Uncover the hierarchical approach to intercompany balancing in Oracle Fusion Cloud. Learn how the Primary Balancing Segment Rule takes precedence in balancing an intercompany journal.
Table of Contents
Question
An Oracle Fusion Cloud customer has a complex enterprise structure that includes multiple legal entities in multiple countries. To match the intercompany balancing requirements, all four levels of rules have been defined. In user testing, the business experts are asking which rule will be considered first when balancing an intercompany journal?
A. Ledger-level rule
B. Legal entity-level rule
C. Chart of accounts rule
D. Primary balancing segment rule
Answer
B. Legal entity-level rule
Explanation
In Oracle Fusion Cloud, when multiple levels of intercompany balancing rules are defined, the primary balancing segment rule takes precedence and is considered first when balancing an intercompany journal.
The four levels of intercompany balancing rules are:
- Chart of accounts rule
- Legal entity-level rule
- Ledger-level rule
- Primary balancing segment rule
The primary balancing segment rule is the highest level and most specific rule. It allows you to define intercompany balancing rules based on specific values or ranges of values within the primary balancing segment (e.g., specific departments, cost centers, or projects). If a primary balancing segment rule is defined, it will be applied first when balancing intercompany journals.
If no primary balancing segment rule exists or if the journal does not match any of the defined primary balancing segment rules, then the system will evaluate the next level of rules (ledger-level, legal entity-level, and chart of accounts) in that order until a match is found.
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