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February 3, 2007

Oracle E-Business Tax R12

The new tax engine that is included Oracle e-Business Suite Release 12, Oracle E-Business Tax, is fundamentally different from the multi-point solutions that were implemented piece-meal in various modules over prior releases.

The new Tax Services provide several new ways to perform tax operations, not simply tax calculations. Some of the new services include a consolidated tax line audit data repository, integration with XML Publisher, a new tax simulator to verify tax set up, and most importantly new rules and conditions that leverage more data associated with the transaction and thus less reliance on direct assignment and defaulting of tax codes. The functionality is ideal for a global organization, with complex requirements that are in constant flux. This new flexibility also adds complexity, so there is a learning curve before the tax analyst can fully leverage the nuances in the product to meet their compliance needs. Nevertheless, for simple taxes, some basic set up steps can ease the implementation of simple tax computations. As well, the new tax integration services allow third party tax engines to be configured more easily.

All the new functionality, however, poses a problem for the migration from Release 11i. The upgrade process, although automatic, should be approached with some care. While the upgrade will occur automatically, there is no real advantage to the organization since all of the old tax codes become tax classifications, and automatically use the old defaulting rules. Thus, no harm no foul. To get some real value out of the new tax product, however, the organization should take stock of its existing configuration, including third party integrations, and determine a path through the upgrade to leverage the new tax services.

I will go over some of the new Oracle E-Business Tax features, their challenges and benefits in future blogs.

Posted by alexfiteni at February 3, 2007 11:11 AM

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