Draft Life Cycle Overview

Processing a draft normally occurs over an extended period of time. The events that occur during the draft life cycle are the same for both customer- and supplier-initiated drafts.

Each event in the draft life cycle generates accounting entries and changes the status of the draft. You initiate some of these events online and others occur automatically when you run the Receivables Update Application Engine process (ARUPDATE). PeopleSoft defines the draft processing rules for each business event that PeopleSoft Receivables supports. You define how the system creates accounting entries for each event by draft type.

The path that a draft takes in the draft life cycle depends on if the draft is:

  • Nondiscounted.

  • Discounted with recourse.

  • Discounted without recourse.

Drafts that are discounted with recourse and drafts that are discounted without recourse follow the same path but generate different accounting entries.

The following graphic shows the major events that occur in the draft life cycle, which include draft creation, draft approval. If draft is not discounted, then the draft is sent to the bank for remittance of money owed, the money is collected on due date, and are reconciled with the bank. If draft is discounted with or without recourse, the draft is sent to the bank for remittance of money owed, the money is collected on the discount date if this a discount of a draft without recourse, reconciled with the bank, and completed. If this is a discount of a draft with recourse, the draft is discounted on the discount date or when the it is reconciled with the bank and is completed on the due date.

Major events that occur in the draft life cycle, which include draft creation, draft approval. If draft is not discounted, then the draft is sent to the bank for remittance of money owed, the money is collected on due date, and are reconciled with the bank. If draft is discounted with or without recourse, the draft is sent to the bank for remittance of money owed, the money is collected on the discount date if this a discount of a draft without recourse, reconciled with the bank, and completed. If this is a discount of a draft with recourse, the draft is discounted on the discount date or when the it is reconciled with the bank and is completed on the due date

Life cycle of a draft with or without discounts.

The system keeps an audit history of all events that occur for an individual draft and records the history in the Draft Activity table (PS_DRAFT_ACTIVITY). Some events, such as the draft approval event, generate a group ID when the event occurs. For other events, such as draft remittance, the Receivables Update process assigns a group ID. The Receivables Update process also updates the activity record with the posting date.