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Oracle Public Sector Financials (International) Implementation Guide
Release 12.1
Part Number E13417-04
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Single Third Party Setup

Overview

Single Third Party treats a customer or supplier as a single entity and provides a netting facility between a single third party's receivable and payable transactions to arrive at a net balance position.

Warning: Netting is legal only in certain countries.

For information on where netting is allowed, see International Implications, Oracle Public Sector Financials (International) User Guide.

You can use the Single Third Party feature to complete these tasks:

You can use the Single Third Party feature with Oracle Applications global accounting engine to utilize the country-specific accounting rules applicable to third party transactions. The global accounting engine provides country-specific legal reports and accounting treatment, subledger transactions by control account, gapless numbering of accounting lines, and online drill-down to original subledger documents.

Related Topics

Subledger Accounting Options Setup, Oracle Subledger Accounting Implementation Guide

Netting Types

Netting Transactions and Journal Entries

Netting Transaction Class and Type Usage

Netting Security

Netting Types

The following table displays netting types supported by Single Third Party for accounts officers.

Netting Types
Netting Types Description
Objections to Payment Netting the payable invoices owed to a third party by creating an invoice for another third party called the objecting third party. This applies when payment is owed to a third party who also owes money to another third party. The objecting third party is paid the netting amount and the third party receives a net settlement.
Assignments Netting the payable invoices owed to a third party by creating an invoice for another third party, called the debt beneficiary. This applies when payment is owed to a third party who has a debt beneficiary in a factoring agreement. The debt beneficiary is paid the netting amount and the third party receives a net settlement.
Payment Excesses Netting a third party’s credits or overpayment in Receivables by refunding the overpayment in Payables.
Supplier Reimbursements Netting a third party’s credit memo in Payables by receiving a refund in Receivables.

Note: The Adjust AR Balance and Adjust AP Balance netting types are available in Receivables and Payables respectively.

Netting Transactions and Journal Entries

Single Third Party offsets a third party's outstanding balances by creating netting transactions in Payables, Receivables, or both, depending on the netting type. Single Third Party performs netting at the balance level, or at the transaction level to complete the accounting cycle of those transactions that are offset.

Related Topics

Payables and Receivables Netting, Oracle Receivables User Guide

Payables and Receivables Netting, Oracle Payables User's Guide

Netting Transaction Class and Type Usage

Single Third Party predefines the appropriate combinations of transaction classes for each netting type based on the accounting principles adopted by the French public sector.

This table shows the combinations of transaction classes supported by Single Third Party.

Netting Transactions Class and Type Usage
Netting Types Receivable Transaction Class Usage Payable Transaction Class Usage Payable Transaction Type
Objection to Payment Not Applicable Credit Memo Credit Memo
Objection to Payment Not Applicable Invoice Invoice
Assignment Not Applicable Credit Memo Credit Memo
Assignment Not Applicable Invoice Invoice
Payment Excess Debit Memo Invoice Invoice
Reimbursement Debit Memo Invoice Invoice

You can define Receivable transaction types for netting for each supported receivable transaction class. Available transaction types are those defined in the Transaction Types window in Receivables for the same transaction class.

Single Third Party uses this rule to determine the accounting flexfield used to create journal entries.

The clearing netting account is used as a clearing account for netting transactions and can be defined in the Netting Types window.

For information on defining a netting account, see Define Netting Transaction Types Procedure.

Netting Security

Single Third Party provides restrictive access to these functions:

Use the Single Third Party: Objecting STP Allowed profile option to specify whether to grant access to the functions.

Single third parties can only be entered and maintained in the Single Third Party - Main window.

Prerequisites

Before setting up Single Third Party, you must:

Related Topics

Enabling Oracle Public Sector Financials (International) Features Procedure

Defining Transaction Types, Oracle Receivables User Guide

Enabling Dynamic Inserts, Oracle Applications System Administrator's Guide

Defining Accounts, Oracle General Ledger User Guide

Document Sequences, Oracle Applications System Administrator's Guide

Specify Site-Level and Application-Level Profile Options Procedure

Profile Options

Subledger Accounting Options Setup, Oracle Subledger Accounting Implementation Guide

Single Third Party Setup Steps

This table lists the setup steps for Single Third Party.

Step Number Step Description Required or Optional
1 Set Profile Options Required
2 Define Grouping Rules Optional
3 Generate Line Transaction Flexfields Required
4 Define Transaction Types Required
5 Define Transaction Sources Required
6 Define Netting Transaction Types Required

Defining Grouping Rules

Define the transaction grouping rules for Oracle Receivables AutoInvoice to determine how lines are grouped to form a single invoice.

To define grouping rules:

  1. In Receivables, navigate to the Grouping Rules window.

  2. Create a rule called, for example, PERIODICS.

  3. For the Transaction Class of Invoice, create the following Group By rules in the Optional Grouping Characteristics region:

Related Topics

Defining AutoInvoice Grouping Rules, Oracle Receivables User Guide

Defining Transaction Types

Define at least one transaction type of invoice class for standing charges. Define at least one transaction type of class Invoice, Credit Memo, and Debit Memo for the single third party.

Define transaction types in Receivables.

Related Topics

Defining Transaction Types, Oracle Receivables User Guide

Defining Transaction Sources

Invoice sources of the type Imported are required for Single Third Party.

To define invoice batch sources in Receivables:

  1. Navigate to the Transaction Sources window.

  2. Ensure that automatic batch numbering is enabled and automatic transaction numbering is disabled.

  3. In the Name field, enter a batch source name, for example, STP NETTING.

    Note: The name defined here is used in the profile option Single Third Party: Receivables Batch Source.

    Enter these values in other fields:

    Field Value
    Type Imported
    Effective Date Valid Date
    Active Enabled
    Automatic Batch Numbering Yes
    Automatic Transaction Numbering No
  4. Select the AutoInvoice Options tab. Enter these values:

    Field Value
    Invalid Tax Rate Reject
    Invalid Line Reject Invoice
    GL Date in a Closed Period Reject
    Grouping Rule DEFAULT
  5. Select Customer Information from. Enter these values:

    Field Value
    Sold To Customer Value, ID
    Bill To Customer ID
    Bill To Address ID
    Bill To Contact None, ID
    Ship To Customer None, ID
    Ship To Address None, ID
    Ship To Contact None, ID
    Payment Method Rule ID
    Customer Bank Account ID
  6. Select Accounting Information. Enter these values:

    Field Value
    Invoicing Rule None
    Accounting Rule None
    Accounting Flexfield ID
    Derive Date Enabled
    Payment Terms ID
    Revenue Account Allocation Amount, Percent

Related Topics

Setting Up Transaction Sources in Receivables, Oracle Receivables User Guide

Defining Netting Transaction Types

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Use the Netting Transaction Types window to enable a netting types for an operating unit and to define the netting control account, document category for sequence numbering, and transaction types for the netting type.

To define netting transaction types:

  1. Navigate to the Netting Transaction Types window.

  2. Select Enabled to the right of the relevant Netting Transaction field.

    Note: A netting type cannot be enabled until all required values for the netting type definitions are entered. A netting type must be disabled before the definitions can be updated. Only enabled netting transaction types can be used for netting batch creation.

  3. The Transaction Type Usage region of the window changes depending on which netting transaction the cursor points to. The Application and Transaction Class columns are predefined and not updateable.

  4. In the Document Category Code field, select a document category code, if sequential numbering is required.

    Note: A numbering sequence for netting transactions must already be assigned to this category code in the Sequence Assignments window.

  5. Select a Receivables transaction type.

    Note: A transaction type that applies to the same transaction class must be selected. For example, the transaction type for class of debit memo must be selected when the Transaction Class Code is Debit Memo. For Payables, values are predefined as listed in the Netting Transactions Class and Type Usage table.

  6. Select a clearing netting account.

    Note: The clearing netting account for Payables and Receivables must be the same. Only one netting account is allowed for the netting type.

Related Topics

Netting Transactions Class and Type Usage