Oracle Financials Test No.9 Dt: 28 th Jan 2006 PAYABLES - I 1.What are different types of invoices? 1. Credit Memo. An negative amount invoice you receive from a supplier representing a credit for goods or services purchased. 2. Debit Memo. A negative amount invoice you send to notify a supplier of a credit you recorded for goods or services purchased. 3. Interest. An invoice that Payables automatically creates invoices to pay interest for overdue invoices if you enable automatic interest calculation for a supplier, and if you pay an overdue invoice for the supplier in a payment batch or with a Quick payment. 4. Expense Report. An invoice you enter to record business–related employee expenses. 5. Mixed. A Standard or Credit/Debit Memo invoice for which you can enter both positive and negative amounts and perform both positive and negative matching. 6. PO Default. A trade invoice you want to automatically match to a specified purchase order and then manually match to the individual shipments on the purchase order. After you use this invoice type to complete the match, the invoice will become a Standard type invoice. 7. Prepayment. An advance payment you make to a supplier or employee. If you enter Temporary for the Prepayment Type field, then you can later apply prepayment to an invoice. 8. QuickMatch. A trade invoice you want to automatically match to all the shipments of a specified purchase order. 9. Standard. A trade invoice you receive from a supplier. 10. Withholding Tax. An invoice you have generated to pay a tax authority. 2.What is Pre-payment invoice? What are the different types of Pre-payment invoice? What is the accounting entry for Pre-payment at different stages? DATE – 28 TH Jan 2006 1 OF 27
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Oracle Financials Test No.9 Dt: 28th Jan 2006PAYABLES - I
1.What are different types of invoices?
1. Credit Memo. An negative amount invoice you receive from a supplier representing a credit for goods or services purchased.
2. Debit Memo. A negative amount invoice you send to notify a supplier of a credit you recorded for goods or services purchased.
3. Interest. An invoice that Payables automatically creates invoices to pay interest for overdue invoices if you enable automatic interest calculation for a supplier, and if you pay an overdue invoice for the supplier in a payment batch or with a Quick payment.
4. Expense Report. An invoice you enter to record business–related employee expenses.
5. Mixed. A Standard or Credit/Debit Memo invoice for which you can enter both positive and negative amounts and perform both positive and negative matching.
6. PO Default. A trade invoice you want to automatically match to a specified purchase order and then manually match to the individual shipments on the purchase order. After you use this invoice type to complete the match, the invoice will become a Standard type invoice.
7. Prepayment. An advance payment you make to a supplier or employee. If you enter Temporary for the Prepayment Type field, then you can later apply prepayment to an invoice.
8. QuickMatch. A trade invoice you want to automatically match to all the shipments of a specified purchase order.
9. Standard. A trade invoice you receive from a supplier.10. Withholding Tax. An invoice you have generated to pay a tax authority.
2.What is Pre-payment invoice? What are the different types of Pre-payment invoice? What is the accounting entry for Pre-payment at different stages?
Prepayment. An advance payment you make to a supplier or employee. If you enter Temporary for the Prepayment Type field, then you can later apply prepayment to an invoice.
Two types of prepayments are there, namely, Temporary and Permanent. In case of earlier one, it is treated as advance to the supplier and will be adjusted against any invoice on or after the settlement date but in case of later one, it is treated as deposit with the supplier.
3.What is the accounting entry for a standard invoice?
In case of Matching With PO - AP accrual A/c Dr XXXTo Liability A/c XXX
In case of Distribution - Charge A/c Dr XXXTo Liability A/c XXX
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In case of Distribution & Prepayment - Charge A/c Dr XXXTo Prepayment A/c XXX
To Liability A/c XXX
In case of Distribution & Prepayment, - Charge A/c Dr XXXWithholding Tax, Sales Tax To Prepayment A/c XXX
To Liability A/c XXXTo With Holding Tax XXXTo Sales Tax XXX
4.Explain the concept of ‘Pay Group”. Brief the steps to define and assign ‘Pay Group’.
Pay Group you want to assign to any suppliers that you create from employees during Invoice Import. You can define additional values for Pay Group in the Purchasing Lookups window.
Purchasing LookupsNote that in the Oracle Public Sector Purchasing Lookups window you can add values for the following lookups that Payables uses:
1. FOB2. Freight Terms.3. Minority Group4. Pay Group. Groups invoices in payment batches.5. Supplier Type.
Define pay group ay lookups-purchasing. It can be assigned at payable option - supplier tab page, supplier screen - payment tab page and supplier site - payment tab page.
5.What is the difference between PO default and Quick Match Invoices?
If you know the number and amount of the purchase order to which you want to match, Payables provides you with two invoice types, PO Default and QuickMatch, to help speed up invoice matching.
Enter PO Default as the invoice type if you know the purchase order you want to match to, but you do not know to which purchase order shipments or distributions you want to match. When you enter a PO Default invoice in the Invoice Workbench, Payables prompts you to enter the purchase order number and automatically copies the supplier name, supplier number, supplier site, and currency from that Purchase order to the invoice. When you choose the Match button, Payables will retrieve all purchase order shipments or receipt lines associated with the specified purchase order. You can then match to any shipment, distribution, or receipt line.
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Enter Quick Match as the invoice type if you want to match an invoice to all shipments or receipt lines on a purchase order. When you enter a Quick Match invoice in the Invoice Workbench, Payables prompts you to enter the purchase order number and automatically enters the supplier name, supplier number, supplier site, and the purchase order currency for the invoice currency. When you choose the Match button, Payables automatically navigates to the match window, and selects all shipments that have an unbilled quantity. You can choose to complete the match or override the matching information.
6.What do you mean by Mixed Invoice?
Mixed Invoices are invoices or credit/debit memos for which you can perform both positive and negative matching to purchase orders and to other invoices.
For example, you can enter an invoice for –$100 with Invoice Type Mixed. You can match to an invoice for $–200, and match to a purchase order for $100.
To enter a Mixed invoice:
1. Enter the invoice or credit/debit memo in the Invoices window, and enter Mixed as the invoice Type.You can enter either a positive or negative invoice amount.
2. Match to purchase orders, and/or invoices
7.What are the different payment methods?
Payment Method.
Check. Payment in a payment batch, Quick payment, or manual payment.
Electronic. You pay electronic payments either through the e–Commerce Gateway, or by delivering a payment batch file to your bank. For both methods, Payables creates a file during payment batch creation. For e–Commerce Gateway payments, the file is processed through the e–Commerce Gateway and delivered to your bank to create payments. For electronic funds transfers, the file is formatted and delivered to your ap.out directory for you to deliver to your bank.
Wire. A payment method where you pay invoices outside of Payables by notifying your bank that you want to debit your account and credit your supplier’s account with appropriate funds. You provide your bank with your supplier’s bank information, and your bank sends you confirmation of your transaction. Your supplier’s bank sends your supplier confirmation of the payment. You then record the transaction manually.
Clearing. Payment method you use to account for interfund expenses when you do not actually disburse funds through banks. Generally, you do not generate a payment document with the Clearing payment method
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8.What is cash clearing account? And when it will be used?
Cash Clearing. If you have enabled the Account for Payment When Payment Clears Payables option, enter the cash clearing account you are associating with a payment document. When you create a payment, Payables creates accounting entries for your unreconciled invoice payments to credit this cash clearing account using this account. After you reconcile your invoice payments using Oracle Cash Management, Payables creates accounting entries to debit this cash clearing account and credit this bank account’s cash account. The account you enter here overrides the Cash Clearing Account you entered in the GL Accounts region of the Bank Accounts window. For future dated payments, when the payment is recorded as mature, Payables debits the future dated payment account and credits the cash clearing account. When you reconcile the payment, Payables debits the cash clearing account and credits the cash account.
9.What is payment format and what is it used for?
Payment Format. The format you want Payables to use to format payments for a payment document.
If you enable the Use Multiple Currencies Payables option, select your functional currency as your bank currency, and define your bank account as multiple currency, you can select any of the payment formats you defined, whether they are multiple currency or not. If you do not define your bank account as multiple currency, you can only select formats that are defined in the same currency as your bank account.
10.What is distribution hold? Can it be released manually?
Hold In Oracle Payables, an Oracle Applications feature that prevents a transaction from occurring or completing until the hold has been released. You can place a hold on an
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invoice or an invoice schedule line. All holds in Payables prevent payment; some holds also prevent posting to your general ledger.
Distribution hold arises due to imbalance of distribution total, this can be released only by correcting the distribution total. No, it cant be released manually from action window, as we have to correct the entry.
11.What is the selection criteria for concurrent program ‘payables approval’ to approve the invoices?
Parameters: Option, Invoice Batch Name, From Invoice date, to Invoice date, Supplier Name, Pay Group, Invoice Number, Entered By.
12.List the different ways of payment to invoices.
Through Invoice Work Bench & Payment Workbench
13.What are the different statuses of pre-payment invoice? What is the relevance of settlement date?
1. Never approved2. Unapproved3. Unpaid4. Available – Temporary 5. Fully Applied - Temporary6. Permanent7. Cancelled
Settlement Date The date before which you cannot apply a prepayment to an invoice. Payables prevent you from applying a temporary prepayment to an invoice until on or after the Settlement Date of the prepayment.
14.When I am trying to enter an invoice, ‘NEW’ button is disabled. What could be the reason for that?
If you checked the Use batch control Check box at Invoice tab Page in Payables Option ‘NEW’ button disabled.
15.Can I assign a supplier type of bank account to more than one supplier?
Yes,Allow Assignment to Multiple Suppliers: Enable this option if your bank account belongs to an organization that receives payments for multiple suppliers (a factor organization). With this option enabled, Payables allows you to enter any combination of suppliers and sites in the Supplier Assignments region. It will make the account always
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available in the list of values for the fields (Bank) Name and (Bank) Number in the Bank Accounts region of the Suppliers and Suppliers Sites windows.
16.What is the request name to view the list of Credit memos?
The Concurrent program is Credit Memo Matching Report.
Parameters: Supplier From, Supplier To, Begin Credit Memo date and End Credit memo date.
17.List the different bank accounts uses in oracle payables.
1. Internal2. Customer3. Supplier
18.Even though I have defined a supplier and supplier site, I am not able to enter an invoice for that. Why?
If you are not checking the circled item in supplier site level.
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19.On what basis Oracle payables caution the user while entering a Debit memo/Credit memo, as it is a Duplicate.
Those bases are, namely,
1. Supplier2. Supplier site3. Currency4. Amount
1.What are the mandatory steps for Payable module before entering transactions?
Create application user sign–ons and passwords.
Define your chart of accounts.
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Define your accounting period types and accounting calendar periods.
Define a set of books. Specify a set of books name and assign it a calendar, functional currency, and a chart of accounts structure.
After choosing your set of books, use the Application Developer responsibility to set the GL Set of Books ID profile option to Updateable.
After choosing your set of books, use the System Administrator responsibility to set the GL Set of books Name profile option. If you are not using multiple organizations feature, set the option for the Oracle Payables application. If you are using multiple organizations feature, set the option for each unique combination of organization and responsibility.
Define Payables Lookups.
Define Purchasing Lookups.
Enter locations.
Enter employees. If you have Oracle Human Resources installed, use the People window. See: Entering a New Person (Managing People Using Oracle HRMS). If you do not have Oracle Human Resources installed, use the Enter Person window.
If Oracle Inventory or Oracle Purchasing is installed, you must define at least one Inventory Organization before defining Financials Options.
Define payment programs.
Install or upgrade Payables.
Select your primary set of books.
Use the System Administrator responsibility to assign your set of books to a responsibility.
Define Financials options.
Define Payables options.
Define your payment terms.
If you plan to use automatic withholding tax, define Tax Authority type suppliers. You must do this before defining tax codes and tax groups.
Define bank accounts.
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Define Suppliers.
Open your Payables accounting period.
Set up Print Styles and Drivers for the Supplier Mailing Labels Report.
2.What is ‘pay date basis’? Explain the different options available in it.
Pay Date Basis. The Pay Date Basis default for each new supplier you enter. The Pay Date Basis for a supplier defaults to the new supplier sites you enter for the supplier. You can override the default for each supplier and supplier site.Discount. Payables selects invoices for payment based on the scheduled payment discount date.Due. Payables selects invoices for payment based on the scheduled payment due date, regardless of any available discounts.
3.How to record a refund from a one-time supplier? Explain accounting entries also.
By entering the Debit Memo we can record the recover from supplier, The one time supplier is only for the information on suppliers not for the controlling.The accounting entries for the same as followsAccounting entries for enter invoice at Approval:-
Charge A/c….Dr XXXTo Liability A/c XXX
Accounting entries for enter invoice at Payment:-
Liability A/c….Dr XXXTo Cash Clearing A/c XXX
In this case if we want refund from the supplier to raise the Debit memo against the Goods or Services.
Accounting entries for Debit Memo at Approval:-
Liability A/c….Dr XXXTo Charge A/c XXX
Accounting entries for enter invoice at Payment:-
Cash Clearing A/c…. Dr XXXTo Liability A/c XXX
4.What do you mean by pay through date and additional pay through days?
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Pay Through Date. Payables selects all approved and unpaid invoices that have a due date on or before the Pay Through Date. You cannot update this field after invoice selection for a payment batch.
Additional Pay Through Days. Number of days between your regular payment batches. Payables uses the additional pay through days to determine the default Pay Through Date when you initiate a payment batch. For example, if you define 5 as the value in this field, Payables adds 5 days to the system date to calculate the default Pay through Date when you initiate a payment batch.
5.How to define a payment term, if you require to pay a supplier 50% on delivery and 50% on installation?
This can be solved in so many ways, by using special calendar we can resolve this problem.
6.How to identify the Set of Books name in payables?
1. Choose set of Books
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7.In case of void and re-issue, whether the same document will be issued or new document will be issued?
Allow Void and Reissue. If you enable this option, you can reissue a Quick payment. You may need to reissue a check for a Quick payment if it is spoiled during printing. When you reissue a check, Payables voids the old check and creates a replacement check. The checks are identical except that the new check as a new check number, payment date, and payment exchange rate if you are using multiple currencies. You cannot select the Void and Reissue option for future dated payments
8.What are different calculation levels of Automatic tax calculation?
Calculation Level. If you enable the Use Automatic Tax Calculation option, select the level at which you want Payables to automatically calculate sales tax. This value defaults to new suppliers you enter.
Header. Automatically create tax distributions based on the Invoice Amount and Tax Code in the Invoices window:
Tax Code. Automatically create tax distributions based on the distribution Amount, Tax Code, and Includes Tax check box in the Distributions window. When calculating tax amounts, group lines with the same tax code and Includes Tax check box setting together, calculate tax, and then round the tax amount.
Line. Automatically create tax distributions based on the distribution Amount, Tax Code, and Includes Tax check box in the Distributions window. When calculating tax amounts, calculate tax for each distribution, round the tax amount, then add the tax amounts.
9.Is it possible to un-apply a pre-payment invoice if it is already applied to a standard invoice?
Yes, we can unapply the prepayments at any status except when it is cancelled. Prepayment apply will not calculate discounts as it is already paid.
10.what options are to be enabled if invoice Currency and Payment Currency are different?
As the invoice currency and payment currency should be same due to which there is no option available with respect to this.
11.List any five standard reports in oracle payables.
Five Standard Reports
1. Invoice Aging Report
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2. Invoice Audit Report3. Payables account analysis Report4. Payment Batch Control Report5. Payment distribution Report
12.How to set different interest rates for different suppliers?
There are no such options available for defining different interest rates for different suppliers. There are only uniform interest rates.
13.When ‘tax code’ at invoice header will be mandatory?
Require Tax Entry at Header. If you enable this option, Payables requires you to enter a Tax Code and Tax amount in the Invoices window when you enter an invoice.
The calculation should be Header, in this situation the tax code at header level should be mandatory.
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14.Is ‘Invoice received date’ mandatory or optional?
Invoice received date is optional if the terms date is set to other than Invoice Received date.
15.Explain the relevance of ‘Pooled Account’.
Pooled Account. If you use Automatic Offsets and you want to associate multiple companies with this bank account, then enable this option. When you enable the Automatic Offsets Payables option, Payables creates one offsetting liability distribution for each invoice distribution. If you then pay the invoice from a pooled bank account, then which Payables accounts for the invoice payment, Payables creates one corresponding cash accounting entry for each liability distribution.
16.What is accounting entry if we take any discount on payment?
Oracle Financials Test No.9 Dt: 28th Jan 2006PAYABLES - I
17. When I’m trying to ‘Approve’ invoice, Approve button is grayed out. What could be the reason?
Allow Online Approval. Enable this option if you want to allow users to submit Payables Approval in the Invoices window and the Invoice Batches window.
If you are not enable the above circled item then the above case will arise.
18.How to resolve the following error: “The payment date must be on or after the system date”.
The above error can be resolved by checking the circled item
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Allow Pre–Date. If you enable this option, Payables allows you to create payments with a payment date before the system date for any payment except a manual payment.
19.What is the accounting entry for foreign currency payment in case of realized gain or realized loss?
Liability A/c … Dr XXXTo Realized Gain A/c XXXTo Cash Clearing A/c XXX
Liability A/c … Dr XXXRealized Loss A/c … Dr XXX
To Cash Clearing A/c XXX
AP:-
1) What are the different types of Interfaces?
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Ans Refer Laxman Vendor import notes in scanned documents
a) Vendor conversion / Import
A vendor is any company or person that we buy goods or services from.
Interface table --- we need to create our own custom interface table.
Base tables
PO_VENDORS (Segment1-Vendor number is unique)
PO_VENDOR_CONTACTS
PO_VENDOR_SITES_ALL
b) Legacy Invoice
Interface Tables
AP_INVOICE _INTERFACE is the header info
AP_INVOICES_LINES_INTERFACE is the lines table.
RUN PAYABLES INVOICE IMPORT CONCURRENT PROGRAM
Base Tables
AP_INVOICE_ALL is also the header information is stored.
AP_INVOICES_DISTRIBUTIONS_ALL is the lines information table.
Major Editors: Ranjeet Ku… sachin8217 David K. D…/ All
[edit]IntroductionSetup steps for foreign currency payments (for foreign currency invoices). Foreign currency payments can be made through
1.Bank account maintained in functional currency but multi-currency enabled and relevent payment document attached. (In this case the payment transaction can be in foreign currency or functional currency depends upon the document selected for the payment.)
2.Bank account maintained in foreign currency with relevent payment document attached.
Oracle Financials Test No.9 Dt: 28th Jan 2006PAYABLES - I
Steps1.Enable use multi-currencies option at Payables Options of payables in the currencies region.
2.Create a payment format which has multiple currency radio button enabled.
3.Create a bank and bank account.Enable Multicurrency payments in the bank account at payment options region.
4.Attach the format created in step2 at the documents screen of the bank account.
5.Create an invoice in a foreign currency,validate it and ensure there are no holds.
6.Pay the invoice through any of the three options:a.Through invoice work benchb.quick paymentsc.Batch payments
7.In any of the options,enter the bank account created in step 3 and enter the document created in step4.
8.a invoice workbenchIF done through this,already payment is referenced to the invoice and so you need to enable the format and print only and click ok.
b.quick paymentsHere you may have to enter supplier name,site and click the invoices button and choose the invoice created in step5,click ok,and then enable format and print.
c.payment batchesIn this case,system will pick up the invoice if all entered conditions in the batch are satisfied.Otherwise you can force the invoice for payment.After formatting and printing the batch,confirm the batch in order to release the document for future.
[edit]ConclusionIn all the above three scenarios,you may find that the payment currency field will be showing only the invoice currency and you cannot enter any other currency there(Euro could be an exception) which substantiates the point that payment currency will always be same as invoice currency.
