Legal Entity and Operating Unit Setup

Hi,
we are in a process of implementing Oracle Financials R12.1.3 to a group of company (Ex:"A").
That parent company ("A") associates with another three subsidiaries (Ex: A1, A2 and A3). All these four companies can share the same ledger and operating in one country.
So I'm with bit confusion whether It can use One Legal Entity with four operating units or do we have to create four legal entities?
Awaiting for clarifications and Thanks / Lathika

Hi All,
You have to think beyond application functionality, if there these 3 subsidiaries are registered with different name under local governance law then you should create separate Legal entity for each company or subsidiary.
Regards,
Abdul Hafeez

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What is a Legal Entity and Operating Unit??

Hi,
Could someone let me know what exactly is a Legal Entity and Operating Unit. The definition or explanation in the documentation is not satisfactory or clear. What are the differences between the above.
And where in the per_all_assignments_f table is the Legal entity stored. I know that the Legal entity is stored in the Statutory information in the assignments screen. Also can someone let me how based on the company code in the organization the legal entity is linked. Where in the tables is this link maintained?
Could someone let me know the above.
Thanks
Shekar.

Dear Shekar
what exactly is a Legal Entity and Operating Unit?
ANS: According the Book or user guide definitions says:
GRE/Legal Entity: Use this classification to represent the following organizations:
Ultimate Legal Entity: this represents the enterprise, and typically, the enterprise is the highest (global) level of a business organization.
Legal Entity: this represents the designated legal employer for all employment-related activities. The legal authorities in a country recognize this organization as a separate employer. In an organization hierarchy, a legal entity may report to an operating company or to the ultimate legal entity.
Consolidated Legal Entity: this organization acts on behalf of multiple operating companies that are not legally registered, or simply on behalf of the enterprise in a country.
See Shekar the Legal Entity is taken under Classification is we know that the organization is going to show the Taxation to the Government. where as if u take typical UAE countruies here every store is an LLC and they submit the taxing for every store or shop.
Where as Operating Unit is generally used for the different lines of business which are under that Business GRoup
Say for an Example:
ABC is the Company name and that has its root in UAE, Qatar and Oman
then it is like ABC Business Group > UAE Legal Entity > REtail/Property/Furniture etc are the Operating Units.
Hope this information is helpful and clear to you or else let me know if you have any concerns.
Coming to the Company Code we use the code for the Inventory Organizations so that the clients will not get confused with the existing code and the system code so generally we use the same codes for it.

Configuring Legal Entity as Operating Unit without creating new OU

Hi,
I have read the doucment "120funmo.pdf" on page 25/60. Eastern operations can be created as Legal entity and identify as Operating Unit and Inventory organization without creating any new OU and INV. ORG.
How this can be achieved?
I have created Ledger and "Eastern Operations" as Legal Entity and trying to find a way to identify it as OU and INV. ORG.
Thanks,
Narendra
Edited by: 869369 on Jun 29, 2011 11:51 PM

Suppliers are across all Operating Units so you see the same set across Operating Units.
Supplier Sites are partitioned by Operating Unit.
Regards,
Gareth

FUTURE VERSIONS Legal Entity / Cross Operating Unit Direction

Hello,
I am aware that the Multi-Org Team is in the process of redesigning MO to allow a lot more Cross-Operating Unit (built into Legal Entity?) functionality over the next 18 months to allow users to work in a responsibility but across Operating Units. e.g. allow cross-Operating Unit Receipts in AR.
Is there a Statement of Direction for new MO work or some initial analysis I could get hold of that would assist us in planning our roadmap for the next few years? Dates are less important than direction / functionality of what will be available. I'm aware this may not be available for public distribution but we'll truly appreciate all help.
We are one of the larger European sites, currently running 57 books on R11i single-instance (GL, AP, AR, FA, PO, SSP5). We have upgraded to 11i and EFCed last year. We are now in the process of strategic planning for a complete restructure of our Financials system to match a new legal and operating structure. We are looking ahead 2-3 years down the track here.
If there's someone in Oracle (or elsewhere) I can speak to get this information, I know SAS will be quite happy to do this - also we are quite aware that the information implies no commitments from Oracle.
Thanks and Regards
Jay Jewell
IT/Business Consultant (STOUD)
Scandinavian Airlines
ph: international (00)-46-8-797-4337
email: [email protected]

Shaan- the Org Hierarchy is where I can't see the connection: Legal Entities in the org hierarchy are HR organizations, but Legal Entities used in Intercompany Billing setup (e.g. Provider/Receiver Controls page) are GL Legal Entities setup in Accounting Setup Manager. Do you know how does the system connect HR LEs to GL LEs?
Regards,
Adrien

Second COA/ Operating Unit setup

I have a requirement to implement a second operating unit that would utilize a slightly different chart of accounts, that will eventually be consolidated to a less detailed original chart of accounts.
Do I have to setup a new Legal Entity and a new primary ledger to accomplish this?
The new chart of accounts is more detailed than the original one and would have an extra segment. Since an Operating Unit can only be assigned to a Primary Ledger, and the same Legal Entity cannot be used by more than one primary Ledger, does that mean that setting up a new Legal Entity is inevitable?
Is there another way to achieve this?

I believe this is done be defining profile options at the responsibility level - see MOS Doc 551282.1 (What Profile Is Used To Populate the Operating Unit In OM Systems Parameter Form?)
HTH
Srini

Same Org as Business Group and Operating Unit cannot be migrated via isetup

Hi,
I have tried to migrate the setup of an organization which is classified as both Business group and Operating unit.
When it comes to Operating unit API, it errors out with the following Warning message.
I request the iSetup Team to clarify whether there is any restriction in iSetup that the same org as BG and OU cannot be transferred.
If yes, then how to migrate the same...
The above situation happens for the org classified as OU and IO. In this case the INV org API give the warning message.
Regards,
Senthil
Name: HR_OperatingUnit
Type: BC4J
Path: oracle.apps.per.isetup.schema.server.OperatingUnitAM
Time Taken(seconds): 1.0
Importing rows from xml file, and validating rows ......
Message not found. Application: AZ, Message Name: AZW_FWK_USER_ROW_EXCEPTION. Tokens: VONAME = Operating Unit; KEY = Name = 'POC Business Group'
Group Name = 'POC Business Group'
; EXCEPTION = The organization 'POC Business Group' is a business group, please use the business group API to handle it
Transaction rolled back
Processed API:HR_OperatingUnit
Generating Deployment Report...
Generation of Deployment Report process completed.
Status: WARNING
******************************************

It is a known issue and has been fixed as a part of HRMS 12.0.7. You may apply HRMS 12.0.7 or request for back-port on top specific version.

R12: Is Inventory setup mandatory for Operating Unit setup?

Hello,
I am doing the setup of an operating unit for a business on a fresh R12 install.
Is the setting up of the Inventory Organization (with all the info like e.g material account, cost of goods sold etc) is mandatory even if the business will not setup inventory module?
Vik

Hello Manish,
In the example you gave, when talking about
Jain, Manish wrote:
..the system specifically ask you to enter the Inventory Organization field with the inv org you have defined.are you referring to the setup from Financial Options --> Supplier-Purchasing tab --> where we have a field "Inventory Organization"?
This is not a required field and can left null.
Or If we do not have the Operating Unit with "Inventory Organization" as classification, an error will popup when setting up payables?
The problem is that, we have to ask the client about the accounting key for material, COGS etc... and he want to know why we need this since he does not use Inventory module.
Vik

Relation between item master org and operating Unit

How single item master org can relate to multiple operating Unit so that items defined at Master Org level can be accessed in other operating units ?

Hi,
Item will be accessed in inventory organizations which you assigned the item to.
To access items from particular Operating Unit in Purchasing module
define Operating Unit Organization as a Inventory Organization as well.
Then choose this Organization as a Inventory Organization in Purchasing : Setup>Organizations>Financial Options.
In Order Management you choose an Operating Unit which items can be accessed.
Each item assign to Item Master Organization and to Operating Unit Organization and to required Inventory Organizations.
This works in 11i. I dont know how it is in R12.
regards,
Marcin

Upgraded to R12 and Operating Unit Error is coming

We have upgraded to R12. As per the metalink note 259546.1 we have applied a patch to create a non usable operating system as we are not using any of the financial modules.
But now when I am trying to open "Create Timesheet Screen" it gives the following error.
"java.sql.SQLException: ORA-20001: SQL_PLSQL_ERROR: N, ROUTINE, MO_GLOBAL.INIT, N, ERRNO, -20001, N, REASON, ORA-20001: APP-FND-02901: You do not have access privilege to any operating unit. Please check if your profile option MO: Security Profile includes any operating unit or the profile option MO: Operating Unit is set.
I checked the profile option MO:Operating Unit, which is assigned by the the patch that I applied for creation of non-usable operating system.
Any one faced some similar issues

Additional Info
I have set only MO: Operating Unit profile and not MO: Security Profile

Intercompany elimination at legal entity and profit centre level

All,
I have a question regarding intercompany elimination. As far as I understand, BPC can only hold one Interco dimension per application. If you want to perform an intercompany elimination for two dimensions which do not roll up into each other, two separate applications are needed. Please see example below to clarify:
Data is reported the following way:
Legal entity Profit Centre Account Interco Value
The problem is that the profit centre hierarchy does not roll up into the legal entity hierarchy mainly because there are profit centres set up as legal entities. Consequently, the legal entity hierarchy and the profit centre hierarchy are two independent hierarchies.
The business requirement is to have an intercompany elimination at profit centre and legal entity level at the same time (hence requiring two Intercos at the same time). This is needed as some of the profit centres are set up as legal entities.
Can someone advise me as to how to resolve this issue? Did anyone come across a similar problem?
Please let me know if you require any further clarifications.
Marc

Hi
Try to use 2 application for the interco elimination
for the 1st appls ur entity will be the entity dimension and use intco as intco dimension
for the 2nd one use the profit center as entity and build a new intco
As per interco logic this is using the Intco property in the Entity dimension and Entity property in intco dimension
it is very impossible to do this in one application
Thanks
CSD

Renaming of Business Group, Legal Entity, Ledger & Inv Org

Dear All,
We are using Oracle EBS R-12 and would like to rename the followings as our company name has been changed.
* Business Group
* Legal entity
* Ledger
* Operating Unit
* Inventory Organization
We just want to know that is there any issue after change the name of above?
Regards,
Abdul Hafeez

Hi
For the Business Group, Operating unit & Inventory Org. You can rename the organizations name no problem from the define organizations form query for the organization you want to rename, rename it and save.
For the ledger you can update your ledger name no problem. GO to accounting setup manager find you ledger update accounting setup> update journal processing> rename your ledger> Finish.
For the legal entity GO to accounting setup manager> Legal Entity (T)> Find your legal entity> View details> Update> Rename your Legal Entity name. Do the same for the legal establishment.
Regards,
Mohamed Badry

Balancing Segment Value assignment to Legal Entity using Account Setup Mgr

Hello,
This is on r12.06
By mistake- I did not assign BSV at Legal Entity level, insteady I directly assigned at Ledger level. Now, I am getting following error when running "Accounting Program" standard program
The subledger journal entry contains lines with balancing segment values that are not assigned to any legal entity. Unassigned balancing segments cannot be used to balance a subledger journal entry with balancing segments already assigned to a legal entity. Either update the balancing segment value assignments for the ledger ADP/Claims Solutions Group or update the balancing segment values used on the subledger journal entry Upon research, It was discovered that that the Balancing segment is assigned only at ledger level and it is not assigned at Legal Entity level in account setup manager.
When I attempted to assign the BSV at LE level, it is not showing the BSV in list of values.
I even end dated BS at ledger level and tried again but still the concerned BSV is not showing up in LOV at Legal entity level.
Now I am completely stuck. Any idea what am I missing? Why, the new BSV is not showing up at LE level LOV when attempting to assign BSV at LE level?
Thank you for reading this post in advance.
Regards,
R

Once a BSV is assigned to the ledger it does not appear in the LOV of BSV-LE assignment field. Pl see if you can delete the BSV from ledger assignment, then only you can re-assign to LE. In my opinion, it allows you to delete the BSV from ledger level if you have not already used it in transactions. In your case, I wonder if it will allow you to delete it. If not, you have to raise SR with Oracle support.
Thanks
Tarun

Vendor information and/or Operating Unit information is missing.

Hi,
I am new to the interface and learning programing can any body pls help me on this accept i will be thank full
I am running AP_SUPPLIER_SITES_INT and i got an error as
Vendor information and/or Operating Unit information is missing.
and also pls give me the diff b/w org_id and operating unit why the tables end with _all.
Thanks in advance
Thanks and regards
Goutham
Message was edited by:
goutham konduru

check out these:
http://www.oracleappshub.com/oracle-application/_all-tl-vl-vf_vl_a_avn-and-what-else/
http://www.oracleappshub.com/beginner/understanding-multi-organization-structure-in-ebs-part-1/

MO Operating Unit Profile Option Needed for Mass Allocation in R12

Mass Allocation does not work in R12 unless you set MO Operating Unit profile option at GL Responsibility level. Is that an official requirement from Oracle or is that a bug? A client should be able to implement and use GL without setting operating units as they are needed for subledgers.

Hi
I have found the below mentioned information on MO: operating Unit Profile option from the Oracle E-Business Suite Multiple Organizations & Oracle General Ledger Reference Guide which directly or indirectly requires the setting of the profile option at the appropriate level (responsibility, site etc)
Profile Options not Owned by General Ledger:
The following profile option affects the operation of General Ledger, but is not "owned" by General Ledger:
• MO: Operating Unit - This profile option controls which operating unit a particular responsibility is assigned to.
Note: General Ledger's Account Inquiry window ignores the setting of this profile option. This allows you to drill down to your subledgers independent from their multiple organization setup. As a result, when you drill down to subledger details, General Ledger will show you all of the transactions that comprise an account balance, regardless of which organization originated the transaction.
To use multiple organizations, you must define an accounting setup with at least one legal entity, a primary ledger that will record the accounting for the legal entity, and an operating unit that is assigned to the primary ledger and a default legal context (legal entity).
You must set either the MO: Operating Unit or MO: Security Profile profile option for each application responsibility to use Multiple Organizations context sensitive applications. When you connect to the Oracle Applications, you sign on by entering your user name and password. Then, you choose a responsibility that is available to your user. After you choose your responsibility, there is an initialization routine that reads the values for all profile options assigned to that responsibility. Oracle Applications allows you to see only the information for those operating units that are assigned to your responsibility.
Hope this helps.
Thanks and Regards
Manish Jain

Probleme whith "MO: Operating Unit profile option" please help.

i have this message when i call this API:
HZ_CUST_ACCOUNT_V2PUB.CREATE_CUST_ACCOUNT,
the message is :
1. Please set the Receivables system options for this operating unit and ensure that the MO: Operating Unit profile option is correctly set with an operating unit that is set up in Receivables.
2. Column account_number must have a value.
please can some one help me !
thinks a lot.

Hi
I have found the below mentioned information on MO: operating Unit Profile option from the Oracle E-Business Suite Multiple Organizations & Oracle General Ledger Reference Guide which directly or indirectly requires the setting of the profile option at the appropriate level (responsibility, site etc)
Profile Options not Owned by General Ledger:
The following profile option affects the operation of General Ledger, but is not "owned" by General Ledger:
• MO: Operating Unit - This profile option controls which operating unit a particular responsibility is assigned to.
Note: General Ledger's Account Inquiry window ignores the setting of this profile option. This allows you to drill down to your subledgers independent from their multiple organization setup. As a result, when you drill down to subledger details, General Ledger will show you all of the transactions that comprise an account balance, regardless of which organization originated the transaction.
To use multiple organizations, you must define an accounting setup with at least one legal entity, a primary ledger that will record the accounting for the legal entity, and an operating unit that is assigned to the primary ledger and a default legal context (legal entity).
You must set either the MO: Operating Unit or MO: Security Profile profile option for each application responsibility to use Multiple Organizations context sensitive applications. When you connect to the Oracle Applications, you sign on by entering your user name and password. Then, you choose a responsibility that is available to your user. After you choose your responsibility, there is an initialization routine that reads the values for all profile options assigned to that responsibility. Oracle Applications allows you to see only the information for those operating units that are assigned to your responsibility.
Hope this helps.
Thanks and Regards
Manish Jain

Legal Entity and Operating Unit Setup

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