Operating Unit and Legal Entity

[aruns]

Hello Everyone,

I guess I am a little bit confused with the relationship of Operating Unit with LE and Ledger. An operating Unit in R12 is assigned to a Ledger. Whereas a Legal Entity is the owner of AR,AP invoices/transaction and also the banks. Again how does the balancing segment relate to the Legal Enity in a Ledger. Every Legal Enity you assign to a Ledger needs the balancing segment to be updated when you do the accounting set up. A General Ledger relates to a Legal Entity and all the subledger data flows through SLA to it. How is all this adding up? Can anybody explain with real life examples?
Please do no point me to a link where I may not have access to it.

Thanks,

Arun

[babasoji]

Hii,

Look at the ledger as the book that the LE entity use to record its accounting activities and the Operating Unit as the vehicle that the LE entity use to carry out its activity. Where the LE has more than one subsidiary or division it uses multiple operating unit.

Hope this is helpful