FCCS allows users to utilize intercompany business rules out of the box. Calculations are performed during the consolidation and translation rules that allow for a simple and quick solution to create and track eliminations.

When creating an application, users will tag accounts and entities with a pre-seeded attribute value in order to run the intercompany rules. In order to complete the process, a few steps need to be taken.

The intercompany accounts will be tagged with the attribute value IC_Acc_Yes.

 

If the intercompany account is going to be used as a plug, the account will also be tagged with Plug_Acc_Yes. For plug accounts, the IC_Acc_Yes tag is not required but is necessary if users wish to see any additional detail on the intercompany eliminations.

 

The plug accounts will appear in the plug account list within the attribute values.

The intercompany accounts will need to be tagged with the appropriate plug account attribute value.

The intercompany entities will be tagged with the attribute ICP_Entity_Yes.

 

 

Loading data to the intercompany entities and accounts will allow the system to process the eliminations during the out of the box consolidation process. The system will move the loaded amounts from the intercompany accounts to the plug account which the intercompany account is tagged with.

Users can view the intercompany transactions in detail through the consolidation and data source dimension, the intercompany attribute, and the account and entity dimension.

  • The FCCS_Elimination member of the consolidation dimension displays detail on the elimination data generated during the consolidation process
  • The data source shows detail for eliminations in the FCCS_Intercompany Eliminations node
  • The Intercompany attribute shows similar to a dimension within the dimension list. This attribute will display each intercompany partner

The Entity, account and intercompany partner combination will allow users to audit the detail of the elimination data. For example, we have a simple entity structure of Entity US, MEX and CAN, all of which sit underneath NA (North America). We also have a plug account listed as 20930. Entity 110 performs a transaction with entity 120. The elimination data for this transaction is visible through the intersection between E110 and ICP_120 as well as the plug account.

The intercompany eliminations are pushed to the plug accounts and recorded in aggregate. Similar to any other dynamically calculated rollup, the data in the eliminations node is calculated using the sum of its children. The top level eliminations members will contain the net elimination data for the specified account/entity combination. In the example below, the US intercompany transactions for Plug 1 are aggregated through transactions between the US and Mexico as well as transactions between the US and Canada.

When viewing the intercompany account, the transaction data is moved and consolidated at different members during the process. Using the intercompany account example below, we can see that the data loaded into the account for the intercompany transaction between the US and Mexico is consolidated at the total input and adjusted member of the data source dimension.

We can also see that at the parent level entity member for the intercompany entities, the loaded amount is reversed from the account and placed into the intercompany eliminations member of the data source dimension. The net effect of this aggregation shows a 0 balance in the Total data source level of the parent entity but will still shows the loaded transaction data in the base level entity.

In addition, there are several transactions for the account which did not include intercompany elimination transactions from North America, but from other entity groups. These transactions aggregate at the Intercompany Entities level of the intercompany hierarchy. The entries without an intercompany transaction are loaded and consolidated at the FCCS_No Intercompany level. The results are then aggregated at the FCCS_Intercompany Top member of the hierarchy.

Drilling down into the intercompany attribute, the data source dimension, and consolidation dimension within FCCS allow users to create elimination rules quickly without the need to perform any additional customization but still maintain full detail for audit purposes.

Recent Posts

Successful Reconciliation Compliance with Oracle Cloud

Would you like to learn how Key Performance Ideas can help you utilize Oracle’s Account Reconciliation Compliance Module that saves time, rework, and improves accuracy?  How about seeing the same time savings and accuracy every month?  Would you like to have real-time...

read more