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Define Invoicing and Accounting Rules

For accounting rules with a fixed duration, you specify the period (such as weekly or monthly) and the number of periods over which the revenue is recognized. The revenue is then evenly divided across the periods. The percentage can be updated if necessary, but must always total 100. For example, if you define an accounting rule with a period type of monthly, spanning 4 periods, and you accept the default, prorated revenue distribution, Receivables will recognize 25 percent of the transactions revenue for each of 4 months.

Fixed duration rules also allow you to set specific GL dates on which to recognize revenue, when you select Specific Date as your period type. When you specify a date for a period, then all other periods for this accounting rule must also be assigned a date.

When defining accounting rules with a variable duration, you must enter a period type, but not the number of periods. The number of periods is defined when you manually enter an invoice in the Transaction window. If the invoice is imported, the number of periods is passed through AutoInvoice. When defining a variable duration accounting rule you can optionally specify what percentage of revenue you want to recognize in the first period. The remaining revenue will be prorated over the number of periods you specify during invoice creation.

Assign Invoicing and Accounting Rules

Invoicing Rules
	Assigned to	Window	Region
	Invoice	Transaction	More

Accounting Rules
	Assigned to	Window	Region
	Invoice Line	Transaction	Additional Line Information
	Items	Define Items	Item (Invoicing Attributes)
	Standard Lines	Standard Memo Lines	(Not Applicable)

If you are entering an invoice manually, you must enter an invoicing rule on the invoice header or you will not be able to associate accounting rules with the invoice lines. If you enter an invoicing rule and include items or standard memo lines that have associated accounting rules, the accounting rules default for the invoice line. You can change or manually enter the accounting rules for these invoice lines if there has been no activity against the invoice.

Note: You can also assign invoicing rules to items and standard lines, but these will not be used during manual invoice entry. This is because the invoicing rule assigned at the invoice header will override the invoicing rules defined for the item or standard line.

For imported invoices, if you use the Order Entry Receivables Interface to populate the AutoInvoice tables, it will derive the invoicing and accounting rules based on the hierarchy described in the Accounting and Invoicing Rules section of the Integrating Order Entry with Receivables essay. For more information, refer to Integrating Oracle Order Entry with Oracle Receivables in the Oracle Financials and Oracle Public Sector Financials Open Interfaces Manual.

If you import invoice data from an external system, you must populate the following columns in the AutoInvoice tables if you want AutoInvoice to generate invoices with rules:

Invoicing Rules
	Column	Populate if:
	INVOICING_RULE_ID	Your batch source validates rules by id.
	INVOICING_RULE_NAME	Your batch source validates rules by value.

Accounting Rules
	Column	Populate if:
	ACCOUNTING_RULE_ DURATION	You are passing a variable duration rule.
	ACCOUNTING_RULE_ID	Your batch source validates rules by id.
	ACCOUNTING_RULE_NAME	Your batch source validates rules by value.

Note: If no rules are passed with the invoice lines in the interface tables, AutoInvoice will not try to derive the invoice and accounting rules from the associated items or standard lines.

AutoInvoice uses the invoicing rules assigned to the invoice lines to group lines into invoices. An invoice can only have one invoicing rule, hence lines imported with an invoicing rule of Bill in Arrears will not be grouped with lines whose invoicing rule is Bill in Advance when creating an invoice.

Accounting rules, however, require no special grouping, as an invoice may contain a different accounting rule for each invoice line.

Determine the Invoice and GL Dates

If you use Bill in Advance as the invoicing rule, AutoInvoice uses the earliest start date of the accounting rules associated with your invoice lines as the GL date of the invoice.

If you use Bill in Arrears as the invoicing rule and the invoice line has an accounting rule of type 'Accounting, Fixed Duration' and a period of 'Specific Date,' AutoInvoice sets the GL date and transaction dates equal to the latest Specific Date of the accounting rule.

For all other accounting rules using the Bill in Arrears invoicing rule, AutoInvoice first computes an ending date for each invoice line based on the accounting rule, accounting rule start date, and duration. AutoInvoice then uses the latest specific date for both the invoice GL date and the transaction date.

When creating invoices with rules manually, the GL date of the invoice is entered during invoice entry. If you use Bill in Advance as the invoicing rule, this date will remain equal to the GL date of the invoice.

However, Receivables overrides this date for an invoicing rule of Bill in Arrears when you save the invoice after completing invoice lines. Receivables uses the same method to derive the new GL date as it does for imported invoices. This method is explained in detail above. Receivables will warn you that it is updating the GL date of the invoice when you save the record. You can then change this date if it does not meet your requirements.

Determine Accounting Rule Start Dates

When entering invoices manually, you must set the date that you want to start recognizing revenue for an invoice line. Use the First Date field in the Lines window to enter the start date.

When importing invoices, AutoInvoice determines the accounting rule start dates as follows:

If your invoice has an accounting rule with a type of 'Accounting, Fixed Duration' and a period of 'Specific Date,' AutoInvoice uses the earliest accounting rule date as your rule start date. For example, if your accounting rule dates are 10-JUN-93, 10-JUL-93, and 10-AUG-93, AutoInvoice uses 10-JUN-93 as your rule start date.

If you elected to derive the rule start date, AutoInvoice first uses the ship date in the interface table. If the ship date does not exist, AutoInvoice uses the sales order date. If the sales order date does not exist, AutoInvoice uses the date you entered in the Submit Requests window.

If your invoice does not use a fixed duration accounting rule with a specific date period, or you have not elected to derive the rule start date, then the default date specified in the Submit Requests window is used.

View and Update Account Sets

For each account set, Receivables specifies the account and percent of the line total assigned to each account. You can update account set distributions to split revenue or offset amounts over multiple accounts, any time before running the Revenue Recognition program. This lets you ensure that revenue is distributed to the correct accounts, regardless of how account structures may change. Receivables always ensures that the entered percents total 100.

You can reveiew and update account sets in the Accounts for This Line and the Accounts for All Lines alternative regions of the Accounting window. To update an account set, specify the account set class that contains the account sets. Valid Account Set Classes include:

Offset	This account set type includes the suspense accounts to be used during your revenue recognition cycle. If your invoicing rule is Bill in Arrears, the offset account set is Unbilled Receivables. If your invoicing rule is Bill in Advance, the offset account set is Unearned Revenue.
Revenue	This account set type includes your revenue accounts.
Tax	This type of account set is used for tax lines.

Additionally, you can view account sets for all lines in the Account Sets for All Lines alternative region. You can also use this region to update the account assignment for a given line, but you must use the Account Set for a Single Line alternative region to update the percent assigned to the account.

Recognize Revenue

The Revenue Recognition program is run automatically for the period you are posting whenever you transfer records to your General Ledger using the Run GL Interface program. This ensures that the revenue for invoices with rules is recognized before you post and close the period. Alternatively, if you wish to choose when your distributions are created, you can submit the Revenue Recognition program manually at any time from the Run Revenue Recognition window. The Revenue Recognition program will not create duplicate distribution records even if the program is run several times within the same period.

Credit Invoices with Rules

See Also

Entering Credit Memos

Entering Invoices with Rules

Understanding Credit Memos