Tag Archives: Assets

How To Capitalize Legacy CIP Costs in Oracle Projects

Here is a quick summary of steps to convert legacy CIP costs on capital projects and capitalize them into assets. The instructions are applicable to both: Oracle EBS 11i and R12. This article assumes that you have already configured all prerequisites in your Oracle Project Costing and Fixed Assets. You will need Project Costing Super User and Fixed Assets Manager responsibilities, or the customized versions there of.

Define Capital Projects

Let’s start with defining the project template. This is where you can leverage a lot of good Oracle functionality to your benefit.  The details will vary in every instance, but in general, you need to complete the following steps:

PA1: Define Capital Project Template – Header

Navigate to Setup > Project > Project Templates to create a new template. Define the header-level information including the Number, Name, Project Type (make sure it is a Capital  project type class – you won’t be able to change it later), Organization, and Description.  If you want project created from this template to have a fixed duration (e.g. 12 months), define the Trans Duration. The system will populate the Project Finish dates based on the Project Start date and this duration for new projects.

PA2: Define Capital Project Template – Quick Entry Fields

Click on Setup Quick Entry. Define the fields for quick entry of projects. These are the “bare minimum fields” to enter when you copy a template into a project.

PA3: Define Capital Project Template – Tasks

Click on the blue box next to the Tasks option (I know, it not very intuitive), or click on Detail (while the cursor is on Tasks). Define your tasks, or work breakdown structure (WBS). Also determine which tasks should be capitalizable or not, i.e. can collect CIP costs to become fixed assets.

PA4: Define Capital Project Template – Define Project Assets

In this step, you can pre-define fixed assets you anticipate to complete as part of projects created from this template. Basically, you do here what you’d normally do in FA Mass Additions. You can use the Create Project Assets DataLoad to upload a higher volume of assets…

PA5: Define Capital Project Template – Assign Project Assets

Depending on your implementation approach, you assign default assets at project or task level. This functionality determines how the capitalizable expenditures will be assigned to future assets. In order to automate this, you probably want to assign assets at the task level so that you have one-to-one relationship between the costs and the assets in your tasks. The other options would be the costs in multiple tasks to be summarized into one asset at the project level… Refer to the Asset Summary and Detail Grouping Options in the Oracle Project Costing User Guide. You can use the Create Task Level Asset Assignments.

PA6: Define Capital Project Template – Create Task Transaction Controls

Following the example of the task-level asset assignment we defined in step PA5 above, it is critical, that the right CIP costs get collected in the right tasks. In other words, we want building-related costs be collected in building-specific task to capitalize them into a building asset assigned to the same task. To prevent invalid entries, you can create Transaction Controls. These are, basically, conditions that determine what expenditure types or categories are allowed in what projects or tasks. Again, use this sample Create Task Transaction Controls DataLoad to prepare and execute your upload. The trick will be finding the right tasks based on their WBS level. And one note about the Transaction Controls: make sure the Control Start Date and End Date are consistent with your Task Start Date and Finish Date.

PA6: Define Capital Project Template – Set Task-Level Capitalizable Flag

This is an optional step, and this should be taken care of by your Transaction Controls. However, you can make all expense tasks non-capitalizable by setting the Capitalizable flag to null… You can use this Update Expense Task Capitalizable Flag DataLoad.

PA7: Create Projects

Using the template created in steps PA1-6, create your capital projects. The quick entry fields will vary depending on your template, but as always, you can use the Create Projects DataLoad.

PA8: Upload Legacy CIP Costs

Depending on your conversion strategy, you can use a custom conversion program, or WebADI spreadsheet to upload your legacy CIP costs. Check this article for detail on how to convert legacy costs and how to resolve a couple of “features” during the Transaction Import.

PA9: Update the Project Status Inquiry Amounts

As Project Costing Super User, run the PRC: Update Project Summary Amounts

PA10: Complete Asset Definitions

Based on your implementation strategy and business process, you might be required to complete asset definitions in Projects before asset lines can be generated and interfaced to Oracle Assets. As Project Costing Super User, navigate to Capitalization > Capital Projects. Query up your project(s), click on Assets > Asset Details. Complete the asset definitions, just like you would in the Prepare Mass Additions.

PA11: Generate Asset Lines

As Project Costing Super User, run the PRC: Generate Asset Lines for a Range of Projects process. Watch the Date In Service parameter and PA Date parameter to make sure you select the right lines to generate.

PA12: Interface Asset Lines to Assets

As Project Costing Super User, run the PRC: Interface Assets to Oracle Assets process. It will create mass additions in FA MASS ADDITIONS table.

FA13: Post Mass Additions

If you required complete asset definition in Projects, your mass additions are ready to be posted. If asset lines are incomplete, you need to complete them in Prepare Mass Additions. In any case, once ready, log in as Fixed Assets Manager and navigate to Mass Additions > Post Mass Additions to create assets.

At this point, your legacy CIP costs were capitalized into fixed assets. Obviously, this summary is  simplified; refer to the Oracle Project Costing User Guide and Oracle Assets User Guide for more details.

When Oracle Asset Security by Book Doesn’t Work

This feature of the week is for those who operate in a multi-org environment with multiple Asset Books. Unlike other Oracle Financials modules (Payables, Receivables, Purchasing, Order Management or Projects), Oracle Assets is not operating unit specific. The way you separate your transactions is by defining the Asset Security by Book.

Summary of Setup Steps

Step 1: Define Asset Organizations.

As Fixed Assets Manager:

  • Navigate to Setup > Security > Organization > Description.
  • Query up the organization, for which you want to define the Asset Security. Typically, this could be your operating unit.
  • Include classification ‘Asset Organization. Click ‘Other’.
  • Associate the organization with the asset book. Now, this step is very peculiar. You want to find an existing asset book. But! If you ran an open query, you’d get all books, which were already associated with this organization. And if you were assigning the first book to this organization, you’d retrieve nothing.
  • What you must do is submit a specific query, i.e. run it as View > Query by example > Enter, and enter the book name.
  • Then you have to make a change, any change like changing the book description, in order to be able to save it. This is not a bug, it’s a feature! So be aware of it.
  • Save you changes. Now your book is associated with the asset organization.

Step 2: Define Asset Security Profile

As Fixed Assets Manager:

  • Navigate to Setup > Security > Security
  • Define a profile, which you will later assign with user responsibilitities. The profile links together the asset book, asset organization and responsibility.
  • Select Organization Hierarchy and Top Organization in it to be valid in this profile, or
  • Include specific organizations, which will be valid in the profile.

Step 3: Assign FA Security Profiles

As System Administrator:

  • Navigate to Profile > System.
  • Enter the asset responsibility you want to assign to a specific asset book (FA security profile).
  • Enter ‘FA Security Profile’ as profile.
  • Enter ‘Your Asset Profile Name’ in the profile value.

Step 4: Validate Your Asset Security Setup

Log in with the responsibility, for which you just defined the Asset Security above. Navigate to Asset Workbench and select the book values. If you see more than the one book you expected, something is not right.>

When Asset Security Doesn’t Work

  • Check the Organization and Organization Hierarchy Setup. The Security by Book feature enables you to designate an organizational hierarchy in which the assets of an organization can only be seen by either the organization or its parent.You may set up a number of organizations and include as many of them as you wish in the hierarchy. Make sure that your hierarchy is set up as you expect.
  • Run the Security List Maintenance program. This program populates the LOV’s with the appropriate information. If you miss this important step, your LOV’s will not show the correct books that are available for each organization to access.
  • Define Asset Security for all books. You will always see asset books, which are not associated with any security profile. If there is a book that already exists on the system and you have not assigned that book to a particular organization, all organizations will be able to see the book and its assets.

For more information, refer to the Oracle Assets User Guide, or this [old but good] white paper on the subject (Oracle Metalink sign-on required).

How to Override Asset Depreciation

I am not actually sure when this feature became available but, to my delight, I found out today that you can retroactively override existing depreciation amounts for standalone and group assets calculated by Oracle Assets. Hence, depreciation override is my “feature of the week” this week.

Before running depreciation or performing adjustments, you must provide the necessary information in the Depreciation Override window or the FA_DEPRN_OVERRIDE table. Indicate whether the override is for depreciation or adjustments. When running depreciation, the system will upload and use the depreciation amounts provided in the interface table. You have to set the profile option FA: Enable Depreciation Override to Yes in order to use this feature.

Here is how to enter a depreciation override amounts using the Depreciation Override window:

1. As Fixed Assets Manager, navigate to Depreciation > Override.

2. In the Find Assets window, you can search for assets for which you need to change depreciation. If you did not use the Find Assets window, enter the asset number, book, and period of the asset in the rows of Depreciation Override window.

3. In Depreciation Override window, enter the override depreciation amount in the Depreciation field, or enter the override bonus depreciation amount the Bonus Depreciation field.

4. Select the adjustment type of Depreciation or Adjustment in the Use By field. The Status field displays the current status of the override record, which may be New, Post, or Posted. Set the status to ‘Post’ to submit your override. If the status is Post or Posted, you cannot update the record, you can only delete the record and reenter the updated record.

5. Save your work.

Depreciation Override Screen

6. Run What-If Analysis or Projection to review the estimated depreciation amounts for that period. The depreciation run will pick and process your overrides in the ‘Post’ status and will change them to the ‘Posted’ status.