Chapter 3. Paying Supplier Invoices in Payables

In this chapter, we will cover:

• Entering invoices

• Entering a prepayment

• Entering credit memos

• Applying holds to an invoice

• Canceling an invoice

• Paying invoices

• Creating a payment process template

• Voiding a payment

• Reviewing payables accounting transactions

Invoices for goods and services that are purchased in an organization are sent from the supplier, and payments are made to the suppliers based on the amount on the invoice. In this chapter, we will look at how to enter and pay supplier invoices in payables. Let's start by looking at the payables process.

The following diagram summarizes an example of the payables process:

1. 1. The Payables Administrator enters the invoice in Oracle Payables. Invoices can also be automatically generated by other sources, for example, through the invoice open interface, from XML files, self-billing programs, and scanned images.

2. 2. The entered invoices are matched to the purchase order or receipt details.

3. 3. The invoice is...

Entering invoices

Oracle Payables provides us with the functionality to enter invoices from suppliers. An invoice contains the description of the goods supplied and/or service provided to the organization.

In this recipe, we will create a standard invoice and match it to a purchase order. We will also add an additional line for freight charges and tax. The main tasks are as follows:

• Match to purchase order 6059-2 Paper Widgets at $50 each

• Enter Freight Charges for $20 (includes tax)

• Calculate the tax added to the invoice

The total invoice value is $128.60.

Note

Invoices can also be matched to multiple Purchase Orders.

Getting ready

Log in to Oracle E-Business Suite R12 with the username and password assigned to you by the system administrator. If you are working on the Vision demonstration database, you can use OPERATIONS/WELCOME as the USERNAME/PASSWORD.

We also need an approved Purchase Order (PO) with some Items receipted on the system.

How to do it...

Let's look at the steps required to enter...

Entering a prepayment

A prepayment is an advance payment made to a supplier. A prepayment can be Temporary (can be applied to invoices) or Permanent (cannot be applied to invoices). In this recipe, we will create a prepayment to Office Supplies, Inc for cleaning services.

Getting ready

Log in to Oracle E-Business Suite R12 with the username and password assigned to you by the system administrator. If you are working on the vision demonstration database, you can use OPERATIONS/WELCOME as the USERNAME/PASSWORD.

How to do it...

Let's list the steps required to enter a prepayment:

1. 1. Select the Payables responsibility.

2. 2. Navigate to Invoices | Entry | Invoices.

3. 3. In the invoice Type field, select Prepayment.

4. 4. Enter Office Supplies, Inc in the Trading Partner field.

5. 5. Select NEW YORK as the Supplier Site.

6. 6. Enter the Invoice Date, for example, 17-DEC-2010.

7. 7. Enter the unique Invoice Number from the Supplier, for example, OS-172011.

8. 8. Enter the Invoice Amount of 50.

9. 9. Scroll to the right using...

Entering credit memos

Credit memos are credit invoices from a supplier representing a credit toward goods or services. Credit memos are also called credit notes.

Debit memos are invoices entered to record a credit for a supplier, where a credit memo is not received from the supplier. They can be netted with an invoice, when the invoice is paid. The steps for creating a debit memo are similar to creating a credit memo. We will look at how to enter a credit memo in this recipe.

Getting ready

Log in to Oracle E-Business Suite R12 with the username and password assigned to you by the system administrator. If you are working on the Vision demonstration database, you can use OPERATIONS/WELCOME as the USERNAME/PASSWORD.

How to do it...

Let's list the steps required to enter a credit memo:

1. 1. Select the Payables responsibility.

2. 2. Navigate to Invoices | Entry | Invoices.

3. 3. In the invoice Type field, select Credit Memo.

4. 4. Enter Office Supplies, Inc in the Trading Partner field.

5. 5. Select NEW YORK...

Applying holds to an invoice

In this recipe, we will assume that the supplier has sent in an invoice for four paper widgets at $75 each for purchase order number 6059. We have only received five paper widgets and we have previously been billed for two paper widgets. This should generate two system holds when we try to validate the invoice:

• Qty Rec: Quantity billed exceeds quantity received

• Price: Invoice price exceeds purchase order price

Let's also assume that the supplier has not submitted all the documents required, for example, insurance certificates and so on. We will place a manual hold on the invoice to reflect this. We will also look at how to resolve the holds.

Let's create a standard invoice and match it to the purchase order.

Getting ready

Log in to Oracle E-Business Suite R12 with the username and password assigned to you by the system administrator. If you are working on the Vision demonstration database, you can use OPERATIONS/WELCOME as the USERNAME/PASSWORD.

How to do it.....

Canceling an invoice

It is possible to enter an invoice in error, and we need to cancel the invoice. In this recipe, we will cancel invoice number OS-172018. An audit trail is maintained on the system for the canceled invoice.

Getting ready

Log in to Oracle E-Business Suite R12 with the username and password assigned to you by the System Administrator. If you are working on the Vision demonstration database, you can use OPERATIONS/WELCOME as the USERNAME/PASSWORD.

How to do it...

Let's list the steps required to cancel an invoice:

1. 1. Select the Payables responsibility.

2. 2. Navigate to Invoices | Entry | Invoices.

3. 3. Find the invoice based on Invoice Number OS-172018.

4. 4. Click on the Actions…1 button.

5. 5. Click on the Cancel Invoices checkbox.

6. 6. Click on the OK button.

7. 7. Click on the OK button on the displayed note.

8. 8. The invoice is now canceled.

Paying invoices

Once invoices are due, the amounts due are paid to the supplier. In this recipe, we will pay invoices due to ACME General Electric.

Getting ready

Log in to Oracle E-Business Suite R12 with the username and password assigned to you by the system administrator. If you are working on the Vision demonstration database, you can use OPERATIONS/WELCOME as the USERNAME/PASSWORD.

We need validated invoices that are due for payment. For this recipe, we have a payment due to ACME General Electric for $220.

How to do it...

Let's list the steps required to pay invoices:

1. 1. Select the Payables responsibility.

2. 2. Navigate to Payments | Entry | Payments Manager.

3. 3. Select the Payment Process Request tab. The page is used to view, submit, and schedule requests.

4. 4. Click on the Submit Payment Process Request button. This is used to submit a single request for payment.

5. 5. To schedule a payment process to run periodically, use the Schedule Repeating Request button.

6. 6. In the Payment Process Request...

Creating a payment process template

The Payments Manager uses payment process request templates to simplify a payment run. The template includes information such as invoice selection criteria, payment attributes, processing instructions, and also defines how validation failures should be handled. It is useful for automatically selecting invoices to pay during a payment run. In this recipe, we will create a Payment Process template.

Getting ready

Log in to Oracle E-Business Suite R12 with the username and password assigned to you by the system administrator. If you are working on the Vision demonstration database, you can use OPERATIONS/WELCOME as the USERNAME/PASSWORD.

How to do it...

Let's list the steps required to create the template:

1. 1. Select the Payables responsibility.

2. 2. Navigate to Payments | Entry | Payments Manager.

3. 3. Select the Templates tab.

4. 4. Click on the Create button.

5. 5. Enter the unique Name of the template, for example, ACME Check Payments.

6. 6. Enter a Description, for example...

Voiding a payment

A payment may need to be canceled or voided. Let's look at how to void a payment.

Getting ready

Log in to Oracle E-Business Suite R12 with the username and password assigned to you by the system administrator. If you are working on the Vision demonstration database, you can use OPERATIONS/WELCOME as the USERNAME/PASSWORD.

How to do it...

Let's list the steps required to void a payment:

1. 1. Select the Payables responsibility.

2. 2. Navigate to Payments | Entry | Payments Manager.

3. 3. Select the Payments tab.

4. 4. Enter ACME General Electric in the Payee field and 220 in the Payment Amount.

5. 5. Click on the Go button.

6. 6. Click on the Void icon for the 8388 Payment Reference.

7. 7. Enter a reason, for example, Duplicate payment.

8. 8. Click on the Apply button.

9. 9. A warning message is displayed. Click on the Yes button to accept the action to void the payment.

10. 10. The payment Status is now Void.

There's more...

Now let's look at how to stop a payment.

Stopping a payment

A stop payment needs to be...

Reviewing payables accounting transactions

In this recipe, we will transfer transactions to the General Ledger and review the accounting transactions generated.

Getting ready

Log in to Oracle E-Business Suite R12 with the username and password assigned to you by the System Administrator. If you are working on the Vision demonstration database, you can use OPERATIONS/WELCOME as the USERNAME/PASSWORD.

We need validated invoices for this recipe.

How to do it...

Let's list the steps required to transfer accounting transactions to the General Ledger from the Invoice Workbench:

1. 1. Select the Payables responsibility.

2. 2. Navigate to Invoices | Entry | Invoices.

3. 3. Search the Invoice Number GE-030111 for $220 from ACME General Electric on 01-JAN-2011 in the Invoice Workbench.

4. 4. Click on the Actions…1 button.

5. 5. Click on the Create Accounting checkbox and select Final Post option.

6. 6. Click on the OK button. A note will be displayed to confirm that the accounting transactions have been generated.

7. 7. View the...