Oracle® Fusion
Applications
Financials Implementation Guide 11g Release 6 (11.1.6) Part Number E20375-07 |
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This chapter contains the following:
Predefined Receivables Data in Subledger Accounting: Explained
Simple Configuration to Operate Receivables: Explained
Notes Mapping for Receivables: Explained
Oracle Fusion Receivables provides predefined data for Oracle Fusion Subledger Accounting that you can use to integrate the two applications.
When you run Create Receivables Accounting, the program accepts the default accounting information from AutoAccounting without change and uses the predefined data to create accounting in the subledger. Subledger Accounting transfers the final accounting to Oracle Fusion General Ledger.
Note
You can optionally define your own subledger accounting rules to overwrite the default accounts from the accounting events.
Receivables predefines one application in Subledger Accounting named Receivables. Most of the data that Receivables predefines for Subledger Accounting is associated with the Receivables application.
This table shows the attribute values that Receivables predefines for the Receivables application:
Field |
Value |
---|---|
Application Name |
Receivables |
Drilldown Procedure |
AR_DRILLDOWN_PUB_PKG.DRILLDOWN |
Use Security |
Yes |
Policy Function |
XLA_SECURITY_POLICY_PKG.MO_POLICY |
Journal Source |
Receivables |
Third Party Control Account Type |
Customer |
Subject to Validation |
No |
Calculate Reporting Currency Amounts |
Yes |
This table lists the setup information that Receivables predefines for the event entities:
Application |
Entity Name |
Description |
Gapless Event Processing |
---|---|---|---|
Receivables |
Adjustments |
Adjustments |
No |
Receivables |
Receipts |
Receipts |
No |
Receivables |
Transactions |
Transactions |
No |
Receivables predefines process categories for the Receivables application. These process categories are:
Adjustments
Miscellaneous Receipts
Standard Receipts
Third Party Merge
Transactions
Additional considerations for Receivables predefined data for subledger accounting include:
Event Classes and Event Class Options
Sources, Source Assignments, and Accounting Attribute Assignments
Journal Line Types
Account Derivation Rules
Journal Lines Definitions
Application Accounting Definition
Receivables predefines event classes for each event entity that belongs to the Receivables application.
This table lists the event classes that Receivables predefines for the Receivables application:
Entity |
Event Class Name |
---|---|
Adjustments |
Adjustment |
Receipts |
Miscellaneous Receipt |
Receipts |
Receipt |
Transactions |
Chargeback |
Transactions |
Credit Memo |
Transactions |
Debit Memo |
Transactions |
Invoice |
Accounting event class options define attributes of an event class. Receivables defines the accounting event class options for each predefined event class.
This table lists the accounting event class options that Receivables predefines for the Receivables application:
Event Class |
Process Category |
Default Journal Category |
Transaction View |
Balance Types |
---|---|---|---|---|
Adjustment |
Adjustments |
Adjustment |
AR_ADJ_INF_V |
Actual |
Miscellaneous Receipt |
Miscellaneous Receipts |
Misc Receipts |
AR_CR_INF_V |
Actual |
Receipt |
Standard Receipts |
Receipts |
AR_CR_INF_V |
Actual |
Chargeback |
Transactions |
Chargebacks |
AR_TRX_INF_V |
Actual |
Credit Memo |
Transactions |
Credit Memos |
AR_TRX_INF_V |
Actual |
Debit Memo |
Transactions |
Debit Memos |
AR_TRX_INF_V |
Actual |
Invoice |
Transactions |
Sales Invoices |
AR_TRX_INF_V |
Actual |
Receivables predefines sources, source assignments, and accounting attribute assignments for Subledger Accounting.
You cannot make changes to predefined sources, source assignments, or accounting attribute assignments. However, you can define your own custom sources.
If you choose to define your own journal line types or application accounting definitions, you can override the default accounting attribute assignments.
Receivables predefines journal line types for each predefined event class. Receivables specifies conditions for the use of each journal line type.
This table lists the journal line types that Receivables predefines for the Receivables application:
Event Class |
Name |
Balance Type |
Side |
---|---|---|---|
Adjustment |
Adjustment |
Actual |
Credit |
Adjustment |
Adjustment Charge |
Actual |
Credit |
Adjustment |
Adjustment Default Receivable |
Actual |
Credit |
Adjustment |
Adjustment Deferred Tax |
Actual |
Credit |
Adjustment |
Adjustment Charge Nonrecoverable Tax |
Actual |
Credit |
Adjustment |
Adjustment Nonrecoverable Tax |
Actual |
Credit |
Adjustment |
Adjustment Tax |
Actual |
Credit |
Chargeback |
Chargeback Default Receivable |
Actual |
Debit |
Chargeback |
Chargeback Revenue |
Actual |
Credit |
Credit Memo |
Credit Memo Default Deferred Tax Application |
Actual |
Credit |
Credit Memo |
Credit Memo Default Application |
Actual |
Credit |
Credit Memo |
Credit Memo Default Tax Application |
Actual |
Credit |
Credit Memo |
Credit Memo Refund Application |
Actual |
Credit |
Credit Memo |
Credit Memo Charges |
Actual |
Credit |
Credit Memo |
Credit Memo Default Receivable |
Actual |
Debit |
Credit Memo |
Credit Memo Default Revenue |
Actual |
Credit |
Credit Memo |
Credit Memo Default Tax |
Actual |
Credit |
Credit Memo |
Credit Memo Rounding |
Actual |
Credit |
Credit Memo |
Credit Memo Unbilled Receviable |
Actual |
Credit |
Credit Memo |
Credit Memo Deferred Revenue |
Actual |
Credit |
Debit Memo |
Debit Memo Charges |
Actual |
Credit |
Debit Memo |
Debit Memo Default Receivable |
Actual |
Debit |
Debit Memo |
Debit Memo Freight |
Actual |
Credit |
Debit Memo |
Debit Memo Revenue |
Actual |
Credit |
Debit Memo |
Debit Memo Rounding |
Actual |
Credit |
Debit Memo |
Debit Memo Tax |
Actual |
Credit |
Debit Memo |
Debit Memo Unbilled Receivable |
Actual |
Debit |
Debit Memo |
Debit Memo Deferred Revenue |
Actual |
Credit |
Invoice |
Invoice Charges |
Actual |
Credit |
Invoice |
Invoice Default Receivable |
Actual |
Debit |
Invoice |
Invoice Freight |
Actual |
Credit |
Invoice |
Invoice Revenue |
Actual |
Credit |
Invoice |
Invoice Rounding |
Actual |
Credit |
Invoice |
Invoice Tax |
Actual |
Credit |
Invoice |
Invoice Unbilled Receivable |
Actual |
Credit |
Invoice |
Invoice Deferred Revenue |
Actual |
Credit |
Miscellaneous Receipt |
Miscellaneous Receipt Bank Charges |
Actual |
Credit |
Miscellaneous Receipt |
Miscellaneous Receipt Cleared Cash |
Actual |
Credit |
Miscellaneous Receipt |
Miscellaneous Receipt Confirmed Cash |
Actual |
Credit |
Miscellaneous Receipt |
Miscellaneous Receipt Short Term Debt |
Actual |
Credit |
Miscellaneous Receipt |
Miscellaneous Receipt Factored Cash |
Actual |
Credit |
Miscellaneous Receipt |
Miscellaneous Receipt Miscellaneous Cash |
Actual |
Credit |
Miscellaneous Receipt |
Miscellaneous Receipt Remitted Cash |
Actual |
Credit |
Miscellaneous Receipt |
Miscellaneous Receipt Tax |
Actual |
Credit |
Receipt |
Receipt On Account Application |
Actual |
Credit |
Receipt |
Receipt Application to Freight |
Actual |
Credit |
Receipt |
Receipt Application to Revenue |
Actual |
Credit |
Receipt |
Receipt Application to Rounding |
Actual |
Credit |
Receipt |
Receipt Application to Suspense Revenue |
Actual |
Credit |
Receipt |
Receipt Application to Tax |
Actual |
Credit |
Receipt |
Receipt Application to Unbilled Revenue |
Actual |
Credit |
Receipt |
Receipt Application to Earned Revenue |
Actual |
Credit |
Receipt |
Receipt Bank Charges |
Actual |
Credit |
Receipt |
Receipt Cleared Cash |
Actual |
Credit |
Receipt |
Receipt Credit Card Chargeback Application |
Actual |
Credit |
Receipt |
Receipt Chargeback Application |
Actual |
Credit |
Receipt |
Receipt Confirmed Cash |
Actual |
Credit |
Receipt |
Receipt Currency Rounding |
Actual |
Credit |
Receipt |
Receipt Short Term Debt |
Actual |
Credit |
Receipt |
Receipt Default Application |
Actual |
Credit |
Receipt |
Receipt Deferred Tax |
Actual |
Credit |
Receipt |
Receipt Earned Discount |
Actual |
Credit |
Receipt |
Receipt Earned Discount on Freight |
Actual |
Debit |
Receipt |
Receipt Earned Discount Nonrecoverable Tax |
Actual |
Credit |
Receipt |
Receipt Earned Discount on Revenue |
Actual |
Debit |
Receipt |
Receipt Earned Discount on Tax |
Actual |
Debit |
Receipt |
Receipt Exchange Gain |
Actual |
Credit |
Receipt |
Receipt Exchange Gain Loss |
Actual |
Gain/Loss |
Receipt |
Receipt Exchange Loss |
Actual |
Credit |
Receipt |
Receipt Factored Cash |
Actual |
Credit |
Receipt |
Receipt Payment Netting Application |
Actual |
Credit |
Receipt |
Receipt Prepayment Application |
Actual |
Credit |
Receipt |
Receipt Refund Application |
Actual |
Credit |
Receipt |
Receipt Remitted Cash |
Actual |
Credit |
Receipt |
Receipt Tax |
Actual |
Credit |
Receipt |
Receipt Unapplied Cash |
Actual |
Debit |
Receipt |
Unapplied Cash |
Actual |
Debit |
Receipt |
Receipt Unapplied for Gain Loss lines |
Actual |
Debit |
Receipt |
Receipt Unearned Discount |
Actual |
Credit |
Receipt |
Receipt Unearned Discount on Freight |
Actual |
Debit |
Receipt |
Receipt Unearned Discount on Nonrecoverable Tax |
Actual |
Credit |
Receipt |
Receipt Unearned Discount on Revenue |
Actual |
Debit |
Receipt |
Receipt Unearned Discount on Tax |
Actual |
Debit |
Receipt |
Receipt Unidentified Cash |
Actual |
Credit |
Receipt |
Receipt Write-Off Application |
Actual |
Credit |
Receivables predefines account derivation rules. When Subledger Accounting uses the predefined account derivation rules that Receivables provides, it accepts the default accounting that Receivables generates using AutoAccounting without change.
You can optionally define your own account derivation rules for an Accounting Flexfield or for a segment. In this case, Subledger Accounting overrides the default accounts that Receivables generates, or individual segment values in the default accounts, when it creates the draft or final subledger accounting.
The name account derivation rules that Receivables predefines for the Receivables application are as follows:
Credit Memo Distribution GL Account
Collection Bank Charges Account
Collection Bank Account Cash Account
Collection Bank Factoring Charges Account
Distribution GL Account
Remit Bank Unapplied Account
System Gain GL Account
System Loss GL Account
Transaction Distribution GL Account
Transaction Distribution GL Account with reference
Receivables predefines journal lines definitions that group the predefined journal line types and account derivation rules within each of the predefined event types. Receivables assigns each predefined journal lines definition to all event types within an event class.
This table lists the journal lines definitions that Receivables predefines for the Receivables application:
Event Class |
Journal Lines Definition Name |
Journal Line Types |
---|---|---|
Adjustment |
Adjustments - Default Accrual |
Adjustment, Adjustment Charge, Adjustment Charge Nonrecoverable Tax, Adjustment Default Receivable, Adjustment Deferred Tax, Adjustment Nonrecoverable Tax, Adjustment Tax |
Chargeback |
Chargebacks - Default Accrual |
Chargeback Default Receivable, Chargeback Revenue |
Credit Memo |
Credit Memos - Default Accrual |
Credit Memo Charges, Credit Memo Default Application, Credit Memo Default Deferred Tax Application, Credit Memo Default Receivable, Credit Memo Default Revenue, Credit Memo Default Tax, Credit Memo Default Tax Application, Credit Memo Deferred Revenue, Credit Memo Refund Application, Credit Memo Rounding, Credit Memo Unbilled Receivable |
Debit Memo |
Debit Memos - Default Accrual |
Debit Memo Charges, Debit Memo Default Receivable, Debit Memo Deferred Revenue, Debit Memo Freight, Debit Memo Revenue, Debit Memo Rounding, Debit Memo Tax, Debit Memo Unbilled Receivable |
Invoice |
Invoices - Default Accrual |
Invoice Charges, Invoice Default Receivable, Invoice Deferred Revenue, Invoice Freight, Invoice Revenue, Invoice Rounding, Invoice Tax, Invoice Unbilled Receivable |
Miscellaneous Receipt |
Miscellaneous Receipts |
Miscellaneous Receipt Bank Charges, Miscellaneous Receipt Cleared Cash, Miscellaneous Receipt Confirmed Cash, Miscellaneous Receipt Factored Cash, Miscellaneous Receipt Miscellaneous Cash, Miscellaneous Receipt Remitted Cash, Miscellaneous Receipt Short Term Debt, Miscellaneous Receipt Tax |
Receipt |
Receipts - Default Accrual |
Receipt Bank Charges, Receipt Chargeback Application, Receipt Cleared Cash, Receipt Confirmed Cash, Receipt Credit Card Chargeback Application, Receipt Currency Rounding, Receipt Default Application, Receipt Deferred Tax, Receipt Earned Discount, Receipt Earned Discount Nonrecoverable Tax, Receipt Exchange Gain Loss, Receipt Factored Cash, Receipt On Account Application, Receipt Payment Netting Application, Receipt Prepayment Application, Receipt Refund Application, Receipt Remitted Cash, Receipt Short Term Debt, Receipt Tax, Receipt Unapplied Cash, Receipt Unearned Discount, Receipt Unearned Discount on Nonrecoverable Tax, Receipt Unidentified Cash, Receipt Write-Off Application, Unapplied Cash |
Receipt |
Receipt - Basis Journal Lines Definition |
Receipt Application to Earned Revenue, Receipt Application to Freight, Receipt Application to Revenue, Receipt Application to Rounding, Receipt Application to Suspense Revenue, Receipt Application to Tax, Receipt Application to Unbilled Revenue, Receipt Bank Charges, Receipt Cleared Cash, Receipt Confirmed Cash, Receipt Currency Rounding, Receipt Earned Discount, Receipt Earned Discount on Freight, Receipt Earned Discount on Revenue, Receipt Earned Discount on Tax, Receipt Exchange Gain Loss, Receipt Factored Cash, Receipt On Account Application, Receipt Payment Netting Application, Receipt Prepayment Application, Receipt Refund Application, Receipt Remitted Cash, Receipt Short Term Debt, Receipt Unapplied Cash, Receipt Unapplied for Gain Loss lines, Receipt Unearned Discount, Receipt Unearned Discount on Freight, Receipt Unearned Discount on Revenue, Receipt Unearned Discount on Tax, Receipt Unidentified Cash, Receipt Write-Off Application, Unapplied Cash |
Receivables predefines the Receivables Default Accrual application accounting definition.
This table lists the assignments for the Receivables Default Accrual application accounting definition that Receivables predefines for the Receivables application:
Event Class Assignments |
Event Type Assignments |
Create Accounting |
Journal Line Definition Assignments |
---|---|---|---|
Adjustment |
All |
Yes |
Adjustments - Default Accrual |
Chargeback |
All |
Yes |
Chargebacks - Default Accrual |
Credit Memo |
All |
Yes |
Credit Memos - Default Accrual |
Debit Memo |
All |
Yes |
Debit Memos - Default Accrual |
Invoice |
All |
Yes |
Invoices - Default Accrual |
Miscellaneous Receipt |
All |
Yes |
Miscellaneous Receipts |
Receipt |
All |
Yes |
Receipts - Default Accrual |
Note
Subledger Accounting provides a predefined subledger accounting method that groups the predefined application accounting definitions for subledger applications. You can optionally create your own subledger accounting method.
Receivables assigns the predefined Receivables Default Accrual application accounting definition to the predefined Standard Accrual subledger accounting method. You can assign this subledger accounting method to your ledgers.
You can create an operational Oracle Fusion Receivables environment with seven configurations. The remaining configurations are either optional or have predefined values.
If applicable, your Receivables configuration must include a plan to migrate your customer information from your legacy system.
There are seven configuration tasks necessary to create an operational Receivables environment. Before you perform these tasks, you must ensure that you have completed all of the required implementation tasks for Oracle Fusion Financials.
Perform these seven tasks in the order indicated:
Set Receivables System Options
Set Receivables system options to customize your Receivables environment. During Receivables setup, you specify your accounts, customer and invoice parameters, and how the AutoInvoice and Automatic Receipts programs operate.
Define Receivables Activities
Define receivables activities to default accounting information for the activities you need, such as miscellaneous cash, discounts, late charges, adjustments, and receipt write-off applications.
Define AutoAccounting Rules
Defining AutoAccounting is a required configuration task for processing customer billing.
Define AutoAccounting to specify how you want Receivables to determine the default general ledger accounts for transactions. Receivables creates default accounts for revenue, receivable, freight, tax, unearned revenue, unbilled receivables, late charges, and AutoInvoice clearing (suspense) accounts using this information.
Define Receipt Classes and Methods
Defining receipt classes and receipt methods is a required configuration task for processing customer payments.
Receipt classes determine the required processing steps for receipts to which you assign receipt methods with this class. These steps include confirmation, remittance, and clearance. Receipt methods specify accounting for receipt entries and applications, determine customer remittance bank account information, and configure automatic receipt processing and fund transfer error handling.
Define Remit-to Addresses
Define remit-to addresses to let your customers know where to send payment for open receivables. Receivables uses the addresses to provide default remit-to information when you enter transactions.
You must provide a remit-to address to complete a transaction.
If you use AutoInvoice, but have not defined a remit-to address for a particular customer site, AutoInvoice rejects all transactions for which it could not determine a remit-to address.
Define Approval Limits
Define approval limits to determine whether a Receivables user can approve adjustments or credit memo requests. You define approval limits by document type, amount, reason code, and currency.
Define Statement Cycles
Define statement cycles to control when you create customer statements. You assign statement cycles to customer profiles.
The Notes common component portlet is available on all Oracle Fusion Receivables transaction pages. You can create, view, update and delete notes on transactions throughout the entire transaction cycle: incomplete, complete, posted.
There are two types of Notes: Internal and Private. Internal notes are available to all users. Private notes are available to authors only.
There are three configuration tasks to perform to use the Notes portlet on Receivables transactions.
There are three configuration tasks for Notes mapping to Receivables.
Perform these tasks in the order indicated:
Manage Receivables Note Type
Define the lookups you need for the Note Type.
Manage Receivables Note Type Mapping
Use the CRM component to map the Note Type to the Receivables Transaction object (AR_TRANSACTIONS).
This table displays the predefined note type mapping for Receivables:
OBJECT_CODE |
MAPPING_TYPE_CODE |
MAPPED_LOOKUP_CODE |
Meaning |
Description |
---|---|---|---|---|
AR_TRANSACTION |
ZMM_NOTE_TYPE |
MAINTAIN (default) |
Maintain |
Maintain Receivables transactions |
AR_TRANSACTION |
ZMM_NOTE_TYPE |
AR_APPROVAL |
Receivables Credit Memo Request Approval |
Receivables credit memo request approval note type |
Manage Receivables Note Descriptive Flexfields
You can optionally define descriptive flesfields for Notes. You can use Notes descriptive flexfields on Receivables transactions to capture additional information for your business requirements.
Receivables activity types provide the default accounting information for each corresponding activity that take place in Oracle Fusion Receivables.
Using Receivables Activity Types
Adjustment
You use activities of this type when creating adjustments. You must create at least one activity of this type.
There are also three related activities that are reserved for internal use only:
Chargeback Adjustment
Adjustment Reversal
Chargeback Reversal
You must define general ledger accounts for the Chargeback Adjustment activity before creating chargebacks.
When you reverse a receipt, if an adjustment or chargeback exists, Receivables automatically generates off-setting adjustments using the Adjustment Reversal and Chargeback Reversal activities.
Bank Error
You use activities of this type when entering miscellaneous receipts. You can use this type of activity to help reconcile bank statements using Oracle Fusion Cash Management.
Credit Card Chargeback
You use activities of this type when recording credit card chargebacks. You must define a general ledger clearing account for the Credit Card Chargeback activity that Receivables provides before recording credit card chargebacks.
Receivables credits the clearing account when you apply a credit card chargeback, and then debits the account after generating the negative miscellaneous receipt. If you later determine the chargeback is invalid, then Receivables debits the clearing account when you unapply the credit card chargeback, and then credits the account after reversing the negative miscellaneous receipt. Only one Credit Card Chargeback activity within a business unit can be active at a time.
Credit Card Refund
You use activities of this type when processing refunds to customer credit card accounts. This activity includes information about the general ledger clearing account to use to clear credit card refunds. You must create at least one activity of this type to process credit card refunds.
Earned Discount
You use activities of this type to adjust a transaction if payment is received within the discount period, as determined by the payment terms on the transaction.
Late Charges
You use activities of this type to define a late charge policy. You must define a Late Charges activity if you record late charges as adjustments against overdue transactions. If you assess penalties in addition to late charges, then define a separate Late Charges activity for penalties.
Miscellaneous Cash
You use activities of this type when entering miscellaneous receipts. The Miscellaneous Cash activity use a distribution set to automatically distribute miscellaneous cash across various accounts. You must create at least one activity of this type.
If the Tax Rate Code Source for this activity is Activity, then you must define asset and liability tax rate codes to account for tax on miscellaneous receipts and miscellaneous payments.
Payment Netting
You use activities of this type when applying a receipt against other open receipts. You must define a general ledger clearing account to use when offsetting one receipt against another receipt. Only one Payment Netting activity within a business unit can be active at a time.
Prepayments
You use activities of this type when creating prepayment receipts. You must define a general ledger account for prepayment receipts that use the Prepayments activity. Only one Prepayments activity within a business unit can be active at a time.
Receipt Write-off
You use activities of this type when writing off receipts. You must define the general ledger account to credit when you write off an unapplied amount or an underpayment on a receipt.
Refund
You use activities of this type to process automated non-credit card refunds. You must define the general ledger clearing account to use to clear refunds. You must create at least one activity of this type. Only one Refund activity within a business unit can be active at a time.
Unearned Discount
You use activities of this type to adjust a transaction if payment is received after the discount period, as determined by the payment terms on the transaction.
When you define a receivables activity, you use the GL Account Sourceto indicate how Oracle Fusion Receivables derives the accounts for the expense or revenue generated by the activity.
GL Account Source Options
Activity GL Account
Allocate the expense or revenue to the general ledger account that you specify for the receivables activity. If the activity type is Bank Error, Late Charges, Prepayments, and Receipt Write-off, you can only select this option.
Distribution Set
Allocate the expense or revenue to the distribution set that you specify. This value is only used with Miscellaneous Cash activities.
Revenue on Invoice
Allocate the expense or revenue net of any tax to the revenue accounts specified on the invoice. If Tax Rate Code Sourceis set to None, allocate the gross amount to these accounts. You can only choose this option if the activity type is Adjustment, Earned Discount, or Unearned Discount.
If the revenue on the invoice is unearned, then AutoAccounting derives the anticipated revenue accounting distribution accounts and amounts. Receivables then uses this information to allocate the adjustment or discount amount to these derived revenue accounts.
Tax Rate Code on Invoice
Allocate the net portion using the expense/revenue accounts specified by the tax rate code on the invoice. If Tax Rate Code Sourceis set to None, allocate the gross amount to these accounts. You can only choose this option if the activity type is Adjustment, Earned Discount, or Unearned Discount.
Note
In the event of an adjustment to an invoice with zero amount revenue distributions, the adjustment activity GL Account Sourcemust not be set to Revenue on Invoice or Tax Rate Code on Invoice.
When you define a receivables activity, you use the Tax Rate Code Sourceto indicate how Oracle Fusion Receivables derives the tax rate code for an activity.
Tax Rate Code Source Options
None
Allocates the entire tax amount according to the GL Account Sourceyou specified. You use this option if you do not want to account for tax separately.
Activity
Allocate the tax amount to the asset or liability tax accounts specified by the activity.
Invoice
Distribute the tax amount to the tax accounts specified by the tax rate code on the invoice. You cannot choose this option if the activity type is Miscellaneous Cash or Late Charges.
Note
In the event of a tax adjustment to an invoice with zero amount tax distributions, the adjustment activity Tax Rate Code Sourcemust not be set to Invoice.
If the Tax Rate Code Sourceis Activity or Invoice, you must indicate whether tax for this activity is recoverable or non-recoverable.
You create an AutoCash rule set from a combination of the five AutoCash rules. You enter the rules in the order in which you want Oracle Fusion Receivables to use them to apply a receipt to an open debit item.
The AutoCash rules are:
Match Payment with Invoice
Clear the Account
Clear Past Due Invoices
Clear Past Due Invoices Grouped by Payment Terms
Apply to the Oldest Invoice First
When you apply a receipt, Receivables uses the first rule in AutoCash rule set. If the first rule in the set does not find a match, Receivables uses the next rule in the sequence, and so on until it can apply the receipt.
These examples illustrate how each rule applies receipts to transactions and updates customer balances.
The Match Payment with Invoice rule applies a receipt to a single invoice, debit memo, or chargeback only if the receipt amount exactly matches the amount of the debit item. If more than one debit item has an open amount that matches the receipt amount, Receivables applies the receipt to the item with the earliest due date. If more than one debit item has the same amount and due date, Receivables applies the receipt to the item with the lowest payment schedule ID number (internal identifier).
Receivables uses the values specified for the AutoCash rule set open balance calculation and the number of discount grace days assigned to the customer profile to determine the remaining amount due on the debit item. The rule ignores the value of the Apply partial receipts option.
For example, consider the following scenario:
Item/Option |
Value |
---|---|
Discounts |
Earned Only |
Late Charges |
No |
Receipt |
$1800 |
Receipt Date |
14-JAN-03 |
Discount Grace Days |
5 |
The invoice details are:
Invoice Number |
Invoice Amount |
Discount |
Payment Terms |
Invoice Date |
Due Date |
---|---|---|---|---|---|
600 |
$2000 |
$20 |
10% 10/Net 30 |
01-JAN-03 |
30-JAN-03 |
The payment terms assigned to this invoice include a 10% discount if the invoice is paid within 10 days, and the open balance calculation on the AutoCash rule set allows for earned discounts. Even though the invoice is paid after the 10 day period, Receivables adds the 5 discount grace days, making this invoice eligible for a 10% discount.
The remaining amount due on the invoice on January 14 is $1800. Since the remaining amount due matches the receipt amount, the receipt is applied. If there had been no discount grace days, Receivables could not apply the receipt because the remaining amount of the invoice would be $2000.
The Clear the Account rule applies a receipt only if the receipt amount exactly matches the customer open balance. Receivables includes all open debit and credit items when calculating the customer open balance. Open credit items include credit memos, on-account credits, and on-account and unapplied cash. The rule ignores the value of the Apply partial receipts option.
The Clear the Account rule uses the following equation to calculate the open balance for each debit item:
Open Balance = Original Balance + Late Charges - Discount
Receivables then adds the balance for each debit item to determine the total account balance. The rule uses this equation for each invoice, chargeback, debit memo, credit memo, and application of an unapplied or on-account receipt to a debit item.
Receivables uses the values specified for the AutoCash rule set open balance calculation and the number of discount grace days assigned to the customer profile to determine the customer open balance.
For example, consider the following scenario:
Item/Option |
Value |
---|---|
Late Charges |
Yes |
Items in Dispute |
Yes |
Receipt |
$590 |
This table shows the customer activity:
Past Due Debits/Credits |
Invoice Amount |
Late Charges |
In Dispute |
---|---|---|---|
Invoice 45 |
$500 |
$40 |
Yes |
Invoice 46 |
$300 |
$0 |
N/A |
Credit Memo 100 |
$50 |
N/A |
N/A |
Unapplied Cash |
$200 |
N/A |
N/A |
Since the Late charges and Items in dispute options are enabled, the open balance for this customer is $590. Because the receipt amount matches the customer open balance, the receipt can be applied.
If the receipt amount did not exactly match the customer account balance, Receivables would use the next rule in the set to attempt to apply the receipt.
The Clear Past Due Invoices rule applies a receipt only if the receipt amount exactly matches the customer past due account balance. Receivables includes all open past due debit and credit items when calculating the past due account balance. The rule ignores the value of the Apply partial receipts option.
The Clear Past Due Invoices rule only applies the receipt to items that are currently past due. A debit item is considered past due if the invoice due date is earlier than or equal to the date of the receipt that is currently being applied. Receivables uses the receipt date for unapplied and on-account cash, and the credit memo date for credit memos and on-account credits, to determine whether to include these amounts as part of the customer past due account balance.
For example, if you apply a receipt with a receipt date of 10-JAN-03, all unapplied and on-account cash, and all credit memos and on-account credits, that have a transaction date (receipt date or credit memo date) equal to or earlier than 10-JAN-03 are included when calculating the customer past due account balance.
Receivables uses the values specified for the AutoCash rule set open balance calculation and the number of discount grace days assigned to the customer profile to determine the customer past due account balance. The settings of the Late charges and Items in dispute options may prevent a past due debit item from being closed, even if the receipt amount matches the customer past due account balance.
For example, consider the following scenario:
Item/Option |
Value |
---|---|
Late Charges |
No |
Items in Dispute |
No |
Receipt |
$420 |
This table shows the customer activity:
Past Due Debits/Credits |
Invoice Amount |
Late Charges |
In Dispute |
---|---|---|---|
Invoice 209 |
$300 |
$0 |
N/A |
Invoice 89 |
$250 |
$0 |
Yes |
Invoice 7 |
$120 |
$30 |
N/A |
Since the Late charges and Items in dispute options are not enabled, Receivables does not include Invoice 89 ($250) or late charges for Invoice 7 ($30) in the calculation of the customer past due account balance. Therefore, the past due account balance for this customer is $420. Because the receipt amount matches the customer past due account balance, the receipt is applied. However, Invoice 7 and Invoice 89 are still open, past due debit items.
The Clear Past Due Invoices Grouped by Payment Terms rule applies a receipt only if the receipt amount exactly matches the sum of the customer credit memos and past due invoices. This rule is similar to the Clear Past Due Invoices rule, but it first groups past due invoices by payment terms and uses the oldest transaction due date within the group as the group due date.
A debit item is considered past due if the invoice due date is earlier than the date of the receipt that is currently being applied. For credit memos, Receivables uses the credit memo date to determine whether to include these amounts in the customer account balance.
For example, if you apply a receipt with a receipt date of 10-JAN-03, credit memos that have a transaction date equal to or earlier than 10-JAN-03 are included. Credit memos do not have payment terms, so they are included in each group.
Receivables uses the values specified for the AutoCash rule set open balance calculation and the number of discount grace days assigned to the customer profile to determine the sum of the customer credit memos and past due invoices. The settings of the Late charges and Items in dispute options may prevent a past due debit item from being closed, even if the receipt amount matches the sum of the customer credit memos and past due invoices.
For example, consider a $900 receipt applied on 25-JUN. This table shows the related customer activity:
Transaction Number |
Payment Terms |
Due Date |
Invoice Amount |
---|---|---|---|
1 |
A |
25-MAY |
$500 |
2 |
A |
25-JUN |
$200 |
3 |
A |
25-JUN |
$200 |
4 |
B |
20-JUN |
$900 |
5 |
C |
25-MAY |
$905 |
Receivables groups these transactions as follows:
Group 1: Transactions 1,2,3Amount: $900Group Due Date: 25-MAY
Group 2: Transaction 4Amount: $900Group Due Date: 20-JUN
Group 3: Transaction 5Amount: $905Group Due Date: 25-MAY
Since both Groups 1 and 2 match the receipt amount, Receivables selects the group with the oldest due date (Group 1) and applies the receipt to the transactions in this group.
The Apply to the Oldest Invoice First rule applies receipts to customer debit and credit items, starting with the item with the oldest due date. Receivables uses the values specified for the AutoCash rule set open balance calculation to determine the oldest outstanding item for the customer.
For example, consider the following scenario:
Item/Option |
Value |
---|---|
Apply Partial Receipts |
Yes |
Late Charges |
No |
Receipt |
$200 |
This table shows the customer activity:
Invoice Number |
Invoice Amount |
Late Charges |
Due Date |
---|---|---|---|
801 |
$0 |
$35 |
01-DEC-02 |
707 |
$450 |
$0 |
01-JAN-03 |
If you compare only the due dates for the two invoices, invoice 801 is the oldest invoice. However, Receivables also checks the open balance calculation and automatic matching rule options for the AutoCash rule set. Since the Late charges option is not enabled, Receivables ignores invoice 801 (because the remaining amount only consists of late charges) and applies the $200 receipt to invoice 707.
If the Apply partial receipts option were not enabled, Receivables could not apply this receipt and would look at the next rule in the sequence.
This example demonstrates how to create and use an AutoCash rule set. You create an AutoCash rule set to manage the payments received from Global Freight Carriers. You have an earned discount arrangement with this company but with no payment or discount grace days, and you do not add late charges for payments received beyond the due date.
Create the AutoCash Rule set using these values:
Field |
Value |
---|---|
Open Balance Calculation: Discounts |
Earned Only |
Open Balance Calculation: Late Charges |
No |
Open Balance Calculation: Items in Dispute |
No |
Automatic Matching Rules: Apply Partial Receipts |
Yes |
Automatic Matching Rules: Remaining Remittance Amount |
On Account |
AutoCash Rule |
1. Match Payment with Invoice |
AutoCash Rule |
2. Clear The Account |
AutoCash Rule |
3. Apply To The Oldest Invoice First |
Global Freight Carriers has the following outstanding invoices, none of which are in dispute:
Number |
Amount Remaining |
Due Date |
Discount Date |
Discount Amount |
---|---|---|---|---|
123 |
$200 |
11-DEC-02 |
01-DEC-02 |
$20 |
124 |
$300 |
08-DEC-02 |
30-NOV-02 |
$30 |
125 |
$150 |
13-DEC-02 |
28-NOV-02 |
$15 |
A payment was entered for Global Freight Carriers for $600 with a deposit date of 10-DEC-02.
Using the AutoCash rule set that you created, Oracle Fusion Receivables processes the payment in this way:
Receivables first applies the receipt to the oldest invoice, Invoice 124 for $300, and performs these calculations:
Since the discount date of 30-NOV-02 has passed and the Discount field is set to Earned Only, the $30 discount is no longer available. The amount due remaining for this invoice is now equal to either $0 or the amount of any late charges previously assessed for this item.
Because the Late charges option is set to No, late charges are not included in the customer open balance calculation. The remaining receipt amount is now $300.00.
Receivables now applies $200 to the next oldest invoice, Invoice 123, and performs these calculations:
As with Invoice 124, the discount date for Invoice 123 has passed and the $20 discount is no longer available. The amount due remaining for this invoice is now equal to either $0 or the amount of any late charges previously assessed for this item.
Because the Late charges option is set to No, late charges are not included in the customer open balance calculation. The remaining receipt amount is now $100.
Receivables applies the remaining $100 to Invoice 125 ($150) as a partial receipt because the Apply partial receipts option is set to Yes.
Note
If the Apply partial receipts option were set to No, Receivables could not apply the remaining amount to Invoice 125. Instead, it would be placed on account, because the Remaining Remittance Amount option is set to On Account.
As with the other invoices, the discount date for Invoice 125 has passed and the $15 discount is no longer available.
If there are no late charges for this invoice, the amount due remaining is reduced from $150 to $50, and remains open.
During payment processing, Oracle Fusion Receivables uses the Match Receipts By rules to attempt to match receipts to open transactions, and either apply receipts automatically or present recommendations for receipt application.
If transactions cannot be matched or transaction information is not available, Receivables uses the AutoCash rule set defined for the customer profile either at the customer site or customer level to apply the receipt. If the customer does not have an AutoCash rule set assigned to a profile, Receivables uses the AutoCash rule set assigned to system options and the number of discount grace days defined in the customer site or customer profile to apply the receipt.
If none of the rules in the AutoCash rule set apply, Receivables places the remaining amount either unapplied or on-account, depending on the setting of the Remaining Remittance Amount option on the AutoCash rule set.
Use the AutoCash rule set Apply partial receipts option with the Apply to the Oldest Invoice First rule. If enabled, you can apply a receipt to a transaction that is less than the amount required to close the debit item.
If the AutoCash rule set does not use partial receipts but does include late charges in the open balance calculation, then Oracle Fusion Receivables can interpret a receipt application against a transaction amount plus late charges as a partial receipt.
For example, you intend to close a $100 transaction by applying a $100 receipt, but the transaction has since accumulated a $10 late charge. If the Apply partial receipts option is not enabled, Receivables cannot apply the $100 receipt to what is now a $110 open debit item.
You can define approval limits for the users in your system for specific transactions and amount ranges per currency. The document types identify the transactions that a user can approve.
Document Types
Adjustment
Define Adjustment approval limits by currency and amount. Oracle Fusion Receivables uses approval limits that have a document type of Adjustment when you create or approve an adjustment.
When you enter an adjustment that is outside your approval limit range, Receivables assigns the adjustment a status of Pending until someone with the appropriate approval limits either approves or rejects it.
Credit Memo
Define Credit Memo approval limits by reason code, currency, and amount. The approval process sends a notification to an approver, if the credit memo request is within the approval limit range for the currency and reason code specified.
Receipt Write-off
Define Receipt Write-off approval limits by currency and amount. Receivables uses approval limits with this document type whenever you attempt to write off either an unapplied receipt amount or an underpayment on a receipt.
You cannot write off a receipt amount that is outside your approval limit range. In addition, the approval limits for write-offs are separate from, but cannot exceed, the system options write-off amounts.
Credit Memo Refund
Define Credit Memo Refund approval limits by currency and amount. Receivables uses approval limits with this document type whenever you attempt to electronically refund an on-account credit memo.
You can only assign approval limits to valid users that are defined in your system. The combination of user, document type, and currency identify a specific approval limit record. You can, for example, define multiple approval limit ranges for the same user and document type in each currency defined in your system.
Be sure to update approval limits when personnel changes occur and, for credit memo approvers, whenever you define new credit memo reason lookups.
The reason code identifies the kind of credit memo that is being requested. An approver can only approve credit memo requests with the same reason code.
Credit memo approval ranges cannot overlap for approval limits with the same reason code and currency. For example, the approval range for the primary approver JSMITH is from -200 USD to -100 USD and the reason code is Free Product. Therefore, you cannot define a credit memo approval range for the primary approver AJONES from -250 USD to -150 USD with this same reason code.
You must identify a primary approver for all approval limits with the Credit Memo document type.
Use distribution sets to account for miscellaneous, or non-invoice related, receipts. Distribution sets are groups of general ledger accounting codes that you define to determine the credit accounts for positive miscellaneous receipt amounts and the debit accounts for negative receipt amounts.