Payment on Receipt
Payment on Receipt enables the user to automatically create standard, unapproved invoices for payment of goods based on receipt transactions. Invoices are created using a combination of receipt and purchase order information, that eliminates duplicate manual data entry and ensures accurate and timely data processing. Payment on Receipt is also known as Evaluated Receipt Settlement (ERS) and Self Billing.
Automatically create invoices with multiple items and distribution lines, and include sales tax.
You define which suppliers participate in Payment on Receipt and enforce matching rules to ensure the proper payments are made to the suppliers.
The amount on the invoice is determined by multiplying the Quantity received by the Purchase Order Item Unit Price. The Payment Terms on the invoice default from the purchase order payment terms. The Payment Currency defaults from the supplier site. Sales Tax is calculated based on the Tax Codes on each Purchase Order Line.
If the Alternate Pay Site is populated for the Supplier Site used on the Purchase Order, the invoice created is for the Alternate Pay Site, otherwise the Supplier Site on the Purchase Order is used. The Supplier Site used for the invoice must be defined as a Pay Site.
Advance Shipment Notices with Billing Information
Invoices are generated automatically for Advance Shipment Notices (ASNs) that contain billing information, if they are successfully validated in the receiving open interface after being sent by your supplier. You don't have to receive against an ASN with billing information in order for Payment on Receipt to automatically generate an invoice.
Return-to-supplier and receipt adjustment transactions do not automatically generate debit memos once an invoice has been generated using Payment on Receipt.
Create Invoices with Multiple Items and Multiple Distribution Lines
You can create a single invoice for one or more items as long as the items have not been previously invoiced and purchase order matched. If you are creating an invoice from the receipt transaction and purchase order, you are able to create an invoice for all ordered and received items. In the event of a partial shipment or multiple delivery dates, you are able to create multiple invoices for a single purchase order.
In addition, if your purchase order contains multiple distribution lines, you can create an invoice in Oracle Payables with the same multiple distribution lines.
When creating multiple distribution lines for invoices with partial receipt quantities, the Pay on Receipt AutoInvoice program will either prorate the charges across all your purchase order distribution lines (for the received item) or use the FIFO method if you utilize Cascading Receipts. After the invoice has been created, you are able to make changes to the invoice distribution in accordance with the current Oracle Payables system functionality.
Note: Return-to-supplier and receipt adjustment transactions do not automatically generate debit memos once an invoice has been generated using Payment on Receipt.
Enforce Matching Rules to Ensure Proper Payment
Invoices created automatically are subject to the same matching rules as standard invoices to ensure proper payment. Three and four way matching is enforced by Oracle Payables if you specify three or four way matching for the Invoice Matching supplier site option. Three way matching is the process of verifying that the purchase order, invoice, and receiving information matches within accepted tolerance levels. Three way matching is available with the 'Receipt Required' purchasing option.
Four way matching is the process of verifying that the purchase order, invoice, inspection, and receiving information matches within accepted tolerance levels. Four way matching is available with the 'Inspection Required' purchasing option.
Oracle Payables requires that you approve invoices before you post or pay them. Approvals may be handled interactively or by batch process. All discrepancies and/or adjustments must be handled manually using the appropriate online Purchasing, Receiving, and/or Payables windows.
Create Invoices which Include Sales Tax
You can generate a purchase order matched invoice which includes sales tax for those invoices you create using a receipt transaction combined with a purchase order. If an invoice created from a receipt transaction and purchase order is to include sales tax, you must first have entered a Taxable status of 'Yes' and a Tax Name in the Purchase Order Shipment zone. If a Tax Name is not entered, an invoice tax line is not created. The tax amount for the tax distribution line is calculated by multiplying the quantity received by the purchase order unit price by the tax rate associated with the Tax Name.
In accordance with current Oracle Purchasing functionality, you are not able to create multiple tax lines per individual purchase order shipment line because each Purchase Order shipment line can have only one Tax Name associated with it. Any additional taxes can be added manually in the Distributions window in Payables.
Also you can create tax distribution lines based on the tax type of each distribution:
If the tax type of the distribution is 'Sales', one tax distribution line is created for each taxable invoice distribution. The Offset tax distribution line is created if the following conditions are met:
Tax code specified on the Purchase Order matches the tax code specified at the supplier pay site.
Offset tax code is specified at the supplier pay site.
If the tax type is 'Use', no tax distribution will be created.
Create Scheduled Payments
The invoice creation program automatically creates a scheduled payment for each invoice based on the payment of terms and your invoice terms date. After the invoice has been created, you can modify the scheduled payment using the Scheduled Payments window to alter due dates, and to change payment and discount amounts.
Define Payment on Receipt Supplier Information
You can enter supplier information in the Oracle Payables Suppliers and Supplier Sites windows to identify which of your suppliers are eligible for Payment on Receipt and can have their invoices automatically created using the Pay on Receipt AutoInvoice program. In addition, you can specify an alternate Payment on Receipt pay site if the supplier's pay site address is different from the purchasing address. For invoices created based on receipt transactions, you can set up invoice consolidation levels for an individual pay site. You also define the default Payment Currency in the Suppliers and Supplier Sites windows.
Purchasing Region of the Suppliers and Supplier Sites windows
Create Invoices with Different Invoice Summary Levels
Based on the Supplier Site Setup
The level of invoice consolidation determines how an invoice will be created for each run of Pay on Receipt AutoInvoice program. For invoices created based on receipt transactions, you set up invoice consolidation levels for an individual pay site in the Supplier Sites window. The levels are:
'Pay Site' -- one invoice is created per supplier pay site.
'Packing Slip' -- one invoice is created per packing slip per supplier pay site.
'Receipt' -- one invoice is created per receipt per supplier pay site.
Invoice numbers are created based on the summary level. The invoice number is of the following format:
'ERS'-< X >-< Seq# >
- Seq# is a unique system generated number.
- X depends on the summary level:
- if summary level = Pay Site then X = Invoice Date
- if summary level = Packing Slip then X = Packing Slip Number
- if summary level = Receipt then X = Receipt Number
Submit Pay on Receipt AutoInvoice Program
The Pay on Receipt AutoInvoice program automatically creates an invoice batch depending on the AP system option. Invoice count and invoice total are calculated automatically.
Attention: Check that the receipts that you are interested in have been created successfully before running this program. You can do this by locating the receipt in the Receiving Transactions Summary window.
To run Evaluated Receipt Settlement:
1. Navigate to the Submit Requests window.
2. Choose Requests as the Type.
3. Choose Pay on Receipt AutoInvoice as the Name.
4. Choose the Transaction Source ERS.
5. Enter a Commit Interval. The Commit Interval is a numeric representation of the number of invoices evaluated before they are committed. For example, if you have a Commit Interval of 10, after 10 invoices have been processed, they are committed. If you then process another 5, and the process fails, only 5 will not be committed.
6. Optionally enter a Receipt Number.
Note: If the Receipt Number is null, the program will try to process all the receipts that have not been invoiced successfully. If you enter a Receipt Number, only that receipt will be processed.
7. Choose OK to begin the process.