There are multiple system entities that are in a generic fashion referred to as organizations in the applications suite. These however, have classifications that identify how they will be used and their effect on the configuration and usage.
The Oracle E-Business Suite includes the following important system entities:
Each system entity is assigned to a classification that determines its functionality and indicates how you might want to deploy it. These system entities sit at the highest level of the configuration basis in the suite and are shared across all the products within the E-Business Suite.
We will be focusing on the Operating Unit in this chapter. This is due to the fact that the Operating Unit (OU) provides the seemingly unique aspect of being able to segregate data within a ledger, legal entity, and business group.
The functionality that an OU provides, commonly referred to as multi-org, enables multiple business units in an enterprise to use a single installation of E-Business Suite Applications products while keeping transaction data separate and secure. This was first introduced in an earlier release (Release 10.4). Prior to this release this functionality required users to install multiple versions of the software to manage these segregations.
The segregations were managed by assigning a responsibility (or a role) to a user that secured data to an Operating Unit (OU). This allowed users to use a single installation of the applications suite and manage data segregation and transactional capability to specific areas within the enterprise. This has been enhanced to allow access to multiple organizations, called Multiple Organization Access Control (MOAC) , from within a single responsibility with Release 12.
Some of the modules that support the multi-org structure are:
The functionality secures access to data so that users can access only information that is relevant to them. You can also sell products from one Operating Unit that uses one primary ledger, but ship them from another Operating Unit using a different primary ledger, while automatically recording the appropriate intercompany accounting by posting intercompany accounts payable and accounts receivable transactions.
The multi-org model provides a hierarchy that can dictate how transactions flow through different business units and how those business units interact. In the next illustration, note the different shapes used for each organization type. The shapes are helpful when drawing multiple organization diagrams.
With E-Business Suite Applications accounting, distribution, and materials management functions, you define the relationships between inventory organizations, operating units, and ledgers to create a multi-level company structure. Each organization classified as a legal entity must specify a primary ledger to post accounting transactions. A legal entity points to one and only one primary ledger. An inventory organization is used to define, manage, and store items (products, parts list) and must reference an operating unit for sales and procurement transactions. In R12 an inventory organization can point to only one operating unit. Items are defined in the master inventory organization (master parts list) and added to the appropriate child inventory organizations for transactional purposes. This is explained in a little more detail in the Chapter 4, Inventory.
Multiple Organization Access Control (MOAC) is basically the ability to access multiple operating units from a single application responsibility. In prior releases, a single responsibility allowed access to process data only for one operating unit. If a user was managing Payables for Sweden, Norway, and Finland a user needed to have three different responsibilities to do their tasks.
Note
The operating unit is used to manage data in subledger products—as listed earlier—General Ledger does not use operating units to segregate data.
In Release 12 a security profile is used to assign multiple operating units as required. This security profile when assigned to a responsibility will grant access to multiple operating units. Given the example of a user above managing payables for Sweden, Norway, and Finland they could now manage all payables for these three countries from within a single responsibility. MOAC is not enabled and used for the iProcurement and iExpense modules.