APPS FAQ-2

1.What are the mandatory steps for Payable module before entering transactions?

Ø Create application user sign–ons and passwords.

Ø Define your chart of accounts.

Ø Define your accounting period types and accounting calendar periods.

Ø Define a set of books. Specify a set of books name and assign it a calendar, functional currency, and a chart of accounts structure.

Ø After choosing your set of books, use the Application Developer responsibility to set the GL Set of Books ID profile option to Updateable.

Ø After choosing your set of books, use the System Administrator responsibility to set the GL Set of books Name profile option. If you are not using multiple organizations feature, set the option for the Oracle Payables application. If you are using multiple organizations feature, set the option for each unique combination of organization and responsibility.

Ø Define Payables Lookups.

Ø Define Purchasing Lookups.

Ø Enter locations.

Ø Enter employees. If you have Oracle Human Resources installed, use the People window. See: Entering a New Person (Managing People Using Oracle HRMS). If you do not have Oracle Human Resources installed, use the Enter Person window.

Ø If Oracle Inventory or Oracle Purchasing is installed, you must define at least one Inventory Organization before defining Financials Options.

Ø Define payment programs.

Ø Install or upgrade Payables.

Ø Select your primary set of books.

Ø Use the System Administrator responsibility to assign your set of books to a responsibility.

Ø Define Financials options.

Ø Define Payables options.

Ø Define your payment terms.

Ø If you plan to use automatic withholding tax, define Tax Authority type suppliers. You must do this before defining tax codes and tax groups.

Ø Define bank accounts.

Ø Define Suppliers.

Ø Open your Payables accounting period.

Ø Set up Print Styles and Drivers for the Supplier Mailing Labels Report.

2.What is ‘pay date basis’? Explain the different options available in it.

Pay Date Basis. The Pay Date Basis default for each new supplier you enter. The Pay Date Basis for a supplier defaults to the new supplier sites you enter for the supplier. You can override the default for each supplier and supplier site.

Discount. Payables selects invoices for payment based on the scheduled payment discount date.

Due. Payables selects invoices for payment based on the scheduled payment due date, regardless of any available discounts.

3.How to record a refund from a one-time supplier? Explain accounting entries also.

By entering the Debit Memo we can record the recover from supplier, The one time supplier is only for the information on suppliers not for the controlling.

The accounting entries for the same as follows

4.What do you mean by pay through date and additional pay through days?

Pay Through Date. Payables selects all approved and unpaid invoices that have a due date on or before the Pay Through Date. You cannot update this field after invoice selection for a payment batch.

Additional Pay Through Days. Number of days between your regular payment batches. Payables uses the additional pay through days to determine the default Pay Through Date when you initiate a payment batch. For example, if you define 5 as the value in this field, Payables adds 5 days to the system date to calculate the default Pay through Date when you initiate a payment batch.

5.How to define a payment term, if you require to pay a supplier 50% on delivery and 50% on installation?

This can be solved in so many ways, by using special calendar we can resolve this problem.

6.How to identify the Set of Books name in payables?

1. Choose set of Books
2. Payables options Accounting Methods Region
3. Profile Options

7.In case of void and re-issue, whether the same document will be issued or new document will be issued?

Allow Void and Reissue. If you enable this option, you can reissue a Quick payment. You may need to reissue a check for a Quick payment if it is spoiled during printing. When you reissue a check, Payables voids the old check and creates a replacement check. The checks are identical except that the new check as a new check number, payment date, and payment exchange rate if you are using multiple currencies. You cannot select the Void and Reissue option for future dated payments

8.What are different calculation levels of Automatic tax calculation?

Calculation Level. If you enable the Use Automatic Tax Calculation option, select the level at which you want Payables to automatically calculate sales tax. This value defaults to new suppliers you enter.

Header. Automatically create tax distributions based on the Invoice Amount and Tax Code in the Invoices window:

Tax Code. Automatically create tax distributions based on the distribution Amount, Tax Code, and Includes Tax check box in the Distributions window. When calculating tax amounts, group lines with the same tax code and Includes Tax check box setting together, calculate tax, and then round the tax amount.

Line. Automatically create tax distributions based on the distribution Amount, Tax Code, and Includes Tax check box in the Distributions window. When calculating tax amounts, calculate tax for each distribution, round the tax amount, then add the tax amounts.

9.Is it possible to un-apply a pre-payment invoice if it is already applied to a standard invoice?

Yes, we can unapply the prepayments at any status except when it is cancelled. Prepayment apply will not calculate discounts as it is already paid.

10.what options are to be enabled if invoice Currency and Payment Currency are different?

As the invoice currency and payment currency should be same due to which there is no option available with respect to this.

11.List any five standard reports in oracle payables.

Five Standard Reports

1. Invoice Aging Report


2. Invoice Audit Report


3. Payables account analysis Report


4. Payment Batch Control Report


5. Payment distribution Report

12.How to set different interest rates for different suppliers?

There are no such options available for defining different interest rates for different suppliers. There are only uniform interest rates.

13.When ‘tax code’ at invoice header will be mandatory?

Require Tax Entry at Header. If you enable this option, Payables requires you to enter a Tax Code and Tax amount in the Invoices window when you enter an invoice.

The calculation should be Header, in this situation the tax code at header level should be mandatory.

14.Is ‘Invoice received date’ mandatory or optional?

Invoice received date is optional if the terms date is set to other than Invoice Received date.

15.Explain the relevance of ‘Pooled Account’.

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 then pay the invoice from a pooled bank account, then which Payables accounts for the invoice payment, Payables creates one corresponding cash accounting entry for each liability distribution.

17. When I’m trying to ‘Approve’ invoice, Approve button is grayed out. What could be the reason?

Allow Online Approval. Enable this option if you want to allow users to submit Payables Approval in the Invoices window and the Invoice Batches window.

If you are not enable the above circled item then the above case will arise.

18.How to resolve the following error: “The payment date must be on or after the system date”.

The above error can be resolved by checking the circled item

Allow Pre–Date. If you enable this option, Payables allows you to create payments with a payment date before the system date for any payment except a manual payment.

.What are different status in payment batch ?

ANS - Status (Payment Batches window only). Payables displays the status of the payment batch. Payables displays the status in red if there is an error, for example, if the concurrent manager goes down during a process.

Suggestion: If you are in the Payment batches window and you want to monitor the status of a payment batch that is, choose Refresh Status from the Tools menu.

1. Building. Payables is determining which invoices will be paid by each payment document.
2. Built. Payables has determined which invoices will be paid with each payment document. You can now review the Preliminary Payment Register, Modify the Payment Batch, or Format the Payment Batch.
3. Cancelled. You have cancelled the payment batch.
4. Cancelling. Payables is cancelling the payment batch.
5. Confirmed. You have confirmed the payment batch.
6. Confirming. Payables is either confirming or partially confirming the payment batch based on the action you selected in the Confirm Payment Batch window.
7. Formatted. Payables has completed formatting your payments and has created the output file that you can use to print checks or, if you are making electronic payments, you can deliver the output file to the e-Commerce Gateway or your bank for processing.
8. Formatting. Payables has created the output file that you can use to print checks or, if you are making EFT payments, you can deliver the output file to your bank for processing.
9. Modified. Payables has modified the payment batch based on the modifications you made in the Modify Payment Batch window.
10. Modifying. Payables is modifying the payment batch based on the modifications you made in the Modify Payment Batch window.
11. Rebuilding. You have modified a payment batch, and Payables is rebuilding the modified payment batch.
12. Restarting. You have confirmed a partial payment batch and have chosen Restart Payment Batch in the Confirm Payment Batch window. Payables is rebuilding and reformatting the remaining portion of the payment batch.
13. Selected. Payables has selected invoices that match the payment batch criteria you entered.
14. Selecting. Payables is selecting invoices that match the payment batch criteria you entered.
15. Unstarted. The payment batch is unstarted.

2. Explain The concept of Automatic Offset ?

If you enter invoices for expenses or asset purchases for more than one balancing segment, you might want to use Automatic Offsets to keep your Payables transaction accounting entries balanced.
If you do not use Automatic Offsets, Payables creates a single liability accounting entry for invoice transactions (if you use accrual basis accounting) and a single cash type accounting entry for payment transactions.
When you use Automatic Offsets, Payables automatically creates balancing accounting entries for your transactions. The GL account that each of the offsetting accounting entry is charged to depends on which method you use, Balancing or Account:

• • Balancing. Payables builds the offsetting GL account by taking the balancing segment (usually the cost center code) from the invoice distribution and overlaying it onto the appropriate default GL account, for example the Liability account from the supplier site.

• • Account. The Account method takes the opposite approach with one segment (the designated account segment) being retained from the default GL account and all other segments being retained from the invoice distribution.

Although Payables builds the GL account to which amounts are charged differently depending on the method you use, in either case Payables automatically allocates the amount across the following accounting entries for an invoice:

• • Liability

• • Withholding Tax (if you apply the withheld amount at Approval time)

Payables also allocates the following entries for a payment:

• • Cash (if you use a pooled bank account)

• • Cash Clearing (if you use a pooled bank account, and if you account for payments at clearing time)

• • Discount

• • Exchange Gain/Loss

• • Future Dated Payment

• • Rounding

• • Withholding Tax (if you apply the withheld amount at Payment time)

• • Bank Charges

• • Bank Errors
  
  

Automatic Offsets affects only accounts listed above. For accounts other than these, for example, Interest Liability, you must make manual journal entries in your general ledger to keep the entries balanced at the balancing segment level.

Example

The following diagram illustrates how Payables builds a GL account on a liability distribution using the two different methods:

3.What is an ERS? How is it setup?

Payment on Receipt enables you to automatically create standard, unapproved invoices for payment of goods based on receipt transactions. Invoices are created using a combination of receipt and purchase order information, eliminating duplicate manual data entry and ensuring accurate and timely data processing. Payment on Receipt is also known as Evaluated Receipt Settlement (ERS) and Self Billing.

You can automatically create invoices with multiple items and distribution lines, and include tax.

You define which supplier sites participate in Payment on Receipt and enforce matching rules to ensure the proper payments are made to the suppliers.

Amount - Payment on Receipt builds invoices with the following information: Determined by multiplying the Quantity received by the Purchase Order Item Unit Price.

Payment Terms - Defaulted from the purchase order payment terms or from the supplier site payment terms, depending on your Oracle Public Sector Payables setup.

Tax - Based on Tax Codes on each purchase order shipment, or the default tax hierarchy in Payables.

If the purchase order currency and the supplier site Payment Currency (in the Supplier Sites window) are not fixed–rate currencies (for example, not euro–related currencies), Payment on Receipt builds the invoices this way, regardless of the supplier site Invoice Currency:

Invoice Currency - Defaulted from the purchase order Currency.

Payment Currency - Defaulted from the purchase order Currency.

If the purchase order currency and the supplier site Payment Currency are fixed–rate currencies (for example, euro–related currencies), Payment on Receipt builds the invoices this way, regardless of the supplier site Invoice Currency:

Invoice Currency - Defaulted from the purchase order Currency.

Payment Currency - Defaulted from the supplier site Payment Currency. For example, if the purchase order Currency is francs and the supplier site Payment Currency is the euro, the Payment Currency on the invoice is the euro.

Defaulted from the supplier site Invoice Currency if no supplier site Payment Currency is defined and the supplier site Invoice Currency is a fixed–rate currency.

Defaulted from the purchase order Currency if the supplier site Invoice Currency is not a fixed–rate currency. If the Alternate Pay Site is populated for the Supplier Site used on the Purchase Order, the invoice created is for the Alternate Pay Site, otherwise the Supplier Site on the Purchase Order is used. The Supplier Site used for the invoice must be defined as a Pay Site.

4. Explain the Withholding Tax Accounting.

5.What is the format of Interest Invoice number?

Ans. Interest Invoice format no. is splited into three segments they are Invoice No on which interest is calculated, INT and no. of times paid the Example as follows

6. What are different types of special calendar?

There are four special calendars they are

1. Recurring Invoice


2. Withholding Tax


3. Payment Terms


4. Key Indicator

7.How the terms date will be calculated for recurring invoices?

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:

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

Ø 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.

8.What is the default invoice date for recurring invoices?

Every month first date will be the default date for recurring invoice.

9.How to define foreign currency recurring Invoice Template ? What are the additional considerations?

Optionally change the invoice currency, which is your functional currency unless you have a supplier site default. If you enter a foreign currency, enter exchange rate information when you create invoices based on the template.

10. What are the prerequisites for auto creation of Debit Memo of RTS transactions?

Check the check box “Create Debit memo for RTS transactions” under purchasing Tab page in Supplier site. And in purchase module in “Returns Form” Check the Check Box Create debit memo.

11.What is the number format of invoice generated based on ERS? Name the profile option related to this.

The Name of the Profile is PO: ERS invoice Number Prefix.

The number format of invoice generated are,

Ø Default Profile name.

Ø Depends upon the Invoice summery level (Purchasing Tab page in Supplier site) the number will vary either Receipt No. or Packing slip No. Or Supplier No.

Ø System generated No.

12.What reports will be shown if you run concurrent program for Expense report?

Ø Payables Invoice Import Audit Report

Ø  Payables Invoice Import Exceptions Report

Ø Payables Invoice Import Prepayments Applied Report

13.What is the relevance of Withholding tax group?

Use this window to define withholding tax groups that include multiple Withholding Tax type tax codes. You can assign the same tax code to more than one group. When you assign a withholding tax group to an invoice or distribution, Payables calculates invoice withholding tax based on every tax code in the withholding tax group. For example, you assign a withholding tax group to an invoice or distribution if you need to withhold taxes at both the local and country level, each withheld at different rates and remitted to different tax authorities. You define and assign to the invoice or distribution a Withholding Tax Group that includes both taxes.

You rank all of the tax codes in a withholding tax group when you define the group. When you enter an invoice and enter a withholding tax group, Payables calculates the taxes in order of rank. Lower ranked taxes are applied to the amount of the invoice or distribution amount less the previous withholding tax amounts.

14. What are different rate structure for Withholding Tax ?

Period Limit. After you pay a certain amount for a withholding tax in a period, Payables does withhold further taxes. For example, for each special calendar period, Payables withholds no more than $10,000.

If you select this value you must enter values for the Period Limit, and Calendar fields. You cannot enter values for the Amount Basis and Period Basis fields.

Flat Rate. The withholding tax has no amount or period limits. If you select this value you cannot enter a value in the Amount Basis, Period Basis, and Period Limit fields.

Amount Ranges. The tax rate depends on how much you have already paid during a time period. Base the paid amount on either the gross amount of total paid invoice amounts, or on the total amount of tax withheld. The time period can be per withholding tax calendar period or per invoice. For example, define a tax that for each invoice that withholds at a rate of 10% until you have paid $1000 in tax, after which it withholds at 15%. If you select this value you must enter values for the Amount Basis and Period Basis fields. If you select Period as your Period Basis, you must also select a Calendar. You cannot enter a value for Period Limit.

15. What is the relevance of ‘Period Basis’ field in withholding tax details from and when it can be chosen?

Period Basis. To enter amount ranges in the Tax Rates region, select Amount Ranges as the Rate Type, and specify an Amount Basis and a Period Basis.

Ø Invoice. Select Invoice if you want to apply an amount range to each invoice.

Ø Period. Select Period to apply an amount range to a Withholding Tax period. If you enter a value here, then specify the name of the special calendar that uses the periods you want to use.

16. What are the Pre – requisites for Withholding Tax Invoices?

Ø Tax authority to defined as supplier

Ø Tax codes & Tax groups to be defined

Ø Special calendar to be defined

Ø Enable the Check box Use withholding Tax under Withholding Tab page in payables options.

17. How to view supplier Balance?

(N) – Invoices – Inquiry – Invoices, here you can find out balance of supplier (B) “Calculate Balance Owed” by providing supplier information at Header.

OR

Go to the Invoice work bench and go to the Menu - View - Find the screen will be opened as find invoice in that give your supplier name and site and click on the “Calculate Balance Owed”

18.What is the format of Withholding Tax Invoice Number?

Withholding Tax – System Generated No. – Invoice distribution Line No.

19. What are there any payable options related to expense Report.

Ø Default Template

Ø Payment Terms

Ø Pay Group

Ø Payment priority

Ø Apply advance

Ø Automatically Create employee as supplier

Ø Hold unmatched Expense Report

.Explain different types of transaction in Receivables.

Invoice In Oracle Projects, a summarized list of charges, including payment terms, invoice item information, and other information that is sent to a customer for payment.

Debit memos Debits that you assign to a customer to collect additional charges. For example, you may want to charge a customer for unearned discounts taken, additional freight charges, taxes, or finance charges.

Charge backs A new debit item that you assign to your customer when closing an existing, outstanding debit item.

Credit memo In Oracle Receivables, a document that partially or fully reverses an original invoice. You can create credit memos in the Receivables Credit Transactions window or with Auto Invoice.

Deposit A type of commitment whereby a customer agrees to deposit or prepay a sum of money for the future purchase of goods and services

Guarantee A contractual obligation to purchase a specified amount of goods or services over a predefined period of time.

02. What is Application Rule Set?

Application Rule Sets

Use the Application Rules Sets window to review existing and define new application rule sets. Application rule sets specify the default payment steps for your receipt applications and how discounts affect the open balance for each type of associated charges. By defining your own application rule set, you can determine how Receivables reduces the balance due for a transaction’s line, tax, freight, and finance charges.

Receivables provides the following application rules:

Line First – Tax After: Apply to the open line item amount first. Apply any remaining amount in the following order: tax, freight, and then finance charges.

Line First – Tax Prorate: Apply a proportionate amount to the open line item amount and the open tax amount for each line. Apply any remaining amount to freight and then to finance charges.

Prorate All: Apply a proportionate amount to the line, tax, freight, and finance charges.

To define an application rule set:

1. Navigate to the Application Rule Sets window.

2. Enter a Name and Description for this rule set.

3. Enter the Sequence number for this application rule. Receivables apply payments in this sequence, beginning with the lowest sequence number.

Note: You cannot enter a sequence number for the Over application rule. By default, this rule is last in the sequence for each application rule set.

4. Enter an application Rule. Each rule will correspond to a line type (for example, lines, freight, or charges), so you should give your rule a descriptive name. Each rule set must have at least one application rule.

Attention: Receivables automatically assigns the Over application rule to each application rule set. You cannot delete this rule. The Over application rule applies any remaining amount after the balance due for each item has been reduced to zero. If the transaction type of the debit item allows over application, this rule prorates the remaining amount between each line and its associated tax amount, making these amounts negative. If the transaction type does not allow over application, either you can place the remaining amount on–account or leave it ’Unapplied’.

5. Enter Rule Details for this application rule. This section indicates the type of charges and the tax handling for this rule. Choose a Type of Line, Freight, or Charges. You need to enter at least one type for your rule set.

6. If you chose a Type of ’Line’, choose a Tax Treatment. Choose one of the following:

Prorate: Choose this option to proportionately reduce the net amount of the line and associated tax amounts.

Before: Choose this option to first reduce the open tax amount, then apply any remaining amount to the line.

After: Choose this option to reduce the open line amount, then apply any remaining amount to the associated tax.

Note: The default Tax Treatment for your Freight and Charges types is None. This option ignores tax, since you cannot tax freight and charges in Receivables. You cannot choose None for your Line type.

7. To automatically adjust this line type to account for any rounding corrections within this rule set, check the Rounding Correction box. When an amount is prorated among several line types, Receivables must use one of the line types to account for the rounding adjustment. Each application rule set must have one and only one rounding correction line type.

Suggestion: Assign the Rounding Correction to the line type that is usually the largest portion of your invoices. By doing this, the rounding correction will have the least effect on the overall remaining and applied amounts for this line type.

8. Repeat the previous steps for each rule you want to add to this rule set.

9. Save your work.

10. When you are satisfied with this rule set definition, check the Freeze box. Receivables verify that your application rule set is defined properly and that it does not violate any basic application guidelines. If this rule set fails validation, Receivables displays an error message. In this case, modify your rule set definition, and then check the Freeze box again to revalidate it.

Attention: A rule set must be ’frozen’ before you can assign it to a transaction type or use it as your default rule it in the System Options window. Additionally, after you freeze an application rule set, you cannot update or delete it.

03. Explain Auto Accounting.

Define Auto Accounting to specify how you want Receivables to determine the general ledger accounts for transactions that you enter manually or import using Auto Invoice. Receivables create default accounts for revenue, receivable, freight, tax, unearned revenue, unbilled receivable, finance charges, bills receivables accounts, and Auto Invoice clearing (suspense) accounts using this information. When you enter transactions in Receivables, you can override the default general ledger accounts that Auto Accounting creates. You can control the value that Auto Accounting assigns to each segment of your Accounting Flex field, such as Company, Division, or Account. You must define Auto Accounting before you can enter transactions in Receivables.

Suggestion: If you use the multiple organization support feature, you can set up Auto Accounting to derive the Product segment of your Revenue account based on inventory items. To do this, define the Product segment of your Revenue account to use Standard Lines and specify a Warehouse ID when entering transactions.

To define Auto Accounting:

1. Navigate to the Automatic Accounting window.

2. Enter the Type of account to define. Choose from the following:

Auto Invoice Clearing: The clearing account for your imported transactions. Receivables use the clearing account to hold any difference between the specified revenue amount and the selling price times the quantity for imported invoice lines. Receivables only use the clearing account if you have enabled this feature for the invoice batch source of your imported transactions.

Bills Receivable: The bills receivable account for your transaction. Receivables use this account when you exchange transactions for bills receivable.

Factored Bills Receivable: The factored bills receivable account for your bills receivable transactions.

Freight: The freight account for your transaction.

Receivable: The receivable account for your transaction.

Remitted Bills Receivable: The remitted bills receivable account for your bills receivable transactions.

Revenue: The revenue and finance charges account for your transaction.

Tax: The tax account for your transaction.

Unbilled Receivable: The unbilled receivable account for your transaction. Receivables use this account when you use the Bill In Arrears invoicing rule. If your accounting rule recognizes revenue before your invoicing rule bills it, Receivables uses this account.

Unearned Revenue: The unearned revenue account for your transaction. Receivables use this account when you use the Bill In Advance invoicing rule. If your accounting rule recognizes revenue after your invoicing rule bills it, Receivables uses this account.

Unpaid Bills Receivable: The unpaid bills receivable account for your bills receivable transactions.

3. For each segment, enter either the table name or constant value that you want Receivables to use to get information. When you enter an account Type, Receivables displays all of the segment names in your Accounting Flexfield Structure. Segments include such information as Company, Product, Department, Account, and Sub–Account. Receivables lets you use different table names for different accounts. Choose one of the following table names:

Bill To Site: Use the bill–to site of the transaction to determine this segment of your revenue, freight, receivable, Auto Invoice clearing, tax, unbilled receivable, and unearned revenue account.

Drawee Site: Use the drawee site table to determine this segment of your bills receivable, factored bills receivable, remitted bills receivable, and unpaid bills receivable account.

Remittance Banks: Use the remittance banks table to determine this segment of your factored bills receivable and remitted bills receivable account.

Salesperson: Use the salesperson’s table to determine this segment of your revenue, freight, receivable, AutoInvoice clearing, tax, unbilled receivable, and unearned revenue account. If you choose this option for your AutoInvoice clearing, tax, or unearned revenue accounts, Receivables uses the revenue account associated with this salesperson. If you choose this option for your unbilled receivable account, Receivables uses the receivable account associated with this salesperson. If the transaction has a line type of ”LINE” with an inventory item of freight (”FRT”), AutoAccounting uses the accounting rules for the freight type account rather than the revenue type account.

Standard Lines: Use the standard memo line or inventory item on the transaction to determine this segment of your revenue, AutoInvoice clearing, freight, tax, unbilled receivable, and unearned revenue account. If you choose this option for your AutoInvoice clearing, freight, tax, unbilled receivable or unearned revenue accounts, Receivables uses the revenue account associated to this standard memo line item or inventory item. If the transaction has a line type of ”LINE” with an inventory item of freight (”FRT”), AutoAccounting uses the accounting rules for the freight type account rather than the revenue type account.

Taxes: Enter this option to use tax codes when determining your tax account.

Transaction Types: Use the transaction types table to determine this segment of your revenue, freight, receivable, AutoInvoice clearing, tax, unbilled receivable, and unearned revenue account, and of your bills receivable, factored bills receivable, remitted bills receivable, and unpaid bills receivable account. If the transaction has a line type of ”LINE” with an inventory item of freight (”FRT”), AutoAccounting uses the accounting rules for the freight type account rather than the revenue type account.

4. If you did not enter a Table Name, enter a Constant value for this segment, or select one from the list of values. Enter a Constant value if you want AutoAccounting to always use the same value for this Accounting Flexfield segment. Be sure to enter information that is valid for this segment. For example, if you defined your Company flexfield segment as a two–character segment with valid values ranging from 00 to 10, you must enter a two–character value within this range.

5. Save your work.

4. What is Auto Cash Rule Set?

Define Auto Cash Rule Sets to determine the sequence of Auto Cash Rules that Post Quick Cash uses to update your customer’s account balances. You specify the sequence and the Auto Cash Rules for each Auto Cash Rule Set. The Auto Cash Rule Sets you define display as list of values choices in the Customers, Customer Addresses, Customer Profile Classes, and the System Options windows. Post Quick Cash first checks the customer site, then the customer profile class, and finally at the system options level to determine the Auto Cash Rule Set to use.

Receivables provides a default AutoCash Rule Set when you assign a customer to a credit profile, but you can modify individual AutoCash Rule Set assignments at both the customer and customer site levels. If you do not assign an AutoCash Rule Set to a customer’s credit profile, and you enter a receipt for this customer, Receivables uses the AutoCash Rule Set that you entered in the System Options window along with the number of Discount Grace Days you specified in this customer’s credit profile to apply the receipt. If you assign an AutoCash Rule Set to a customer, but none of the AutoCash Rules apply, Receivables places the remaining amount Unapplied or On–Account, depending on how you set the Remaining Remittance Amount option for the rule set.

If you have set up your system to use bank charges and a tolerance limit, Post QuickCash will also consider these amounts if the current AutoCash rule fails (this is true for all rules except ’Apply to the Oldest Invoice First’). If it finds a match, Post QuickCash applies the receipt; otherwise, it looks at the next rule in the sequence. You can disable an existing AutoCash Rule Set by changing its status to Inactive and then saving your work.

Prerequisites

Define system options

To define an AutoCash Rule set:

1. Navigate to the AutoCash Rule Sets window.

2. Enter the Name of this AutoCash rule set.

3. Enter a description for this AutoCash rule set (optional).

4. Enter the type of Discount you want to automatically give to your customer for this AutoCash Rule Set. Choose one of the following Discount options:

Earned Only: Your customer can take earned discounts according to the receipt terms of sale. You negotiate earned discount percentages when you define specific receipt terms. You can enter this option if Allow Unearned Discounts is set to yes in the System Options window. In this case, Receivables only allows earned discounts for this AutoCash Rule Set.

Earned and Unearned: Your customer can take both earned and unearned discounts. An unearned discount is one taken after the discount period passes. You cannot choose this option if the system option Unearned Discounts is set to No.

None: Your customer cannot take discounts (this is the default).

5. To include transactions in dispute when calculating your customer’s open balance, check the Items in Dispute check box.

6. To include finance charges when calculating your customer’s open balance, check the Finance Charges check box.

7. Define the Automatic Matching Rule for this AutoCash Rule set.

8. If this rule set will include the Apply to the Oldest Invoice First rule, choose how you want to apply any Remaining Remittance Amount. Receivables uses this value to determine how to enter the remaining amount of the receipt if none of the AutoCash Rules within this rule set apply. Choose ’Unapplied’ to mark remaining receipt amounts as Unapplied. Choose ’On–Account’ to place remaining receipt amounts On–Account.

9. To automatically apply partial receipts when using the Apply to the Oldest Invoice First rule, check the Apply Partial Receipts check box. A partial receipt is one in which the receipt minus the applicable discount does not close the debit item to which this receipt is applied. The applicable discount that Receivables uses for this rule depends upon the value you entered in the Discounts field for this AutoCash Rule Set. If you exclude finance charges (by setting Finance Charges to No) and the amount of your receipt is equal to the amount of the debit item to which you are applying this receipt minus the finance charges, Receivables defines this receipt as a partial receipt. In this case, Receivables does not close the debit item because the finance charges for this debit item are still outstanding.

If Apply Partial Receipts is set to No, this AutoCash Rule Set will not apply partial receipts and will either mark the remaining receipt amount ’Unapplied’ or place it on–account, depending on the value you entered in the Remaining Remittance Amount field.

10. Enter a Sequence number to specify the order of each rule in this AutoCash Rule Set (optional). Receivables uses the rule assigned to sequence 1, then sequence 2, and so on when applying receipts using this AutoCash Rule Set.

11. Enter one or more AutoCash Rules for this AutoCash rule set. Choose from the following AutoCash rules:

Apply to the Oldest Invoice First: This rule matches receipts to debit and credit items starting with the oldest item first. This rule uses the transaction due date when determining which transaction to apply to first. This rule uses the values you specified for this AutoCash Rule Set’s open balance calculation to determine your customer’s oldest outstanding debit item.

Post QuickCash uses the next rule in the set if any of the following are true:

– all of your debit and credit items are closed

– the entire receipt amount is applied

– it encounters a partial receipt application and Allow Partial

Receipts is set to No for this AutoCash Rule Set

– the next oldest debit item includes finance charges and Finance Charges is set to No for this AutoCash Rule Set This rule marks any remaining receipt amount ’Unapplied’ or places it on–account, depending on the value you entered in the Remaining Remittance Amount field for this AutoCash Rule set

Clear the Account: Post QuickCash uses this rule only if your customer’s account balance exactly matches the amount of the receipt. If the receipt amount does not exactly match this customer’s account balance, Post QuickCash uses the next rule in the set. This rule calculates your customer’s account balance by using the values you specified for this AutoCash Rule Set’s open balance calculation and the number of Discount Grace Days in this customer’s profile class. This rule also includes all of this customer’s debit and credit items when calculating their account balance. This rule ignores the value of the Apply Partial Receipts option.

This AutoCash Rule uses t he following equation to calculate the open balance for each debit item:

Open Balance = Original Balance + Finance Charges – Discount

Receivables then add the balance for each debit item to determine the customer’s total account balance. The ’Clear the Account’ rule uses this equation for each invoice, chargeback, debit memo, credit memo, and application of an Unapplied or On–Account receipt to a debit item.

Note: The discount amount for each item depends upon the payment terms of the item and the value of the Discounts field for this AutoCash Rule Set. The number of Discount Grace Days in this customer’s credit profile, along with the payment terms assigned to their outstanding invoices, determine the actual due dates of each debit item.

Clear Past Due Invoices: This rule is similar to the ’Clear the Account’ rule because it applies the receipt to your customer’s debit and credit items only if the total of these items exactly matches the amount of this receipt. However, this rule only applies the receipt to items that are currently past due. A debit item is considered past due if its due date is earlier than the receipt deposit date. This rule considers credit items (i.e. any pre–existing, unapplied receipt or credit memo) to be past due if the deposit date of the receipt is either the same as or later than the deposit date of this pre–existing receipt or credit memo. In this case, this rule uses a pre–existing receipt or credit memo before the current receipt for your AutoCash receipt applications. If this AutoCash Rule Set’s open balance calculation does not include finance charges or disputed items, and this customer has past due items that are in dispute or items with balances that include finance charges, this rule will not close these items. This rule ignores the value of the Apply Partial Receipts option.

Clear Past Due Invoices Grouped by Payment Term: This rule is similar to the ’Clear Past Due Invoices’ rule, but it first groups past due invoices by their payment term, and then uses the oldest transaction due date within the group as the group due date.

When using this rule, Receivables can only apply the receipt if the receipt amount exactly matches the sum of your customer’s credit memos and past due invoices. A debit item is considered past due if the invoice due date is earlier than the deposit date of the receipt you are applying. For credit memos, Receivables uses the credit memo date to determine whether to include these amounts in the customer’s account balance. For example, if you are applying a receipt with a receipt date of 10–JAN–93, credit memos that have a transaction date (credit memo date) on or earlier than 10–JAN–93 will be included. Credit memos do not have payment terms, so they are included in each group.

Match Payment with Invoice: This rule applies the receipt to a single invoice, debit memo, or chargeback that has a remaining amount due exactly equal to the receipt amount. This rule uses the values that you enter for this AutoCash Rule Set’s open balance calculation to determine the remaining amount due of this customer’s debit items. For example, if Finance Charges is No for this rule set and the amount of this receipt is equal to the amount due for a debit item minus its finance charges, this rule applies the receipt to that debit item. If this rule cannot find a debit item that matches the receipt amount, Post QuickCash looks at the next rule in the set. This rule ignores the value of the Apply Partial Receipts

option.

12. Save your work.

05.What are the mandatory fields in customer profile class?

Collector

06.List the Key flexi –Fields in Receivables

Sales Tax Location Flexfield

Territory Flexfield

07.List some of the Profile Class Amount limits

Finance Charges Interest Rate

Max Interest Per Invoice

Minimum Customer Balance for Finance Charges

Minimum Invoice Balance for finance Charges

Minimum receipt Amount

Minimum Statement Amount

Min Dunning Amount

Min Dunning Inv Amount

Credit Limit

Order Credit Limit

08. What is the Default Hierarchy of payment Terms

Default Payment Terms Hierarchy

Receivables uses the following hierarchy to determine the default payment term for your transactions, stopping when one is found:

1. Bill–to site

2. Customer Address

3. Customer

4. Transaction Type

09.How to adjust an on Account Credit memo with in invoice.

Regular credit memos will not be posted, as no cash is exchanged. Therefore, if you use credit memos, ensure that the accounts on the credit memo are the same as those on the invoices associated with the credit memos. You can achieve this by setting your profile option AR:

Use Invoice Accounting For Credit Memos to Yes.

An on–account credit will be posted when it is applied to an invoice or combined with a cash receipt.

Consider the journal entries created in the following instances:

An on–account credit is issued. No journal entry is created.

The on–account credit is applied to an invoice for $100.

This table shows the journal entries that are created:

Instead of applying the on–account credit memo to an invoice, the user combines it with a cash receipt of $200.

This table shows the journal entries that are created:

By applying the on–account credit to a cash receipt, the available unapplied cash balance is increased from $200 to $300. The user applies the $300 unapplied cash balance to an invoice.

This table shows the journal entries that are created:

10.What Is the Relevance of “Open Receivables” in Transaction Type?

If Open Receivable is set to Yes, Receivables updates your customer balances each time you create a complete debit memo, credit memo, chargeback, or on-account credit with this transaction type. Receivables also include these transactions in the standard aging and collection processes.

If you are defining a 'void' transaction type, set Open Receivable to No.

Suggestion: You can use the Open Receivable option to implement an approval cycle for any temporary or preliminary debit memos, credit memos, on-account credits, chargebacks, and invoices that you may use in your business. For particularly sensitive debit memos, credit memos, on-account credits, chargebacks, and invoices that you may want to review, you can define a transaction type called Preliminary with Open Receivable set to No. This transaction type does not update your customer balances. When you review and approve the item, you can then change the transaction type to Final (a transaction type that you define with Open Receivable set to Yes) which will update your customer's balances.

11.What do you understand by “Creation Sign” in Transaction Type? Can we over ride creation Sign?

Choose a Creation Sign. The default is Positive Sign for transaction types with a class of either Guarantee or Deposit. If you are using the Cash Basis accounting method, your transaction's creation sign must be either Positive Sign, Negative Sign, or Any Sign. You cannot update this field after you enter transactions with this type.

12.What is the difference between Deposit and Guarantee? Write the accounting entries for both.

Deposit A type of commitment whereby a customer agrees to deposit or prepay a sum of money for the future purchase of goods and services

Guarantee A contractual obligation to purchase a specified amount of goods or services over a predefined period of time.

13.What do you understand by dispute amount in AR?

Dispute Amount: The current amount of this invoice, debit memo, or chargeback that is in dispute. Receivables sums up the dispute amounts for each installment of your payment schedule and display the total in this field. You can either increase or decrease the dispute amount. If you enter 0 (zero), the debit item is no longer in dispute. If your debit item does not have split terms, then you can enter a dispute amount that is between zero and the balance due for this item.

You can also place a debit item in dispute in the Customer Calls window, and review your in dispute debit items in the Disputed Invoice Report. For debit items with split terms, you can enter the dispute amount for each installment in the Installments window or you can set it to either the balance due or zero in this field.

14.Can we define proximal payment terms in Receivables?

Yes, proxima payment terms a payment term you define for invoices due on the same day each period, such as your credit card or telephone bills. When you define a proxima payment term, you specify a cutoff day and the day of month due. This type of payment term is also used with consolidated billing invoices.

15. Explain the Below Concepts:

Standard Memo Lines

A type of line that you assign to an invoice when the item is not an inventory item (for example, ’Consulting Services’). You define standard memo lines to speed data entry when creating your transactions

Transaction Source

Batch sources control the standard transaction type assigned to a transaction and determine whether Receivables automatically numbers your transactions and transaction batches. Active transaction batch sources appear as list of values choices in the Transactions, Transactions Summary, and Credit Transactions windows, and for bills receivable in the Bills Receivable and Bills Receivable Transaction Batches windows.

You can define two types of transaction batch sources:

• • Manual: Use manual batch sources with transactions that you enter manually in the Transactions and Transactions Summary windows, and for bills receivable transactions.

• • Imported: Use imported batch sources to import transactions into Receivables using AutoInvoice.
  
  

You can make a batch source inactive by unchecking the Active check box and then saving your work. Receivables does not display inactive transaction batch sources as list of values choices or let you assign them to your transactions.

Use transaction types to define the accounting for the debit memos, credit memos, on–account credits, chargebacks, commitments, invoices, and bills receivable you create in Receivables. Transaction types also determine whether your transaction entries update your customers’ balances and whether Receivables posts these transactions to your general ledger

Dunning Letters

A letter that you send to customers to inform them of past due debit items. Receivables let you specify the text and format of each letter and whether to include unapplied and on–account payments.

Split Term Method

If you are crediting a transaction that has multiple installments, choose one of the following Split Term Methods:

First in First Out (FIFO): This method credits the first installment first.

Last In First Out (LIFO): This method credits the last installment first.

Prorate: This method credits the installments of the credited transaction and prorates them based on the amount remaining for each installment.

8) Is it possible to apply a receipt from one customer to another customer’s transaction? If Yes, how to apply?

Yes, in Manual Quick batch receipt we have an option of “Multiple” under application type by selecting this option we can assign more than two customers. This option will be activated only when we select the option “Allow payment of unrelated Transactions” in System options

9) List different ‘Application types’ of receipt while creating Manual-Quick batch receipt?

They Are

• Auto Cash rule
• Single
• Multiple

· On account

• Unidentified
• Unapplied

10) Can we define Memo Lines with Invoicing Rules?

Yes, There is an option available in Memo Lines

11) What is the accounting entry, if we apply a deposit to an invoice?

Deposits

When you enter a deposit, Receivables creates the following journal entry:

DR Receivables (Deposit)

CR Revenue

When you enter an invoice against this deposit, Receivables creates the following journal entries:

DR Receivables (Invoice)

CR Revenue

CR Tax (if you charge tax)

CR Freight (if you charge freight)

DR Unearned Revenue

CR Receivables (Invoice)

When you apply an invoice to a deposit, Receivables creates a receivable adjustment against the invoice. Receivables uses the account information you specified in your AutoAccounting structure to create these entries.

When cash is received against this deposit, Receivables creates the following journal entry:

DR Cash

CR Receivables (Deposit)

12) What are the Key Flexi fields in AR? And for what purpose they will be used?

Two key Flexifield they are

Sales Tax Location Flexfield

The following table lists details for this key flexfield.

The Sales Tax Location Flexfield is used to calculate tax based on different components of your customers’ shipping addresses for all addresses in your home country.

Territory Flexfield

The following table lists details for this key flexfield.

You can use the Territory Flexfield for recording and customized reporting on your territory information. Territory Flexfields are also displayed in the Transaction Detail and Customer Detail reports in Oracle Receivables.

13) How to create On-account receipt? How to apply ‘On-account’ receipt to Transaction?

While entering receipt click on the Application Button in that select the receipt amount against On-Account and save then it will create On –account receipt, When ever you want to apply this receipt to any invoice then first make the receipt to Unapplied then apply to any invoices

14) Which one of the auto cash rules will use “Remaining Remittance Amount” Option?

Remaining Remittance Amount

If you are using the Apply to the Oldest Invoice First rule, Receivables lets you determine the status of any remaining remittance amounts. If Receivables cannot fully or partially apply a receipt using any of the AutoCash rules in your AutoCash Rule set, it will either mark the remaining amount ’Unapplied’ or place it ’On Account.’ You choose one of these options in the Remaining Remittance Amount field in the AutoCash Rule Sets window.

15) What is the difference between Exemptions and Exception with related to taxes in AR?

Define tax exemptions to fully or partially exempt a customer, item, or range of items from specific tax codes. You can create exemptions against customers or items for either locations or specific tax codes.

Use the Item Tax Rate Exceptions window to assign special tax rates to products that you ship to specific authorities.

You can only define a tax rate exception for items that can be entered on an invoice and have a status of 'Active.'

Item tax rate exceptions apply only to location based tax. Therefore, to use tax rate exceptions, your Location Flexfield Structure must be State.County.City. To use the exceptions that you define in this window, ensure that the system option Use Item Tax Rate Exceptions is set to Yes.

16) When is Paying customer mandatory for a transaction?

Paying Customer is mandatory for automatic receipts and optional for manual receipt.

17) List the various levels from where tax codes can be defaulted to transaction?

• Customer
• Customer Site
• Product
• Revenue account
• System Option

18) What are the different status of a receipt?

• Approved
• Cleared
• Remitted
• Confirmed
• Reversed

19) What are the different sources from where we can set ‘Tax’ account default while defining Auto accounting?

· Salesperson

· Site

· Standard lines

· Taxes

· Transaction Types

20) Can we define more than one receivable activity for the same type?

Define receivables activities to default accounting information for your miscellaneous cash, discounts, finance charges, adjustments, and bills receivable. Activities that you define appear as list of values choices in various Receivables windows. You can define as many activities as you need.

21) Name the profile option, which allows for creating charge-back and adjustment transactions?

If the profile option AR: Cash – Allow Actions is set to No, the Chargebacks and Adjustments buttons are not available in the Applications window

22) What is the relevance of Distribution set in AR?

Define distribution sets to account for your non–invoice related receipts. These receipts can include refunds, revenue from the sale of stock, as well as interest and investment income. Receipts that are not related to an invoice are known as Miscellaneous Transactions in Receivables.

23) Can we define Exception for a rate-based tax? If yes, explain.

No,Use the Item Tax Rate Exceptions window to assign special tax rates to products that you ship to specific authorities.

You can only define a tax rate exception for items that can be entered on an invoice and have a status of ’Active.’

Item tax rate exceptions apply only to location based tax. Therefore, to use tax rate exceptions, your Location Flexfield Structure must be State.County.City. To use the exceptions that you define in this window, ensure that the system option Use Item Tax Rate Exceptions is set to Yes.

25) Explain the relevance of Remit-To-Address?

Define remit–to addresses to let your customers know where to send payment for their invoices. Receivables uses the addresses that you define in the Remit To Addresses window to provide default remit–to information when you enter transactions.

If you use AutoInvoice but have not defined a remit–to address for a location, AutoInvoice will reject all invoices for which it could not determine a remit–to address.

26) Explain the Risk Elimination Day’s option?

The debt will be cleared by the Automatic Clearing program y days after each receipt’s maturity date, where y is the number of risk elimination days defined for the payment method/bank account combination assigned to the receipt.

27) Is it mandatory to define a customer profile class?

Yes, Customer profile class A category for your customers based on credit information,

payment terms, currency limits, and correspondence types.

Topic: Multi-Org, Inventory, HRMS, Purchasing

1.Explain the features and advantages of Multi-Org structure?

2.What is the hierarchy of Multi-Org structure? Explain each component.

3.List the key Flexi-fields of Oracle Inventory?

Item catalogs

Item categories

System items

Stock locators

Sales orders

Account aliases

Oracle service item flexi field

4.what is position hierarchy and which repost w.r.t positions has to run in purchasing?

The position hierarchy to show the who are the superiors and subordinators and their having positions.

Report name is “Fill Employee Hierarchy”

5.Is it mandatory to define approved suppliers?

Approved suppliers is optional but if we are select the check box use approved supplier under purchasing region while defining master items. Then it is mandatory to the defined master item.

6.List any six tab pages of payables options?

1. Invoice
2. With holding tax
3. Transfer to gl
4. Currency
5. Accounting methods
6. Suppliers
7. Matching
8. Interest
9. Payment
10. Invoice tax
11. Expense report
12. Payment accounting
13. Tax defaults and rules
14. Reports

7.what are the default segments in item category key flex field and what type of value sets they are assigned with?

• Family
• Class

Independent value sets to assigned to family

Dependent value sets to assigned to class

8.What are the different ‘pay date bases’ and explain each

Due

Discount

9.What are the mandatory profile options used in Multi-Org?

MO: Security profile

HR: Security Profile

MO: Operating Unit

HR: User Type

GL set of books Name

10.What is ‘price Break’ and what are the different types of price breaks?

11.What do you mean by category set? And what is its relevance?

12.What are three different types of information that are to be provided while defining inventory organization?

13.What are different types of installment?

14.What are the Accounts defaults to ‘supplier’ from ‘financial options’?

15.Whether Approval group will assign to position or job?

16.What are different parameters to select while defining an operating unit?

17.List the tab pages of financial options

18.Explain the concept of Cut-off day pay terms.

19.What are different object types on approval group?

20.What is the difference between Purchase Price variance account and Invoice price variance account?

21.What is the relevance of terms date basis? Where to select this option?

22.What are different types of Distribution sets and explain each in brief

Topic: Purchasing

1.What are different documents that can be created by using ‘Auto create’ based on Requisition?

The 4 types of documents are created by using auto create based on requisition.

The following documents are

1. Standard Purchase order


2. Blanket release


3. Planned Purchase order


4. RFQ

2.What are different types of Requisitions? Explain each in brief.

Internal Requisitions

Unlike purchase requisitions, which are supplied from purchase orders, internal requisitions are supplied from internal sales orders. Internal requisitions are not picked up when you Auto Create RFQs or purchase orders, nor can they be assigned to a buyer in the Assign Requisitions window

Purchase Requisitions

Use the Requisitions window to create requisitions. You must choose the requisition type (internal or purchase). You can also provide a description, unlimited notes, and defaults for requisition lines. For each requisition line, you choose the item you want to order along with the quantity and delivery location. You can get sourced pricing from catalog quotations or open blanket purchase agreements. You can also choose a price from a list of historical purchase order prices. In the Distributions window, you can charge the item to the appropriate accounts, or you can let the Account Generator create the accounts for you. Once you complete the requisition, you send it through the approval process.

3.What are different types of RFQ’s? Explain each in Brief.

There are three types of RFQs that come with Purchasing by default:

• Catalog: Used for high–volume items or items for which your supplier sends you information regularly. A Catalog or RFQ also includes price breaks at different quantity levels.

• Standard: Used for items you’ll need only once or not very often, but not necessarily for a specific, fixed quantity, location, and date. For example, you could use a Catalog RFQ for office supplies, but use a Standard RFQ for a special type of pen you don’t order very often. A Standard RFQ also includes price breaks at different quantity levels.

• Bid: Used for a specific, fixed quantity, location, and date. For example, a Bid would be used for a large or expensive piece of equipment that you’ve never ordered before, or for an item that incurs transportation or other special costs. You cannot specify price breaks for a Bid RFQ.

4.What are different types of purchase orders? Explain each in brief.

Purchase Order Types

Purchasing provides the following purchase order types: Standard Purchase Order, Planned Purchase Order, Blanket Purchase Agreement, and Contract Purchase agreement. you can use the Document Name field in the Document Types window to change the names of these documents. For example, if you enter Regular Purchase Order in the Document Name field for the Standard Purchase Order type, your choices in the Type field in the Purchase Orders window will be Regular Purchase Order, Planned Purchase Order, Blanket Purchase Agreement, and Contract Purchase Agreement.

Standard Purchase Orders

You generally create standard purchase orders for one–time purchase of various items. You create standard purchase orders when you know the details of the goods or services you require, estimated costs, quantities, delivery schedules, and accounting distributions. If you use encumbrance accounting, the purchase order may be encumbered since the required information is known.

Blanket Purchase Agreements

You create blanket purchase agreements when you know the detail of the goods or services you plan to buy from a specific supplier in a period, but you do not yet know the detail of your delivery schedules. You can use blanket purchase agreements to specify negotiated prices for your items before actually purchasing them.

Blanket Releases

You can issue a blanket release against a blanket purchase agreement to place the actual order (as long as the release is within the blanket agreement affectivity dates). If you use encumbrance accounting, you can encumber each release.

Contract Purchase Agreements

You create contract purchase agreements with your suppliers to agree on specific terms and conditions without indicating the goods and services that you will be purchasing. You can later issue standard purchase orders referencing your contracts, and you can encumber these purchase orders if you use encumbrance accounting. 4 – 5 Purchase Orders

Planned Purchase Orders

A planned purchase order is a long–term agreement committing to buy items or services from a single source. You must specify tentative delivery schedules and all details for goods or services that you want to buy, including charge account, quantities, and estimated cost.

Scheduled Releases

You can issue scheduled releases against a planned purchase order to place the actual orders. If you use encumbrance accounting, you can use the planned purchase order to reserve funds for long term agreements. You can also change the accounting distributions on each release and the system will reverse the encumbrance for the planned purchase order and create a new encumbrance for the release.

5.What are five different Tax defaults in Purchasing options?

1. Financial options


2. Ship-to location


3. Item


4. Supplier site


5. Supplier

6.What is the difference between Contract purchase Agreement and Planned purchase Agreement?

Contract Purchase Agreement:

You create contract purchase agreements with your suppliers to agree on specific terms and conditions without indicating the goods and services that you will be purchasing. You can later issue standard purchase orders referencing your contracts, and you can encumber these purchase orders if you use encumbrance accounting.

Planned Purchase Agreement:

A planned purchase order is a long–term agreement committing to buy items or services from a single source. You must specify tentative delivery schedules and all details for goods or services that you want to buy, including charge account, quantities, and estimated cost. You can later issue schedule release.

7.What do you mean by requisition Template? How to copy a requisition template to requisition?

A feature that lets you define a list of commonly purchased items from which a requestor can create a requisition. You can define the list of items by referencing an existing purchase order. Requestors use the requisition template to create simple, pre–sourced requisitions.

The requisition template are selected in requisition form click (B) catalog. In this form we are given requisition template number.

8.What is the difference between standard Purchase order and Blanket release?

Standard Purchase order:

You generally create standard purchase orders for one–time purchase of various items. You create standard purchase orders when you know the details of the goods or services you require, estimated costs, quantities, delivery schedules, and accounting distributions. If you use encumbrance accounting, the purchase order ay be encumbered since the required information is known.

Blanket release:

You can issue a blanket release against a blanket purchase agreement to place the actual order (as long as the release is within the blanket agreement affectivity dates). If you use encumbrance accounting, you

can encumber each release.

9.Explain the different match approval levels?

Two–Way: Purchase order and invoice quantities must match within tolerance before the corresponding invoice can be paid.

Three–Way: Purchase order, receipt, and invoice quantities must match within tolerance before the corresponding invoice can be paid.

Four–Way: Purchase order, receipt, inspection, and invoice quantities must match within tolerance before the corresponding invoice can be paid.

10.What do you mean by Receiving Controls?

11.What are different statuses of RFQ?

1. Active


2. Closed


3. In process

12.What type of RFQ’ s can be auto-created based on Requisition?

1. Standard


2. Catalog


3. Bid

13.What are different invoice match Options?

1. Purchase order


2. Receipt

14.List the different types of Quotations that can be auto-copied from RFQ?

This is depends on base document. If we are select the standard RFQ then it will create Standard (or) Catalog Quotations. Otherwise we are selected Bid RFQ it will create only Bid Quotation.

15.At what level below things are specific in Multi-Org structure:

1. Category codes : Global


2. Category sets : Inventory Org


3. Approval Assignment : Inventory Org


4. Location : Global


5. Approved Supplier : Inventory Org


6. Approval Group : Inventory Org


7. Supplier Site : Operating Unit


8. Bank : Global


9. Master Item : Inventory Org


10. Supplier List : Operating Unit

1.What are different types of invoices?

1. Credit Memo. An negative amount invoice you receive from a supplier representing a credit for goods or services purchased.


2. Debit Memo. A negative amount invoice you send to notify a supplier of a credit you recorded for goods or services purchased.


3. Interest. An invoice that Payables automatically creates invoices to pay interest for overdue invoices if you enable automatic interest calculation for a supplier, and if you pay an overdue invoice for the supplier in a payment batch or with a Quick payment.


4. Expense Report. An invoice you enter to record business–related employee expenses.


5. Mixed. A Standard or Credit/Debit Memo invoice for which you can enter both positive and negative amounts and perform both positive and negative matching.


6. PO Default. A trade invoice you want to automatically match to a specified purchase order and then manually match to the individual shipments on the purchase order. After you use this invoice type to complete the match, the invoice will become a Standard type invoice.


7. Prepayment. An advance payment you make to a supplier or employee. If you enter Temporary for the Prepayment Type field, then you can later apply prepayment to an invoice.


8. QuickMatch. A trade invoice you want to automatically match to all the shipments of a specified purchase order.


9. Standard. A trade invoice you receive from a supplier.


10. Withholding Tax. An invoice you have generated to pay a tax authority.

2.What is Pre-payment invoice? What are the different types of Pre-payment invoice? What is the accounting entry for Pre-payment at different stages?

Prepayment. An advance payment you make to a supplier or employee. If you enter Temporary for the Prepayment Type field, then you can later apply prepayment to an invoice.

Two types of prepayments are there, namely, Temporary and Permanent. In case of earlier one, it is treated as advance to the supplier and will be adjusted against any invoice on or after the settlement date but in case of later one, it is treated as deposit with the supplier.

4.Explain the concept of ‘Pay Group”. Brief the steps to define and assign ‘Pay Group’.

Pay Group you want to assign to any suppliers that you create from employees during Invoice Import. You can define additional values for Pay Group in the Purchasing Lookups window.

Purchasing Lookups

Note that in the Oracle Public Sector Purchasing Lookups window you can add values for the following lookups that Payables uses:

1. FOB


2. Freight Terms.


3. Minority Group


4. Pay Group. Groups invoices in payment batches.


5. Supplier Type.

Define pay group ay lookups-purchasing. It can be assigned at payable option - supplier tab page, supplier screen - payment tab page and supplier site - payment tab page.

5.What is the difference between PO default and Quick Match Invoices?

If you know the number and amount of the purchase order to which you want to match, Payables provides you with two invoice types, PO Default and QuickMatch, to help speed up invoice matching.

Enter PO Default as the invoice type if you know the 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 copies the supplier name, supplier number, supplier site, and currency from that Purchase order to the invoice. When you choose the Match button, Payables will retrieve all purchase order shipments or receipt lines associated with the specified purchase order. You can then match to any shipment, distribution, or receipt line.

Enter Quick Match as the invoice type if you want to match an invoice to all shipments or receipt lines 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 navigates to the match window, and selects all shipments that have an unbilled quantity. You can choose to complete the match or override the matching information.

6.What do you mean by Mixed Invoice?

Mixed Invoices are invoices or credit/debit memos for which you can perform both positive and negative matching to purchase orders and to other invoices.

For example, you can enter an invoice for –$100 with Invoice Type Mixed. You can match to an invoice for $–200, and match to a purchase order for $100.

To enter a Mixed invoice:

1. Enter the invoice or credit/debit memo in the Invoices window, and enter Mixed as the invoice Type.You can enter either a positive or negative invoice amount.

2. Match to purchase orders, and/or invoices

7.What are the different payment methods?

Payment Method.

Ø Check. Payment in a payment batch, Quick payment, or manual payment.

Ø Electronic. You pay electronic payments either through the e–Commerce Gateway, or by delivering a payment batch file to your bank. For both methods, Payables creates a file during payment batch creation. For e–Commerce Gateway payments, the file is processed through the e–Commerce Gateway and delivered to your bank to create payments. For electronic funds transfers, the file is formatted and delivered to your ap.out directory for you to deliver to your bank.

Ø Wire. A payment method where you pay invoices outside of Payables by notifying your bank that you want to debit your account and credit your supplier’s account with appropriate funds. You provide your bank with your supplier’s bank information, and your bank sends you confirmation of your transaction. Your supplier’s bank sends your supplier confirmation of the payment. You then record the transaction manually.

Ø Clearing. Payment method you use to account for interfund expenses when you do not actually disburse funds through banks. Generally, you do not generate a payment document with the Clearing payment method

8.What is cash clearing account? And when it will be used?

Cash Clearing. If you have enabled the Account for Payment When Payment Clears Payables option, enter the cash clearing account you are associating with a payment document. When you create a payment, Payables creates accounting entries for your unreconciled invoice payments to credit this cash clearing account using this account. After you reconcile your invoice payments using Oracle Cash Management, Payables creates accounting entries to debit this cash clearing account and credit this bank account’s cash account. The account you enter here overrides the Cash Clearing Account you entered in the GL Accounts region of the Bank Accounts window.

For future dated payments, when the payment is recorded as mature, Payables debits the future dated payment account and credits the cash clearing account. When you reconcile the payment, Payables debits the cash clearing account and credits the cash account.

9.What is payment format and what is it used for?

Payment Format. The format you want Payables to use to format payments for a payment document.

If you enable the Use Multiple Currencies Payables option, select your functional currency as your bank currency, and define your bank account as multiple currency, you can select any of the payment formats you defined, whether they are multiple currency or not. If you do not define your bank account as multiple currency, you can only select formats that are defined in the same currency as your bank account.

10.What is distribution hold? Can it be released manually?

Hold In Oracle Payables, an Oracle Applications feature that prevents a transaction from occurring or completing until the hold has been released. You can place a hold on an invoice or an invoice schedule line. All holds in Payables prevent payment; some holds also prevent posting to your general ledger.

Distribution hold arises due to imbalance of distribution total, this can be released only by correcting the distribution total. No, it cant be released manually from action window, as we have to correct the entry.

11.What is the selection criteria for concurrent program ‘payables approval’ to approve the invoices?

Parameters: Option, Invoice Batch Name, From Invoice date, to Invoice date, Supplier Name, Pay Group, Invoice Number, Entered By.

12.List the different ways of payment to invoices.

Through Invoice Work Bench & Payment Workbench

13.What are the different statuses of pre-payment invoice? What is the relevance of settlement date?

1. Never approved


2. Unapproved


3. Unpaid


4. Available – Temporary


5. Fully Applied - Temporary


6. Permanent


7. Cancelled

Settlement Date The date before which you cannot apply a prepayment to an invoice. Payables prevent you from applying a temporary prepayment to an invoice until on or after the Settlement Date of the prepayment.

14.When I am trying to enter an invoice, ‘NEW’ button is disabled. What could be the reason for that?

If you checked the Use batch control Check box at Invoice tab Page in Payables Option ‘NEW’ button disabled.

15.Can I assign a supplier type of bank account to more than one supplier?

Yes,

Allow Assignment to Multiple Suppliers: Enable this option if your bank account belongs to an organization that receives payments for multiple suppliers (a factor organization). With this option enabled, Payables allows you to enter any combination of suppliers and sites in the Supplier Assignments region. It will make the account always available in the list of values for the fields (Bank) Name and (Bank) Number in the Bank Accounts region of the Suppliers and Suppliers Sites windows.

16.What is the request name to view the list of Credit memos?

The Concurrent program is Credit Memo Matching Report.

Parameters: Supplier From, Supplier To, Begin Credit Memo date and End Credit memo date.

17.List the different bank accounts uses in oracle payables.

1. Internal

2. Customer

3. Supplier

18.Even though I have defined a supplier and supplier site, I am not able to enter an invoice for that. Why?

If you are not checking the circled item in supplier site level.

19.On what basis Oracle payables caution the user while entering a Debit memo/Credit memo, as it is a Duplicate.

Those bases are, namely,

1. Supplier
2. Supplier site
3. Currency
4. Amount