Hub is a key component of Oracle's Corporate Performance Management Suite, a
comprehensive solution for improving performance across all facets of your business.

Complies with Financial Reporting Requirements

1

Enterprises today are under constant pressure to speed the process of closing their
books, striving to comply with more stringent financial reporting requirements while
seeking faster access to critical business information. Compounding these pressures are
disparate financial systems; complex ownership structures; and multiple business units,
cost centers, or consolidation structures that make consolidating financial data a
manual, time consuming, and resource-intensive process. Financial Consolidation Hub
provides faster processing and deeper visibility into a single source of consolidated
results to significantly help with accelerated reporting, expanded disclosures, and
certified internal controls.

Adapts to Dynamic and Complex Business Conditions

After spending the last decade cutting costs and missing revenue targets, executive
offices worldwide are now pursuing a diversified and sustainable mix of top-line
growth initiatives. Strategies such as tapping into expanding markets or market
segments, moving into adjacent markets, or investing in completely new markets
require flexible, adaptable systems that can keep pace with a business environment
unprecedented in its rate of change. Financial Consolidation Hub is built to adapt to

About Oracle Financial Consolidation Hub 1-1

changing business requirements, offering an open architecture that rationalizes data
from disparate systems into a single, actionable source of truth.

Provides a Basis for Enterprise-Wide Performance Management

Today's financial organizations are being called upon to achieve both strategic and
operational excellence. After all, the best plans in the world are futile without effective
execution; likewise, effective execution is wasted if it's based on flawed strategy.
Achieving such corporate alignment requires a single, enterprise view of the firm's
financial position. Financial Consolidation Hub creates this view by integrating
multiple subsidiaries and investments from a variety of countries with disparate
accounting systems, ownership structures, charts of accounts, and currencies. By
providing accurate, timely, and enterprise-wide information, Financial Consolidation
Hub provides a foundation, upon which financial organizations can establish and
evaluate business strategies.

1-2 Oracle Financial Consolidation Hub User's Guide

The Oracle Financial Consolidation Hub

Quick Reference

This chapter provides a quick reference to the common issues encountered in the
implementation of a consolidation system. It is a starting point where you can review
the issues, gain a high level understanding of how Financial Consolidation Hub handles
the issues, and find a reference to the section in this user's guide where you can obtain
further information. For ease of presentation the issues are organized in the following
tables into three categories: data submission, consolidation processing, and reporting
and analysis.

2

Solution

Data Submission

Issue Functionality Reference

Use data from
Oracle General
Ledger.

Load data from
other systems.

Provides direct access to data in
Oracle General Ledger.

Supports spreadsheet-based
uploads over the Web.

•

Setting up Enterprise Performance Foundation,
page 5-1

See: Processing Keys, page 5-4

•

Submitting Data for Oracle Entities, page 14-6

•

Spreadsheet Loader, page 14-11

The Oracle Financial Consolidation Hub Solution 2-1

Issue Functionality Reference

Standardize data. Includes complete

transformation, validation, and
chart of accounts
standardization capabilities.

Enforce security. Ability to secure who is

authorized to load data.

Consolidation Processing

•

Submitting Data, page 14-1

Submitting Data for External Entities, page 14-11

Transformation Rule Sets, page 14-10

Validation Rule Sets, page 14-10

•

Setting up Enterprise Performance Foundation,
page 5-1

Task 4: Value Sets, page 5-8

Task 8: Value Set Maps, page 5-12

•

Secure by Role, page 6-4

•

Specifying Security Options, page 13-4

•

Role-Based Security, page 21-1

Issue Functionality Reference

Consolidate based
upon different
structures and
accounting methods.

Support
date-effective
structures.

Automatically track
changes.

Consolidation hierarchies model
different structures and methods.

Consolidation hierarchies are date
effective.

If Oracle General Ledger data
changes, consolidation informs the
user. Hierarchy changes display
impact on screen and in
notifications.

•

Setting Up Consolidation Methods, page 8-1

•

Consolidation Rule Steps, page 9-2

•

Updating Consolidation Hierarchies, page 13-7

•

Oracle Entities Example, page 14-8

•

Updating Consolidation Hierarchies, page 13-7

•

Process Status, page 15-2

2-2 Oracle Financial Consolidation Hub User's Guide

Issue Functionality Reference

Incremental
consolidation
processing.

Monitor
consolidation in real
time.

Compare and audit
results.

Allow adjustments. Provides spreadsheet uploads for

Automate
intercompany
eliminations.

Automatically create
consolidation entries.

Incremental consolidation
processes areas impacted by
changes.

Icons display up to the minute
status for all subsidiary and
consolidation points.

Store details for every
consolidation run and you can
audit this using drill-down reports.

consolidation and operating
adjustments.

Intercompany rules automate both
intercompany and intracompany
eliminations.

You can automatically create
entries using consolidation rules.

•

Submitting Consolidations, page 15-4

•

Process Status, page 15-2

•

Process History, page 15-4

•

Adjustments, page 16-5

•

Matching, page 10-1

•

Consolidation Rule Steps, page 9-2

Perform currency
standardization.

Reconcile legal and
management results.

Lock results. Locks results against changes at

Enforce security. Provides ability to secure

Certify financial
statements.

Automatically performed any time
an entity's currency differs from
that of its parent.

Creates both results as part of a
single consolidation.

any level.

consolidation processing and
results by hierarchy.

Certifies financial statements and
business processes.

•

Overview, page 12-1

•

Creating and Sharing Reports, page 19-11

•

Locking Results, page 15-4

•

Role-Based Security, page 21-1

•

Locking Results, page 15-4

•

Integrating with Internal Controls Manager,
page 22-1

The Oracle Financial Consolidation Hub Solution 2-3

Reporting and Analysis

Issue Functionality Reference

Distribute
consolidation results.

Allow ad-hoc
analysis and
drill-down.

Align budgets and
actuals.

Support
date-effective
reorganizations.

Enable time series
and variance
analysis.

Includes automatic distribution of
online reports containing
consolidation results.

Integrated multi-dimensional
reporting provides online
drill-down, select, rotate, and graph
capabilities.

Both sets of data reside in the same
database, use the same dimensions,
and you can view in the same
report.

Easily edit and view multiple
organization hierarchies in the
same data model.

Administrators or end users can
define and save formulas for use in
reports.

•

Defining a Notify Task, Oracle Enterprise

Planning and Budgeting User's Guide

•

Working with Crosstabs, Oracle Enterprise

Planning and Budgeting User's Guide

•

Task 1: Processing Keys, page 5-4

•

Creating and Sharing Reports, page 19-11

•

About Business Process Administration, Oracle

Enterprise Planning and Budgeting User's Guide

•

Dimension Hierarchies, page 5-11

•

Working with Calculations, Oracle Enterprise

Planning and Budgeting User's Guide

Provide alerts. Notifications can be sent based

upon performance triggers.

Export to common
formats.

Security Detailed security settings can be

2-4 Oracle Financial Consolidation Hub User's Guide

Reports can be exported to Excel,
HTML, XML, and Oracle reports
formats.

applied to each reporting user.

•

Defining an Exception Alert Task, Oracle

Enterprise Planning and Budgeting User's Guide

•

Exporting Data from Crosstabs, Oracle

Enterprise Planning and Budgeting User's Guide

•

Administering Security, Oracle Enterprise

Planning and Budgeting User's Guide

Setting Up Oracle Financial Consolidation

Oracle Financial Consolidation Hub Setup Overview

The following table shows the Oracle Financial Consolidation Hub setup checklist.
Complete all required steps in the sequence indicated.

Financial Consolidation Hub Setup Checklist

Step Number Setup Step Step Type Description

3

Hub

Oracle Applications
System
Administrator or
Oracle User
Management

1. Set Up Roles, page

Oracle Financial
Consolidation Hub

2. Set Up Enterprise

3. Set Up Entities, page

  

21-1

  

Performance
Foundation, page 5­1

6-1

Required Used for notifications

and security

Required Used to define

dimensionality and
reference data

Required Used to hold general

ledger data

Setting Up Oracle Financial Consolidation Hub 3-1

Step Number Setup Step Step Type Description

4. Set Up Categories,
page 7-1

5. Set Up Consolidation
Methods, page 8-1

6. Set Up Consolidation
Rules, page 9-1

7. Set Up Intercompany
Rules, page 10-1

8. Set Up Calendar
Maps, page 11-1

9. Set Up Translation,
page 12-1

Optional Used to designate

business processes
within consolidation

Optional Used to group

consolidation rules
together

Optional Used to automate

consolidation entries

Optional Used for

intercompany and
intracompany
eliminations

Optional Used to designate the

consolidation
calendar and
standardize other
calendars

Optional Used to translate or

remeasure data to a
parent's currency.
Skip this step if are
implementing a single
currency.

10. Set Up Consolidation
Hierarchies, page 13­1

3-2 Oracle Financial Consolidation Hub User's Guide

Required Used to organize

entities for
consolidation

Overview

4

Setting Up Users

To implement Oracle Financial Consolidation Hub, define users and assign them
responsibilities. Each responsibility offers access to a different functionality in different
products. This chapter lists the common responsibilities required to implement
Financial Consolidation Hub.

For details on the security surrounding users and responsibilities, see Security, page 21-

1.

To implement Financial Consolidation Hub, you may require access to the following
products or functionality as listed in the following table.

Responsibility Product Functionality

Consolidation Manager Financial Consolidation Hub Set up Financial

Consolidation Hub, perform
data submissions, and run
consolidation

Legal Entity Controller Financial Consolidation Hub Perform data submissions

Enterprise Performance
Foundation Administrator

Enterprise Performance
Foundation

Manage meta-data and ledger
setup in the Enterprise
Performance Foundation
architecture, and integration
with Oracle General Ledger

Setting Up Users 4-1

Responsibility Product Functionality

Enterprise Planning and
Budgeting Controller

Enterprise Planning and
Budgeting Security
Administrator

System Administrator

XML Publisher Administrator XML Publisher Create new report templates

General Ledger Super User Oracle General Ledger Super User access to Oracle

Enterprise Planning and
Budgeting

Enterprise Planning and
Budgeting



Pull consolidation data into
Enterprise Planning and
Budgeting and create
analytical reports

Set security settings to give
your user access to Enterprise
Planning and Budgeting
components

Manage system configuration
such as profile options, users
and responsibilities

General Ledger (only
necessary if you are
consolidating operating
balances in Oracle General
Ledger)

Note: This is only a list of the typical responsibilities needed to

implement Financial Consolidation Hub. It does not take into account
any security considerations that you may have. Use your security
model to determine which users will have access to which
responsibilities. For responsibilities outside of Financial Consolidation
Hub, please refer to the corresponding user guides to determine a
complete list of available responsibilities and security considerations.

4-2 Oracle Financial Consolidation Hub User's Guide

Setting Up Oracle Enterprise Performance

Foundation

Overview

Oracle's Corporate Performance Management applications, including Financial
Consolidation Hub, share a common data model called Oracle Enterprise Performance
Foundation. Enterprise Performance Foundation provides a storage area for managing
reference data that contains dimensions, dimension members, hierarchies, and business
data. Financial Consolidation Hub, Enterprise Planning and Budgeting, and
Profitability Manager use this reference data. Oracle General Ledger users can transfer
their reference and financial data into Enterprise Performance Foundation. Other
customers can load reference and transactional data from third party systems using
spreadsheet loaders and open interfaces.

5

EPF comes with a set of pre-defined fact tables; a table called FEM_BALANCES
(Balances table) that is used to store financial balances loaded from Oracle General
Ledger or any other financial system, and 20 tables called FEM_DATA1 to
FEM_DATA20 to be used for other purposes. Financial Consolidation Hub uses the
Balances table in two key ways:

• Reads from the table to access the financial data from an enterprise's subsidiaries.

• Writes consolidated results back to the table.

This provides you with a single data source when you perform any financial or
management reporting.

Each fact table includes a number of dimension columns. These dimensions are used to
model your business and are analogous to the segments of an Oracle General Ledger
chart of accounts. Since Oracle's analytical applications share a common data model,
some of these dimensions may be relevant to Financial Consolidation Hub while others
may not.

Setting Up Oracle Enterprise Performance Foundation 5-1

Required Dimensions for Financial Consolidation Hub

1. Entity - Used to represent the legal entities or business units that you want to

consolidate.

See: Setting Up Entities, page 6-1

Company Cost Center Organization - The main organizational dimension by which

2.

you record accounting data. Company cost center organizations are subsets of
entities.

3. Intercompany - Used to identify and eliminate intercompany activity. It shares the

same values as the company cost center organization dimension. Financial
Consolidation Hub uses the intercompany dimension, together with the company
cost center organization dimension, to identify balances that should be eliminated.

Line Item - Used to categorize the type of financial balance. Oracle General Ledger

4.

users specify a natural account segment in their chart of accounts. The line item
dimension is analogous to this segment. Most consolidation eliminations, such as
intercompany and minority interest, are based on this dimension and most financial
reporting is also based on this dimension.

5. Calendar Period - Based on the accounting calendar for your organization.

6. Currency - Identifies the currency for each balance. Each entity typically has one

base currency and the financial data loaded for that entity is denominated in that
currency. If an entity is consolidated to a higher-level entity with a different
currency, Financial Consolidation Hub automatically translates from one currency
to the other.

Optional Dimensions for Financial Consolidation Hub

1. Channel - Used to identify the channel associated with a financial balance.

2. Customer - Used to identify the customer associated with a financial balance.

3.

Financial Element - Used to identify the type of financial balance such as ending
balance, average balance, and statistical balance. It is widely used in the financial
services industry and in Oracle Financial Services Applications that share the
Enterprise Performance Foundation data model. If you consolidate average
balances, or statistics, or both, you must enable this dimension. These types of
balances are identified by the financial element.

4.

Natural Account - This is similar to the line item dimension. It is available in
addition to line item because you may need to track two different types of natural
account. For example, one for legal reporting and one for management, or one for

5-2 Oracle Financial Consolidation Hub User's Guide

local GAAP and one for corporate GAAP. This dimension can be used in
conjunction with line item for these purposes.

5. Product - Used to identify the product associated with a financial balance.

6. Project - Used to identify the project associated with a financial balance.

7. User Dimension 1 to 10 - These dimensions can be enabled for any purposes not

addressed by the above mentioned dimensions.

Dimensions Used Internally by Financial Consolidation Hub

1. Created by Object - Used to identify the category in the consolidation process that

produced a given consolidated balance. Examples of categories include
intercompany, minority interest, and aggregation. You can use the object dimension
to view this granularity during reporting, but for consolidation processing, the
object dimension is handled internally.

See: Setting Up Categories, page 7-1.

2. Currency Type - Used to distinguish financial data that is entered in a specific

currency from balances that are translated to a specific currency.

3. Data Set - Used to group different types of data. Financial Consolidation Hub

automatically creates a data set for each hierarchy and balance type.

4. Ledger - Used to identify the set of books or ledger from which a financial balance

was loaded.

Dimensions not Used by Financial Consolidation Hub

Financial Consolidation Hub does not support the following dimensions. Do not enable
them for Financial Consolidation Hub processing.

1.

Activity

2.

Cost Object

Tasks

Before proceeding with consolidation-specific setup steps, you must complete all
required tasks outlined on the Foundation page. These tasks perform the following two
functions.

1.

Provides a streamlined setup of Enterprise Performance Foundation for Financial
Consolidation Hub purposes. You can perform the same setup from the Enterprise

Setting Up Oracle Enterprise Performance Foundation 5-3

Performance Foundation user interface; however, the Foundation tasks hide much
of the complexity that is not relevant for using Financial Consolidation Hub.

2. Provides some initial configuration for Financial Consolidation Hub.

Note: Some tasks may not be necessary depending on your specific

implementation of Financial Consolidation Hub. In such cases, update
the status of the task to Complete.

Initial Setup Tasks for Enterprise Performance Foundation

Perform the following initial steps before you perform the task in Foundation. The
following steps are recommended for the implementation of Financial Consolidation
Hub. Select the Enterprise Performance Foundation Administrator responsibility:

Set signage to Standard GAAP. Using the System Administrator responsibility,

1.

navigate to Profile > System. Set the FEM: Signage profile option to Standard
General Accounting Principles. Using the EPF Administrator responsibility,
navigate to Processes Management > Requests > Submit Request. Run the Sign
Extended Account Types concurrent program .

2. Set negative format to using a negative sign. Using the System Administrator

responsibility, navigate to Profile > System. Set the Currency:Negative Format
profile option to –XXX. FCH reports will now represent negative numbers using the
negative sign. If any other options are selected, negative numbers in the Excel
reports in Financial Consolidation Hub will not properly be read as numbers.

3. Grant the Enterprise Performance Foundation access to your users. Using the

Enterprise Performance Foundation Administrator responsibility, navigate to
Administration > Security. Grant read/write access to the Default and Data
Integration folders to your users.

Task 1: Processing Keys

Task 1 must be the first thing you do in Financial Consolidation Hub. For Task 1,
identify the dimensions that you will use.

Note:

Enterprise Performance Foundation, you must consider all of the
dimensions that must be enabled for Enterprise Performance
Foundation for all the products.

If you are using other Oracle products that sit on top of

5-4 Oracle Financial Consolidation Hub User's Guide

Column

Select the dimensions that you want to set as active in Enterprise Performance
Foundation. These dimensions will be the superset of the dimensions used by Financial
Consolidation Hub and any other Oracle products that you use on top of Enterprise
Performance Foundation. For Financial Consolidation Hub purposes, this will be the set
of dimensions that are used for loading source data.

See: Required Dimensions for Financial Consolidation Hub, page 5-2.

To set a dimension active in Enterprise Performance Foundation, add the dimension to
the table of active dimensions.

Used By Processing

From the active set of dimensions, you must then specify those to be used for
consolidation processing. It is possible that you may load financial data by a dimension
that you are not interested in for consolidation purposes. For example, your general
ledger data may contain product-level information, and it may be used in other
Enterprise Performance Foundation applications. However, including product-specific
information in your consolidation process may be unnecessary. In this case, Financial
Consolidation Hub aggregates across all values of this dimension during processing. To
set a dimension active for consolidation processing, select the Used by Processing
column for the dimension.

Used By Analytical Reporting

From the set of processing dimensions, you must then specify those to be used for
analytical reporting. Again, it is possible that you may consolidate by a dimension, but
not need to report against it. By disabling a dimension for reporting, you can reduce the
size of the analytical workspaces and make reports easier to understand. To set a
dimension active for analytical reporting, select the Used by Analytical Reporting
column for the dimension.

See: Setting Up Analytical Reports, page 19-1.

Note:

The Used by Analytical Reporting does not affect the
dimensionality of the static reports in Financial Consolidation Hub.
These reports will use the selected dimensions in Enterprise
Performance Foundation or Used by Processing where appropriate.

See: Viewing Reports, page 18-1

Caution:

selections. After creating entities and performing data submission, you
cannot change these selections.

Before completing Task 1, review your dimension column

Setting Up Oracle Enterprise Performance Foundation 5-5

Used By Historical Rates

You can define the dimensions that should be used in the historical rates definition. The
dimensions you can choose are a subset of those you selected for Used by Processing.
The dimensionality for Historical rates is specified in the Used by Historical Rates
column. This column cannot be updated if Historical Rates already exist in the system.

See: Historical Rates, page 12-4

Task 2: FEM Balances Index

Task 2 must be the second step you do in Financial Consolidation Hub after completing
Task 1. For Task 2, System Administrators must manually create a unique index on the
Balances table and Financial Consolidation Hub interface table. You must recreate
FEM_BALANCES_P and create a unique index for FEM_BAL_INTERFACE_T that
contains all the dimension columns selected in Task 1. To see details on the SQL script
needed to recreate FEM_BALANCES_P based on your selected dimensions, click
Preview Index Definition. The preview provides the recommended ordering of columns
for optimal performance for Financial Consolidation Hub. Your database administrator
may further refine the index definition if other applications are being leveraged.

See: Oracle Enterprise Performance Foundation User Guide

Task 3: Data Types

Task 3 must be the third step you do in Financial Consolidation Hub after completing
Task 2. For Task 2, you will be specifying the dataset to use for Actual and Average
balances, as well as optionally defining other balance types.

For Task 3, you can do the following:

• Create any additional data types that you need such as budgets.

• View or update any existing data types.

For a given entity or consolidation hierarchy, you can perform data submission and
consolidation for each data type.

For each data type that you create, you must specify a data set. You can create and
manage data sets using the Enterprise Performance Foundation Administrator
responsibility, Configuration Rules > Dimension.

The Actual and Average balance types are seeded in Financial Consolidation Hub, and
require you to specify an Actual data set. The following table shows the attributes
required for actual data sets.

5-6 Oracle Financial Consolidation Hub User's Guide

Data Sets Attributes

Dataset Balance Type Code Actual

Dataset Update Flag Yes

Dataset Production Flag Yes

Dataset System Code <User specified>

Note: You can not create additional Actual balance types. You may

only use the seeded ones.

The following table shows attributes required for Encumbrance data sets.

Data Sets Attributes

Dataset Balance Type Code Encumbrance

Dataset Encumbrance Type ID <User specified>

Dataset Update Flag Yes

Dataset Production Flag Yes

Dataset System Code <User specified>

Note: You can only create one data type per Dataset Encumbrance Type

ID.

Budget data sets require the following attributes:

Data Sets Attributes

Dataset Balance Type Code Budget

Dataset Budget Type ID <User specified>

Setting Up Oracle Enterprise Performance Foundation 5-7

Data Sets Attributes

Dataset Update Flag Yes

Dataset Production Flag Yes

Dataset System Code <User specified>

Note: You can only create one data type per Dataset Budget Type ID.

Note: You cannot create additional data types for Actual balances.

Additionally, set the following three parameters for data types:

• Enforce Balancing - When you perform consolidation on this data type, the
application uses suspense handling to enforce balancing.

• Apply Elimination Rules - When you perform consolidation on this data type, the
application performs intercompany eliminations.

• Apply Consolidation Rules - When you perform consolidation on this data type, the

Task 4: Value Sets

Task 4 is only necessary if you need to define additional value sets in Enterprise
Performance Foundation. For Task 4, you can do the following:

• Create value sets for dimensions

• Search for and view any existing value sets

A value set is a list of dimension members that belong to a particular dimension. Value
Sets are used to separate dimension members into meaningful sets. For example, a
company may perform accounting according to local and corporate standards. It can
create a value set for each, such that natural account 1110 may correspond to Cash in
the local value set, whereas it corresponds to Accounts Receivable in the corporate
value set.

Financial Consolidation Hub offers a default value set for each dimension. Additionally,
if you use Oracle General Ledger, all the value sets associated with your chart of
accounts structures will automatically be synchronized with Enterprise Performance
Foundation. Therefore, you only need to create additional value sets in Enterprise
Performance Foundation if you are loading data from third party financial systems that

application applies consolidation rules.

5-8 Oracle Financial Consolidation Hub User's Guide

use different sets of values. If all financial data brought in through external systems is
based on a single chart of accounts, or is transferred from Oracle General Ledger, you
can omit this step.

To transfer data from Oracle General Ledger to Enterprise Performance Foundation, see
Using Oracle General Ledger with Enterprise Performance Foundation, page 5-17.

Task 5: Consolidation Global Value Set Combination

Perform Task 5 before creating any setup elements in Financial Consolidation Hub such
as entities and consolidation hierarchies. For Task 5, select a single global value set
combination for the system to use for consolidated results that represents your
corporate account structure. The global value set combination in Enterprise
Performance Foundation is analogous to a chart of accounts. This determines the value
set used for consolidation for each dimension. Any data that is loaded from external
systems using different value sets must be mapped to the global value set combination.
Financial Consolidation Hub automatically maps this in the Data Preparation step of
the Consolidation process based on mappings defined by the user in Task 8: Value Set
Maps.

You can select the seeded default global value set combination or you can create a
global value set combination if needed. Once you click Complete, Financial
Consolidation Hub will launch the FCH: Module Initialization concurrent program.
Monitor this concurrent program and verify that it completes successfully.

You can create a global value set combination in Enterprise Performance Foundation
using the Enterprise Performance Foundation Administrator responsibility,
Administration > Registration > Global Value Set Combination.

The Consolidation Global Value Set Combination must have the

Note:

entity dimension set to the default value set, Entity .

If you are using Oracle General Ledger, a global value set combination is automatically
created for each chart of accounts that you transfer to Enterprise Performance
Foundation.

To transfer data from Oracle General Ledger to Enterprise Performance Foundation, see
Using Oracle General Ledger with Enterprise Performance Foundation, page 5-17.

Caution:

creating consolidation hierarchies and entities, you cannot change your
global value set combination selection.

Task 6: Dimension Members

Task 6 is only necessary if are creating additional dimension members. For Task 6, you
can do the following:

Before completing Task 5, review your selection. After

Setting Up Oracle Enterprise Performance Foundation 5-9

• Add dimension members to dimensions

• Search for, view, and update any existing members

A dimension is a classification scheme used to categorize or group business data. For
example, data can be grouped by the line item, product, geographical area, customer,
natural account, and time. A dimension contains dimension members. For example, the
Line Item dimension might have dimension members of Total Assets and Fixed Assets.

If you use Oracle General Ledger, then the segment values for the relevant charts of
accounts are automatically synchronized with Enterprise Performance Foundation as
dimension members. For more information on transferring segment values from Oracle
General Ledger, see Using Oracle General Ledger with Enterprise Performance
Foundation, page 5-17. If you do not use Oracle General Ledger, or if you need
additional dimension members for analytical or consolidation purposes, you can create
them using WebADI spreadsheet loaders. In addition, you can update existing
dimension members through the spreadsheet loaders.

See: WebADI Spreadsheets, page A-1

The spreadsheet loaders include columns for display code, name, description, and value
set. If you are working with the following dimensions, the spreadsheet loaders include
additional columns:

• Line Item - An additional column is available to select the account type

• Natural Account - An additional column is available to select the account type

• Company Cost Center Organization - Additional columns are available to enter the
company and cost center associated with each organization. Company is required
but cost center is optional.

This task cannot be used for the following situations:

• Creating, viewing, and updating members for the entity dimension. Entities are
handled through a separate Entity user interface.

See: Setting Up Entities, page 6-1

• Updating or creating members pulled through the Oracle General Ledger
integration. If a dimension member was created through the Oracle General Ledger
integration, do not update it. Also do not create new dimension members for a
value set that was created through Oracle General Ledger integration. Instead,
create the new values in Oracle General Ledger and rerun Oracle General Ledger
integration.

See: Using Oracle General Ledger with Oracle Enterprise Performance Foundation,
page 5-17

Some attributes for dimension members do not appear in the spreadsheet loader.
Financial Consolidation Hub automatically populates these attributes . To view the full

5-10 Oracle Financial Consolidation Hub User's Guide

list of attributes for a dimension member, use the Enterprise Performance Foundation
Administrator responsibility, navigate to Configuration Rules > Dimension > Members.
Here, you can use the Enterprise Performance Foundation user interface to view,
update, and create dimension members. You can also use the WebADI spreadsheet
loader.

Note: The Enterprise Performance Foundation user interface will access

dimension members from the ledger specified in Application
Preference, set the Ledger to the ledger you want to view. See: Initial
Setup in Enterprise Performance Foundation, page 5-4 .

Note: Although the Financial Consolidation Hub user interface does

not allow you to disable dimension members, Financial Consolidation
Hub enforces disabling for any dimension members you disable in
Enterprise Performance Foundation. For example, you cannot run data
submission on a calendar period that is disabled in Enterprise
Performance Foundation.

Task 7: Dimension Hierarchies

Task 7 is only necessary if you need to create additional dimension hierarchies. For Task
7, you can do the following:

• Create dimension hierarchies for processing and reporting

• Search and view, and search and update any existing dimension hierarchies

A dimension hierarchy is a structure of dimension members that is organized by
parent/child relationships. Dimension hierarchies can have multiple versions, all of
which have an effective date range.

If you are using Oracle General Ledger, then the segment value hierarchies for the
relevant charts of accounts are automatically synchronized with Enterprise Performance
Foundation as dimension hierarchies.

For information on transferring dimension hierarchies from Oracle General Ledger to
Enterprise Performance Foundation, see Using Oracle General Ledger with Enterprise
Performance Foundation, page 5-17.

If you do not use Oracle General Ledger or if you need additional hierarchies for
analytical or consolidation purposes, you can create them using WebADI spreadsheet
loaders. You can also use the spreadsheet loaders to update any existing hierarchies.
The spreadsheet loaders enable you to enter hierarchies as an unlimited number of
parent-child pairs. You can version hierarchies, for example, to take reorganizations
into account. When you run consolidation, Financial Consolidation Hub uses the
appropriate version based on the effective date for which you are consolidating.

Setting Up Oracle Enterprise Performance Foundation 5-11

See: WebADI spreadsheets, page A-1

Note: In the spreadsheet loader, you must enter top parents in a row

with its value entered for the Parent and Child columns.

Note: Creating consolidation hierarchies for the Entity dimension is

done through a separate Consolidation Hierarchy user interface.

See: Setting Up Consolidation Hierarchies, page 13-2

Task 8: Value Set Maps

Task 8 is only necessary if you have multiple chart of accounts and need to create value
set maps. For Task 8, you can do the following:

• Create value set maps

• Update the current value set map for a dimension

A value set map specifies the relationship between dimension members in child value
sets to dimension members in the consolidation value set. Each dimension can have
only one value set map, but each value set map can have multiple date effective
versions. You create Value set maps so the system can convert data in multiple value
sets to the single global value set combination you selected in Task 5.

Standardizing on a single chart of accounts is one of the challenges you encounter when
you load data from subsidiaries running different accounting systems in different
regions of the world. Financial Consolidation Hub enables you to standardize on a chart
of accounts using value set mapping capabilities.

Value set maps enable Financial Consolidation Hub to automate the standardization of
data from multiple charts of accounts to a single consolidated chart of accounts. If your
organization uses a single global chart of accounts, you have one value set per
Enterprise Performance Foundation dimension and you do not need to create value set
maps. However, if you have multiple charts of accounts and consequently have
multiple Enterprise Performance Foundation dimension value sets, you must create
value set maps for each dimension that contains more than one Enterprise Performance
Foundation value set.

To create a value set map, use a WebADI spreadsheet loader to map the child display
code values to the values in the consolidation value set. You can also use the
spreadsheet loader to update existing value set maps. Mappings can only be within the
same dimension; you cannot map a value in one dimension to a value in another.
Therefore, you can only map values from a subsidiary's natural account dimension to
the parent's natural account dimension. You cannot map the subsidiary's natural
account dimension to the parent's line item dimension.

See: WebADI spreadsheets, page A-1

5-12 Oracle Financial Consolidation Hub User's Guide

During the Data Preparation step of the consolidation process, Financial Consolidation
Hub maps the source values into the specified parent values.

You can version value set mappings, for example to take reorganizations into account.
When you run consolidation, Financial Consolidation Hub applies the appropriate
version based on the effective date for which you are consolidating.

When you create a value set map, it creates a multi-value set dimension hierarchy in
Enterprise Performance Foundation. The dimension members in the consolidation
value set are the parents in the hierarchy and the members in the local value sets are
children under the member they map to.

Task 9: Line Item Intercompany Maps

Task 9 is only necessary if your source systems record intercompany transactions using
Line Item or Account dimensions. For Task 9, you can do the following:

• Create Line Item Intercompany Maps

• Update existing Line Item Intercompany Maps

You use these maps where you track some of your intercompany balances according to
particular line item values. A Line Item Intercompany Map specifies the relationship
between a line item value and an intercompany value in the consolidation chart of
accounts. You can map each line item value to an intercompany value or no value at all.

When you run consolidation, the application applies these mappings. During the Data
Preparation step of consolidation, if Financial Consolidation Hub finds any line items
for which there are line item intercompany maps, it will use the maps to repopulate the
intercompany value.

For example, a company can use the following line items to specify intercompany
transactions.

Account Intercompany Partner

I/C Accounts Payable None

I/C Accounts Payable - Canada Canada

I/C Accounts Payable - Mexico Mexico

You can define the following intercompany maps.

Setting Up Oracle Enterprise Performance Foundation 5-13

Line Item Dimension Intercompany

I/C Accounts Payable - Canada Canada

I/C Accounts Payable - Mexico Mexico

And the company has the following balances.

Company Line Item Intercompany Balance

Canada I/C Accounts Payable None 100

Canada I/C Accounts Payable

- Canada

Canada I/C Accounts Payable

- Mexico

Canada Cash None -600

None 200

None 300

When you run consolidation, the process will identify any matches for the line item
intercompany maps. It will then change the Intercompany value based on the maps.

Company Line Item Intercompany Balance

Canada I/C Accounts Payable None 100

Canada I/C Accounts Payable

- Canada

Canada I/C Accounts Payable

- Mexico

Canada 200

Mexico 300

Canada Cash None -600

You can create or update Line Item Intercompany Maps one at a time through the user
interface, or more than one at a time through a WebADI spreadsheet loader.

See: WebADI Spreadsheets, page A-1

5-14 Oracle Financial Consolidation Hub User's Guide

Task 10: Data Transformation and Validation

Task 10 is only necessary if you perform transformation or validation on your data
submissions and need to register additional tables and functions for the transformation
and validation rules. For Task 10, you can register any tables or functions you want to
use in Transformation Rule Sets and Validation Rule Sets. You can use these rules sets
to perform automated transformation and validation of balances during data
submission. You can register interface tables, lookup tables, and PL/SQL functions.

See: Transformation Rule Sets, page 14-10

See: Validation Rules Sets, page 14-10

Task 11: XML Publisher Templates

Task 11 is only necessary if you are changing the formats of the static reports you see in
Financial Consolidation Hub, or if those reports are very large.

For Task 11, set a maximum file size for synchronous publishing for the Consolidation
Trial Balance and Data Submission Trial Balance reports. If the report's file size is larger
than the designated maximum size, Financial Consolidation Hub launches the FCH:
Publishing Utility concurrent request to produce the report. You can then view the
output of the request to see the report. This prevents the Financial Consolidation Hub
user interface from timing out when the application production produces a large report.

You can also specify the XML Publisher templates you want to use for formatting
reports. Financial Consolidation Hub uses XML Publisher for ad-hoc reporting. XML
Publisher enables you to change the formatting of your reports by modifying them
using common desktop applications like Microsoft Word. For detailed information on
using XML Publisher, see Creating an RTF Template in the Oracle XML Publisher User's

Guide.

Financial Consolidation Hub provides the following report templates.

• A&D Trial Balance Template - To view the trial balance loaded for acquisition or
disposal purposes.

• Consolidation Entries Template - To view manual adjustments, consolidation
entries, and notifications.

• Consolidation Trial Balance Template - To view detailed consolidation worksheet
reports.

• Data Submission Data Loaded Template - To view each data loaded by each
submission.

• Data Submission Impacted Balances Template - To view balances in Enterprise
Performance Foundation that are impacted by new balances in Oracle General
Ledger.

Setting Up Oracle Enterprise Performance Foundation 5-15

• Data Submission Trial Balance Template - To view the current data in Enterprise
Performance Foundation for an entity. This may differ from the Data Submission
Load Data Template because it represents the cumulative effect of all data
submissions for a given entity in a given period.

• Hierarchy Listing Template - To view a consolidation hierarchy.

• Intercompany Matching Template - To view intercompany balances eliminated
during a consolidation run.

• Value Set Map Validation Template: To view the values mapped in an entity's local
chart of accounts to the consolidation chart of accounts.

• Write back to General Ledger Template: To view the balances of an adjustment
written back to Oracle General Ledger.

Note: You can use the default report templates as a baseline to create

reports with customized formatting, but you cannot modify the default
report templates.

See: Viewing Reports, page 18-1

Task 12: Setting Up Analytical Reporting

You must complete Task 12 before using analytical reporting. Task 12 enables you to
use and view your consolidated results in an OLAP environment.

Specify a data table in Enterprise Performance Foundation. This table is used as an
interface table to move consolidation results into analytical reporting. When you run
consolidation, the results are pushed into the data table. Analytical reporting can then
pull the consolidation results from the table.

Ensure that the data table is not being used by any other

Note:

applications.

Optionally specify a line item hierarchy in Enterprise Performance Foundation. If you
have Internal Controls Manager integration enabled, it will use this line item hierarchy.

See:Integrating with Internal Controls Manager, page 22-1.

You may also have to provide mappings between Financial Consolidation Hub and
analytical reporting. The Created by Object dimension is not supported in analytical
reporting. Thus, in Task 1, if you selected Created by Object column to be available as a
reporting dimension, you must now map to use for these columns. For example, map
the Object dimension to User-Defined Dimension 1 hierarchies should be created on the
user defined dimensions selected.

See: Setting Up Analytical Reporting, page 19-1.

5-16 Oracle Financial Consolidation Hub User's Guide

When you click Complete, Financial Consolidation Hub launches the FCH: Module
Initialization concurrent program. Monitor the concurrent program and verify that it
completes successfully.

Additional Setup Tasks

Once you complete Tasks 1-12, perform the following additional setup tasks.

1. Set default values in Enterprise Performance Foundation. Using the Enterprise

Performance Foundation Administrator responsibility, navigate to Configuration
Rules > Dimension > Definition. For each dimension that you set active in
Enterprise Performance Foundation in Task 1, assign a default member in each
value set of the consolidation chart of accounts.

2. Initialize Financial Consolidation Hub. Using the Consolidation Manager

Responsibility, navigate to Requests > Schedule Requests. Run the FCH: Module
Initialization concurrent program.

Using Oracle General Ledger with Oracle Enterprise Performance Foundation

Financial Consolidation Hub facilitates the synchronization of data from Oracle General
Ledger. This comprises the following setup components: ledger assignments, dimension
rules, hierarchy rules, and balances rules. For information on balances rules, see Setting
Up Data Submission for Oracle Entities, page 14-4.

To use Oracle General Ledger with Financial Consolidation Hub, you must perform the
following setup steps:

1. Configure the FEM_BALANCES table to be compatible with Oracle General Ledger

integration

2. Assign ledgers for analytic processing in Enterprise Performance Foundation

3. Define and run dimension rules

4.

Define and run calendar integration

5. Define and run hierarchy rules

6.

Define and run balances rules

To access the setup steps, select the Enterprise Performance Foundation Administrator
responsibility and navigate to the Data Rules tab.

Note:

For more information see the Oracle Enterprise Performance

Setting Up Oracle Enterprise Performance Foundation 5-17

Foundation User's Guide.

Financial Consolidation Hub recommends the following setup when leveraging the
Oracle General Ledger integration.

Configuring FEM_BALANCES for Oracle General Ledger Integration

To utilize integration with Oracle General Ledger, you must first configure and register
the FEM_BALANCES table in Enterprise Performance Foundation to be used for
integration.

1. In the Enterprise Performance Foundation responsibility, navigate to

Administration>Registration>Tables and Columns. Query for the table
FEM_BALANCES and click Update.

Click Save and Next multiple times to reach the step Table Classification.

2.

Move Oracle General Ledger from the Available Classifications region to the

3.

Selected Classifications region.

Note: If you do not see Oracle General Ledger in either region, click

Other Classifications. Expand Oracle General Ledger and have
your System Administrator perform the actions listed in the
expansion. After your System Administrator performs the actions,
Oracle General ledger should appear in one of the regions.

Ledger Assignments

To use a ledger from Oracle General Ledger in Enterprise Performance Foundation,
assign the ledger.

Defining Dimension Rules

Dimension rules define how General Ledger charts of accounts relate to Enterprise
Performance Foundation dimensions.

The General Ledger chart of accounts structure is segment based, whereas all data
stored in Enterprise Performance Foundation is dimension based. Before you transfer
General Ledger balances to Enterprise Performance Foundation, define all applicable
dimension values within the Enterprise Performance Foundation architecture using
account-based dimension and dimension hierarchy rules. These dimension rules map
the General Ledger chart of accounts segments to Enterprise Performance Foundation
dimensions. An account-based dimension rule specifies how a particular dimension in
Enterprise Performance Foundation is derived from the segments of a General Ledger
Chart of Accounts. Specifically, the account-based dimension rule specifies how

5-18 Oracle Financial Consolidation Hub User's Guide

dimension members are derived from segment values.

Setting Up Dimension Rules

Map each chart of accounts that you selected to be transferred to Enterprise
Performance Foundation to Enterprise Performance Foundation dimensions. You can
then synchronize segment values and hierarchies into Enterprise Performance
Foundation as dimension members and hierarchies. For each dimension within
Enterprise Performance Foundation, define and execute a mapping option. The
dimension mapping has the following options for each dimension:

• Copy Values from Single Segment

• Assign a Default Value

• Concatenate Values from Multiple Segments

Financial Consolidation Hub recommends particular consideration be given to the
mapping options for the dimensions listed in the following table.

Setting Up Oracle Enterprise Performance Foundation 5-19

Selected General Ledger Dimensions with Mapping Option Requirements

Dimension Description Financial Consolidation Hub

Requirements and
Recommendations

Company Cost Center
Organization

The Organization
dimension enables you to
copy values from a single
segment, either Company or
Cost Center, or the
combination.

You must map at least one
segment to the Organization
dimension. Although you can
combine the company and cost
center segments with the
Organization dimension.
Financial Consolidation Hub
recommends that you map the
company segment to the
Organization dimension and the
cost center segment to a
user-defined dimension for
reporting purposes.

Note: For Financial

Consolidation Hub purposes,
you must include the
company segment in the
mapping.

See: Setting Up Analytical
Reporting, page 19-1

5-20 Oracle Financial Consolidation Hub User's Guide

Dimension Description Financial Consolidation Hub

Requirements and
Recommendations

Intercompany The Intercompany mapping

depends upon the
Organization mapping.

Line Item The Line Item mapping can

copy values from a single
segment or concatenate up
to three segments.

If your chart of accounts has an
intercompany segment, assign
the intercompany segment to
the Intercompany dimension.

If you do not have a qualified
intercompany segment, then
assign a specific value.

Note: The intercompany

dimension can be populated
within Financial
Consolidation Hub using the
Line Item Intercompany
Maps functionality.

See: Task 9: Line Item
Intercompany Maps, page 5-13

Map the natural account
segment to the Line Item
dimension. Financial
Consolidation Hub
recommends concatenation of
segments to the Line Item
dimension only if you have
dependent segments on the
natural account segment.

Natural Account The Natural Account

mapping can copy a single
segment or concatenate up
to three segments.

Setting Up Oracle Enterprise Performance Foundation 5-21

Map the natural account
segment to the Natural Account
dimension. Financial
Consolidation Hub
recommends concatenation of
segments to the Natural
Account dimension only if you
have dependent segments on
the natural account segment.

Dimension Description Financial Consolidation Hub

Requirements and
Recommendations

Entity You can assign the Entity

Running Dimension Rules

After you define the dimension rules for a chart of accounts, run dimension rules to
automatically generate dimension values and value sets. To run the rules, click Submit
All Rules. It will launch the concurrent request Program- Enterprise Performance
Foundation General Ledger Dimension Rule Engine. The request will be run for each of
the dimensions in Enterprise Performance Foundation, including inactive ones.

If a dimension copies from one segment, the new value set is in the <OGL value
set>:DIM:<number> format. If a dimension copies from multiple segment, the new
value set is in the <OGL value set1> - <OGL value set 2>:DIM:<number> format .

dimension to a single value
or a single segment copy of
the balancing segment
value.

Note: If you are on

FEM.D.1, this dimension
will not be available for
mapping.

Assign the Entity dimension to
a single value if you want the
chart of accounts to be the
consolidation global value set
combination in Financial
Consolidation Hub.

After you run the dimension rules, you can transfer dimension hierarchies and balances
to Enterprise Performance Foundation.

You can also undo dimension integration. Delete or undo any associated dimension
hierarchies or balance transfers before you can undo dimension integration.

Note: Add the users running dimension member rules to the Default

and Data Integration folders.

Defining Dimension Hierarchy Rules

After segment values are linked to dimension members, you can transfer segment
hierarchies used in Oracle General Ledger to Enterprise Performance Foundation by
defining and running dimension hierarchy rules. Dimension hierarchy rules define
dimension hierarchies in Enterprise Performance Foundation, based on General Ledger
segment value hierarchies. Hierarchy rules apply only to dimensions that are related to
the General Ledger chart of accounts structure. Each hierarchy rule is based on a
particular dimension rule so the system can use the correct list of dimension members

5-22 Oracle Financial Consolidation Hub User's Guide

to construct the dimension hierarchy.

Financial Consolidation Hub enables you to define new hierarchy rules and new
dimension hierarchy rule versions. Definition of a new rule creates a new hierarchy
definition within Enterprise Performance Foundation. Creating a new version of the
rule creates a new hierarchy version within Enterprise Performance Foundation. When
you define the hierarchy rule, specify the top segment value. A hierarchy is available in
Enterprise Performance Foundation with the top segment values and all of its children.

Running Dimension Hierarchy Rules

Run dimension hierarchy rule versions to automatically generate dimension hierarchies
based on General Ledger segment value hierarchies. The selected hierarchy rule version
creates a dimension member hierarchy. The hierarchy name is in the format Hierarchy
for Rule <Hierarchy Rule>. To keep a version of the previous dimension hierarchy,
define a new dimension hierarchy rule version.

Note: Add the users running dimension hierarchy rules to the Default

and Data Integration folders.

Note: In Enterprise Performance Foundation Dimension hierarchies, a

value cannot have multiple parents. However, Oracle General Ledger
does not have this restriction in its hierarchies. Ensure that your
hierarchies in Oracle General Ledger do not have multiple parents
otherwise the dimension hierarchy integration will fail.

Calendar Period

You can synchronize your calendar definitions in Enterprise Performance Foundation
with Oracle General Ledger.

Setting Up Oracle Enterprise Performance Foundation 5-23

Overview

6

Setting Up Entities

Entities are designed to provide a flexible framework to separate and organize
operational data, consolidation processing, and consolidation results. Entities are the
building blocks used to construct consolidation hierarchies.

See: Setting Up Consolidation Hierarchies, page 13-2

The following entities are designed to easily organize operating, elimination, and
aggregation data for analysis and consolidated financial reporting:

• Operating entity

• Consolidation entity

• Elimination entity

Operating Entity

This entity contains operating balances that are loaded from General Ledger or other
financial systems using a data submission.

See: Submitting Data for Oracle Entities, page 14-6

Controlling Entity

This entity is an operating entity associated with a consolidation entity. The
consolidation entity-controlling entity relationship is not one of ownership; instead it
separates the consolidated data of a company from the operational data.

Consolidation Entity

This entity contains consolidated balances. A consolidation entity can own other
consolidation or operating entities, and aggregates its immediate children. Each

Setting Up Entities 6-1

consolidation entity includes a unique elimination entity and optionally a unique
controlling operating entity.

Elimination Entity

This entity holds entries and adjustments produced during the consolidation process. A
unique elimination entity is automatically created for each consolidation entity.

Example

In the following hierarchy, APAC and Subsidiaries is a consolidation entity. It has a
controlling entity, APAC HQ. The associated elimination entity is APAC Eliminations.
Japan is an operating entity.

Note: To create an elimination entity, create a consolidation entity and

specify the elimination entity's name during the creation process.

6-2 Oracle Financial Consolidation Hub User's Guide

Sample Consolidation Hierarchy

Entity in Enterprise Performance Foundation

When you create an entity in Financial Consolidation Hub, corresponding Enterprise
Performance Foundation structures are automatically created. An entity in Financial
Consolidation Hub corresponds to the same-named dimension member in the default
value set for the Entity dimension.

Note: An entity created in Financial Consolidation Hub has specific

parameters attached to it that you can view in Enterprise Performance
Foundation, but not vice versa.

A ledger is also created for the entity, with the name in the format <entity name> ledger.

Note: A ledger is not created for an entity in the case where the entity is

an operating entity that sources from Oracle General Ledger. In this
case, you will select an existing ledger to assign to the entity.

Setting Up Entities 6-3

Selected User Interface Elements for Setting Up Entities

The following sections describe Selected user interface elements.

Contact

The selected contact is the recipient of Workflow notifications related to the entity. This
leverages the role based model available in the Oracle User Management.

See: Oracle Applications System Administrator's Guide - Security

See: Impact Analysis, page 15-2

Secure by Role

If you select to secure by role, only the roles that you specify can access and update the
entity. If the entity is an operating entity, only the assigned roles can submit data and
adjustments for that entity. If the entity is a consolidation entity, only the assigned roles
can submit consolidations for that entity.

See: Role-Based Security, page 21-1

Image File

Enable Entity

Source System

You can upload an image file to represent the entity. The image file must be in GIF
format and be no larger than 16 x 16 pixels.

If you disable an entity, you cannot include the entity in new hierarchies. Disabling an
entity has no effect on an existing hierarchy where the entity is already included.

If you disable a consolidation entity's controlling entity, the

Note:

consolidation entity is treated as though it were disabled.

Note:

Once you disable an entity, you will not be able to re-enable it.

Select a source system for the operating entity. This is the system used for managing the
entity's operational activity and account balances throughout the accounting period.
Whether you select an Oracle General Ledger or a third party data source system, it
determines some of the fields that must be entered for the entity.

If you specify any additional data types, each additional data type can have a different

6-4 Oracle Financial Consolidation Hub User's Guide

Ledger

Balances Rule

source system.

Note: If the source system for actuals is not Oracle General Ledger, the

source systems for any additional data types cannot be Oracle General
Ledger.

To create an operating entity with an Oracle General Ledger source system, you must
select a ledger in Oracle General Ledger from which to pull balances.

To create an operating entity with an Oracle General Ledger source system, you must
select a Balances Rule to specify which balances are pulled from the ledger selected for
the entity.

If you specify additional data types, each additional data type can have a different
balances rule.

See: Setting Up Data Submission for Oracle Entities, page 14-4

Value Set Combination

To create an operating entity with a third party General Ledger source system, you
must select a value set combination based on the chart of accounts used in that source
system.

See: Task 4: Value Sets, page 5-8

If you specify additional data types, they will all use the same value set combination as
the one you specify for actuals.

Calendar Hierarchy

To create an operating entity with a third party General Ledger source system, you
must select a calendar hierarchy. The calendar hierarchy describes the periodicity of
data that you will load for the operating entity.

If you specify additional data types, they will all use the same calendar hierarchy as the
one you specify for actuals.

Functional Currency

To create an operating entity with a third party General Ledger source system, you
must select a functional currency for the entity. When you include an entity in a
hierarchy, it automatically defaults to this currency, but you can change the currency
within the hierarchy. The same defaulting behavior occurs for data submission.

Setting Up Entities 6-5

If you specify additional data types, they will all use the same functional currency as the
one you specify for actuals.

Note: You can load data in a currency that is different from the

functional currency, in case you are running translation on an external
system.

Transformation Rule Set

To create an operating entity with a third party General Ledger source system, you can
select a transformation rule set. A transformation rule set transforms the data when you
submit it.

If you specify additional data types, each additional data type can have a different
transformation rule set.

See: Transformation Rule Sets, page 14-10

Validation Rule Set

To create an operating entity with a third party General Ledger source system, you can
select a validation rule set. A validation rule set checks the data when you submit it.

If you specify additional data types, each additional data type can have a different
validation rule set.

See: Validation Rule Sets, page 14-10

Additional Data Types

To create an operating entity, set it up for actuals and averages data types. You can also
assign additional data types to an operating entity such as budgets. Additional data
types are set up in a similar manner to actuals and averages. You can run data
submission and consolidation for any data type assigned to an entity.

See: Task 4: Data Types, page 5-6

Company Values

To create an operating entity, select company values that the entity will represent. This
serves as the linkage between the company segment of General Ledger operational
balances and Financial Consolidation Hub entities.

Note:

You can use a company value in only one enabled entity. In order
to free a company value, you can remove it from an entity or disable
the entity or run the concurrent request FCH: Update Entity
Organizations.

6-6 Oracle Financial Consolidation Hub User's Guide

Each company can own multiple organizations that are used in account balances for the
entity.

Base Organization

To create an operating entity, select a base organization for the entity. The base
organization must be one of the organizations of the selected companies. The base
organization is used during consolidation processing as a default for automatic creation
of consolidation entries.

See: Minority Interest, page 7-3

Note: If you create an organization for an entity after the entity is

created, you must synchronize the organization assignments. To
synchronize, click Update for the entity.

If you do not see any organizations when you try to select a base

Note:

organization, verify that you have assigned companies to the entity and
that those companies have organizations assigned to them.

Elimination Entity

To create a consolidation entity, you must enter a unique name for the elimination
entity. The elimination entity is automatically created with that name.

Controlling Entity

To create a controlling entity, you can select an existing operating entity to be the
controlling entity for the consolidation entity.

Note: An operating entity can be the controlling entity of only one

consolidation entity.

Spreadsheet Loader

The spreadsheet loader enables you to create multiple entities at the same time.
Download a spreadsheet template, fill it out, and then upload it.

Note:

The first worksheet of the workbook corresponds to operating entities with third party
General Ledger source systems. The second sheet corresponds to operating entities with
Oracle General Ledger source systems. The third sheet corresponds to consolidation

The entity spreadsheet loader is not a WebADI spreadsheet.

Setting Up Entities 6-7

entities.

Note: You can create an operating entity and assign as a controlling

entity to a consolidation entity at the same time within the spreadsheet.

Note: The spreadsheet loader does not support adding additional data

types to entities. To add additional data types, update the entity
through the application.

If there are errors in the spreadsheet, the spreadsheet is rejected. All errors must be
corrected before you run spreadsheet loader. If the spreadsheet has no errors, it
launches the FCH: Load Entities concurrent request.

6-8 Oracle Financial Consolidation Hub User's Guide

Overview

7

Setting Up Categories

Categories control how a consolidation is processed and reported. They provide a
means of grouping process logic and specifying parameters impacting the output of
such logic. Customers can leverage categories to track and analyze their consolidated
results.

The following table shows seeded categories in a default sequence.

Seeded Categories

Default Sequence Category

1. Data Preparation

2. Intracompany

3. Translation

4. Intercompany

5. Acquisition and Disposal

6. Minority Interest

7. Aggregation

Setting Up Categories 7-1

User-Defined Categories

You can define categories as needed. The following situations illustrate scenarios where
you may choose to define categories:

• You need to adjust your investment in subsidiary accounts through the equity
method of accounting. In this case, for example, you can create a category called
Equity Pickup after the Translation category. If you need to reverse those
adjustments, you can create an additional category called Equity Pickup
Elimination and insert it after Minority Interest.

• You want to keep your adjustments separate from the operating balances imported
into Financial Consolidation Hub. In this case, for example, you might create a
category called Operating Adjustments after the Data Preparation category.

Category Definitions

This section describes the seeded categories.

Data Preparation

Data Preparation is the first category executed in the consolidation process. It prepares
operating data for consolidation by transforming the data to a standard consolidation
chart of accounts and calendar. Additionally, it aggregates data to the consolidation
processing dimensions in cases where consolidation processing does not use all the
dimensions of the submitted data.

Intracompany

During Data Preparation, if Financial Consolidation Hub determines that an operating
entity is using a global value set combination that is different from the consolidation
value set combination, it converts the entity's dimension values into its counterparts in
the consolidation value set combination. This conversion or mapping occurs
automatically.

See: Task 8: Value Set Maps, page 5-12

The Intracompany category eliminates balances from transactions that occur between
different organizations within an entity. The Intracompany category is always
sequenced before Translation.

To specify how intracompany balances are identified, select Yes or No in the Identify
Intracompany Transactions When They Differ From a Specific Value drop-down list.

The following table shows an example of how the option selected impacts
Intracompany. Assume that 00 is the constant value.

7-2 Oracle Financial Consolidation Hub User's Guide

Impact of the Selected Option on Intracompany Balance Identification

Option Selected OrganizationLine Item Intercompany

Organization

Only intercompany when
organization and Intercompany
are different.

Differ from Specific Value "00" 01 2300 01 Yes

01 2300 01 No

Intracompany
Transaction

Translation

Translation occurs after all categories that affect the child's balances are executed. The
Translation category picks up all data from a child entity and translates it to the parent's
currency. Translation only runs at points in the consolidation hierarchy where a child's
currency differs from that of its parent.

See: Translation Method, page 12-1

Intercompany

The Intercompany category eliminates balances from transactions that occur between
entities in the consolidation hierarchy. Eliminations are written to the elimination entity
of the first common parent in the consolidation hierarchy. The Intercompany category
can be placed anywhere after Translation.

See: Intercompany Rule, page 10-1

Acquisition and Disposal

The Acquisition and Disposal category enables users to automate accounting entries or
input manual entries as a result of acquisition and disposals.

See: Creating Consolidation Entries, page 17-4

Minority Interest

The Minority Interest category holds the consolidation accounting entries needed to
recognize non-controlling interest on consolidated financial statements. You can create
entries in the Minority Interest category by entering adjustments or by using
consolidation rules. The Minority Interest category can be placed anywhere after
Translation.

See: Consolidation Rule Steps, page 9-2

Setting Up Categories 7-3

Aggregation

The Aggregation category creates consolidated financial results for each consolidation
entity. It writes to the consolidation entity the summation of data for all children across
all categories. The Aggregation category always occurs last.

Selected User Interface Elements for Setting Up Categories

The following sections describes selected user interface elements for the Set Up
Category functionality.

Output Entity

An output entity is the target entity where the results of a consolidation rule or a
manual adjustment are written. The output entity can be the source entity, the parent
entity, or the elimination entity as follows:

• Source entity - The adjustment or entry updates the balances of the originating
entity. For example, operational adjustments that should be reflected on the entity's
operational books, but to be expedient, they are done in consolidation.

• Parent entity - The adjustment or entry updates the balances of the parent entity.
For example, equity pickup. The parent entity needs to write up or down its
investment in a subsidiary based on the subsidiary's profitability.

• Elimination entity - The adjustment or entry updates the balances of the elimination
entity, which does not affect the operational balances of any of the operating
entities. This is the case for most consolidation-only adjustments such as
intercompany eliminations and minority interest.

Note: Regardless of the output entity, balances are still segregated by

the Created By Object ID for auditing purposes.

All categories having the Output Entity field specified as source entity, must be placed
before the Translation category. This enables the Translation category to pick up all
operating entity data when it runs. All categories that have the Output Entity field
specified as elimination entity or associated parent must be placed after the Translation
category.

Track Each Child Separately

The Track Each Child Separately feature determines the granularity of a consolidation
rule output. If you select Yes, see the organization level granularity in the calculations.

See: Minority Interest, page 7-3

7-4 Oracle Financial Consolidation Hub User's Guide

Net to Retained Earnings at Year-End

The Net to Retained Earnings at Year-End feature determines whether year-end
processing should be applied to manual adjustments and consolidation rule entries for
this category. The default setting is No. If you select Yes for the Net to Retained
Earnings in the Year-End drop-down list, any income statement adjustments or
consolidation rule entries for the applicable category are closed to retained earnings
when crossing the fiscal year. This balance is added to the retained earnings balance for
all future periods. This balance is in addition to the balance determined by operating
balances and calculations.

Note: When the translation category nets to retained earnings at

year-end, it adds the balance to the retained earnings balance of the first
period of the next year, but not subsequent periods. Too propagate the
balance to future periods, you must include the balance in the
operating balances or calculations.

Reprocess for Multiple Parents

Certain formulas need to be recalculated each time the overall effective ownership of a
child changes. This occurs when a child is partially owned by multiple parents within a
consolidation hierarchy. Minority interest is a common example. A consolidation entity
may own 70% of a subsidiary, but the remaining 30% is owned by another entity within
the same hierarchy. While it is customary to recognize minority interest for the
consolidation entity which owns 70%, this minority interest needs to be backed out at
higher levels of the hierarchy in which the effective ownership of the subsidiary is
100%. For information on using this attribute for the multiple-parent scenario, see
Setting Up Consolidation Hierarchies, page 13-2.

Oracle General Ledger Category

Specify a category in Oracle General Ledger. If you perform write back to Oracle
General Ledger during an adjustment, it will write to the Oracle General Ledger
category specified in the Financial Consolidation Hub category of the adjustment.

See: Write back to General Ledger, page 16-6

Note:

You only need to specify an Oracle General Ledger category if
you plan to use the category for write back purposes. If you attempt to
write back and there is no Oracle General Ledger category specified,
write back will fail.

Setting Up Categories 7-5

Overview

Related Topics

8

Setting Up Consolidation Methods

A consolidation method is a mechanism that defines the accounting method applied
during consolidation. Consolidation rules are assigned to each consolidation method. A
consolidation method is assigned to each parent child/relationship within the
Consolidation Hierarchy user interface.

Setting Up Consolidation Hierarchies, page 13-2

Selected User Interface Elements for Setting Up Consolidation Methods, page 8-1

Selected User Interface Elements for Setting Up Consolidation Methods

Selected user interface elements are described below.

Consolidation Types

Consolidation types specify the method of consolidation. Financial Consolidation Hub
provides the following consolidation types:

• Full consolidation

• Proportional consolidation

• None consolidation

Full Consolidation - A consolidation method where 100% of the subsidiary's balances
are brought into the consolidated statements.

Proportional Consolidation - A consolidation method where a proportionate share of
the entity's balances are brought into the consolidated statements based on the

Setting Up Consolidation Methods 8-1

ownership percentage.

None Consolidation - A consolidation method where an entity's balances can be used as
input into a consolidation rule, but the entity's balances are not brought into the
consolidated statements.

Enable Consolidation Method

If you disable a consolidation method, you cannot use it to create new relationships in a
consolidation hierarchy but prior existing relationships are not affected.

Consolidation Rules Table

The consolidation rules table enables you to view all the consolidation rules assigned to
the consolidation method.

See: Setting Up Consolidation Rules, page 9-1

From Ownership (%)/To Ownership Percentage (%)

You can optionally specify an ownership percentage range for the consolidation
method. The consolidation method is automatically defaulted when the ownership
percentage falls within the range in creating a consolidation hierarchy. For example,
you can set up rules such that, by default, full consolidation is used for entities which
are majority owned and proportional consolidation is used for entities which are
20-50% owned. You can then override this, in specific cases, as needed. An example
would be where an entity is 45% owned, but you have effective control over it.

8-2 Oracle Financial Consolidation Hub User's Guide

Overview

9

Setting Up Consolidation Rules

A consolidation rule is a user-defined mechanism that enables you to automate the
creation of consolidation entries during consolidation processing. Typical examples of
entries generated by consolidation rules include the following:

• Minority interest

• Equity accounting

You can also use consolidation rules to calculate acquisition and disposal entries. This
chapter will focus on rules in the Minority Interest and User-Defined categories.
Acquisition and Disposal rules will be discussed in a later chapter. See: Creating
Consolidation Entries, page 17-4

Selected User Interface Elements for Setting Up Consolidation Rules

The following are selected user interface elements for setting up consolidation rules.

Category

Financial Consolidation Hub assigns a consolidation rule to a category. This determines
when to run the rule and where to write the results. The application runs consolidation
rules in the same category simultaneously. You can apply consolidation rules to the
Acquisition and Disposal, Minority Interest, and User-Defined categories.

See: Category Definitions, page 7-2

This section will focus on Minority Interest and User Defined categories. For
information on the Acquisition and Disposal category, see Creating Consolidation
Entries, page 17-4.

Setting Up Consolidation Rules 9-1

Enabled

If you disable a consolidation rule, the application does not apply the consolidation rule
during consolidation processing.

Consolidation Method

A consolidation rule is assigned to consolidation methods.

See: Overview, page 8-1

See: Selected User Interface Elements for Setting Up Consolidation Methods, page 8-1

From Method/To Method

If the consolidation rule is in the Acquisition and Disposal category, specify the original
and new consolidation methods. For information on acquisitions and disposals, see
Creating Consolidation Entries, page 17-4.

Consolidation Rule Steps

A consolidation rule contains one or more consolidation rule steps. A consolidation rule
step comprises a formula and a formula scope.

Formulas

Note: The sequencing of rule steps does not impact processing.

A formula is a combination of tokens and mathematical operators used to calculate the
balance of the consolidation entry. Tokens are variables whose values are resolved
during consolidation processing based upon the consolidation hierarchy. To create
formulas, you use the add (+), substract (-), multiply (*), divide (/), and parentheses [( )]
mathematical operators to group calculations in combination with tokens.

Financial Consolidation Hub provides 11 tokens. The tokens available for a
consolidation rule are determined by the category to which the rule is assigned. The
table below shows available tokens for the Minority Interest and User Defined
categories.

9-2 Oracle Financial Consolidation Hub User's Guide

Formula Scope

Source

Seeded Tokens Used with the Minority Interest and User-Defined Categories

Token Description

ELIMTB Elimination Entity Balances

CHILDTB Child Entity Balances

%OWN Ownership Percentage at Consolidation

%MI Minority Interest Ownership Percentage

The formula scope identifies the source and target accounts for the formula.

You can restrict source values by dimension. You can specify valid values from a list of
all possible values or from a hierarchy. Each account that meets the source requirements
is used in the calculation.

Target

You specify the dimension values of the account to which the consolidation entry is
written. For each dimension, the user specifies a specific value, otherwise the system
uses the same value as the source account.

Offset

You can specify an offset account if you did not specify the same as source option for
any target values. If you specify an offset account, then an offset balance is written to
the offset account to balance any consolidation entries created by the rule step.

Balancing a Consolidation Rule

Each consolidation rule is checked to see if it produces balanced entries. You can design
consolidation entries to balance or optionally use the offset functionality to
automatically balance the consolidation rule for you. If the consolidation rule is not
balanced, Financial Consolidation Hub uses the suspense handling defined for the
applicable consolidation hierarchy.

See: Setting Up Consolidation Hierarchies, page 13-2

See: Creating Consolidation Hierarchy Structures, page 13-6

Setting Up Consolidation Rules 9-3

Additional Data Types

By default, you can run consolidations on actuals and averages. In addition, you can
also run consolidations on any additional data type defined. During consolidation,
consolidation rules may or may not be executed depending on the definition of the data
type.

Related Topics

Task 4: Data Types, page 5-6

Examples of How Consolidation Rules Work

The following examples illustrates how consolidation rules are applied during a
consolidation process. The figure below illustrates the hierarchy for the examples.

The examples focus on Vision Consolidation Subsidiary and its subsidiary, Japan.
APAC and Subsidiaries has complete control over Japan, and so is fully consolidated.

9-4 Oracle Financial Consolidation Hub User's Guide

Sample Consolidation Hierarchy

Minority Interest

You want to calculate the minority interest for the relationship between APAC and
Subsidiaries and Japan. Since the relationship is a Full consolidation type, 100% of the
balances in Japan are aggregated to APAC and Subsidiaries. However, since APAC and
Subsidiaries only owns 80% of Japan, you want a resulting entry that removes 20% of
the profit of Japan.

Assume that the minority interest consolidation rule is in the minority interest category
that enables you to track each child separately functionality and writes to the
elimination entity. The following figure displays the rule.

Setting Up Consolidation Rules 9-5

Minority Interest Consolidation Rule

Note: The User Interface does not show all of the Source values. The

Source values chosen for Line Item are 4000 - Revenue and 5000 ­Expense.

The minority interest consolidation rule finds any balances in the source and
elimination entity whose Line Item is 4000-Revenue or 5000-Expense and creates a
consolidation entry that is equal to Minority Interest Ownership multiplied by those
balances. The consolidation entry is written to the specified account combination in the
elimination entity and an offset entry is written to balance the consolidation entry.

The company cost center organizations 11.100 and 11.200 are assigned to Japan and

11.100 is its base organization. APAC HQ, the controlling entity of APAC and
Subsidiaries has the base organization 12.100. Japan has the balances in the following
table. Assume these balances have already been translated into the parent currency,
USD.

Japan's Balances

Company Cost Center
Organization

11.100 1100-Cash 500

11.100 2100-Debt -200

11.200 3000-Equity -100

Line Item Balance

9-6 Oracle Financial Consolidation Hub User's Guide

Company Cost Center
Organization

11.200 4000-Revenue -500

11.100 5000-Expense 300

Line Item Balance

During consolidation, the consolidation rule produces the entry in the following table:

Entry Produced by Consolidation Rule

Company Cost Center
Organization

11.100 3600- Minority Interest B/S -40

11.100 5450- Minority Interest P/L 40

Line Item Balance

The consolidation rule identifies the balances with line items 4000-Revenue and
5000-Expense as source balances. The other balances in Japan are not identified as
sources because their line items are not included in the consolidation rule formula
scope. The consolidation rule produces a consolidation entry with Line Item
3650-Minority Interest B/S for the sources, whose value is: 0.2 * (-500 + 300)= -40.
Additionally, the consolidation rule produces an offset entry with Line Item
5345-Minority Interest P/L to balance the consolidation entry. The company cost center
organization of the entry is set to the base organization of the source entity, 11.100.

If Track Each Child separately was set to No for the category of the consolidation rule,
the consolidation entry would then use the base organization of the controlling entity,

12.100.

Track Each Child Set to No

Company Cost Center
Organization

12.100 3600-MI (Balance Sheet) -40

12.100 5300-MI (Profit and Loss) 40

Line Item Balance

In this case, you cannot tell if the source entity of the consolidation entry was Japan or
any other child entity of APAC and Subsidiaries

Setting Up Consolidation Rules 9-7

Eliminate Investment in Subsidiary

You want to eliminate APAC and Subsidiaries' Investment in Subsidiary for Japan.
Since the relationship is a Full consolidation type, 100% of the balances in Japan are
aggregated to APAC and Subsidiaries. However, since APAC and Subsidiaries already
records its Investment in Subsidiary for Japan, you want to reduce that investment
against Japan's equity in order to avoid double counting. Since APAC and Subsidiaries
only owns 80% of Japan, you only want to eliminate the portion of equity owned.

Assume that the equity accounting consolidation rule is in the equity accounting
category that enables you to track each child separately functionality and writes to the
elimination entity. The consolidation rule will have three steps.

Step 1: Eliminate Investment in Subsidiary

For simplicity, assume that APAC and Subsidiaries paid the market value for Japan.
Therefore, its investment in Japan is equal to Japan's equity times its ownership
percentage. To eliminate Investment in Subsidiary, we reduce APAC HQ's Investment
in Subsidiary by the amount of equity owned in Japan.

The rule step finds any balances in the source entity whose Line Item is 3000 - Equity
and creates a consolidation entry that is equal to the Percent Ownership multiplied by
those balances. The consolidation entry is written to the line item 1820 - Investment in
Subsidiaries.

9-8 Oracle Financial Consolidation Hub User's Guide

Step 2: Eliminate Subsidiary Equity

In step 2, the Japan's equity is eliminated. Since Japan is not fully owned, the portion of
equity not owned will be calculated in step 3. The rule step finds any balances in the
source entity whose Line Item is 3000 - Equity and creates a consolidation entry that is
equal to those balances. Since a target line item is not specified, the consolidation entry
is written to the same line item as the source, 3000 - Equity.

Setting Up Consolidation Rules 9-9

Step 3: Add Back Minority Equity

In step 2, all of Japan's equity was eliminated. Since Japan is not fully owned by APAC
and Subsidiaries, step 3 reduces that amount by the portion of equity not owned.

The rule step finds any balances in the source entity whose Line Item is 3000 - Equity
and creates a consolidation entry that is equal to the Minority Interest Ownership
multiplied by those balances. The consolidation entry is written to the line item 3650 ­Minority Interest (B/S) in the elimination entity.

The company cost center organizations 11.100 and 11.200 are assigned to Japan and

13.100 is its base organization. APAC HQ has the company cost center organizations

12.100 and 12.200 and has the base organization 12.100.

APAC HQ has the balances in the following table.

APAC HQ Balances

Company Cost Center Organization Line Item Balance

12.100 1100-Cash 400

12.100 1820 - Investment in
Subsidiaries

12.100 3000-Equity -700

12.100 4000-Revenue -500

400

9-10 Oracle Financial Consolidation Hub User's Guide

Company Cost Center Organization Line Item Balance

12.100 5000-Expense 400

Japan has the balances in the following table. Assume these balances have already been
translated into the parent currency, USD.

Japan's Balances

Company Cost Center Organization Line Item Balance

11.100 1100-Cash 500

11.100 2100-Debt -200

11.200 3000-Equity -500

11.200 4000-Revenue -100

11.100 5000-Expense 300

During consolidation, the consolidation rule will produce a consolidation entry in each
step.

Step 1: Eliminate Investment in Subsidiary

Company Cost Center
Organization

11.100 1820 - Investment in

Line Item Balance

-400

Subsidiaries

The step identifies the balance in Japan with line item 3000 - Equity as the source
balance. It produces a consolidation entry with Line Item 1820 - Investment in
Subsidiaries, whose value is: 0.8 * (-500) = -400. The company cost center organization of
the entry is set to the base organization of the source entity, 11.100.

Step 2: Eliminate Subsidiary Equity

Setting Up Consolidation Rules 9-11

Company Cost Center
Organization

11.100 3000 - Equity 500

Line Item Balance

The step identifies the balance in Japan with line item 3000 - Equity as the source
balance. It produces a consolidation entry with Line Item 3000 - Equity, whose value is:

-1 * (-500) = 500. The company cost center organization of the entry is set to the base
organization of the source entity, 11.100.

Step 3: Add Back Minority Equity

Company Cost Center
Organization

11.100 3650 – Minority Interest B/S -100

Line Item Balance

The step identifies the balance in Japan with line item 3000 - Equity as the source
balance. It produces a consolidation entry with Line Item 3650 – Minority Interest B/S,
whose value is: 0.2 * (-500) = -100. The company cost center organization of the entry is
set to the base organization of the source entity, 11.100.

The three consolidation entries produced have a total balance of: (-400) + 500 + (-100) =

0. They are thus balanced, and no suspense needs to be added.

9-12 Oracle Financial Consolidation Hub User's Guide

Overview

10

Setting Up Intercompany Rules

An intercompany rule is a mechanism that identifies intercompany activity to be
matched and eliminated. Intercompany rules are applied during both intercompany
and intracompany processing. During intracompany processing, rules eliminate activity
within an operating entity. During intercompany processing, the rules eliminate activity
between two entities.

You use intercompany rules to specify the following:

• Line items to match and eliminate

• Accounts to use when creating suspense entries for unbalanced eliminations

Related Topics

Matching

• A suspense threshold tolerance for unbalanced eliminations

An intercompany rule applies to all the consolidation hierarchies defined for your
instance. This eliminates the need to repeatedly define and assign identical
intercompany elimination rules to multiple hierarchies.

If an entity records intercompany balances through line item values rather than an
intercompany dimension, see Task 9: Line Item Intercompany Maps, page 5-13.

Intercompany Example, page 10-3

Matching, page 10-1

Suspense Handling, page 10-2

Matching is the process of grouping intercompany balances together to consider

Setting Up Intercompany Rules 10-1

whether the balances offset completely and therefore require a suspense entry for
balancing. You can do matching by Company pair or by Organization pair, as specified
in the Match Intercompany By drop-down list of the hierarchy.

Intercompany Elimination Entry

Intercompany elimination entries eliminate balances between entities to ensure that
they are not included in consolidated results. When matching balances are found, the
appropriate entries are created to eliminate the intercompany balances. The resulting
entry is made to the elimination entity of the first common parent entity of the two
entities.

To eliminate a balance under intercompany processing, entries must satisfy the
following:

• Contain a line item that is in an enabled intercompany rule

• Originate from an entity and counterparty entity, each of which have a path to a
common parent entity that does not include a consolidation type of None

Intracompany Elimination Entry

Intracompany elimination entries offset balances occurring between different business
units or companies within the same operating entity.

To eliminate a balance under intracompany processing, entries must be the following:

• A line item that is in an enabled intercompany rule

• From the same operating entity

Suspense Handling

When you define an intercompany rule, you specify a suspense account and a threshold
amount for suspense handling. Suspense handling refers to a balancing entry made to
the suspense account when balances to be eliminated do not offset completely.
Suspense handling writes to the suspense account of the receivables side entity.

Identification of balances for elimination during intracompany

Note:

processing is determined by an intracompany category setting.

See: Intracompany, page 7-2

Note:

A balancing entry is written to the suspense account for any out
of balance amounts, whether or not they exceed the user-specified
threshold amount.

10-2 Oracle Financial Consolidation Hub User's Guide

If the out of balance amount exceeds the threshold amount specified in the
intercompany elimination rule, a warning is generated, but the consolidation is allowed
to continue. You can inspect the entries in the Consolidation Process Status page and
make appropriate adjustments if necessary.

Additional Data Types

By default, you can run consolidations on actuals and averages. In addition, you can
also run consolidations on any additional data type defined. During consolidation,
intercompany eliminations may or may not be executed depending on the definition of
the data type.

See: Task 4: Data Types, page 5-6

Example of How an Intercompany Rule Works

The following example illustrates how intercompany rules are applied during a
consolidation process. The following figure illustrates the hierarchy for the example.

The following figure illustrates a consolidation hierarchy with its various entities.

Setting Up Intercompany Rules 10-3

Sample Consolidation Hierarchy

Eliminate Receivables Against Payables

You want to eliminate intercompany transactions between accounts payable and
accounts receivable.

This example focuses on transactions between Services and UK. Assume the conversion
rate from GBP to USD is 2.

Note:

Intercompany eliminations always occur in the currency of the
common parent.

The following intercompany rule eliminates intercompany transactions between
Accounts Receivable and Accounts Payable. Assume the hierarchy option, Match
Intercompany by, is Company. Also assume the intracompany option, Identify Balances
When They Differ from a Specific Value, is set to Yes, 00.

10-4 Oracle Financial Consolidation Hub User's Guide

The intercompany rule looks for balances that contain the line items 1200 – Accounts
Receivable, 2200 – Accounts Payable or 2210 – Accounts Payable Discounts, and whose
intercompany value differs from 00.

Services is assigned to the companies 3 and 4, which are assigned to the organizations

3.100, 3.200, 4.100 and 4.200. UK is assigned to company 9, which is assigned to the
organizations 9.100 and 9.200.

Services has the following balances in USD.

Submitted Balances

Balance Organization Line Item Intercompany Debits Credits

S1 3.100 1100 – Cash and Cash

Equivalents

S2 3.100 2200 – Accounts Payable 00

S3 3.100 2200 – Accounts Payable 9.100

S4 3.200 2210 – Accounts Payable

Discounts

9.100 2350

9.100









Setting Up Intercompany Rules 10-5

100

300

1500

Balance Organization Line Item Intercompany Debits Credits

S5 4.100 2200 – Accounts Payable 9.100



450

UK has the following balances in GBP.

Balance Organization Line Item Intercompany Debits Credits

U1 9.100 2200 – Accounts Payable 00

U2 9.100 1200 – Accounts

Receivable

U3 9.100 1200 – Accounts

Receivable

3.100 900

4.100 200



1100





Services and UK have the intercompany eliminations performed at the level of the
common parent, Global and Subsidiaries. The entities' balances are converted to the
common parent currency, USD.

Services' balances are already in USD. UK's balances are converted to USD. As specified
before, the conversion rate is 2.

Balance Organization Line Item IntercompanyDebits Credits

U1 9.100 2200 – Accounts

Payable

U2 9.100 1200 – Accounts

Receivable

U3 9.100 1200 – Accounts

Receivable

00

3.100 1800

4.100 400



2200





Intercompany eliminations will only be performed for balances whose line items are
1200 – Accounts Receivable, 2200 – Accounts Payable or 2210 – Accounts Payable
Discounts, and whose intercompany value differs from 00. Balances S3, S4, S5, U2, and
U3 meet this criteria.

The eliminations will be written to the elimination entity of the common parent. The
eliminations will write to the same account, except reverse the debits and credits. The
eliminations will also be grouped according to company pairs. In this example, the pairs

10-6 Oracle Financial Consolidation Hub User's Guide

are 3 – 9 and 4 – 9. Each grouping is balanced using the suspense account.

Here are the intercompany entries produced.

Intercompany entry: Companies 3 and 9

Organization Line Item Intercompany Debits Credits

3.100 2200 – Accounts
Payable

3.200 2210 – Accounts
Payable Discounts

9.100 1200 – Accounts
Receivable

9.100 300

9.100 1500

3.100







1800

The entry is balanced, so no balance is written to the suspense account.

Intercompany entry: Companies 4 and 9

Organization Line Item Intercompany Debits Credits

4.100 2200 – Accounts
Payable

9.100 1200 – Accounts
Receivable

9.100 450

4.100





400

9.100 3201 – AR/AP
Suspense

4.100



50

The entry is balanced by writing -50 USD to the designated suspense account in the
organization of the receivables entity. Since the suspense balance is below the threshold
amount of 100 USD, the entry will not produce a warning during consolidation.

Match by Organization

If the consolidation hierarchy option Match by Org was set to Organization instead of
Company, the intercompany elimination entries produced would be different. In this
case, the eliminations would be grouped according to organization pairs: 3.100 – 9.100,

3.200 – 9.100, 4.100 – 9.100.

Setting Up Intercompany Rules 10-7

Intercompany entry: Organizations 3.100 and 9.100

OrganizationLine Item Intercompany Debits Credits

3.100 2200 – Accounts Payable 9.100 300

9.100 1200 – Accounts Receivable 3.100

9.100 3201 – AR/AP Suspense 3.100 1500





1800



The entry is balanced by writing 1500 USD to the designated suspense account in the
organization of the receivables entity. Since the suspense balance is above the threshold
amount of 100 USD, the entry will produce a warning during consolidation.

Intercompany entry: Organizations 3.200 and 9.100

Organization Line Item Intercompany Debits Credits

3.200 2210 – Accounts
Payable Discounts

3.200 3201 – AR/AP
Suspense

9.100 1500

9.100





1500

A suspense of -1500 USD is written to the organization of the receivables entity. The
suspense is above the threshold value and will cause a warning during consolidation.

Note: An Intercompany elimination is performed even if balances are

not found on one side of the transaction. Also, in the event that there
are no balances on the receivables side, suspense is written to the
payables entity.

Intercompany entry: Organizations 4.100 and 9.100

Organization Line Item Intercompany Debits Credits

4.100 2200 – Accounts
Payable

10-8 Oracle Financial Consolidation Hub User's Guide

9.100 450



Organization Line Item Intercompany Debits Credits

9.100 1200 – Accounts
Receivable

9.100 3201 – AR/AP
Suspense

4.100

4.100





400

50

The entry is balanced by writing -50 USD to the designated suspense account in the
organization of the receivables entity. Since the suspense balance is below the threshold
amount of 100 USD, the entry will not produce a warning during consolidation.

Setting Up Intercompany Rules 10-9

Overview

11

Setting Up Calendar Maps

A calendar map is a user-defined mechanism that defines the relationship between the
periods of two different calendars. The calendar map is used during consolidation
processing when the operating entity calendar is different from the consolidation
hierarchy calendar.

You assign each consolidation hierarchy a consolidation calendar. If an operational
entity has trial balances based on a different calendar, you define a calendar map to
relate the two calendars.

You define a calendar map between the periods in a source calendar and a target
calendar. A period represents a range of time, such as month, quarter, or year. A
calendar map is defined for the first year and then used for all subsequent years. You
can map multiple source periods into the same target period.

You define a calendar map for the first year and Financial Consolidation Hub
extrapolates the appropriate mapping for subsequent years.

Mapping Example

Suppose that an operating entity uses a 13 period monthly fiscal calendar, while
consolidation results are in a standard 12 period monthly accounting calendar. You can
define a calendar map to convert the fiscal calendar to the accounting calendar.

The fiscal calendar, Fiscal, has the following format for 2004. Each year follows the same
pattern.

Period Name Data Range

Apr-04 Apr 2, 2003 to Apr 30, 2003

Setting Up Calendar Maps 11-1

Period Name Data Range

May-04 May 1, 2003 to May 31, 2003

Jun-04 June 1, 2003 to June 30, 2003

Jul-04 July 1, 2003 to July 31, 2003

Aug-04 August 1, 2003 to August 31, 2003

Sep-04 September 1, 2003 to September 30, 2003

Oct-04 October 1, 2003 to October 31, 2003

Nov-04 November 1, 2003 to November 30, 2003

Dec-04 December 1, 2003 to December 31, 2003

Jan-04 January 1, 2004 to January 31, 2004

Feb-04 February 1, 2004 to February 28, 2004

Mar-04 March 1, 2004 to March 31, 2004

Adj-04 March 31, 2004 to March 31, 2004

The accounting calendar, Accounting, has the following format for 2004. Each year
follows the same pattern.

Period Name Data Range

Jan-04 January 1, 2004 to January 31, 2004

Feb-04 February 1, 2004 to February 28, 2004

Mar-04 March 1, 2004 to March 31, 2004

Apr-04 Apr 1, 2004 to Apr 30, 2004

May-04 May 1, 2004 to May 31, 2004

11-2 Oracle Financial Consolidation Hub User's Guide

Period Name Data Range

Jun-04 June 1, 2004 to June 30, 2004

Jul-04 July 1, 2004 to July 31, 2004

Aug-04 August 1, 2004 to August 31, 2004

Sep-04 September 1, 2004 to September 30, 2004

Oct-04 October 1, 2004 to October 31, 2004

Nov-04 November 1, 2004 to November 30, 2004

Dec-04 December 1, 2004 to December 31, 2004

In Financial Consolidation Hub, the calendar map would look like the following figure.

The periods are mapped according to their date ranges. For example, Apr-04 in the
fiscal calendar and Apr-03 in the accounting calendar both represent the date range Apr
01, 2003 to Apr 30, 2003. Also notice that the fiscal calendar periods Mar-04 and Adj-04
(the adjustment period) have both been mapped to Mar-04 in the accounting calendar.

Setting Up Calendar Maps 11-3

Overview

12

Setting Up Translation

Different entities can operate in different currencies, but for consolidation purposes, it is
critical to standardize to a common currency. During consolidation processing,
Financial Consolidation Hub automatically translates any entity's balances from the
child's currency to the parent's currency if the two currencies are different.

Translation is applied according to the rules specified in a translation method. You can
define as many translation methods as needed due to differences in translation practices
across different industries, countries, or ownership relationships.

Note: Financial Consolidation Hub translation methods address both

translation and remeasurement in accordance with FAS 52 and IAS 21.

Translation Method

A translation method is a collection of settings that determines the currency processing
that is applied to a parent/child relationship during consolidation.

Translation methods include settings for the following:

• Equity translation method

• Income statement translation method

• Translation adjustment account

• Ending rate type

• Average rate type

Setting Up Translation 12-1

Assigning Translation Methods

You assign translation methods at the level of the relationship between two entities.
When you create or update a consolidation hierarchy, specify a translation method for
any child entity whose currency differs from its parent's currency.

See: Creating Consolidation Hierarchy Structures, page 13-6

Note: Once a relationship is part of a consolidation process, the

translation method can no longer be updated.

Selected User Interface Elements for Setting Up Translation Methods

Selected user interface elements are described below.

Ending Rate Type and Average Rate Type

Ending rates are generally used to translate balance sheet accounts. Average rates are
generally used to translate income statement accounts. Since Oracle Applications offer
the ability to enter multiple conversion rates for a given currency pair, specify which
conversion rate type to use for ending rates and which types to use for average rates.
Common examples of rate types are Corporate and Spot, though you can define
additional rate types as needed. You should have rate types which represent the ending
and average rates needed for translation.

Equity Mode

See: Currency Rates Manager, Oracle General Ledger User Guide

You can specify whether you want Financial Consolidation Hub to use the Year-to-Date
(YTD) balances or period activity (PTD) to translate equity accounts, such as retained
earnings and other equity accounts.

A YTD specification translates ending balances using the ending rate. The period
activity is then calculated from the difference between the current period's ending
balance and prior period's ending balance.

A PTD specification translates current period activity using the average rate. The
ending balance is then calculated by summing the translated period activity and the
prior period's ending translated balance.

The most common option in accordance with FAS 52 and IAS 21 is to use the YTD
option for equity accounts.

Note:

Regardless of the equity mode you choose, if you enter an
historical rate or amount for a given equity account, Financial
Consolidation Hub translates that account using the historical rate or

12-2 Oracle Financial Consolidation Hub User's Guide

Income Statement Mode

You can specify whether you want Financial Consolidation Hub to use the YTD or PTD
to translate income statement account balances.

A YTD specification translates ending balances using the ending rate. The period
activity is then calculated from the difference between the current period's ending
balance and the prior period's ending balance

A PTD specification translates current period activity using the average rate. The
ending balance is then calculated by summing the translated period activity and the
prior period's translated ending balance.

The most common option in accordance with FAS 52 and IAS 21 is to use the PTD
option for income statement accounts.

amount. Historical rates or amounts thus override ending and average
rates.

Note: Regardless of the income statement mode you choose, if you

enter an historical rate or amount for a given income statement account,
Financial Consolidation Hub translates that account using the historical
rate or amount. Historical rates or amounts thus override ending and
average rates.

Use as Default

You can designate a translation method as the default by selecting an option from the
Use as Default drop-down list in the Create Translation Method page.

When you construct a consolidation hierarchy, the default translation method is
automatically assigned to the relationship attributes between a consolidation entity and
its child operating entities. You can change the default translation method.

Enable Translation Method

If you select No from the Enable Translation Method drop-down list in the Create
Translation Method page, the translation method you defined is unavailable when you
create a consolidation hierarchy. If a translation method is disabled, it can no longer be
used in the construction of a new consolidation hierarchy.

Note:

A disabled translation method will continue to be used in
existing consolidation hierarchies that already include it and will
continue to be processed during the Consolidation Process.

Setting Up Translation 12-3

Entering Ending and Average Rates

Ending and average rates are exchange rates expressed in decimal form that are used to
translate the balances in one currency into another. Typically, ending rates apply to
balance sheet accounts. Average rates typically apply to income and expense accounts.

Note: Currency Rates Manager stores daily rates. When you run a

consolidation, Financial Consolidation Hub uses the rate assigned to
the last day of the period being processed.

You enter ending and average rates using Currency Rates Manager. To access Currency
Rates Manager, select the General Ledger SuperUser responsibility or have your System
Administrator add this functionality to any other responsibility. Navigate as follows:
Setup > Currencies > Currency Rates Manager.

To define rate types, select Rate Types from the menu to open the Rate Types page. To
define ending or average rates, select Daily Rates from the menu to open the Daily
Rates page.

See: Currency Rates Manager, Oracle General Ledger User Guide

Related Topics

Historical Rates, page 12-4

Historical Rates

Historical rates or historical amounts apply to a specific account and, if they exist, are
automatically used by Financial Consolidation Hub instead of the ending or average
rate. The historical rate or amount assignment is specific to an account associated with
an entity that is assigned to a consolidation hierarchy. Historical rates and amounts are
user-defined rates or amounts, generally for the following:

• Non-monetary assets

• Non-monetary liabilities

• Owner's equity accounts

• Revenues or expenses associated with non-monetary assets or liabilities

Non-monetary assets include both tangible items, such as land, and intangible items,
such as rights. They can also be associated with income statement accounts with a
non-monetary basis, such as Cost of Goods Sold and Depreciation. Non-monetary items
are not readily convertible to cash, hence their values are associated with their historical
worth.

12-4 Oracle Financial Consolidation Hub User's Guide

Defining Historical Rates

Before you run a consolidation process that uses historical rates, define historical rates
where applicable. You enter historical rates or amounts for specific combinations of
dimension values. The Historical Rates spreadsheet will show only the dimensions to be
used for Historical Rates. For example, you may have a line item called Land, which
you use to track the investment in land for each organization and/or entity. The
historical amount for land will likely vary from organization to organization based on
the value of the land, when it was acquired, and so on. You therefore enter a specific
historical rate for land for each relevant organization. During translation, Financial
Consolidation uses historical rates or amounts wherever they are defined. Thus,
historical rates or amounts override ending and average rates.

Selected User Interface Elements for Defining Historical Rates

Financial Consolidation Hub provides a WebADI spreadsheet loader for calculating
and entering historical rates. This interface is accessible from the Translation Rate Page.

Note: You can upload rates for multiple entities in a single workbook.

See: Appendix B: WebADI Spreadsheets, page A-1

For each combination of dimension members, enter either a historical rate or amount.
Historical rates are multiplied by the base currency balances to calculate translated
balances. Historical amounts are not multiplied; they are used as is. Rate Type defaults
to Historical and you should not change this when you are entering historical rates.

If you enter in a historical amount, the amount will be considered

Note:

a credit, not a debit.

If you enter a historical rate for an asset or liability account in one period, it is rolled
forward automatically to the next period with a rate type of Prior. Historical rates for
equity accounts are also rolled forward if the YTD specification is specified for the
Equity Mode. Thus, if you use the same historical rate throughout a year, you only need
to enter it once.

Financial Consolidation Hub automatically calculates a historical rate for retained
earnings accounts in the first period of each new year, based on the prior year's
profitability when you use the YTD specification for your equity accounts. These rates
are created with rate type Calculated.

You can update historical rates using the spreadsheet loader.

When you define a consolidation hierarchy, you define a specific dimension member
combination to use as the Retained Earnings account. Therefore, when you create
Historical Rates for the retained earnings of a consolidation hierarchy, the values you
can select for each dimension are limited by the Retained Earnings account you had

Setting Up Translation 12-5

specified for the hierarchy.

Translation Example

Vision: Canada uses Canadian Dollars (CAD) as its functional currency but consolidates
to Vision: North Americas Group which is based in USD. Thus, Financial Consolidation
Hub translates from CAD to USD during the consolidation process.

Vision: Canada is assigned a currency type of Translation, which uses an ending rate
type called Ending, an average rate type called Average, PTD mode for income
statements, and YTD mode for equity. It posts translation adjustments against the
Cumulative Translation Adjustment line item. The following table shows Vision:
Canada's trial balance for January 2005.

Vision: Canada's Trial Balance for January 2005

Entity Line Item Dr (CAD) Cr (CAD)

Vision: Canada Cash 1000 400

Vision: Canada Accounts Receivable 1200 500

Vision: Canada Accounts Payable 500 700

Vision: Canada Paid-in Capital 0 400

Vision: Canada Retained Earnings 0 300

Vision: Canada Revenue 0 2000

Vision: Canada Cost of Goods Sold 1100 0

Vision: Canada Salaries 400 0

The ending rate in January is 0.8. The average rate is 0.7. Since the translation method
uses YTD mode for equity accounts and PTD mode for income statement accounts,
Financial Consolidation Hub uses the ending rate for the balance sheet and the average
rate for the income statement. However, there is an historical rate of 0.84 for Retained
Earnings and Paid-in Capital, and this overrides the ending rate for those accounts. The
following table shows the rates used by translation for Vision: Canada.

12-6 Oracle Financial Consolidation Hub User's Guide

Rates Used by Translation for Vision: Canada

Entity Line Item Dr (CAD) Cr (CAD) Rate

Vision: Canada Cash 1000 400 0.8

Vision: Canada Accounts Receivable 1200 500 0.8

Vision: Canada Accounts Payable 500 700 0.8

Vision: Canada Paid-in Capital 0 400 0.84

Vision: Canada Retained Earnings 0 300 0.84

Vision: Canada Revenue 0 2000 0.7

Vision: Canada Cost of Goods Sold 1100 0 0.7

Vision: Canada Salaries 400 0 0.7

Since the balance sheet was multiplied by the ending rate and the income statement by
the average rate (and equities by an historical rate), the ending USD balances require a
credit of 58 posted to Cumulative Translation Adjustment to ensure proper balancing as
shown in the following table.

Translated Results for Vision: Canada

Entity Line Item Dr (CAD) Cr (CAD) Rate Dr (USD) Cr (USD)

Vision:
Canada

Vision:
Canada

Vision:
Canada

Vision:
Canada

Cash 1000 400 0.8 800 320

Accounts
Receivable

Accounts
Payable

Paid-in
Capital

1200 500 0.8 960 400

500 700 0.8 400 560

0 400 0.84 0 336

Setting Up Translation 12-7

Entity Line Item Dr (CAD) Cr (CAD) Rate Dr (USD) Cr (USD)

Vision:
Canada

Vision:
Canada

Vision:
Canada

Vision:
Canada

Vision:
Canada

Retained
Earnings

Revenue 0 2000 0.7 0 1400

Cost of
Goods Sold

Salaries 400 0 0.7 280 0

Cumulative
Translation
Adjustment

0 300 0.84 0 252

1100 0 0.7 770 0

0 0 N/A 0 58

In February, there is some activity, so you now look at both the PTD and YTD balances.

The following table shows the February trial balance for Vision: Canada.

Vision: Canada Trial Balance for February

Entity Line Item PTD Dr

(CAD)

Vision: Canada Cash 0 0 1000 400

Vision: Canada Accounts

Receivable

Vision: Canada Accounts

Payable

Vision: Canada Paid-in Capital 0 0 0 400

Vision: Canada Retained

Earnings

Vision: Canada Revenue 50 400 50 2400

200 0 1400 500

0 0 500 700

0 0 0 300

PTD Cr
(CAD)

YTD Dr
(CAD)

YTD Cr
(CAD)

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