|Oracle Credit Management User Guide|
Part Number E13502-04
This chapter describes additional setup steps to consider when implementing Oracle Credit Management.
This chapter covers the following topics:
Credit usage rule sets are used as follows:
In Oracle Order Management, credit usage rule sets define the set of currencies that will share a predefined credit limit during the credit checking process, and enable the grouping currencies for global credit checking.
In Oracle Credit Management, credit usage rule sets ensure that all transactions for the specified currencies are converted to the credit currency and included in data point calculations in the case folder.
For example, if a customer is assigned the Default profile class with a credit usage rule set that includes USD, EUR, and CAD, then any transactions of those currencies are included in that customer's case folder for data points such as Count of Open Invoices or Amount of Open Invoices.
In Oracle Credit Management, credit usage rules are required. Even if you perform credit reviews in only one currency, or conduct your business in only one currency, you must still set up one credit usage rule.
The most typical usage will be as follows:
Set up one credit usage rule set with a main currency, such as USD, and attach the currencies that you need, such as USD and CAD.
In this case, the credit application currency can be either USD or CAD.
Credit limit currency is expressed only in USD.
If you enter a CAD credit application, then all transactions in both CAD and USD are included in data point calculations.
Data points are automatically converted to USD. The credit recommendation is expressed in USD.
Perhaps you would like to maintain two different credit policies for a single customer, based on territory. In this case, credit usage rules let you set up two different credit policies and have two different credit limits. To accomplish this:
Set up one credit usage rule set with a main currency, such as USD, and attach USD and CAD. Set up another credit usage rule set with a main currency, such as EUR, and attach EUR, CHF, and SEK.
Let's say an order hold occurs on an order in SEK. The resulting currency on the credit application is SEK.
Due to the credit usage rules, Credit Management selects transactions in EUR, CHF, and SEK.
Data points are automatically converted to EUR. The credit recommendation is expressed in EUR.
Note: The previous example also applies in the case where a particular currency fluctuates to a great extent. In such a case, for the purposes of a credit review, you should isolate that currency's transactions from the rest of your customer's transactions. Otherwise, what might be a high credit score on one day could be drastically lower on another day, simply due to the one fluctuating currency.
After you set up credit usage rule sets, you then assign the rule set to a credit profile class, which you can finally assign directly to a customer.
During setup, confirm that credit usage rule sets are properly defined and assigned to your customers:
Confirm existing credit usage rule sets, or define new ones, in the Define Credit Usage Rules window.
Then, use the Assign Credit Usage Rules window to assign a credit usage rule set or sets to each combination of customer and currency, as necessary.
The currencies default from the profile amounts in the assigned customer profile class.
Note: Credit usage rules are mutually exclusive for a customer. For example, if you assign credit usage rule A (USD and CAD) to USD, then you cannot also assign the same credit usage rule to CAD.
Assign the same credit usage rule sets to the customer's sites if you plan to create credit applications for individual customer sites. Otherwise, a case folder might not be generated when you submit a credit application for the site.
See: Defining Credit Usage Rule Sets, Oracle Order Management Implementation Manual and Assigning Credit Usage Rule Sets, Oracle Order Management Implementation Manual.
Overview of Oracle Credit Management Setup
To provide global credit limits that are shared by some or all entities within a complex, multinational organization, you can define credit relationships between parties using Oracle Trading Community Architecture Relationship Manager.
Relationship Manager lets you easily build, view, and edit relationships between entities. Using Relationship Manager, you can:
View a single party and all its relationships
Create new relationships and edit existing relationships
Focus on a particular portion of a hierarchy and edit the hierarchical structure
You can define a credit hierarchy of parties, party relationships, hierarchy levels, accounts, and account sites. Typically, the party object and party subject in a credit relationship represent a parent and child, or HQ and division hierarchy. For each entity in the hierarchy, you can view credit information, such as credit hold status, credit limits by currency, and credit review cycle.
Using Relationship Manager, you assign to your entities an existing relationship type, such as Global Ultimate, or your own user-defined Credit Management relationship type. You then link the relationships to Credit Management by assigning the relationship type to the AR: Credit Hierarchy Type profile option.
When you conduct a credit review for an entity that has hierarchical relationships, Credit Management consolidates and displays all data for the entire hierarchy.
Profile Options and Profile Option Categories Overview
Overview of Oracle Credit Management Setup
Relationship Manager Overview, Oracle Trading Community Architecture User Guide
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