Accounting Hub Cloud –
Adoption and Product Update
Shyam Santhanam
Director, Financials Product Management
Copyright © 2019 Oracle and/or its affiliates.
Agenda
• Key Use Cases Overview
• Accounting Hub Overview
• Customer Adoption Trends
Copyright © 2019 Oracle and/or its affiliates.
Accounting Hub: Key Features
• Configure unlimited user defined sub ledgers
• Flexible Modeling options for centralized journal
management
• Easy to Implement, expand and maintain
• Configure Touch Less Processing for accounting
• Leverage Modern Reporting tools in Oracle Cloud and
gain insights
• Data output for integration w/ existing corporate GL
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Profile Fully Digital (Internet/FinTech/E-Commerce) Traditional to Digital Transformation Large Diversified Enterprise
Hyper Growth Industry Disruptions Multiple ERPs and Financials Systems
• New offerings, new geographies, high • Industry is witnessing new players with will continue
volumes, Acquisitions new delivery models • Subsidiaries and divisional level
ERPs
Multiple parties in a single transaction Captive Innovations • ERPs coming via M&A (there
• Provider, receiver and the platform • Enterprises investing in new product will always be a few at any point
• Cross border services lines in time)
• Converting from physical products to • Corporate ERP for shared
Multiple price elements in a transaction services service functions
Characteristics
• Provider charges, taxes/fees and platform • Industry Applications such as
fee Growth by Acquisition Utilities, Healthcare, Telecom,
• Multiple currency elements • Acquisition of companies with net new Banking
revenue model
Blending of physical assets/supply chain with
revenue/cost models Strategic Partnerships
• Tracking of assets under operation • Embedding partner services into the
• Sale with Subscription core offering (like a radio service in
car)
Transaction Execution without accounting Accounting inconsistency Lack of One unified ‘source of truth’
• Transaction is executed on the business • Multiple systems of accounting of ‘Actuals’ / financial statements
platform • Varying granularity at General Ledger • Disparate chart structures in
ERPs
• Financial execution also happens as part of Lack of Visibility • Immature/Rigid accounting
transaction execution • Unable to view blended Margin and P
For ex: Charging the consumer’s card on & L at lowest unit of revenue across P&L owners need views of financial
Challenges reservation revenue streams performance
Paying the restaurant on food delivery • Finance data is split between
Low agility transactional ERPs and shared
Limited In-House Accounting & reporting • GTM is slowed down by bookkeeping service finance systems
• Often accounting done at month end or in and accounting process rollout
less than daily frequency FP&A needs a full and detailed view of
• Manual accounting operations with long close financial information
lead time • Low auditability of the financial
4 balances before financial close
Rapidly Implement
Rapid onboarding, Flexibly modify configurations, Build robust accounting rules
Create Enrich Data Configure
Analyze Data
Subledger Sources Accounting Rules
• Accounting requirements • Capture the data elements • Build additional • Configure rules to construct
• Reporting requirements in spreadsheet transformations Journal entries and derive
• Upload to Accounting Hub • Use them for accounting account codes
and reporting
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Touchless and Automated
Straight-through from Source System to General Ledger
Transform Data Integrate Review Analyze
• Transform the source • Automate by calling ERP • Review accounting in Cloud GL • Run Financial and Management
system data to Accounting web services for • Drilldown to Accounting hub reports
Hub Transaction Feed uploading and importing journals and to the source
transactions transactions
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Successful Business Partnering
Finance can support business decisions, swiftly report on performance
Business
Insights
Operational
Insights
Financial
Insights
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Current Roadmap
19C
• Purge Accounting Exceptions in
Bulk Upcoming
• Batching support for FSM • Resolve accounting
19A Export/Import exceptions with
• Formula in formula 20B recommended actions
• Advanced import
Accounting Hub • Valuation Method Support • BICC extracts for • Self-Service diagnostics
• FBDI for mapping sets
GA – Oct 2017 transaction objects per transaction
• Transaction Reversal
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Road to Accounting Hub Cloud
Recommended Opportunities to Rationalize & Optimize
• Data Transformation using User Defined Formula
Numeric Calculations (Ex: Fee as Percent of Principal)
Text Transformation (Ex: Line of business = Product + Department)
Logical Operators (Ex: Invoking a journal line or a account rule on specific condition)
This helps in creating a library of common conditions instead of creating same conditions in multiple rile
components
Leverage Formula in Formula to simplify creation/maintenance
• Use 10-Input Mapping set to simplify account derivation
Use upto 10 input conditions to derive a segment or account combination
Cut down Account rules and complex conditions significantly
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Road to Accounting Hub Cloud
Recommended Opportunities to Rationalize & Optimize
• Design approach to Accounting Event and Volumes
Accounting Hub takes transactions as Headers and Lines
The feeder/staging area owns the pure business attribution (No accounting logic)
Accounting hub owns the additional accounting attributions and transformations
The source system transaction format can be rationalized into accounting hub feed format in
two ways
Summarization – Ex: Multiple similar transactions for same customer account can be grouped into one summary
record for a day
Flattening – Ex: Multiple monetary components requiring distinct accounting treatment can be placed as
transaction columns. Principal, fee, service tax etc. can be send as one row instead of multiple rows
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Road to Accounting Hub
High Level Architecture
Accounting Hub Cloud
Source
Business
events
summariza
Event Data Enrichment
generation
tion (User Defined
Formula) Accounting Rules
Platform Systems Staging area
Fare, fee, charges
AH Cloud Feed
AH Feed
etc. aggregations
creation
and
upload
Accounting Entries/GL Balances
• OFSAA (Banking)
• In-House (Using Oracle or non-oracle
tools)
Key Functions
• Summarize/Flatten
• Standardize economic event model
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Road to Accounting Hub Cloud
Transaction Processing Strategy
Functionally segregate into
accounting streams
Flatten
Pre-Process Subledger1 + Ledger
C1-T1-Loan Origination-Principal
C1-T2-Loan Origination - Fee General
F1 Origination C1 Principal Fee Subledger2 + Ledger
Source Ledger
Systems C1-T3-Monthly Payment-EMI
C1-T4-Late Fee Subledger3 + Ledger
S1 Cash Receipt C1 EMI Late Fee
Summarize
Explode into Accounting Summarize
100 Million* X% Reduction Entries
~60 Million ~10 Million
~120+Million
*Assume a scenario of 100 million transactions per day
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Key Adoption Trends
Key Themes Trending Regions Top Industries
Cloud Transformation North America Financial Services
One Accounting Platform Asia
Services & Subscriptions
Europe
Finance data standardization Travel, Transportation
and Marketplaces
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Business Model Market Place Market Place Subscription/Usage & Physical Investment Management
Sale
Oracle SaaS Accounting Hub & ERP Accounting Hub & ERP Accounting Hub, ERP & Supply Accounting Hub
chain
Avg. Daily Volume: 0.5 M trans
Airbnb: 5 Million/~45 mins Lyft: 15 million/~2 hrs Millions Summarized into few Processing time:
Transaction Volume
hundred thousands Cloud ~ 7 mins.
1 Txn = ~10 accounting lines 1 Txn = ~10 accounting lines On-prem. ~ 30 mins.
Avg. Peak Volume: 4 M Trans.
Processing time:
Cloud ~ 35 mins.
On-prem. FAH ~ 4 hrs.
Business Value • Daily View of financials • Daily View of financials • Blending finance across • Phased Transition to Cloud
• Cut close cycle to 4 days • Cut close cycle to 4 days supply chain and fee-based
revenue streams • Significant cut down on
processing lead time
• Onboarding new offerings
and new geographies in • Onboarding Acquisitions • Moving towards continuous
weeks accounting
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Resources
• Quick start guide
• Tips & Tricks
