Procure 2 Pay Life Cycle in R12

It is a complete Procure to Pay document which will help you:

• To Overview Procure to Pay complete process.

• To describe the Procure to Pay flow from Requisition creation to make payment and

transfer to General Ledger.

• To provide reference material and definitions with snapshots.

BY: Muhammad Irfan

Create Requisition

Requisition:Requisitions represent demand for goods or services.

The Purchase Requisition will be raised whenever an Item needs to be ordered from the Vendor.

Navigation: Purchasing Responsibility Requisitions

Requisitions

In Requisitions form enter following information

Select Operating Unit for the destination organization.

Select Type as Purchase Requisition.

Enter the description, if any for this requisition.

To select the item to be placed on requisition, click the Catalog button by keeping the cursor in the lines region.

Enter other required information as shown

Requisition Approval

After saving the requisition, click Approve button. This will send the requisition for approval as per Red highlighted.

After selecting the Approve button in Requisitions window, approve documents window opens.

Select the Submit for Approval checkbox to send the requisition for approval as per Red highlighted.

Create Purchase Order

Purchase Orders

Oracle Purchasing supports four types of purchase orders:

1. Standard PO: A Standard PO is created for one–time purchase of various items.

2. Planned PO: A Planned PO 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.

3. Blanket Agreement: A Blanket PO is created 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 know the detail of your delivery schedules.

4. Contract Agreement: Contract purchase agreements are created with your suppliers to agree on specific terms and conditions without indicating the goods and services that you will be purchasing.

Navigation:

Purchasing responsibility Auto create

All purchase requisitions will appear in the Auto create window of the buyer.

Auto Create Purchase OrderThere are several methods that can be used to create purchase orders. You can manually create purchase orders or search approved requisitions and add them to purchase orders. Here is Auto create purchase order.

In Find Requisition Lines window Operating Unit, Buyer and Approved status appears as yes.

Buyer can search the requisition lines that are to be placed on Purchase Order based on various criteria.

After searching the required requisition i.e. after selecting the Find button on Find Requisition Lines window, Auto create Documents window opens.

With the help of Auto create Documents window, you can create following documents:

Standard Purchase OrderBlanket ReleaseSourcing RFQ.

Automatic: For automatic creation mode use the checkboxes to select the requisition lines that you want to use on the document and then select automatic button. You can also use Select All or Deselect All in Edit Menu.

Manual: For manual creation mode select manual button. It is available only when you have chosen Default grouping for Standard Purchase Order, blanket releases and RFQs.

If you select manual creation mode, supplier is not defaulted. In case of automatic creation supplier is defaulted from requisition.

In New document window, Most of the fields defaults, you can enter global agreement number if you want to refer to any global agreement.

Once you click on Create button all requisition information is transferred to Purchase Order Form.

Enter all required details in:

• Lines Tab

• Price Reference

• Reference doc

• More tabs

Select Ship-To field carefully as this is required to create inventory receipt / purchasing receipt.

• Now PO being sent to Supplier , we can expect the products to be delivered to us. Once items / products are delivered to us we will create Receipt to record the details of the products received.

• We can create Receipt in purchasing module or inventory module.

Inventory Receipt

Receiving

Using Oracle Purchasing, you can process receipts from suppliers, receipts from other warehouses or inventory organizations, in-transit shipments and receipts due to customer returns. You can search for expected receipts based on a purchase order

Items Receiving

Navigation: Purchasing Responsibility > Receiving > Receipts

Receiving Items and Check Quantity in Inventory

By entering Purchase Order Number

Enable Quantity Receive

After saving click on Header

Submit Program for Pay on Receipt Auto invoice

From Purchasing Module

Make a note of Invoice Number

Create AP Invoice

Navigation: Invoices> Entry> Invoices

Invoice number can be Query or find from find

Window.

Enter Invoice Number

Validate Invoice

Enable Validate

Now Status of Invoice is validated

The Purchase Order is Automatically Match to Invoice and PO Number, Receipt Number and Quantity

Make Payment Against Invoices

Click on Actions then pay in Full

Payment completed

Create Accounting

Transfer To GL