OFCH Enterprise Structures

ENTERPRISE STRUCTURES
ENTERPRISE
Enterprise is mandatory and serves as an umbrella for the entire implementation and all
organizations are created within an enterprise
Enterprise captures the name of the deploying enterprise and the location of the headquarters.
Three Fundamental structures - legal, managerial, and functional
Legal structure implemented using legal entities

Management / Business structure implemented using divisions and business units
Functional structure is implemented using departments
DIVISION
Segregate multiple businesses by their strategic objectives and measure their results.
Companies may choose to represent product lines, brands, or geographies as their divisions.
Division manager typically reports to a top corporate executive.
Fusion Applications supports a qualified management segment and recommends that you use this
segment to represent your hierarchy of business units and divisions.
If managers of divisions have return on investment goals, make the management segment a
balancing segment.
Division is used in HCM, to define the management organization hierarchy, using the generic
organization hierarchy.
This hierarchy can be used to create organization based security profiles.
Divisions are optional and can be represented with a hierarchy of cost centers or by a second
balancing segment value.
BUSINESS UNITS
Unit of an enterprise that performs one or many business functions that can be rolled up in a
management hierarchy
Normally, it will have a manager, strategic objectives, a level of autonomy, and responsibility for its
profit and loss
Use business units in the following ways:
Management reporting
Processing of transactions
Security of transactional data
Reference data definition and sharing
Perform one or many business functions like Payables invoicing, Payables payments, Procurement,
Sales, Marketing etc
Business function logically indicates a presence of a department in the business unit with people
performing tasks associated with these business functions
Optionally, you can define a hierarchy of divisions, business units, and departments as a tree over
HCM organization units to represent your enterprise structure
When a business function produces financial transactions, a business unit must be assigned to a
primary ledger, and a default legal entity.
LEGAL ENTITY
Define a legal entity for each registered company or other entity recognized in law for which you
want to record assets, liabilities, expenses and income, pay transaction taxes, or perform
intercompany trading
Required to publish specific and periodic disclosures of your legal entities operations based on
different jurisdictions' requirements
Your legal entities can be identified as legal employers and therefore, are available for use in Human
Capital Management (HCM) applications
Frequently, a business unit is part of a single legal entity
Division is an area of management responsibility that can correspond to a collection of legal entities
Divisions and legal entities are independent concepts
Legislative data groups are a means of partitioning payroll and related data. At least one legislative
data group is required for each country where the enterprise operates. Each legislative data group is
associated with one or more payroll statutory units
Legal entities are mandatory.
LEGAL & PAYROLL RELATED STRUCTURES
You associate a legislative data group (LDG) with a payroll statutory unit to provide the correct
payroll information for workers
Each legislative data group is associated with one or more payroll statutory units
Each payroll statutory unit can belong to only one legislative data group
Payroll statutory units enable you to group legal employers so that you can perform statutory
calculations at a higher level
Each of your legal entities has one or more legal reporting units to support local reporting
requirements
Legal reporting units were referred to as establishments in R12 EBS
A legal reporting unit is the lowest level component of a legal structure that requires registrations
Plan and define your legal reporting units at both the local and national levels if you operate within
the administrative boundaries of a jurisdiction that is more granular than country.
You must register your legal entities and reporting units with legal authorities in the jurisdictions
where you conduct business
Use a tax reporting unit to group workers for the purpose of tax and social insurance reporting
Summary:
DEPARTMENT
Department is an organization with one or more operational objectives or responsibilities that exist
independently of its manager
Has one or more workers assigned to it
Departments are mandatory because they track your employees
REFERENCE DATA SHARING (SET ID)
Reference data sharing facilitates sharing of configuration data such as jobs, grades across business
units
Can be understood as buckets of reference data assigned to multiple business units
Use reference data sets to reduce duplication and maintenance by sharing common data across
business entities where appropriate
Oracle Fusion Applications reference data sharing feature is also known as SetID
You begin by creating and assigning reference data to sets
You will then assign the reference data set to one of more business units
You can assign a separate set to each business unit for the type of object that is being shared
For example, assign separate sets for jobs, payment terms, transaction types, and sales methods to
your business units
Make changes carefully as changes to a particular set will affect all business units or application
components using that set.
Example of RDS:
DATA OBJECTS SHARED ACROSS BUS
KEY POINTS
Set enabled objects in HCM are: Departments, Locations, Jobs & Grades
When you create these objects the Set is mandatory field, so they are always created within a Set
With each Business Unit, you can associate only one Department Set, one Location Set etc
Same set can be associated with multiple Business Units
There is a Set available out of the box that is called Common Set
Positions are not set enabled but are defined within a Business Unit.

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ENTERPRISE STRUCTURES

Three Fundamental structures - legal, managerial, and functional

Legal structure implemented using legal entities

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