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Project segment in GL… mood swing

I wrote an article a while ago on the subject of whether a project segment should be in the GL or not. This always attracts some robust debate whenever it appears on various Oracle Projects forum.

Time for an update on this subject I think:

I am very much still with the majority on the validity a project segment in the GL. My opening position is always that a project segment is not required in the GL. However if there is a business justification, and it must to be a compelling justification, then a project segment can be included in the GL COA.

Some examples of false business justifications for me are:

  1. “It makes reconciliation between GL and OP easier”: This is not the case and is a common misconception. It actually increases the risk of reconciliation differences between the two applications.
  2. “It makes project reporting easier / better”: Again a common misconception. It actually creates problems in reporting, as data is effectively denormalised between the two applications, begging the question – which one is correct / master?

There are however certain business justifications, for example:

  1. Where there is a genuine and justified need for project balance sheet reporting, which is pretty much impossible in OP. I would still challenge the need for this, unless you are dealing with very large projects which are like businesses in their own right.
  2. Associated with the project balance sheet reporting requirement is an environment where projects own assets or have their own bank accounts.

The middle ground is that a segment in the GL COA can be used for large projects to also have a Project code in the GL, whereas most projects would just have a default projects segment code in GL of say 000000.

20 Jul, 2012 by

Technical discussion

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