Oracle Financials R12 1

Oracle Financials R12 2

 Effort Sincerity Perfection

Oracle Financials R12

Shrikannth

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Oracle Financials R12 4
 It’s not my merit, but His grace…

Dedicated to my beloved Guruji

Sri Karra Satya Surya Bhagavan

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 Table of Contents

Foreword...............................................................................................10
Acknowledgements................................................................................14
1. Oracle Financials Introduction.......................................................15
2. Oracle Applications Navigation.......................................................16
3. System Administration..................................................................18
4. Flexfields........................................................................................19
5. MulMulti Org..................................................................................21
General Ledger......................................................................................21
6. General Ledger...............................................................................22
Payables................................................................................................22
1.1 Overview.......................................................................................................23
1.2 Objective.......................................................................................................25
1.3 Accounts Payables Setups............................................................................25
1.3.1 Define Set of Books...................................................................................26
1.3.2 Profile Values............................................................................................26
1.3.3 Define Lookup Codes...............................................................................26
1.3.4 Define Distribution Sets...........................................................................27
1.3.5 Define Financial Options.........................................................................30
1.3.6 Define Payable Options............................................................................36
1.3.7 Define Special Calendars..........................................................................48
1.3.8 Define Payment Terms.............................................................................49
1.3.9 Signing Limits..........................................................................................50
1.3.10 Invoice Tolerances....................................................................................51
1.3.11 Invoice Hold and Release Names.............................................................52
1.3.12 Interest Rates............................................................................................53
1.3.13 Define Banks.............................................................................................54
1.3.14 Define Tax Codes......................................................................................61
1.3.15 Define Tax Groups....................................................................................63
1.3.16 Payment Formats.....................................................................................64

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 1.3.17 Create Employee Expense Report............................................................65
1.3.18 Define Aging Periods................................................................................69
1.3.19 Accounting Periods...................................................................................70
1.4 Define Suppliers............................................................................................71
1.5 Invoices........................................................................................................80
1.5.1 Standard Invoice.......................................................................................81
1.5.2 Credit Memo.............................................................................................93
1.5.3 Prepayment Invoices................................................................................98
1.5.4 Matching to Purchasing..........................................................................109
1.5.5 Maintain Invoices....................................................................................115
1.6 Payments....................................................................................................124
1.6.1 Automatic Payments...............................................................................124
1.6.2 Quick Payments/Manual Payments.......................................................132
1.6.3 Modify Payments.....................................................................................141
1.6.4 Payment Cancellation.............................................................................143
1.6.5 Void Payment..........................................................................................145
8.1 Inquiry........................................................................................................149
8.1.1 Supplier Inquiry......................................................................................149
8.1.2 Invoice Inquiry........................................................................................150
8.1.3 Payment Inquiry......................................................................................151
8.2 Period Process............................................................................................152

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Oracle Financials R12 8
 Foreword

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Oracle Financials R12 10
 Preface

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Oracle Financials R12 12
 Acknowledgements

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 CHAPTER
1
Oracle Financials
Introduction
1. Oracle Financials Introduction

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 CHAPTER
2
Oracle Applications
Navigation
2. Oracle Applications Navigation

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1.

CHAPTER
3
System
Administration

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3. System Administration

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 4. Flexfields

2.

CHAPTER
4
Flexfields

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 5.

3.

CHAPTER
5
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 Multi Org
5. MulMulti Org
4.

CHAPTER

General Ledger
6
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 6. General Ledger

7. Payable
5.

CHAPTER 7
Payables

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 ayables is one of the modules in the Financials

P Suite. This module is intended to handle recording

all liabilities and making payments and
prepayments.

Overview
The Accounts Payable module provides a high productivity accounting
solution and facilitates to enter invoices and make payment of all
suppliers, both internally and externally, as well as records, monitors,
and controls all activities related to the expenditure and disbursement
of funds. It is fully integrated with General Ledger.

It is responsible for recording details of invoices received from

suppliers into the system and matching them to purchase orders when
appropriate. Invoices and credit notes entered onto the system can be
matched where appropriate to purchase orders, approved on line and
will automatically reverse out the commitment originally generated by
the purchase order.

Accounts Payables include two fully integrated workbenches, the

Invoice Workbench and the Payment Workbench. You can perform
most of your transactions in Payables using the Invoice Workbench or
the Payment Workbench.

You enter, adjust, and review invoices and invoice batches in the
Invoice Workbench. Y0u create, adjust and review payments and
payment batches in the Payments workbench.

Accounts Payables fully integrates with Purchasing and other

purchasing systems. This allows you to access your purchasing

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information online and match invoices to purchase orders or purchase
order receipts.

Oracle Payables supports the management of supplier (vendor)

relationships and of payments due. Payables business processes can be
broken down as follows:

 Supplier management (shared activity with Purchasing);

 Invoice creation;
 Employee expenses;
 Adjustments;
 Payments;
 Account management; and
 Periodic activities.
Payables Process Overview Diagram

Supplier Employee Payment PayablesAccount

Invoices
Management Expenses Processing Management

Create / Maintain
Supplier Information Enter and Approve Enter/Approve Manage Accounts &
Generate Checks
(shared activit iy -- see Supplier Invoices Employee Advances Supplier Relationships
details in Purchasing)

Periodic
Enter/Maintain Enter, Reconcile and Activities
Match to PO & (opt.)
Employees as Approve Employee Reconcile Payments
Receipts
Suppliers Expenses

Period Closing
Activities (Transfer
Invoice/Supplier Journal Entries to GL)
Adjustments
Manage Invoice Holds

Enter Credit /Debit Oracle General Ledger

Memos Journal Entries
Maintain Invoices
(Modify, Cancel)

Exhibit 7.1

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Objective
After completing this chapter, you will be able to perform these
activities:

 Payables Setup Steps

 Defining Suppliers
 Creating Invoices
 Maintain Invoices
 Payments
 Modify Payments
 Inquiry
 Period Process

Accounts Payabele Functions

Process Flow:

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  Invoices
 Payments
 Accounting
 Suppliers
 Employees
 Credit Cards

Drill down menu of Payables as shown Below:

Setups:

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Users to perform setup tasks

1. One or more users should be created to perform the setup tasks.

2. The following responsibilities to be assigned to the user
3. General Ledger Super User – to define Set of books
4. System Administrator – to set system profile options, create
responsibilities etc.,
5. Payables Manager - Perform payables related setups
6. Purchasing Super User - Perform purchasing related setups.
7. HRMS Manager - Set up employees, hierarchies, locations, and
organizations.

Perform the setups mentioned below

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Note: * Discussed in Flexfield, GL and HRMS Modules

1. Define Ledger
2. Profile Values
3. Define Lookup codes
4. Define Distribution Sets
5. Define Financial Options
6. Define Payable Options
7. Define Special Calendars
8. Define Payment Terms
9. Define Signing Limits
10. Setup Invoice Tolerances
11. Setup Invoice Hold and Release Names
12. Define Interest Rates
13. Define Banks
14. Define Tax Codes
15. Define Tax Groups
16. Define Payment Formats
17. Create Employee Expense Report
18. Define Aging Periods

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 19. Accounting Periods

Define Ledger
Define Chart of Accounts, Calendar, Currency, Cross validation rules.
Skip this step if you have already installed and setup General Ledger.

Profile Values
Oracle Payables uses system profile options to determine how to
process, and control access to, data.

From the payables menu>Other>Profile

Enter AP% Profile value to query

Click on Find

Enter the relevant profile value at the appropriate level.

Define Financial Options

Define the options and defaults in the Financials Options window to use
for Oracle Financial Applications. These options are shared by Oracle
Payables, Oracle Purchasing, and Oracle Assets. Use the Financials
Options window to define the options and defaults that you use for your
Oracle Financial Application(s). The Values you enter in this window
are shared by Oracle Payables, Oracle Purchasing, and Oracle Assets.
You can define defaults in this window to simplify supplier entry,
requisition entry, purchase order entry, invoice entry, and automatic
payments.

Navigation: Setup>Options>Financials
Financial Options Regions

 Accounting
 Supplier
 Encumbrance
 Tax

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  Human Resources

Financials Options - Accounting Tab:

Liability: Payables assign 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

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new supplier sites. The bank account value defaults to new payment
documents.

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

PO Rate Variance Gain/Loss. Payables 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.

Expenses Clearing. This account is optional when you use the

Company Pay payment option of Oracle Internet Expenses. Payables
uses this as a temporary account to record credit card transaction
activity

Miscellaneous. Used only when importing invoices submitted via

iSupplier Portal or XML Gateway.

Retainage: Used for the amounts or percentages of payments that are

withheld until work under a contract is completed and accepted

Financial Options - Supplier – Purchasing

The options you define in this region, except for Inventory

Organization, are used as default values for the Purchasing region of the
Suppliers window. The supplier values default to new supplier sites for
the supplier, which default to new purchasing documents for the
supplier site.

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Oracle Payables use the vendor information to assign default values
when you enter new vendors.
1. RFQ Only Site: Default value for all new suppliers.
2. Select Ship-To Location: Default value for all new suppliers.
3. Select Bill-To Location: Defualt for all new suppliers.
4. Select Inventory Organization etc: You need to choose an
inventory organization if you use Purchasing. You can associate
each of your Purchasing installations with one inventory item
master organization. When you associate your Purchasing
installation with an inventory organization, items you define in
this organization become available in Purchasing. You can only
choose an inventory organization that uses the same set of books
as your Purchasing installation.
5. Note: Do not change the Invntory Organization after you have
already assigned one to Purchasing.

6. Ship Via: Shipping method type. Use Define Supplier

QuickCodes window to create shipping methods.
7. FOB: Select the default FOB that should apply tor the suppliers.

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 8. Freight Terms: The freight terms for a suppliers identify
whether you or your supplier pays for freight charges on goods
you receive.

Financial Options - Encumbrance

To use encumbrance accounting or budgetary control, you must install

Payables, Purchasing and General Ledger. Use this region to enable
encumbrance accounting and to specify the default encumbrance types
Payables assigns to your invoices and Purchasing assigns to your
requisitions and purchase orders. If you enable encumbrance
accounting or budgetary control, Purchasing creates encumbrance
journal entries when you reserve funds for a requisition or purchase
order. If you use the perpetual accrual method in purchasing,
purchasing reverses purchase order encumbrances when you inspect,
accept and deliver the units. If you are using the periodic accrual
method in Purchasing, Payables reserve the purchase order
encumbrances when you create journal entries for invoices. Payables
create encumbrance journal entries when you approve an unmatched
invoice or when there is a variance between a matched invoice and the
purchase order to which it is matched. If you do not use encumbrance
accounting or budgetary control, you do not need to enter defaults in
the Encumbrance region

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Use Requiqision Encumbrance: Enable this option to encumber
funds for requisitions. If you enable this option, Purchasing creates
journal entries and transfers them to General Ledger to encumber
funds for purchase requisitions.

Reserve at (Requisition) Completion: if you enable user

Requisition Encumbrance, indicate whether you want requisition
prepares to have the option to reserve funds. If you don not enable this
option, only requisition approves will have the option to reserve funds.

Use PO Encumbrance: Enable this option to encumber funds for

purchase orders, purchase order matched invoices, and basic invoices
not purchase order matched. If you enable this option, Purchasing
encumber funds for purchase orders and Payables encumbers funds for
variances during Approval for purchase order matched invoices. If you
enable this option and enter a non-purchase order matched invoice,
Payables will encumber funds for it during Approval. All payables
encumbrances are reversed during posting.

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Note: if you enable Use Requisition Encumbrance, you must also
enable this option.

Financial Options - Tax

The options you enter in this region control VAT registration for tax
purposes.

Member State: The location of your company or organization. 

VAT Registration Number: The value added tax (VAT) registration

number for your organization. Your organization assigns a VAT
Registration Number if you register to pay VAT.

Financial Options – Human Resources

Oracle Payables uses the system options and defaults to simplify vendor
entry, invoice entry and automatic payments

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Business Group.  Enter the name of the business group that you want
to associate with Purchasing. If you use Purchasing jointly with Oracle
Human Resources, you must reference the business group that you
define in Oracle Human Resources. If you use Purchasing without
Human Resources, you can use the default value. The default for this
field is the Human Resources default of Setup Business Group.
The business group determines which employees you can use in
Purchasing. In Purchasing, you can see only the employees in this
business group.

Expense Reimbursement Address. 

Select the default address you want to use on

Payments for employee expense reports: Home or Office. The system
uses this default for each new employee you enter. You can override this
default during employee entry or expense report entry.

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Use Approval Hierarchies. 

Enable this option to use positions and position hierarchies to

determine approval paths for your documents within Purchasing.
Disable this option of you want approval paths based on the supervisor
structure.

Employee Numbering Method. You can enter your employee

numbers manually or let the system generate sequential employee
numbers.

Use National Identifier Number: The system automatically enters

the employee’s National Identifier Number as the employee number.
For example, a social security umber for USA employee. The employee
number must be unique if you switch from manual to automatic entry.

Next Automatic Employee Number: If you select the Automatic

Employee numbering method, enter the starting value you want the
system to use for generating unique sequential employee numbers.
After you enter a number and save your changes, the system displays
the number that it will assign to the next new employee you enter.

Define Payment Terms

Oracle Payables uses payment terms to calculate when invoices are due, when and if a
discount is available, and how much to pay an invoice. The payment term can be
defaulted to a supplier.

Navigation: Setup > Invoice > Payment Terms (See Exhibit 7.5)

1. Enter unique Payment Term “Name”

2. Enter the “Description”
3. Enter the “%Due”
4. Enter the no. of days in “Days”, after which the payment is due to the supplier
5. Special calendar that specifies a due date for the period that includes the
invoice terms date.
6. Ensure that total of “% Due” is 100
7. Save

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Exhibit 7.25

Define Payable Options

Payable Options are defined to set control options and defaults used
throughout Payables. Oracle Payables uses the system options and
defaults to simplify vendor entry, invoice entry and automatic
payments. These are payables-specific options which are in addition to
the financial options previously defined.

Prerequisites

 Define your chart of accounts.

 Define your Financials options

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  Define your payment terms

 Define your currencies

 Accounting Methods: Primary Accounting Method, Secondary

Accounting Method

 Payment Accounting: Account for Payment

 Payment Accounting: Account for Gain/Loss

 Payment Accounting: Calculate Gain Loss

 Accounting Methods: Automatic Offset Method

Navigation: Setup>Options>Payables

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In the Accounting Methods Tab:

• Select Primary Accounting Method. Default method is Accrual

creates accounting entries for invoice and payments. If it is Cash
Basis Accounting, accounting entries creates only for payments.
• Set of Books is displayed
• Check the Automatic Offset Method as None, Balancing or
Accounting

Automatic Offset Method. Enable Automatic Offsets by selecting

Balancing or Account as your Offset Method if you want Payables to
automatically create balancing accounting entries for your invoice and
payment transactions.

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 Attention: Carefully consider this option before setting it. Changing
your automatic offset setting after creating accounting entries can result
in slower accounting process performance. Also, under certain
circumstances, changing this setting can result in accounting
irregularities.

 None: Do not use Automatic Offsets. For your invoice

transactions, Payables creates one liability accounting entry, and for
your payment transactions, Payables creates one cash type accounting
entry.

 Balancing: Payables uses the supplier site's default liability

account and overwrites the balancing segment (usually the company
code) with the balancing segment from the expense distribution GL
Account.

 Account: When creating the offsetting liability account,

Payables uses the expense GL Account from the invoice distribution
and overwrites the account segment with the default liability account
from the supplier site.

Discount Method. The method you want Payables to use for

distributing the discounts you take when making payments.

If you leave this field blank, Payables uses the System Account method
for distributing your discounts.

 Prorate Expense. Payables automatically prorates any

discounts across all the invoice distributions. Payables assigns the
discount to the charge account unless the invoice is matched to a
purchase order with Accrue on Receipt enabled, in which case it is
assigned to the price variance account.

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 If your Exclude Tax From Discount Calculation Payables option is
enabled in this window and you enable this option, then the discount is
prorated only to the expense lines and not the tax lines.

 Prorate Tax. Payables automatically prorates a percentage of

the discount amount across the tax distributions. Payables only
prorates the percentage of discount amount equal to the percentage of
your tax distributions. Payables credits the remaining discount amount
to the Discount Taken account you enter in the Financials Options
window.

For example, if your tax distributions are 10 percent of the total invoice
amount, Payables prorates 10 percent of the discount amount across
the tax distributions. Payables credits the remaining 90 percent of the
discount amount to the Discount Taken account.

You cannot select Prorate Tax if your Exclude Tax From Discount
Calculation Payables option is enabled in this window.

 System Account. Payables credits all discounts to the system

Discount Taken account you define in the Financials Options window.

If you enable Automatic Offsets, and you want to have Payables

distribute Discount Taken amounts across balancing segments, choose
this method.

If you enable the Use Bank Charges option in the payment region, the
Discount Distribution Method defaults to System Account and you
cannot update it.

Currency Tab

Oracle Payables uses the currency information for processing foreign currency
invoices

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Use Multiple Currencies: Enable this option if you want to enter and pay invoices in a currency
different from your ledger currency. Payables also allows you to define a multiple currency payment
format and bank account if you enable this option.

If you update this Payables option from enabled to disabled, Payables checks and warns you if you have
any multiple currency bank accounts that are using multiple currency payment formats. You must
inactivate the payment documents that use multiple currency payment formats and change the Multiple
Currency field value on multiple currency bank accounts to disabled before you can change this Payables
option from enabled to disabled.

Require Exchange Rate Entry. Enable this option to require entry of

an exchange rate whenever you enter an invoice or a payment in a
currency other than your ledger currency or an associated fixed rate
currency. If you maintain daily rates in the Daily Rates window,
Payables defaults the rate automatically, based on the date and the
Rate type you enter. If the exchange rate type is User, then Payables

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always requires an exchange rate, either entered by the user or
calculated by the system.

You cannot create accounting entries for or pay foreign currency

invoices without exchange rates. After you have entered invoices or
created payments, you can enter exchange rates, either manually, or
by using the AutoRate program.

When you create bills payable, you are required to enter the Maturity
Rate, Maturity Rate Type, and Maturity Rate Date.

Calculate User Exchange Rate. If you already know the ledger

currency amounts of any foreign currency invoices you are entering,
then you can enable this option so Payables can calculate and enter
effective invoice exchange rates for those invoices.

This functionality applies to invoices you enter in the Invoices window

and invoices you import from the Payables Open Interface Import
program. If this option is enabled, then when you enter a foreign
currency invoice, if you select the exchange rate type of User and you
provide the ledger currency amount, then Payables calculates and
enters the exchange rate.

Payables allows you to enter a value for ledger currency amount in the
Invoices window only if this option is enabled.

If this option is enabled then when you enter a foreign currency invoice,
you still have the option of entering a foreign currency invoice amount
and exchange rate so Payables will calculate and enter the ledger
currency amount.

A new option Use Invoice Exchange Rate for Prepayment

Application Tax Line is added. This checkbox is not selected by
default. If you select this option, then on prepayment the functional
amount for tax associated with Prepayment is calculated using the
exchange rate specified on the Standard Invoice. If this option is not
selected, then on prepayment the functional amount for tax associated

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with Prepayment is calculated using the exchange rate specified on the
Prepayment Invoice. If you change the option at any time, the
prepayemnts already applied are not impacted.

Exchange Rate Type. Payables uses this as the default exchange rate
type when you enter invoices or create payments. See: Types of
Exchange Rates.

Realized Gain/Loss. Payables uses these accounts as the default

realized gain and loss accounts for payments from each of your bank
accounts. If the exchange rate changes between invoice entry and
payment, Payables automatically calculates the realized gain or loss
and records it in this account. Payables records gains and losses only if
you use accrual basis accounting. The Account for Gain/Loss Payables
option controls when Payables accounts for gains and losses.

Rounding. Payables uses this account for currency rounding at the

following times:

 You use multiple currencies and the payment currency does not
round within the payment currency precision. For example, if a
payment rounds to 100.001 GBP, the payment will be for 100.00
GBP, and the rounding error of .001 will be recorded in this
account.

 The ledger currency amounts of payments do not equal the

amount recorded as the liability. The system charges the
remaining amount to the rounding account to fully relieve liability.
This happens when you make the final payment of an invoice
that is already partially paid.

 You have enabled automatic offsets and the cash account is

pooled, and you have rounding errors. The system charges the
remaining amount to the rounding account to fully relieve the
cash clearing account. This happens when you make the final
payment of an invoice that is already partially paid.

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Press Transfer to GL Tab:

Oracle Payables uses the posting information to control the transfer of invoice and
payment information to the general ledger for posting (See Exhibit 7.13)

1. Select Transfer to GL Interface option Summarize by Accounting Period

to create summary journal entries by period
2. Check the Submit Journal Import box to run Journal Import after
successful completion of Journal creation.

Exhibit 7.13

Payment Accounting Tab:

The payment accounting options/defaults have been set as follows (See Exhibit 7.14)

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Exhibit 7.14

Oracle Financials R12 46

Exhibit 7.15

Payment Supplier Tab:

Oracle Payables uses the vendor defaults when you enter new vendors. (See Exhibit
7.16)

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Exhibit 7.16

Payment Invoice Tab:

Oracle Payables uses the invoice information to control the entry and approval of
invoices (See Exhibit 7.17)

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Exhibit 7.17

Matching Tab:

Oracle Payables uses the matching information when you match invoices to purchase
orders. (See Exhibit 7.18)

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Exhibit 7.18

Interest Tab:

Oracle Payables uses the payment interest information to automatically create interest
invoices when you pay vendor invoices late. (See Exhibit 7.19)

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Exhibit 7.19

Expense Report Tab: (See Exhibit 7.20)

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Exhibit 7.20

Payment Tab:

Oracle Payables uses the payment information to determine the default bank account
and payment cycle when you create payments, and to control on-line printing, future-
dating and pre-dating of payment documents. (See Exhibit 7.21)

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Exhibit 7.21

Invoice Tax Tab:

Oracle Payables uses the invoice tax information to control the calculation of taxes
during invoice entry and approval. (See Exhibit 7.22)

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Exhibit 7.22

Withholding Tax Tab: (See Exhibit 7.23)

Oracle Financials R12 54

Exhibit 7.23

Define Lookup Codes

A lookup is any predefined value that was not defined in a setup
window. Lookups in Oracle are a collection of values. Lookups are a
static collection of codes which are used by Oracle for working. The
main purpose of a lookup is to keep programs, flexible and easier to
configure. Lookups are an approach of creating a configurable “list of
values” in E-Business Suite. Maintain existing and define additional
Lookups for your shared Lookup types.

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You can define up to 250 Lookups for each Lookup type. Each Lookup
has a code and a meaning. For example, Lookup type YES_NO has a
code Y with meaning Yes, and a code N with a meaning No

Lookups Block:

Below are the Lookups Block:

Type: Query the type of your Lookup. You can define a maximum of
250 Lookups for a single type.

Meaning: Mention meaningful value for Meaning

Application: Query the application associated with your Lookup type.

Description: If you use windows specialized for a particular Lookup

type, the window uses this description in the window title.

Access Level: This option group provides functionality for a later

release. The value System indicates that the Lookup type was seed data
provided by an Oracle Application. (Mentioned below the types of
lookups)

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Shared: This field provides functionality for a later release.

Types of Lookups (Access Level)

User:
User Defined lookups are client specific which are created to meet the
business specific customization s. These are created by the users and
the users can add new values and disable the older ones.

 Deletion of codes is allowed

 Updating of tag is allowed
 Insertion of new codes is allowed
 Updating of start date, end date, and enabled fields is allowed

Extensible:
These are system provided lookups. Users can add their values if they
want, but Seeded values by Oracle cannot be changed. In simple words:

 Updating of module is not allowed

 Updating of start date, end date, enabled fields, and tag is allowed
only if the code is not ‘seed data
 Deletion of lookup type is not allowed
 Insertion of new codes is allowed
 Deletion of codes is allowed only if the code is not ‘seed data’

System:
These are lookups which are used internally by the system. Users can
see and use the lookup, but they cannot disable the existing values or
add new values. Simply you can understand:

 Deletion of codes is not allowed

 Updating of tag is not allowed
 Updating of module is not allowed
 Deletion of lookup type is not allowed
 Insertion of new codes is not allowed
 Updating of start date, end date, and enabled fields is not allowed

Oracle Financials R12 57

Lookups Values Block

Language: Sometimes, you may have several Lookups with the same
Code in different languages those are need to understand. For example,
the code Y may have a meaning of Yes in American English and Oui in
French. Oracle Applications displays the correct meaning depending on
your Site Language.

Code: You can enter the code value for your Lookup. But you can
define a maximum of 250 Lookups for a single Lookup type. When you
enter, a valid Lookup meaning into a displayed window field, Lookups
stores this code into a relevant hidden field. For example, the Lookup
“Y” displays the meaning “Yes” but stores the code value “Y” in a hidden
field.
Note: You cannot change the values in this field after committing them.
You can’t remove the Lookup, those Lookup which you don’t want to
use, you can either disable the code, enter an end date, or change the
meaning and description to match a replacement code.

Start Date / End Date: It will set the Date range in which your
Lookup will be active. Enter the dates between which this Lookup
becomes active. If you do not enter a start date, your Lookup is valid
immediately.
When a Lookup expires, users cannot insert additional records using
the Lookup, but can query records that already use the Lookup. If you
do not enter an end date, your Lookup is valid indefinitely.

Description: You can enter description, if you want to display the

description along with the meaning to give more information about
your Lookup.

Meaning: When you want to enter, a valid Lookup meaning into a

displayed window field, Lookups stores the relevant code into a hidden
field. Lookups automatically displays the meaning in your Lookups
field whenever you query your window. For example, the Lookup “Y”
displays the meaning “Yes” but stores the code value “Y” in a hidden
field.

Oracle Financials R12 58

Enabled: It will indicate whether applications can use your Lookup or
not. If you enter No, users cannot insert additional records using your
Lookup, but can query records that already use this Lookup.

Sign “[ ]” The double brackets ([ ]) identify a descriptive flexfield that

you can use to add data fields to this window without programming

There are three Lookup available in Payables:

 Payables
 Employee
 Purchasing

Purchasing Lookups

Setups>Lookups>Purchasing

In Oracle Purchasing Lookups window. You can add values for the
following lookups that Payables uses:

Oracle Financials R12 59

 Supplier default for all new purchase orders. See: Entering
Supplier Information.
 Freight Terms: Supplier default for all new purchase orders.
 Minority Group: Supplier classification for reporting
purposes.
 Pay Group: Groups invoices in payment batches.
 Supplier Type: Supplier classification for reporting purposes.
You can enter this value in the Type field of the Classification region of
the Suppliers window. This value cannot exceed 25 characters or you
will not be able to see it in the Suppliers window.

Payables Lookups
You can add values for the following lookup types in this window:
Setup>Lookups>Payables
 AWT Certificate [Link] withholding tax certificates. It
is the Payables predefines the Standard lookup name.
 AWT Rate [Link] Withholding Tax type tax codes.
These are the Payables predefines: Certificate, Exception, Penalty, and
Standard lookup names.

Note: Oracle Payables uses only the Standard AWT Rate Type. If you
want to use an AWT Rate Type other than Standard, you may want to
customize Automatic Withholding Tax to perform a special behavior
based on the AWT Rate Type.
 Bank Branch Type. Payables predefines the following Bank
Branch values that you enter in the Banks window: ABA, CHIPS,
OTHER, SWIFT.

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 Card Brand. Used in the Credit Card Programs window.
Payables includes four card brands: American Express, Diner’s Club,
MasterCard, and Visa.
 Date Mask. (This value is no longer used).
 Disbursement [Link] when you define your payment
documents in the Manage Payment Documents page accessed from the
Banks Accounts page. Payables predefines three disbursement type
values: Combined, Computer Generated, and Recorded.
 Don’t Pay [Link] in the Modify Payment Batch window
when you remove all invoices for a supplier site from a payment batch.
 EDI Payment [Link] predefines the following
lookup names: CCD, CCP, CTP, CTX, PPD, PPP.
 EDI Payment [Link] predefines the following
lookup names: ACH, BACS, BOP, FEW, FWT, SWT, ZZZ.
 EDI Remittance [Link] predefines the following
lookup names: Do not route, EDI to Third party, EDI to payee, EDI to
payee’s bank, EDI to payer’s bank.
 EDI Transaction [Link] predefines the following
lookup names: C, D, I, U, Z.
 Used when you enter the source of invoices you want to import.
 Tax [Link] to define tax codes. Payables uses four
predefined tax type values: Sales, Use, Offset, and Withholding Tax.

Navigation: Setup>Lookups>Purchasing

Lookups Window will be appeared

Oracle Financials R12 61

Press F11 and Query by the type : PAY GROUP and

Press CTRL F11

Oracle Financials R12 62

Enter the Code, Meaning, Description, From Date and Enabled as
shown in the example.

Enter Code, meaning, description fields

You can enable the descriptive Flexfields on these lookups

Define Distribution Sets

Distribution Sets are used to automatically enter distributions for an
invoice that will not be matched to a purchase order. Expenses, which
are not P.O. based and are commonly allocated across several expense
accounts, would be good candidates. Common examples would be
building rent, shared non-capitalized leasing equipment, and utilities.
You can assign a default Distribution Set to a supplier site so that

Oracle Financials R12 63

Payables will use it for invoices for that site or assign a Distribution set
during the invoice entry process. Be sure to provide a name for your
set, which will accurately characterize what it is used for. It is a good
idea to include in the name, whether it is 100% full or a skeleton.

Remember! 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: Distributions created by distribution sets are always exclusive of

tax even if you use Automatic Tax Calculation and you have checked the
Includes Tax check box at the supplier site.

There are 3 types of distribution sets used in Oracle Payables:

 Full
 Skeleton
 Project Related

Full: We can use Full distribution set where each line represents a
percent of the total invoice amount and when the distribution line is
created it will provide the account and amount in the distributions
window. The percentages for all lines must total 100%.

For example, a Full Distribution Set for a rent invoice assigns 75% of
the invoice amount to the Production department expense account and
25% to the Admin Department expense account.

Skeleton: Skeleton distribution set is used where each line is

reproduced in the distributions window with the account information
but without amounts. All lines must be 0%. A Skeleton Distribution
Set for the same invoice would create one distribution for the
Production department expense account and one distribution for the
Admin Department expense account, with the amounts zero. You could
then enter amount during invoice entry depending on variables such as
that month’s headcount for each group.

Oracle Financials R12 64

Project Related Distribution Set: If you have Oracle Projects
installed, you can associate a distribution with a project by entering
project information on invoice distributions. The system uses the
project information to build the distribution accounts. If you use a
project related distribution set, Payables automatically enter the project
information on the distribution for you. You can override the project
fields on the distribution. The system will then create accounts based
on the new information.

Note: Prerequisite for Project Related Distribution Set is Oracle

Projects should be installed.

Navigation: Setups > Invoice > Distribution Sets

1. Enter the Distribution Set “Name”.

2. You cannot Select the Type of the Distribution Set , Once you
Save your work. Payables automatically assigns type Full to your
Distribution Set.
3. Enter the “Description”.

Oracle Financials R12 65

 4. Type by default will be grayed out before save.
5. 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.
6. Ensure that the total allocation is 100 % or nil for all the
distributions together.

7. If its project Related, check ‘Project Related’. It Will prompt

anothew window to enter Project Information

8. Click on OK
9. If you are creating a Distribution Set for a federally reportable
supplier, optionally enter an Income Tax Type.
10. You can an enter an Invoice Tax Name Optionally. The Tax
Name will default based on the Tax Name 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.

Oracle Financials R12 66

 11. After Save. Payables automatically assign type Full to your
Distribution Set. You can see highlighted.
12. If you want to inactive after specific date, then you can enter that
date in Inactive On field.

Full Distributions Set

Skeleton Distribution Set

1. 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.

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 3. After Save. Payables automatically assign type Skeleton to your
Distribution Set. You can see highlighted.

4. If you want to inactive after specific date, then you can enter that
date in Inactive On

Project Related Distribution Set

1. Enter either a Skeleton or Full Distribution Set in the

Distribution Sets window.
2. If a distribution is project related, check Project Related.

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 Note: Prerequisite for Project Related Distribution Set is Oracle
Projects should be installed.

3. Click on ‘Project Information’ button

4. Enter the Project details
5. Enter the Task
6. Enter the Expenditure type
7. Enter the Organization
8. Click OK
9. Save

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Define Special Calendars
Define Special Calendar to define periods for automatic withholdingtax, payment
terms, recurring invoices and Key Indicators Report.

Navigation: Setup>Accounting>Special Calendar

1. Select Type of Calendar. There are 4 types available Recurring Invoice,

Withholding Tax, Payment Terms and Key Indicator (See Exhibit 7.24)
2. Enter Calendar Name
3. Enter Description
4. Enter number of periods per year.
5. Enter Period Name
6. Enter Year
7. Enter sequence to indicate the order of the periods.
8. Enter From Date and To Date
9. Enter the Due Date for payment terms calendar that defined the date on
which invoices become due.
10. Payables displays the System Name

Exhibit 7.24

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Signing Limits
Define the Signing Limits to the Managers to approve expense report if the total
amount of the expense report does not exceed their signing limit.

Navigation: Employees>Signing Limits (See Exhibit 7.26)

1. Select AP Expense Report.

2. Select the name of the manager from the list of values.
3. Enter the cost center.
4. Enter the signing limit for this manager.
5. Save

Exhibit 7.26

Invoice Tolerances
Payables checks that the invoice matches the purchase order or receipt within the
purchase order matching tolerances you define. Tolerances determine whether
Payables places matching or tax holds on an invoice.

Navigation: Setup>Invoice>Tolerances

Select the check box for each tolerance to enforce (See Exhibit 7.27)

1. PO Matching: Apply to any Purchase Order

2. Maximum Quantity Ordered: Quantity billed against quantity ordered
3. Maximum Quantity Received : Quantity billed against quantity received
4. Price:
5. Exchange rate amount
6. Shipment Amount

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 7. Total Amount

Exhibit 7.27

Invoice Hold and Release Names

Invoices can automatically be placed on hold by several methods: by failure to
comply with preset tolerances, as in the method described above; by entry of
the invoice before a required receipt of the goods; or because the supplier is
on hold prior to the entry of the invoice. Invoices also can be placed on hold
manually by an authorized user. Invoice holds may be removed either
manually, by an authorized user, or by an automatic process.

The following table shows the release names that are predefined in Payables. (See
Exhibit 7.28)
1. Enter unique Name and Reason to identify Hold or Release Name
2. Enter Type of name from the List of Values
3. Select Accounting Allowed to allow payables to create accounting entries for
invoices for which hold applied.
4. Select Manual Release Allowed to release holds manually.

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Exhibit 7.28

Hold Types (See Exhibit 7.29)

Exhibit 7.29

Interest Rates

Define Interest Rates that Payables use to calculate and pay interest.

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Navigation: Setup>Payments>Interest Rates (See Exhibit 7.30)

1. Enter Interest rate in % field

2. Enter Start Date and end dates for the interest rate
3. Save

Exhibit 7.30

Define Banks
In order to make payments against Payables Documents you must set up a bank.
Bank definitions are shared between Receivables and Payables. Individual branches
can have multiple accounts, and each account which is defined can be associated with
Payables documents and/or Receivables payment methods.

Both applications allow internal banks and external banks to be defined. On the
Receivables side identify internal banks which you use for receipts as well as external
banks which belong to your customers that you have direct banking relations with. In
Payables define the internal bank accounts which you use to disburse payments and
you can additionally define payment documents for checks, electronic payments (EFT
and EDI), wire transfers, and other payment methods. It is also possible to enter
supplier bank information for suppliers that you send payments to electronically.

After opening the form there will be 3 distinct regions: Address; Contact; and Clearing
House.

Navigation: Setup > Payment > Banks

(See Exhibit 7.31)

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 1. Bank Name Ensure that the bank is not existing in the database
2. Enter the “Bank Name”
3. Enter the “Bank Number”
4. Enter the “Bank Branch Name”
5. Enter the “Bank Branch Number”
6. Select Type, there are 4 types
ABA: American Banking Association
CHIPS: Clearing House Interbank Payment System
Other: Other Bank Type
SWIFT: Society for Worldwide Interbank Financial Telecommunications
7. Select Bank from the Institution
8. Enter the “Description”
9. Optionally load electronic funds transfer in EFT
10. Select the Country
11. If the bank is shared between Payables and Receivables, and if it provides
Clearing House functions then enter the required information in the Clearing
House region:
Clearing House: Enter
Branch: Enter

12. Click on “Bank Accounts”

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Exhibit 7.31

Enter Bank Information in Bank Accounts (See Exhibit 7.32)

1. Enter the “Bank Account Name”

2. Select the “Account Use” as “Internal”
3. Enter the bank account number
4. Select the “Currency “
5. Enter the account code combination for the following in the GL Accounts
region:
a. Bank account (Field name “Cash”)
b. Confirmed Receipts
c. Future Dated Payment
d. Click on “Receivables Options”

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Exhibit 7.32

6. Enable “Multi Currency Payments” option (See Exhibit 7.33)

7. Enter the account code combination for “Realized Gain” & “Realized Loss”
8. Click on “Payable Documents”

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Exhibit 7.33

9. Enter the “Document Name” (See Exhibit 7.34)

10. Enter the “Document Name” as Check <cheque series starting number> &
<cheque series ending number>
11. Select the “Disbursement Type” as “Combined”
12. Select the “Payment Format” “from LOV
13. Click on “Additional Information”
14. Enter the “Last Used” check series number i.e., starting cheque series number
less one
15. Enter the “Last Available” series number i.e, last cheque number
16. Save

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Exhibit 7.34

Additional Information (See Exhibit 7.35)

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Exhibit 7.35

Define Supplier Banks

Click ‘New’ from the Bank Accounts window to create Supplier Bank for the Same
Bank.
(See Exhibit 7.36)

1. Enter the Supplier name as “Bank Account” name

2. Select the “Account Use” as “Supplier”
3. Enter the Bank Account no.
4. Select the “Currency”
5. Click on “Account Holder”

Exhibit 7.36

Click on “Supplier Assignments” tab (See Exhibit 7.37)

1. Select the supplier

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 2. Click on “Primary”
3. Save
4. Press down arrow key
5. Select the same supplier as above
6. Select the supplier site
7. Click on Primary
8. Save

Exhibit 7.37

Define Tax Codes

If you want to mention default tax code in financial options, define tax codes now.

Navigation: Setups>Tax>Codes (See Exhibit 7.38)

1. Enter Tax code

2. Select Tax Type
3. Enter the Rate
4. Enter the description
5. Optionally select Offset Tax code

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 6. GL Account
7. Save

Exhibit 7.38

See the details in Other tab (See Exhibit 7.39)

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 Exhibit 7.39

Define Tax Groups

Define Tax Groups to group tax codes to apply multiple tax codes to a single taxable
item

Navigation: Setup>Tax>Tax Groups

(See Exhibit 7.40)

1. Enter Tax Group code

2. Enter Effective date that tax group to be effective.
3. Enter description
4. Enabled check box and Input option are automatically selected.
5. Enter Tax Code, Tax Rate, Recovery Rule Name, Offset Tax Code
6. Save

Oracle Financials R12 83

Exhibit 7.40

Payment Formats
Payables provide numerous formats for six Payment Formats available to instruct
printing mechanisms or devices where to store information on the payment
document. You can define as many payment formats as you require for each payment
method

Navigation: Setup>Payment>Formats

(See Exhibit 7.41)

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Exhibit 7.41

1. Enter the Payment Format name in the Payment Format

2. Select the type of Payment Method
3. Select either Single or Multiple Currency
4. Specify the payment format to print Remittance advice
5. Choose Build Payments Program
6. Choose Format Payments Program
7. Save

Create Employee Expense Report

Define Expense Report Template to define templates based on the expense report
forms you regularly use in your enterprise

Oracle Financials R12 85

Navigation: Setup>Invoice>Expense Report Templates

(See Exhibit 7.42)

1. Enter Name and Description of the Expense Report Template

2. Enter Inactive date on which this template no longer be used
3. Check ‘Enable for Internet Expense’ box available for use of internet
4. Enter Name of an expense item as it appears on expense report
5. Choose Expense category if you enable ‘Enable for Internet Expense’ only or
accept the default category ‘Miscellaneous’
6. Select Item Type Item, Freight, Miscellaneous, Tax
7. For Internet Expenses you can enter credit card transactions on their expense
reports by selecting Card Expense Type.
8. You can enable the Includes Tax check box only if Automatic Tax Calculation
is enabled.

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Exhibit 7.42

Click on Assign Card Expenses Types to select card expense type and press OK (See
Exhibit 7.43)

Exhibit 7.43

9. Enter the GL Account (See Exhibit 7.44)

10. Enter the Prompt to display on the expense report
11. Enable ‘Viewable from All Templates’ to appear on every internet expenses
enabled templates
12. Select Require Receipt for
13. Check Calculate Amount check box if Descriptive Flexfield values defined for
this expense type.
14. Select ‘Justification Required’ option

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Exhibit 7.44

15. Use the Itemizations window to define itemization behaviour for an expense
item.
(See Exhibit 7.45)
16. Click OK
17. Save

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Exhibit 7.45

Define Aging Periods

Define Aging Periods to define time periods for the Invoice Aging Report. This report
provides information about invoice payments due during four periods specified by
displaying information in four columns; each column corresponds to one period.

Navigation: Setups>Calendar>Aging Periods

1. Enter the Name and Description of Aging Period (See Exhibit 7.46)
2. Choose Active to activate this aging period
3. Enter the Column Order
4. Enter range of days for the period
5. Enter the First and Second lines for Column Heading

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Exhibit 7.46

Accounting Periods

Enter transactions in open accounting period. There are four statuses in Payables are
Never Opened, Future, Open, Closed and Permanently Closed. Transactions never
created in a closed period. One period should be open at a time.

Navigation: Accounting>Control Payables Periods

(See Exhibit 7.47)

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Exhibit 7.47

Define Suppliers

Define suppliers to record information about companies and individuals from whom
you purchase goods and services. Supplier records have two components, Supplier
record and supplier site record. Enter supplier name, and type of supplier in Supplier
header. Enter address data in supplier site. When you define Supplier, enter header
information only once, and enter supplier sites for each location. Unlimited supplier
sites can be created for a supplier. After you define suppliers, you can use them when
you import/enter invoices.

Navigation: Suppliers > Entry

Entering basic supplier header information

(See Exhibit 7.48)

1. Ensure that the supplier is not existing in the database

2. Enter Supplier Name

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 3. Number Manually enter supplier name or automatically
4. Optionally enter an Alternate name, Tax payer id, Tax registration number,

General Region

5. Parent supplier name,

6. customer number if exists

Exhibit 7.48

Classification Region

Enter Supplier type in Type field under (See Exhibit 7.49)

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Exhibit 7.49

Enter Supplier Site Details (See Exhibit 7.50)

1. Save the record and Click on Sites [System Generates

Supplier Number ]
2. Enter Supplier Site Name
3. Enter Supplier Address information
4. Enter Supplier Contact details under Contacts TAB
5. Optionally enter details under Payments TABs
6. Enter Supplier Bank Account details & click on “Primary”
under Bank Accounts TAB
7. Save the record

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Exhibit 7.50

Contacts tab (See Exhibit 7.51)

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Exhibit 7.51

Accounting Tab (See Exhibit 7.52)

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Exhibit 7.52

Control Tab (See Exhibit 7.53)

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Exhibit 7.53

Payment Tab (See Exhibit 7.54)

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Exhibit 7.54

Bank Accounts Tab (See Exhibit 7.55)

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Exhibit 7.55

Invoice Tax Tab (See Exhibit 7.56)

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Exhibit 7.56

Invoices
Invoices received from the supplier may be directly entered into Oracle
Payables. Organizations require the flexibility to pay supplier invoices Ides.
An invoice cannot be automatically approved if it does not meet basic user-
defined internal controls. Users must have the ability to maintain unpaid
invoices, correct data entry errors and make changes to payment schedules
for special requirements, e.g., cancellation of an invoice for defective goods
returned to a supplier.

Invoice processing needs by providing features for:

 Entering and approving supplier invoices;
 Matching invoices to purchase orders and, optionally, to receipts;
 Managing invoice holds; and
 Maintaining invoices.

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 Standard Invoice
Invoices > Entry > Invoice Batches

(See Exhibit 7.57)

1. Enter Name of the Invoice Batch
2. Enter Control Count and Amount for the Batch
3. Optionally Select Invoice currency, Payment Terms and Pay Group from List
of Values
4. Save the record and Click on Invoices Button

Exhibit 7.57

5. Select Invoice type as standard from List of Values (Default Value: Standard)
(See Exhibit 7.58)
6. Select Supplier Name from List of Values
7. Select Invoice Date from List of Values
8. Enter Invoice number and Invoice amount

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Exhibit 7.58

9. GL Date, payment Currency, Payment Rate date automatically updated. (See Exhibit
7.59)

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Exhibit 7.59

10. Optionally select Payment Terms and Terms date (See Exhibit 7.60)

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Exhibit 7.60

11. Save the record and Click on Distributions button (See Exhibit 7.61)

12. Enter Line amount

13. Select Account Code Combination from List of Values
14. Optionally Enter Description (This description will be defaulted as Asset
description for Invoices relating to purchase of Fixed assets
15. Save the record

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Exhibit 7.61

Invoice Approval (Validation)

Invoices > Entry > Invoice Batches > View > Find

1. Select Invoice Batch/Batches for which validation has to be performed and

Click on find
2. Click on ‘Validation 1’ (See Exhibit 7.62)

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Exhibit 7.62

3. Click on OK for the Caution (See Exhibit 7.63)

Exhibit 7.63

4. Click OK for the Note (See Exhibit 7.64)

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Exhibit 7.64

5. This action will submit a concurrent program for validating selected Invoice
Batch. View the output and make sure that no holds are placed. (See Exhibit
7.65)

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Exhibit 7.65

6. Query the Invoice Status is ‘Validated’ (See Exhibit 7.66)

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Exhibit 7.66

7. Click ‘Actions’ button and check ‘Initiate Approval’ to approve Invoice and
check
‘Create Accounting’ (See Exhibit 7.67)
Note: This action can be performed by running ‘Payables Accounting Process’
concurrent program as well for the invoices either individually or globally at
the end of day for all

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Exhibit 7.66

8. Invoice Approval Status is ‘Approved’ and Accounted. (See Exhibit 7.67)

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Exhibit 7.67

Invoice Accounting

From the Tools menu, Click on ‘View Accounting’ (See Exhibit 7.68)

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Exhibit 7.68

Payment Accounting

Click on View Payments and From the Tools menu, Click on ‘View Accounting’ (See
Exhibit 7.69)

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Credit Memo
A credit memo is recorded in the system whenever a credit memo is received from a
supplier, being rectification of original invoice. Credit memos entered against an
invoice, or they can be applied against a supplier’s account in total. If they are entered
referencing only the supplier, the adjustment amount is reflected in payment
processing. Items purchased may be returned can be shown as credit memo
transaction. Credit memo or debit memo can be generated in payables. They are
entered as a negative invoice. This should be applied to original invoice and netted
with invoices during payment process. The credit memo entry is the same as the
invoice entry since it is another type of invoice.

Navigation: Invoices > Entry > Invoice Batches

(See Exhibit 7.70)

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 1. Enter Name of the Invoice Batch
2. Optionally Enter Control Count and Amount for the Batch
3. Optionally Select Invoice currency, Payment Terms and Pay Group from List
of Values
4. Save the record and Click on Invoices Button

5. Select Invoice type as Credit Memo from List of Values (Default Value:
Standard) (See Exhibit 7.71)

6. Select Supplier Name from List of Values

7. Select Invoice Date from List of Values
8. Enter Invoice number and Invoice amount
9. Match this credit memo to the Invoice by choosing ‘Invoice’ and clicking on
‘Match’

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 10. Click on ‘Match’ for the Decision (See Exhibit 7.71)

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 11. Find Invoices for Matching window opens, select the Invoice Number for
which this Credit Memo to be applied. Click on ‘Find’ (See Exhibit 7.72)

12. Check on ‘Match’ and enter the negative amount for Credit Amount and click
on ‘Match’ (See Exhibit 7.74)

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 13. Click OK for the Note (See Exhibit 7.75)

14. Save the record and Click on Distributions button (See Exhibit 7.76)
15. Enter Line amount
16. Select Account Code Combination from List of Values
17. Optionally Enter Description (This description will be defaulted as Asset
description for Invoices relating to purchase of Fixed assets
18. Save the record

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 19. From the Actions, Validate and create Account for the credit memo.

Prepayment Invoices
Prepayments are advances against future invoices to employee or supplier. These
advances are applied to expense report or invoice (Prepayment Invoice).

Invoices > Entry > Invoice Batches

Select/Create the invoice batch (See Exhibit 7.77)

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 1. Select Invoice type as “Prepayment” (See Exhibit 7.78)
2. Select Supplier Name from List of Values
3. Select Invoice Date from List of Values
4. Enter Invoice number and Invoice amount

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 5. Click on “Distributions” (See Exhibit 7.79)
6. Enter Line amount
7. Select Account Code Combination from List of Values
8. Optionally Enter Description (This description will be
defaulted as Asset description for Invoices relating to
purchase of Fixed assets
9. Save the record

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 10. Click on Actions…1 button (See Exhibit 7.79)
11. Check ‘Validate’
12. Press OK.
13. Invoice status will change to ‘Validated’
14. Click on Actions…1 button
15. Check ‘Pay in Full’ for quick payment and ‘Create Accounting’
16. Click OK

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 17. Select Bank (See Exhibit 7.80)
18. Select Document

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 19. Save
20. Click OK on the Note (See Exhibit 7.81)

21. Click on Actions

22. Select ‘Format’, ‘Print Now’, ‘Create Accounting’, ‘Print CPV’
23. Click OK

Advance adjustment to Invoice

Navigation: Invoices > Entry > Invoice Batches

(See Exhibit 7.82)

1. Select the invoice batch

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 2. Query the “Prepayment” invoice

3. Click on “Actions” (See Exhibit 7.83)

4. Select “Apply/Unapply Prepayment”

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 5. Select invoice to which this prepayment invoice to be
associated & click on “Apply” (See Exhibit 7.84)
6. Save

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Navigation: Invoices > Entry > Invoice Batches

1. Select the invoice batch

2. Query the “Standard ” invoice to which Prepayment invoice
has been associated
3. Amount Prepayment details are displayed in View Payments

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 4. In the View Prepayment Applications, the prepayment details
will be displayed. (See Exhibit 7.86)

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Click on Distributions button (See Exhibit 7.87)

5. Verify the Line amounts

6. Another line for Prepayment has been created for this invoice

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Matching to Purchasing
Match the invoice to Purchase Order.

Invoices > Entry > Invoice Batches

Create invoice batch like before

1. Select Invoice type as PO Number from List of Values (See Exhibit 7.88)

2. Enter PO Number in ‘PO Number’ and press OK

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 3. Select Supplier Name from List of Values (See Exhibit 7.89)

4. Select Invoice Date from List of Values

5. Enter Invoice number and Invoice amount

6. Invoice Type defaulted to Standard.

(See Exhibit 7.90)

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 7. Click on‘ button to match this invoice to purchase order
8. Click ‘Find’ (See Exhibit 7.91)

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 9. Click ok on Note
10. Check ‘Match’ box to select the Qty Invoiced and enter Match Amount (See
Exhibit 7.92)
11. Click on ‘Match’

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 12. Invoice has been created. (See Exhibit 7.93)

13. Follow the standard procedures to validate, create accounting, payment etc.,

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Maintain Invoices
Release Holds

All holds must be released from an invoice, either manually or through AutoApproval,
before it can be paid. Releasing a hold manually is shown below

Invoices>Invoice

A Standard invoice has been created but went on hold. (See Exhibit 7.94)

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Press Holds tab

See the hold and reason: (See Exhibit 7.95)

 Hold Name : Qty Ord

 Hold Reason: Quantity billed exceeds

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Click on Actions...1

Check ‘Release Holds (See Exhibit 7.96)

Select Hold Name from the list of values

Enter the Release Name
Click OK

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Hold released. This invoice needs revalidation. (See Exhibit 7.97)

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Reverse invoice Distribution

We can correct the invoice distribution in two ways.

 Delete the original invoice distribution if it has not been posted to General
Ledger and enter new distribution with correct details.
 Reverse the invoice distribution if it has been posted to General Ledger and
enter the new distribution with correct details.

1. Find below invoice distribution which has been posted to General Ledger
(See Exhibit 7.98)

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Exhibit 7.98

2. Click on Reverse 1 (See Exhibit 7.99)

3. Click OK on Caution

4. System reverse the original distribution (See Exhibit 7.100)

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 5. Enter the new distribution line with correct details (See Exhibit 7.101)
6. Save your work.

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Change scheduled payments

We can change the Scheduled Payments to make urgent payment. Modify the invoice
due date calculated by default.

1. Query the invoice (See Exhibit 7.102)

2. View Scheduled Payments

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 3. Change the Due Date by selecting date from the Calendar (See Exhibit 7.103)

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Payments
Organizations require the ability to make payments to suppliers for goods acquired
and services received. Such payments should be generated for invoices received and
approved, based on the organization’s procedures and controls.

Automatic Payments
Payments > Entry > Payment Batches

1. Enter Batch Name (See Exhibit 7.104)

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 2. Select Bank account from which the Payment has to be effected

3. Enter Pay group

4. Select the Bank Account
5. Select the Document “Check” from LOV
6. Optionally, change the “Pay Through Date”

7. Save the record and Click on Actions Button (See Exhibit 7.106)
8. In Payment Batch Actions window ensure Select Invoices and Build Payments
check boxes are enabled

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 9. Click Ok [This action will submit a concurrent request] (See Exhibit 7.107)

10. Click on “Requery Batch” to update the Status (See Exhibit 7.108)
11. Payment status has been changed to Selected

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Review Payment

12. Check that status changed to “Built” (See Exhibit 7.109)

13. Click on “Payments” to review & make changes
14. Optionally enter the “Bank Charges” to be recovered from supplier

Format Payment Batches

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 15. Click on “Actions” (See Exhibit 7.110)
16. Check that “Format Payments” is checked
17. Click on “OK”

18. Click on “Requery Batch” to update the Status (See Exhibit 7.111)
19. Payment Status has been changed to Formatted

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Confirm Payment Batches

20. Click on Actions. (See Exhibit 7.112)

21. Select “Confirm Payment Batch and Print Final Register”,
22. Select Printer
23. In the Confirm Payment Batch window, enter the document number ranges of
the successfully printed and select status Printed.
24. Choose Confirm.

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 25. Click on “Requery Batch” to update the Status (See Exhibit 7.113)

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Print CPV

26. Click on Actions (See Exhibit 7.114)

27. Select “Create Accounting”
28. Select “Print Final Register”
29. Select “Print CPV Actions.
30. Click on “OK”

Quick Payments/Manual Payments

Payments can be done on two ways either QuickCheck or Manual. Default payment
method is QuickCheck, select Manual to enter payments already processed. Quick
Payments can be made from the invoice itself.

Manual Payments

Payments > Entry > Payments

1. Select Manual Type (See Exhibit 7.115)

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 2. Select the “Bank Account”
3. Select the “Document” ie check
4. Click on “OK”
5. Select the “Supplier”
6. Select the “Supplier Site”
7. Click on “Enter/Adjust Invoices”
8. Select invoice to be paid
9. Optionally, enter “Bank Charges” to be recovered
10. Save

11. Click on Enter/Adjust Invoices (See Exhibit 7.116)

12. Select the Invoice from the Available invoices
13. Click OK and Save

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 14. Payment has been processed. Requery the payment batch to view payments.

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Quick Payments

1. Select the “Bank Account” (See Exhibit 7.118)

2. Select the “Document” ie check
3. Click on “OK”

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 4. Select the “Supplier” (See Exhibit 7.119)
5. Select the “Supplier Site”
6. Click on “Enter/Adjust Invoices”
7. Select invoice to be paid
8. Optionally, enter “Bank Charges” to be recovered
9. Save

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 10. Click on Enter/Adjust Invoices (See Exhibit 7.120)
11. Select the Invoice from the Available invoices
12. Click OK and Save

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 13. Payment has been processed. Requery the payment batch to view payments.
(See Exhibit 7.121)

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 14. Click on “Actions” (See Exhibit 7.121)
15. Click on “Format”
16. Click on “Print Now”
17. Select the “Printer”
18. Select “Create Accounting”
19. Click “OK”

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 20. Click on “Payment Overview” to see the payment details (See Exhibit 7.122)
21. Click on ‘Invoice Overview’ to see the payment status

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Exhibit 7.122

Modify Payments
Payments can be modified but it is optional. New invoice can be entered or
payment amount can be changed with modify payments.

Payment can be modified only payment status has changed to Built.

1. Query Batch Name and make sure the payment status is Built.
2. Press Payments button to modify payments

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 3. Select the invoice number to modify (See Exhibit 7.124)
4. Select No in Pay column
5. Enter the Payment Amount details
6. Click on Build, to rebuild the payment batch.
7. Follow the rest of the payment processes.

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Payment Cancellation
Payments can be cancelled prior completing of the Payment process. Payment
batch status should not be ‘Confirmed’. Payment batch can be cancelled for
Selected, Built, Formatted status.

1. Query Batch Name and make sure the payment status is not ‘Confirmed’
2. Press Payments Actions Button
3. Uncheck any boxes are checked by default
4. Check ‘Cancel Payment Batch’ box to cancel the payment batch and press OK

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 5. Requery Batch to see the payment is cancelled. (See Exhibit 7.126)

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Void Payment
Payments can be Void but it is optional.

1. Query the Payment batch by clicking Torch from the tools menu (See
Exhibit 7.127)
2. Enter the payment search criteria such as Payment Document Number,
Supplier, Date of Payment made etc.,
3. Pres Find

4. Payment record will be displayed (See Exhibit 7.128)

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 1. Press Actions...1 (See Exhibit 7.129)
2. Check the ‘Void’ box to void the payment
3. Press OK to void payment.
4. Click OK on Caution

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 5. Requery the payment batch, the original payment is voided. (See Exhibit
7.130)

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 6. The system will reverse the original payment journal, create the following
journal. (See Exhibit 7.131)
7. Click on ‘Payment Overview’ and from the Tools Menu, Click ‘View
Accounting’

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Exhibit 7.131

Inquiry

Supplier Inquir
Suppliers>Inquiry

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Exhibit 7.132

Invoice Inquiry
Invoices>Inquiry

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Exhibit 7.133

Payment Inquiry
Payments>Inquiry

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Period Process

At the end of an accounting period, journal entries for transactions must be

posted to the General Ledger to support reconciliation and financial
statements. Close the Payables period once completes the accounting entries
to general ledger.

1. Complete entry of all Invoice Batches that should be included in period and
Run Invoice Register.
2. Complete entry of all Expense Reports that should be included in period.
3. Run Payables Invoice Import to import Expense Reports
4. Use the following execution reports to verify the import processing of
employee expense reports:
5. Run Invoice Import Report

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 6. Run Invoice Import Prepayments Applied Report
7. Run Invoice Import Exceptions Report
8. Run Invoice Register
9. Run Payables Approval to approve all invoice batches
10. Invoice on Hold Report - to check if invoices are on hold, release holds if any
11. Rerun Invoice on Hold Report to confirm Holds are released
12. Run Cash Requirement Report to forecast your cash needs for invoice
payments. Before every payment batch, you can submit this report to
determine your cash requirements for the payment batch.
13. Run Prepayment Remittance Report to generate notices to include with check
payment. Needed for employee expense checks.
14. Run the Payables Accounting Process, to create all the accounting entries.
15. Run the Unaccounted Transactions Report, to identify and resolve any
unaccounted transactions.
16. Run Payments Transfer to GL Request Set to transfer payments to GL for
posting.
17. Find the next Future Entry Period: set Status = Open
18. Find the current Period, set Status = Closed
19. (If you have problems closing AP. Then run the Invoice Sweep process)
20. Run Unposted Invoice Sweep process. This program is used to transfer
invoices and payments from one period to another. Invoices on hold will not
post and therefore need to have the G/L Date changed to the future period
before the current AP period can be closed.
21. Run Period Close Reports for AP Request Set to produce:
a. Accounts Payable Trial Balance
b. Posted Invoice Register
c. Posted Payments Register
d. Payment Register
e. Void Payment Register (by Void Date)
f. Invoice Aging Report
g. Prepayments Status Report
22. Forward Posted Invoice and Posted Payment Registers to GL Accountant.

Reconcile open invoices

Reconcile unpaid open invoices posted to the AP Liability Account using the AP Trial
Balance Report and Posted Invoice and Payment Registers. Verify that:

Sign Report Amount

Prior Month AP Trial Balance

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 Plus Current Posted invoices (from posted invoice register)
Minus Current Posted Payments (From posted payments register)
Equals Current month AP Trial balance
Equals AP Liability Account Balance
Note: Run General Ledger Account Analysis Reports for each AP Liability account
to review a listing of detail transactions posted to each Bank Account for reference
during reconciliation.

Reconcile Payments

Verify that the Prepayment Status Report equals the Prepayment account
balances. Verify that Payments Register balance equals Posted Payment
Register balance. Verify that Void Payment Register entries are accounted for
on the Posted Payment Register, and have a 0.00 amount.
Sign Report Amount
Payment Register
Equals Posted Payment Register
Equals Cash Account PTD Activity
Equals Current month AP Trial balance
Equals AP Liability Account Balance

Reconcile Cash Accounts using the Posted Payment Register

Sign Report Amount

GL Cash Account period activity
Minus AR Receipts Debits
Minus Payroll Journal Debits
Minus Misc. Transactions (i.e. wire transfers)
Minus Other GL Journal Activity
Equals Posted Payment Register
Note: Run General Ledger Account Analysis Reports for each AP Liability account
to review a listing of detail transactions posted to each Bank Account for reference
during reconciliation.

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