(Oracle User & Implementation guides)
Oracle Receivables provides three integrated workbenches that you can use to perform most of your day-to-day Accounts Receivable operations. You can use the Receipts Workbench to perform most of your receipt-related tasks and the Transactions Workbench to process your invoices, debit memos, credit memos, on-account credits, chargebacks, and adjustments. The Bills Receivable Workbench lets you create, update, remit, and manage your bills receivable.
Each workbench lets you find critical information in a flexible way, see the results in your defined format, and selectively take appropriate action. For example, in the Transactions Workbench, you can query transactions based on the bill-to or ship-to customer, currency, transaction number, or General Ledger date. You can then review financial, application, and installment information, perform adjustments, create a credit memo, or complete the transaction. All of the windows you need are accessible from just one window, so you can query a transaction once, then perform several operations without having to find it again.
The Receipts and Transactions workbenches let you view records one at a time or as a group. Detail windows display only one receipt or transaction at a time, but provide more information about the record because they contain more fields and tabbed regions. Summary windows, by contrast, can display multiple records at once but require that you “drill down” to the detail window to view additional information about the current record. Following is a list of the available detail and summary windows within the Receivables Workbenches:
- Receipts Workbench: Receipts, Receipts Summary, Receipt Batches and Receipt Batches Summary
- Transactions Workbench: Transactions and Transactions Summary, Transactions Batches and Transaction Batches Summary
- Remittances / Remittances Summary
1. Assign MO Operating Unit and GL Ledger Name profile options
The ledger which we have created is required to be assigned to that responsibility which will make entries in that ledger. This profile is generally set at responsibility level because there may be multiple ledgers which are required to be set for different responsibilities.
Secondly we set operating unit profile option to restrict access to specific Operating Unit.
Navigation path: System Administrator>Profile>System
2. Define System Options
Define system options to customize your Receivables environment. During Receivables setup, you specify your accounting method, set of books, tax method and accounts, customer and invoice parameters, and how the AutoInvoice and Automatic Receipts programs will run.
If you want to enable the event-based revenue management feature, then specify your organization’s revenue policy.
If you are planning to use the Bills Receivable Workbench, then you must perform the necessary implementation steps and enable Bills Receivable.
- Define your set of books
- Define your AutoCash Rule sets
- Define Grouping Rules
- Define Key Flexfield Segments
Navigation path: Receivables>Setup>System Options
3. Define Payment Terms
Receivables lets you define standard payment terms for your customers to specify the due date and discount date for their open items. Payment terms can include a discount percent for early payment and you can assign multiple discounts to each payment term line. For example, the payment term ‘2% 10, Net 30’ indicates that a customer is allowed a two percent discount if payment is received within 10 days; after 10 days, the entire balance is due within 30 days of the transaction date with no applicable discount. You can define proxima payment terms to pay regular expenses such as telephone bills and credit card bills that occur on the same day each month. You can also create split payment terms for invoice installments that have different due dates.
You can use payment terms to determine the amount of each installment. Receivable lets you either distribute tax and freight charges across all installments or allocate all freight and tax amounts in the first installment of a split term invoice. You can use prepayment payment terms to indicate which business transactions require prepayment for goods and services. Receivables displays the active payment terms you define as list of values choices in the Customers, Customer Profile Classes, and Transactions windows.
Default Payment Terms Hierarchy:
Receivable uses the following hierarchy to determine the default payment term for your transactions, stopping when one is found:
- Bill-to site
- Customer Address
- Transaction Type
Predefined Payment Terms:
Receivables provides the following predefined payment terms:
- 30 NET: The balance of the transaction is due within 30 days.
- IMMEDIATE: The balance of the transaction is due immediately (i.e. on the transaction date). You can use this payment term with your chargebacks and debit memos.
Navigation path: Setup>Transactions>Payment Terms
4. Define Auto Accounting
Define AutoAccounting to specify how you want Receivables to determine the general ledger accounts for transactions that you enter manually or import using AutoInvoice. Receivables creates default accounts for revenue, receivable, freight, tax, unearned revenue, unbilled receivable, finance charges, bills receivables accounts and AutoInvoice clearing (suspense) accounts using this information.
You can control the value that AutoAccounting assigns to each segment of your Accounting Flexfield, such as Company, Division or Account.
You must define AutoAccounting before you can enter transactions in Receivables. When you enter transactions in Receivables, you can override the default general ledger accounts that AutoAccounting creates.
Navigation path: Receivables>Setup>Transactions>AutoAccounting
5. Territory 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 Receivables. Receivables provides a default structure for your Territory Flexfield. You can define up to twenty segments for this structure.
Once you have defined your Territory Flexfield segments, you need to define value sets for these segments. Receivable does not provide any default value sets.
Navigation path: Setup>Financials>Flexfields>Key>Segments
6. Define Sales Territory Values
After creating the Accounting Flexfield structure and their value sets, we have to add values for each value set.
Navigation path: Setup> Financials>Flexfields>Key>Values
7. Define Sales Territory Values Combinations
You need to navigate to the Territories window to create your Territory Flexfield combinations. The Territory Flexfield does not allow dynamic insert, so you must ensure that you have defined all of your flexfield combinations before you assign them.
You can assign territories to your salespeople in the Salespersons window, to invoices and commitments in the Transactions window, and to customer business purposes in the Customers window.
You can choose to default the Territory Flexfield in your invoices and commitments using the Source of Territory field in the Miscellaneous alternative region of the System Options window. You can choose from the following sources:
- Bill-To Site: Use the customer’s Bill-To address as the default Territory Flexfield.
- Salesrep: Use the Territory Flexfield assigned to your customer’s primary salesperson as the default.
- Ship-to Site: Use the customer’s ship-to address as the default Territory Flexfield.
- None: Choose this value if you do not want Receivables to provide a default Territory Flexfield.
Navigation path: General Ledger>Setup>Financials>Flexfields>Key>Values
8. Define Approval Limits
Use the Approval Limits window to define approval limits for adjustments created in Receivables, requests for credit memos initiated from iReceivables and write-offs for receipts.
When you enter an adjustment that is outside your approval limit range, Receivables assigns the adjustment a status of Pending until someone with the appropriate approval limits either approves or rejects it.
Receivable uses approval limits that have a document type of Adjustment when you create an adjustment in the Adjustments, Submit AutoAdjustments, and Approve Adjustments windows.
The Credit Memo Request Approval Workflow uses approval limits that have a document type of Credit Memo when forwarding credit memo requests from iReceivables. The workflow sends a notification to an approver if the request is within the approval limit range for the currency and reason code specified.
When you write off an unapplied receipt amount or an underpayment on a receipt, Receivables uses approval limits that have a document type of Receipt Write-off. You cannot write off a receipt amount that is outside your approval limit range.
You define Adjustment approval limits by currency and dollar amount. You define Credit Memo approval limits by reason type, currency, and dollar amount. You define Receipt Write-off approval limits by currency and dollar amount. The approval limits for write-offs are separate from, but cannot exceed, the system level write-off amounts that you define in the System Options window. You must specify both lower and upper approval limits for each approver.
NOTE: Be sure to update approval limits when personnel changes occur and whenever you define new credit memo reasons in the Receivables Lookups window.
- Define application users
- Define currencies
Navigation path: Receivables>Setup>Approval Limits
9. Define Transaction Types
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.
If AutoAccounting depends on transaction type, Receivables uses the general ledger accounts that you enter here, along with your AutoAccounting rules, to determine the default revenue, receivable, freight, tax, unearned revenue, unbilled receivable, finance charges and AutoInvoice clearing accounts for transactions you create using this type. For bills receivable, the accounts that you enter here determine the bills receivable, unpaid bills receivable, remitted bills receivable and factored bills receivable accounts for a bill receivable.
You can associate transaction types with your invoice sources in the Transaction Sources window to speed data entry in the Transactions and Credit Transactions windows. Active transaction types appear as list of values choices in the Transactions, Reverse Receipts, Credit Transactions and Transaction Sources windows, and for bills receivable in the Bills Receivable and Receipt Classes windows.
You can also define credit memo and invoice transaction types to use with AutoInvoice.
You should define your transaction types in the following order:
- Credit memo transaction types
- Invoice, debit memo, and chargeback transaction types
- Bills receivable transaction types
- Commitment transaction types
You must define your invoice transaction types before you define your commitment types.
Suggestion: To be able to void a debit memo, credit memo, on-account credit or invoice, define a Void transaction type with ‘Open Receivables’ and ‘Post to GL’ set to No. Then, as long as there is no activity against the transaction and it has not been posted to your general ledger, you can make it invalid by simply changing the transaction type to ‘Void’.
Navigation path: Receivables>Setup>Transactions>Transaction Types
10. Define Transaction Sources
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.
Note: A batch source provides default information, which you can optionally change at the transaction level.
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. Credit memos that are created by the Credit Memo workflow also use manual batch sources.
- 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.
Suggestion: If you have installed multiple organization support (multi-org), define an imported batch source with the same name in each organization (these sources can have the same or different settings). This enables you to import order lines that belong to different organizations in Oracle Order Management into Receivables.
- Define transaction types
- Define credit memo batch sources (optional)
- Define grouping rules (optional)
Navigation path: Receivables>Setup>Sources
11. Define Receivable Activities
Define receivables activities to default accounting information for certain activities, such as miscellaneous cash, discounts, finance charges, adjustments, and receipt write-off applications.
Activities that you define appear as list of values choices in various Receivables windows. You can define as many activities as you need.
The Tax Code Source you specify determines whether Receivables calculates and accounts for tax on adjustments, discounts, finance charges, and miscellaneous receipts assigned to this activity. If you specify a Tax Code Source of Invoice, then Receivables uses the tax accounting information defined for the invoice tax code(s) to automatically account for the tax. If the Receivables Activity type is Miscellaneous Cash, then you can allocate tax to the Asset or Liability tax accounts that you define for this Receivables Activity.
Receivables uses finance charge activity accounting information when you assess finance charges in your statements and dunning letters.
Query the Chargeback Adjustment activity that Receivables provides and specify GL accounts for this activity before creating chargebacks in Receivables.
You can make an activity inactive by unchecking the Active check box and then saving your work.
NOTE: Once you define an activity, you cannot change its type. However, you can update an existing activity’s GL account, even if you have already assigned this activity to a transaction.
Navigation path: Receivables>Setup>Receipts>Receivable Activities
12. Define Receipt Class
Define receipt classes to determine the required processing steps for receipts to which you assign payment methods with this class. These steps include confirmation, remittance and reconciliation. For example, you must create and remit a direct debit, but you must create, confirm, and remit a bills receivable remittance. You can specify any combination of these processing steps with one exception: if you confirm and reconcile, then you must also remit. If you enter No for all three of these steps, Receivables automatically creates receipts assigned to this receipt class with a status of Cleared.
Receivables uses the payment method you assign to a receipt class to determine how to account for receipts you create using this receipt class.
For each receipt class, you can specify a creation method, remittance method, and whether to require bank clearance for receipts that you assign to this class. If you are defining a receipt class for bills receivable creation payment methods, then Require Confirmation, Remittance Method, and Clearance Method are disabled.
Receivable lets your customers pay their invoices via credit cards and electronic funds transfer.
Navigation path: Receivables>Setup>Receipts>Receipt Classes
13. Define Receipt Source
Define receipt batch sources to provide default values for the receipt class, payment method, and remittance bank account fields for receipts you add to a receipt batch. You can accept these default values or enter new ones. Receipt batch sources can use either automatic or manual batch numbering.
When you select a receipt batch source to enter receipts, Receivables automatically uses the Cash, Receipt Confirmation, Remittance, Factoring, Short Term Debt, Bank Charges, Unapplied Receipts, Unidentified Receipts, On-Account Receipts, Earned and Unearned Discounts, and Bills Receivable account information you assigned to the payment method for this batch source. The payment method accounts for the receipt entries and applications you make using this receipt batch source.
Receivables will issue a warning if you enter a receipt source that includes a payment method that has activities allocated to more than one company. Allocating activities to more than one company will cause some reconciliation reports to distribute data of previously entered transactions across multiple companies. Therefore, information regarding a particular receipt may be distributed across multiple company reports. For example, the Applied and Earned Discount amounts in the Applied Receipt Register would be shown across multiple company reports if you allocated them to different companies.
Receivable provides the automatic receipt source ‘Automatic Receipts.’ You cannot update this predefined receipt source except for the Last Number field. All of the receipt batch sources you define are created with a Receipt Source Type of Manual.
- Define banks
- Define receipt classes (optional)
- Define payment methods (optional)
Navigation path: Receivables>Setup>Receipts>Receipt Sources
14. Define Remit to addresses
Define remit-to addresses to let your customers know where to send payment for their invoices. Receivable 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. However, if you do not wish to set up a remit-to address for each location, you can set up one remit-to address with a default assignment. Receivables will then use this address for all locations or for any locations for which you do not have specific location assignments. This ensures that AutoInvoice will not reject invoices because it could not determine a remit-to address.
Navigation path: Receivables>Setup>Print>Remit to Addresses
15. Define Document Sequences and their Assignment
A document sequence uniquely numbers documents generated by an Oracle E-Business Suite product. Using Oracle E-Business Suite, you initiate a transaction by entering data through a form and generating a document. A document sequence generates an audit trail that identifies the application that created the transaction and the original document that was generated. Document sequences can provide proof of completeness. For example, document sequences can be used to account for every transaction, even transactions that fail. Document sequences generate audit data, so even if documents are deleted, their audit records remain.
Navigation path: General Ledger>Setup>Financials>Sequences>Define
16. Define Grouping Rules
Define grouping rules that AutoInvoice will use to group revenue and credit transactions into invoices, debit memos, and credit memos. Grouping rules specify attributes that must be identical for lines to appear on the same transaction.
Grouping rules include mandatory attributes which are always included in all grouping rules, and optional attributes which may be included in a grouping rule. Optional attributes may be added to the mandatory attributes to create new grouping rules. To be included in a group a transaction must always match on all of the mandatory attributes as well as on all of the optional attributes included in a grouping rule. For complete lists of the mandatory attributes and the optional attributes see the section titled “Using Grouping Rules to Create Transactions” in the Transactions chapter. All attributes of the Transaction Flexfield are optional within a grouping rule, and you can assign these attributes as optional grouping characteristics in the Grouping Rules window.
Navigation path: Receivables>Setup>Transactions>AutoInvoice>Grouping Rules
17. Define Line Ordering Rule
Define invoice line ordering rules for transaction lines that you import into Receivables using AutoInvoice. AutoInvoice uses these rules to order transaction lines when grouping the transactions it creates into invoices, debit memos, and credit memos. You can assign a line ordering rule to each grouping rule.
You also assign transaction attributes to your line ordering rules. AutoInvoice uses these attributes to order invoice lines. You can assign a priority to these attributes for each of your invoice line ordering rules. You can also specify an ascending or descending order for each transaction attribute assigned to a rule.
Active invoice line ordering rules appear as list of values choices in the Grouping Rules window.
Suggestion: If you are importing transactions from Oracle Order Management, create an invoice line ordering rule with the attribute SALES_ORDER_LINE to list the items on the invoice in the same order as they appear on the sales order.
Navigation path: Receivables>Setup>Transactions>AutoInvoice>Line Ordering Rules
18. Customer Creation
The system lets you enter new and modify existing information about your customers. You can enter multiple addresses for a customer and assign a business purpose for each address. You can also define contact people, bank accounts, payment methods, telephone numbers, and relationships for each customer. The system also lets you change a customer’s status from Active to Inactive and specify variable tax information.
You can enter as much or as little information about your customers as you want. The only information that is required for a new customer is a customer name, number, and address. If you do not assign a profile class, the system assigns the profile class ‘DEFAULT’ to each new customer you enter.
Navigation Path: Receivables>Customers>Customers
After the configuration of these steps we are able to make entries in Oracle Receivables.
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