Whats Changing in Oracle

Setups
Master Data Setup
Transactions
Accounting Entries

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High level IT impact due to GST

Financials Procurement Controls and compliance

Procurement schemas
Accounts Payable and Receivables Setting up new warehouses Tracking of CGST, SGST and IGST
Invoicing (Non-PO) Tax compliant warehouses Utilization of taxes
Management of Master Records Vendor master Statutory reporting
Process domestic & import
Billing (Non-SO) Oracle Financials Reports(Custom)
Procurement of goods & services,
Petty Cash Other Statutory Reporting
Material/Service Master
Invoices and Credit Notes Purchase orders, Invoices
Vendor, Customer
General Voucher Subsequent Credit /Debit, G/L Account Reporting
G/L Account Debit/Credit Notes Print Layouts
Purchase Info Records

Sales
Front End Business Human Resource
Pricing procedures Applications
Customer master
Pricing master Travel & Expenses
Process Domestic & Export, Sales
Returns , Debit & Credit Notes
Print Layouts

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High level IT impact due to GST

Processes (Illustrative) System changes

Procurement Processes
Import procurement
Domestic procurement of goods
(within /outside state)
Procurement pricing schemes will under go modifications.
Tax calculations /tax codes changes
Purchase prints
Compliance System to help meet the statutory requirements
through process design, controls and reporting.

Sales Processes Sales pricing schemes will under go modification

Domestic Sale of Goods Tax calculations will undergo changes
Sale of Services Invoice prints
Compliance System to help meet the statutory requirements
through process design, controls and reporting
Stock Transfers Stock transfers to be configured since it will attract taxes and it has to
Within State comply to the statutory requirements
Outside state Compliance System to help meet the statutory requirements
through process design, controls and reporting.

System Configuration/Master data will have to undergo modifications as a result of

process, tax, print changes and compliance requirements

Other key area of focus would be cut over planning and migration

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 GST Impact on IT systems

GST Impact on Oracle can broadly be classified into following heads

Master Data RICEF Roles &

Configuration
Maintenance Components Authorization

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Setups

Tax Defaulting Basis

Tax Defaulting Basis

Item Category Basis Tax Rules Basis

Application
Item Customer Reporting Code
First Party Registration Number
First Party Reporting Code
Item Classification
Tax Category
Item Reporting Code
Ship From Location
Ship To Location
Supplier Reporting Code
Third Party Registration Number

New Responsibility Oracle Financials for India being introduced for Tax Rules Basis Setups

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Setups

Tax Defaulting Basis ..contd

1. Tax Configuration can either be at Inventory Organization Level or Operating Unit Level

2. When Type Operating Unit is selected then the Location Field is greyed out

3. Defaulting is on Date Range Basis; Defaulting on transactions will be based on the applicable rule for that transaction date based on
Start Date / End Date

4. Defaulting Basis LoV has two values :

a. Rule Basis Tax Basis Defaulting

b. Item Category Item Level Defaulting

Impact

In scenarios where client have multiple Inventory Organization across States under single Operating unit then
the Organization Type as Inventory Organization will help to do the defaulting

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Setups

TDS

1. TDS Setups also being moved into the new Tax Regime Architecture

Impact

Configuration of TDS Taxes do be done afresh and would require testing/UAT of TDS scenarios as well

Existing Custom TDS Reports would require retro fitment as the Master data table for Taxes and Vendor
Information like PAN NO, TDS Vendor Type are changing.

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Setups

Tax Rules
Tax Defaulting from Ship From(Vendor)/Ship To(Customer) Location

1. The Tax Determination Value in this case Maharashtra is the State in the Supplier Site Address;(Ship From)
2. For Customers Ship To State is determined from the Location(Define Locations) address attached to the Ship To
(Shipping Details) Inventory Org;
3. In case currently multiple sites for the same address were sharing the same address for ease of maintenance the
same would need to be updated with correct Vendor Site address;

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 Setups

Defining GST Regime

Navigation: Oracle Financials for India Tax Configuration Define Regime

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 Setups

Defining GST Tax Types

Navigation: Oracle Financials for India Tax Configuration Define Tax Types

Since GST is a Destination based Tax, the Tax Point Basis will be Delivery

Likewise Tax Type Code for CGST and IGST to be defined;

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 Setups

Defining GST Tax Types Accounting Default

Navigation: Oracle Financials for India Tax Configuration Define Tax Types

First Level Default of Accounting for Taxes will default from the Tax Type Accounting Definition

Depending on the COA of the client the code combination would be determined; Whether there will be multiple GL Codes
State wise or common GL codes along with other segment combination (i.e. Location Segment)

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 Setups

Defining Tax Rules

Navigation: Oracle Financials for India Tax Configuration Define Tax Rules

The Tax Category will be attached with the Tax Rule code for Defaulting

It is important to understand the relevance of the Field Priority; Priority Number is unique to a code thus a priority
number cannot be shared across Rule Codes;

X Tax Rule Code = Priority 1 having 3 Attributes as Tax Determination Basis

Y Tax Rule Code = Priority 2 having 4 Attributes as Tax Determination Basis

Then Rule Y will take precedence for Defaulting as it has more attributes as tax determination basis

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Master Data

Oracle Financials for India - Snapshot

1. All Customer and Supplier would need to be defined through the Third Party Registrations

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Master Data

Supplier/Customer Master

1. Current Supplier/Customer Additional Information Forms will expire.

2. All Vendor / Customer Indian Localization Information will be captured through Third Party Registration Form under GST

3. Reporting Codes can be configured based on Client Requirement like additional informed being stored currently in Descriptive Flex
Fields(DFF) or the hard coded Registration Number fields in the current localization forms

Impact

All Existing Localization Information of a Vendor/Customer would need to migrated to this structure.

During the Bootcamp the question was raised by us whether the migration will happen through some migration
script or the client will need to build it ? We are awaiting further information on this from Oracle

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 Master Data

Defining Item Classification

Navigation: Oracle Financials for India Item Definition Define Item Classification

A New Template for GST would need to be defined; This is more in line with the current IL Item Template Definition

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 Transactions

Purchase Orders

Impact

Existing PO Localized Forms will expire

Open PO as on 31-Mar-16 with current IL Taxes like Excise, VAT when GRN being made in FY 16-17 for those the
Tax Defaulting Rule as per GST will take precedence; hence no Program for updating taxes on Open Items

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 Transactions

Purchase Orders.. India Tax Details

Impact

The Tax Category will default based on the Determination basis i.e. Tax Rule or Item Classification basis

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 Transactions

GRN.. India Tax Details

Change from Existing

On Navigation to the Base GRN Form Navigate to Tools India Tax Details

Confirm Taxes to be checked

Receipts(Localized) form will expire;

Impact

GRN Cannot be saved unless Confirm Taxes is checked. Currently Base GRN creation and Taxes on the same are two
independent activities;

India Localization Accounting entry interfaced to GL_INTERFACE at the time of GRN creation; No time gap in base
accounting and India Localization accounting

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 Transactions

Sales Order

Impact

Sales Order Localized Form will Expire

Defaulting will be based on either Tax Rule or Item Basis

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 Transactions

Document Sequencing Invoice Numbering

Impact

Invoice Numbering to be refreshed at the beginning of each Financial Year

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Accounting Entries
Tax
Point
Sl Flow Module Event Basis GL Description Dr Cr Remarks
Tax
Suspense Account Amount Refer Slide - Tax Types
1 O2C OM Ship Confirm Delivery
Tax
Liability Amount Refer Slide - Tax Types
Tax
Receivable Account Amount Debtor Control Account
2 O2C AR Auto Invoice Delivery
Tax
Suspense Account Amount Debit in Sl 1 ; Squares off
Tax
Standalone AR Receivable Account Amount Debtor Control Account
3 O2C AR Invoice
Invoice Tax
Liability Account Amount Refer Slide - Tax Types
Tax Interim Recovery Tax Under GST ; GRN will not be able
GRN Standard
Account Amount to be saved unless Taxes
4 P2P Inventory Routing / Direct Delivery
Tax Confirmed
Delivery
Inventory AP Accrual A/c Amount
Tax
GRN Matching with Inventory AP Accrual A/c Amount
5 P2P AP Delivery
Invoice Tax
Sundry Creditors Account Amount
Tax Interim Recovery Tax
Standalone AP Account Amount Refer Slide - Tax Types
6 P2P AP Invoice
Invoice Tax
Sundry Creditors Account Amount
Tax Currently Manually to be
Delivery/ Tax Recovery Account Amount Processed in Release 1 Patch;
7 P2P AP Tax Recovery
Invoice Tax Interim Recovery Tax Oracle working to Automate this
Account Amount process;

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Section 5
Client Should Start.

PricewaterhouseCoopers Private Ltd Slide 22

Client Tasks at Hand
Mapping of Existing Item Codes both Procurement and Sales with HSN Codes
Revisit the Current System Landscape
ERP User Base Impacted Data Entry Points
Need for realigning of User Roles in ERP?
Update the SOPs , User Manuals based on new functionalities , new business requirements being
introduced in Oracle.

Slide 23
PwC