Functional

The concept of multiple organisation or multi org is used in the release 11 and 12.

Index:

1. Introduction

2. Benefits

3. Multi Org structure in Release 11 and Release  12

4. Release 11 versus Release 12

5. Important points stated in the oracle user guide

6. Pre requisites  for setting up Multi org in Release 12

7. Setting up Multi org in Release 12

Introduction:

Multi – Org is a server side enhancement, which enables the multiple organizations (organisations having offices across the globe) in an enterprise to use a single installation of oracle applications products while keeping transacting data separate and secure. (in a single server)

Multi - Org is essential for large customers with multiple lines of business or divisions. It allows secure access to information and simplifies processing and reporting.

Example:

A client spread across Canada and UK, is moving its ERP to Oracle from a different ERP.

It would be a single installation of an oracle server and organisations are placed across the world. It gets integrated using a shared instance.  Using multi org we can have multiple organisations linked and separated through operating units.  Information could be in a shared mode and is secure - all in a single instance or server. Different organisations would be mapped to it.

Key Concepts:

Business Group:

It is the highest level (basically the HRMS) in the organisation structure, such as the consolidated enterprise or major division etc. It is a consolidated enterprise at the top level.

Example:

If a head quarter wants to have a shared payroll. There can be one business group across multiple ledger and legal entities respectively.

Multiple ledgers can share the same business group if they share the same business group attributes, including HR Flex field structures.

Normally the HR is shared across and called shared HR. In few cases, there are separate business groups.  Most cases there is one centralised company under which there are separate ledgers and legal entities mapped.  ( like a big umbrella)

We have the following under business group:

Ledger:

A ledger determines the currency, charts of accounts, accounting calendar, ledger processing options and sub ledger,   accounting method.  Ledger can be Primary and secondary.

Currency and calendar is new in R12.

Ledger deals with the movement of data into GL.

It is critical in configuration.

In the best scenario each country would have own its ledgers. Companies can share the same chart of account structure, but the reports have to be in their own currency (functional).

In case of UK the data would be reported in GBP, in US it would be USD. Therefore there should be a separate ledger for them.

Sub ledger accounting method is new in release 12. It is how the accounting convention has to take place. For e.g. standard accrual or cash based.  That can be defined and attached.

4 c’s are chart of account, currency and calendar and (conventions or accounting conventions. (it’s new in R12) or sub ledger accounting method.

If any one of the four changes a new ledger has to be defined.

There are two types of ledgers in oracle, one is primary and the other is secondary.  Primary is the main book of reporting. Secondary is optional it is required in cases where data is to be reported in a different currency. In is an important concept in the understanding prospective.

Ledgers are new in R 12 in the older version it is set of books or SOB.

Legal Entity:

Legal Entity is a Legal company for which the fiscal report or tax report is prepared.

Example if there is a separate tax registration for an organisation. That becomes a legal entity. It has its own registration a vat number or a sales tax number.

In 11 i it is referred as Government report entity or GRE. Tax reporting is prepared in a legal entity.

Operating Unit:

Operating unit is an organisation that uses Oracle Sub ledgers and related products.  They are sub ledger modules like AP, Accounts receivables, and accounts payable.   They work at the operating unit level. There could be multiple operating units assigned to a single entity, which is correspondingly linked to the ledger. Operating unit is where the operations are carried.  It could be AP or AR operations. It could be of a single country but could have multiple divisions with respect to the AP module so data is segregated by the AP module.  All sub ledgers use operating unit as the base to move on. So there could be an operating unit linked to the legal entity as well as a ledger and they could be logically associated so there could be multiple operating units under one ledger and legal entity combination. It is important in the sub ledger prospective.  Sub ledgers other than GL and fixed assets.  All other modules like AP and AR lock into the operating unit.  Each operating unit prepare their respective AP and AR.  

Anika Gupta

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