Procure to Pay Cycle

Below steps are involved in Procure to Pay Cycle

Pictorial Representation of Procure to Pay Cycle

1) Create Requisition:

Requisition is one of the purchasing documents will be prepared by the employee whenever he required the materials or Services or Training and so on.

We have two types of Requisitions 1) Internal   2) Purchase

Internal requisition will be created if materials are receiving from another Inventory inside of the organization.

Purchase requisition will be created while purchasing the materials from the Suppliers.

Tables Effected:-

PO_REQUISITION_HEADERS_ALL

PO_REQUISITION_LINES_ALL

PO_REQ_DISTRIBUTIONS_ALL

2) RFQ (REQUEST FOR QUOTATION):

Once the Requisition is Approved Buyer will prepare there RFQ document which will be delivered to the supplier. Supplier will respond for that with quotation.

We have three types of RFQ documents

BID RFQ: This will be prepared for the specific fixed quantity and there won't be any Price Breaks (Discounts).

Catalog RFQ: This will be creating for the materials which we will purchase from the suppliers regularly, and large number of quantity. Here we can specify the Price Breaks.

Standard RFQ:  This will be prepared for the Items which we will purchase only once not very often, Here we can include the Discounts information at different quantity levels.

RFQ Information will be entered at 3 Levels

  1) Headers

  2) Lines

  3) Price Breaks (CATALOG, STANDARD) or Shipments (Only for Bid RFQ)

Terms and Conditions:

While creation of the RFQ documents we will select the Terms button and we will enter the terms and condition details.

Payment Terms: When Organization is going to make the payment and Interest rates

Fright Terms: Who is going to bear the Transportation chargers whether Buyer or Supplier

FOB (Free On board): If any materials damage or any missing quantity is there then the responsibility of those materials.

Carrier: In which Transportation Company Organization Required Materials Transportation Company Name.

Tables Effected:-

PO_HEADERS_ALL.TYPE_LOOKUP_CODE IN ('RFQ')

PO_HEADERS_RFQQT_V

PO_LINES_RFQQT_V

PO_RFQ_VENDORS_V

3) QUOTATION:

Quotation is another purchasing document we will receive from the Supplier which contains the supplier quote details, Price, Payment terms and so on.

Whatever the quotations we have received from the supplier we will enter in the system through form.

We have three types of Quotations 1) Bid 2) Catalog 3) Standard

For Bid RFQ we will receive Bid quotation from the Supplier.

For Catalog RFQ we will receive Catalog quotation from the Supplier.

For Standard RFQ we will receive Standard quotation from the Supplier.

Tables Effected:-

PO_HEADERS_ALL.TYPE_LOOKUP_CODE IN ('QUOTATION')

PO_HEADERS_RFQQT_V

PO_LINES_RFQQT_V

PO_RFQ_VENDORS_V

4) PURCHASE ORDER:
PO is one of the Main document which will be prepared and approved by the buyer and
send it to the supplier. This contains the following information terms and Conditions, Items details, Quantity, Price, distributions and Shipment Details and so on.

We have four types of Purchase Order 1) STANDARD 2) PLANNED 3) BLANKET 4) CONTRACT 

	Standard P.O	Planned P.O	Blanket P.O	Contract P.O
Terms and Conditions Goods or Service Known Pricing Known Quantity known Account Distributions Known Delivery Schedule Known Can be Encumbered Can Encumber releases	Yes Yes Yes Yes Yes Yes Yes N/A	Yes Yes Yes Yes Yes May be Yes Yes	Yes Yes May be No No No No Yes	Yes No No No No No No N/A

Match Approval Level: - While creating the Purchase Order we will mention the Match Approval Level at Shipments we will have 3 types they are

2-way: - Purchase Order and Invoice Quantities must match within tolerance before the corresponding invoice can be paid.

3-way: - Purchase Order, Receipts and Invoice Quantities must match with in tolerance before the corresponding invoice can be paid.

4-way: - Purchase Order, Receipts, Inspection and Invoice Quantities must match with in tolerance before the corresponding invoice can be paid.

Tables Effected:-

PO_HEADERS_ALL

PO_LINES_ALL

PO_DISTRIBUTIONS_ALL (REQ_HEADER_REFERENCE_NUM in Distributions table is the Requisition number for this PO)

PO_LINE_LOCATIONS_ALL

5. RECEIPTS:

           Receipts are one of the documents it will be used to find out how much quantity Supplier has supplied. We will find out Purchase Order status if it is successfully approved then we will create the Receipt. We will give the PO Number and then select find button check the PO lines and mark those and then save. It will create the Receipt number for that select Header button it will shows the receipt number and date. 

Tables Effected:-

RCV_SHIPMENT_HEADERS

RCV_SHIPMENT_LINES (Lines Table has PO_HEADER_ID)

Once Receipt created then checks in Inventory module whether the requested items are received or not by using the below tables

MTL_ONHAND_QUANTITIES

 6) Create Invoice in Payables:

 Account payables will be used to do the payment transactions. A.P Module is integrated with both P.O and G.L Modules. In Account Payables we will create the invoices and we will approve once invoice is approved successfully we will make the payment. Once payment is over we will move the transactions from A.P to GL.

Invoice Holds: -    If invoice is not approved then that invoice will be keeping under hold status. By selecting holds button in invoice form we can see the holds details

ap_holds_all

ap_holds_release_name_v

Tables Effected:-

AP_INVOICES_ALL

AP_INVOICE_DISTRIBUTIONS_ALL

Accounting Entries Tables:

AP_ACCOUNTING_EVENTS_ALL

AP_AE_HEADERS_ALL

AP_AE_LINES_ALL

7) Making a Payment:

Once the Invoice is approved then we can go for payments. The Payments are or 3 types. They were

1.     Manual

2.     Quick

3.     Refund

Manual: -    Here we will issue the checks manually to the supplier and we will capture that information in the payment scheme by using manual payment option.

Quick: -     Through the Quick Payment type we can generate checks through the system and we can have the transactions directly in the system.

Refund: -   Whenever company is going to give advance back to the customer that time we will select payment type as Refund.

Tables Effected:-

AP_INVOICE_PAYMENTS_ALL

AP_PAYMENT_SCHEDULES_ALL

AP_CHECKS_ALL

AP_CHECK_FORMATS

AP_BANK_ACCOUNTS_ALL

AP_BANK_BRANCHES

AP_TERMS

8) Reconcile:

We will perform the reconciliation process of bank accounts in Cash Management Module

Tables Effected:-

CE_STATEMENT_HEADERS_ALL

CE_STATEMENT_LINES

9) Transfer to General Ledger:

 We will execute the concurrent program from SRS Window. This program will transfer all the payment transactions into the G.L Module. It will take following parameters.

Program Name: -   Payables Transfer to General Ledger

Parameters:-

           Set of Books Name

           Transfer Reporting Book(s)

           From Date

           To Date

           Journal Category

Tables Effected:-

GL_INTERFACE

Journal Import: To transfer the data from General Ledger Interface table to General Ledger, run the Journal Import program from Oracle General Ledger.

Tables Effected:-

GL_JE_BATCHES

GL_JE_HEADERS

GL_JE_LINES

Post Journals "Posting"

GL_BALANCES