all AP FAQS

AP FAQS

 

  Question Answer
1 What are the types of invoices? Standard, Debit memo, Credit memo,Prepayment,Retainge,Withholding invoice,Expense Report
2 What is Prepayment and Process? A prepayment is a type of invoice you enter to make an advance payment.We can adjust prepayment against standard invoice in future.
3 What are Types of Prepayment? Permanent -which is used for long term deposit. Ex:-Fixed deposit,Term deposit
Temporary-which is used for short term advance.Ex:-Advance to supplier
4 What is the use of permanent prepayment and Accounting entry? Ex:Term deposit for long term

Advance to supplier    Dr       100
To Supplier                 Cr       100

5 Batch payment process Its a 11i bulk payment for multiple supplier
6 Standard concurrent program in AP Create Accounting, period close exception report, India-Creditor ledger
7 Difference between invoice and invoice batch and what setup required? It’s either, or relation. We have to activate profile option batch% as yes. It will disable the new button at find screen at invoice.
8 Can we change invoice if we made the payment? Yes we can change if its not accounted and if the amount exceeding the previous amount otherwise can’t change.
9 What are the criteria for entering a standard invoice? Supplier, Supplier site, payment term, payment method, distribution account
10 What are the modules interfaced through AP module? Purchasing,GL
11 What is the work of payment manager? We can make payment supplier category wise and for multiple supplier payment in a one struck.
12 What are the events for close the AP period?  
13 Can we sweep invoice which is in hold position? No, We have hold and release that then we can close the period.
14 What do you mean of retention in AP? It means holding some part of payment for a contract suppler. Retain value will be release at the end of the contract. We can make through Retainage invoice.
15 What are the encumbrance options for AP? How are they used? PO encumbrance and requisition encumbrance available in Financial options.
Encumbrance used to reserve the funds at the time of raising PR or PO.
16 What are the different types of supplier site? Purchasing,Pay,Primary pay,RFQ only,Procurement card
17 How can we default supplier site at invoice level? Enable primar pay check box in supplier site for that particular site.
18 What is the use of Withholding invoice and which scenario? At the time of doing withholding tax ,this invoice used to generate.
19 What is the entry for AP invoice? Expenses Ac      Dr  100
To Supplier Ac  Cr 100
20 What is recurring invoice? What is the scenario we are using this? Repeatedly incurring invoice for expenses that occurs regularly.
Example: Rent for every month and lease payment
21 What are the methods of accounting? Accrual and Cash method
22 What is special calendar & why its required? Use the Special Calendar window to define periods that Payables uses for automatic withholding tax, recurring invoices, payment terms, and for the Key Indicators Report. For example, if you monitor staff productivity weekly, use this window to define weekly periods for the Key Indicators calendar type.
23 What types of Distribution Set and whats the use of skeleton DS? Use Full Distribution Sets to create distributions with set percentage amounts or Skeleton Distribution Sets to create distributions with no set distribution amounts. For example, a Full Distribution Set for a rent invoice assigns 70% of the invoice amount to the Sales facility expense account and 30% to the Administration facility expense account. A Skeleton Distribution Set for the same invoice would create one distribution for the Sales facility expense account and one distribution for the Administration facility expense account, leaving the amounts zero. You could then enter amounts during invoice entry depending on variables such as that month’s headcount for each group.
24 What is EB Tax and set up. How its linking to the AP and AR module? 1. Define party tax profiles 2. Define regime 3. Create Tax 4. Create tax Status 5.Create tax rate 6.update tax configuration options
25 How to create tax rates? Create tax in EB tax
26 Withholding tax and utilization It’s like TDS concept in India.
27 What is the use of Offset Account method Three types i.e. None,Balance,Account  If we selecting None then Supplier account will be same for all  OU ,If we selesting Balanceing then supplier account will seggregate for OU wise , if we select Account then its segregare All Code combination as based on real distribution account we have entered for OU wise.
28 How many types of payment method. 5 types i.e.Bills payable,Check,Electronic,Outsourced Check,Wire
29 What is pay group? It is to group invoices in to supplier category for payments.
30 What is prepayment settlement date in payable option? Number of days you want Payables to add to the system date to calculate a default settlement date for a prepayment. Payables prevents you from applying the prepayment to an invoice until on or after the settlement date.
31 What is GL date basis in payable option? The date you want Payables to use as the default accounting date for invoices during invoice entry.
Invoice Date-Invoice date you enter during invoice entry.
System Date-Current date for your Payables system. The date you enter the invoice.
Goods Received/Invoice Date-Date that you enter in the Date Goods Received field. If no value is entered, then the invoice date is used.
Goods Received/System Date-Date that you enter in the Date Goods Received field. If no value is entered, then the system date is used.
32 What is difference between debit memo and credit memo? Debit Memo: A negative change in invoiced amount identified by customer and sent to supplier. Ex.Purchase return

Credit Memo: A negative change in invoiced amount identified by supplier and sent to customer.Ex:TDS payable

33 What is meant by with-holding tax invoice? After you apply withholding tax to an invoice, you can optionally create invoices to remit withheld tax to the tax authority.
34 What are the mandatory setups in AP? Financial option,Payable option,System setup option,Create payment term,Create payment administrator,Creation of supplier,Open payable period,Open GL period,Open Inventory period,Open Purchase period,
35 Can we make foreign currency invoice and payment? Yes,but in payable option we have to enable use multiple currency and in bank,enable multi currency payments
36 Purpose of Payable invoice open interface? It can use the Payables Open Interface Import program to create Payables invoices from invoice data in the Payables Open Interface Tables
37 Payable open interface import? (Expense Report Import)? Use Payables Open Interface Import to import invoices from the Payables Open Interface Tables.
38 What is Multi Currency payments? Multi currency is possible but we have to set up at the time of Bank Creation.
39 Can we implement MRC at Payables? Yes
40 What does the Unaccounted Transaction Sweep Report do? It will sweep the transaction to next period.
41 What reports should I run before closing the period? Period close exception report,Unposted transaction
42 What is the program to transfer data from AP to GL? Transfer Journal Entries to GL   (Parameter-Ledger ,End date)
43 What is meant by void payments? When you void a payment, Payables automatically reverses the accounting and payment records so your general ledger will have the correct information, and so the status of the paid invoices is reset to Unpaid. Payables also reverses any realized gains or losses on foreign currency invoices recorded as paid by the payment
44 What are the types of journal categories available in the AP? Payable
45 What is meant by matching and what are the types of matching’s available? 2 way-Invoice and PO, 3 way-Invoice,PO and Receipt and 4 way-Invoice,PO,Receipt and Inspection
46 What is a Hold and Release? Types of hold? Hold means restriction in invoice for further processing.User can define any kind of holds to hold the invoice for further processing.
Type:-Manual and System hold
47 How to approve ‘n’ no. of invoices? You can be Approved n number of invoices using the Request “Invoice Validation”
48 What is Zero-Payment in AP? Create zero-amount payments to pay basic invoices with offsetting credit or debit memos, or to record cancelled invoices as paid so they are no longer included on the Invoice Aging Report. Before you make a zero-amount payment, you must enable the Allow Zero-Amount Payments option for the bank account you will use to create the payment.
49 What is Proxima Payment Terms? Cut off day
50 What are the tables associated with Invoice? AP_INVOICES
51 What is Interest Invoice and how it can be created? Payables automatically creates invoices to pay interest for overdue invoices if you enable automatic interest calculation for a supplier, and you pay an overdue invoice for the supplier in a payment batch or with a Quick payment. The new interest invoices are ready for Approval and payment.
52 How many key flexfields are there in Payables? No
53 Can you cancel the invoice? If yes, explain? Yes, but before create accounting
54 What is pay date basis? Due,Discount,None
55 What is terms date basis? From which date the payment term will be calculated.
Types:- System,Goods Received,Invoice,Invoice Received,Null
56 What is the report used to identify duplicate suppliers? “Supplier Audit Report” can be used to help identify potential duplicate suppliers.
57 What is meant by accrual write off? If you choose the Perpetual Accrual Method within Purchasing, Purchasing records an accounts payable liability to an AP accrual account for goods received but not invoiced. When Payables matches and approves the invoice for the received goods, Payables clears the accounts payable accrual account and records the actual liability amount to the invoice accounts payable liability account.After you have entered your receipt transactions and matched and approved your invoices, you can run the Accrual Reconciliation Report to identify any differences between your Purchasing receipts and Payables invoices.
58 Use of Future dated payments? You can use future dated payments to control the timing of your payments, and therefore control your cash flow. A future dated payment instructs your bank to disburse funds to your supplier’s bank on a specific date (the maturity date)
59 What are the period statuses in AP? Never opened,Future,Open,Closed,Permanently closed
60 Tell me steps for Period closing Process in AP?  
61 What is meant by third party payments? Payments are generally made to the supplier providing the goods or services, however sometimes there is requirement when supplier ask you to made payments to different party on supplier’s behalf.All the payments made to other parties on behalf of the supplier is termed as Third Party Payments.Refer http://eoracleapps.blogspot.in/2010/02/third-party-payments-in-oracle-payable.html
62 How to transfer funds between your internal banks? Fund transfer
63 Can I find out which invoices are matched to a PO? yes
64 ERS Invoice means? Evaluated Receipt settlement Which makes auto invoice in payable.
65 What is meant by RTS transactions? Return to supplier which has to assign at the time of creating supplier.
66 What are the steps to define a Bank? 1. User management-Role-Security wizard through Sys Admin 2.Bank branch 3. Bank Account 4.Bank Document assignment
67 How to assign Cash clearing Account While doing bank creation, we have to give cash clearing account.

 

Tell me about P2P (procure to pay) Cycle verbally as well as accounting entries?

First you enter the Requisition in PO module. Supplier sends quotation reply of requisitions or RFQ. You can approve the quotation of a supplier after to record all information received from your supplier such as terms and conditions, shipment and price breaks.

Then you can go ahead for Purchase Agreement. Purchase Agreement has two types: first Blanket and Contract Purchase Agreement. You cans use blanket purchase agreement to communicate to those supplier that are negotiating pricing before actually releasing firm purchases. A blanket purchase agreement must have detailed information besides the header level information. A blanket purchase agreement contains lines for specific terms, quantity, promised date, need-by-date and prices.

You can create a contract purchase agreement with a supplier to agree on terms and conditions without entering into and agreement for specific items or services. A contract purchase agreement can support competitive solicitation through the RFQ process and then through the purchase releases because a contract purchase agreement has only header level information and no detailed information. Header level includes terms, currency Supplier and a supplier site. You can enter Purchase Order for confirms to purchasing services or goods. Purchase order has four types: Standard, Planned, Blanket and Contract.

Whenever you get goods or service that time you enter receipts in system. There are five types of receipts: manual receipts, express receipts, cascade receipts, unordered item receipts and substitute item receipts. That time accounting entry should be debited to Inventory Material Value and credited to Payable Clearing Account.

Whenever you get the invoice in account department, it enters in the system that time accounting entries should be debited Payable Clearing and credited to Payable. Then you make a payment to supplier that time accounting entries should be debited Payable liability and credited to cash clearing account. After reconciliations between cash management and bank, accounting should be debited to cash clearing account and credited to bank or cash account.

Accrual Accounting – Perpetual Accrual (On Receipt)

Enter purchase order (1)

When you enter a purchase order, accounts are created and stored with the purchase order distribution.  The accounts will eventually be used as a basis for creating accounting that is sent to the general ledger.  Creating a purchase order in and of itself generates no accounting that is sent to the general ledger.

Receive (2)

When you accrue on receipt, processing a receiving transaction automatically sends a receipt accrual to the general ledger.  The Receiving Inventory Account is debited (quantity x purchase order line unit price) and the Inventory AP Accrual account (uninvoiced receipts account) is credited the same amount.  Run the Journal Import process with a source of Purchasing to create unposted journals in the general ledger.

Deliver and cost (3)

After delivering to the final destination, the Receiving Inventory Account is cleared and the Material account is debited.  If you use standard costing, the Material account is debited with the standard cost of the item and any difference is charged to the Purchase Price Variance account.

Period end accrual (4)

When items are accrued on receipt, no period-end accrual is generated by the Receipt Accruals – Period-End process.  The receipt accrual is automatically generated when the receipt is processed.

Invoice and match (5)

Entering an invoice and matching creates a debit to the Inventory AP Accrual account to clear the liability for the uninvoiced receipt (you now have an invoice).  Thecredit is to the AP Liability account that defaults from the supplier site if the invoice unit price is the same as the purchase order line unit price.  Any difference is charged to the Invoice Price Variance account.  For items with destination type of Inventory, the Invoice Price Variance account will be the Invoice Price Variance account specified when you defined Inventory Information for your inventory organizations in the Other Accounts tab.  The AP Liability account is cleared when the invoice is paid.

Accounting for Mass Additions – Periodic Accrual (Period End)

Enter purchase order (1)

When you enter a purchase order, accounts are created and stored with the purchase order distribution.  The accounts will eventually be used as a basis for creating accounting that is sent to the general ledger.  Creating a purchase order in and of itself generates no accounting that is sent to the general ledger.

Receive (2)

For most expenses and asset purchases (other than inventory), receipt accruals are generally processed at period end, so no accounting is transferred to the general ledger at the time the receipt is processed.

Period end accrual (3)

If no invoice is received and matched to the purchase order at period end, the Receipt Accruals – Period End process will generate an accrual that is transferred to the GL Interface.  Run the Journal Import process to create unposted journals in the general ledger.

Reverse accrual (4)

Perpetual accruals (on receipt accruals) are reversed when the invoice entered in Payables is matched to the purchase order.  Periodic accruals (period end accruals) are reversed when a reversing journal is created and posted in the general ledger.

Invoice and match (5)

Entering an invoice and matching creates a debit to the Inventory AP Accrual account to clear the liability for the uninvoiced receipt (you now have an invoice).  The credit is to the AP Liability account that defaults from the supplier site if the invoice unit price is the same as the purchase order line unit price.  Any difference is charged to the Invoice Price Variance account.  For items with destination type of Expense, the Invoice Price Variance account will be the same as the charge account.  In the case of an asset that will be capitalized and depreciated in assets, the charge account is an asset clearing account associated with an asset category in Assets.  The AP Liability account is cleared when a payment is processed.

Post asset to Assets (6)

The Post Mass Additions process places the asset in service.  When the Create Journal Entries process is run in Assets, the charge account (the clearing account on the invoice distribution) is relieved and the cost account associated with the asset category is charged for the cost of the asset.

Enter invoice (1)

A standard, unmatched invoice entered into Payables will generate a credit to the AP Liability account and a debit to the charge account specified on the invoice distribution. For expenses, this will be an income statement account; for assets that will be capitalized in Assets and depreciated, this account will be a balance sheet account (asset clearing account); for inventory received, the account will be the Inventory AP Accrual account.

 

Pl. describe the P2P process in terms

Procure to Pay Process

Demand

The procurement process generates and manages requests for the purchase of goods.  The demand for purchase items may be a one-time event or may recur in either predictable or random time intervals.

Source

The procurement sourcing process covers the business activities related to the search, qualification, and selection of suitable suppliers for requested goods and services.

Order

The procurement ordering process includes purchase order placement by the buying organization and purchase order execution by the supplying organization.

Receive

The receipt process acknowledges that a purchase order has been duly executed.  For orders of physical goods, it will typically include the receipt, inspection and delivery of the goods to inventory or to another designated location.  For orders of services, it will typically consist of a notification from the requester or the approving person that the service has been performed as agreed.

Invoice

The invoice process includes entering supplier and employee invoices.

 

Pay

The payment process consists of those activities involved in the payment for ordered goods and services.

 

Definitions of Purchasing Document

Blanket Purchase Agreement: It committed amounts for specific date range for service or goods.

Contract Purchase Agreement: It committed amount for certain period of unspecified goods.

Purchase Order types:

Standard: It is regular purchases order to represents your order to the supplier.

Planned: It is a purchase order before you actually order the goods and services.

Blanket: It is entering to against of blanket purchase agreement.

Contract: It is entering to against of contract purchase agreement.

Types of receipts:

Manual: It is for inputting data manually.

Express: It is a quicker method-if you have specified PO then requires fewer keystrokes.

Cascade: It is assists in the distributions of the quantity of a receipt from a single supplier to multiple shipments and distributions.

Unordered: When you are missing a PO or if you’re not sure to which PO the receipt should be matched against, you can enter this type receipt.

Substitute Item: If you do not have any information for the Order Information alternative region then you enter a receipt for substitute item.

Quotation: It is used for quotes from the supplier regarding prices, terms and conditions of items.

RFQ: It is used for soliciting quotes from the supplier regarding prices, terms and conditions of items.

Purchase Release: It is used for releases against other document types, there are two subtypes for this: Blanket and Schedule.

Entering Invoices Overview

You can manually enter supplier invoices in either the Invoice Workbench or the Quick Invoices window. You can match to purchase orders when entering these invoices.

Invoice Workbench

(Invoice Batches window, Invoices window, Distributions window, and the associated windows). Use the Invoice Workbench to enter any invoice directly into the Payables system. You use this instead of the Quick Invoices window when entering complex invoices or invoices that require online validation and defaulting. Also, use this window when entering an invoice that needs immediate action, such as payment.

Quick Invoices window

Use the Quick Invoices window for high–volume invoice entry for invoices that do not require extensive validation and defaults. After entering invoices in the Quick Invoices window, import them into Payables. Validation and defaulting occurs during import.

Creating Invoices Automatically

Recurring Invoices

You can set up your system to automatically create periodic invoices, for example, rent invoices.

RTS Invoices

If you use Return to Supplier feature in Oracle Purchasing, the system creates these debit memos directly in your Payables system.

Retroactive Price Adjustment Invoices.

If Oracle Purchasing users use the Retroactive Pricing of Purchase Orders feature, the system automatically creates Adjustment and PO Price Adjustment invoices.

 

Pl. describes the setup of AP?

Setup steps unique to AP: Ledger Selection, Payment Terms, Invoices Tolerances, Invoice Approval Codes, Distributions Sets, Expense Report Templates, IT Regions, Define Banks, Automatic Payments, Special Calendars, Payable System Options, Payable Options, Financials Options, Profile Options and Open Accounting periods.

There are many sets up that are unique to Oracle Payables’ implementation. The primary Ledger selection specifies the accounting structure, the functional currency, and the accounting calendar used by Payables. Payment terms define payment schedules and corresponding discounts. Invoice tolerances definitions control the amount of variance allowed between invoices, purchase orders, and receipts when matching is performed. Various codes are defined in Payables. Because invoice approval codes are used to apply or release invoice holds, they should be descriptive and meaningful. Many setups facilitate and speed up data entry, and distribution sets are predefined allocation structures that can be used to populate invoices with preassigned distributions. Expense report templates can be defined and created with commonly used expense items to populate expense report lines. Certain setups relate to tax reporting functionality.

In the financial options setup, you select a Ledger and an inventory organization. You also define accounting, budgetary control, encumbrance, payment, personnel, purchasing, VAT registration, and vendor options. To support payment processing, payment format and banks must be defined, and reporting formats can be defined to provide expense reports and aging reports that better meet the user’s business requirements. Special calendars can be created to further customize the recurring invoices, automatic withholding tax, and key indicators reports. In addition, users can define descriptive flexfields to capture additional data that was not previously captured in Oracle Payables.

Payables options control and set defaults for Payables functions. It should be noted that if the Automatic Offset feature in the Accounting region is enabled, the user cannot allow reconciliation accounting, enable withholding tax, or allow adjustments to paid invoices. In addition, the journal entries creation mode determines whether audit entries will be created for the liability, gain or loss, rounding, discount taken, and cash clearing journals. As in Purchasing, default values can be specified in these options regions. Certain default values will default based on a hierarchy. For example, the tax name will default by a user-defined hierarchical order.

 

How many types of Invoices?

There are Eleven types of invoices: Standard, Debit Memo, Credit Memo, Expense Report, PO Default, Prepayment (Temporary and Permanent), Quick-Match, Mixed, With-Holding, Interest, Retainage Release, Transportation Invoices and Three Special Type of invoices which generated automatically: Recurring, RTS, Retroactive Price Adjustment.

Standard

An invoice from a supplier representing an amount due for goods or services purchased. Standard invoices can be either matched to a purchase order or not matched.

Credit Memo

A memo from a supplier representing a credit amount toward goods or services.

Debit Memo

An invoice you enter to record a credit for a supplier who does not send you a credit memo.

Mixed

An invoice type you enter for matching to both purchase orders and invoices. You can enter either a positive or a negative amount for a Mixed invoice type.

Prepayment

A type of invoice you enter to pay an advance payment for expenses to a supplier or employee.

Expense Report

An invoice representing an amount due to an employee for business-related expenses.

Withholding Tax

An invoice you enter to remit taxes withheld to the appropriate tax authority.

Interest

If you allow interest invoices, payables will automatically calculate interest for overdue invoices and create interest invoices for selected suppliers.

QuickMatch

This invoice provides you with an alternative way to match an invoice to all PO shipments. To perform a QuickMatch, you must enter the PO number. The PO number defaults the supplier, the supplier number, the supplier site, and the currency. QuickMatch matches an invoice to all PO shipments, while a PO default match allows you to pick and choose.

Retainage Release

Invoices created for complex work and advance contract financing.

Transportation Invoices

Invoices from freight payment.

Creating Invoices Automatically

Recurring Invoices

You can set up your system to automatically create periodic invoices, for example, rent invoices.

RTS Invoices

If you use Return to Supplier feature in Oracle Purchasing, the system creates these debit memos directly in your Payables system.

Retroactive Price Adjustment Invoices.

If Oracle Purchasing users use the Retroactive Pricing of Purchase Orders feature, the system automatically creates Adjustment and PO Price Adjustment invoices.

 

 

Tell me about Prepayment / expense Report?

Expense Report is used for invoices that reimburse the employee’s expenses.

Prepayment used for to pay prepayment to suppliers, employees and Government Authorities. There are two types of prepayment: temporary for suppliers and employees, permanent for to pay deposit with government authorities.

Temporary prepayments can be applied to invoices or expense reports you receive. For example, you use a Temporary prepayment to pay a hotel a catering deposit. When the hotel’s invoice arrives, apply the prepayment to the invoice to reduce the invoice amount you pay. Permanent prepayments cannot be applied to invoices. For example, you use a Permanent prepayment to pay a lease deposit for which you do not expect to be invoiced.

 

Match Approval Level Options

The match approval level defaults to purchase order shipment lines when the purchase order is entered.  You can override the default on the purchase order shipment.  If you find that you are frequently overriding this value, change the default at the supplier site level.

If an item is used on the PO, the match approval level will default from the item and will override the supplier site. If the Item match approval level for the Item = Receipt required, then it results in a 3-way match. If the Item match approval level for the Item = Inspection required, then it results in a 4-way match.

When quantities and prices exceed specific tolerances you define, the Payables Validation process will place a matching hold on the invoice.  You can configure matching holds so manual override is not possible in the Invoice Holds and Release Names window.

2-Way (Invoice to Purchase Order)

*        Quantity billed vs. quantity ordered on shipment line

*        Invoice unit price vs. purchase order line unit price

3-Way (Invoice to Purchase Order and Receipt)

*        2-Way match criteria AND

*        Quantity billed vs. quantity received

*        Item = Receipt Required

4-Way (Invoice to Purchase Order and Receipt and Inspection)

*        3-Way match criteria AND

*        Quantity billed vs. quantity accepted

Note:  Quantity accepted = (Quantity received – quantity rejected)

*        Item = Inspection Required

How many scenarios of matching invoices in AP?

When an invoice for the PO arrives in the payables department, the supplier invoice is entered into the system and PO shipments/distribution can then be matched to the supplier’s invoice. The matching method ensures you pay suppliers only for the items that you have agreed to purchase and at the price stated on the purchase order within the set tolerances.

Matching invoices to purchase orders by enforce two-way, three-way, and four-way matching. At the simplest level—known as two-way matching—matching compares invoice amount and quantity with the amount and quantity of the matched purchase order. The invoice can only be approved if the amount and quantity match to the purchase order within a predefined tolerance. In addition to requiring two-way matching, users can also enforce matching of the invoice amount and quantity to that received (three-way matching), and to that inspected (four-way matching).

QuickMatch provides you with an alternative way to match an invoice to all PO shipments. To perform a QuickMatch, you must enter the PO number. The PO number defaults the supplier, the supplier number, the supplier site, and the currency. QuickMatch matches an invoice to all PO shipments, while a PO default match allows you to pick and choose.

 

Purchase order shipment match

Based on the quantity invoiced, Payables prorates the match amount across all non-fully billed purchase order distributions associated with the purchase order shipments you match to.

Receipt match

Reasons to use match to receipt:

*        Matching to receipts allows you to pay only for goods you receive.

*        Any exchange rate variance that results from matching is likely to be smaller because the time between the receipt and invoice will probably be less than the time between the purchase order and invoice.

*        Matching an invoice for freight or miscellaneous charges to a material receipt is required for accurate costing data if you use periodic costing.

Note that you can also only pay for what you receive by using Match to PO and letting the invoice go on hold if the receipt is not in.

Purchase order distribution match

If you are billed for only a portion of a shipment, you may want to match at the distribution level to ensure you charge the correct account.  If you choose not to match to the distributions, Payables prorates the match amount across the available distributions for that shipment.

Price correction

You may want to record a price correction for a purchase order shipment if you receive an invoice from the supplier that is an adjustment to the unit price of an invoice you previously matched to that purchase order shipment. Price corrections adjust the unit price without adjusting the quantity billed on the purchase order.

Reasons to use price correction:

*        You use a price correction when a supplier sends an invoice for a change in unit price for an invoice you have already matched to a purchase order. If you simply enter an invoice for a unit price increase or a credit/debit memo for a unit price decrease without using price correction, invoice price variances will not be accurate.

*        You can enter and match an invoice to record a price increase, or you can enter and match a credit memo or debit memo to record a price decrease.

*        Use a price correction to adjust the invoiced unit price of previously matched purchase order shipments, distributions, or receipts without adjusting the quantity billed.

Note:  Price corrections are very different from overriding the unit price when matching an invoice to a purchase order.  When you are entering an invoice and matching to a purchase order, you can override the unit price that defaults from the purchase order so it is the same as the unit price on your invoice.  You use price corrections only after the initial match.

Matching to Distributions for Assets

The charge account on the purchase order for an item that will be capitalized and depreciated is a balance sheet account and will be a clearing account associated with an asset category (like COMPUTER-PC) in Assets.  After matching, the asset clearing account will be on the distribution for the invoice.  When the asset is prepared and posted to Assets, the clearing account is cleared and the asset cost account associated with the asset category is charged for the cost of the asset.  Payables will transfer the asset clearing account to the general ledger and Assets will transfer the clearing account clearing entry and the asset cost entry.

Matching to Distributions for Expenses

The charge account on the purchase order for an item that will be expensed (for example, office supplies) is an income statement account.  After matching, the expense account is transferred to the invoice distribution if you are accruing at period end.  When accounting is transferred to the general ledger, the amount charged to the expense account can be reported on the income statement.

Matching to Distributions for Inventory

The charge account on the purchase order for an item that will be capitalized as inventory is a balance sheet account and will be a material clearing account associated with an inventory organization in Inventory.  After matching, the Inventory AP Accrual Account will be on the distribution for the invoice.  When the receipt is processed the AP Accrual Account (uninvoiced receipts account) is credited.  When booking the invoice and matching, the receipt is now invoiced and the balance in the AP Accrual Account must be cleared.  At receipt, Purchasing will transfer the accrual to the AP Accrual Account (a credit) and after matching, Payables will transfer the clearing entry to the AP Accrual Account as part of the Transfer Journals to GL process.

 

Multiple Organization Access Control

Oracle Payables leverages Oracle Applications’ Multiple Organization Access Control feature. Multiple Organization Access Control (MOAC) lets you define multiple organizations and the relationships among them in a single installation of Oracle Applications. These organizations can be ledgers, business groups, legal entities, operating units, or inventory organizations.

Implement Multiple Organization Access Control

*        If you implement MOAC, you can enter invoices for multiple operating units without switching responsibilities. To enter an invoice for an operating unit, enter a value in the Operating Unit field of the Invoices window (part of the Invoice Workbench). Each invoice must be for a single OU, but you can enter multiple invoices for different OUs, without changing responsibilities.

*        Pay invoices for multiple operating units in a single pay run.

Set Up Multiple Organization Access Control

To set up MOAC, define the following profile options:

*        MO Security Profile. This option controls the list of operating units that a responsibility or user can access. So you would assign the Security Profile that you just created to this profile option. If you set the this option at the responsibility level, then all users using that responsibility will have access to only the operating units available in the security profile. If you set this option at the user level, then the user will have access to only those operating units, irrespective of the applications responsibility that they log into.

*        MO: Default Operating Unit. This option allows you to specify a default operating unit that will be the default when you open different subledger applications (Payables, Receivables, and so on) pages. Because users can access multiple operating units, you may want to set up a default one instead of forcing users to constantly have to choose one. With User Preferences, you can also specify a default operating unit at the user level. This profile option is optional.

*        MO: Operating Unit. This option provides backwards compatibility and supports products that do not use MOAC. If you specify a security profile for the MO: Security Profile, then those products that use MOAC will ignore this option.

New Payment Terminology in R12

Key concepts that are new to Payables in R12 include the following:

Document Payable. A document to be paid by the deploying company (Payer) and it may represent, for example, a Payables invoice or scheduled payment.

Pay Run/Payment Process Request. A pay run is a broad term, which describes the process by which a group of invoices is selected and processed for payment. It is roughly equivalent to the Release 11i concept of a payment batch. The term Pay Run is often used interchangeably with the term Payment Process Request. A payment process request is technically a request created by a source product for Oracle Payments payment services. The payment process request, which originates in the source product during the invoice selection process, contains one or more documents payable to be paid. During the payment process, the documents payable in the payment process request are built into payments.

Payee. The person or organization that is being paid, for example, the supplier, employee, or customer to whom the payment is made.

Payment Instruction. A payment instruction is a collection of payments, along with aggregate payment information, that is formatted. Depending on the setup, a payment instruction may be converted into a file to be printed onto checks or into a payment file that is transmitted to a payment system for further processing and disbursement.

Payment Process Profile. A payment process profile is a payment attribute assigned to documents payable, which specifies handling of the documents payable, payments, and payment instructions. Payment process profiles including specifications for payment instruction formatting and transmission.

Payment process profiles contain the following information:

*        payment instruction formatting information

*        transmission information

*        payment grouping

*        payment limits

*        payment sorting details

Payment Process Request Template. A blueprint that simplifies and expedites pay runs by preselecting pertinent payment data, such as general header information, payment selection criteria, payment attributes, processing instructions, and how validation failures are handled.

Payment Format. A set of rules that determine how a payment instruction or settlement batch is converted into a payment file, readable by a payment system. Payment formats are registered and maintained in Oracle XML Publisher.

Payment Method. A payment attribute on a document payable. The payment method indicates the medium by which the deploying company (first party payer) makes a payment to a supplier (third party payee). Examples of payment methods are checks printed in-house by the payer, checks outsourced to the bank for printing, and wires.

Open Interfaces

Use the following open interfaces to import data into Payables from other applications or third-party solutions:

*        Payables Open Interface

*        Payables Expense Report Open Interface

*        Payables PCard Open Interface

*        Payables Credit Card Open Interface

*        Payables Matching Open Interface

*        Payables Supplier Open Interface

*                    Payables Invoice Open Interface

Use the Payables Invoice Open Interface to load invoices from a variety of sources including invoices generated from the Pay on Receipt Autoinvoice process, EDI invoices generated by the e-Commerce Gateway, invoices from credit card and procurement card transactions and invoices from external systems.  You can load standard invoices as well as credit memos using the Payables Invoice Open Interface.  Once invoices are loaded, use the Payables Open Interface Import process to validate them and load them into Payables.

Payables Expense Report Open Interface

Accounts Payable teams can key paper invoices using the expense reports form or employees can submit their own expense reports using iExpenses.  Run the Payables Invoice Import process to validate expense report data and create expense reports in Payables.

Payables PCard Open Interface

You can streamline your procure-to-pay process by implementing a procurement card program.  Employees purchase items directly from suppliers using a credit card and then the credit card issuer sends transaction files directly to your company. You can import credit card transaction files from your card issuer directly into Payables helping you reduce transaction costs and eliminate low dollar value invoices.

Payables Credit Card Open Interface

Use SQL*Loader scripts to load credit card transactions for corporate credit (travel) cards into the open interface if you are using a credit card program.  Corporate credit (travel) cards are similar to procurement cards but are generally used for travel expenses.  After transactions are validated, you include them in expense reports you enter through the Self Service Web Applications.

The following predefined SQL*Loader control files come delivered with Oracle Applications:

*        American Express

*        Diner’s Club

*        GE Capital MasterCard

*        US Bank Visa

*                    Payables Matching Open Interface

*              Use SQL*Loader to load the required information into the purchasing interface tables. You will need to create a SQL*Loader control file to format the information you want to load. The file you write will vary greatly depending on the nature and format of the flat file you use.  You match invoices to purchase order shipments during invoice entry.

*                    Payables Supplier Open Interface

*              Use the Payables Supplier Open Interface to load supplier data from external systems.  You can load suppliers, supplier sites, and supplier contacts using the Payables Supplier Open Interfaces.  Once supplier data is loaded, use the Payables Supplier Open Interface Import process to validate them and load them into Payables.

Supplier – Accounting

Use the Supplier : Accounting page to define the default accounting information for your suppliers and supplier sites.

Liability

The Liability Account and description for a supplier site’s invoices. If you use the Multiple Organization Support feature, you can enter a value in this field only at the supplier site level.

Prepayment

The supplier default for this field is the Financials option for the Prepayment account. If you use the Multiple Organization Support feature, you can enter a value in this field only at the supplier site level.

Bills Payable

If you use bills payable (future dated payments), enter the account you want to use. The Financials option value defaults to new suppliers, and the supplier value defaults to new supplier sites. You can override these defaults. When Payables creates a future dated payment, it uses the future dated payment account from either the supplier site or the payment document, depending on which option you select in the Payment Accounting region of the Payables Options window.

If you relieve liability for future dated payments when the payment is issued, then use an asset account. If you relieve liability at clearing time, then use a liability account.

If you use the Multiple Organization Support feature, you can enter a value in this field only at the supplier site level.

Distribution Set

The default Distribution Set for all invoices entered for the supplier site. Distribution Sets are used to expedite entry of distribution lines on invoices.

*        Full distribution sets will automatically create distribution lines with both account numbers and currency amounts.

*        Skeleton distribution sets will automatically create distribution lines with only account numbers and you must provide the currency amounts.

Define additional Distribution Sets for the list of values in the Distribution Set window. If you use the Multiple Organization Support feature, you can enter a value in this field only at the supplier site level.

Invoice Workbench

The Invoice Workbench is a group of windows that you can use to enter complex invoices or invoices that require online validation and defaulting. Also, use the Invoice Workbench when entering an invoice that needs immediate action, such as payment.

The primary window in the Invoice Workbench is the Invoices window. The Invoices window is divided into the following regions:

*        Invoice Header

*        General

*        Lines

*        Holds

*        View Payments

*        Scheduled Payments

*        View Prepayment Applications

These regions are described in detail in this presentation.

From the Invoices window you can also access the other invoice-related features and windows that comprise the Invoice Workbench:

*        Actions. Opens the Invoice Actions window for a selected invoice(s) which you can use to perform actions such as validating, approving, cancelling, or printing.

*        Calculate Tax. Automatically generates the tax lines for the invoice based on the E-Business Tax setup.

*        Tax Details. Opens the Tax Lines Summary window, which displays the tax lines on the invoice.

*        Corrections. Opens the Corrections window, which allows you to enter a price, quantity, or amount correction.

*        Quick Match. Automatically matches the selected invoice to open, unbilled purchase order lines for the specified supplier.

*        Match. Allows you to start one of the following matches, based on the invoice you select. Select the invoice you want to match to from the poplist, then choose the Match button. If you enter a positive amount invoice, then Payables defaults either Purchase Order or Receipt, based on the Invoice Match option of the supplier site.

–          Purchase Order. Match a selected invoice to a purchase order.

–          Receipt. Match a selected invoice to a purchase order receipt.

–          Credit Memo. Match a selected credit/debit memo to an invoice.

*        All Distributions. Opens the Distributions window to view all distributions for a selected invoice.

*                    Distribution Sets

*              You can assign a default Distribution Set to a supplier site so Payables will use it for every invoice you enter for that supplier site. If you do not assign a default Distribution Set to a supplier site, you can always assign a Distribution Set to an invoice when you enter it.

*              For example, you can create a Distribution Set for an advertising supplier that allocates advertising expense on an invoice to four advertising departments.

*              Full Distribution Sets

*              Use Full Distribution Sets to create distributions with set percentage amounts, or use Skeleton Distribution Sets to create distributions with no set distribution amounts. For example, a Full Distribution Set for a rent invoice assigns 70% of the invoice amount to the Sales facility expense account and 30% to the Administration facility expense account.

*              Skeleton Distribution Sets

*              A Skeleton Distribution Set for the same invoice would create one distribution for the Sales facility expense account and one distribution for the Administration facility expense account, leaving the amounts zero. You could then enter amounts during invoice entry depending on variables such as that month’s headcount for each group.

*              If you enable and use a descriptive flexfield with your distribution set lines, the data in the flexfield will be copied to the invoice distributions created by the Distribution Set.

*              Importing Invoices with Distribution Sets

*              If you are importing invoices, enter a Distribution Set before you import the invoice record.

*              You can provide account information from only one of the following sources or the invoice will be rejected during import: Distribution Set, purchase order, Account field, allocation of a non–Item type line, or Projects information. Import will reject the invoice record if you use a Skeleton Distribution Set and use the Allocate feature for the same line.

*                    Invoice Distribution Types

*              Type

*              Select a distribution Type. Each invoice distribution will have one and only one distribution type. If you are using periodic costing and need to include the cost of freight and miscellaneous charges with a receipt, you must use the Allocation window to allocate those distributions to a distribution line created by the matching process.

*              In addition to the Item, Freight, Miscellaneous, and Tax types, described previously, you can also have the following distribution types.

*              Withholding

*              Records the amount of taxes withheld from an invoice.

*              Prepayment

*              Records the amount of a prepayment applied to an invoice.

*              Amount

*              The amount of the distribution.

 

 

Adjustment and PO Price Adjustment Invoices

The two types of adjustment invoices are:

PO Price Adjustment Invoice

This invoice is for the difference in price between the original invoice and the new purchase order price. PO price adjustment invoices can be matched to both purchase orders and invoices.

Adjustment Invoice

This invoice effectively reverses any outstanding regular Payables price corrections and PO Price Adjustment invoices. This is so the PO Price Adjustment document can be for only the price difference between the original invoice and the new PO price.

These adjustment invoices can be positive, negative, or zero amount. When the original invoice and its related adjustment documents are paid, the net effect is as if the original invoice had always had the new price. The supplier is paid the appropriate amount, and the accounting is adjusted accordingly.

You cannot manually enter these types of invoices, nor can you adjust or cancel them. You can view, report on, validate, account for, and pay them.

Invoice Import

Oracle Internet Expenses expense reports

Expense reports your employees enter using a Web browser.

Payables expense reports

Expense reports entered in the Payables Expense reports window by the Payables department.

Credit Card invoices

Invoices for employee credit card expenses. The credit card company sends you these invoices as a flat file.

EDI Invoices

Electronic invoices transferred from Oracle e–Commerce Gateway.

XML Invoices

Electronic invoices transferred from the Oracle XML Gateway. See: XML Invoices, Oracle Payables Implementation Guide.

Invoices from external systems

Invoices, such as invoices from legacy systems, loaded using SQL*Loader.

Oracle Property Manager invoices

Lease invoices transferred from Oracle Property Manager.

Oracle Assets lease payments

Lease payments transferred from Oracle Assets.

Invoice Workbench

The Invoice Workbench is a group of windows that you can use to enter complex invoices or invoices that require online validation and defaulting. Also, use the Invoice Workbench when entering an invoice that needs immediate action, such as payment.

The primary window in the Invoice Workbench is the Invoices window. The Invoices window is divided into the following regions:

*        Invoice Header

*        General

*        Lines

*        Holds

*        View Payments

*        Scheduled Payments

*        View Prepayment Applications

These regions are described in detail in this presentation.

From the Invoices window you can also access the other invoice-related features and windows that comprise the Invoice Workbench:

*        Actions. Opens the Invoice Actions window for a selected invoice(s) which you can use to perform actions such as validating, approving, cancelling, or printing.

*        Calculate Tax. Automatically generates the tax lines for the invoice based on the E-Business Tax setup.

*        Tax Details. Opens the Tax Lines Summary window, which displays the tax lines on the invoice.

*        Corrections. Opens the Corrections window, which allows you to enter a price, quantity, or amount correction.

*        Quick Match. Automatically matches the selected invoice to open, unbilled purchase order lines for the specified supplier.

*        Match. Allows you to start one of the following matches, based on the invoice you select. Select the invoice you want to match to from the poplist, then choose the Match button. If you enter a positive amount invoice, then Payables defaults either Purchase Order or Receipt, based on the Invoice Match option of the supplier site.

–          Purchase Order. Match a selected invoice to a purchase order.

–          Receipt. Match a selected invoice to a purchase order receipt.

–          Credit Memo. Match a selected credit/debit memo to an invoice.

*        All Distributions. Opens the Distributions window to view all distributions for a selected invoice.

Match Approval Level Options

The match approval level defaults to purchase order shipment lines when the purchase order is entered.  You can override the default on the purchase order shipment.  If you find that you are frequently overriding this value, change the default at the supplier site level.

If an item is used on the PO, the match approval level will default from the item and will override the supplier site. If the Item match approval level for the Item = Receipt required, then it results in a 3-way match. If the Item match approval level for the Item = Inspection required, then it results in a 4-way match.

When quantities and prices exceed specific tolerances you define, the Payables Validation process will place a matching hold on the invoice.  You can configure matching holds so manual override is not possible in the Invoice Holds and Release Names window.

2-Way (Invoice to Purchase Order)

*        Quantity billed vs. quantity ordered on shipment line

*        Invoice unit price vs. purchase order line unit price

3-Way (Invoice to Purchase Order and Receipt)

*        2-Way match criteria AND

*        Quantity billed vs. quantity received

*        Item = Receipt Required

4-Way (Invoice to Purchase Order and Receipt and Inspection)

*        3-Way match criteria AND

*        Quantity billed vs. quantity accepted

Note:  Quantity accepted = (Quantity received – quantity rejected)

*        Item = Inspection Required

 

*                    Tell me about Quick Invoices

*              You use the Quick Invoices window for your everyday entry of invoice records. You use this window for rapid, high–volume entry of Standard and Credit Memo invoices that are not complex and do not require extensive online validation or defaulting of values during entry. You can use this window for purchase order matching and for applying prepayments to the invoice you are entering.

*              The information entered in the Quick Invoices window is stored in the Payables Open Interface tables. Because the system performs limited validation and defaulting of invoice values while you are entering invoices, you can enter invoices more quickly in the Quick Invoices window than you can in the Invoice Workbench.

*              You can use the Quick Invoices window if you want to use the Open Interface Workflow. You can customize the Open Interface Workflow to process your invoice records before you import them. For example, you can perform custom validation of cost center information before you submit import.

*              Note: Speed up invoice record entry by customizing Quick Invoices folders. You can resize, rename, move, and hide fields to meet your needs.

*                    Quick Invoice Process

*              When you enter invoice records in the Quick Invoices window, you can submit a customized workflow program to automate your processes for managing invoices. For example, you can customize the workflow program to validate the cost center on all invoices before you import them.

*              The invoice records you enter in the Quick Invoices window are stored in interface tables: AP_INVOICES_INTERFACE and AP_INVOICE_LINES_INTERFACE.

*              These tables store invoice header and line information.

*              Import invoice records by using the Create Invoices window, or by submitting the Payables Open Interface Import Program from the Submit Request window.

*              Payables validates the invoice records during import and creates invoices with distributions and scheduled payments.

*              After import, Payables provides a report that lists invoice records that were successfully imported and any that could not be imported because they had invalid or missing information. You can query the rejected invoice records in the Quick Invoices window, correct them, and then resubmit them for import.

*              When you import invoice records successfully, Payables creates regular invoices that you can view, modify, and validate in the Invoice Workbench.

*              After you successfully create invoices based on data in the invoice records, you can purge the invoice records from the Open Interface tables.

*                    Quick Invoice Batches

*              You can use the Quick Invoices Batch name to query the group of invoice records in the Quick Invoices window, and to identify a group of invoice records that you want to import together.

*              Note that if you use invoice batch control and you want to maintain the grouping of invoices after import, then when you submit import for the Quick Invoices batch, you can assign an Invoice Batch name to the group of invoices that Payables creates.

*              You can then use the Invoice Batch name to query the same group of invoices in the Invoice Workbench.

 

Entering Recurring Invoices

Recurring Invoice Template

With a recurring invoice template, you can do the following:

*        Specify the intervals in which invoices based on the recurring invoice template will be created.

*        Create up to two special one–time invoice amounts of a non–standard amount, such as a deposit or balloon payment.

*        Define recurring invoices to increase or decrease by a fixed percentage from period to period.

When Payables creates recurring invoices, the invoice date is the first date of the period in which the recurring invoice is created. The Terms Date depends on the Terms Date Basis setting at the supplier site, but is calculated differently than for regular invoices:

*        If the Terms Date Basis is set to System Date, then the Terms Date is the same date that the recurring invoice was created.

*        If the Terms Date Basis is set to anything else, then the Terms Date is the invoice date, which is the first day of the period in which the recurring invoice is created.

Special Calendar

You use the Special Calendar window to define periods that Payables uses for automatic withholding tax, recurring invoices, payment terms, and for the Key Indicators Report. For example, if you monitor staff productivity weekly, use this window to define weekly periods for the Key Indicators calendar type.

The Report Run display–only check box indicates that a Key Indicators Report has been run for this period. The check box is not applicable to Payment Terms, Withholding Tax, or Recurring Invoices calendar types.

Note: The periods you define in the Special Calendar window are completely separate from the periods you define in the Accounting Calendar window for your AP Accounting Periods.

 

  • How many Levels of Invoice Validation

System level validation

Manually submit the Payables Invoice Validation process or schedule it to run periodically from the Submit Request window. Submit the Payables Invoice Validation process right before you process payments to update the status on all invoices. Payables will use the Option parameter to select unvalidated invoices for validation.  Enter All to ensure you release any existing holds on invoices as well as place new holds. Otherwise, Invoice Validation reviews only those invoice distributions that were not already reviewed by Invoice Validation. Optionally, enter other criteria to submit Invoice Validation for specific groups of invoices.

Batch level validation

Submit Invoice Validation for one or more invoice batches from the Invoice Batches window. Batch level validation is only allowed if the Allow online validation Payables option is enabled also.

Invoice level (online) validation

If the Payables option to allow online validation is enabled, you can submit online validation for one or more individual invoices when an invoice must be validated and paid immediately. You can also validate related invoices for credit and debit memos by choosing Validate Related Invoices in the Actions window after you enter a credit or debit memo.

Invoice level (online) validation is only allowed if the Allow online validation Payables option is enabled also.

Validation and Approval

The order of the Invoice Validation process and Invoice Approval Workflow Program is based on the Approval Processing Sequence Payables option. For example, you might want to validate before you approve to create tax lines and distributions for your invoices.

 

 

Approval

You might want to enable the Require Validation Before Approval Payables option if your approvers need to review tax details before they approve an invoice.

Invoice Selection Criteria

An invoice must meet all of the following criteria to be processed:

  1. If the Require Validation Before Approval Payables option is enabled, or if the invoice was submitted by a Supplier using iSupplier Portal, then the invoice must be validated.
  2. The Approval field value in the Invoices window must be:

–          Required, if you submit the workflow program from the Submit Requests window

–          Anything except Initiated or Manually Approved, if you submit the workflow program from the Invoice Actions window

  1. The invoice amount must equal the distribution total.

 

Approving Invoices at the Line Level

Line-level approval is the approval of one specific line or set of lines within an invoice, rather than approving the entire document. Approvers have access to the Notification Detail and Interactive Line Details pages to review the invoice details. The pages display only the appropriate level of information for the approver to view. That is, approvers view only the information that they can approve or reject. Furthermore, no additional login or privileges are required for the approver to approve. The self-service login that an approver uses to view the notifications is sufficient to review the invoice information.

The system does not initiate document level approval until all lines have been approved. If an approver rejects one line, the remaining line level approvals continue to go through approval. This allows the continuation of the line level approval process while the rejected line is being resolved. However, the system does not continue to document level approvals unless all lines are approved.

 

Tell me about Invoice Approval Workflow

The workflow then sequentially asks each approver in the approval list to approve invoices online. For example, you can define a rule so invoices over $100,000 require CFO approval and then CEO approval.

If you use Invoice Approval Workflow, then every invoice that requires approval must be approved before you can pay it. Payables indicates that an invoice requires approval by setting the value in the Approval status field in the Invoices window to Required.

When you use this feature, all invoices require approval, with the following exceptions. Payables sets the Approval status of the following invoices to Not Required:

*        expense reports imported through the Expense Report Export program (because these expense reports have already been through an approval process)

*        recurring invoices if the recurring invoice template did not have the Approval Workflow Required option enabled (because recurring invoices are often approved in advance)

*        invoices that existed before you enabled the feature

*        invoices that completed the Invoice Approval Workflow process and the Invoice Approval Workflow process determined that according to the rules set up in Oracle Approvals Management that no one needs to approve the invoice

You can submit the Invoice Approval Workflow for an invoice either from the Invoice Actions window, or from the Submit Requests window.

System Setup

Notification from Approvers

Approvers can approve or reject the invoice.

*        If an approver approves the invoice, then the invoice goes to the next person in the approver list until all required people approve the invoice.

*        If an approver rejects the invoice, then the workflow program ends.

*        If an approver does not respond within the time you specify, then Workflow will request approval from that person’s manager.

If an approver rejects an invoice, then you can perform one of the following actions from the Invoice Actions window:

*        Use the Force Approval option to manually approve the invoice

*        Use the Initiate Approval option to resubmit the invoice to the Invoice Approval Workflow after correcting any issue that caused the approver to reject the invoice

*        Use the Cancel Invoice option to cancel the invoice

Suggestion: We recommend that you schedule the Invoice Approval Status Report to run nightly so you can closely monitor your rejected invoices.

You can review the approval status of an invoice that has started the Invoice Approval Workflow in the following ways:

*        Invoice Approval History window

*        Invoice Approval Status Report

Invoice Approval Workflow Program

When you start this program, it updates the approval status of the invoice to Initiated. The invoice is then placed in the WF_DEFERRED queue.

The next time the Workflow Agent Listener runs, the system initiates Invoice Approval Workflow for the invoice.

Prerequisites:

*        Define all your invoice approval rules in Oracle Approvals Management (OAM).

*        Set up, and optionally customize, the Invoice Approval Workflow.

*        Enable the Use Invoice Approval Workflow Payables option.

*        Each invoice meets all selection criteria.

*        In the Submit Requests window your system administrator should schedule the Workflow Agent Listener to run regularly.

Invoice Approval History

(N) Invoices > Inquiry  (M)  Reports > View Invoice Approval History

This window shows you all the approvers for an invoice in the order that the workflow requests approval from them. You can see who has reviewed the invoice, whether the approver approved or rejected it, the response date, what the invoice amount was when the approver reviewed it, and any comments the approver entered. You also see who the pending approver is and who the planned approvers are. If an invoice is force approved, then you see the username of the person who approved the invoice.

Invoice Approval History Window Reference

*        Action Date. Date that the approval action occurred. For example, the date an approver rejected the invoice.

*        Action. The window shows the action associated with each approver.

–          Approved. The invoice was approved by this approver.

–          Rejected. The invoice was rejected by this approver.

–          Pending. The invoice is in this approver’s queue.

–          Future. The invoice is not yet in the approval queue of the approver.

–          Manually Approved. An accounts payable processor manually approved the invoice by using the Force Approval feature.

*        Approver. Name of the approver who is assigned to perform an action in response to a request for approval notification or escalation notification. You set up approvers in Oracle Approvals Management (OAM). If an invoice was force approved, this field shows the username of the accounts payable processor who force approved the invoice.

*        Amount Approved. Invoice total at the time of approval or rejection. This field serves as an audit trail because the invoice amount can change between approvers.

*        Comments. As an invoice goes through the Invoice Approval Workflow process, the approver can enter comments about the approved or rejected invoice. If the invoice is force approved then this field is blank.

 

*                    Tell me about the Reports in AP

*              Batch Control Report by Batch Name

*              Lists invoice batches in order of batch name and batch date. Also sorts by entry name.

*              Batch Control Report by Entered By

*              Lists invoice batches in order of entry person. Also sorts by batch name.

*              Credit Memo Matching Report

*              This report lists credit memos and debit memos that match the supplier and date parameters you specify.  The report also lists the total of the distribution line amounts of each credit memo in your entered currency and your functional currency.

*              Invoice Aging Report

*              Use this report to view your unpaid invoices. This report provides information about invoice payments due within four time periods you specify in the Aging Periods window.  This report does not included cancelled invoices.

*              Invoice Audit Listing by Voucher Number

*              Use this report to review your invoices with assigned sequential voucher numbers. Either you or Payables can assign a unique, sequential number to an invoice during invoice entry, if you enable the Sequential Numbering profile option.

*              Invoice Audit Listing

*              Use the Invoice Audit Listing to audit invoices for duplicates. You should audit invoices periodically to ensure control of invoice payments. You can sort this listing in six different ways. You can also use this report to obtain a listing of your invoices by invoice type.

*              Invoice Audit Report

*              Use the Invoice Audit Report to audit invoices for duplicates. The report lists invoices that appear as potential duplicates according to several criteria. One criterion you specify is the number of characters in the invoice number which two or more invoices have in common. The report lists invoices that meet this criterion and have the same invoice amount, the same invoice date, and the same supplier.  You can limit the search by checking for duplicate invoices within a time period you specify.  Payables sorts the report alphabetically by supplier name, and lists possible duplicates together on consecutive lines.

*              Invoice History Report

*              The Invoice History Report is needed to justify the balance for a given range of invoices. It helps you to quickly identify and review a detailed list of all activities pertaining to a specific invoice including all payments, gain/loss, credit/debit memos, and discounts. The balance of the invoices is then summed for each supplier site, for each supplier, and for the entire report.

*              Invoice on Hold Report

*              Use the Invoice on Hold Report to review detailed information about invoices on hold. You can submit the Invoice Validation process before submitting this report to obtain the most up-to-date hold information.  To obtain additional detail for invoices on matching hold, you can submit the Matching Hold Detail Report.

 

*              Invoice Register

*              Use the Invoice Register to review detailed information about invoices. You can also use this report to view the offsetting liability accounts that Payables creates for each invoice distribution when you validate an invoice.  Payables orders the report by invoice currency and, if you use batch control, the invoice batch name then by supplier name and invoice number.

*              Matching Detail Report

*              Use this report to see the detail of how an invoice, purchase order, or receipt was matched. This report is especially helpful when an invoice is on hold and you are trying determine why the hold was placed.

*              Matching Hold Detail Report

*              Use the Matching Hold Detail Report to review detailed accounts payable and purchasing information for invoices with matching holds and matching hold releases. You can print this report before initiating a payment batch to determine whether to manually release any invoices for payment.

*              Use this report to review recurring invoice templates you defined during a specific time period. You can review this report to determine the amount you have authorized for a recurring invoice template, how much you have released, and the next amount you have scheduled.

*              Matching Hold Agent Notice

*              Use the Matching Hold Agent Notice to print a notice informing a purchasing agent of any matching holds due to a variance between an invoice and the agent’s purchase order. When you submit this report, Payables prints a notice to each purchasing agent who has issued a purchase order that has a variance with its matched invoice.

*              Print Invoice Notice

*              Generate a standard invoice notice to send to a supplier to inform them about one or more invoices you have entered. For credit/debit memos, the notice informs the supplier of outstanding credit or debit memos that you will apply to future invoices.  You can generate this report from either the Invoices window or the Submit Requests window.  You can use Reports to change the boilerplate text.

*              Supplier Paid Invoice History

*              You can submit the Supplier Paid Invoice History Report by supplier or supplier type to review payment history, discounts taken, and frequency of partial payments.

*              Matching Holds by Buyer

*              View matching holds placed on invoices by buyer associated with the purchase order.

*                    Reports

*              Receiving Hold Requestor Notice

*              Use the Receiving Hold Requestor Notice to print a notice informing a requestor of an invoice hold because the requestor has not acknowledged the receipt of invoiced items.

*              Distribution Set Listing

*              Use the Distribution Set Listing to review a complete list of all the Distribution Sets you have defined. Distribution Sets simplify and speed invoice entry by automatically generating invoice distributions for invoices that have assigned Distribution Sets.

 

Pl. Describe the new terms in R12 Payables

Key concepts that are new to Payables in R12 include the following:

Document Payable. A document to be paid by the deploying company (Payer). It may represent, for example, a Payables invoice or scheduled payment.

Pay Run/Payment Process Request. A pay run is a broad term, which describes the process by which a group of invoices is selected and processed for payment. It is roughly equivalent to the Release 11i concept of a payment batch. The term Pay Run is often used interchangeably with the term Payment Process Request. A payment process request is technically a request created by a source product for Oracle Payments payment services. The payment process request, which originates in the source product during the invoice selection process, contains one or more documents payable to be paid. During the payment process, the documents payable in the payment process request are built into payments.

Payee. The person or organization that is being paid. For example, the supplier, employee, or customer to whom the payment is made.

Payment Instruction. A payment instruction is a collection of payments, along with aggregate payment information, that is formatted. Depending on the setup, a payment instruction may be converted into a file to be printed onto checks or into a payment file that is transmitted to a payment system for further processing and disbursement.

Payment Process Profile. A payment process profile is a payment attribute assigned to documents payable, which specifies handling of the documents payable, payments, and payment instructions. Payment process profiles including specifications for payment instruction formatting and transmission.

Payment process profiles contain the following information:

*        payment instruction formatting information

*        transmission information

*        payment grouping

*        payment limits

*        payment sorting details

Payment Process Request Template. A blueprint that simplifies and expedites pay runs by preselecting pertinent payment data, such as general header information, payment selection criteria, payment attributes, processing instructions, and how validation failures are handled.

Payment Format. A set of rules that determine how a payment instruction or settlement batch is converted into a payment file, readable by a payment system. Payment formats are registered and maintained in Oracle XML Publisher.

Payment Method. A payment attribute on a document payable. The payment method indicates the medium by which the deploying company (first party payer) makes a payment to a supplier (third party payee). Examples of payment methods are checks printed in-house by the payer, checks outsourced to the bank for printing, and wires.

Using the Payments Manager

Using the Payments Manager, you can complete a pay run from start to finish. A pay run is the process by which a group of invoices is selected and processed for payment.

Note: A pay run is roughly equivalent to the Release 11i concept of a payment batch.

The Payments Manager enables you to perform the following payment actions:

*        Create payment process request templates by specifying invoice selection criteria.

*        Use templates to automatically select invoices to pay that meet the criteria for payment.

*        Schedule pay runs.

*        Modify invoice selection and payment amounts.

*        Automatically submit invoices for processing and payment by scheduling payment process requests.

*        Initiate payment instructions.

*        View the status of payments.

*        Void or record stop payments.

Seeded Payment Methods

These payment methods are seeded, but deploying companies can create their own payment methods.

Check. A paper check is printed and used as:

*        one payment in a group of multiple payments

*        a Quick payment

*        a Manual payment

Outsourced check. This payment method is used to transmit payment information to an external party, such as your bank, that will print checks on your behalf.

Electronic. You use the Electronic payment method to create instructions for your bank to make payment to a supplier bank account. Typically, this communication is an electronic file that instructs your disbursement bank to pay your suppliers, and is in the specific format that your bank requires. Validations ensure that you have recorded supplier bank account information when you use the Electronic payment method.

Wire. You can use the Wire payment method to manually record payment when you have used a process outside of your Oracle Payables system to instruct your disbursement bank to pay a supplier.

Payables does not require supplier bank account information when you use the Wire payment method. When you define payment documents for these payments, Oracle recommends you use the Recorded disbursement type because you are simply recording a payment made outside of the system. Note: It is recommended that you record the transaction with a Manual payment.

The system allows you to use any disbursement type. For example, some users who regularly record Wire payments for multiple suppliers use payment documents with the Computer Generated disbursement type, create an electronic pay run, and then delete the resulting electronic file.

Bank Account Model

Payables leverages Oracle Trading Community Architecture and Oracle Cash Management to set up the bank accounts that you use to do business (internal bank accounts). Banks and Bank Branches are created as parties in Trading Community Architecture via the user interface in Oracle Cash Management. Bank Accounts are defined in Oracle Cash Management. Each bank can have multiple branches and each branch can have multiple accounts.

When you enable a bank account for use with Payables, you can associate the account with multiple payment documents.

When you set up your suppliers in Oracle iSupplier, you can also set up supplier bank accounts (external bank accounts).

Multiple Currency Payments. If you have enabled the Use Multiple Currencies Payables option and you want to use this bank account to pay invoices entered in multiple currencies, enable this option.

Pooled Account. If you use Automatic Offsets and you want to associate multiple companies with this bank account, then enable this option.  When you enable the Automatic Offsets Payables option, Payables creates one offsetting liability distribution for each invoice distribution.  If you pay an invoice from a pooled bank account, then when Payables accounts for the invoice payment, Payables creates one corresponding cash accounting entry for each liability distribution.

*        In addition, Payables builds the cash account based on the Cash Account defined for the bank account and the account segments of the liability lines.

*        If you do not use a pooled account, then when the payment is accounted, a single accounting entry is created for the Cash account, using the Cash Account that is defined for the bank account without modifying any account segments.

*                    Defining Payment Documents

*              To define payments documents:

*        1.         Query the bank account.

*        2.         Click the Manage Payment Documents button.

*        3.         Click Create.

*        4.         In the Name field, enter a name for the payment documents.

*        5.         In the Paper Stock Type field, select Blank Stock for non-numbered check stock or Prenumbered Stock from the drop-down list.

*        6.         If your check stock has an attached remittance stub, select the Attached Remittance Stub check box.

*        7.         If your check stock has an attached remittance stub, specify the number of lines per remittance stub in the Number of Lines per Remittance Stub field.

*        8.         In the Number of Setup Documents field, specify the number of checks you want to allow for testing check stock setup.

*        9.         In the Format field, select a check format from the list of values.

*        10.       In the Payment Document Category field, select the type of payment document from the list of values.

*        11.       If your check stock is prenumbered, enter the first and last document numbers in the fields under the Document Numbers region.

*        12.       If your organization uses a company checkbook, enter the appropriate information in the Checkbooks region.

Manual Payment Overview

When you create a payment outside of Payables, such as a typed check or wire transfer, you can record the payment within Payables and update the invoice or invoices that you paid.

With a Manual payment, you can override some payment controls of Payables. You can record a single Manual payment for multiple Pay Alone invoices. You can record payment for invoices that are associated with any payment method except Electronic. You can also pay an invoice for a supplier that has the Hold All Payments option enabled.

Prerequisites for processing Manual payments in Payables are:

*        Create the payment outside of Payables.

*        Each invoice you paid must be validated, uncanceled, without holds and must have the same currency as the payment.

Creating Manual Payments

*              When you create a payment outside of Payables by typing a check or performing a wire transfer, you can record the payment within Payables and update the invoices that you paid. You can also use this method to pay invoices with the Clearing payment method.

*              Note: A Manual payment is typically used to record a wire transfer. However, you can also use pay runs and Quick payments.

Recording a Manual Payment

Payables Responsibility

(N) Payments > Entry > Payments

  1. In the Payments window, select Manual in the Type field.
  2. Enter a Trading Partner. The Supplier Number is automatically displayed. If there are multiple Supplier Sites, select the appropriate site from the list.
  3. Enter the Payment Date. The date must be in an open or future period. You can only predate a computer generated payment if the Allow Pre-Date option is enabled in the Single Payment region of the Payment tab within the Payables Options window.
  4. Enter the Bank Account from which you want to make the payment.
  5. Select a Payment Method.
  6. If Printed is selected as the Payment Process Profile, select the type of Payment Document.
  7. Select a Payment Process Profile.
  8. If you enabled the Allow Remit-to Account Override option in the Invoice tab of the Payables Options window, then you can select a different, active Remit-To account. The list of values includes bank accounts assigned to the supplier that have the same payment currency.
  9. If the Bills Payable payment method is selected, enter a Maturity Date.
  10. Select a Rate Type.
  11. If necessary, enter or adjust other information:

*        If you created the payment for an address different from the supplier site and the Allow Address Change option is enabled in the Single Payment region within the Payment tab of the Payables Options window, adjust the address. For example, you may need to send an expense check to a consultant working at a site away from home.

*        If you record voucher numbers either manually or using Sequential Numbering, enter or review voucher information.

*        If the payment currency was different from your functional currency, enter exchange rate information.

  1. Choose Enter/Adjust Invoices to navigate to the Select Invoices window. Select the invoices you paid. The sum of the invoices must equal the payment Amount you entered. Optionally click the Invoice Overview button to see detailed information about an invoice.
  2. Save your work.  Payables records your payment and updates the invoices as paid. If you have selected the wrong invoice, you can select the invoice, and then click the Reverse Payment button. This automatically creates a reversal, which disassociates the invoice from the Manual payment. You can now select the correct Invoice.

Initiating Manual Payments from the Invoice Workbench

In the Invoice Workbench, you can initiate Manual payment of one or more invoices or one or more scheduled payments.  You do this by selecting the invoices you want to pay manually, clicking the Actions button and selecting the Pay in Full option to navigate to the Payments window.  You then select Manual as the Payment Type. Payables automatically enters most of the payment information for you (such as payment amount and supplier/site name), and you skip the invoice selection step you would perform if you were to initiate the Manual payment from the Payment Workbench (Payments window).

Overriding Payment Controls

With a Manual payment, you can override some payment controls. You can:

*        record a single payment for multiple Pay Alone invoices

*        record payment for invoices that are associated with any Payment Method type, except Electronic

*        pay an invoice for a supplier that has the Hold All Payments option enabled

Future Dated Manual Payments

For future dated Manual payments, if the Payables option Use Future Dated Payment Account is set to Supplier Site, then you can select invoices for payment only if the supplier site Future Dated Payment Account is the same as that of the supplier site in the payment header.

Withholding Taxes

If you withhold taxes at payment time, Payables does not automatically withhold taxes if you pay with a Manual payment.

Prerequisites

*        Create the payment outside of Oracle Payables.

*        Each invoice you want to pay must be validated, uncanceled, and without holds.

*        If you use Invoice Approval Workflow, then each invoice that requires approval must be approved before you can pay it.

*        Each invoice must have either the same currency as the payment or use an associated fixed-rate currency.

*        The bank account must have at least one payment document.

*        The payment method is not electronic.

*        For future dated payments, if the Payables option Use Future Dated Payment Account is set to Supplier Site, then you can select invoices for payment only if the supplier site Future Dated Payment Account is the same as that of the supplier site in the payment header

Creating Quick Payments

You can create and print a computer generated payment to pay a supplier for one or more invoices. You can also create a check, save it, then print it later.

When you create a quick payment, you can select an invoice regardless of the payments’ terms and due date. For example, you can create a Quick payment for an invoice that is not yet due.

Prerequisites

*        Invoices must be validated, uncanceled, and without holds.

*        If you are creating an electronic payment, you must assign supplier banks to your supplier.

Creating a Quick Payment

Payables Responsibility

(N) Payments > Entry > Payments

  1. In the Payments window, if you have access to more than one Operating Unit, select the appropriate operating unit, otherwise the default operating unit is automatically entered.
  2. Enter a Trading Partner. The Supplier Number is automatically displayed. If there are multiple Supplier Sites, select the appropriate site from the list.
  3. Enter the Payment document Date. The date must be in an open or future period. You can only predate a computer generated payment if the Allow Pre-Date option is enabled in the Single Payment region of the Payment tab within the Payables Options window.
  4. Enter the Bank Account from which you want to make the payment.
  5. Select a Payment Method.
  6. If Printed is selected as the Payment Process Profile, select the type of Payment Document.
  7. Select a Payment Process Profile.
  8. If you have enabled the Allow Remit-To Account Override option in the Invoice tab of the Payables Options window, then you can select a different, active Remit-To account. The list of values includes bank accounts assigned to the supplier that have the same payment currency.

Important: The system ensures that Quick payments cannot be created for payment to inactive bank accounts.

  1. Enter a Maturity Date if the Bills Payable payment method is selected.
  2. Select a Rate Type.
  3. Click the Enter/Adjust Invoices button to navigate to the Select Invoices window. Select the invoices you want to pay.
  4. Optionally click the Invoice Overview button to review more information about an invoice.
  5. Save your work. If any invoices are subject to withholding tax, a message is displayed. You can choose to proceed, change your selection, or cancel the process. If applicable, any Japanese bank charges are then calculated.

Formatting and optionally printing the Check

*        To format and print, first verify the payment document is in your printer, then select Print Now, optionally change the printer name, and choose OK.

*        To format only and print the check later, select Format and choose OK. When you are ready to print, print from the Submit Requests window. You can use the Print Now option in the Actions window to print only if you print immediately after formatting.

Quick Payment Restrictions

*        NUMBER OF INVOICES. You can only pay as many invoices as you defined for the remittance advice of the payment document.

*        SAME SUPPLIER SITE. You can only select invoices that have the same supplier site as the payment supplier site you enter. You can, however, change the payment mailing address if the Allow Address Change option is enabled in the Single Payment region of the Payment tab of the Payables Options window.

*        PAY ALONE INVOICES. The system adjusts the list of values to ensure that you don’t pay a Pay Alone invoice when you pay multiple invoices. If you have selected an invoice for payment and then select more invoices for payment, then Payables does not include Pay Alone invoices on this list of values. If you select a Pay Alone invoice for Payment, you cannot select more invoices.

*        PAYING IN A FOREIGN CURRENCY. You must pay in the same currency as the invoice. You can enter and pay a foreign currency invoice only if the Use Multiple Currencies option is enabled in the Currency tab of the Payables Options window, and you have defined a multi-currency or foreign currency denominated bank account.

*        CANNOT STOP FORMATTED QUICK PAYMENTS. You cannot stop a Quick Payment before it has been formatted.

Processing Stop Payments for Single Payments in the Payment Workbench

(N) Payments > Entry > Payments > Payments window

After you call your bank to initiate a stop payment on a payment document, you can record the stop payment status. You can void the payment to reverse the accounting and payment records (assuming the bank has confirmed that the payment has not cleared), or you can release the stop payment to reset the payment status to negotiable (assuming the bank has notified you that the payment has cleared or the supplier has contacted you that they located the payment document).

You can review all current stop payments in the Stop Payments Report. You can query all payments with a status of Stop Initiated by selecting that status in the Find Payments window and then selecting the Find button.

Stopping a Payment

*        Contact bank and request stop payment.

*        Find the payment online. In the Payments window, select the payment and choose the Actions button.

*        In the Payment Actions window, select Initiate Stop.

*        Choose the OK button to update the payment status to Stop Initiated.

Releasing a Stop on a Payment

*        Find the payment online. In the Payments window, select the payment and choose the Actions button.

*        In the Payment Actions window, select Release Stop.

*        Choose the OK button to release the stop on the payment and reset the status to Negotiable.

Stop Payment Restrictions

*        PREPAYMENTS. You cannot initiate a stop payment on a payment document that pays a prepayment that you have applied to an invoice. You must first unapply any prepayments, and then you can stop payment.

*        QUICK PAYMENTS. You cannot initiate a stop payment on a Quick Payment that has been formatted.

Voiding Single Payments in the Payment Workbench

(N) Payments > Entry > Payments > Payments window

When you void a payment, Payables automatically reverses the accounting associated with the payment. The status of the paid invoices is also reset to Unpaid or Cancelled depending on the Invoice Action you select when you void the payment.  Payable also reverses any realized gains or losses on foreign currency invoices recorded as paid by the payment.

When you void a payment, you can select the action you want Payables to take on the invoices paid by the void payment. You can choose to:

*        place the invoices on hold

*        cancel the invoices

*        do nothing with the invoices, thereby leaving them available for payment

Note: Since you cannot reverse a void on a void payment, you should have the payment you want to void in your possession or proof that it has not cleared the bank or has been destroyed before you record it as voided. You may also want to review the invoices paid by that payment before you void it, to ensure that you are voiding the correct payment. You can review these invoices in the Invoice Workbench.

Prerequisites

*        Call your bank to initiate a stop payment if the payment has been sent to an employee or supplier.

*        Wait until you get confirmation of the stop payment before you void the payment (optional but recommended).

Voiding a Payment

Find the payment online, and from the Payments window, select the payment and choose the Actions button. In the Payment Actions window, select Void. Review and optionally change the void Date and the GL Date you want Payables to use for the accounting distributions.

*        If you want to change the status of the related invoices to Unpaid, select None for the Invoice Action. The invoices will be available for payment on a new payment.

*        If you want to apply a hold to the related invoices, select Hold for the Invoice Action and select a Hold Name in the Hold window. Payables voids the payment, resets the status of the related invoices to Unpaid, and applies the hold you selected to the related invoices.

*        If you want to cancel all related invoices and reset their Amounts to zero, select Cancel for the Invoice Action. Payables voids the payment and cancels the related invoices.

Voiding and Reissuing Quick Payments

You can:

*        void a Quick payment and automatically reissue payment for the same invoices

*        void the original payment and reissue a new Quick payment

Prerequisites

Enable the Allow Void and Reissue option in the Single Payment region of the Payment tab within the Payables Options window. To void and reissue a Quick payment:

*        Load and properly align your payment document in the printer.

*        Find the Quick payment online, and from the Payments window select the payment and choose the Actions button.

*        In the Payment Actions window, select Reissue. Enter the Payment Date and  confirm the New Check Number. Payables automatically selects Void for you. Review and optionally update the void dates. Payables voids the selected Quick payment and creates a new Quick payment to pay the invoices.

Restrictions

INVOICES PAID BY ANOTHER PAYMENT. When you void a payment, you cannot cancel a related invoice if it was partially paid by a second payment. Instead, when you choose Cancel Invoice, the system applies an ”Invoice Cancel” hold to the invoice for your reference. You can release the hold manually in the Invoice Holds window.

CANCELLING ASSOCIATED INVOICES. If you attempt to cancel an invoice that has been partially paid by another payment by using the Cancel Invoice Action, instead of cancelling the invoice, Payables applies an Invoice Cancel hold to the invoice. This hold is manually releasable.

CLEARED PAYMENTS. You cannot void a payment that the bank has already cleared.

PREPAYMENTS. You cannot void payment on a payment document that pays a prepayment that you have applied to an invoice. You must first unapply any prepayments, and then you can void the payment.

Setting Up Bills Payable

The following setups must be done to use bills payable in Payables.

Funds Disbursement Payment Method Setup

Oracle Payments Payment Administrator responsibility

(N) Oracle Payments Setup > Funds Disbursement Setup > Click Go To Task icon for Payment Methods > Payment Methods page

  1. Click the Create button. The Create Payment Method: General page appears.
  2. In the Bills Payable region, select the Use Payment Method to Issue Bills Payable check box.  When you enable this check box, the payment method is used only for creating bills payable.
  3. In the Maturity Date Override field, specify the number of days to add to the payment date to determine the maturity date.

Note: Payments created with a bills payable payment method will have a maturity date that is based on the earliest available discount or due date when the payment is created. You can optionally override this calculation by entering a value for the number of days in the Maturity Date Override field. The maturity date is then calculated by adding that number of days to the payment date.

Payment Process Profile Setup

Oracle Payments Payment Administrator responsibility

(N) Oracle Payments Setup > Funds Disbursement Setup > Click Go To Task icon for Payment Process Profile > Payment Process Profiles page

To ensure that a payment instruction contains only bills payable:

  1. Click the Create button. The Create Payment Process Profile page appears.
  2. In the Payment Grouping region, select the Bills Payable check box so only bills payable will be grouped into a single payment instruction.

Prepayments Overview

A supplier might send an invoice that references a prepayment. If a supplier reduces the invoice amount by the amount of the prepayment and associated tax, you can use the Prepayment on Invoice feature to enter the invoice.

You can enter two types of prepayments: Temporary and Permanent.

Temporary Prepayments

Temporary prepayments can be applied to invoices or expense reports you receive. For example, you use a Temporary prepayment to pay a hotel a catering deposit. When the hotel’s invoice arrives, apply the prepayment to the invoice to reduce the invoice amount you pay.

Permanent Prepayments

Permanent prepayments cannot be applied to invoices. For example, you use a Permanent prepayment to pay a lease deposit for which you do not expect to be invoiced.

Applying Prepayments to Invoices and Expense Reports

Pay a prepayment just as you would any other invoice. However, you cannot partially pay a prepayment; you must fully pay it. You must fully pay a prepayment before you can apply the prepayment to an invoice.

If you entered the prepayment as a Permanent type and want to apply it, you can query the prepayment in the Invoices window and change the Prepayment Type to Temporary.

If you use Automatic Offsets then your setting for the Prevent Prepayment Application Across Balancing Segments Payables option controls whether you can apply a prepayment to an invoice or expense report with a different balancing segment.

Reconciling Payments with Cash Management

If you enable the Account for Payment When Payment Clears option in the Payables Options window, Accounting Option tab, the following accounting events generate reconciliation accounting entries when you submit the Create Accounting process:

*        the delay in the bank clearing of payments from the time of issuance to the time of reconciliation

*        differences between the original payment amount and the cleared payment amount due to exchange rate fluctuations, bank charges, or bank errors

*        reconciled payments

*        unreconciled payments

Important: You can reconcile foreign currency payments that have no exchange rates. However, Oracle Subledger Accounting will not create reconciliation accounting entries. If you enter the exchange rate in the GL Daily Rates table and then submit the AutoRate program, the reconciliation accounting entries are created for payments that were reconciled without exchange rates.

Reports

Bank Account Listing

Use this report to review information for each internal bank account you use. Payables provides detail information about each bank, bank branch, bank account, and payment document that you have defined.

Cash Requirement Report

Use the Cash Requirement Report to forecast your immediate cash needs for invoice payments. You can submit this report before every pay run to determine your cash requirements for the run. You can also submit this report for the next two or three pay runs to forecast your cash requirements for the future and improve your cash management.

Discounts Available Report

Use the Discounts Available Report to identify payments where you can take advantageous discounts. If you find that you are losing discounts, you can change your system and supplier defaults and modify your pay run selection criteria to make sure that you take all valid discounts.

Discounts Taken and Lost Report

Use the Discounts Taken and Lost report to identify payments for which you could have taken a discount, but did not. If you find that you are losing discounts, you can change your system and supplier defaults and modify your pay run selection criteria to make sure that you take all valid discounts.

Final Payment Register

Use the Final Payment Register to list each payment that was included in a pay run. The report lists each payment in a pay run, including setup, overflow, and subsequently voided payment documents, in ascending order by payment number.

Payment Audit by Voucher Number Report

Use the Payment Audit by Voucher Number Report to review payments with assigned sequential voucher numbers. If you enable the Sequential Numbering profile option, either you or Payables can assign a unique, sequential number to each payment you create. You can also use this report to review assigned and available voucher numbers for the sequence name you specify, as well as sequential numbers that have been deleted.

Payment Exceptions Report

Use this report to review exception payments in Payables. This report provides you with a state-of-the-system listing of the exception payments in Payables at any time. Exception payments are payments that your bank has: Not yet cleared, Cleared for an amount different from the payment amount, Cleared before the payment date, Cleared, but the payment is void in Payables.

Payment Gain & Loss Report

For each payment that has both a gain and a loss, Payables lists each currency exchange rate gain and loss included in the payment.  Use this report if you need to know the exact gain or loss for an invoice in a payment, or how the total gain and loss of the payment is distributed across a payment’s invoices.

Payment Register

Use the Payment Register to review payments created for each bank account you use during a time period you specify. The report lists each payment, as well as the total payment amount and cleared amount of all payments.

Positive Pay File

A positive pay file is a security measure in the form of a document that the deploying company sends to its payment system or bank to inform it of payments made by check. When you print checks, then you can electronically transmit a list of payments to the bank or payment system that indicates the checks you printed, so the bank or payment system knows what checks to pay. This list prevents the payment system or bank from paying fraudulent checks, since such checks are not listed on the positive pay file.

To generate and transmit the positive pay file when checks are printed, select the Automatically Transmit File check box under the Positive Pay Region, Reporting subtab, of the Update Payment Process Profile page.

Payment Process Request Status Report

Use the Payment Process Request Status Report to review the payments Payables will create when you format payments for the invoices in a pay run.

Separate Remittance Advice

Separate remittance advice is a document that lists the invoices paid with a particular payment. You can specify the format for the separate remittance advice document and the delivery method.

To specify when or for which payments remittance advice is generated, select an option from the Condition drop-down list under the Separate Remittance Advice Region, Reporting subtab, of the Update Payment Process Profile page.

*        Number of Documents option: indicates the number of payments that must be included in a payment instruction for the system to generate separate remittance advice for the included payments.

*        The Payment Detail Length option: indicates the minimum payment detail length required to generate separate remittance advice for a payment.

Stop Payments Report

Use the Stop Payments Report to review all current stop payments. Payables does not list any stop payments which were initiated, but then released, or voided at a later time.

Supplier Payment History Report

Use the Supplier Payment History Report to review the payment history for a supplier, or a group of suppliers with the same supplier type.

Unclaimed Property Report

This report identifies uncleared payments and is useful where you need to identify unclaimed property that must be escheated to a designated authority.

Void Payment Register

Use the Void Payment Register to obtain a listing of void payments. The Void Payment Register provides you with payment and supplier information for each void payment.

Payment Terms

Payables Responsibility

(N) Setup > Invoice > Payment Terms

Using Payment Terms

In the Payment Terms window, you can create an unlimited number of payment terms. Payment terms have one or more payment term lines, each of which creates one scheduled payment.  Each payment term line and each corresponding scheduled payment have a due date or a discount date based on one of the following:

*        a specific day of a month, such as the 15th of the month

*        a specific date, such as August 15, 2007

*        the number of days added to your terms date, such as 14 days after the terms date

*        a special calendar that specifies a due date for the period that includes the invoice terms date. Only due dates can be based on a special calendar. Discount dates cannot be based on a special calendar.

Each payment term line also defines the due or discount amount on a scheduled payment. When you define payment terms, you specify payment amounts by percentages or by fixed amounts. After you define payment terms, you can select default payment terms that Payables automatically assigns to the suppliers and supplier sites you enter. The payment terms for a supplier site default to the invoices you enter for the site.

Defining Payment Terms

Name. Enter a unique payment term name and a description. Use names that make it easy to identify the usage of payment terms. For example, use 1/10 Net 30 to refer to a payment term which indicates you receive a 1% discount if you pay within 10 days and the invoice is due in 30 days. This name will appear on a list of values with the description whenever you select a payment term.

Description. Description of payment term.

Cut-off Day. For Day of Month terms only, the day of the month, after which the due and discount dates of the scheduled payment will be in a future month. The exact month depends on the value you enter for the Months Ahead field.  Payables compares the invoice terms date to the Cut-off Day. If you leave this field blank, Payables always uses the current accounting month to determine the due and discount dates.

For example, suppose your Cut-off Day is 11, your Months Ahead is 0 (zero), and your Day Of Month due date is 15. If you enter an invoice with a payment term date of January 12, Payables will set the due date for February 15.

Note: If you use due Days or Fixed Date terms, do not enter a cut-off day.

Rank. If you enable Recalculate Scheduled Payment, enter a unique value to rank your invoice terms.  One is the highest rank.  Payables uses ranks to choose the most favorable payment terms from the invoice and purchase order.  During Invoice Validation, Payables recalculates the scheduled payment using the most favorable terms only if the Recalculate Scheduled Payment Payables option is enabled.

Effective Dates Region [From To]. If you want to make this payment term valid on a certain date, enter that date in the Effective Dates From field. If you want to make this payment term invalid on and after a certain date, enter that date in the Effective Dates To field.

Due Subtab

Enter one of the following to determine the portion of an invoice due on the scheduled payment:

*        % Due – The portion of an invoice due. The total of your scheduled payment lines must equal 100%.  You cannot combine percentages due and amounts due for one set of payment terms.

*        Amount – For amount due terms only, enter the amount due. Typically amount due terms have more than one payment term line since you must specify zero as the amount on your last payment term line.  Payables uses the zero amount payment line to determine the remaining amount due on the last scheduled payment.

Enter one of the following to determine the due date on the scheduled payment line:

*        Calendar – If you enter a value in the Calendar field, Payables determines due dates for scheduled payments by using a special calendar. A special calendar is divided into periods, and each period has a due date assigned to it. When you assign due dates to the periods of a payment terms calendar, you can avoid weekends and holidays. You can define special calendars for payment terms in the Special Calendar window.

*        Fixed Date – Specific month, day, and year on which a payment term is due.

*        Days – Payables adds this number of days to the invoice terms date to determine the due or discount date on your scheduled payment line.  Note: You cannot enter values in the Day of Month and Months Ahead fields for a payment term line if you enter a value in this field.

*        Day of Month/Months Ahead

–          Day of Month – Payables uses the value you enter to calculate a due or discount date for a scheduled payment.  For example, enter 15 to have Payables schedule payment for the 15th day of the month.  Enter 31 if you want Payables to schedule payment for the final day of the month, including months with less than 31 days.

–          Months Ahead – For Day of Month terms only. Payables uses the value you enter in conjunction with the Cut-off Day you enter to calculate the due or discount date of a scheduled payment line. If you enter zero (0) in this field and the terms date of an invoice is the same as or later than the Cut-off Day, then Payables uses the day in the Day of Month field for the next month as the due date of an invoice payment line. If you enter 1 in this field, Payables uses one month beyond the next month as the due date.  Note: You cannot enter a value in this field if you enter a value in the due Days field.

First Discount, Second Discount, and Third Discount Subtabs

If you are using discount terms, define payment term lines in the First, Second, and Third Discount subtabs.  Define discounts so that the first discount has an earlier discount date than the second, and so on. You can realize only one discount on a payment term line.

Enter one of the following to determine the portion of the invoice to discount on the scheduled payment: % Due or Amount.

In the % Discount field, enter the discount percent. Payables uses the percentage you enter to calculate the discount amount available for a scheduled payment. Payables multiply this percentage with the amount due on the scheduled payment line to determine the discount amount available on the scheduled payment line.

Note: In the Second and Third Discount subtabs, you can enter second and third discount percentages for discounts available if you miss the first discount date. Do not enter a value in this field if there is no discount available.

Enter one of the following to determine the due date on the scheduled payment line: Days, Day of Month, or Months Ahead.

 

 

 

Managing Cash Requirements

For various reasons, there may be times when your organization does not have the necessary cash to pay the invoices selected. Several options exist to manage your cash requirements so that they better match the cash you have available.  These options are discussed below.

Run Cash Requirement Report

Use the Cash Requirement Report to forecast your immediate cash needs for invoice payments. You can submit this report:

*        before every pay run to determine your cash requirements for the batch

*        for the next two or three pay runs to forecast your cash requirements for the future and improve cash management

Narrow Selection of Invoices in Pay Run

Although you can review invoices and payments that have been selected for a particular pay run, larger cash flow problems can be more efficiently handled by altering the invoice selection criteria for the pay run. Options include:

*        Additional Pay Through Days – The defaulted date is created by referencing the Additional Pay Through Days setting on the Scheduled Payment Selection Criteria tab in the Create Payment Process Request Template page. This selection criteria is typically set to coincide with the frequency of your pay runs. For example, if you process pay runs twice a month, you would probably specify the Additional Pay Through Days field with a value 15. In times of low cash availability, you can change this value to 7 to pay only those invoices due in the next 7 days rather than the next 15.

*        Payment Priorities High/Low – You may not normally use this criteria during invoice selection. If, however, you have assigned priorities to your suppliers appropriately, you may reduce the number of invoices selected for payment by establishing selection criteria for your higher priority suppliers to prevent delayed delivery of goods or services critical to your operations.

*        Include Only Due – Payables selects invoices with due dates that fall within the Number of Pay From Days and Additional Pay Through Days. These invoices may be ones that are being paid within a discount period or simply when due. You may choose to override the Pay Date Basis on supplier records for a particular pay run by enabling the Include Only Due option. The system then drops invoices from the pay run that were being paid within a discount period, thereby foregoing the discount available.

*        Payment Limits – You can further manage your cash requirements by lowering the maximum dollar amounts set for a total pay run (Maximum Outlay) or for an individual payment within the pay run (Maximum Payment), regardless of the number and dollar amount of the invoices comprising the payment.

Be certain that you’re aware of the impact that these changed selection criteria will have on your organization. In the case of paying only invoices due in the subsequent week, consider when and how you will be able to get back to a regular schedule. Also, review the Discounts Available Report so that you’ll be aware of the cost of foregoing these discounts and paying the full amount on the due date.

Internet Expenses Overview

Oracle Internet Expenses helps employees to enter and submit expense reports using a computer or standard Web browser, Web-enabled mobile device, or Excel spreadsheet.

*        Oracle Internet Expenses integrates with Oracle Payables to provide quick processing of expense reports for payment.

*        Oracle Workflow automatically routes expense reports for approval and enforces reimbursement policies.

 

 

 

Internet Expenses Overview

Advantages of Using Oracle Internet Expenses

Internet Expenses streamlines and automates expense management for a higher return on investment.

*        It reduces administrative costs and data entry errors since data entry is streamlined and accessible anywhere online (mobile, desktop, browser) or offline (spreadsheet).

*        It enforces spend policy to control expenses, showing any policy deviations.

*        It eliminates expensive IT customizations through global accommodation for local statutory regulations and automates audit management, conserving staff for analytical work and providing better information to management.

*        It increases productivity when employees can flexibly create expense reports using a standard Web browser, a connected Web-enabled mobile device, a disconnected spreadsheet, and/or downloaded credit card transactions.

*        It improves cycle times by routing expense reports via workflow.

*        It increases employee satisfaction when their status-related questions can be self-answered within the application.

*                    Expense Reporting Process

*              You create and submit an expense report using Oracle Payables or Oracle Internet Expenses. The basic expense reporting process is as follows:

*        1.   The Employee submits an expense report.

*        2.   The Expenses Workflow notifies the approving authority for online review.

*        3.   If the report is rejected, the Rejection process notifies the employee by email.  You can access and update the rejected expense report from Payables, if you submitted the expense report from Payables, or from Internet Expenses if you submitted the expense report from Internet Expenses.

*        4.   For Payables approvals, the Payables Approval process determines whether a report requires audit. It automatically approves if audit is not needed.  The audit rules determine whether audit is required.  If required receipts are missing or there are questions about policy compliance, auditors can request more information, shortpay, reject or adjust the expense report.  For all cases, notifications are sent to the preparer.

*        5.   After manager and/or accounts payable department approval, the Expense Report Export program converts the expense report into an invoice. In Oracle Payables, the system either creates the payment or it prints the Invoice Export Exceptions Report for expense reports that cannot be imported and have to be resubmitted.

*        6.   The employee is notified and receives payment by check or direct deposit, depending on the company policy or setup.

*                    Entering Expense Reports

*              You can enter expense reports in either Oracle Payables or Oracle Internet Expenses. This module focuses on entering expense reports in Payables only.

*              It is important to note that although the expense report process is similar in these applications, that if you enter expense reports in Payables, you can only view and modify those expense reports in Payables; if you enter expense reports in Internet Expenses, you can only view and modify those expense reports in Internet Expenses.

*              To enter expense reports in the Payables Expense Reports window:

*

*        1.         Either enters the employee name in the Employee field or the employee number in the Number field.

*        2.   Optionally change the GL Account, which defaults from the employee record.

*        3.   In the Send to field, optionally change the location to which you want to send payment for the expense report. You control the default expense address in the Financials Options window.

*        4.   In the Date field, enter the period ending date for the expense report. Payables uses this date as the GL Date for invoice distributions created from the expense report. When you submit Expense Report Export you have the option to override this date.

*        5.   Enter an Invoice Number, or Payables will enter the invoice date or the expense report date as the Invoice Number. Enter a Description of the expense report. This will become the invoice description, and it will appear on reports.

*        6.   Enter the total Amount of the expense report. Payables will confirm that the sum of the item amounts matches this amount.

*        7.   If you enable the Reviewed By Payables check box, this indicates that receipts are not required for this expense report. Consequently, the Receipt Verified check box in the Expense Audit tabbed region becomes non-updatable.

*        8.   Enter the expense report Template you want to use. If a default template is defined in the Payables Options window and the template is active, then Payables displays that default template. The template determines which items you can select. The template also might provide default values for Type, Includes Tax, and GL Account. During Expense Report Export, Payables creates invoice distributions from the lines.

*        9.   For each line on the expense report, select the line and enter the amount. Optionally update the GL Account. The default GL Account for each item line is the GL Account for the employee overlaid with any segments defined on the template for the expense item. As with invoices, taxes are automatically calculated for the Expense report using the Oracle E-Business Tax setup.

*        10.   Save your work.

*              To enter an expense reports in Payables’ Invoices window, ensure that invoice Type = Expense Report.

*              You must use the Invoices window to enter project-related expense reports in the Invoices window. This window captures the necessary project and task related information required for project-related expense reports.

*              Oracle Internet Expenses is a self-service application that helps employees to enter and submit expense reports using a standard Web browser or Excel spreadsheet.

*        Procurement Card Process

*        The flow pictured in the slide above illustrates the procurement card process:

*        1.            Use a SQL*Loader script to load the procurement card transactions into the AP_Expense_Feed_Lines_All

*        2.            Validate the transactions by submitting the Procurement Card Transaction Validation program. This program creates default accounting distributions for procurement card transactions. It also validates imported transactions and identifies exceptions. Exceptions include: Transaction loaded for an employee who is not defined in Oracle Payables; Transaction loaded for a card number that is not defined in Oracle Payables; Duplicate reference numbers of transactions posted by your card issuer (the reference number is the unique number assigned to each transaction by the card issuer).

*        3.            Verify the transactions with the employee by submitting the Procurement Card Transaction Verification program. This program initiates the Employee Verification Workflow program and runs based on the level of notification you define at the card profile level. If verification is required at the profile level, the employee is able to verify transactions directly from the workflow notification (for all or none).  Alternatively, the employee can use Oracle Web Employees to verify transactions individually. With Oracle Web Employees, you can also verify transactions using different statuses, update the default cost center, account for a transaction, and split a transaction. If verification is not required at the profile level, the employee receives a notification that requires no action (unless notification level is set to None).

*        4.            Send the transactions for management approval by submitting the Procurement Card Transactions Approval Process. This program initiates the Manager Approval Workflow program and runs based on the level of notification you define at the card profile level. If approval is required at the profile level, the manager can only approve or reject transactions directly from the workflow notification. If approval is not required, the manager receives a notification that requires no action (unless notification level is set to None).

*        5.            If the transactions need to be adjusted, procurement card administrators can adjust them or create transaction distributions using the Procurement Card Transactions window.

*        6.            Once the transactions are approved, create invoices for the transactions by submitting the Create Procurement Card Issuer Invoice program. This program moves the transaction data from the AP_EXPENSE_FEED_DISTS_ALL table to the AP_INVOICES_INTERFACE and AP_INVOICE_LINES_INTERFACE tables. Then, submit the Payables Open Interface Import program to move invoices into Oracle Payables where they can be validated and paid.

*                    Setting Up Procurement Cards and Credit Cards

*              Use the Card Programs window and the Credit Cards window to set up your credit cards, which are used for employee expense reports, and your procurement cards, which are used by qualified employees to purchase items directly from suppliers. If you are using Internet Expenses, there are additional setup steps. See: Establishing Corporate Credit Cards, Oracle Internet Expenses Implementation and Administration Guide.

*                    Code Sets Window

*              Your card issuer maintains card codes, for example, Standard Industry Classification (SIC) codes or Merchant Category Codes (MCC), to identify suppliers and supplier types for the transactions that your employees incur when using a procurement card.

*              You can assign a default account to a card code so that when you import a transaction for that card code, you can create a default accounting distribution for the transaction based on the card code for the transaction.

*              You define sets of credit card codes in this window. You assign credit card code sets to credit card profiles. You then assign credit card profiles to credit cards.

*

Key Processes

Create Accounting Process

The parameters you use when you submit the Create Accounting program determine how accounting entries are transferred to the ledgers in your general ledger.  Accounting can be created in draft or final mode. You can transfer subledger accounting entries in summary or detail. Regardless of the option you choose, you can always drill down to the subledger to view the details that build the general ledger balances.

Create Accounting – Draft

If you submit the Create Accounting in Draft mode, you can review the subledger accounting entries generated for your Payables transactions. If any accounting is incorrect, you can update the transaction in Payables to correct the accounting before you create final accounting.

Create Accounting – Final

Run the Create Accounting process in Final mode to generate your final subledger accounting entries. Once you generate final accounting, you cannot correct the accounting. Instead, you must enter correcting transactions in Payables.

Integration with Other Applications

Other applications that integrate with Oracle Payables such as Oracle Assets, Oracle Procurement, Oracle Projects, and Oracle Inventory now provide Payables-related accounting information to Oracle Subledger Accounting. Invoice Lines and Distribution details continue to be provided to Payables directly.

Transfer Journal Entries to GL

Submit the Transfer Journal Entries to GL process to transfer accounting information from Oracle Subledger Accounting to the GL Interface. The Transfer Journal Entries to GL process transfers summary or detail accounting activity for any open period into the general ledger interface. When more than one period is open, the transfer selects transactions from the first open period up to the entered transfer date, and passes the correct accounting date and financial information into the general ledger interface.

Journal Import

Once subledger accounting entries are transferred to the GL Interface table, use the Journal Import process to import accounting information from the GL Interface to the general ledger.

Posting Journals

Use the post journals process to update the account balances of your detail and summary accounts. You can post actual, budget, or encumbrance journal batches.

Overview of the Period Close

*        At the end of each accounting period, companies must complete the closing process in Payables and reconcile Payables activity for the period.

*        You close a Payables period after you have completed subledger accounting for transactions for the period and you have transferred the subledger accounting entries to general ledger.

A week before your first period close, create a copy of the production database and then do a dry run following your period close procedures.  The dry run will help you identify problems and issues well in advance of the actual period close.

Prepare for Period Close

Complete all receipt processing

Process all possible receiving transactions so when remaining invoices are matched, Invoice Validation will place fewer matching holds.  Use the Transaction Status Summary window to ensure all receipts were processed and that none have a status of Error.  This form looks like a view only form, however, you can delete records so they may be re-processed.  Receipt Accruals are not generated for errored transactions so make sure you do not skip this step.

Confirm or cancel all pending pay runs

Pay runs must be either confirmed or canceled or you will not be able to close the period.  After all activities relating to pay runs are completed, process any manual payments, and Quick Payments.  Also, process any stop or void payments.

Update matured bills payable

If you use bills payable (future dated payments), either manually update the payment status or use the Update Mature Bills Payable Status program to update the status of any bills payable that have reached their maturity date, but still have a status of Issued.

Import invoices

Process any invoices that are loaded through the Payables Open Interface with the Payables Open Interface Import program.  Review the exceptions report and resolve any invoice related issues.  Typical types of invoices that are imported through this open interface include:

*        EDI inbound invoices (810)

*        Invoices from external systems

*        Invoices created from credit card transactions if using procurement cards

*        Advance Shipment and Billing Notices (ASBNs)

Export and process expense reports

Process any expense reports that are entered using the Payables Expense Reports window as well as invoices coming from external sources.

Interface adjustments to supplier invoices to payables

If you are using Projects, you will most likely be updating project balances with invoices entered in Payables through the accounting period.  Final adjustments to supplier invoices like reclassifying from project to project or task to task, should be interfaced back to Payables using the PRC: Interface Supplier Invoice Adjustment Costs to Payables program. For adjustments to expense reports, use the PRC: Interface Expense Reports from Payables in Oracle Projects program. These programs are submitted in Projects.

Reconcile bank statements

Reconcile any outstanding bank statements.  Depending on how your Payables Options are set up, you may generate clearing events when you reconcile payments.  When you run the Create Accounting process, the accounting will be generated and subsequently sent to the General Ledger during the Transfer Journal Entries to GL process.

Run Validation/Review and Resolve Holds

Run the Invoice Validation Process

The Invoice Validation process attempts to validate invoices and remove any existing holds.  Some invoices may be placed on hold and not validated.  If an invoice contains a system hold manually correct the problem that caused the hold and then rerun the Invoice Validation process to remove the hold.  All user defined holds must be manually removed.

Resolve Invoice Holds

*        Matching Hold Detail Report – Use the Matching Hold Detail Report to review detailed accounts payable and purchasing information for invoices with matching holds and matching hold releases.

*        Invoice on Hold Report – Use the Invoice on Hold Report to review detailed information about invoices on hold. You can submit the Validation process before submitting this report to obtain the most up-to-date hold information.

Rerun the Invoice Validation Process if Necessary

For many system holds it will be necessary to fix the problem that caused the hold.  Rerun the Invoice Validation process after resolving any invoice hold issues to update the status of the invoice to Validated.

Create Subledger Accounting

Create subledger accounting entries for invoice and payment transactions in Payables using Oracle Subledger Accounting.

Before you can account for transactions, the following conditions must be met:

*        Invoices must complete Invoice Validation and must have no holds that prevent accounting. You can define whether a hold prevents accounting in the Invoice Hold and Release Names tab. The system also defines several holds that prevent accounting. You can review these holds in the Invoice Hold and Release Names tab.

*        Payments must have all their invoices accounted first.

There are two ways to create subledger accounting entries for invoice and payment transactions:

*        Create online accounting for a single transaction, invoice batch, or pay run. To do this, select the transaction, and use the Actions button to launch the Create Accounting process.

*        Submit the Create Accounting process from the Submit Requests window. You can schedule this process to run periodically. If you set the process to provide Detailed information, the process lists any transactions that accounted with errors. Review all unaccounted transactions, correct the problems, and resubmit the accounting process.

After you create subledger accounting entries, you can view them in the View Accounting window.

You can update subledger accounting entries in Payables only if you create draft accounting entries. If you review the draft accounting entries and notice that the accounting is incorrect, you can correct the underlying transaction, and recreate the subledger accounting entries. You cannot adjust accounting once you create final accounting entries. Instead, create an adjusting transaction or create a manual journal entry.

Create Accounting Program

The Create Accounting program:

*        Validates and creates subledger journal entries

*        Transfers the final journal entries in the current batch run to General Ledger and starts the General Ledger posting process

*        Generates the Subledger Accounting Program Report, which documents the results of the Create Accounting program

The program has the following parameters:

Ledger. Required; limits accounting events selected for processing to those of a particular ledger.

Process Category. Optional; restricts the events selected for accounting to a particular process category.

End Date. Required; end date for the Create Accounting program; processes only those events with event dates on or before the end date

Mode. Required; determines whether the subledger journal entries are created in Draft or Final mode

Errors Only. Required; limits the creation of accounting to those events for which accounting has previously failed

Report. Required; determines whether to generate a report showing the results of the Subledger Accounting program in summary or detail format

Transfer to General Ledger. Required if Mode is set to Final; determines whether to transfer the subledger journal entries to General Ledger.

Post in General Ledger. Required if Mode is set to Final or Create Accounting is set to No; determines whether to post subledger journal entries in General Ledger.

General Ledger Batch Name. Optional; user-entered batch name that appears on the transferred General Ledger subledger journal entries. Transfer to GL option must be set to Yes.

Include User Transaction Identifiers. Required; controls whether the report displays user identifiers’ names and values.

This program generates the Subledger Accounting Program Report. This report lists the following:

*        Successful events and the subledger journal entries created for those events

*        Errors for failed events

You can run the report in summary or detail mode as follows:

*        Summary mode provides a summary of events processed and detailed information about their errors.

*        Detail mode provides details of subledger journal entries generated from the processing of completed events and a detailed error report.

*                    Transfer and Review

*              Run Transfer Journals to General Ledger

*              The Transfer Journal Entries to GL program is used to transfer accounting entries from Subledger Accounting to General Ledger.

*              The Transfer Journal Entries to GL process automatically generates the Transfer Journal Entries to GL report.  It shows the results of the Transfer Journal Entries to GL process.

*              To obtain a detailed report of accounting entries that were transferred to the general ledger, use the Journal Entries Report with the appropriate date range and GL Transfer Status parameters.

*              Review Transfer Results

*              You can use the Subledger Accounting Program Report, the Transfer to Journal Entries to GL Report, and the Period Close Exception report to review the subledger accounting entries and review any unaccounted transactions.

*              Run Import Journal

*              Run the Import Journal process after submitting Transfer Journal Entries to GL, in order to create unposted journal entries in General Ledger. This process must be submitted from General Ledger.

*              Review Account Analysis Report

*              Run the Account Analysis report in General Ledger to review and analyze accounting entries.  You can use the report parameters to limit the report to just the accounting information you want to review.

Transfer Journal Entries to GL Program

The Transfer Journal Entries to GL program consists of a subset of parameters used in the Create Accounting program as listed below:

*        Ledger

*        Process Category

*        End Date

*        Post in General Ledger

*        General Ledger Batch Name

The Transfer to Journal Entries to GL Report is generated by the Transfer Journal Entries to GL program and lists the following:

*        Transfer to GL Summary

*        General errors

*                    Post Journal Entries in GL

*              Post Journals in GL

*              Once journals are imported into General Ledger, post them.

*              Create Remaining Mass Additions

*              Run the Mass Additions Create program after Payables subledger accounting entries have been transferred to General Ledger (the journals do not need to be posted). Especially if the volume of your asset purchases is high, the Mass Additions Create program will typically be run several times throughout the accounting period so distributions associated with the purchase of assets may be processed.  Subledger accounting entries (based on information in the invoice lines and distributions) are transferred, and they become journal entries in GL.  Keep in mind that it is not mandatory that all invoices for asset purchases be processed during the period in which the asset was purchased.  For example, invoices entered in May for assets purchased in January will be processed in Assets as prior period additions if they were actually placed in service in January.

Reconcile AP to GL

Use the following reports to reconcile your transferred invoices and payments to your Accounts Payable Trial Balance to ensure that your Trial Balance accurately reflects your accounts payable liability:

*        Accounts Payable Trial Balance (for last day of prior period)

*        Payables Posted Invoice Register – Invoice journals must be posted in general ledger to appear on this report.

*        Payables Posted Payment Register – Payment journals must be posted in general ledger to appear on this report.

*        Accounts Payables Trial Balance (for last day of current period)

This balancing process will help you ensure that all liabilities recorded in Payables are reflected in the general ledger AP liability accounts.  If the balance reported by the accounts payables trial balance does not equal the balance in the AP liability account, you can use the Account Analysis report and the General Ledger reports to determine what journals are being posted to that account.  Before running your reports, run the Transfer Journal Entries to GL Program for all transactions in the period that you are reconciling.  Also, be sure to post the transactions in the general ledger.

Close the AP Period

Period Close Exceptions Report

Use the Period Close Exceptions report to review a complete list of exceptions that are preventing the close of a selected accounting period. Submit this report to review a complete list of exceptions that are preventing you from closing a Payables accounting period. This report lists, for each organization within the set of books, the following exceptions:

*        Outstanding Pay Runs

*        Accounting Entries not Transferred to General Ledger

*        Bills Payable Requiring Maturity Event and Accounting

*        Unaccounted Invoices

*        Unaccounted Payments

Correct any exceptions before you close the AP period.

Close the AP Period

Use the Control Payables Periods window to close the AP period.

Close the PO Period

Review the Unnoticed Receipts report

The Uninvoiced Receipts Report should be run before the Receipt Accrual – Period-End process. With this report, you can review all or specific uninvoiced receipts for both period end and online accruals.  Uninvoiced receipts are goods and services you have received that your supplier did not invoice yet. This report indicates exactly what you have to accrue and for what amount, and helps you analyze your receipt accrual entries. The accrual amount is the difference between the quantity received and the quantity billed multiplied by the unit price of the item.

Process period-end receipt accruals

Use the Receipt Accruals – Period-End process to create period-end accruals for your uninvoiced receipts for Expense distributions.  Purchasing creates an accrual journal entry in your general ledger for each uninvoiced receipt you choose using this window. Each time you create accrual entries for a specific uninvoiced receipt, Purchasing marks this receipt as accrued and ignores it the next time you run the Receipt Accrual – Period-End process. Purchasing creates accrual entries only up to the quantity the supplier did not invoice for partially invoiced receipts.

Once the Receipt Accruals – Period-End process completes, use Transfer Journal Entries to GL program from Receiving to transfer the subledger journal entries to General Ledger. The journal is assigned a reversal period based on the category setup. This journal must be reversed in the subsequent period and posted.  If the journal is not reversed and posted, your uninvoiced receipt liability will be overstated.

 

 

Close the purchasing period

Use the Control Purchasing Periods window to control the purchasing periods defined in the Accounting Calendar window.  Purchasing lets you create journal entries only for transactions you enter in an open purchasing period.  Use the Control Purchasing Periods window to change the status of the period to Closed.  Once the Purchasing period is closed, the corresponding Payables period cannot be re-opened unless the purchasing period is re-opened.  Each period in the purchasing calendar will have one of the following statuses:

*        Closed – When you close a purchasing period, Purchasing does not allow further accruals during the period. Purchasing reverses the status of accrued purchase order lines that are set to accrue at period end so that you can accrue them in the next period if you need to.

*        Future – Use this option if you want to open the purchasing period in the future. This option is available only when the current status is Never Opened.

*        Never Opened – Purchasing displays this default status if you have not opened the period in the past.

*        Open – Use this option to open the purchasing period.

*        Permanently Closed – Use this option if you do not want to re-open the period in the future. This option is irreversible.

Process remaining inventory transactions

Process any remaining inventory transactions and close the inventory accounting period.

Run Accrual Reports

Run the accrual reconciliation load program and then use the following reports to analyze the balance of the accrual accounts.
1.  Summary Accrual Reconciliation Report
2.  AP and PO Accrual Reconciliation Report
3.  Miscellaneous Accrual Reconciliation Report
4.  Accrual Write-Off Report
5.  WIP Accrual Write-Offs Report. Note that this report only shows WIP write-offs that were performed in prior releases.

You can also use the following windows to view write-off details:

  1. AP and PO Accrual Write-Off
    2.  Miscellaneous Accrual Write-Off
    3.  View Write-Off Transactions
    Write off accrued transactions as necessary

After you have researched the reported accrual balances, you can use the Accrual Write-Offs window to indicate which entries you wish to remove and write off from this report.

Do not create manual journal entries for write offs since the journal entries will be automatically created against the write off transaction in the costing subledger.

Key Accounts

Receiving Inventory Account

The Receiving Inventory Account is a clearing account.  The account is used for perpetual (on receipt) accruals.  After receiving transactions are processed and the Transfer Transactions to GL process is run, the Receiving Inventory Account is cleared and the Material account is charged with the cost of the capitalized inventory.  Specify this account when you define Receiving Information for your inventory organizations.

 

Inventory AP Accrual

This is the account used by Purchasing to accrue your payable liabilities when you receive items you will capitalize as inventory. This account represents your uninvoiced receipt liability and is usually part of your Accounts Payable Liabilities in the balance sheet. Payables relieves this account when the invoice is matched and validated.  Specify this account when you define Inventory Information for your inventory organizations in the Other Accounts tab.

AP Liability

This defaults from the supplier site and is credited when a standard invoice is entered or debited when a credit memo or debit memo is entered.  The account is relieved when the invoice is paid.

Expense AP Accrual

This is the account used by Purchasing to accrue your payable liabilities when you receive items you will expense.  This account represents your uninvoiced receipt liability when you run the Receipt Accruals – Period End process.  Specify this account on the Accrual tab when you set up Purchasing Options.

Material

An asset account that tracks material cost. For average costing, this account holds your inventory and in transit values. Once you perform transactions, you cannot change this account.  Specify this account when you define Inventory Information for your inventory organizations in the Valuation Accounts region for the Costing Information tab.

Charge Account

This is the charge account is the account that will be charged for the purchase on either the balance sheet or income statement.  If the destination type for the distribution is Inventory, this account will be the Material account associated with the subinventory and you cannot override it.  This is the balance sheet account that will be charged after inventory is capitalized.  If the destination type is expense, you can specify this account (provided it isn’t project related) and override any defaults.  This account will be either an asset clearing account that will be included on the balance sheet or an expense account that will be included on the income statement.  This account is either created or specified when you create a purchase order.

Purchase Price Variance

This account is used to record differences between purchase order line price and standard cost. The Purchase Price Variance is calculated when items delivered to inventory are costed.  This account is not used with the average cost method.  For example, assume the purchase order line price for an item was set at $10 per item but standard cost was set to $12 per item and you purchased 10 items.  The Purchase Price Variance would be $20. Specify the Purchase Price Variance account when you define Inventory Information for your inventory organizations in the Other Accounts tab.

Invoice Price Variance

The variance account used to record differences between purchase order price and invoice price. This account is used by Payables to record the invoice price variance for inventory items.  For expense items, the account generator uses the charge account to record any invoice price variance. For example, assume the purchase order line price for an item was set at $10 per item but you were charged $12 per item and you purchased 10 items.  The Invoice Price Variance would be $20.  Specify this account when you define Inventory Information for your inventory organizations in the Other Accounts tab.

Accrual Accounting – Perpetual Accrual (On Receipt)

Enter purchase order (1)

When you enter a purchase order, accounts are created and stored with the purchase order distribution.  The accounts will eventually be used as a basis for creating accounting that is sent to the general ledger.  Creating a purchase order in and of itself generates no accounting that is sent to the general ledger.

Receive (2)

When you accrue on receipt, processing a receiving transaction automatically sends a receipt accrual to the general ledger.  The Receiving Inventory Account is debited (quantity x purchase order line unit price) and the Inventory AP Accrual account (uninvoiced receipts account) is credited the same amount.  Run the Import Journal process with a source of Purchasing to create unposted journals in the general ledger.

Deliver and cost (3)

After delivering to the final destination, the Receiving Inventory Account is cleared and the Material account is debited.  If you use standard costing, the Material account is debited with the standard cost of the item and any difference is charged to the Purchase Price Variance account.

Period end accrual (4)

When items are accrued on receipt, no period-end accrual is generated by the Receipt Accruals – Period-End process.  The receipt accrual is automatically generated when the receipt is processed.

Invoice and match (5)

Entering an invoice and matching creates a debit to the Inventory AP Accrual account to clear the liability for the uninvoiced receipt (you now have an invoice).  The credit is to the AP Liability account that defaults from the supplier site if the invoice unit price is the same as the purchase order line unit price.  Any difference is charged to the Invoice Price Variance account.  For items with destination type of Inventory, the Invoice Price Variance account will be the Invoice Price Variance account specified when you defined Inventory Information for your inventory organizations in the Other Accounts tab.  The AP Liability account is cleared when the invoice is paid.

Enter purchase order (1)

When you enter a purchase order, accounts are created and stored with the purchase order distribution.  The accounts will eventually be used as a basis for creating accounting that is sent to the general ledger.  Creating a purchase order in and of itself generates no accounting that is sent to the general ledger.

Receive (2)

When you process a receipt, no accounting is created for period end accruals.  Receipts that are accrued at period end will always be for a destination type of expense.

Deliver and cost (3)

When you deliver a receipt to its final destination, no accounting is created.  The expense will be recorded after matching to the purchase order, running the Create Accounting process and subsequently running the Transfer Journal Entries to GL process.

Period end accrual (4)

If an invoice is not entered by period end, the Receipt Accruals – Period End process will generate accruals and transfer the accounting for them to the GL Interface.  Use the Import Journal program to create unposted journals.  This journal is created with a reversal date in a subsequent period.  The journal must be reversed so your receipt liability is not overstated.

Reverse accrual in the general ledger (5)

In the subsequent period, reverse the prior period accrual.

Invoice and match (6)

Entering an invoice and matching creates a debit to the Inventory AP Accrual account to clear the liability for the uninvoiced receipt (you now have an invoice).  The entirecredit is to the AP Liability account that defaults from the supplier site if the invoice unit price is the same as the purchase order line unit price.  Any difference is charged to the Invoice Price Variance account.  For items with destination type of Expense, the Invoice Price Variance account will be the same as the charge account.  The AP Liability account is cleared when a payment is processed.

The Post Mass Additions process places the asset in service.  When the Create Accounting process is run in Assets, the charge account (the clearing account on the invoice distribution) is relieved and the cost account associated with the asset category is charged for the cost of the asset.

Accounting for Payments without Cash in Transit (Cash Clearing)

Enter invoice (1)

standard, unmatched invoice entered into Payables will generate a credit to the AP Liability account and a debit to the charge account specified on the invoice distribution.  For expenses, this will be an income statement account; for assets that will be capitalized in Assets and depreciated, this account will be a balance sheet account (asset clearing account); for inventory received, the account will be the Inventory AP Accrual account.

Pay invoice (2)

When not using cash clearing (cash in transit) account with Cash Management or not using Cash Management, the AP Liability account is cleared when the payment is issued.

Reports

Accounts Payable Trial Balance

Use the Accounts Payable Trial Balance Report to verify that total accounts payable liabilities in Payables equal those in the general ledger. To reconcile these balances you can compare the cumulative total liability provided by this report with the total liability provided by your general ledger.

Accrual Rebuild Reconciliation Report

Use the Accrual Rebuild Reconciliation Report to analyze the balance of the Accounts Payable (A/P) accrual accounts. You can accrue both expense and inventory purchases as you receive them. When this happens, you temporarily record an accounts payable liability to your Expense or Inventory A/P accrual accounts.  When Payables creates the accounting for the matched and validated invoice, Payables clears the A/P accrual accounts and records the liability from the supplier site.  Run this report at period end.

Accrual Write-Off Report

Use the Accrual Write-Off Report to provide supporting detail for your write-off journal entries. The process is as follows. First, you analyze the Accrual Reconciliation Report for transactions that you should expense out of the accrual accounts. After you have researched the reported accrual balances, you then use the Accrual Write-Off window to indicate which entries you wish to remove and write off from this report. And, after you have written off these entries, you use the Accrual Write-Off Report as supporting detail for your manual journal entry.

Matched and Modified Receipts Report

After you automatically create invoice distributions by matching an invoice for goods to a receipt, that receipt can be modified in Purchasing. For example, you might need to adjust a receipt because the quantity received was incorrectly recorded, or the product was defective and returned to the supplier. Use this report to identify receipts that have been changed after invoice matching, and for which no users have seen modifications.

Account Analysis Report

Run the Account Analysis report to review and analyze subledger accounting entries from Payables.  You can use the report parameters to limit the report to just the accounting information you want to review.  The Account Analysis report is helpful when you reconcile your accounts with your general ledger.

Payables Posted Invoice Register

Use the Payables Posted Invoice Register to review accounting lines, summarized by invoice, that have been transferred to the general ledger. Because it presents amounts that have been charged to liability accounts, this report is valid only for an accrual ledger.  The Payables Posted Invoice Register is primarily a reconciliation tool. Use this report along with the Posted Payment Register and the Accounts Payables Trial Balance Report to reconcile balances between Payables and your general ledger.

Payables Posted Payment Register

Use the Posted Payment Register to review accounting lines, summarized by payments that have been transferred to the general ledger.  Because it presents amounts that have been charged to liability accounts, this report is valid only for an accrual ledger. You can submit the Posted Payment Register for one payment journal entry batch or all payment journal entry batches.  The Posted Payment Register is primarily a reconciliation tool. Use this report along with the Payables Posted Invoice Register and the Accounts Payables Trial Balance Report to reconcile balances between Payables and your general ledger.

Receipt Accruals – Period End

Use the Receipt Accruals – Period-End process to create period-end accruals for your uninvoiced receipts for expense distributions.  Purchasing creates an accrual journal entry in your general ledger for each uninvoiced receipt you choose using this window.

Receiving Account Distribution Report

The Receiving Account Distribution Report lists the accounting distributions for your receiving transactions. This report supports the distributions created for the following transactions:

*        Purchase Order Receipts

*        Purchase Order Receipt Adjustments

*        Purchase Order Returns to Supplier

*        Deliver to Expense Destinations

*        Return to Receiving from Expense Destinations

*        Match Unordered Receipts

This report helps you reconcile your receiving accounting to your general ledger.

Unaccounted Transactions Report

Use this report to identify and review all unaccounted invoice and payment transactions and see the reason that Payables cannot account for a transaction.  Run this report after you have run the Create Accounting process.  The report will then show only transactions that had problems that prevented accounting. You can then correct the problems and resubmit the accounting process. Note that this report does not include invoices that have no distributions.

 

 

Uninvoiced Receipts Report

The Uninvoiced Receipts Report should be run before the Receipt Accrual – Period-End process. With this report, you can review all or specific uninvoiced receipts for both period end and online accruals.  Uninvoiced receipts are goods and services you have received that your supplier did not invoice yet. This report indicates exactly what you have to accrue and for what amount, and helps you analyze your receipt accrual entries. The accrual amount is the difference between the quantity received and the quantity billed multiplied by the unit price of the item.

 

Tell me about invoices workbench?

Invoices workbench used for to adjust or pay invoices after search. Also, It’s used for either apply or release holds to invoices and approve or cancel invoices.

To approve invoices online, you must enable Allow Online Approval. You can select one or more invoices online to be approved online in the Invoice Workbench. You can use theApprove Related Invoices option to approve debit/credit memos together with their associated invoices. You can approve the entire invoice if you allow online approval and you enter invoices by batch.

Sometimes, you can make adjustments to invoice distribution, scheduled payments, or invoice details even though the transactions have been paid and posted to the General Ledger. All changes can be made from the Invoice Workbench. You can change the invoice amount and change the distribution amounts and scheduled payments to match the adjusted amount. If you are using PO matching, you can reverse the matching and rematch to correct an error.

To cancel an invoice, use the Invoice Workbench and select the Actions button. The Invoice Actions form will give you several options to choose from. Select Cancel Invoiceand the invoice distributions will be reversed. The invoice amounts and scheduled payments will be set to zero. Once the invoice is cancelled, you cannot make any more changes to it.

From the Invoice Workbench, select the invoice or invoices you wish to pay and choose the Actions button. The Invoice Actions form will display. Select the Pay in Fullcheckbox and then click on the OK button. The Payment Workbench will be invoked and you can create either a quick payment or manual payment. Also, if you do not want to pay in full, you can select scheduled payment(s) to be paid as a quick payment or a manual payment.

After you enter invoice records in the Quick Invoices window, you can submit a customized workflow program to automate your processes for managing invoices. For example, you can customize the workflow program to validate the cost center on all invoices before you import them.

You then submit the Payables Open Interface Import Program to validate the values you entered, provide any default values, and then create invoices with distributions and scheduled payments in the regular Payables tables. After import, Payables provides a report that lists invoice records that were successfully imported and any that could not be imported because they had invalid or missing information. You can query the rejected invoice records in the Quick Invoices window, correct them, and then resubmit them for import. When you import invoice records successfully, Payables creates regular invoices that you can view, modify, and validate in the Invoice Workbench.

Describe the close process in Payables:

  1. Validate all invoices.
  2. Confirm or cancel all incomplete payment batches.
  3. If you use future dated payments, submit the Update Matured Future Dated Payment Status Program. This will update the status of matured future dated payments to Negotiable so you can account for them.
  4. Resolve all unaccounted transactions. Submit the Payables Accounting Process to account for all unaccounted transactions. Review the Unaccounted Transactions Report. Review any unaccounted transactions and correct data as necessary.

Then resubmit the Payables Accounting Process to account for transactions you corrected. Or move any unresolved accounting transaction exceptions to another period (optional).

  1. Transfer invoices and payments to the General Ledger and resolve any problems
  2. In the Control Payables Periods window, close the period in Payables.
  3. Reconcile Payables activity for the period. See: Reconciling Payables Activity,
  • Accounts Payable Trial Balance Report, (this period and last period).
  • Posted Invoice Register,
  • Posted Payment Register,.
  1. If you use Oracle Purchasing, accrue uninvoiced receipts.
  2. If you use Oracle Assets, run the Mass Additions Create Program transfer capital invoice line distributions from Oracle Payables to Oracle Assets.
  3. Post journal entries to the general ledger and reconcile the trial balance to the General Ledger.

Bank Account Model

Payables leverages Oracle Trading Community Architecture and Oracle Cash Management to set up the bank accounts that you use to do business (internal bank accounts). Banks and Bank Branches are created as parties in Trading Community Architecture via the user interface in Oracle Cash Management. Bank Accounts are defined in Oracle Cash Management. Each bank can have multiple branches and each branch can have multiple accounts.

When you enable a bank account for use with Payables, you can associate the account with multiple payment documents.

When you set up your suppliers in Oracle iSupplier, you can also set up supplier bank accounts (external bank accounts).

Entering Bank and Bank Branch Information

Cash Management, Vision Operations (USA) Responsibility

(N) Setup > Banks

 

Entering Banks

You can create a new bank or add bank details to an existing party defined in your Trading Community.

For each bank, define the country in which the bank operates, the name of the bank, the bank address(es), and contacts. Optionally, you can define additional bank information: Alternative Bank Name, Short Bank Name, Bank Number, Description, Taxpayer ID, Tax Registration Number, XML Messages Email, Inactive Date, and Context Value.

Entering Bank Branches

(N) Setup > Banks : (T) Branches

Each Bank can have more than one bank branch. When you create a bank branch, you can create a new branch or add branch details to an existing party defined in your Trading Community.

For each bank branch, define the country in which the bank operates, the bank the branch belongs to, the branch name, the branch type, address(es), and contacts.

In addition to defining the branch type, you can define additional bank branch details: Alternate Branch Name, Routing Transit Number, BIC, Bank Code, EDI Location, EFT Number, Description, RFC Identifier, Inactive Date, and Context Value.

Entering Bank Account Information

Cash Management, Vision Operations (USA) Responsibility

(N) Setup: Banks > Bank Accounts > Create > Create Bank Account page > Create Bank Account: Account Owner and Use page > Create Bank Account: Account Information page

Bank Account Owner. The bank account owner is the legal entity that owns the account.

Account Use. Account use refers to the applications that are going to use this internal bank account: Payables, Payroll, Receivables, and/or Treasury. If the Treasury option is enabled, you must link this bank branch to the counterparty in Treasury.

Information. You enter the name of the account, account number, currency, and description.  You should have the name of the account match the name on the bank’s records and then use the description field to indicate how the account is used, for example, main disbursement account.  The account type is a free-form field that you might use to indicate whether the account is a savings or checking account or whether it’s a corporate or division account.

Optionally, enter or select the Alternate Account Name, Short Account Name, Check Digit, Multiple Currencies Allowed, International Bank Account Number (IBAN), Account Type, Account Suffix, EFT Number, Secondary Account Reference, Account Holder, Alternate Account Holder, Description, Start Date, and End Date.

Entering Bank Account Information

Cash Management, Vision Operations (USA) Responsibility

(N) Setup: Banks > Bank Accounts > Create > Create Bank Account page > Create Bank Account: Account Owner and Use page > Create Bank Account: Account Information page > Create Bank Account: Account Controls page

General Controls Region

Enter the cash account number that should be charged for payments made from this bank account. You can also enter accounts for cash clearing, bank charges, bank errors, foreign exchange charges, and agency location code that will be used when you reconcile with Oracle Cash Management. If you specify these codes in the General Controls region, the accounts you specify will be used as the default accounts for all applications that use this account. You can also specify whether the bank account you are creating is a netting account. Note that you can specify Payables-specific accounts later on.

 

 

 

Payables Controls Region

Multiple Currency Payments. If you have enabled the Use Multiple Currencies Payables option and you want to use this bank account to pay invoices entered in multiple currencies, enable this option.

Pooled Account. If you use Automatic Offsets and you want to associate multiple companies with this bank account, then enable this option.  When you enable the Automatic Offsets Payables option, Payables creates one offsetting liability distribution for each invoice distribution.  If you pay an invoice from a pooled bank account, then when Payables accounts for the invoice payment, Payables creates one corresponding cash accounting entry for each liability distribution.

*        In addition, Payables builds the cash account based on the Cash Account defined for the bank account and the account segments of the liability lines.

*        If you do not use a pooled account, then when the payment is accounted, a single accounting entry is created for the Cash account, using the Cash Account that is defined for the bank account without modifying any account segments.

Minimum/Maximum Payment. Minimum/Maximum payment refers to the smallest and largest payment amounts that you allow in a pay run. When you initiate a pay run using the bank account, Payables uses the bank account’s Maximum Payment as a default.  You can override this default.

Allow Zero Payments. If you allow zero-amount payments from this bank account, enable this option.

Maximum Outlay. Maximum outlay is the largest currency outlay that you allow for a pay run for this bank account.  If the total outlay of a pay run exceeds the maximum outlay for the pay run, Payables displays a warning, but allows you to continue processing the pay run. The Maximum Outlay for a bank account defaults from the Payables Options window.  When you initiate a pay run using the bank account, Payables uses the bank account’s Maximum Outlay as a default.  You can override this default.

Entering Bank Account Information

Cash Management, Vision Operations (USA) Responsibility

Account Use. Select the types of functions that this internal bank account is going to be used for: Payables, Payroll, Receivables, and/or Treasury. Internal banks are the bank accounts for which you are the account holder. Receivables uses internal bank accounts to receive payments from customers. Payables uses internal bank accounts to disburse funds to suppliers.

Organization. Enter or select the Organization that can access the account.

Accounts. For each payables document category and payment method combination you can update the following accounts that default from the bank account:  cash clearing, bank charges, bank errors, realized gain, loss accounts, and future dated payments.

Defining Payment Documents and Payment Methods. You must create at least one payment document before you can use a bank account to create invoice payments. When you define payment documents, you can only select payment methods that use the same currency as the bank account currency. If the bank account is a multiple currency bank account, you can choose foreign currency payment methods or multiple currency payment methods.

Contact

You can enter the prefix, name, title, and telephone for a contact specific to this bank account.

Defining Payment Documents

To define payments documents:

  1. Query the bank account.
  2. Click the Manage Payment Documents button.
  3. Click Create.
  4. In the Name field, enter a name for the payment documents.
  5. In the Paper Stock Type field, select Blank Stock for non-numbered check stock or Prenumbered Stock from the drop-down list.
  6. If your check stock has an attached remittance stub, select the Attached Remittance Stub check box.
  7. If your check stock has an attached remittance stub, specify the number of lines per remittance stub in the Number of Lines per Remittance Stub field.
  8. In the Number of Setup Documents field, specify the number of checks you want to allow for testing check stock setup.
  9. In the Format field, select a check format from the list of values.
  10. In the Payment Document Category field, select the type of payment document from the list of values.
  11. If your check stock is prenumbered, enter the first and last document numbers in the fields under the Document Numbers region.
  12. If your organization uses a company checkbook, enter the appropriate information in the Checkbooks region.

 

Tell me about online approving invoices?

The workflow begins by finding the first approver on the ordered list of approvers. If the invoice requires no approvers to approve it, then the invoice’s approval status is set to Not Required and the workflow program ends.

If the invoice has a first approver, then the workflow program sends an invoice approval request to the approver’s e-mail or Oracle Workflow Notifications Worklist web page (or both). If that approver approves the invoice, the workflow program then looks for the next approver on the ordered list. If there is another approver, the workflow requests approval from that person. The workflow completes when all persons on the ordered list approve the invoice, or if an approver rejects the invoice.

If an approver does not respond within the specified time period, the workflow removes the original notification from the approver’s Notifications Worklist and sends a reminder notification to the approver. If the approver still does not respond, then the workflow removes the reminder notification from that approver’s Notifications Worklist and sends that person’s manager an escalation notification.

Whenever an invoice is approved or rejected, Payables updates the approval record of the invoice, which you can review in the Invoice Approval History window or the Invoice Approval History Status Report. See: Invoice Approval History Window. The invoice approval status is updated when the workflow completes. You can initiate the Invoice Approval Workflow Program in the following ways:

  • Schedule regular submission of the Invoice Approval Workflow concurrent program
  • Initiate the Invoice Approval Workflow Program from the Submit Request window
  • Manually initiate the workflow by selecting one or more invoices in the Invoices window and then from the Invoice Actions window selecting Initiate Approval

 

Tell me about Payment batches?

payment batch set groups several payment batches together so you can simultaneously submit the selection, build, or format process for each payment batch in the set. With a payment batch set you can submit several payment batches with different payment currencies simultaneously.

You define a payment batch set by entering invoice selection criteria for one or more payment batches in the Payment Batch Sets window. Once you define a payment batch set you can use it as a template to regularly manage and submit similar groups of payment batches. You can also set up payment batch sets to automatically submit at regular intervals. For example, you can set up a payment batch set and schedule it to automatically run every Friday.

  • Select/Build: If you want to review and modify the invoices selected in the payment batch before you format payments, choose Select Invoices and Build

Payments to have Payables select invoices and build payments. (Payable automatically builds payments when you initiate invoice selection.)  After the build process is complete, you continue to process the individual payment batches in the Payment Batches window.

  • Format: If you want to format the payments without modifying them, also select Format Payments to have Payables automatically format payments. After formatting is complete, continue to process the individual payment batches in the Payment Batches window. or, if you are creating electronic payments, proceed with Confirming Payment Batches.
  • Confirm: Select Confirm Payment Batch to confirm electronic payments. You cannot select this option if any payment batches in the set use payment documents set up for checks. Confirming is the final step in processing a payment batch. This step is very important because it updates the payment history of invoices paid in a payment batch and associates payment document numbers with the invoices and invoice payments. Also, if you have any unconfirmed payment batches, you cannot close a period or use the same payment document for any other payments until you confirm the payment batch. If all the documents in a payment batch are damaged, you cannot confirm the batch and must cancel the entire payment batch. You will assign one of four status types to each document:
  • Setup. Payable automatically displays the setup checks used to align your printer. Payable automatically voids these checks when you confirm a payment batch. You control the number of setup checks in the Payment Document region of the Bank Accounts window.
  • Printed. Either the checks printed properly or the Electronic payments formatted correctly. Ranges of Printed documents must end on a negotiable document.
  • Skipped. The printer skipped over these checks and nothing printed on them. You can reuse these documents.
  • Spoiled. These documents are ruined and you cannot reuse them. For example, the printer malfunctioned and ruined the documents. Payable automatically voids these documents when you record them as spoiled.

You may have check overflow, a situation where there are more invoices paid by a check than can fit on the remittance stub of one check. If you use the check overflow method Void except Last, Payables voids all checks except the last one for the supplier site. You should record the status of all the checks as Printed.

 

 

How to void payment after print and send a check?

Stopping Payments

After you call your bank to initiate a stop payment on a payment document, you can record the stop payment status in Payables. You can then either void the payment to reverse the accounting and payment records, or you can release the stop payment to reset the invoice status to negotiable. You can review all current stop payments in the Stopped Payments

Voiding Payments

When you void a payment, Payables automatically reverses the accounting and payment records so your general ledger will have the correct information, and so the status of the paid invoices is reset to Unpaid. Payable also reverses any realized gains or losses on foreign currency invoices recorded as paid by the payment.

When you void a payment, you can select the action you want Payables to take on the invoices paid by the void payment. You can choose to place the invoices on hold, cancel the invoices, or do nothing with the invoices, leaving them available for payment. If you enable the Allow Interest Invoices option for a supplier site, Payables automatically reverses all related interest invoices when you void a past-due payment for the supplier site. If you withhold taxes at payment time and you void a payment that paid an invoice with an associated withholding tax invoice, then Payables automatically creates a negative (reversing) invoice for the tax authority supplier to offset the amount of the tax withholding invoice. You

Void Payment Restrictions:

INVOICES PAID BY ANOTHER PAYMENT: When you void a payment, you cannot cancel a related invoice if it was partially paid by a second payment. Instead, when you choose Cancel Invoice, the system applies an “Invoice Cancel” hold to the invoice for your reference. You can release the hold manually in the Invoice Holds tab.

CANCELLING ASSOCIATED INVOICES. If you attempt to cancel an invoice that has been partially paid by another payment by using the Cancel Invoice Action, instead of canceling the invoice, Payables applies an Invoice Cancel hold to the invoice. This hold is manually releasable.

CLEARED PAYMENTS: You cannot void a payment that the bank has already cleared.

PREPAYMENTS: You cannot void payment on a payment document that pays a prepayment that you have applied to an invoice. You must first unapply any prepayments, and then you can void the payment.

 

What is payment / payable document?

Payable or Payment document is a order to pay amounts to supplier like Cheques, Demand Draft, Electronic Payment etc. Use the Payment Documents window to define payment documents for an internal bank account. Examples of payment documents are checks or electronic payments. You must create at least one payment document before you can use a bank account to create invoice payments. You can create an unlimited number of payment documents for an internal bank account.

When you define payment documents, you can only select payment formats that use the same currency as the bank account currency. If the bank account is a multiple currency bank account, you can choose foreign currency payment formats or multiple currency payment formats.

GL Accounts Region of the Bank Accounts Window

You cannot enter GL Account information for Supplier bank accounts.

Cash. Enter the cash account you are associating with a bank account. This account must be an asset account.

When you create a payment, Payables creates accounting entries to credit this cash account. For future dated payments, on the payment’s maturity date, Payables credits the cash account and debits either the future dated payment account or the clearing account (depending on how you account for payments).

If you set up Payables to account for payments at clearing time, then Payables creates accounting entries for your unreconciled invoice payments to credit your cash clearing account, instead of your cash account, using the cash clearing account defined in the next field. After you reconcile your payments using Oracle Cash Management, when you create accounting entries for the reconciled invoice payments, you debit your cash clearing account and credit the cash account you enter here.

If you enable the Automatic Offsets Payables option and enable the Pooled Account option in the Payables Options region of the Bank Accounts window, then when you create a payment, Payables creates a corresponding cash accounting entry for each liability distribution that you pay using this bank account. Payable uses the cash account you define here together with the Automatic Offset Method you choose in the Payables Options window to create the cash accounting entry.

Cash Clearing. If you set up Payables to account for payments at clearing time, enter the cash clearing account you are associating with a bank account. When you create accounting entries for your unreconciled invoice payments, you credit your cash clearing account using this account. After you reconcile your invoice payments using Oracle Cash Management, when you create accounting entries for the cleared payments, you debit this cash clearing account and credit this bank account’s cash account. The account you enter here defaults to the Cash Clearing Account field in the GL Accounts region of the Payment Documents window.

Confirmed Receipts. If you use Automatic Receipts in Receivables and are required to send receipt information to your customer before applying the receipt, the receivable is maintained in the Accounts Receivable account until it is confirmed by the customer. Upon confirmation, it is reversed from the Accounts Receivable account and placed into the Confirmed Receipts account. If you are not required to send receipt information to your customer, the receivable is automatically reversed from Accounts Receivable and placed into Confirmed Receipts.

Future Dated Payment. If you will use this bank account to disburse future dated payments, enter the default value for the future dated payment account. This value will default to payment documents you enter for this bank account. When Payables accounts for future dated payments, it uses the future dated payment account from either the payment document or supplier site, depending on how the Use Future Dated Payment Account Payables option is set.

Multiple Currency Payments. Enable this option if you want to use this bank account to pay invoices entered in multiple currencies. You can select this option only if the Use Multiple Currencies Payables option is enabled and if the bank account is in your functional currency.

Prepayments Overview

A supplier might send an invoice that references a prepayment. If a supplier reduces the invoice amount by the amount of the prepayment and associated tax, you can use the Prepayment on Invoice feature to enter the invoice.

You can enter two types of prepayments: Temporary and Permanent.

Temporary Prepayments

Temporary prepayments can be applied to invoices or expense reports you receive. For example, you use a Temporary prepayment to pay a hotel a catering deposit. When the hotel’s invoice arrives, apply the prepayment to the invoice to reduce the invoice amount you pay.

Permanent Prepayments

Permanent prepayments cannot be applied to invoices. For example, you use a Permanent prepayment to pay a lease deposit for which you do not expect to be invoiced.

 

 

Key Processes

Create Accounting Process

The parameters you use when you submit the Create Accounting program determine how accounting entries are transferred to the ledgers in your general ledger.  Accounting can be created in draft or final mode. You can transfer subledger accounting entries in summary or detail. Regardless of the option you choose, you can always drill down to the subledger to view the details that build the general ledger balances.

Create Accounting – Draft

If you submit the Create Accounting in Draft mode, you can review the subledger accounting entries generated for your Payables transactions. If any accounting is incorrect, you can update the transaction in Payables to correct the accounting before you create final accounting.

Create Accounting – Final

Run the Create Accounting process in Final mode to generate your final subledger accounting entries. Once you generate final accounting, you cannot correct the accounting. Instead, you must enter correcting transactions in Payables.

Integration with Other Applications

Other applications that integrate with Oracle Payables such as Oracle Assets, Oracle Procurement, Oracle Projects, and Oracle Inventory now provide Payables-related accounting information to Oracle Subledger Accounting. Invoice Lines and Distribution details continue to be provided to Payables directly.

Transfer Journal Entries to GL

Submit the Transfer Journal Entries to GL process to transfer accounting information from Oracle Subledger Accounting to the GL Interface. The Transfer Journal Entries to GL process transfers summary or detail accounting activity for any open period into the general ledger interface. When more than one period is open, the transfer selects transactions from the first open period up to the entered transfer date, and passes the correct accounting date and financial information into the general ledger interface.

Journal Import

Once subledger accounting entries are transferred to the GL Interface table, use the Journal Import process to import accounting information from the GL Interface to the general ledger.

Posting Journals

Use the post journals process to update the account balances of your detail and summary accounts. You can post actual, budget, or encumbrance journal batches.

 

 

Setting Up Taxes in E-Business Tax

(N) Setup > Tax > E-Business Tax Home > (L) Tax Configuration

Set up taxes for Payables by defining the basic tax configuration in E-Business Tax.

The basic Tax Configuration is the regime-to-rate flow for each tax regime.

Tax Authority

A government entity that regulates tax law, administers, or audits one or more taxes.

Tax Regime

The set of tax regulations that determine the treatment of one or more taxes administered by a tax authority.

Examples of a tax regime include:

*     A sales and use tax in the United States includes rules for state, county, and city sales and use taxes.

*     An excise tax regime in India includes rules for excise tax and additional excise tax.

*     A VAT tax regime in Argentina includes rules for standard VAT, additional VAT, and perception VAT.

 

Tax

A distinct charge imposed through a fiscal or tax authority.

Examples of a tax include VAT for the United Kingdom and TVA for France.

Tax Jurisdiction

A geographical area where a tax is levied by a specific tax authority or where a specific tax rate applies.

Examples of tax jurisdictions include:

*     The tax jurisdiction for VAT in Germany is the country of Germany.

*     The tax jurisdiction for a San Jose city tax is the City of San Jose, California.

*     The tax jurisdiction for Provincial Goods and Services tax (PST) in Canada is a particular Province, such as Ontario or British Columbia.

Tax Status

The taxable nature of a product or service in the context of a transaction for a tax type.

Examples of a tax status include taxable standard rate, zero rated, exempt, and non-taxable. A tax status is similar to the concept of the tax type definition used within Payables and Receivables in releases prior to Release 12.

Tax Rate

The rate specified for a tax status in effect for a period of time. You can express the tax rate as a percentage or as a value per unit quantity.

An example of a tax rate is 7.5% for a state sales and use tax.

Recovery Rate

The rate of input tax that is allowed to be recovered or offset against output tax.

The recovery rate is applicable to VAT taxes. For example, organizations that only produce VAT applicable goods and services can use 100% recovery rate on most purchases. Organizations that produce VAT exempt goods and services, for example, financial institutions, have a 0% recovery rate.

Operating Unit Tax Accounts

The tax accounts that the system uses to post the tax amounts derived from your transactions. The tax accounts you define serve as default accounting information for taxes, tax rates, tax jurisdictions, and tax recovery rates.

 

How many types of accounting methods in Payable?

When you set up Payables you choose a primary accounting method. In the Payables Options window you can also choose a secondary accounting method. The accounting method determines the types of accounting entries Payables creates. For each accounting method, cash or accrual, you choose a Ledger in which you will account for transactions.

You account only for payments, and do not record liability information for invoices. The payment accounting entries typically debit your expense or asset account and credit your cash or cash clearing account. When you create accounting entries, Payables might also create entries for discount taken and foreign currency exchange gain or loss.

You create accounting entries for invoices and payments. The invoice accounting entries generally debit your expense or asset account and credit your liability account. For prepayments, Payables creates accounting entries that debit your prepayment account and credit your liability account. For prepayment applications, Payables creates accounting entries that debit your liability account and credit your prepayment account.

Payment accounting entries typically debit the liability account and credit the cash or cash clearing account. Payables might also create accounting entries for discount taken and foreign currency exchange gain or loss.

When you reconcile payments using Oracle Cash Management, Payables might also create accounting entries for cash clearing, bank charges, bank errors, and foreign currency exchange gain or loss between payment and reconciliation time. You maintain one Ledger for cash accounting and one Ledger for accrual accounting. You choose which will be your primary and your secondary Ledger. Invoice accounting entries are recorded for your accrual Ledger, and payment accounting entries are recorded in both your cash Ledger and accrual Ledger.

Combined basis accounting allows you to produce financial reports for either your cash or accrual Ledger. For example, you may want to manage your company on an accrual basis, but require cash basis accounting information for certain regulatory reporting on a periodic basis.

 

 How many accounting options in Financials Options in AP?

Liability. Payable assigns this account as the default Liability Account for all new suppliers you enter. You can override this value during supplier entry. If you use Accrual Basis accounting, then the Liability Account for an invoice determines the liability account(s) charged when you create accounting entries for invoices.

Prepayment. The Prepayment account and description for a supplier site’s invoices. The Financials option value defaults to new suppliers, and the supplier value defaults to new supplier sites.

Future Dated Payment. If you use future dated payments, then enter a value for Future Dated Payment account. This value defaults to all new suppliers and new bank accounts. The supplier value defaults to all new supplier sites. The bank account value defaults to new payment documents.

When Payables accounts for future dated payments, it uses the Future Dated Payment Account from either the supplier site or the payment document, depending on the option you select in the Payment Accounting region of the Payables Options window.  If you relieve liability payment time, this should be an asset account. If you relieve liability at future dated payment maturity, then this should be a liability account.

Discount Taken. If you choose to distribute your discounts to the system Discount Taken Account, Payables uses this account to record the discounts you take on payments. Use the Payables Options window to select your method for distributing discounts for your invoices.

PO Rate Variance Gain/Loss. Payable uses these accounts to record the exchange rate variance gains/losses for your inventory items. The variance is calculated between the invoice and either the purchase order or the receipt, depending on how you matched the invoice. These accounts are not used to record variances for your expense items. Any exchange rate variance for your expense items is recorded to the charge account of the purchase order. Payable calculates these amounts during Payables Invoice Validation.

Expenses Clearing. This account is optional when you use the Company Pay payment option of Oracle Internet Expenses. Payable uses this as a temporary account to record credit card transaction activity. Payable debits this account when you create an invoice to pay a credit card issuer for credit card transactions. Payables credits this account with offsets to the original debit entries when you submit Expense Report Import for an employee expense report entered in Internet Expenses that has credit card transactions on it. If you enter an expenses clearing account in this field and in the Expenses Clearing Account field of the Card Programs window, the account entered in the Expenses Clearing Account field of the Card Programs window takes precedence

 

 

 

Foreign Currency Transactions

You can enter all types of invoices, including prepayments, expense  reports, and recurring invoices, in a foreign  currency and then pay them in that currency. When you enter an invoice, Payables uses the exchange rate you select to convert the invoice distributions into functional currency. You define your functional currency during setup for your Ledger. When you create a payment for a foreign currency invoice, Payables uses the exchange rate you enter at that time to convert the payment lines into your functional currency. Any difference in functional currency between invoice entry and invoice payment is recorded as realized Gain/Loss.

When you reconcile your payments using Oracle Cash Management, Payables also creates Gain/Loss accounting entries to record differences between the original payment amount and the cleared payment amount due to exchange rate fluctuations. Transactions must have any necessary exchange rates before you can account for them. Payables creates accounting entries for your invoices and payments in both the functional and foreign currency. To make a foreign currency payment, use a bank account with a  payment document that uses a payment format that is either multi–currency or defined for the foreign currency. The following diagram shows the general steps you follow to enter and pay a foreign currency invoice.

System Setup for Multiple Currency

* In the Currencies window, enable the foreign currencies you want to use.

* Choose your functional currency in the Ledger window.

* Define your Payables options in the Payables Options window.

• Enable the Allow Multiple Currency Payables option. • Enable the Require Exchange Rate Entry Payables option for foreign currency invoice entry. (optional) • Define a default exchange rate type which defaults to all foreign currency invoices. (optional) • Define a default invoice and payment currency which defaults to all supplier sites you enter. (optional) • Select one or both options for Account for Gain/Loss: When Payment is Issued, When Payment Clears. (optional) • Select an option for Calculate Gain/Loss: For Each Invoice or For Total Payment.* Define PO Rate Variance Gain/Loss Accounts when you define Financials Options or during bank setup.* Define Conversion Rate Types. See: Defining Conversion Rate Types (Oracle General Ledger User Guide).q Enter Daily Exchange Rates. See: Entering Daily Rates (Oracle General Ledger User Guide) (optional)* Define foreign currency bank accounts and payment documents.

Defining Foreign Currency Bank Accounts

Prerequisites

* Enable the Use Multiple Currencies Payables option. * Enable the currencies you need in the Currencies window. See:

To define a foreign currency bank account:

  1. Define a basic bank account for receipts or disbursements. • If you are defining a bank account for disbursements, in the Payables Options tabbed region, enter Realized Gain and Realized Loss Accounts. Proceed with Defining and Maintaining Payables Payment  . Choose a payment document that uses a payment format with the same foreign currency as the bank account.
  2. Save your work.

Defining and Maintaining Payables Payment Documents

Use the Payment Documents window to define payment documents for an internal bank account. Examples of payment documents are checks or electronic payments. You must create at least one payment document before you can use a bank account to create invoice

Defining Multiple Currency Bank Accounts

A multiple currency bank account is an account that accepts payments in more than one currency. If you define a multiple currency bank account for payments, the currency of the bank account must be the same as your functional currency.

Prerequisites

* Enable the Use Multiple Currencies Payables option. (Oracle Payables) * Enable the currencies you need in the Currencies window.

To define a multiple currency bank account:

  1. Define a basic bank account for receipts or disbursements.

• If you are defining a bank account for receipts, in the Receivables Options region, enable the Multiple Currency Receipts option. • If you are defining a bank account for disbursements, in the Payables Options region, enable the Multiple Currency Payments option and enter Realized Gain and Realized Loss accounts. Proceed with Defining and Maintaining Payables Payment  . You can define payment documents that use a payment format with any currency.

  1. Save your work.

 

 

Monthly Pay Integration with banks to credit salary

If you use a third party or custom positive pay program to notify your bank of negotiable and non–negotiable checks, you can submit the Positive Pay Report in Payables to create a flat file that contains information for checks you specify. You can then use your positive pay program to format the payment data in the format required by your bank and transmit the data electronically to your bank. You set up your positive pay program to periodically dial up your bank and download a list of exceptions. An exception is a check that is listed on the file you submitted to your bank that is presented to the bank for cashing twice, or is not on the list, or has an amount different from the amount listed.

If you do not approve or reject an exception, the bank will pay the check as presented. Future dated payments are included as negotiable payments even if they have not yet matured.

Setting-Up Your System for Positive Pay _To set up Payables for integration with Positive Pay:

  1. In your positive pay program, specify the path for the output of Payables flat file. The file will be in your ap_out directory.
  2. Optionally prevent certain users from creating positive pay files from the Payment Batches Actions window by hiding the Create Positive Pay check box for their responsibility.
  3. Set your third party or custom positive pay program to automatically dial the bank at regular intervals and download exceptions.
  4. For each bank account you will include on positive pay files, confirm that the Bank Account number and Branch number in the Banks window is correct. The positive pay file must contain accurate bank information. For U.S. based banks, enter the 9–digit ABA transit routing code in the Bank Branch Number field.

Prerequisite

In the Banks window, enter the Branch Number and Bank Account Number for the bank you are using for the payment batch. The positive pay file must contain accurate bank information. For U.S. based banks, enter the 9–digit ABA transit routing code in the Bank Branch Number field.

 

Mass Additions Create Program

Run the Mass Additions Create program to transfer capital invoice line distributions from Oracle Payables to Oracle Assets.

For foreign currency assets, Payables sends the invoice distribution amount in the converted functional currency. The mass addition line appears in Oracle Assets with the functional currency amount. Oracle Assets creates journal entries for the functional currency amount, so you must clear the foreign currency amount in your general ledger manually.

After you create mass additions, you can review them in the Prepare Mass Additions window in Oracle Assets. Prerequisites

* Set up your corporate book in Oracle Assets.* Set up your asset categories in Oracle Assets for the corporate book you want to use with mass additions. * Enter invoices in Oracle Payables Create accounting entries for the invoices. * Transfer accounting entries to general ledger.* Ensure your invoice line distributions meet the necessary criteria to be imported from Payables to Oracle Assets.

To create mass additions for Oracle Assets:

  1. Navigate to the Submit Request window.
  2. Choose Mass Additions Create from the request Name list of values.
  3. In the Parameters window, enter a GL Date and Book.

GL Date: Payables creates mass additions from invoice distribution lines with GL dates that are on or before the date you enter in this field. You must enter a date on or before the current date. Book: Enter the name of the Oracle Assets corporate book for which you want to create mass additions.

  1. Choose Submit to submit the concurrent request Payables automatically runs the Mass Additions Create report so you can review a list of the mass additions created.
  2. Review the log files and report after the request completes.

Automatic Payment Programs

If you use Oracle Payables, use the Automatic Payment Programs window to define payment programs. If you use Oracle Receivables, use this window to define additional receipt and remittance format programs.

Payables users:

Use the Automatic Payment Programs window to define payment programs that you use to format payment documents and separate remittance advice. You specify whether each program is for building payments, formatting payments, or creating a payment remittance advice.

Payable predefines one program for building payments and many standard programs for formatting payments. Payable also predefines a program for creating a separate remittance advice for payments. You can select these predefined programs when you define a payment format, or you can use these programs as templates for creating your own custom payment programs.

 

Receivables users:

Use the Automatic Payment Programs window to define additional receipt format programs you use to create receipt documents such as checks or bills of exchange. You can define as many receipt programs as you want. Payable already provides sample receipt programs that you can use to create and format receipt and remittance documents. If you need a different automatic receipt program, then you should copy the sample program and modify it. You specify whether each program is for the creation, printing, or transmission of automatic receipts or remittances.

Defining Payment Programs for Payables and Defining Receipt and Remittance Programs for Receivables

Payables Prerequisites

* If you are not using Payables predefined payment programs, define a payment program using Oracle Reports.* Register your program in the System Administrator’s Concurrent Programs window. Optionally assign a default printer to the program. If you do not assign a default printer then when you use the payment program, Payables will use the printer you defined as your default as the Printer profile option.

Receivables Prerequisites

* Create a receipt program using Oracle Reports.* Register your program in the System Administrator’s Concurrent Programs window.

To define payment, receipt, or remittance programs:

  1. In the Automatic Payment Programs window, enter a unique Name for the program you are defining. This name will appear on a list of values whenever you need to enter the program name. Enter a program Type. Enter the Registered Name. The concurrent manager uses the Registered Name to refer to the payment program.
  2. Save your work.

Automatic Payment Programs Window Reference Name. The name of the program you are defining. This name will appear on a list of values when you need to enter the name of the program. If you use Receivables, since you use both a format receipts and a transmit receipts program with a single receipt format, you should give both the same name. You can use the same name if the program type is different.

Payables Types:

• Build Payments. A program Payables uses to build payments for the invoices in a payment batch. Payables submits this program during payment batch selection to calculate the payment totals for your payments and determine on which payment documents the payment appears.

Payables provides a predefined Build Payments program called the Standard Build Payments Program. Payables uses this standard build program to group the selected invoices for each payment, order the payments using the order option you specify in the Payment Batches window, create any necessary overflow documents, and determine the total number and amount of payments for a payment batch.

You do not need to define any additional Build Payment programs. Use the Standard Build Payments Program that Payables provides.

• Format Payments. A program Payables uses to format your payment documents. During the Format Payments program, Payables uses your payment format to create the layout of your checks or electronic payments.

• Remittance Advice. A program Payables uses to format a separate remittance advice document. For example, you can use a remittance program to create separate remittance advice documents for your electronic funds transfers.

 

 

Oracle Account payables interview Qs

 

Q/A Details
Question How many types of Invoices we can create in Oracle Payables?
Answer A. Standard
B. Debit Memo
C. Credit Memo
D. Pre-Payment
E. Expense Report
F. Withholding Tax Invoice
G. Miscellaneous Invoice
Question Describe the 4-Way Matching?
Answer 2 – Way Matching: The Invoice Amount Should match with PO, (Invoice with PO)
3 – Way Matching: The Receipts Should match with Invoice, (Invoice, PO with Receipts)
4 – Way Match: The Goods Should match with Inspection/Accepted (Invoice, PO, Inspections & Receipts)
Question How many Holds we have?
Answer System Hold and Manual Hold. Payables lets you apply holds manually on an invoice, Payments etc to prevent the payment from being made or to prevent the accounting entries to be created etc. Some of the Payable holds are — Invoice Hold, Accounts Hold, Funds Hold, Matching Hold, Variance Hold, Misc hold.
Question Can you Release Manual Holds? If Yes, How?
Answer Yes. Holds – Release Holds
Question How many ways you can pay the Invoice Amount?
Answer Apply in Full
Schedule Payments
Installments
Question What is the difference between Debit and Credit Memo?
Answer Debit Memo will raise the Customer
Credit Memo will raise the Vendor
Question Can you create a Duplicate Vendor ?
Answer No
Question Vendor Number Should be Generate Automatic or Manually?
Answer Both, Manual And Automatic
Question How many key flexfields are there in Payables?
Answer No key flexfields in PO,AP
Question What are Payment Terms?
Answer Payables uses payment terms to automatically calculate due dates, discount dates, and discount amounts for each invoice you enter. Payment terms will default from the supplier site. If you need to change the payment terms and the terms you want to use are not on the list of values, you can define additional terms in the Payment Terms window.
Question What are the Payment Methods available?
Answer • Check – You can pay with a manual payment, a Quick payment, or in a payment batch.
• Clearing – Used for recording invoice payments to internal suppliers.
• Electronic – You generate an electronic payment file that you deliver to your bank to create payments. Use Electronic if the invoice will be paid using EFT or EDI.
• Wire – Used to manually record a wire transfer of funds between your bank and your supplier’s bank.
Question What are the line types of an Invoice?
Answer Item: Item lines capture the details of the goods and services billed on your invoice.
Freight: Freight lines capture the details of your freight charges.
Miscellaneous: Miscellaneous lines capture the details of other charges on your invoices such as installation or service.
Tax: Payables integrates with Oracle E-Business Tax to automatically determine and calculate the applicable tax lines for your invoices.
Question What are the Invoice Distribution Types?
Answer Item
Freight
Miscellaneous
Tax
Withholding
Prepayment
Question What are Holds in AP?
Answer Holds can be placed by the system and some holds can be placed manually. Holds prevent payment and, sometimes, accounting of an invoice. Payables applies holds to invoices that fail the Invoice Validation process. Release holds from invoices to allow payment and accounting entry creation for the invoices.
Question What are the Interface Tables in AP?
Answer AP_INVOICES_INTERFACE
AP_INVOICE_LINES_INTERFACE
AP_INTERFACE_CONTROLS
————————————–
AP_SUPPLIERS_INT
AP_SUPPLIER_SITES_INT
AP_SUP_SITE_CONTACT_INT
AP_SUPPLIER_INT_REJECTIONS
Question What is the API to cancel single AP Invoice?
Answer AP_CANCEL_PKG.AP_CANCEL_SINGLE_INVOICE
Question What is the API to find invoice status?
Answer AP_INVOICES_PKG.GET_APPROVAL_STATUS
Question Give some of the Oracle Payables interface?
Answer a) Credit Card Transaction Interface
b) Invoice Import Interface
c) Payables Open Interface
d) Purchase Order Matching
Question What are the key tables where supplier bank information are stored?
Answer IBY_EXTERNAL_PAYEES_ALL
IBY_EXTERNAL_PAYERS_ALL
IBY_EXT_BANK_ACCOUNTS
IBY_PMT_INSTR_USES_ALL
Question What is meant by with-holding tax invoice?
Answer A separate tax invoice generated for withholding tax amount. Later this invoice will be knocked of when making the payment made to the authority.
Question What are all the Modules Interacting with AP?
Answer Cash Management
Oracle iExpenses
General Ledger
Oracle Assets
Subledger Accounting (R12)
HRMS
Project Accounting
Purchasing/iprocurement
Global Accounting Engine (11i)
Question What are the mandatory setups in AP?
Answer 1- Financial Options
2- Define Suppliers
3- Define Payment Terms
4- Define Payment Methods
5- Define Banks and Banks Accounts And Banks Accounts Documents
6- Open AP Accounts Periods
Question What is pay date basis?
Answer The Pay Date Basis for a supplier determines the pay date for a supplier’s invoices.
• Due
• Discount
Question What is the difference between quick payment and manual payment?
Answer Quick Payment: It allows you to make a single payment against one or more invoices at a time to one supplier through payables.
Manual Payment: This is the process of entering the check details which has been paid manually in some emergency requirements into the payment form and selecting the invoices of the concerned supplier and check whether the total of the invoices and the paid amount at the header are same and save.
Question What is terms date basis?
Answer Terms Date Basis is to calculate due date.
Due date is calculated 4way. Eg: payment term is 30days

Due date = Sysdate + 30days
Due date = Invoice date + 30days
Due date = Goods Receive Date + 30days
Due date = Invoice Received date + 30days

Question What are Aging Periods?
Answer Aging periods are nothing but the periods that we setup to control and maintain the supplier outstanding bill towards the invoice. From this we can able to study the due date of the supplier form the generation of invoice.
Question Types of Invoices
Answer 1. Standard Invoices: Standard invoices are the invoices issued by a supplier to the buyer, representing the amount due for the products or services the supplier has provided to the buyer.

Standard invoices can be either matched to a purchase order or not matched.

A standard invoice must be positive amount.

2. Mixed Invoices: Mixed invoices are the invoices which can have either positive or negative amounts and can be matched to both purchase orders and invoices.

For example, if there is a mixed invoice for $-1000, you can either match it to an invoice with $-1000 or to a purchase order with an amount $1000.

3. Credit Memo: Credit memo is an invoice raised by the supplier to the buyer with negative amount. It reduces the supplier balance and reduces the liability.

For example the customer has returned some of the goods that he purchased, the supplier sends a credit memo to the buyer to adjust the balance.

4. Debit Memo: Debit memo is an invoice raised by the customer to supplier with negative amount.

The functionality of Debit Memo is same as Credit Memo. Both are to reduce the liability.

The purpose of Debit Memos is to record a credit for a supplier who does not send you a credit memo.

Unlike in AR, both Credit memo and Debit memo are with negative signs in Payables.

5. Prepayment: Prepayments are the invoices raised to record advance payments to a supplier or employee.
6. Expense Reports: Expense reports are the invoices that represent amount due to an employee for all his business related expenses.
7. Retainage Release Invoices: Retainage release is the act of releasing, or paying, that portion of a payment that was withheld until a substantial portion or all of the service procurement work is completed. The amounts retained during the life of the contract must be released and paid to the supplier or sub-contractor once all or a substantial portion of the work is completed.

Oracle Payables uses the Retainage Release Request to create a type of invoice called Retainage Release. A retainage release invoice has lines, which are copied from the original standard progress invoices, which show an amount left to be released.

Retainage release invoices can only be entered manually in the Invoice Workbench window.

8. Withholding Tax:  After you apply withholding tax to an invoice, you can optionally create invoices to remit withheld tax to the tax authority.

Payables can automatically create withholding tax invoices, or you can perform this
task manually. If you choose to automatically create withholding tax invoices, you must choose whether to do this during Invoice Validation or during payment processing.

9. PO Price Adjustment Invoices:  PO Price Adjustment Invoices are used for recording the difference in price between the original invoice and the new purchase order price.

For example, If a supplier sends an invoice for a change in unit price for an invoice you have matched to a purchase order, PO Price Adjustment Invoices can be used to adjust the invoiced unit price of previously matched purchase order shipments or distributions without adjusting the quantity billed.

PO price adjustment invoices can be matched to both purchase orders and invoices.

10. Quick invoices: Used for quick, high-volume invoice entry for invoices that do not require extensive validation and defaults. After entry, you import these into the Payables system. Validation and defaulting occur during import
Question What is the process/steps for Vendor Conversion?
Answer Insert the Vendor info into the interface tables and perform the required validations:
AP_SUPPLIERS_INT
AP_SUPPLIER_SITES_INT
AP_SUP_SITE_CONTACT_INT
Run the below programs to load the data into the Base tables:
Supplier Open Interface Import
Supplier Sites Open Interface Import
Supplier Site Contacts Open Interface Import
Question Explain the set up used for Automatic or Manual Supplier Numbering.
Answer In the Financials Options window, you can set the Supplier Number entry option to either Autimoatic or Manual • Automatic: The system automatically assigns a unique sequential number to each supplier when you enter a new supplier. • Manual: You enter the supplier number when you enter a supplier
Question What is Contract PO?
Answer Contract PO is created when you agree with your suppliers on specific terms and conditions without indicating the goods and services that you will be purchasing.
Question What is a Payable Document?
Answer A medium you use to instruct your bank to disburse funds from your bank account to the bank account or site location of a supplier.
Question In which table we can find the vendor number?
Answer PO_VENDORS
Question Give the cycle from creating an invoice to transferring it to GL in AP.
Answer )Create Invoice 2)Validate Invoice 3)Create Accounting entries using Payables Accounting Process 4)Submit the Payables Transfer to General Ledger program to send invoice and payment accounting entries to the General Ledger interface. 4)Journal Import (GL) 5)Journal Post (GL)
Question What are the Prepayment types?
Answer Temporary and Permanent
Question What is Aging Periods?
Answer Aging Periods window are the time periods for the Invoice Aging Report. The Invoice Aging Report provides information about invoice payments due during the periods you specify.
Question Whats the difference between the “Payables Open Interface Import” Program and the “Payables Invoice Import” program?
Answer Payables Open Interface — for importing regular invoices Payables Invoice Import — for importing expense reports. In 11i renamed as Expense Report Import. In R12 renamed as Expense Report Export.
Question What is prepayment & steps to apply it to an Invoice?
Answer Prepayment is a type of invoice that you enter to make an advance payment to a supplier or employee.

To Apply it to an Invoice ,in the Invoices window, query either the prepayment or the invoice to which you want to apply it. Choose the Actions button and select the Apply/Unapply Prepayment check box. Click OK.

Question Can you  hold the partial payment if yes then how?
Answer Yes.
1.Go to the Invoice window. Go to the scheduled payments tab.
2.Click “Split” to split the scheduled payment into as many
payments as you wish.
3.Check “Hold” against the Payment line you wish to hold.
Question What program is used to transfer AP transactions to GL?
Answer In 11i “Payables Transfer to General Ledger” Program. In R12 “Transfer Journal Entries to GL” Program.
Question What is use of AP Accounting Periods?
Answer In Payables accounting periods have to be defined to enter and account for transactions in these open periods. Payables does not allow transaction processing in a period that has never been opened. These periods are restricted to Payables only. The period statuses available in Payables are Never Opened, Future,Open, Closed, and Permanently Closed.
Question What are the different interface programs in AP?
Answer Payables Open Interface Import to load Invoices and other transactions.
Supplier Open Interface Import to load Suppliers.
Supplier Sites Open Interface Import to load Supplier sites.
Supplier Site Contacts Open Interface Import to load Supplier Site contacts.
Question What is Invoice Tolerance?
Answer We can define the matching and tax tolerances i.e how much to allow for variances between invoice, purchase order, receipt, and tax information during matching. You can define both percentage–based and amount–based tolerances.
Question What will accrue in Payables?
Answer Expenses and Liabilities
Question Which module is the owner of Vendor/Supplier tables?
Answer PO
Question In AP the suppliers didn’t visible in India Creditors Ledger Report Parameter?
Answer Please check whether that particular supplier is available in Suppliers addition inforamtion or not.
Question 1. Describe the Payment Terms and Discounts?
Answer In the Payment Terms window, you define payment terms that you can assign to an invoice to automatically create scheduled payments when you submit Approval for the invoice. You can define payment terms to create multiple scheduled payment lines and multiple levels of discounts. You can create an unlimited number of payment terms.
Payment terms have one or more payment terms lines, each of which creates one scheduled payment. Each payment terms line and each corresponding scheduled payment has a due date or a discount date based on one of the following:
o a specific day of a month, such as the 15th of the month
o a specific date, for example, March 15, 2002.
o a number of days added to your terms date, such as 14 days after the terms date
o a special calendar that specifies a due date for the period that includes the invoice terms date. Only due dates can be based on a special calendar. Discount dates cannot be based on a special calendar.
Each payment terms line also defines the due or discount amount on a scheduled payment. When you define payment terms you specify payment amounts either by percentages or by fixed amounts.After you define your payment terms, in the Payables Options window you can select default payment terms that Payables automatically assigns to the suppliers and supplier sites you enter. The payment terms for a supplier site default to the invoices you enter for the site.The Payment Terms Which tells us The Installments of a Purchased Goods Are Services. And the Discount is it will depends upon the Discount dates.
Question A Vendor must compulsory have what?
Answer Primary Address
Question Is there any chance to create Vendor only once? If Where should you create?
Answer Yes, Enable the check box in the Vendor Classification Screen
Question Can you cancel an Invoice? How?
Answer Yes, Actions1 – Cancel Invoice
Question How can you match PO with Invoice? What you should not take in the Invoice?
Answer Match/Po Number,Distribution Set should not be taken care at this point. When you enter an invoice and match it to a purchase order, Payables automatically creates distributions for you and checks that your match is within the tolerance you define. After you save the match, Payables updates the quantity billed for each matched shipment and its corresponding distribution(s) by the amount you enter in the Quantity Invoiced field. Payables also updates the amount billed on the purchase order distribution(s).
Question What you should take care When you Match Debit/Credit Memo with an Invoice?
Answer The Invoice Should match with Po. When you enter a credit/debit memo, you can match it to existing invoice(s) to have Payables automatically copy the accounting information and create invoice distributions for the credit/debit memo. You can match the credit memo to multiple invoices, and at different levels of detail. Your available choices depend on whether the originating invoice was matched to a purchase order or not.

For example, if you receive a credit for items you returned to a supplier, you can enter a credit memo and match it to the original invoice you entered to ensure that the credit memo distributes the credit to the same accounts originally charged.

If the original invoice is not purchase order matched (basic invoice), you can:

o Match to an invoice. Payables prorates your credit amount based on the invoice distribution amounts of the original invoice. Payables automatically creates invoice distributions for the credit/debit memo based on the distributions of the original invoice.
o Match to specific invoice distributions. You can allocate the credit amount to specific invoice distributions of the original invoice. Payables automatically creates invoice distributions for the credit/debit memo based on the original invoice distribution that you select. For example, you may order three chairs for three different departments and return one. You can match a credit/debit invoice to the original distribution for that department to ensure that the credit matches the charge.
If the original invoice is purchase order matched, you can:
o Match to specific invoice distributions. You can allocate the credit amount to specific invoice distributions of the original invoice. Payables automatically creates invoice distributions for the credit/debit memo based on the original invoice distributions that you select.
Payables updates the quantity billed for each of the originally matched purchase order shipments and their corresponding distributions by the credit quantity you enter. Payables also updates the amount billed on the purchase order distributions.
o Match to purchase order shipments. Payables prorates, based on the quantity billed, your credit amount across all purchase order distributions associated with the purchase order shipment to which you match the credit/debit memo. Payables automatically creates invoice distributions for the credit/debit memo based on the purchase order distributions associated with the purchase order shipment you match to.
Payables updates the quantity billed for each purchase order shipment and its corresponding distributions by the amount of the credit/debit memo. Payables also updates the amount billed on the originally matched purchase order distributions.
o Record a Price Correction. Use a price correction when a supplier sends an invoice for a change in unit price for an invoice you have matched to a purchase order. You can record a price correction by checking Price Correction when you match a credit/debit memo to a purchase order shipment or purchase order matched invoice distribution. When you record a price correction for a credit/debit memo, you are recording a price decrease from the original invoice.

Payables updates the invoiced unit price of previously matched purchase order shipment or distributions without adjusting the quantity billed so you can track price variances; Payables also updates the amount billed on the originally matched purchase order distributions.

To match a credit /debit memo to an invoice, invoice distribution, or a purchase order shipment:

1. Enter a Credit Memo or Debit Memo type invoice.
Enter a negative invoice amount and all basic invoice information but do not manually enter the distributions.
2. Choose the Match button. In the Find Invoices to Match window, query the invoices you want to match and choose Find. If the credit/debit memo pertains to an invoice matched to a certain purchase order, query by purchase order number to see all invoices matched to that purchase order. Payables navigates to the Match to Invoice window.
Optionally choose the Invoice Overview button to review more information about an invoice.
3. Create invoice distributions by matching to one or more invoices. If you are matching to a non-purchase order matched (basic) invoice, select the invoice and enter a Credit Amount.

If you want to match in further detail, continue the match at the invoice distribution or purchase order shipment level:

o To match to invoice distributions, choose Distribute. For each invoice distribution you want to match to, select the distribution and enter a Credit Amount.
o To match to purchase order shipments, choose Match PO. For each shipment you want to match to, select the shipment and enter either a Quantity Invoiced or Match Amount. Payables automatically calculates the remaining field (Quantity Invoiced x Unit Price = Match Amount). You can optionally change the Unit Price, which defaults from the purchase order.

4. Choose Match to create invoice distributions for the credit/debit memo based on the matches you made.
To review the new invoice distributions, choose the Distributions button from the Invoices Summary.

Question How Will you group a similar type of Items?
Answer Items List
Question How many Payment Types U have?
Answer Quick, Manual, Refund – for refunding an amt – Refund, Manual, Quick, Automatic Payment
Question How will the system calculate the Discount?
Answer Discount date. Invoice payments terms where we have to define the discount rates & dates- 1st discount, 2nd discount & 3rd discount

In the Payment Terms window, you define payment terms that you can assign to an invoice to automatically create scheduled payments when you submit Approval for the invoice. You can define payment terms to create multiple scheduled payment lines and multiple levels of discounts. You can create an unlimited number of payment terms.

Payment terms have one or more payment terms lines, each of which creates one scheduled payment. Each payment terms line and each corresponding scheduled payment has a due date or a discount date based on either a specific day of a month, such as the 15th of the month, or a number of days added to your terms date, such as 14 days after the terms date.

Each payment terms line also defines the due or discount amount on a scheduled payment. When you define Payment Terms you specify payment amounts either by percentages or by fixed amounts. Payables provides a predefined, unalterable payment term, called Prepayment Immediate, which Payables automatically assigns to all prepayments you enter. After you define your payment terms, you can select default system payment terms that Payables automatically assigns to the suppliers and supplier sites you enter. The payment terms for a supplier site default to the invoices you enter for the site.

Attention: If you update the payment terms on an invoice, Payables recalculates the scheduled payment for the invoice. Thus, you must reenter any manual adjustments you made to the previous scheduled payment. For example, if you updated the payment priority on a particular scheduled payment and then changed the payment terms, Payables would recalculate the scheduled payment using the same payment priority defaults as before and you would need to redo your updates.

To define payment terms:

1. In the Payment Terms window, enter a unique Payment Term name and a description which will appear on a list of values whenever you select payment terms.
For detailed information on any field.
If you are entering Day of Month terms, enter a Cutoff Day.
If you enable Automatic Interest, enter a unique value in the Rank field.
If you want to invalidate this payment term after a certain date, enter that date in the Effective Date/To field.
2. Enter each payment terms line.
Enter one of the following to determine the portion of an invoice due on the scheduled payment:
o % Due.
o Amount.
In the Due region, enter one of the following to determine the due date on the scheduled payment line:
o Fixed Date
o Days
o Day of Month, and Months Ahead.
3. If you are using discount terms, define payment terms lines in the First, Second, and Third Discount regions. Define your discounts so that the first discount has an earlier discount date than the second and so on. You can realize only one discount on a payment terms line.
Enter one of the following to determine the portion of the invoice to discount on the scheduled payment:
o % Discount.
o Amount.
In the Discount region, enter the discount percent.
Enter one of the following to determine the due date on the scheduled payment line:
o Due Days
o Day of Month, and Months Ahead.
4. Save your work.

Question What is a Distribution Set?
Answer The Components of the Invoice like COGS, Freight, Tax…
You can use a Distribution Set to automatically enter distributions for an invoice when you are not matching it to a purchase order. For example, you can create for an advertising supplier a Distribution Set that allocates advertising expense on an invoice to four advertising departments. You can assign a default Distribution Set to a supplier site so Payables will use it for every invoice you enter for that supplier site. If you do not assign a default Distribution Set to a supplier site, you can always assign a Distribution Set to an invoice when you enter it.

Use Full Distribution Sets to create distributions with set percentage amounts, or use Skeleton Distribution Sets to create distributions with no set distribution amounts. For example, a Full Distribution Set for a rent invoice assigns 70% of the invoice amount to the Sales facility expense account and 30% to the Administration facility expense account. A Skeleton Distribution Set for the same invoice would create one distribution for the Sales facility expense account and one distribution for the Administration facility expense account, leaving the amounts zero. You could then enter amounts during invoice entry depending on variables such as that month’s headcount for each group.If you enable and use a descriptive flexfield with your distribution set lines, the data in the flexfield will be copied to the invoice distributions created by the Distribution Set.

Note: Taxable distributions created by distribution sets are always inclusive of tax when you use Automatic Tax Calculation even if you have not checked the Includes Tax check box at the supplier site.

Creating Distribution Sets

To create a Full Distribution Set:
1. In the Distribution Sets window, enter the Name and Description of the Distribution Set you are creating.
2. Enter the Account and Description for each distribution and enter the Percentage of the invoice amount that you want to distribute to the Account. You can enter positive and negative percentages. Create as many distributions as you need. The sum of the distribution percentages must equal 100 or 0.
If you are creating a Distribution Set for a federally reportable supplier, optionally enter an Income Tax Type.
Optionally enter an Invoice Tax Code. The Tax Code will default based on the Tax Code Defaults hierarchy you defined in the Payables Options window. If the source Payables uses is Template, then Payables uses the value from the Distribution Set, even if the value is null.
3. Save your work. Payables automatically assigns type Full to your Distribution Set.

To create a Skeleton Distribution Set:
1. In the Distribution Sets window enter the Name and Description of the Distribution Set you are creating.
Attention: If you create a skeleton Distribution Set, include skeleton in the name to remind you to enter the line amounts.
2. Enter the Account and Description for each distribution and leave the Percentage at zero. Create as many distributions as you need.
If you are creating a Distribution Set for a federally reportable supplier, optionally enter an Income Tax Type.
3. Save your work. Payables automatically assigns type Skeleton to your Distribution Set.

Question What is a Prepayment? Describe? How many we have?
Answer Pay a prepayment just as you would any other invoice. However, you cannot partially pay a prepayment; you must fully pay it. You must fully pay a prepayment before you can apply the prepayment to an invoice. You can enter a Prepayment type invoice only in the Invoices window. You cannot enter a Prepayment type invoice in the Invoice Gateway The Advance Amount, Vendor, Employee

Select a Prepayment Type:
o Temporary. You can apply this prepayment to invoices after you approve and pay it.
o Permanent. You cannot apply this prepayment to invoices.

Question How will the Endures knows on a Particular Supplier How many prepayments have Describe?
Answer The Invoice screen after selecting the Vendor Name
Question How will you apply the Prepayment?
Answer Actions1 – Apply / Unapply Prepayment
Question Can you pay unapproved Invoice Amount, if yes How?
Answer No, You have to Approve it then only U can Pay
Question What is Expense Report? and Template?
Answer The Template is the Expense Items on an Employee, the Expense Report gives the Anticipated Expenses of an Employee in Your Organization.Use the Expense Reports window in Payables to enter expense reports for your employees. You can also use this window to review and modify expense reports that you entered in the Expense Reports window, that your organization’s employees entered in Oracle Web Employees, or that you have transferred from Projects. You can apply advances to expense reports to reduce the amount you pay. You can also apply a hold to an expense report to prevent payment. Before you can pay expense reports you must submit the Payables Invoice Import program to have Payables automatically create invoices from the expense reports. You can then create journal entries for posting to your general ledger.

The following are the steps you follow to process an expense report:

1. Enter employees, their locations, and their expense addresses in the Enter Person window.
2. Define the employee as a supplier using either of the following methods:
o Enable the Create Employee As Supplier Payables option to automatically create suppliers from employees when you submit Payables Invoice Import
o Enter the employee as a supplier in the Suppliers window before submitting Payables Invoice Import for expense reports.
3. Define expense report templates that model the different expense report formats you receive.
4. Enter expense reports.
5. Submit Payables Invoice Import to create invoices and invoice distributions for the expense reports. Review the Invoice Import reports, then correct any expense reports that caused exceptions and resubmit Payables Invoice Import.
6. Pay the invoices.

Question What are the 2 important points you should take, when You are raising a Expense Report of Invoice?
Answer One is In the Vendor Screen You have to take Type is “Employee”,
The second one is In the Prepayment Invoice the settlement Date You should take care
Question Can U allow Zero Payments? If yes, How?
Answer Yes, if you enabled the Allow Zero Payments Check box in the Bank Screen the Payments Options
Question Can U pay Debit & Credit Memos Amount?
Answer No
Question Can U Enter Backdated Recurring Invoices? If how?
Answer No
Question What is the Prerequisite for Recurring Invoices?
Answer Special Calendar
Question How many sites exists for payment of invoices to employees?
Answer Home, Office
Question How will you transfer The payable data to GL? What is the Interface Name?
Answer Payables Transfers to GL, It is Feeder System Interface
Question Oracle Payables does not allow entry of invoices if the period status is
Answer CLOSED
Question How to Adjust Average Cost with Invoice Price Variances (IPV)
Answer If you want to get your inventory cost, and ultimately your cost of goods, to reflect the actual cost you paid for your items, then you will want to interface the Invoice Price Variance (IPV) from Oracle Payables to Oracle Inventory/Cost Management. The ability to perform this update of inventory cost is only for inventory organizations using the average cost costing method.  To understand this process, let’s look at the flow of cost from PO receipt to Transfer of Invoice Variances.  Here’s an overview of each step:

1.       Create and approve a PO

2.       Receive the item

3.       Enter and match an AP invoice (release any holds if necessary)

4.       Generate accounting for the AP invoice

5.       Transfer invoice variances to Inventory

Step 2 in the process (PO receipt) sets the initial average cost.  This cost will be used on all issues or shipments out of inventory.  Remember in average costing, we receive at PO price and issue out at average.

Once steps 3 (enter and match an AP invoice) and 4 (generate accounting) are complete, we are ready to run the Transfer Invoice Variance to Inventory program. You can run the program from Cost Management for one inventory organization at a time.  This program will sum the difference between the invoice price and the PO price for each item/organization combination and then create an average cost update transaction.  This transaction will have an amount but not a quantity.  This amount is then applied to the remaining inventory on-hand.  So let’s look at a couple of examples and how your average cost will change.

Example 1:

* PO Price $10
* Receipt Quantity 100
* Invoice Price $12
* On-Hand 100
* Beginning Average Cost $10
* Ending Average Cost $12

In this example, we will apply the IPV of $2 to all 100 units in inventory.  So the average cost before the IPV transfer is $10 and the average cost after the IPV transfer is $12.  This would correctly value our inventory at actual cost.

Example 2:

* PO Price $10
* Receipt Quantity 100
* Invoice Price $12
* On-Hand 10 (sold 90 units)
* Beginning Average Cost $10
* Ending Average Cost $30  (($200/10) + $10 = $30

In this example, we will apply the IPV of $2 to remaining 20 units in inventory.  So the average cost before the IPV transfer is $10 and the average cost after the IPV transfer is $30.  This would result in lower margins the next time we sell and ship this item.

Example 3:

* PO Price $10
* Receipt Quantity 100
* Invoice Price $12
* On-Hand 0 (sold 100 units)
* Beginning Average Cost $10
* Ending Average Cost $10

In this example, we wouldn’t apply the IPV of $2 because the on-hand quantity is zero.  So the average cost before the IPV transfer is $10 and the average cost after the IPV transfer would also be $10.

Question Helpful Tips for a Successful R12 Oracle Payables Implementation
Answer Please read the entire list before starting your R12 implementation or upgrade.

1. Create a realistic schedule for your R12 implementation or upgrade.
2. Conduct your implementation or upgrade on a parallel system.
3. Allow yourself sufficient time to implement and perform user acceptance testing (UAT). This will give you time to assure that your system has been designed and setup to meet your business needs.
4. Assure that as much data as possible is accounted and ALL accounting is transferred.
5. Clear up any data issues in 11i before upgrading (i.e., Run the Accounting Health Check),
6. Use the Maintenance Wizard for the upgrade.
7. If possible, implement the most current version of R12 (i.e., R12.0.4 — see Metalink Note: 465776.1 / Patch 6435000.  In addition, apply the Oracle Financials and Oracle HRMS Release Update Packs 12.0.5 (RUP5) — see Metalink Note: 565898.1 / Patch 6836355
8. Review the Oracle Financials Critical Patches Alert, see Note:557869.1. The alert includes the links to the R12 Known Issues documents, which list the critical patches for Oracle Payables, Subledger Accounting, E-Business Tax, and other Financials applications. Apply the critical patches to prevent encountering issues that have already been addressed.
9. Apply the pre-upgrade patches BEFORE upgrading to R12.
10. Apply the post-upgrade patches ASAP after completing the upgrade.
11. Perform several month-end closes before considering a Go-Live date.

Question How Payables Payment Terms Logic Works ?
Answer How Payment Terms Work And What Is The Functionality Of Payment Terms When ?

The Payment Terms defined works on three basic fields on which you have entered/defined information.
The below combinations along with Invoice date defaults your Invoice Due Date.
In the Define Payment terms screen

Method 1)
———
Invoice Date and No of Days entered in Payment term Days field

a)Days

Say, Invoice date is 28-Nov-2001 then if you enter 60 days then due date will
be 27-Jan-2001. It means it calculates no of days from the Invoice date.

Method 2)
———
Invoice Date + Cut Off day + Day of month with Months ahead.

1) Cut-off Day
2) Day of Month with Months ahead

For example :

If you enter Payment Terms like this:
Cut of day 31 (Last day of a Month) Means even though invoice is 28th 1st what so ever, it calculates from the last day of month.

Day of a month  29
Months ahead    2   ( Two Months)

If invoice is dated 28-Nov-2001, with the above setup you get Due date as 29-Jan-2001 as due date.

It will always calculate from the End of Nov ie 30th Nov and Then it takes Two Months here it gives you always 29th of Second month from Invoice date.

ie

Invoice Date            Due Date

28-Nov-2001             29-Jan-2002
28-Dec-2001             28-Feb-2002
28-Jan-2002             29-Mar-2002

So on and so forth.

Either you give 29th or 30th what so ever, once you give the Day of Month you will get only that day as due date after Months specified in the Months ahead field.

This is how application works and desinged to work.

Please refer documentation for the following terms

Cutoff Day.
Days.
Day of Month
Months Ahead.

Further,
In case, you have  two invoice payment terms which you are not able to define in AP and the due dates are not defaulting as expected;

The two terms are:-

(1) 60 DAYS END OF MONTH go to month end and add 60 days
E.G: invoice dated 28 NOV, due date is 29 JAN

(2) 90  DAYS END OF MONTH go to month end and add 90 days
E.G: invoice dated 28 NOV,  due date is 28 FEB

How would you define these?

The Payment Terms functionality does not support the above example

Question R12 How to get Payment Method Defaulted In Supplier Creation page?
Answer 1. To ensure correct Setup, please perform the following:

a) Go to Setup > Payment > Payment Administrator > Payment Methods

b) Choose Payment Methods and then press Go To Task

c) Query for your Payment Method which you want to be defaulted and then press Go Button

d) Press Update (Not Update Usage Rules)

e) Under (Usage Rules) region you will find (Automatically assign Payment Method to all Payees) Check Box,Click on this Check Box to enable that option and then press Apply Button

2)Also follow the following setup steps in

a (1):

a) Go to Setup> Payment> Payment Administrator > Disbursement System Options and then press Go To Task

b) Under (Enterprise Level) region press View Settings

c) Under (Disbursement System Options: Enterprise-wide) you will find the option (Default Payment Method), press Update Button

d) There are two Options:

> Based Only on Payment Method Defaulting Rules Setup

> Override Defaulting Rules when Default Method Set for Payee

> Please choose the first option (Based Only on Payment Method Defaulting Rules Setup) and then press Apply Button 3) Retest your issue again and feed us back if your issue is resolved.

Question iRececivables Uptake Of Oracle Payment
Answer About the Integration:
Oracle Payments is a new product in release 12. The product known as iPayment will no longer exist in release 12, however all functionality that existed in it is contained within Oracle Payments.

The objective of the new product is to give any deploying company a highly configurable and robust solution to disburse and receive payments. Oracle Payments is a fundamental part of the Oracle Applications architecture, and is provided with multiple products that require support for payment processing services.

Oracle Payments provides the infrastructure needed to connect other products with third party payment systems and financial institutions. The product supports a number of payment features. Some features support just disbursement, some just capture, and other features are common to both.

In iReceivables we can pay for the customers invoices . After selecting the payment method ( Bank Transfer / Credit Card Payment) a receipt would be created in AR . In earlier releases for the capture of funds the iPayments extensions were used .
iReceivables would now call the Oracle Payment API’s for the funds capture. This is entirely in the background and there are no visible changes in the iReceivables user interface because of this integration.

Question What has changed?
Answer    1. The receipt class set up (in AR) has changed requiring the Oracle Payments ‘Payment Method’ to be attached to this kind of payments.
2. Payment attributes of transactions will be stored in a centralized transaction payment-extension entity owned by Oracle Payments.
3. In release 12, Oracle Payments owns the data model where all third party payment instruments are stored (these are instruments like customer credit cards and supplier bank accounts).
Question What happens during the Transaction Entry and Authorization ?
Answer A) During the Transaction Entry
The following are captured in iReceivables during the transaction entry ( paying the Invoice in iReceivables) for the funds capture.

* Payment method
* Payment instrument
* Payment attributes

These values are passed on to Oracle Payments before the Authorization & Settlement API’s are
Called.The transaction authorization information is stored in Payments and linked with the extension entity, this is
no longer stored in AR tables.

B) During Authorization
Oracle Payments mandates that authorization is invoked before a transaction can be settled in Oracle Receivables. Oracle Payments will enforce that the settled amount is equal to or less than the authorized amount.

Based on the payment method passed to the Authorize API, Oracle Payments will perform different functions that depend on the nature of that payment method. For example, for payment methods in the credit card category, Oracle Payments will attempt to validate the credit card and reserve the transaction amounts for settlement. For payment methods in the bank account transfer category, Oracle Payments will not attempt to reserve the funds, but will try to validate the bank account information.

Question What is the set up required ?
Answer In Oracle Payments:
A (funds capture) payment method may be set up or a seeded payment method used. It is required for funds capture within Oracle Payments to set up a funds capture process profile, a payment system, and a payee (the definition of the internal organization that will receive the funds, also known as the first party payee).

Set up Oracle Payments, if you intend to use the Pay Invoice function for credit
cards or for bank account transfers using the ACH network.

In Receivables:
Define Receipt Class and Payment Method

If you are using the Pay Invoice function, define at least one receipt class and payment
method for each iReceivables payment instrument that you intend to use:
• Bank account transfers using Receivables direct debit.
• Credit card payments using Payments.
• ACH bank account transfers using Payments.

In iReceivables:
Go the iReceivable Setup Responcibility > System Parameters  and select the ‘Credit Card Receipt Method’ and
‘Bank Account Payment Method’  defined above . These would default to the receipts created from iReceivables.

Note:
iReceivables does not support cross-currency payments. Though a user can still pay invoices with a credit card
or bank account that has a different currency from that of the invoice, the receipt created in iReceivables
will have the same currency as the invoice.

Question How to disable Create Online Accounting in Payables
Answer (1) Log on to System Administrator Responsibility
(2) Navigate Applications->Menu
(3) Query up Menu “AP_APXINWKB_MENU”
(4) In the child records of AP_APXINWKB_MENU, you should see “Invoice Accounting”
(5) Uncheck the grant checkbox for “Invoice Accounting”.
(6) Log on to Payables Responsibility
(7) Create a invoice and approve it.
(8) Click on the Actions button.
(9) You should see “Online Accounting” checkbox disabled.
Question Difference between Match and Quick Match
Answer PO Default :

Enter PO Default as the invoice type if you know th purchase order you want to match to, but you do not know to which purchase order shipments or distributions you want to match. When you enter a PO Default invoice in the Invoice Workbench, Payables prompts you to enter the purchase order number and automatically enters the supplier name, supplier number, supplier site, and the purchase order currency for the invoice currency. When you choose the Match button,Payables will retrieve all purchase order shipments associated with the specified purchase order. You can then match to any shipment or distribution.

Quick Match:

Enter Quick Match as the invoice type if you want to match an invoice to all shipments on a purchase order. When you enter a Quick Match invoice in the Invoice Workbench, Payables prompts you to enter the purchase order number and automatically enters the supplier name, supplier number,supplier site, and the purchase order currency for the invoice currency. When you choose the Match button, Payables automatically matches to each shipment. You can choose to complete the match or override the matching information.

Question Bank Account Access Options And Bank Account Grant Access Organizations
Answer When we define Bank account we assign: Bank Account: Account Owner and Use

1. Bank Account Owner and Use:
1). Bank Account Owner: The name of the source account holder.
2). Account Use: Select the checkboxes that apply to your account: Payables, Payroll,
Receivables, Treasury.

Question Bank accounts can be given Organization Access to other organizations under any Legal Entities as long as those Legal Entities are owned by the same Ledger of the Legal Entity that owns the bank account? What it means?
Answer Yes..The LE and OU’s are indirectly tied with the ledger.. The ledger of the operating unit must be same as the primarly ledger of the Legal entity. Additionally, the user should have access to the operating units.
Question why an Organization is not listed in the LOV of the Bank Account Grant Access Organizations window? Is it because the LE owning the bank account has its Ledger and that ledger do not have other OU since those are not linked to this ledger?
Answer Yes, that is one reason.. another reason could be that user might not have access to that OU.
Question Explain the concept of the ERS. Also give relevant set-ups and programs related to it.
Answer Evaluated Receipt Settlement (ERS) also referred to as ‘Pay on Receipt’. While defining supplier site in Purchasing tab, the “Pay on” field should be ‘Receipt’.
Question Can an invoice be accounted if there are holds applicable to the invoice?
Answer Yes! An invoice can be accounted even if the holds are applied against it provided, Accounting Allowed check-box is enabled while defining the Invoice Hold.
Question Can the same Invoice Number be entered for two different suppliers in Payables?
Answer The invoice number should be unique for a given supplier; hence, the same Invoice Number can be used by multiple suppliers
Question Control of Payables (AP) periods is at what level? At Operating Unit?
Answer Though Payables (AP) operates at Operating Unit level, the control of period is at set of books level.
Question Can the same bank account be assigned to multiple suppliers? What is the alternative if same bank account is to be shared across multiple suppliers (e.g. part of same group)?
Answer Yes, While defining Internal bank accounts, “Allow Assignment to Multiple Suppliers” check-box should be enabled.
Question What is “Zero Payment”? And what are the set-ups required to make a Zero Payment? Is it possible to ensure that only zero payments are allowed using a payable document?
Answer While defining Bank Accounts, in Payable Options tab “Allow Zero Payments” check-box to be enabled. To ensure that only zero payments are allowed using a payable document, attach a payment format to the same which has “Zero Amount Payments Only” check-box enabled.
Question A supplier is available in Invoice Inquiry; however, the supplier is not available while entering Invoices. What are the possible reasons for the same?
Answer he possible for the unavailability of supplier are
– The ‘Pay’ check-box at supplier site (General tab) is disabled
– ‘Inactive On’ date is entered at the supplier site level i.e. supplier site is end-dated.
Question While doing future dated payments, is the future dated payment account at the supplier site used?
Answer It depends on the Payable Options’s Accounting tab. There we have option to select whether the future dated payments account should be selected either from Supplier site or Payable documents.
Question When the ‘Payment Method’ at invoice level is given as ‘Electronic’, sytem requires some additional details? What are they?
Answer When the ‘Payment Method’ is selected as ‘Electronic’ system additionally requires a Bank account in the invoice currency to be assigned to the supplier.
Question If there is a requirement that for specific supplier, each invoice should be paid by a separate check? Can that be achieved? If yes, how?
Answer While defining supplier site in the Payments tab, the “Pay Alone” need to be checked so that each invoice is paid by a separate check.
Question Let us assume that a check issued to supplier has become time-barred. And supplier returns it requesting for a new check. Can the existing check be voided and a new check be issued simultaneously?
Answer
Question Can the payment date be before the system date i.e, is it possible to issue back-dated checks?
Answer Yes
Question While defining payable documents, document number is given as 1 to 4999. And an user has issued checks till 4999. What happens when 5000th check is being created using the same payable document?
Answer Error:
The provided payment document is exhausted. Select a different payment document or select skipped document number, if any.
Question Can you create an Invoice in USD, while the Standard PO has been created in EUR?
Answer
Question What are the various possible period statuses in AP?
Answer Various period statuses of AP module are
– Never Opened
– Open
– Closed
Question Period Close Exception Report’ lists some payments under the heading ‘Future Dated Payments Requiring Maturity Event and Account’. What action should be taken to resolve this?
Answer To resolve this issue ‘Update Matured Future Payment Status’ program needs to be submitted with appropriate Maturity Date.
Question Can a period be closed if the Payment Batch in that period is in the status ‘Formatted’?
Answer Yes, If a period can be closed only after the payment is accounted and transferred to GL. Since, the status of payment is not ‘Confirmed’; this payment will not allow for AP period closure.
Question Will an Invoice without a Distribution Line come in the ‘Period Close Exception Report’? What action will be required to resolve it
Answer An Invoice without a distribution will not hinder period closing process. Hence, no action will be required.
However, it is recommended to enter distributions, if a valid invoice; else delete such invoices.
Question What are the most common issues encountered while AP Period Closing process?
Answer Without going to technicalility, on a broader level the most common issues are:
– Invoice (Distributions) not Validated
– Invoices on Hold
– Invoices not Accounted
– Payments not Accounted
– Invoices & Payments accounting entries not transferred to GL
– Maturity Accounting not done for Future Dated payments

The above issues may arise either because users forgot to run relevant programs or because of bugs (which are quite many in AP) and awaiting resolution from Oracle (after Service Request i.e SR is raised).

Question Is is mandatory to resolve the issues in All the Operating Units of a given Legal Entity? Or  the period can be closed once issues of one Operating Unit are resolved?
Answer It is mandatory to resolve all the issues of ALL the Operating of a given Legal Entity/ Set of Books (SOB).
Question Explain the Interface process.
Answer The interface process starts with uploading the legacy data, which is in the form of flat file to the temporary table, and validating the data in the temporary. After that the data to be transferred to the Interface tables. From there by running the Customer Open Interface concurrent program, the data that is in the interface tables are transferred to main tables.
Question What are the various tables involved in AP Interface?
Answer AP_INVOICES_INTERFACE
AP_INVOICE_LINES_INTERFACE
Question What is the program used to import invoices from interface tables?
Answer Payables Open Interface Import
Question Invoices vs Invoice Batches
Answer
Question Number of Tabs in Invoice Entry screen and what are they?
Answer General, Lines, Holds, Veiw Payaments, Scheduled Payments, Veiw Prepayment Applicatons
Question Where is the method of Supplier Number set? At what level is the supplier numbering controlled?
Answer
Question What are the various statuses of invoices?
Answer
Question How many key flexfileds are there in Payables
Answer Payables doesn’t have any key flexfield
Question What are AP Accounting periods? How are they different from GL periods? Are there adjusting periods in AP?
Answer
Question Can a partial payment of Prepayment be done?
Answer No
Error: The Prepayment amount cannot be different from the total invoice amount which are selected for payment
Question Can you hold partial payments? And how can that be achieved?
Answer
Question How can the Invoice distributions’ which can be transferred to Fixed Assets be identified in AP? Is there is any field explains/indicates the same?
Answer Track as Assets
Question When you return goods to supplier (RTS) whether system created Debit Memo or Credit Memo? And what is the set-up required for the system to create the relevant document automatically?
Answer Debit Mome
Question What does Accrual mean?
Answer
Question An invoice is entered, validated and accounted. And thereafter, the invoice is cancelled; what will be the accounting status?
Answer
Question How can we link an Employee to Supplier?
Answer
Question Can you explain the concept of Automatic Offset in Payables? And how is this different from Autoaccounting in AR?
Answer
Question Can two users use same payable document simultaneously? If yes, which user will get the document number assigned first?
Answer
Question What are the various statuses of payment batch?
Answer
Question Can the payment date be before invoice date?
Answer
Question Can accounting of Payment be done before accounting invoice?
Answer No
Question Explain the concept of Proxima payment terms.
Answer
Question What are the various type of Distribution sets? And what is thier purpose?
Answer
Question Can an Invoice in INR be paid in USD currency? What are the alternatives available?
Answer
Question Can multiple currency payments be done using same bank account? If yes, what are the relevant set-ups required?
Answer
Question Can PO level DFF be transferred to AP Invoice? Any set-ups are required for the same?
Answer
Question What is the name of program which is used to transfer accounting entries from AP to GL and what are the options available during submitting the program?
Answer
Question Explain the concept of withholding tax along with relevant set-ups.
Answer
Question What’s the difference between the “Payables Open Interface Import”
Program and the “Payables Invoice Import” program?
Answer
Question What are the tables associated with Invoice?
Answer ap_invoices_all
ap_distributions_all
ap_holds_all
ap_interface_rejections
Question What is Interest Invoice and how it can be created?
Answer
Question Explain the set up used for Automatic or Manual Supplier Numbering.
Answer
Question What is Accounting periods?
Answer Accounting periods are the periods in which you perform your operations.Accounting periods are closed so as to ensure that no accounting entries can be passed in that period after they are clsoed.Suppose you have issued your results without closing your accounting periods and then you chnage some entries in that period thus in turn misleading the public at large.So it is important to close your accounting periods.Also, if accounting periods in Ap are not closed it shall not allow you to run GL.Prior to closng the periods it is important to ensure that all your invoices are validated and no hold exists on any one of them.If hold exists it shall not allow you to run GL.
Question Types of Invoice in Payables?
Answer 1. Standard invoice
2. Debit memo
3. Credit memo
4. Prepayment
5. Expenses Report
6.PO defualt
7. Quick match
8. Mixed invoice
9. Withholding Tax
10. Interest invoice
11. Recurring invoice
Question Use of recurring invoice?
Answer
Question When does the Invoice price variance arise? What is the accounting entry?
Answer Purchasing and Inventory provide you with visibility and control of your invoice price and exchange rate variances. Payables automatically calculates and records invoice price and exchange rate variances in your general ledger when you have matched, approved and posted your invoices. You can use the Invoice Price Variance Report to review the accuracy of your purchase order prices.

IPV= difference between invoice price and po price.

These IPV, PPV only for inventory and wip transactions.

Question What is the difference between Standard Remittance and Factoring Remittance?
Answer
Question How to refund for a customer who returns goods and wants a refund for $600 in R12 In above scenarios customer does not want Credit Memo or On- Account Credit, he wants refund check . and as we know we do not issue check from AR. How can we issue Check from AP and how offsetting is done for the same in R12
Answer
Question What is Allow Zero Invoice. Give a example?
Answer
Question What various types of matching. Explain them?
Answer
Question Match/Hold: How do I remove a Final Matching hold so that I can pay the invoice?
Answer This hold is in effect because the invoice was matched to a PO line that has a status of Final Closed. There is no way to manually remove the hold; the system must remove the hold. There are two workarounds for this situation:

Workaround #1: You need to reverse the distribution line that has the final match hold. You can then create a new PO line, and match to that line.

Workaround #2: You can manually create a distribution line on the invoice that is not matched to the PO, but is charged to the correct GL account. For More information on Final Match Holds see Note 1026090.6.

Question How do I create a Withholding Tax invoice?
Answer After you apply withholding tax to an invoice, you can optionally create invoices to remit withheld tax to the tax authority.

Payables can automatically create withholding tax invoices, or you can perform this task manually. If you chose to automatically create withholding tax invoices, you must choose whether to do this during Approval or during payment processing. Indicate this choice in the Withholding Tax region of the Payables Options window. See: Withholding Tax Payables Options.

If you choose to create withholding tax invoice manually, create an invoice for each Withholding Tax type invoice distribution on an invoice. Create the invoice for the tax authority supplier and site assigned to the Withholding Tax type tax name and for the amount of the Withholding Tax type invoice distribution.

Question What is Purchase Price Variance?
Answer Purchasing and Inventory provide you with visibility and control of your purchase price variances. When you use standard costing, Purchasing and Inventory automatically calculate and record purchase price variances as you receive your inventory items into inventory. If desired, Purchasing and Inventory automatically calculate and record purchase price variances for your outside processing receipts into work in process. You can use the Purchase Price Variance Report to review the accuracy of the standard costs for your purchased items and services.

PPV= standard cost – actual cost ie:difference between standard cost and po price.

Question What is the process/steps for Vendor Conversion?
Answer Insert the Vendor info into the interface tables and perform the required validations:
AP_SUPPLIERS_INT
AP_SUPPLIER_SITES_INT
AP_SUP_SITE_CONTACT_INT
Run the below programs to load the data into the Base tables:
Supplier Open Interface Import
Supplier Sites Open Interface Import
Supplier Site Contacts Open Interface Import
Question Explain the set up used for Automatic or Manual Supplier Numbering.
Answer In the Financials Options window, you can set the Supplier Number entry option to either Autimoatic or Manual • Automatic: The system automatically assigns a unique sequential number to each supplier when you enter a new supplier.
• Manual: You enter the supplier number when you enter a supplier
Question Give the cycle from creating an invoice to transferring it to GL in AP.
Answer 1)Create Invoice 2)Validate Invoice 3)Create Accounting entries using Payables Accounting Process 4)Submit the Payables Transfer to General Ledger program to send invoice and payment accounting entries to the General Ledger interface. 4)Journal Import (GL) 5)Journal Post (GL)
Question You have created a new SOB. How will you attach this SOB to AP?
Answer Go to Payables Manager for the appropriate Operating Unit.
Navigation:Setup—>Set of Books—>choose.

 

 

> What is the process/steps for Vendor Conversion?

Insert the Vendor info into the interface tables and perform the required validations: AP_SUPPLIERS_INT AP_SUPPLIER_SITES_INT AP_SUP_SITE_CONTACT_INT Run the below programs to load the data into the Base tables: Supplier Open Interface Import Supplier SitesOpen Interface Import Supplier Site Contacts Open Interface Import

 

–> What is Invoice Tolerance?

We can define the matching and tax tolerances i.e how much to allow for variances between invoice, purchase order, receipt, and tax information during matching. You can define both percentage¿based and amount¿based tolerances.

 

–> Explain the set up used for Automatic or Manual Supplier Numbering.

In the Financials Options window, you can set the Supplier Number entry option to either Autimoatic or Manual ¿ Automatic: The system automatically assigns a unique sequential number to each supplier when you enter a new supplier. ¿ Manual: You enter the supplier number when you enter a supplier

 

–> What is Contract PO?

Contract PO is created when you agree with your suppliers on specific terms and conditions without indicating the goods and services that you will be purchasing.

 

–> What is a Payable Document?

A medium you use to instruct your bank to disburse funds from your bank account to the bank account or site location of a supplier.

 

–> In which table we can find the vendor number?

PO_VENDORS

 

–> Give the cycle from creating an invoice to transferring it to GL in AP.

1)Create Invoice 2)Validate Invoice 3)Create Accounting entries using Payables Accounting Process 4)Submit the Payables Transfer toGeneral Ledger program to send invoice and payment accounting entries to the General Ledger interface. 4)Journal Import (GL)5)Journal Post (GL)

 

–> What are the different types of Invoices in Payables?

Standard, Credit Memo, Debit Memo, Expense Report,PrePayment, Mixed, PO Default

 

–> You have created a new SOB. How will you attach this SOB to AP?

Go to Payables Manager for the appropriate Operating Unit. Navigation:Setup–>->Set of Books–>->choose.

 

–> In AP the suppliers didn¿t visible in India Creditors Ledger Report Parameter?

pls check whether that particular supplier is available in Suppliers addition inforamtion or not.

 

–> What will accrue in Payables?

Expenses and Liabilities

 

–> What is a Hold? Explain the types of Hold.

Payables lets you apply holds manually on an invoice, Payments etc to prevent the payment from being made or to prevent the accounting entries to be created etc. Some of the Payable holds are –> Invoice Hold, Accounts Hold, Funds Hold, Matching Hold, Variance Hold, Misc hold.

 

–> Which module is the owner of Vendor/Supplier tables?

Purchasing

 

–> What is Payment Terms?

Payment Terms let you define the due date or the discount date , due amount or discount amount. Once the payment terms are defined,you can attach these to the suppliers and supplier sites and these terms will be automatically populated once the invoice is enteredfor a supplier site.

 

–> How many key flexfields are there in Payables?

No Key Flexfields in AP

 

–> What is the Distribution Type while entering the Invoice?

Item, Tax, Miscellaneous,Freight, Withholding Tax

 

–> What are the Prepayment types?

Temporary and Permanent

 

–> What is Aging Periods?

Aging Periods window are the time periods for the Invoice Aging Report. The Invoice Aging Report provides information about invoice payments due during four periods you specify.

 

–> Whats the difference between the ‘Payables Open Interface Import’ Program and the ‘Payables Invoice Import’ program?

Payables Open Interface –> for importing regular invoices Payables Invoice Import –> for importing expense reports. In 11i renamed as Expense Report Import.

 

–> What is prepayment & steps to apply it to an Invoice?

Prepayment is a type pf invoice that you enter to make an advance payment to a supplier or employee. To Apply it to an Invoice ,inthe Invoices window, query either the prepayment or the invoice to which you want to apply it. Choose the Actions button and selectthe Apply/Unapply Prepayment check box. Click OK.

 

–> How you will transfer payables to general ledger?

Create Accounting. Transfer the transactions to GL_Interface Import the Journals Post the Journals

 

–> What program is used to transfer AP transactions to GL?

Payables Transfer to General Ledger Program

 

–> What is use of AP Accounting Periods?

In Payables accounting periods have to be defined to enter and account for transactions in these open periods. Payables does notallow transaction processing in a period that has never been opened. These periods are restricted to Payables only. The period statuses available in Payables are Never Opened, Future,Open, Closed, and Permanently Closed.

 

–> What are the different interface programs in AP?

Payables Open Interface Import to load Invoices and other transactions. Supplier Open Interface Import to load Suppliers. Supplier Sites Open Interface Import to load Supplier sites. Supplier Site Contacts Open Interface Import to load Supplier Site contacts.

 

–> What is Debit Memo & Credit Memo in Payables?

Credit Memo is a negative amount invoice you receive from a supplier representing a credit. Debit Memo is a negative amount invoice you send to notify a supplier of a credit you recorded for goods or services purchased.

 

Oracle Account Payables FAQs

 

  1. Do we enter the PO number in the invoice header or click on Match and then provide PO number? What is a good way of doing it?

 

Answer: If we do not enter the PO number at the header level it gives us the flexibility to match multiple POs to the same Invoice number. However, if you intend to match only 1 PO then it may be fine to use the PO number in the header.

 

  1. How to enter an invoice which relates to a receipt done in JDE? (How is it different from receipt in Oracle?)

 

Answer: Usually all the JDE receipt balances will be loaded in Oracle in the GRNI account with location value 4901. If the receipt is done in Oracle the location value will be 0000. Whenever you enter an invoice for a JDE receipt you should use the GRNI account with location value 4901 and DO NOT match it to any PO, Invoice or Receipt. Just enter the invoice header without any PO number and then save, validate and create accounting. This will reduce the GRNI account balance and consequently can be used to verify if all GRNI from JDE has been invoiced in Oracle.

 

  1. What holds can be manually released? What holds needs approval or further verification before release?

 

Answer: Some of the common holds that can be released manually –

 

1)      Amount – (Invoice  Amount Exceeded Limit)

 

2)      Amt Ord – [Amt billed > Amt Ordered * (1 + % Ordered Tolerance)]

 

3)      Amt Rec – [Amt billed > Amt Received * (1 + %Receipt Tolerance)]

 

4)      AP Manager – (Harsco: AP Manager Invoice Hold)

 

5)      Currency Difference – (Invoice Currency different from PO Currency)

 

6)      GB CHAPS Payment – (Harsco: Invoices selected for CHAPS payment – UK specific)

7)      Invalid PO – (Invoice has invalid or missing PO number)

8)      Max Ship Amount – (Variance between Invoice and Shipment Amount exceeds limit)

 

9)      Qty Ord – (Quantity billed exceeds quantity ordered)

 

10)  Qty Rec – (Quantity billed exceeds quantity received)

 

11)  Supplier – (Hold all un-validated invoices for the Supplier)

 

12)  Supplier Updated – (Supplier or Site Updated)

 

It is recommended that all the system generated holds should be investigated and resolved. Only the manually imposed holds should be released manually. Also, the system can be configured to disallow manual releases for the chosen hold types.

 

  1. What is invoice price variance?

 

Answer:

Invoice Price Variance OR IPV = (PO Price x Qty – Inv Price x Qty)

Note that if there is no difference in the price but there is a difference in quantity then the variance amount doesn’t fall under IPV.

 

  1. How does accounting of invoice price variance differ when the item is an expense item versus when it is an inventory item?

 

Answer: IPV for expense item gets accounted to the PO Charge Account. IPV for inventory item gets charged to the Material Price Variance account.

 

  1. What is Transfer Invoice Price Variance?

 

Answer: IPV for expense item cannot be transferred. However, IPV from Material Price Variance account can be transferred back to the Inventory average cost account. You can run this concurrent program from the AP Manager responsibility. The program forces you to enter an org since it transfers the IPV to the respective Inventory Org account.

 

  1. What are the different types of quantity holds?

 

Answer: The following types of quantity holds exist in the system:

 

1)      Max Qty Ord – Qty billed exceeds Qty ordered by tolerance amount

2)      Max Qty Rec – Qty billed exceeds Qty received by tolerance amount

3)      Qty Ord – Qty billed exceeds Qty ordered

4)      Qty Rec – Qty billed exceeds Qty received

 

 

  1. What should be done when Accounts payable trial balance (APTB) does not tally with AP liability account in GL

 

Answer: The following reasons could amount to difference in balances between APTB and AP Liability:

 

1)      There could be un-posted transactions in AP which have not been posted to GL.

Note: GL postings are part of a scheduled activity thus this can occur only between 2 subsequent schedules. Also, even if they are not posted they do not show up in the AP Liability report.

 

2)      There could be manual journal entries directly to AP Liability account which may not have been accounted in GL. Overall by rule of thumb; all manual transactions in GL can result in trial balance not tallying with AP Liability.

 

  1. In what scenarios does the AP invoice Aging Report total does not tally with AP Accounts payable trial balance total?

 

Answer: The following reasons could contribute to the mismatch:

 

1)      AP Trial Balance shows all accounted unpaid invoices. Whereas, AP invoice Aging Report shows all unpaid invoices whether accounted or not. Hence, they will NOT tally if there are unpaid invoices which are NOT accounted.

 

2)      Also, AP Aging Report picks the amount from the header of the invoice thus if the accounted lines total is different from the header amount then the same difference will be observed between Aging report and Trial Balance.

 

3)      Also, Aging Report is always generated as on date and does not have the flexibility to extract data for periods and date ranges.

 

  1. What is maximum ship amount hold?

 

Answer: When the difference between Invoice and Shipment Amount exceeds the tolerance limit then the system imposes a hold on the invoice called the “Max Ship Amount” hold. It can be caused due to IPV or Quantity Variance.

 

  1. In what ways can we raise an invoice if there is no PO / Receipt?

 

Answer: In the Invoice line type you can choose “item” if you have a corresponding item number. You may also choose the type as “miscellaneous” based on the requirement.

 

  1. In what scenario does the Prepayment Account GL balance doesn’t match the Prepayment Status Report?

 

Answer: Any manual journal entry for a prepayment or entry of a prepayment invoice where you change the account information to a non-prepayment account will result in difference in balances between Prepayment GL Account and Prepayment Status Report. Also, any unpaid prepayments will be accounted in Prepayment GL account however will show as “unpaid” in the status report.

 

In the parameters for Prepayment Status Report always select NO for “Include Invoices” and “Include Credits/Debit Memos”. This will ensure that the standard invoices/credit/debit memos against the prepayment suppliers are not included.

 

  1. In what cases do the GRNI (goods received not invoiced) accounts’ GL balance does not tally with PO Accrual Reconciliation Report?

 

Answers: The GRNI GL balances are loaded onto the PO Accrual Reconciliation report by way of a concurrent program which is called “Accrual Reconciliation Load Run”. This activity happens overnight each day to bring in balances onto the PO Accrual Reconciliation report. However, a user can run this program manually from the AP Manager responsibility. There could be many reasons for the GRNI GL Balance not matching to the PO Accrual Reconciliation report. The reason could be making manual journal entries. In order to investigate the discrepancy there are couple of standard Oracle reports which can help you decipher the problem. They are:

 

1)      Miscellaneous Accrual Reconciliation report – The purpose of this report is to show all inventory and AP (not matched to PO) transactions that have hit the accrual accounts. Transactions are grouped by accrual code. The report can be run either in summary where only the distribution information and balance is shown or in detail where all the transaction that makes up a particular distribution is shown as well. Usually this report is run in conjunction with the Summary Accrual Reconciliation Report as part of your period end accrual reconciliation process.

 

2)      Summary Accrual Reconciliation report – The Summary Accrual Reconciliation Report can be used to analyze the balance of the Accounts Payable (AP) accrual accounts. You can accrue both expense and inventory purchases as you receive them. When this happens, you temporarily record an accounts payable liability to your Expense or Inventory AP accrual accounts. When Oracle Payables creates the accounting for the matched and approved invoice, Oracle Payables clears the AP accrual accounts and records the liability from the supplier site. The Accrual Reconciliation Report helps you monitor potential problems with purchasing and receiving activities that can affect the accuracy of your A/P accrual accounts. It displays the balance of each accrual account as well as partial representation of source of the balance.

 

 

  1. Why should Receiving Inventory Account always have a zero balance? In what scenarios is there a balance in the account?

 

Answer: It is true that the Receiving Inventory Account should always have a zero balance.

There could be 2 reasons due to which the receiving account might have a balance.

 

1)      The Receiving account is more like a transition account before transferring it to the inventory account. Since we follow the direct delivery routing hence our items are not passing through the receiving account as of today. Thus, this cannot be the reason to have a balance in the Receiving account for us.

 

2)      Also, when we return items to the supplier sometimes we select the option “return to receiving” instead of “return to supplier”. This error can lead to the item being accounted in the receiving account. The technical team is working to have the option defaulted to “supplier” which will remove this scope of error.

 

Hence in future we should not see any balance in the receiving account.

 

 

  1. How can we avoid errors in foreign currency purchases or invoices?

 

Answer: One must always remember that if you are matching an invoice with a PO then in the “invoice form” the currency is defaulted from the supplier set-up information. This currency cannot be changed in the invoice. However, if you are entering an invoice without a PO number in the header then that gives you the flexibility to change the currency and query all invoices for that currency using the match option. The thumb rule is that the currency remains the same throughout the Requisition, PO, Invoice and Payment phases.

 

Note: During foreign currency payment always check the Bank Exchange Rate and exchange amount that the bank charges for doing a foreign currency disbursement. The same amount should be entered in the payment document. This will ensure that it hits the correct realized gain / loss account.

 

In cases, where match action is not required for an invoice, for e.g. no PO or receipt, you can simply enter the required currency and save the invoice.

 

Oracle Account Payables Interview Questions

 

1.What are the modules that are interfaced with Oracle payables?       

General Ledger, Purchasing,AOL,Cash Management,Assets.

 

2.How does the information defaults in payables?

Financial Option > Payables > Supplier > Supplier Site > Invoice > Distribution and  Schedule of Payment.

 

  1. What is a distribution set? what are the types of distribution set?

Distribution Set is to automatically distribute Invoice amount in to different GL Account code Combination.

Type of Distribution Set

Full Distribution and Skeleton Distribution Set

Full Distribution means we know the exact percentage and exact account code combination. The sum of the distribution percentages must equal 100 or 0.

Whereas in Skeleton we don’t the percentage but we know the GL Account Code Combination. So percentage should not be entered here.

 

4.What are the types of invoices used in payables?

Standard, Credit Memo, Debit Memo, Mixed, Prepayment, Expense Report, Withholding Tax, PO Default, Quick Match. Retainage Invoice

 

  1. What are the encumbrance options for AP? How are they used?

Requisition Encumbrance, and  PO Encumbrance available in Financial Option.

Encumbrance used to reserve the Funds at the time of raising the Requisition or creating of PO.

 

6.What are the different types of supplier sites?

Pay, Primary Pay, RFQ, Purchasing, Procurement Card.

 

7.What are the types of Accounting Methods?

Accrual, Cash.

 

  1. What is Automatic Offset Methods ?

Payables automatically create balancing accounting entries for your invoice and payment transactions.

Three types of Offset Methods 1. None, 2.Balancing, 3. Account.

 

9.What is a Pay Group?

Pay Group is to group invoices into supplier category for payments.

 

10.How do you create interest invoice?

In Payable Option under Interest Tab Allow Interest Invoices. Enable this option if you want to allow Payables to calculate interest for overdue invoices and create interest invoices for selected suppliers. Payables  automatically creates interest invoices when you pay overdue invoices in a payment batch or with a Quick payment. If you pay an overdue invoice using a manual payment, Payables warns you that interest is due on the invoice and you should pay the invoice in a payment batch or with a Quick payment.

 

11.What is GL Date Basis & Prepayment settlement date?         

The date you want Payables to use as the default accounting date for invoices during invoice entry.

 

  • Invoice Date. Invoice date you enter during invoice entry.
  • System Date. Current date for your Payables system. The date you enter the invoice.
  • Goods Received/Invoice Date. Date that you enter in the Date Goods Received field. If no value is entered, then the invoice date is used.
  • Goods Received/System Date. Date that you enter in the Date Goods Received field. If no value is entered, then the system date is used.

 

Prepayment Settlement Days. Number of days you want Payables to add to the system date to calculate a default settlement date for a prepayment. Payables prevents you from applying the prepayment to an invoice until on or after the settlement date.

 

12.What are the levels of Tax calculation?

Level at which the tax has to be calculated.

Levels: line level, header level and tax code level

 

13.What is additional Pay Through Days?            

Days specified in this column is added to the system date to select the invoice for payment which has the maturity date falling within these days

 

  1. What are Term date basis & pay date basis?

Term date basis

Date from which the due date will be calculated based on the payment term.

Pay date basis

Selection criteria of invoices based on the due date or  scheduled discount date.

 

  1. What are the types of payment terms?

Imme,30days, fixed due date, instalments ,proxima.

 

  1. What are holds in payables? How are they defined ?

Restriction on the invoice for  further processing.

Types: Manual and system holds. User can define any types of holds and can be attached to the invoice to stop further processing.

 

  1. How do you create a foreign currency invoice and a foreign currency payment ?

Any invoice that has been created from other than the functional currency.

Steps: Payables option ,in currency tab enable use multiple currencies.

 

Making foreign currency payment

In the payment format enable multiple currency option and in bank enable multiple currency payments under payable option tab.

 

  1. What are Expenses Report and Expense Report Template?

Invoice created for the expense made by the employee.

Expense report template

Defining default values for expense items, and you can then choose those items from a list of values when you enter expense reports.

 

20.What are recurring invoices?

A feature that lets you create invoices for an expense that occurs regularly and is not usually invoiced. Monthly rents and lease payments are examples of recurring payments.

 

  1. What are the perquisites for entering a Standard Invoice?

supplier, supplier site, payment term, payment method, distribution set(optional).

 

  1. What are Tax Recovery Rules?

Rules defined for the  amount of taxes that has to be recovered which  is usually a function of the nature (or intended use) of the taxable item.

 

  1. What are payment formats and payables documents?

Format in which the stationary has to be build i.e., where the attributes or the contents has to be placed.

Payment document

It is the actual negotiable or the legal document presented to the supplier.

 

24.What are the types of payment methods?

Check, electronic, wire, clearing, future dated(Bill of exchange). Two places where you assign the method one is financials option at supplier payables tab and he override option at supplier site level, payable tab.

 

25.what are the different types of payment methods?

Manual, quick and refund.

 

  1. What are the different types of taxes used in payables?

Sales, use tax, offset, user-defined, withholding tax.

 

  1. What is future dated payment method?

Payment of invoice where the due date(maturity date) falls in the future.ex- bill of exchange.

Steps: Enable future date use in the future dated payments tab at the payables document.

 

  1. How do you control accounting periods in payables?

setup–accounting–ap accounting periods

There is option of toggling between various status.

Never opened, Future ,Open, Closed ,Permanently closed.

 

  1. What are the Payment Programs?

 

The following are the Payment Programs which is used in the payment batches.

  1. Build Payment Programs
  2. Format Payment Programs
  3. Separate Remittance Programs.

 

Build Payment Programs

It groups the Invoices of the suppliers in the manner in which payment should be made.

 

Format Payment Programs

This program is used to know the layout of the payment documents and accordingly format the payments.

 

Separate Remittance Programs

If the Payment Documents does not contains the Remittance advice, then we need to run the Separate Remittance Programs other this will run along with Payment Documents.

 

  1. What is difference between entering Invoices in Invoice Gateway and Invoice Work Bench Window?

Invoice Workbench used for entering and maintaining more complex invoices for which you require extensive online validation and online defaulting where as Invoice Gateway used for your everyday entry of invoice records. Use this window for rapid, high–volume entry of Standard and Credit Memo invoices that are not complex and do not require extensive online validation or defaulting of values during entry.

 

When you use the Invoice Gateway, you enter invoice header and line information in the same window, and can view only one record at a time. In the Invoice Workbench, you enter invoice header information in the Invoices window, and the related invoice distributions in the Distributions window. You can view multiple invoices at the same time in the Invoices window.

 

In the Invoice Workbench we can enter and apply prepayments. In the Invoice Gateway we cannot enter prepayments, but we  can apply existing prepayments to invoices you enter.

 

  1. What are the tables involved in AP Invoice Interface?

AP_INVOICES_INTERFACE

AP_INVOICE_LINES_INTERFACE

 

  1. What is Proration of Invoice Lines?

When you check the Prorate in the Invoice Lines it will prorate expenses and Tax according to the Proportion of Line amount in the Invoice.

 

  1. What are the Offset Taxes? Where it is Used?

Offset Taxes

Offset tax codes are used to record self–assessed taxes on invoices, while reducing or completely offsetting tax liability. Offset taxes have negative–amount rates, so when you use them, you enter negative–amount invoice tax distributions.

 

It used in European Union,  if you are a member of the European Union (EU), you can report on these zero–rated taxes using the Intra–EU VAT Audit Trail report.

 

34.What are the types of Holds that are used to prevent the payment of Invoice?

Holds that we can apply manually or that Payables applies, prevent payment and, in some cases, creation of accounting entries for an invoice. We can remove holds that we apply, and we can manually release certain holds that Payables applies during Approval.

 

Payables provides some generic invoice holds for our use, and we can define our own, based on our invoice approval needs. We can also prevent payment of supplier invoices by placing a hold on the supplier rather than on each individual invoice.

 

There are two major category of hold 1] Manual Hold 2] System Hold.

 

Manual hold we can create and release manually where as system hold is created by system and normally released by system after due rectification.

 

There are three types of holds we can use to prevent payment of an invoice

 

Invoice Hold. We can manually apply one or more Invoice Hold Reason Approvals (”holds”) to an invoice using the Invoice Holds window of the Invoice Workbench.

 

Scheduled Payment Hold. We can hold payment on part of an invoice by placing one or more of the scheduled payments on hold in the Scheduled Payments window of the Invoice Workbench.

 

Supplier Hold. In the Supplier Sites window, we can enable the Hold All Payments, Hold Unapproved Invoices, or Hold Unmatched Invoices options. We also have the option of

specifying an Invoice Amount Limit for a supplier site.

 

35.What are the  hold option at the supplier Site?

In the Supplier Sites window, we can enable the Hold All Payments, Hold Unapproved Invoices, or Hold Unmatched Invoices options. We also have the option of specifying an Invoice Amount Limit for a supplier site.

 

  1. What are the ways in which invoice can be approved?

Before you can pay or create accounting entries for an invoice, including prepbayments, you must submit Approval for the invoice in one of three ways:

 

  • Online by using the Invoice Actions window.
  • Online by using the Approve button in the Invoice Batches
  • Batch by submitting the Payables Approval program from the Submit Request window.

 

37.What are the methods of taking Discounts in Payables?

There are two ways to take discounts with Payables:

  • Enable the Always Take Discount Supplier option. Payables  takes a discount regardless of when you pay the invoice.

 

  • Select Discount for the Pay Date Basis for the supplier, and disable the Pay Only When Due check box for your payment batch. Payables takes a discount and pays the invoice within the discount period.

 

  1. What are the matching approval Levels?

Match Approval Level. If we use Oracle Payables with Oracle Purchasing or another integrated purchasing product, we can perform online matching of invoices and original purchase orders or purchase order receipts. Matching ensures that we only pay for the goods and services we ordered and that our suppliers do not over–billed us. If we are billed for an item over the amount and quantity tolerances we define, the Payables Approval Program applies holds to the invoice and prevents payment until we release the holds.

 

39.What are the Payable Open Interface Table?

The Payables Open Interface tables store invoice information. The Payables Open Interface Import program builds Payables invoices based on the invoice records in the Payables Open Interface tables.

After the import program builds the invoices, they can be viewed, modified, and approved in the Invoice Workbench.

The invoice data is from e–Commerce invoices from your suppliers, invoice records that you entered in the Invoice Gateway window, invoices that you loaded with Oracle SQL*Loader, lease invoices that were transferred from Property Manager, and credit card transaction data.

 

40.What are the Invoice Matching Option?           

The following are the Invoice Matching Option  available :

 

Purchase Order Matching

 

2–Way. When you match to a purchase order or receipt, Payables Approval performs these control checks:

  1. Quantity billed <= Quantity ordered (Symbol mean lessor)
  2. Invoice price <= Purchase order price

 

Receipts Matching

 

3–Way. Control checks 1 and 2, plus:

  1. Quantity billed <= Quantity received

 

Invoice Matching

 

4–Way. Control checks 1, 2, and 3, plus:

  1. Quantity billed <= Quantity accepted

 

  1. What is the Prepayment Invoice? What are the Types of Prepayment Invoice?

prepayment is a type of invoice we enter to make an advance payment to a supplier or employee.

 

The Following are the Two Types of Prepayments

 

  1. Temporary and
  2. Permanent.

 

Temporary prepayments can be applied to invoices or expense reports you receive.

 

Permanent prepayments cannot be applied to invoices.

 

  1. What are the purchase order matching database table?

Payables uses several of Oracle Purchasing tables for matching. To implement matching in Payables, you need to load these tables with the data from your non–Oracle purchasing application.

 

The following are the list of such tables :

 

  • PO_HEADERS
  • PO_LINES
  • PO_LINE_LOCATIONS
  • PO_DISTRIBUTIONS
  • PO_DISTRIBUTIONS_AP_V (view of PO_DISTRIBUTIONS)
  • PO_RELEASES (Blanket Purchase Orders)
  • PO_LOOKUP_CODES

 

AutoInstall automatically installs these and other necessary Oracle Purchasing application tables when you install Payables.

 

  1. What are the pre-requisites for entering Payments?

The following are the pre-requisites:

 

  1. The invoice(s) we paid must be approved, uncancelled, validated, without holds, and must have the same currency as the payment.

 

  1. The bank account must have at least one payment document that uses the Recorded or Combined disbursement type.

 

India Localization:

  1. How should I define surcharge for a TDS Tax?

You need to enter (in the Surcharge field on the Tax Definition) exact percentage that

has to be applied on the Invoice amount.

For example: In a case where TDS Tax Rate is 2% and a Surcharge of 10% is applicable

for this Tax. You should specify 0.2 in the Surcharge field.

  1. What should be the Setup steps when I wish to implement TDS features only?

Setup only Step 16-21 of the India Localization Setups. Refer to the Setup Overview

chapter of the India Localization User Guide.

Following India Localization Setups need to be completed:

  • Define TDS Related Information for the Organization
  • Define Income Tax Authority
  • Define TDS Sections
  • Define TDS Tax Codes
  • Defining TDS year Information
  • Define TDS Details for Suppliers

 

  1. What is the impact of assigning a Default TDS Tax Name to the Supplier Site?

This would automate TDS Calculation for every Invoice created for the Supplier Site.

This happens in spite of the fact that you override/ delete the TDS Tax Id before saving

the Invoice Distribution.

 

  1. How many TDS Invoices are created when multiple Invoice Distributions have

the same TDS Tax Id?

Invoice created for the TDS Authority and the Credit Memo for the Supplier would be

consolidated for all Invoice distributions having the same TDS Tax Id.

 

  1. What will be a pre-requisite to assign WCT Type of Taxes on Invoice?

It is necessary to assign a TDS Tax Id before you specify a WCT Tax Id. However, if you

only have WCT applicable to the Invoice, then, assign this code in the TDS Tax Id field.

For Supplier who does not have TDS Applicability but only have WCT calculated for

services provided by them, then, assign the WCT Tax Id in the default TDS Tax Name

field.

 

  1. What will be impact on TDS Invoices when Prepayment Invoice with Single TDS

Code, applied to Standard Invoice has different TDS Codes attached?

TDS calculated on the Standard Invoice would be reversed in proportion of the amount

applied to the Total Amount Standard Invoice bearing TDS.

 

  1. What happens when Standard Invoice having multiple TDS Codes is applied to a

Prepayment Invoice with multiple TDS Code?

TDS calculated on the Prepayment Invoice distribution to which the Standard Invoice is

applied is considered for reversal.

TDS Amount calculated on the applied Prepayment line would be reversed in

proportion to the amount applied to the Total Amount Prepayment Invoice.

 

  1. Why should the user define a Fin Year for TDS? What is the impact of creating

such Fin Year? When should I close the current Fin Year?

This is mandatory for calculating TDS on Invoices. Also, the TDS Certificate Number

would be re-set every Fin Year.

Once the current financial year-ends, you will have to navigate to the TDS Period India

Localization screen and press ‘New Financial Year’ button.

racle Account Payables Interview Questions

 

1)      What are the encumbrance options for AP? How are they used?

Requisition Encumbrance, and PO Encumbrance available in Financial Option. Encumbrance used to reserve the Funds at the time of raising the Requisition or creating of PO.

 

2)      What are the different types of supplier sites?

Pay, Primary Pay, RFQ, Purchasing and Procurement Card.

 

3)      What are the types of Accounting Methods?

Accrual and Cash.

 

4)      What is Automatic Offset Methods?

Payables automatically create balancing accounting entries for your invoice and payment transactions. Three types of Offset Methods are None, Balancing, Account.

 

5)      What are the tables involved in AP Invoice Interface?

AP_INVOICES_INTERFACE           AP_INVOICE_LINES_INTERFACE

 

6)      What are the Offset Taxes? Where it is used?

Offset Taxes:

Offset tax codes are used to record self–assessed taxes on invoices, while reducing or completely offsetting tax liability. Offset taxes have negative–amount rates, so when you use them, you enter negative–amount invoice tax distributions.

It used in European Union,  if you are a member of the European Union (EU), you can report on these zero–rated taxes using the Intra–EU VAT Audit Trail report.

 

7)       What are the different types of taxes used in payables?

Sales use tax, offset, user-defined and withholding tax.

 

8)      What are the different types of payment methods?

Manual, quick and refund.

 

9)      What are the perquisites for entering a Standard Invoice?

Supplier, supplier site, payment term, payment method, distribution set (optional).

 

10)  What are Term date basis & pay date basis?

Term date basis: Date from which the due date will be calculated based on the payment term.

Pay date basis: Selection criteria of invoices based on the due date or scheduled.

 

11)  How do you create interest invoice?

In Payable Option under Interest Tab Allow Interest Invoices. Enable this option if you want            to allow Payables to calculate interest for overdue invoices and create           interest invoices for selected suppliers. Payables automatically create interest invoices when you pay overdue invoices in a payment batch or with a Quick payment. If you pay an overdue invoice using a manual payment, Payables warns you that interest is due on the invoice and you should pay the invoice in a payment batch or with a Quick payment.

 

12)  What is a distribution set? What are the types of distribution set?

Distribution Set is to automatically distribute Invoice amount in to different GL Account code Combination.

Type of Distribution Set:

  • Full Distribution:

Full Distribution means we know the exact percentage and exact account code combination. The sum of the distribution percentages must equal 100 or 0.

  • Skeleton Distribution Set:

Whereas in Skeleton we don’t the percentage but we know the GL Account Code Combination. So percentage should not be entered here.

 

13)  What are the modules that are interfaced with Oracle payables? 

General Ledger, Purchasing, AOL, Cash Management and Assets.

 

14)  How does the information defaults in payables?

Financial Option > Payables > Supplier > Supplier Site > Invoice > Distribution and Schedule of Payment.

 

15)  What are recurring invoices?

A feature that lets you create invoices for an expense that occurs regularly and is not usually invoiced. Monthly rents and lease payments are examples of typical recurring payments.

 

16)  What is the Prepayment Invoice? What are the Types of Prepayment Invoice?

prepayment is a type of invoice we enter to make an advance payment to a supplier or employee.

The Following are the Two Types of Prepayments

  1. Temporary prepayments can be applied to invoices or expense reports you receive.
  2. Permanent prepayments cannot be applied to invoices.

 

17)  What is the Payable Open Interface Table?

The Payables Open Interface tables store invoice information. The Payables Open Interface Import program builds Payables invoices based on the invoice records in the Payables Open Interface tables.

After the import program builds the invoices, they can be viewed, modified, and approved in the Invoice Workbench. The invoice data is from e–Commerce invoices from your suppliers, invoice records that you entered in the Invoice Gateway window, invoices that you loaded with Oracle SQL*Loader, lease invoices that were transferred from Property Manager, and credit card transaction data.

 

18)  What are the ways in which invoice can be approved?

Before you can pay or create accounting entries for an invoice, including prepayments, you must submit Approval for the invoice in one of three ways:

  • Online by using the Invoice Actions window.
  • Online by using the Approve button in the Invoice Batches
  • Batch by submitting the Payables Approval program from the Submit Request window.

 

19)  What are the hold options at the supplier Site?

In the Supplier Sites window, we can enable the Hold All Payments, Hold Unapproved Invoices, or Hold Unmatched Invoices options. We also have the option of specifying an Invoice Amount Limit for a supplier site.

Oracle Account Payables FAQS

 

 

  1. Suppliers

 

1.i                   There is more than one account for the same supplier, which one do I choose?

 

Check the supplier site addresses and choose the supplier whose site address matches your invoice address. If none of them match your invoice then ask DP section to create a new site. If all the supplier accounts have the same site addresses then choose the Supplier with the lowest number. We are in the process of merging all the multiple accounts into one.

 

1.ii                 I cannot find a supplier or an employee on the database

 

Please send details of the supplier or employee to DP section. Minimum details required are as follows:

  • Name and full address
  • If an individual please confirm if the person is an employee or not
  • Standard forms for full supplier set-up can be obtained from DP section.

 

  1. Batch Headers

 

2.i                   How to print batch headers

 

  • Select the batch header you want to print by clicking on Query, and Find. Then enter the batch number you require and click on the Find button

The system brings up the batch details

  • Confirm that you have the right folder open ie UCL BATCH HEADER
  • Click on the Action menu and then click Print
  • A copy of the batch header would be printed on your printer

 

2.ii                 Can I adjust or delete batch header details?

 

  • You can add invoices to a batch at any time
  • You can change the invoice type on the batch header after entering invoices against a batch and the new invoice type will default onto new invoices entered after the change. Changing the batch header does not affect invoices entered before the change

 

  • You can delete an invoice from a batch at any time before the invoice has been approved. See 5.i

 

  • You cannot delete an invoice batch that contains invoices. If you want to delete an invoice batch, you must delete the invoices in the batch first. See 5.i

 

  1. Grant related Invoice Distributions

 

3.i                   I am unable to post an expense claim to a grant

Please check that you have used the standard invoice type and not expense report type. If you have used the wrong invoice type then you would have to delete the invoice and re-enter the invoice. See 5.i

 

3.ii                 I am unable to enter a grant distribution against a 6P … expenditure type because the system is requesting for a valid quantity

 

Please enter the expenditure amount in the quantity field.

 

3.iii               I wish to enter a distribution against a grant code but the system is requesting for an expenditure Item date

 

In this case you are trying to enter an expense against a completed grant. Please confirm the completion date of the grant and enter a date on or before the grant completion date. You can confirm the date as follows:

  • Select the grant field
  • Click on the picklist button on the toolbar or press CTRL+F11
  • Enter the grant code and click the Find button

The system would then bring up brief details about the grant.

  • Scroll to the right to view the grant completion date.

 

 

3.iv               I have entered my distributions against grant codes and the system generated account codes are different from the grant codes that I entered?

 

The grants were set-up to map to control accounts in the general ledger. The account codes for these control accounts are different from the grant codes that you have entered. See further details on COA Philosophy document on the NewFis website

 

  1. VAT Distributions

 

4.i                   How do I confirm that the VAT amount is correct before the first level approval process is run?

 

After entering all your distribution lines,

  • Select Special on the menu options at the top of the window.
  • Choose Generate VAT distributions. The system then comes up with a note indicating that VAT is being calculated, click OK on the box and wait for the system to complete the process by bringing up the VAT lines and updating the distribution total.
  • Check that your Invoice total agree with the distribution total, if not then make the necessary changes as described in section 4.ii below.

 

4.ii                 System calculated VAT amount does not agree with the invoice VAT amount due to rounding differences or insignificant arithmetical errors on Supplier invoices

 

Manually change the system calculated VAT amount on the VAT distribution line to agree with the invoice VAT amount.

 

4.iii               Most of our expenses are VAT recoverable, and I am not sure of the VAT codes to use

Recoverability is now defined at the account code level. The code to enter is the one that corresponds with the VAT rate on your invoice. Please find further details on the VAT overview document on the Newfis website.

 

  1. Adjusting and deleting invoices and invoice distributions

 

5.i.i            If invoice is unapproved (first level approval has not been done)

 

  • Ensure that you are on the invoices window and the cursor is on the invoice line that you wish to delete
  • Click on the red X button on your toolbar
  • Click OK on the delete message box.
  • Once the deletion is completed save your work.

 

5.i.ii          If invoice is approved ie after 1st or secondary level approval

 

An approved Invoice cannot be deleted because funds have already been committed against the invoice during the approval process. However, the system would allow you to cancel the invoice.

 

5.ii                 How do I cancel an invoice that has been approved?

 

  • Navigate to the invoices window
  • Select the invoice to be cancelled. Please note that if you wish to re-enter the invoice it is advised that you add A to the number of the invoice to be cancelled and then re-enter the invoice with the number as written on the Supplier invoice. This is necessary because the system would not allow you to enter the same number twice for the same supplier.

 

  • On your invoices screen, click on the Actions..1 button and this brings up the Actions wndow.
  • On the Actions window click on the Cancel Invoice check box
  • Click OK and click OK to the messages that come up during the cancellation process.
  • Once the process have been completed save your work

 

5.iii               I have entered an expense claim with the wrong invoice type, how do I correct this error

 

Delete the invoice and re-enter it with the standard invoice type.

 

5.iv               I How can I amend input errors on my distribution window

 

  • Before approval

 

Purchase order matched distributions cannot be adjusted but can be reversed and the correcting entries entered on a new distribution line.

 

Distribution details that are not generated from purchase orders can be changed or deleted before the first level approval stage. Follow the procedure for adjusting invoices and remember to save your work .

 

  • After first Level Approval

 

Distributions cannot be amended or deleted once they have been approved. The system would only allow you to reverse the entries by clicking on the Reverse …1 button.

 

  1. Invoice Approval

 

6.i                   After running the batch approval process, how do I confirm that all the invoices in the batch have been approved?

 

  • The batch approval process normally takes a few minutes to run. The time it takes depend on the number of entries in the batch and how busy the system is. Please wait a few minutes before checking that all the invoices in your batch  have been approved.

 

  • After waiting for a few minutes you may open the invoices window of the batch and click on Query, then Run. This refreshes the screen and you may then check if your invoices have been approved by reviewing the holds placed on them.

 

  • Another alternative is to view your requests by carrying out the following:
  1. Click on the help menu and select View My Request and the Find request window comes up.
  2. Click on the Find button and this takes you to the Requests window.

iii.       On the Requests window click on the refresh data button and the system would bring up all your outstanding requests and show the status of your requests ie whether it is pending, running or completed. If not completed click refresh again after a few minutes and click again until completed.

 

  • If you process large volumes of batches then it is advisable to print the Invoice on Hold report once or twice a day instead of checking batches individuallySee page 45 of your AP training documentation for guidance on how to print reports.

 

6.ii                 I have approved my invoices but don’t know where they have gone for secondary approval?

Invoices are automatically available for all authorised signatories in your Department once the First Level approval is carried out. You do not need to send them to anyone for approval.

 

6.iii               An invoice was not approved in my batch of 10 invoices. Does this stop the rest from being processed further?

 

 

No

 

  1. General advice

7.i                   It is advisable that you print out or review the Invoice on Hold Report at the end of every day to ensure that all your invoices were successfully entered.

 

7.ii                 You may approve more than one batch at a time. To do this

  • Navigate to the Invoice batches window
  • Press the SHIFT key and then click on the invoice batches that you wish to approve. The batches would become highlighted in blue and the Approve button would indicate the number of batches that you have highlighted
  • Lift your finger off the shift key and then click on the approve button

The system would ask you to confirm the number of batches to be approved.

  • Click OK

 

7.iii               The on screen ‘help’ is very useful and provides the following information:

  • Window help: topics relating to the window you are working on
  • Keyboard help : A list of keyboard shortcuts
  • View My Request : Confirm the status of your requests
  • About this Record:  Details of who created a record and when it was created

 

The Invoice document is used to bill the Buyer for services and/or products delivered by the Seller.

Credit is the means by which we are able to obtain immediate benefit of goods or services upon the promise of payment at a future date.

Credit memo: When you want to adjust an invoice, document issued by the vendor to record an adjustment against an invoice.

 

Description The supplier presents to the customer for the ordered or delivered, received or consumed goods or services a detailed invoice.  The customer disputes the invoice and works with supplier to resolve issue.  If any discrepancy is found, the customer shall start the process to treat incorrect invoices.  Once Supplier and Customer agree upon the nature of the dispute, Supplier issues a credit memo to correct the problem.  Buyer receives credit memo, reconciles with order and contract information and issues payment.

Negative = Credit

Positive = Debit

Verify its correctness.

    • Note the reason for the credit if it is not clear on the credit memo itself
    • Indicate the account and center where the credit should be applied.
    • Forward all credits to Accounts Payable immediately so that the credit can be applied to your cost center and deducted from the next payment to the vendor. DO NOT HOLD CREDITS IN THE DEPARTMENT FOR ANY REASON.
    • Accounts Payable will apply the credit against any open invoices in the system.
    • Make a copy for your records.

 

Debit memo: Negative amount invoice created by us and sent to supplier to notifying him about the credit we are recording.

AP is divided in to 2 workbenches.

Invoice workbench

Payable workbench

 

We usually enter supplier invoice either in Invoice workbench or quick invoice window.

Invoice workbench:

Contains:

  • Invoice Batch window
  • Invoice window
  • Distribution window
  • Other associated windows

When to use:

  • Incase of complex invoices or invoices that requires online validation.
  • When an invoice requires immediate action.

Quick invoice window:

  • Used for quick high volume invoice entry for invoices that don’t requires extensive validation.

After entry just import into payable system, validation and defaulting will occur during import.

For more see page 342 of Oracle payables.pdf

Invoice distribution:

It allocates total invoice allowance to various expense or asset accounts.

 

Expanse Reports:

 

Invoice Creation:

Invoice Distributions:

Account: Company have different COA so follow that hierarchy for each set of item.

Accounting Date: Date when we are planning to post it to GL ie. GL Date.

 

Payments:

 

Record: Manual payments(checks,wire) which are made out of OP and they will be recorded in Op and update the invoice for which you have paid.

Computer Generated:

Combined:

 

 

Payment:

 

Lookup: It is a predefined values used as a LOV. In some fields we select a value from a predefined set of values, In some cases we have defined them in the setup windows such as supplier name,payment terms or tax codes. Other predefined set of values are Lookup codes.

LOOKUP CATEGORYÈ LOOKUP TYPE EX. INVOICE TYPE

Allowed values are called Lookup names. Ex. Standard, Debit memo, Credit ,memo, Prepayment.

For a lookup type we can define upto 250 Lookup names.

 

Navigation:

SetupèLookups

For more details see Developer’s Guide pg. 58.

 

Distribution Sets:

It is a predefined set of distribution for a repeated or a same set of distribution form a supplier. We can either link it to supplier site or we can link it to the invoice.

There are 2 types of distribution sets.

Full Distribution Sets:  We will define % amount of the invoice to each distribution line and sum of all lines must be either 0 or 100. We can enter –ve % values.

Skeleton Distribution Sets: Leave the % field as 0 so that at the time of invoice creation you ca enter amount in different distribution lines.

 

For more details see Developer’s Guide pg. 63.

 

Purchase document:

 

Use Bank window to define internal bank branch from which you disburse payments. For each bank account we can define payment document for check, EFT, EDI or wire transfer and other payment methods.

 

 

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