In Oracle R12, Om improved the sales cost and revenue validation process

In Oracle R12, Om improved the sales cost and revenue validation process

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In general, according to the cost income validation principle, both income and sales costs must be recorded in the same period. In earlier versions, Oracle has no mandatory requirements for this. Cogs entries are generated before shipment, but the revenue is generated after invoice registration. Generally, the period from shipment to registration invoice is very short, therefore, cost and income are usually generated at the same time.
However, it may actually be that after the invoice is registered, it may not necessarily generate revenue (generally not recorded as income). In addition, after the goods are shipped, it may not be confirmed as the cost of sales (cogs) immediately. It may not be confirmed until the customer receives and accepts the goods.
Based on the above situation, R12 has made some adjustments to this revenue and cost validation process.
First, a new account is added, that is, deferred cogs account (deferred cost account), which is located under the other accounts of the Organization parameter. You may find that this setting also exists in 11, but it is gray in 11.

When will this subject play its role? When we finish shipping, we will produce in 11:
Borrow: Cogs
Loan: Sub-stock material cost
Note the following in 12:
Borrow: Deferred cogs
Loan: Sub-stock material cost
So when will deferred cogs be carried over to Cogs? Let's take a look.
In the following process, we will generate an invoice. How do we generate revenue entries when an invoice is generated? Speaking of this, R12 introduces a new process, and the settings in this process determine If revenue is generated. This process is called customer acceptance (accepted by the customer). The flowchart is as follows:

Customer Acceptance is actually your confirmation of your shipping goods, that is, the customer will confirm it by default (this is generally the case ), or you need to manually record the customer confirmation process (you can log on to the self-service interface by the customer or manually enter the confirmation information by the seller). The former is post-billing, the latter is called pre-billing, namely:

* Pre-billing: After So shipping, it must be accepted by the customer and then generated together with invoice and revenue.
* Post-billing: After So shipping, you can run invoicing immediately.ProgramIn this case, invoice and unearned revenue are generated, and revenue is generated after the customer accepts them.

We will discuss how to set the customer acceptance separately later.
Finally, run three requests:

* Record order management transactions-obtain transaction processing information
* Collect revenue recognition information-obtain income confirmation Information
* Generate cogs recognition event-carry forward deferred cogs to cogs

After running successfully, you can find the carry-over entry in material transaction.