How Disbursements Are Processed

The disbursement process starts when a source product calls Oracle Fusion Payments to process disbursements. For example, Oracle Fusion Payables uses the disbursement process to pay supplier invoices and Oracle Fusion Receivables uses it to pay customer refunds.

The disbursement process ends when either electronic payments are transmitted to a payment system or financial institution or paper payment documents, such as checks or promissory notes, are printed.

Electronic processing creates a payment file that is transmitted to a payment system or other financial institution. The file contains instructions that tell the payment system or financial institution how to remit funds. In some cases, funds are remitted electronically by an automatic deposit to a bank account. In other cases, the payment file can instruct the payment system or financial institution to issue a check for payment.

Settings That Affect Disbursements

The following settings in the header region on the Create Payment Process Profile page impact electronic disbursements:

• Payment File Format choice list: You specify the payment file format to use for the electronic payment file.

• Processing Type choice list: Electronic.

• Payment Confirmation Point choice list: Point at which a payment is confirmed. Payments can be automatically confirmed, either when the payment file is formatted or when the payment file is transmitted to the payment system.

• Allow Manual Setting of Payment Confirmation check box: You can manually confirm payments on the following pages:

  • Manage Payment Files

  • Payment File

  • Overview page in the Payments work area

The following settings in the header region on the Create Payment Process Profile page impact printed disbursements:

• Payment File Format choice list: You specify the payment file format to use for the printed payment file.

• Processing Type choice list: Printed.

• Default Payment Document choice list

• Send to File radio button: Produces a formatted output file, which is printed outside of Oracle Fusion Applications.

• Send to Printer radio button

• Automatically Print After Formatting check box

• Default Printer choice list

How Disbursements Are Processed

The following figure illustrates the flow of the disbursement process.

The following figure illustrates the flow of the payment approval process within the disbursement process.

The following table describes the action steps performed by the disbursement process, which starts in Payables and ends in Payments.

Action	Description
Create documents	Source product creates documents payable, such as invoices.
Select documents	Source product selects documents. Selected documents are grouped into a payment process request.
Submit payment process request	Payment process request is submitted to Payments for processing.
Assign bank account and payment process profile	Disbursement bank accounts, which are your company's bank accounts, and payment process profiles are assigned to documents payable within the payment process request. Payments automatically assigns these values when possible. When not possible, the application asks you to supply the values on the Assign Payment Process Attributes page.
Validate documents	Payments executes any document level validations set up on the payment method or format. Documents payable that fail validation can be automatically removed and returned to the source product. Valid documents payable continue in the disbursement process, or the payment process request can be stopped for resolution, depending on options set during the submission of the payment process request.
Create and validate payments	Payments groups like documents payable into payments, according to rules set up in the payment process profile. It then executes any payment level validations set up on the payment method or format. Payments that fail validation can be automatically removed and the documents payable returned to the source product. Valid payments continue in the disbursement process, or the payment process request can be stopped for resolution, depending on options set during the submission of the payment process request.
Review and modify payment process request	When the payment process request is submitted, it can be set to stop for review as soon as all payments pass validation. During the review, you can optionally remove payments from the payment process request or documents payable from payments. If you make any changes during the review, validations are executed again.
Approve or reject payment process request	When payment approval is enabled, the payment process stops at the Review Proposed Payments stage, and approvers can optionally remove payments directly from a payment process request and then approve it. The approval process generates and routes payment approval notifications to approvers. Approvers can approve or reject payment process requests directly from e-mails or from the Review Proposed Payments page.
Create payment file	Payments processes payments within each payment process request and groups them according to their disbursement bank accounts, payment process profiles, and other grouping rules to create payment files.
Validate payment file	Payments executes any payment file level validations set up on the format. Payment files that fail validation can be corrected by removing payments or the validation can be overridden.
Create extract and format	An extract, or XML file, is created that contains the data relevant to the payment file. Oracle Analytics Publisher applies a format template to the data in the extract. The result is a formatted file that contains data specified by the format.
Transmit payment file	If the payment process profile for a formatted payment file specifies electronic processing, the payment file is transmitted to the payment system. The payment system is a bank or other financial institution that processes the file and moves funds from the disbursement bank account to the payee bank account.
Print payment documents	If the payment process profile for a formatted payment file specifies printed processing, the payment file is printed onto payment documents, such as checks. If any checks print incorrectly, they can be reprinted. After checks print successfully, you can record the print status, which allows Payables to account for the payments.
Perform post-processing	After creating payments, you can optionally use reports as follows: Separate Remittance Advice reports can be sent to suppliers, which lists the invoices you paid. Positive Pay reports can be sent to banks to prevent fraud since unauthorized payments are not listed on the Positive Pay report. Payment file registers can be created for internal use. They display details of payments that are included in a payment file. You can retain this report for your records.