1 Reply Latest reply on Feb 20, 2008 5:41 AM by JPP

    Multiple orgainzation with legal entity?

      Dear all,

      When I define organizations in purchasing, what are the differences between organization with "GRE / Legal Entity" and organization with "Inventory Organization" & "Operating Unit"?

      I have read the oracle documents and I still very confuse all these words?
      Does anyone tell me what are the difference?

      Best Regards,
        • 1. Re: Multiple orgainzation with legal entity?
          Set of Books. A General Ledger SOB, linked to the inventory organization,
          controls the financial accounting of inventory transactions. A SOB is made up
          of a chart of accounts, a financial calendar, and a currency. The general
          ledger secures transactions (journal entries, balances) by SOB.

          Legal Entity. A legal entity organization defines the tax and fiscal reporting
          level. The legal entity represents the legal company.

          Operating Unit. An operating unit organization defines the Purchasing, Order
          Entry, Accounts Payable and Accounts Receivable level of operation. An operating
          unit may span multiple manufacturing facilities, distribution points and sales
          offices, or it may be limited to a single site.

          Inventory Organization. Two flavors of inventory organizations are found in
          Oracle Applications. They are defined the same, and both are assigned a set
          of books, a legal entity organization, an operating unit organization, and a
          location. An item master organization is used for item number maintenance and
          validation. This master organization serves as a data repository storing items
          and item attributes, master level categories and category sets, master level
          cross references, and numerous data defaults. On-hand balances, inventory
          movements, and other on-going inventory activities are not performed in an item
          master organization. Generally, the master organization is used as the
          validation organization for Purchasing and Order Entry. It is recommended
          that a single item master organization be defined, even in multiple organization,
          multiple sets of books environments.