Gaining a Foothold in the Asia-Pacific Market with Oracle EBS

Implement Oracle in China
By ITC Oracle Educator
June 30, 2016

This week we had our webcast: Gaining a Foothold in the Asia-Pacific Market with Oracle EBS, and we took some questions live from the audience. Today we bring you a transcript of the Q&A session. If you missed the presentation, remember you can download the webcast recording here.

What is your recommendation in terms of ledger setup? Should the primary ledger be the statutory ledger or it is possible to set the primary as US GAAP and the second ledger as statutory?
Well, this is a question that comes up in almost every implementation. For some cases we have implemented set the primary as US GAAP and the second ledger as the local GAAP, while in other projects we’ve done it in reverse. The decision depends on many factors and requirements we gather from discussing this with the client, but both possibilities are valid.

Two important side notes to consider: first, whether the local accounting team is familiar with US GAAP, especially in cases where the primary ledger will be the US GAAP, as the team will need to be very aware of the differences between local and US GAAP. Second, in the case of China, because it has the statutory Chart of Accounts, we also have to bear in mind the mapping between the corporate and the China COA.

Are you seeing any ERP Cloud implementations in China or Japan?
For the last couple of years, especially the past one, we have seen that the ERP Cloud implementations in Asia are getting more common, mostly in China. The Cloud is gaining traction, not only for Oracle products but also other vendors.

Are there companies that will take output from Oracle and create the statutory reports and externally facing documents for China? E.G. can we create a China legal entity in Oracle that points to our US chart of Accounts and US operating units?
All Chinese legal registered entities need to have their financial reporting in China, so while you can have the corporate COA point back to the US entity, ultimately you will have to see how you will generate the Chinese financial and customer facing reports, and the Chinese Tax Bureau will audit your accounts either way. Some companies choose to split the processes and have part of it in Oracle, then export the data and do some further work outside the Oracle system. There isn’t a single solution to fit all needs and all countries, so we work on a case-by-case basis to help our clients find the perfect solution for their specific situation.

Are there any options that would not require an install of MLS?
Yes, we have helped many MNCs to implement non-MLS solutions in Asia. In our experience, large multibillion companies who operate globally and have third-party system integrations and CEMLIs often decide to go for a non-MLS solution.

What’s the major challenge for rolling out Oracle simultaneously to different countries in Asia?
The major challenge for Oracle implementation projects in the region centers around finding the way to adapt to different cultures while keeping a tight grip on the project timeline. In the Asia Pacific region, cultural differences between countries are significant. Some nations have a very aggressive way of doing business and are used to taking full ownership of the project, others are not so aggressive. This requires a project management team that can understand cultural diversity and makes an extra effort to coordinate all resources to ensure the project is on time and in budget.

Usually, what is the cost of an implementation? How long does it take?
It normally depends on quite a few factors, for example:

  • Complexity of the business processes
  • Project scope
  • Number of test cycles
  • Whether it’s is a greenfield rollout
  • Number of users
  • Data conversion volume

Normally, an Oracle EBS implementation can range from 5 to12 months. ITC’s strategy is to use a proficient team: all consultants have at least 8-10 years of consulting and/or business experience. In this case, this can help reduce the total cost of the project and, at the same, time ensure project efficiency.

Are there any safe harbor requirements in any of the Asian countries?
So far we haven't heard about any requirements.

Written by ITC Oracle Educator

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