By David Pabst, Solution Architect and Oracle Ace Pro

Welcome to the third installment in my series exploring Oracle Cloud EPM Planning's prebuilt modules. Previously, we’ve discussed the Financials module and its capabilities in planning P&L, Balance Sheet, and Cash Flow, as well as the Workforce module, which simplifies labor cost forecasting and headcount planning.

Today, we’re diving into the Capital module, a tool designed to help organizations manage fixed asset additions, capital leases, and intangible assets as part of their planning process. This module offers a structured, automated approach to forecast the financial impact of asset changes while supporting strategic decision-making.

What Is the Oracle EPM Capital Module?

The Oracle Cloud EPM Capital module is designed to handle asset additions such as vehicles, laptops, IT projects, self-constructed-assets, as well as leasehold improvements. It calculates the forecasted financial statement impact of proposed acquisitions, including depreciation expense, capitalization impacts, and overall budget alignment.

This module also allows you to:

Propose new assets or asset changes.
Evaluate capital lease scenarios under standards like IFRS16.
Include existing in-service assets to model improvements, impairments, retirements, or depreciation.

By consolidating asset planning into your broader budget and forecasting process, the Capital module ensures visibility and alignment across your financial statements.

Oracle Cloud EPM Capital provides a single pane of glass where you can see the combined impact of your existing fixed asset base + forecasted additions and the resulting impacts on your P&L, Balance Sheet, and Cash Flow.

Key Features of the Capital Module

Acquire New Assets: Plan for new tangible assets like laptops, vehicles, or other hard assets and model their financial impact.
Accounting for Self Constructed Assets: IT projects, buildings, etc.
Capital Leases: Evaluate leases under IFRS16, calculating both financing and capitalization impacts.
In-Service Asset Management: Optionally load existing assets to forecast depreciation, propose improvements, and evaluate impairments or retirements.
Scenario Analysis: Model various asset acquisition scenarios to assess budget impacts.
Financial Integration: Consolidate the financial statement impact of fixed assets into your overall budget, including forecasted depreciation.

The Oracle Cloud EPM module fully supports forecasting for IFRS16/Leased Assets and understands how to handle the fixed asset, depreciation, and corresponding debt/interest.

Is This Module Right for You?

The Capital module is a great fit if:

Your forecasting process captures planned asset additions (e.g., vehicles, furniture, leasehold improvements).
Planners add their proposed asset additions to their respective cost centers during the budgeting process.
Your organization reviews and adjudicates planned asset additions before finalizing the budget.

Consider Alternatives If:

You might need a different solution if:

Your primary need is to manage in-service assets and calculate depreciation, which is better suited for Oracle Cloud ERP fixed assets.
You require multi-year, request-based capital programming with budget control workflows, for which Alithya’s Capital Portfolio Planning solutions are more appropriate.
You need lightweight planning for initiatives spanning operational goals and capital additions, which might align with Alithya Initiative and Capital Planning tools.

How Does the Capital Module Work?

The Capital module simplifies the complex process of managing fixed assets and integrates seamlessly into your financial plans:

Propose New Assets: Submit requests for new tangible or intangible assets and evaluate their financial impacts.
Evaluate Asset Scenarios: Use scenario analysis to weigh the benefits of different acquisition plans.
Model Existing Assets: Optionally incorporate existing fixed assets to model future depreciation, impairments, or retirements.
Integrate Financial Statements: Consolidate asset impacts into your overall financial planning, ensuring alignment with P&L, Balance Sheet, and Cash Flow.

Proposing forecasted asset additions for next year is easy and intuitive.

Why Use the Capital Module?

Managing capital planning manually can be time-consuming and error-prone. Oracle Cloud EPM’s Capital module provides a centralized, automated framework for handling fixed assets, enabling organizations to:

Optimize capital expenditures with greater accuracy.
Plan depreciation schedules with ease.
Align asset decisions with overall business strategy and budgets.

Conclusion

Oracle Cloud EPM Capital module empowers organizations to take control of their fixed asset planning, whether for new acquisitions, capital leases, or changes to in-service assets. It provides a fast, flexible solution to ensure financial alignment and informed decision-making.

Stay tuned for the final post in this series, where I’ll discuss the Projects module and its role in managing costs for IT, marketing, and other key initiatives.

Additional Resources

Planning for Tomorrow: Unlocking the Potential of Oracle Cloud EPM Capital Module