his document covers the following

A. Business Case                                                                                                      

1)      Creation of Items

2)      Setting up Selling Price for an Item                                                                   

3)      Define Customer                                                                                     

4)      Creation of Sales Order                                                                         

5)      Enter Item Costs                                                                                     

6)      Define Resources                                                                                               

7)      Define Departments                                                                               

8)      Define Routing (CPU Sub assembly)                                                     

9)      Define Bill of Materials (BOM) CPU Sub assembly                            

10)  Define Routing (Dell Computer)                                                

11)  Define Bill of Materials (BOM)  (Dell Computer)                               

12)  Define Suppliers                                                                                     

13)  Enter Purchase Requisitions                                                                  

14)  Create Purchase Orders                                                                         

15)  Enter Receipts (Inventory Receipt)                                                                  

16)  Auto-create Supplier Invoice                                                                             

17)  Create, View Invoices and Make Payments in Payables                                 

18)  Payments Reconciliation                                                                        

19)  Create, Release, Complete, Close Discrete Job for CPU Subassembly         

20)  Create, Release, Complete, Close Discrete Job for Dell Computer               

21)  Sales Order Booking, Releasing, Ship Confirm the Finished Goods               

22)  Run Auto invoice                                                                                    

23)  View Sales Invoice, Create Receipt, Remittance and view Account Balances

24)  Receipt Reconciliation                                                                           

 

This Document has been broken to three parts owing to the size of the document is very huge. Hence

readers are requested to read the Document Links in the following Sequence to understand the complete

flow of Transactions

Procure to Pay CyclePosted by prudhviArticles, General, Payables, Process FlowsAdd comments 

In this article, we will see the steps involved in Procure to Pay Cycle. Here is

the diagrammatic representation:

1) Create Requisition:

Requisition is nothing but a formal request to buy something (like Inventory

material, office supplies etc) needed for the enterprise. Only an employee

can create one. There are two types of requisitions:

Internal Requisition: Internal requisitions provide the mechanism for

requesting and transferring material from one inventory to other inventory.

Purchase requisition: Unlike Internal requisitions, Purchase requisitions are

used for requesting material from suppliers.

Navigation: Purchasing Vision Operations (USA) > Requisitions > Requisitions

Choose the requisition type and enter the Item, quantity, Price details in the

Lines tab.

In Source Details tab, specify the Buyer name.

Click the Distributions button. Enter the Charge Account.

Save the work. The status of the requisition will now be “Incomplete”. And

now the Approve button is highlighted. The requisition needs to be approved

first before proceeding further by the concerned authority. Submit this

requisition for Approval by clicking on the Approve button. The status will

now be updated to “In Process” .The workflow then will send an Approval

notification to the concerned person (derived based on hierarchy used—

Position or Supervisor hierarchy) using which he can Approve or Reject the

requisition.

At any time the status of requisition can be checked using the Requisition

summary window.

Navigation: Requisitions > Requisition Summary

Enter requisition number and click on the find button.

We can also check the Action History of requisition (it will show details about

who has submitted, approved and cancelled the requisitions) as below:

Navigation: Tools menu > Action History.

Underlying Tables:

PO_REQUISITION_HEADERS_ALL

PO_REQUISITION_LINES_ALL

PO_REQ_DISTRIBUTIONS_ALL

2) Create Purchase Order:

There are 4 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 for creating a standard PO: Purchase Orders > Purchase Orders

Choose type as Standard Purchase Order. Enter the Supplier, Buyer. In the

Lines tab, specify the line number, line type, Item, quantity, price etc.

Click Terms to enter terms, conditions, and control information for purchase

orders.

Click Currency button to enter and change currency information for purchase

orders, RFQs, and quotations.

Click Shipments button to enter multiple shipments for standard and planned

purchase order lines Purchase order shipment specifies the quantity, ship–to

organization and location, date you want your supplier to deliver the items

on a purchase order line, and country of origin for the items. When you save,

Purchasing creates distributions depending on the default information

available.

To enter more shipment information, select the More tab.

Enter the Receipt Close Tolerance percent, Invoice Close Tolerance

percent to set the receiving and invoice close point.

Select one of the following options for Match Approval Level:

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, accepted, and invoice quantities must

match within

tolerance before the corresponding invoice can be paid.

Select an Invoice Match Option:

Purchase Order: Payables must match the invoice to the purchase order.

Receipt: Payables must match the invoice to the receipt.

Save the work.

Click the Receiving Controls button to enter receiving control information for

purchase orders.

- Enter the maximum acceptable number of Days Early and Days Late for

receipts.

- Enter the Action for receipt date control.

- Enter the maximum acceptable over–receipt Tolerance percent (receipts

that exceed the quantity received tolerance).

- Enter the Action for Overreceipt Quantity.

- Select Allow Substitute Receipts to indicate that receivers can receive

substitute items in place of ordered items.

- Enter the default Receipt Routing that you assign goods: Direct Delivery,

Inspection Required, or Standard Receipt.

- Enter the Enforce Ship To location option to determine whether the

receiving location must be the same as the ship–to location.

Save the work.

Click Distributions button to enter distributions for the shipments.

Select more tab to enter more details and the requisition number (optional).

Save the work.

Click on the Approve button to initiate the Approval process.

Underlying Tables:

PO_HEADERS_ALL

PO_LINES_ALL

PO_DISTRIBUTIONS_ALL (REQ_HEADER_REFERENCE_NUM in Distributions

table is the Requisition number for this PO)

3)Create Receipt:

Create a receipt to receive the items in the Purchase Order.

Navigation: ReceivingàReceipts

Enter the PO Number and select find button.

Go to Lines, check the lines you want to receive in the PO.

Click on Header button and Save which creates the receipt.

Receipt Tables are:

RCV_SHIPMENT_HEADERS

RCV_SHIPMENT_LINES (Lines Table has PO_HEADER_ID)

4) Create Invoice in Payables:

Once the goods are received, it’s time to pay the vendor for the goods

purchased and hence the invoices are created.

Navigation: Payables, Vision Operations (USA) > InvoicesàEntryàInvoices

Enter type — Standard, supplier information and amount.

Click the Match button to match to either Purchase Order or Receipt

(depending on the Invoice Match option specified on the PO) and avoid

manually entering the invoice.

Enter the PO Number you want match to and click Find.

Select the lines required and click on Match button.

Click on Distribute button

to navigate to the Match to Purchase Order Distributions window.

This creates the invoice and you can see the status of the invoice as “Never

Validated”. it has to be Validated and Accounted before you can pay it.

Validating the Invoice:

Click on Actions Button and Select “Validate”. Click on OK button.

Now you can see the status of the invoice as “Validated”, if there are no

issues during validation.

Create Accounting Entries:

Click on Actions Button and Select “Create Accouting”. Click on OK button.

Now we can see the Accounted status as “Yes”.

You can see the Accounting Entries here:

Tools àView Accounting

Invoice Tables:

AP_INVOICES_ALL

AP_INVOICE_DISTRIBUTIONS_ALL

Accounting Entries Tables:

AP_ACCOUNTING_EVENTS_ALL

AP_AE_HEADERS_ALL

AP_AE_LINES_ALL

5)Making a Payment:

Go to the Invoice window and query the invoice you want to pay. You would

see Amount paid as 0.00 before you make a payment.

Click Actions button. Select “Pay in full” and click “OK”.

Select the Bank Account and Document. Save the Work.

Now that the payment is made, when you query for the invoice in Invoice

window, you will the Amount Paid as $4,000.00.

Create Accounting entries for payment.

Click Actions and select “Create Accounting”

Select the void checkbox to cancel the payment.

View Accounting Entries:

In the Payments window, query for the payment.

Tools menuàView Accounting

Payment Tables:

AP_INVOICE_PAYMENTS_ALL

AP_PAYMENT_SCHEDULES_ALL

AP_CHECKS_ALL

AP_CHECK_FORMATS

AP_BANK_ACCOUNTS_ALL

AP_BANK_BRANCHES

AP_TERMS

You can also pay the invoices using Payment Batch screen. Refer to the

article “Make AP Payments through Payment Batches”

6) Transfer to General Ledger:

Navigation: Payables Responsibility > View Requests

Run the concurrent program “Payables Transfer to General Ledger” with the

required parameters.

Journal Import:

Refer to the Article “Order to Cash Cycle”.