Questions & Answers:

1. Explain P2P cycle2. Explain O2C Cycle3. How do you create the COA?4. How do you create the Responsibilities?5. How do you create the Calendar?6. How do you create the Primary Ledger (PL)?7. How do you assign Profile option to Responsibilities?8. How Many type of currency Explain?9. How many Year types?10. How Many period Type?11. What is Functional currency Journal and Foreign currency journal?

!.Answers1.P2P Cycle

1 .P2P means procure to payment. In P2P cycle 3 modules are mainly involved.

a) Inventoryb) Purchase orderc) Account Payables

Inventory2. In every organization have inventory but incase items are available in Inventory it will go for requisitions. Basically Requisitions Have two types.i.) Internal requisition (It will go for purchasing another Operating unit under the Same Legal entity)ii)External Requisition( It will go for purchasing out of the Suppliers )3. For this External Requisition purpose Inventory go for Approval Basis to Higher authority.The Higher authority approved the Approval for External requisition.

Purchase Order4. Inventory will send this Information to Purchase Order Dept for Requisitions.5. Based on Requisitions Purchase Order will raise a RFQ’s (request for Quotations)

to the Suppliers.6. Quotations will be received from Suppliers.7. Based on Quotations PO analyze the Quotations i.e called as Quotation Analysis.8. Based on analysis PO will choose one Base Quotation from Suppliers Quotations.9. PO dept will send the PO Information to supplier.10. Receiving the goods from Supplier, and PO dept will create a GRN (goods receipt Note).11. This information will send to the higher authority and it will get approved from higher authority.

Account Payables12, Based on GRN Account Payables dept, will enter a Purchase Invoice.13. Against Purchase Invoice it will enter Payment.

Cash Management14. For Payment purpose AP will go to the CASH Management dept for reconciliation Payments with Bank Statemen ts.15. After Reconciled, CM will send the Information to AP dept,16. All the transactions information will transfer into GL.

Fixed Asset17. If any Assets purchase that assets information will transfer into FA dept.this is the P2P cycle according to my Knowledge

2 . O2C Cycle 1. O2C means order to Cash cycle, In O2C 3 dept have mainly involved, a) Inventory b) Order management c) Account receivables

Order Management: 2.If the OM dept receiving any Sales Order from the Customer, first it will go to the inventory and It will Check the Items are available OR not, if items are available, the OM will Book the Sales Order 3. After that Booking the Sales Order it will go for Pick releasing 4. Mainly Inventory has Sub-Inventory and Staging area,

Inventory: 5. The Items are moving from Sub-Inventory to Staging area is called as Pick release. 6. After pick releasing the OM will go for Ship Confirmation. 7. The items are transfer from Staging area to transferring vehicle is called as SHIP Confirm. 8. After ship confirm the OM will enter one Delivering Receipt at the time of Ship confirm.

Account Receivables 9. Based on Receipt note, Account receivables will enter one Sales Invoice. 10. Against sales invoice AR will prepare one receivable Note. 11.AR will go for reconciliation to the CM.

Cash management: 12. CM will reconcile the Receivables with Bank Statements. 13. After reconciling this Information will transfer into AR,

General Ledger: 14. All these Transactions Information will transfer into the GL. this is O2C cycle.

3. COAmainly we have 4 C’s.CalendarCurrencyChart of Accounts.( GL Org. structure SegmentsValue set values)Sub-Ledger Accounting Method.This is one of the 4C’s.Navigation: Setup Financials Flex FieldsKey Segmentswhen you click on Segments, Key flex field window will be open, here we have one short

cut key (CTRL+F11) by using this the window filled with Application, Title, And Structures (by Creating someone), 2. You can give new Structure, put on curser at existing structure, Click on (CTRL+ down Arrow). And enter NEW structure, you will create CODE, system will automatically taken code as title.3. In this window we have SEGMENTS button, click on Segments, the Segments Summary window will be open, and enter Segments name(Company, Accounts), the system will be

taken name as Window prompt, Select Segments number( because basically under Accounting Key Flex Field we can enter Maximum 30 Segments, and minimum 2 Segments),

4. For Each Segment required Numbering for that purpose we will create Value set, 5.In segments Summary window Value set Button is there, click on Value set, the value set firm will be open.Enter value set name (Company, Account), Enter maximum size of Segment values (3,4……..), enable Right Justifying Zero Numbers (00001).6. Assign that value set to Each Segments,7. Under account Key Flex field, we have Two types of Qualifiers is therei. Flex Field Qualifiers: It will use for Segmentsii. Segment Qualifiers: it will use for Segment values.8. For each Segment required flex Field Qualifiers it have 6 typesI . Balancing Segment FFQii. Natural Account Segment FFQiii. Cost Center Segment FFQiv. Secondary Tracking FFQv. Inter Company Account Segment FFQvi. Managing segment FFQ.By out of these six Two FF are mandatory* Balancing Segment FFQ ( It’s for Company segment)*Natural Account Segment FFQ( It’s for Account Segment)9.Put on curser Particular Segment, Click on Flex field Qualifiers in Segments summary window. For each segment you click on save.10. Go to structure window Enable Freeze Flex field definition (it’s for protecting the our Structure, and we can’t change any information after this enabled). When you enable this check box, the compile button automatically displayed.11. Click on Compile. Close the windowDefine Segment Values for segmentsNavigation: Setup Financials Flex fields Key values12. Click on Values, the Key Flex field find firm will be open and you select Application (GL), Title (AFF), Structure (xxx), Segment (company, Account), click on find.13. Here you have two tabs, In Values tab enter Segment values for Company Segment, click on Qualifiers tab you can Select Segment Qualifiers for Company segment basically Segment Qualifiers are 5 types a ) Allow budgeting b) Allow Posting c) Account type d) Third Party control account

e) Reconcile14. For company Segment has only Two Qualifiers are using i. Allow budgeting ii. Allow Posting if you allow this you say (yes), 15. For Account Segment the all Qualifiers are opened Account type having 5 types a) Expense b) Revenue c) Assets d) Liability e) ownership/standardyou can select Account as retained earnings the qualifier is (ownership) save this window and close it.

4. Responsibilitieswhen you go to Switch Responsibility( File Switch Responsibility)Select System AdministratorDefine ResponsibilitiesNavigation: Security ResponsibilitiesDefine1.click on Define, the Responsibilities firm will be open2.Enter Responsibilities name( xxx General Ledger), Select Application( General Ledger), Enter Responsibility Key( xxx_ GL) it will use for Technical People,3.Select Standard data( name, Application), 4. Select Main Menu (it’s giving the Features for particular responsibilities) GL_SUPER USER5. Select Concurrent program (GL concurrent Program)Save it firm.

5 . Calendar Before creating calendar, first we have create Pre-define (period type,).Navigation: Setupfinancials Calendar Type1. Enter period type name (xxx_Acc_cal), Enter year, year type (fiscal year, Calendar Year), number of periods, select Period type (weekly, quarterly, monthly, daily, half yearly), and Save it firm2. Define calendarNavigation: Setup Financials Calendar Accounting1. Enter calendar name (xxx_cal),2. Select Prefix (based on Year type), Select period type, enter year, Enter Quarter num. Number, Select FROM- TO , System will taken prefix as name,

3. If you want adjustment Period, Enter Adjustment as prefix, and enable the Adjustment checkbox.

6. Primary ledger

By using Calendar, Currency, COA we will prepare Primary Ledger. In PL we are recording the Day to day transactions.Define Pl we go to the navigationNavigation: Setup FinancialsAccounting Setup Manager Accounting Setupwhen you click on Accounting setup, it will open one WEB Page,1. Click on Create accounting setup For New creating PL,2. if you have existing Pl, in this same window Search field is there, search (xxx%), click on Go the existed PL will Be Open.Click on NEXT, 3. Here we enter the PL name (xxx Pl), Select COA, CALENDAR, CURRENCY, click on NEXTclick on FINISH, after finishing you get one Confirmation Message, and you click on Reporting Accounting setup .4. By Search option you go to the PL, click on GOGo to Ledger Setup StepsHere we have 5 step’s I. Ledger optionsii. Reporting Currencyiii. Balancing Segment valuesIV. Sub- ledger accounting optionsv .Sequencing5. click on Update button against Ledger Options, click on next, Here select retained earnings Code combination, here one window will be open , search the codes, and click on Create( if this not Displayed, go to Structure window, Enable Allow Dynamic Inserts) Click on Select, Click on Finish.You go to setup steps the ledger options status will added green color right mark .6. Click on update against reporting currency, Click on Complete7. Every Organization registered at govt. The registration information is called as Legal entity.8. Create legal entity, Go to Structure window, Click on Legal Entity (tab),click on Create Legal Entity, Enter Territory, Legal entity name, Organization name, EMI Num, Pan num,click on Create New address, Enter Location, address 1click on Apply9. Go to Structure window, Search it, And Click on Add Legal entity, select the Legal

entity,When assign the LE to Primary ledger, the System will added one operating unit in Primary Ledger setup steps.10. You will assign BSV’s into Legal entity, Click on Update, Select BSV’s after you Assign BSV’s at Legal Entity, the Status will comes into against PL BSV’sand the System will added Intercompany accounts after assign BSV’s Into LE .11. Click on Update Against Operating Unit, Click on Complete,12. Click on Update against Intercompany accounts, click on complete13. Click on Update against Sub ledger accounting; select complete, click on DONE14. Click on Update against Sequencing, Select Complete, click on apply.

Click on FINISH at Primary ledger level, You will get one message, click on yes( if you don’t want any changes), click on NO (if you want any Changes) Close window.

7 . Profile Option to Responsibilities Go to Switch responsibility, Select sys. Admin, Navigation: profile SystemPrimary Ledger will recording the daily transactions, so that transactions will be transfer into GL, so that Purpose we will use Profile option.Click on System, select responsibilities. Select Profile Option GL: LEDGER NAME, click on FindSelect Primary ledger (xxxPL) At responsibility Level, Save it

8. Types of currency’s Basically currency have two typesI .Monetary: which can be measurable with Money is called as Monetary. Monetary have two typesa) Functional Currency: The Local Currency is called as Functional Currency Ex: 10000 /-b) Foreign Currency: The other than Local currency is called as Foreign Currency.Ex: 1000 $ii. Non- Monetary: Which cannot be measurable with Money is called as Non- Monetary. Stat Currency: Which can be calculating with Statistical information is called as Stat CurrencyEx: 1000 kgs

9. Year typeswe have two types of yearsi. Fiscal year: The year will starts from one year and ends with next year is called as Fiscal

Year.Ex: 01-apr-2012 to 31-mar-2013, India financial calendarii. Calendar Year: the year will Starts one year and ends with same year is called as Calendar year.EX: 01-jan-2012 to 31-dec-2013,

10. Period types Based on Organization we will choose period type.Basically we have 6 Period types1.Yearly (1)2.Half-yearly (2)3.Quarterly (4)4. Monthly (12)5. Weekly (52)6. Daily (365)

11. Functional Currency journal and foreign currency Journal Journal: Recording the day to day transactions in the firm of ledger is called as Functional Currency JV: we will record the Transactions with the Help of local Currency is called as Functional Currency journal. Foreign Currency JV: we will record the transactions with the Help of Other than local currency is called as Foreign Currency Journal.