P2P Cycle
Presentation by :
Sreekanth Reddy M
Procure to Pay Lifecycle Overview
Objectives : After completing this module you should be able to do the following: • • •
Describe the procure to pay process flow Describe the key areas in the procure to pay process Describe how the procure to pay process fits into the Oracle eBusiness suite of applications
Procure to Pay Lifecycle :
The steps involved in Procure to Pay Cycle :
Oracle Modules Involved in P2P Cycle : S. No
Step
Defined At Module
1
Define items
Inventory
2
Enter item information
Purchase Order
3 4
Raise requisition
Purchase Order Purchase Order
5
Request For Quotation(RFQ) raised Quotation received
6
Quote analysis
Purchase Order
7
Raise purchase order
Purchase Order
8
Receive materials
Inventory
9
Enter invoice
Accounts payable
10
Payment process
Accounts payable
11
Transfer to general ledger
General ledger
Purchase Order
Requisition: •
Requisition is nothing but a formal request to buy something (like Inventory material, office supplies etc) needed for the enterprise. Only an employee can create one.
There are two types of requisitions: •
•
Internal Requisition: Internal requisitions provide the mechanism for requesting and transferring material from one inventory to other inventory. Purchase requisition: Unlike Internal requisitions, Purchase requisitions are used for requesting material from suppliers.
Create Requisition:
Approve Requisition:
Types of RFQ : • Catalog: Used for items that will be ordered regularly • Standard: Used for one off items or items that are ordered infrequently • Bid : used to source a specific quantity of an item to be delivered at a certain site on a certain date. RFQ Status : • In Process: Being created • Active: Ready to print • Printed : At least one copy • Closed : When you change the status to closed, the system will delete all follow-up notifications. Change the RFQ to this status when you do not want any more responses to the RFQ.
Purchase Order: There are 4 types of Purchase Orders: • Standard PO: A Standard PO is created for one–time purchase of various items. • Planned PO: A Planned PO is a long–term agreement committing to buy items or services from a single source. You must specify tentative delivery schedules and all details for goods or services that you want to buy, including charge account, quantities, and estimated cost. • Blanket agreement: A Blanket PO is created when you know the detail of the goods or services you plan to buy from a specific supplier in a period, but you do not know the detail of your delivery schedules. • Contract agreement: Contract purchase agreements are created with your suppliers to agree on specific terms and conditions without indicating the goods and services that you will be purchasing.
Create Purchase Order :
Types of Match Approval Level : • Two–Way: Purchase order and invoice quantities must match within tolerance before the corresponding invoice can be paid. • Three–Way: Purchase order, receipt, and invoice quantities must match within tolerance before the corresponding invoice can be paid. • Four–Way: Purchase order, receipt, accepted, and invoice quantities must match within tolerance before the corresponding invoice can be paid. If you enter an item, the default value for this field comes from the item information at the organization level. If not defined there, the default comes from the item information at the master level. If you do not enter an item, the default is from your Purchasing Options.
Invoice Match Option: • Purchase Order: Payables must match the invoice to the purchase order. • Receipt: Payables must match the invoice to the receipt. Choose Receipt if you want to update exchange rate information on the receipt or if you want your accounting to use exchange rate information based on the receipt date. (If you use Periodic Costing, you must match to the receipt to ensure accurate cost accounting.)The Invoice Match Option defaults from the Supplier Sites window. You can change the Invoice Match Option on the shipment until you receive against the shipment. Note: The Invoice Match Option and the Match Approval Level are independent options. You can perform whichever Invoice Match Option you want regardless of the Match Approval Level.
Approve Purchase Order :
Transmit PO to Supplier :
Receipts:
Invoicing :
Payment :
Invoice Payment – Overview :
Using the Payment Workbench :
Payment Methods :
Summary :
You should be able to do the following: • Describe the procure to pay process flow • Describe the key areas in the procure to pay process • Describe how the procure to pay process fits into the Oracle eBusiness suite of applications