Delloite Oracle Projects An Overview

Oracle Projects An Overview
Day 2
2006.Deloitte Consulting India Private Limited. All rights reserved.
Agenda
Overview Basic Concepts Process Flow Project Template and Project Budgets Agreement and Funding Cost Collection
Capitalization
Projects Billing Invoicing and Revenue Process Flow Billing and Revenue Generation Method
Billing Terminologies and Functionalities

Accounting Reporting
Cost Collection
Copyright 2006 Deloitte Development LLC. All rights reserved.
Expenditure Type Class

An Expenditure Type Class determines how an expenditure item will be processed by Oracle.
These are pre-defined by Oracle and cannot be added by the user:

Straight Time Overtime Expense Reports Usages Supplier Invoice Misc Transactions
Burden Transaction
Work In Process Inventory
Expenditure Type
Expenditure Type is an extension of Expenditure Type Class and is user defined.
Expenditure Type is used for reporting and accounting purposes.

Expenditure Type needs to be linked to one or more Exp Type Classes.
Exp Type Class

Straight Time
Exp Type
Regular Pay Bonus
Furniture & Fixtures Supplier Invoice Leasehold Improv.
Expenditure Type Setup
POET
POET refers to:
Project Number Organization (Expenditure) Expenditure Type
Task Number
Date (Expenditure) All project cost needs to have POET information. This may be entered manually by user (in Payables, Purchasing, Projects) or may be derived automatically by Oracle (in Inventory, WIP).
POET AP Invoice Distribution
Accounted vs. Unaccounted Cost

In Projects context, Accounted costs means costs for which accounting entry is already recorded in General Ledger (GL). Therefore, accounting will not be generated in Projects module. Accounting Entry will be generated in Projects for Unaccounted transactions and transferred to GL. This will be done using SubLedger Accounting in 12i.
Sources of Project Cost

Following are the main sources of project cost collection:
Payables: Accounted supplier invoices with POET information will be interfaced to Projects. Purchasing: POs and Requisitions will be interfaced as Commitments to Projects. When AP invoice is interfaced, requisition will be removed. Expense Reports: iExpense allows entry of Project related expense reports. Once reports are imported as invoice, these can be interfaced to Projects. Inventory and WIP: Accounted manufacturing cost will be interfaced if Project Manufacturing is used. WebADI: Accounted or Unaccounted costs can be uploaded directly into Projects using WebADI. Manual Exp Batch: Unaccounted pre-approved manual expenditure batches can be entered in Projects. Burden Cost: Cost collected as above can further be loaded with markup in Projects. This will create accounting for additional markup cost.
10
Supplier Invoice Cost Collection

Once a Supplier invoice is accounted in Payables, it can be collected immediately in Projects.
Program PRC: Interface Supplier Costs needs to be run to collect costs from Payables.
11
Cost Upload using WebADI

Oracle provides 4 different WebADI to upload unaccounted as well as accounted costs into Projects.
12
Manual Exp Batch

Manual Expenditure Batch can be entered for Timecards, Usage, Misc Transaction, etc.
After expenditure batch entry, following program needs to be run for generating cost and accounting:
PRC: Distribute Usage and Misc Costs (This will change depending on Exp Type Class entered) PRC: Generate Cost Accounting Events PRC: Create Accounting
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Manual Exp Batch - Header
14
Manual Exp Batch - Lines
15
Knowledge Check
16
Question 1
Q. What does POET stands for?
-----------------
17
Question 1
Q. What does POET stands for?
-----------------
Answer
Project Number
Organization (Expenditure)
Expenditure Type Task Number Date
18
Question 2
Q. Projects does not uses SubLedger Accounting (SLA) for creating accounting entry? o True o False
19
Question 2
Q. Projects does not uses SubLedger Accounting (SLA) for creating accounting entry? o True o False
Answer False, Projects uses SLA for creating accounting entry for unaccounted costs.
20
Cost Collection - Exercise

Upload a cost line using WebADI
21
Capitalization
22
Capitalization
Capitalization process can be done only for Capital projects. Capitalization process is very simple and completely integrated with Assets module. Put the Date Placed in Service and run following programs: PRC: Generate Asset Lines PRC: Interface Assets to Oracle Assets Above process will interface the data to Fixed Assets Interface, from where it can capitalized.
No Accounting is generated in Project module for capitalization process. Accounting will be generated in Assets module.
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Capitalization
24
Projects Billing
25
Projects Billing
Allows you to define revenue and invoicing rules for your projects, generate revenue, create invoices, and integrate with other Oracle Applications to process revenue and invoices. Enter project customers and contacts with whom you have negotiated and contracted project work Enter agreements (contracts) from your customers and fund projects with those agreements Generate revenue using various methods including time and materials, percent complete, and cost plus Create draft invoices from detail transactions and milestones for online approval by your project or accounting managers
Interface revenue to Oracle General Ledger and invoices to Oracle Receivables while maintaining a detail audit trail
Report project revenue, invoice, and receivables status online and in reports
26
Business Process
Customer
Contract/Account Manager Create Agreement
Project Manager Create Project Define Tasks, project and Task options, revenue and invoicing rules
Project Resources Enter Timecards, Expense Reports
Project Accountant Enter Usage and Miscellaneous expenses, import inventory and manufacturing costs
Awards Contract
Fund Projects
Enter Project Customer
Enter Cost and Revenue Budgets
Project Budgets
Project Costs
Accrue Revenue Project Accountant Print Invoices Generate Invoices
Interface Revenue to General Ledger
Interface to Accounts Receivables
27
Invoicing and Revenue Process Flow
28
Project Invoicing Flow

Generate Events on milestone
Start
Identify Milestone
Generate Draft Invoice
NO Review Draft Invoice Approve Invoice Run Cancel Draft Invoice
YES Approve & Release Invoice Run Interface Invoice to Receivables
Run Auto Invoice
Run Tie Back
End
29
Revenue Generation Flow

Generate Events on milestone Generate Draft Revenue
Start
Identify Milestone
Review the Revenue Generated
Release the Revenue
NO
Run Cancel Draft Revenue
YES Interface Revenue to GL
End
30
Billing and Revenue Generation Methods
31
Billing and Revenue Generation Method

Oracle Provides the following combination for Billing and Revenue Generation
Billing Method Cost/Cost Cost/Event Description Accrues revenue and bills using the ratio of actual cost to budgeted cost (percent complete) Accrues revenue using the ratio of actual cost to budgeted cost (percent complete) and bills based on events
Cost/Work
Event/Event Event/Work Work/Event Work/Work
Accrues revenue using the ratio of actual cost to budgeted cost (percent complete) and bills as work occurs
Accrues revenue and bills based on events Accrues revenue based on events and bills as work occurs Accrues revenue as work occurs and bills based on events Accrues revenue and bills as work occurs
32
Distribution Rule in Project Template
33
Distribution Rules Cost/Cost

Accrue on % Complete and Bill on % complete Actual Cost on a Project = $ 50,000 Budgeted Cost on a Project = $ 80,000 Budgeted Revenue on a Project = $ 120,000 Revenue = (50,000/80,000)*120,000 = $ 75,000 Billing = (50,000/80,000)*120,000 = $ 75,000
34
Distribution Rules Cost/Event

Accrue on % complete and Bill on events Actual Cost on a Project = $ 50,000 Budgeted Cost on a Project = $ 80,000 Budgeted Revenue on a Project = $ 120,000 Event created for $ 80,000 when actual cost reaches $ 50,000 Revenue = (50,000/80,000)*120,000 = $ 75,000 Billing = $ 80,000
35
Distribution Rules Cost/Work

Accrue on % complete and Bill as work occurs Actual Cost on a Project = $ 50,000 Budgeted Cost on a Project = $ 80,000 Budgeted Revenue on a Project = $ 120,000 Employee on a project A has worked for 100 hours. Billing rate for this employee is 650 Revenue = (50,000/80,000)*120,000 = $ 75,000 Billing = 650*100 = $ 65,000
36
Distribution Rules Event/Event

Accrue on events and bill on events Actual Cost on a Project = $ 50,000 Budgeted Cost on a Project = $ 80,000 Budgeted Revenue on a Project = $ 120,000 Event created for $ 80,000 when actual cost reaches $ 50,000 Revenue = $ 80,000 Billing = $ 80,000
37
Distribution Rules Event/Work

Accrue on events and bill as work occurs Actual Cost on a Project = $ 50,000 Budgeted Cost on a Project = $ 80,000 Budgeted Revenue on a Project = $ 120,000 Event created for $ 80,000 when actual cost reaches $ 50,000 Employee on a project A has worked for 100 hours. Billing rate for this employee is $ 650 per hour
Revenue = $ 80,000
Billing = $ 650 * 100 = $ 65,000
38
Distribution Rules Work/Event

Accrue as the work occurs and bill on events Actual Cost on a Project = $ 50,000 Budgeted Cost on a Project = $ 80,000 Budgeted Revenue on a Project = $ 120,000 Event created for $ 80,000 when actual cost reaches $ 50,000 Employee on a project A has worked for 100 hours. Cost rate for this employee is $ 450 per hour
Revenue = $ 450 * 100 = $ 45,000

Billing = $ 80,000
39
Distribution Rules Work/Work

Accrue as work occurs and bill on work occurs Actual Cost on a Project = $ 50,000 Budgeted Cost on a Project = $ 80,000 Budgeted Revenue on a Project = $ 120,000 Employee on a project A has worked for 100 hours. Cost rate for this employee is $ 450 per hour Billing rate for this employee is $ 650 per hour
Revenue = $ 450 * 100 = $ 45,000

Billing = $ 650 * 100 = $ 65,000
40
Knowledge Check
41
Question
Q. Which distribution rule combinations Oracle provides for Revenue and Invoice generation? -----------------
42
Question
Q. Which distribution rule combinations Oracle provides for Revenue and Invoice generation? -----------------
Answer
Cost/ Cost
Cost/ Event Cost/ Work Event/ Event
Event/ Work
Work/ Work Work/ Event
43
Billing Terminologies and Functionalities
44
Bill Rate
Bill rate is an amount or percentage that is applied to a unit (of time and materials) to calculate revenue and invoicing. Bill rates are used for time and materials projects. You can specify the following bill rates in Oracle Projects:
Employee Bill Rates: Standard hourly bill rates or percentage markups assigned to employees. You can assign a different bill rate to each employee for customer invoicing. Job Bill Rates: Standard hourly bill rates assigned by job title. For example, all System Administrators can have one bill rate, while all Consultants can have a different bill rate. NonLabor Bill Rates: Standard bill rates or standard markups assigned to nonlabor expenditure type or nonlabor resources.
45
Event
Signifies the occurrence of an event in the course of the project having a
revenue and/or invoice impact. Eg: A milestone, invoice reduction
Automatic Manual
46
Invoicing Terms
Bill Through Date: The date through which Oracle Projects picks up eventsand expenditure items to be billed on an invoice.
Invoice Date: The date that is printed on the invoice and the date on which an invoice receivables aging begins. You specify the invoice date when you generate the invoice.
Billing Cycle Code: The code that indicates when to generate invoices automatically a project; determined from the project. The bill cycle code is used only during mass invoice generation. First Bill Offset Days: The number of days that elapse between the project start date and the date of the projects first invoice; determined from the project. Bill offset days are used only during mass invoice generation. Invoice Currency: The invoice currency selected for the project customer. Invoice Transaction Type: If you choose decentralized invoice processing during implementation, this is the name of the organization that is the invoice processing organization for the project owning organization. Otherwise, this is the default transaction type of Projects Invoice or Projects Credit Memo based on the PROJECTS INVOICES batch source.
47
Invoice Generation
You can generate an invoice for a single project, or for all projects having potential invoices
For a single project, run PRC: Generate Draft Invoice process
Submit the PRC: Generate Draft Invoices for a Range of Projects in the Submit Request window to run multiple invoice generation processes in parallel.
When you generate an invoice, Oracle Projects first select projects, tasks, and their associated events and expenditure items that are eligible for billing Oracle Projects next creates invoice items for billing events, revenue events, and for expenditure items based on invoice formats defined for labor and nonlabor items. When Oracle Projects creates invoice items, it also searches for available funding for each invoice item.
48
Revenue & Invoice Accounting
49
Revenue and Invoice Accounting

Revenue and Invoice Accounts Function: When you run the PRC: Interface Revenue to General Ledger process and then the PRC: Interface Invoices to Receivables process, Oracle Projects uses the Revenue and Invoice Accounts function to determine which accounts to use when it interfaces draft revenue and draft invoices. The Revenue and Invoice Accounts function consists of the following transactions:
Unbilled Receivable Account Accounts Receivable Invoice Rounding Account Unearned Revenue Account Invoice WriteOff Account
50

Revenue Accrual prior to billing
Account Unbilled Receivables Revenue Debit 200 200 Credit
Invoicing prior to Revenue Accrual

Account Receivables Unearned Revenue Debit 200 200 Credit
51

Revenue Accrual prior to invoicing and invoice partial amount of work
Account Debit Credit 200
Unbilled Receivables
Revenue
200
Account
Receivables Unbilled Receivables
Debit
100
Credit
100
52

Invoicing prior to Revenue Accrual and later Accrue more than Invoice
Account Receivables Unearned Revenue
Debit 200
Credit 200
Account
Unearned Revenue Unbilled Receivables Revenue
Debit
200 100
Credit
300
53
Auto Accounting Rules
54
Auto Accounting Rules
55
Reporting
56
Project Status Inquiry

Oracle has provided many seeded reports and online forms for reporting purposes.
Project Status Inquiry screen is an online dashboard, which provides real time information on the cost, commitments, revenue, billing and budgets for one or multiple projects.
This form can be configured to meet complex requirement for online reporting. Custom SQLs can be written to derive any data. This form is refreshed each time PRC: Update Project Summary Amounts program is run.
57
Project Status Inquiry
58
End of Day 2
59

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Oracle Projects An Overview

2006.Deloitte Consulting India Private Limited. All rights reserved.

Billing Terminologies and Functionalities

2006.Deloitte Consulting India Private Limited. All rights reserved.

Copyright 2006 Deloitte Development LLC. All rights reserved.

Expenditure Type Class

These are pre-defined by Oracle and cannot be added by the user:

Copyright 2006 Deloitte Development LLC. All rights reserved.

Expenditure Type is used for reporting and accounting purposes.

Exp Type Class

Furniture & Fixtures Supplier Invoice Leasehold Improv.

Copyright 2006 Deloitte Development LLC. All rights reserved.

Expenditure Type Setup

Copyright 2006 Deloitte Development LLC. All rights reserved.

Project Number Organization (Expenditure) Expenditure Type

Copyright 2006 Deloitte Development LLC. All rights reserved.

POET AP Invoice Distribution

Copyright 2006 Deloitte Development LLC. All rights reserved.

Accounted vs. Unaccounted Cost

Copyright 2006 Deloitte Development LLC. All rights reserved.

Sources of Project Cost

Supplier Invoice Cost Collection

Copyright 2006 Deloitte Development LLC. All rights reserved.

Cost Upload using WebADI

Copyright 2006 Deloitte Development LLC. All rights reserved.

Manual Exp Batch

Copyright 2006 Deloitte Development LLC. All rights reserved.

Manual Exp Batch - Header

Copyright 2006 Deloitte Development LLC. All rights reserved.

Manual Exp Batch - Lines

Copyright 2006 Deloitte Development LLC. All rights reserved.

Copyright 2006 Deloitte Development LLC. All rights reserved.

Copyright 2006 Deloitte Development LLC. All rights reserved.

Copyright 2006 Deloitte Development LLC. All rights reserved.

Copyright 2006 Deloitte Development LLC. All rights reserved.

Copyright 2006 Deloitte Development LLC. All rights reserved.

Cost Collection - Exercise

Copyright 2006 Deloitte Development LLC. All rights reserved.

Copyright 2006 Deloitte Development LLC. All rights reserved.

Copyright 2006 Deloitte Development LLC. All rights reserved.

Copyright 2006 Deloitte Development LLC. All rights reserved.

Copyright 2006 Deloitte Development LLC. All rights reserved.

Copyright 2006 Deloitte Development LLC. All rights reserved.

Contract/Account Manager Create Agreement

Project Resources Enter Timecards, Expense Reports

Enter Project Customer

Enter Cost and Revenue Budgets

Accrue Revenue Project Accountant Print Invoices Generate Invoices

Interface Revenue to General Ledger

Interface to Accounts Receivables

Copyright 2006 Deloitte Development LLC. All rights reserved.

Invoicing and Revenue Process Flow

Copyright 2006 Deloitte Development LLC. All rights reserved.

Project Invoicing Flow

Generate Draft Invoice

NO Review Draft Invoice Approve Invoice Run Cancel Draft Invoice

YES Approve & Release Invoice Run Interface Invoice to Receivables

Run Auto Invoice

Run Tie Back

2006.Deloitte Consulting India Private Limited. All rights reserved.

Revenue Generation Flow

Review the Revenue Generated

Release the Revenue