Monday, March 23, 2015

Briefly about Accounts Payables and FAQs

Invoices:Invoices is a formal document to pay to vendor. Upon shipment of goods invoices are normally sent by suppliers and same is entered in payable's module. You can manipulate(create,edit,adjust) group of invoices or invoices batches in invoices workbench.
Invoices can be manually entered or automatically imported from purchasing,EDI or Interface.

Types of Invoices:

Standard
Credit Memo
Debit Memo
Expense Report
Prepayments
Retainage Release
Transportation Invoice
Withhold Tax
Mixed.

Credit Memo and Debit Memo: Credit Memo is a negative amount invoice given by supplier to give a credit. Debit Memo is a negative amount invoice created by you and sent to supplier.

Invoice Holds: Holds are applied to prevent payments to suppliers

Payments: For each eligible Invoice or invoice lines, payments are created.

Prepayments in Oracle Payables:

Normal Payable cycle is that you first create invoice when you get one from you supplier for the goods that you have bought and then make a payment of the amount in the invoice to the supplier.
But there are scenarios where the supplier requests for an advance when you order the goods. Supplier wants you to pay a certain amount at the time of order and then pay the remaining upon delivery of the goods.

You can enter two types of prepayments: Temporary and Permanent.

Temporary prepayments can be applied to invoices or expense reports you receive. For example, you use a Temporary prepayment to pay a hotel a catering deposit. When the hotel’s invoice arrives, apply the prepayment to the invoice to reduce the invoice amount you pay.

Permanent prepayments cannot be applied to invoices. For example, you use a Permanent prepayment to pay a lease deposit for which you do not expect to be invoiced.

Withholding Tax Invoices in Oracle AP:

Withholding tax (WHT) is the amount withheld while making a payment to a supplier/contractor/any payee. Instead it is paid to the tax authorities.

You may be required to withhold taxes from your employee expense reports and supplier invoices. Payables lets you to automatically withhold tax based on the certain conditions you specify in Withholding Tax region of the Payables Options window.

Retainage Release Invoices in Oracle AP:

Retainage means retaining certain amount of money with us without paying the supplier in full. The retained amount is released or paid to the supplier when all the terms of the agreement have been met or all the work is completed.

AP: Payment Manager Process in R12.

Payment Batch lets you create payments for multiple invoices that meet the criteria you specify in a single shot. In R12, it lets you select invoices with different Operating units, Currencies in a single batch.

Note: The process of creating payment batches and processing payments in R12 has changed completely when compared to 11i.

Navigation: Payables responsibility > Payments > Entry > Payment Manager.




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