Oracle Cloud Financials has been generally available for a little over eleven years. While early adoption has been slow, the movement to the cloud in the past 12 months has been fast and undeniable. Oracle Cloud financials is built mainly on the strong and sturdy bones of Oracle EBS, but bolstered with the prebuilt integrated power of Essbase for Financial Reporting and Analysis, and Oracle Business Intelligence to allow for on the fly, ad-hoc query ability.
For many EBS users, the move to Fusion is quick and seamless. Changes to the UI and reporting only enhance and improve the user experience and allow for better access to information. If there is one area where I have continually heard concern from those legacy EBS users and those new to Fusion, is the calculation and allocation engine, which utilizes the engine built in Essbase. It is new and different to many users and as with many things new and different, it brings some degree of apprehension. It also brings new possibilities.
We will be taking a brief look at the Essbase Allocation and Calculation Engine Available in Cloud Financials to try and assuage some of those concerns referenced above.
First, let’s review, GENERALLY, what an allocation is and what it should be used for. Allocations are defined as: noun: allocation.
An invoice coded to multiple cost centers in accounts payable is not an allocation. That is a direct charge. However, and invoice coded to a single cost center for say company health benefits that should be shared among many cost centers based on headcount or payroll dollars by cost center, that would be an allocation.
In Cloud Financials, the Allocation Manager replaces MassAllocation and recurring journal formulas to provide a solution that improves usability and performance. The Allocation Manager provides an allocation wizard that is easy to understand, and formula components that provide equivalent functionality to recurring journal formulas with the advantages of Oracle Essbase. The Allocation Manager also provides rule set functionality that allows users to group different rules and generate allocations in an equivalent manner as Auto Allocations in Oracle EBS. The Allocation Manager is a powerful tool that leverages Oracle Essbase; and provides flexibility, automation, intelligence, and control in distributing costs and revenues across the enterprise.[1] So while in the Cloud there is a Wizard Based Allocations tool which does look different from EBS, however, the basic are all exactly the same.
[1] Transitioning from Oracle E-Business Suite to Fusion Applications - Allocation Manager, An Oracle Whitepaper 2011
Balances are stored in cubes by dimensions. Example dimensions include the following:
Allocation Rules
Allocation Rules consist of several main components. The first, and perhaps most important of these is the Point of View or POV. The point of view contains those dimensions that will remain consistent throughout the entire allocation, thus allowing the user to enter them only once rather then enter them for each step in the allocation. For example, if you allocation is only going to look at Ledger 1 and Company 100, you can set those values in the POV at the start and end of the allocation and so, only have to enter them once.
Note: You can also enter variable values in your POV or Allocations. Variables are members, such as period or amount type, which can be selected at run time
2. Enter your Allocations rule
Allocation rules consist of the following components
Once finished, the Wizard will prompt you to save the allocation. Once the rule is saved, the user may validate and deploy the rule, making it available for use.
Allocations in the cloud are new and different from those in EBS, but many of the concepts are exactly the same. So, put your trepidation aside and start allocating!!!