Interview Questions and Answers on GL- General ledger in Oracle EBS R12

 1. What is Oracle General Ledger (GL) in Oracle EBS R12, and what is its primary purpose?

Answer: Oracle General Ledger (GL) is a module in Oracle EBS R12 that serves as the core financial accounting system. Its primary purpose is to manage an organization's financial data, including chart of accounts, journal entries, and financial reporting.

**2. How does Oracle GL integrate with other modules in Oracle EBS R12?

Answer: Oracle GL integrates with various modules, including Accounts Payable (AP), Accounts Receivable (AR), Cash Management, Fixed Assets, and Project Accounting, to consolidate financial transactions and provide comprehensive financial reporting.

**3. What are the key components of Oracle GL in Oracle EBS R12?

Answer: The key components include Chart of Accounts, Journal Entries, Ledger Sets, Currency Conversion, Financial Reporting, Budgeting, and Consolidation.

**4. Can you explain the concept of Chart of Accounts in Oracle GL, and why is it important?

Answer: The Chart of Accounts in Oracle GL is a structured list of all the accounts used to record financial transactions. It's essential for organizing and categorizing financial data, ensuring consistency in accounting practices.

**5. What are Ledger Sets in Oracle GL, and how are they used in financial reporting?

Answer: Ledger Sets in Oracle GL are groups of ledgers that share the same chart of accounts structure. They are used in financial reporting to consolidate data from multiple ledgers and generate comprehensive financial statements.

**6. How does Oracle GL handle the management of Journal Entries, and what information is included in journal entries?

Answer: Oracle GL allows users to create and manage journal entries, which record financial transactions. Journal entries include details such as account codes, amounts, descriptions, and transaction dates.

**7. What is the purpose of Ledger Currency in Oracle GL, and how does it handle transactions in multiple currencies?

Answer: Ledger Currency in Oracle GL represents the currency in which a ledger's financial transactions are recorded. It allows Oracle GL to handle transactions in multiple currencies, supporting global operations.

**8. Can you explain the concept of Ledger Sets in Oracle GL, and how do they assist in financial consolidation?

Answer: Ledger Sets in Oracle GL are groups of ledgers that share the same chart of accounts structure. They assist in financial consolidation by allowing organizations to combine data from multiple ledgers into a single set of financial statements.

**9. What is Financial Reporting in Oracle GL, and what tools are available for generating financial statements?

Answer: Financial Reporting in Oracle GL involves the creation of financial statements, such as income statements and balance sheets. Tools available for generating financial statements include Financial Statement Generator (FSG) and Oracle Business Intelligence (BI) Publisher.

**10. How does Oracle GL handle Budgeting, and what is the role of budget entries?

Answer: Oracle GL supports budgeting by allowing organizations to set budget targets and create budget entries. Budget entries represent planned financial data and are compared to actual data to assess performance.

**11. What is the purpose of Subledger Accounting (SLA) in Oracle GL, and how does it improve financial reporting?

Answer: Subledger Accounting (SLA) in Oracle GL is a feature that captures detailed transaction data from subledgers and creates accounting entries. It improves financial reporting by providing transparency into the source of accounting entries.

**12. How does Oracle GL support the management of Encumbrance Accounting, and what is its role in budget control?

Answer: Oracle GL enables Encumbrance Accounting, which tracks commitments against budgeted amounts. It helps organizations control spending by ensuring budgeted amounts are not exceeded.

**13. What are Suspense Accounts in Oracle GL, and when are they used?

Answer: Suspense Accounts in Oracle GL are temporary accounts used when there is uncertainty or an issue with a financial transaction's accounting treatment. They are placeholders until the correct accounting is determined.

**14. How does Oracle GL handle Multi-Currency Transactions, and what are the challenges associated with them?

Answer: Oracle GL supports Multi-Currency Transactions by allowing transactions in various currencies. Challenges include currency conversion, exchange rate fluctuations, and managing exchange rate tables.

**15. What is the role of Intercompany Accounting in Oracle GL, and how does it handle transactions between legal entities within the same organization?

Answer: Intercompany Accounting in Oracle GL manages transactions between legal entities within the same organization. It ensures proper elimination of intercompany transactions in consolidated financial statements.

**16. How does Oracle GL handle the management of Account Reconciliation, and what is its role in financial close processes?

Answer: Oracle GL provides tools for Account Reconciliation, which involves comparing account balances in GL with external sources (e.g., bank statements). It plays a crucial role in financial close processes to ensure accuracy.

**17. Can you explain the concept of Journal Approval Workflow in Oracle GL, and how does it enhance internal controls?

Answer: Journal Approval Workflow in Oracle GL automates the approval process for journal entries. It enhances internal controls by enforcing approval hierarchies and ensuring that journals are reviewed and authorized before posting.

**18. How does Oracle GL support the management of Financial Reporting Compliance, and what regulatory standards can it adhere to?

Answer: Oracle GL can support Financial Reporting Compliance by allowing organizations to define reporting requirements, including Generally Accepted Accounting Principles (GAAP), International Financial Reporting Standards (IFRS), and local regulatory standards.

**19. What is the significance of Mass Allocations in Oracle GL, and how are they used to allocate costs?

Answer: Mass Allocations in Oracle GL allow organizations to distribute costs across accounts or departments based on predefined rules. They are used to allocate indirect costs and distribute expenses accurately.

**20. How does Oracle GL handle the management of Fixed Assets Accounting, and what is its role in tracking and depreciating assets?

Answer: Oracle GL integrates with the Fixed Assets module to track and depreciate assets over time. It records asset acquisitions, disposals, and depreciation entries.

**21. What is the purpose of Ledger Control in Oracle GL, and how does it ensure data integrity?

Answer: Ledger Control in Oracle GL defines the accounting calendar and currency for a ledger. It ensures data integrity by enforcing consistency in accounting periods and currencies across the ledger.

**22. How does Oracle GL handle the management of Financial Period Close, and what tasks are involved in the close process?

Answer: Oracle GL supports Financial Period Close by providing tools for reconciling accounts, posting journals, running reports, and ensuring that financial data is accurate and ready for reporting.

**23. What is the role of Account Analysis in Oracle GL, and how does it assist in reconciling accounts?

Answer: Account Analysis in Oracle GL helps reconcile accounts by providing detailed transaction listings, balances, and drill-down capabilities. It assists in identifying discrepancies and investigating account variances.

**24. How does Oracle GL handle the management of Cross-Validation Rules, and what is their purpose in controlling account codes?

Answer: Cross-Validation Rules in Oracle GL define the structure and format of account codes to ensure consistency and accuracy in data entry. They control the valid combinations of segment values for account codes.

**25. What is the significance of Financial Statement Generator (FSG) in Oracle GL, and how does it assist in generating custom financial statements?

Answer: Financial Statement Generator (FSG) in Oracle GL allows organizations to create custom financial statements by defining report templates and mapping accounts. It provides flexibility in designing reports to meet specific reporting requirements.

**26. How does Oracle GL handle the management of Multi-Org Access Control (MOAC), and what is its role in multi-organization environments?

Answer: Multi-Org Access Control (MOAC) in Oracle GL allows users to access data across multiple organizations within a single instance. It is crucial in multi-organization environments to streamline data access and reporting.

**27. What is the role of Account Hierarchy in Oracle GL, and how does it assist in financial analysis and reporting?

Answer: Account Hierarchy in Oracle GL organizes accounts into hierarchical structures. It assists in financial analysis and reporting by providing a structured view of accounts and facilitating roll-up reporting.

**28. How does Oracle GL handle the management of Journal Import, and what is its purpose in importing external journal data?

Answer: Journal Import in Oracle GL allows organizations to import external journal data into the system. It is used to streamline data entry and ensure that external journal entries are incorporated into the accounting records.

**29. What is the purpose of Suspense Accounts in Oracle GL, and when are they used?

Answer: Suspense Accounts in Oracle GL are temporary accounts used when there is uncertainty or an issue with a financial transaction's accounting treatment. They are placeholders until the correct accounting is determined.

**30. How does Oracle GL handle Multi-Currency Transactions, and what are the challenges associated with them?

Answer: Oracle GL supports Multi-Currency Transactions by allowing transactions in various currencies. Challenges include currency conversion, exchange rate fluctuations, and managing exchange rate tables.

**31. What is the role of Intercompany Accounting in Oracle GL, and how does it handle transactions between legal entities within the same organization?

Answer: Intercompany Accounting in Oracle GL manages transactions between legal entities within the same organization. It ensures proper elimination of intercompany transactions in consolidated financial statements.

**32. How does Oracle GL support the management of Financial Reporting Compliance, and what regulatory standards can it adhere to?

Answer: Oracle GL can support Financial Reporting Compliance by allowing organizations to define reporting requirements, including Generally Accepted Accounting Principles (GAAP), International Financial Reporting Standards (IFRS), and local regulatory standards.

**33. What is the significance of Mass Allocations in Oracle GL, and how are they used to allocate costs?

Answer: Mass Allocations in Oracle GL allow organizations to distribute costs across accounts or departments based on predefined rules. They are used to allocate indirect costs and distribute expenses accurately.

**34. How does Oracle GL handle the management of Fixed Assets Accounting, and what is its role in tracking and depreciating assets?

Answer: Oracle GL integrates with the Fixed Assets module to track and depreciate assets over time. It records asset acquisitions, disposals, and depreciation entries.

**35. What is the purpose of Ledger Control in Oracle GL, and how does it ensure data integrity?

Answer: Ledger Control in Oracle GL defines the accounting calendar and currency for a ledger. It ensures data integrity by enforcing consistency in accounting periods and currencies across the ledger.

**36. How does Oracle GL handle the management of Financial Period Close, and what tasks are involved in the close process?

Answer: Oracle GL supports Financial Period Close by providing tools for reconciling accounts, posting journals, running reports, and ensuring that financial data is accurate and ready for reporting.

**37. What is the role of Account Analysis in Oracle GL, and how does it assist in reconciling accounts?

Answer: Account Analysis in Oracle GL helps reconcile accounts by providing detailed transaction listings, balances, and drill-down capabilities. It assists in identifying discrepancies and investigating account variances.

**38. How does Oracle GL handle the management of Cross-Validation Rules, and what is their purpose in controlling account codes?

Answer: Cross-Validation Rules in Oracle GL define the structure and format of account codes to ensure consistency and accuracy in data entry. They control the valid combinations of segment values for account codes.

**39. What is the significance of Financial Statement Generator (FSG) in Oracle GL, and how does it assist in generating custom financial statements?

Answer: Financial Statement Generator (FSG) in Oracle GL allows organizations to create custom financial statements by defining report templates and mapping accounts. It provides flexibility in designing reports to meet specific reporting requirements.

**40. How does Oracle GL handle the management of Multi-Org Access Control (MOAC), and what is its role in multi-organization environments?

Answer: Multi-Org Access Control (MOAC) in Oracle GL allows users to access data across multiple organizations within a single instance. It is crucial in multi-organization environments to streamline data access and reporting.

**41. What is the role of Account Hierarchy in Oracle GL, and how does it assist in financial analysis and reporting?

Answer: Account Hierarchy in Oracle GL organizes accounts into hierarchical structures. It assists in financial analysis and reporting by providing a structured view of accounts and facilitating roll-up reporting.

**42. How does Oracle GL handle the management of Journal Import, and what is its purpose in importing external journal data?

Answer: Journal Import in Oracle GL allows organizations to import external journal data into the system. It is used to streamline data entry and ensure that external journal entries are incorporated into the accounting records.

**43. What is the purpose of Intercompany Transactions in Oracle GL, and how are they accounted for?

Answer: Intercompany Transactions in Oracle GL involve financial transactions between entities within the same organization. They are accounted for using Intercompany accounting rules and are typically eliminated in consolidated financial statements.

**44. How does Oracle GL support Multi-Currency Reporting, and what exchange rate types are used for reporting?

Answer: Oracle GL supports Multi-Currency Reporting by using different exchange rate types, including spot rates, corporate rates, and historical rates. These rates are used to convert foreign currency transactions into the reporting currency.

**45. What is the role of Secondary Ledgers in Oracle GL, and why are they used?

Answer: Secondary Ledgers in Oracle GL are additional ledgers that can be created to maintain alternative accounting representations or reporting requirements. They are used for purposes such as IFRS compliance or management reporting.

**46. How does Oracle GL handle the management of Allocations, and what methods are available for cost allocation?

Answer: Oracle GL allows organizations to perform cost allocations using various methods, including fixed percentage, equal distribution, and source allocation. Allocations are used to distribute costs across accounts or departments.

**47. What is the significance of Journal Categories in Oracle GL, and how are they used to categorize journal entries?

Answer: Journal Categories in Oracle GL are used to categorize journal entries based on predefined criteria. They assist in organizing and analyzing journal entries for reporting and analysis purposes.

**48. How does Oracle GL handle the management of Suspense Accounts, and when are they used?

Answer: Suspense Accounts in Oracle GL are temporary accounts used when there is uncertainty or an issue with a financial transaction's accounting treatment. They are placeholders until the correct accounting is determined.

**49. What is the role of Account Aliases in Oracle GL, and how are they used in financial reporting?

Answer: Account Aliases in Oracle GL are alternative account codes that can be used in financial reporting. They provide flexibility in reporting by allowing users to reference accounts using aliases in addition to their primary codes.

**50. How does Oracle GL handle the management of Financial Statement Generation, and what tools are available for creating custom financial statements?

Answer: Oracle GL provides tools for Financial Statement Generation, including the Financial Statement Generator (FSG) and Oracle Business Intelligence (BI) Publisher. These tools allow organizations to create custom financial statements tailored to their reporting needs.