Accounts Payable Setup | Financial Options | Payables Options

By Jag - October 05, 2014
Accounts Payable Setup | Financial Options | Payables Options

Oracle Payable Set up

Define two types of Options as follows:
a. Financial Options
b. Payables Options

































Use the Financials Options window to define the options and defaults that you use for your Oracle Financial Application(s). Values you enter in this window are shared by Oracle Payables, Oracle Purchasing, and Oracle Assets. You can define defaults this window to simplify supplier entry, requisition entry, purchase order entry, invoice entry, and automatic payments. Depending on your application, you may not be required to enter all fields.
Although you only need to define these options and defaults once, you can update them at any time. If you change an option and it is used as a default value elsewhere in the system, it will only be used as a default for subsequent transactions. For example, if you change the Payment Terms from Immediate to Net 30, Net 30 will be used as a default for any new suppliers you enter, but the change will not affect the Payment Terms of existing suppliers


N: Setup > Options > Financial Options
1. Accounting Financials Options
Future Periods. Payables display the number of future periods you use in your set of books. Payables uses this value to limit the number of future periods you can maintain in the Control Payables Periods window. You can enter invoices in future periods.
GL Accounts
Liability. Payables assign this account as the default Liability Account for all new suppliers you enter. You can override this value during supplier entry. If you use Accrual Basis accounting, then the Liability Account for an invoice determines the liability account(s) charged when you create accounting entries for invoices.
Prepayment. The Prepayment account and description for a supplier site's invoices. The Financials option value defaults to new suppliers, and the supplier value defaults to new supplier sites.
Future Dated Payment. If you use future dated payments, then enter a value for Future Dated Payment account. This value defaults to all new suppliers and new bank accounts. The supplier value defaults to all new supplier sites. The bank account value defaults to new payment documents.
When Payables accounts for future dated payments, it uses the Future Dated Payment Account from either the supplier site or the payment document, depending on the option you select in the Payment Accounting region of the Payables Options window.
If you relieve liability payment time, this should be an asset account. If you relieve liability at future dated payment maturity, then this should be a liability account.
Discount Taken. If you choose to distribute your discounts to the system Discount Taken Account, Payables uses this account to record the discounts you take on payments. Use the Payables Options window to select your method for distributing discounts for your invoices.
PO Rate Variance Gain/Loss. Payables use these accounts to record the exchange rate variance gains/losses for your inventory items. The variance is calculated between the invoice and either the purchase order or the receipt, depending on how you matched the invoice. These accounts are not used to record variances for your expense items. Any exchange rate variance for your expense items is recorded to the charge account of the purchase order. Payables calculate these amounts during Payables Invoice Validation.
Expenses Clearing. This account is required when you use the Company Pay payment option of Oracle Internet Expenses. Payables use this as a temporary account to record credit card transaction activity. Payables debit this account when you create an invoice to pay a credit card issuer for credit card transactions. Payables credits this account with offsets to the original debit entries when you submit Expense Report Import for an employee expense report entered in Internet Expenses that has credit card transactions on it.
Miscellaneous. Used only when importing invoices submitted via iSupplier Portal or XML Gateway.

If you enter a value here then the system uses this account for all Miscellaneous charges on invoices your suppliers enter in iSupplier Portal. If you do not enter a value here then the system prorates Miscellaneous charges across Item lines on iSupplier Portal invoices.
The system also uses this value for any miscellaneous charges your suppliers send in XML invoices. If you do not enter a value here then import prorates miscellaneous charges across Item lines for XML invoices.
Retainage. This account is required when you use the Withholding tax supplier
Supplier - Purchasing Financials Options
The options you define in this region, except for Inventory Organization, are used as default values for the Purchasing region of the Suppliers window. The supplier values default to new supplier sites for the supplier, which default to new purchasing documents for the supplier site.
Note: If you use the Multiple Organizations Support feature, values you enter in this window will default to both the Supplier and Supplier Site.
You can override defaulted values during entry of the supplier, supplier site, and purchasing documents.


Ship-To /Bill-To Location. The name of the ship-to/bill-to location for the system default value. If the name you want does not appear in the list of values, use the Location window to enter a new location.
Inventory Organization. You need to choose an inventory organization if you use Purchasing. You can associate each of your Purchasing operating units with one inventory item master organization. When you associate your Purchasing operating unit with an inventory organization, items you define in this organization become available in Purchasing. You can only choose an inventory organization that uses the same set of books as your Purchasing operating unit. Do not change the Inventory Organization after you have already assigned one to Purchasing.
Ship Via. Freight carrier you use with suppliers. If the type of freight carrier you want does not appear in the list of values, use the Freight Carriers window to define a new shipping method. The value you enter here is the value in the Description field of the Freight Carriers window in Purchasing.
FOB. If the type of FOB you want is not in the list of values, use the Oracle Purchasing Lookups window to define a new FOB.
Freight Terms. The freight terms for a supplier identify whether you or your supplier pays for freight charges on goods you receive. You can define new freight terms in the Oracle Purchasing Lookups window


Encumbrance Financials Options
To use encumbrance accounting or budgetary control, you must install Payables, Purchasing, and General Ledger. Use this region to enable encumbrance accounting and to specify the default encumbrance types Payables assigns to your invoices, and Purchasing assigns to your requisitions and purchase orders.
If you enable encumbrance accounting or budgetary control, Purchasing creates encumbrances when you reserve funds for a requisition or purchase order. If you use the perpetual accrual method in Purchasing, Purchasing reverses purchase order encumbrances when you inspect, accept, and deliver the units. If you are using the periodic accrual method in Purchasing, Payables reverses the purchase order encumbrances when you create accounting entries for invoices.
Payables creates encumbrances when there is a variance between a matched invoice and the purchase order to which it is matched, and when the invoice encumbrance type is different from the Purchasing encumbrance type.


Oracle Financials provides two predefined encumbrance types that you can use to identify requisition, purchase order, and invoice encumbrances: Commitment and Obligation. You can define additional encumbrance types in Oracle General Ledger in the Encumbrance Types window.

























Use Requisition Encumbrance. Enable this option to encumber funds for requisitions. If you enable this option, Purchasing creates journal entries and transfers them to General Ledger to encumber funds for purchase requisitions.
Reserve at Completion. If you enable Use Requisition Encumbrance, indicate whether you want requisition preparers to have the option to reserve funds. If you do not enable this option, only requisition approvers will have the option to reserve funds.


Use PO Encumbrance. Enable this option to encumber funds for purchase orders, purchase order and receipt matched invoices, and basic invoices (not matched). If you enable this option, Purchasing encumbers funds for purchase orders and Payables encumbers funds for variances during Payables Invoice Validation for purchase order and receipt matched invoices. If you enable this option and enter a non-purchase order matched invoice, Payables will encumber funds for it during Payables Invoice Validation. All Payables encumbrances are reversed when you create accounting entries. If you enable Use Requisition Encumbrance, you must also enable this option.
























Member State. The location of your company or organization. Payables use this country name to determine if your company or organization is located in a member state of the European Union (EU).
VAT Registration Number. The Value-Added Tax (VAT) registration number for your organization. Your organization is assigned a VAT Registration Number if you register to pay VAT. The first two characters of a VAT registration number are the country code for the country or state where the registered company or organization is located. Payables print this number on the header of the Intra-EU VAT Audit Trail Report.
Human Resources Financials Options


Use this region to enter the options and defaults for entering employee information in the Enter Person window.



















Business Group. Enter the name of the business group that you want to associate with Purchasing. If you use Purchasing jointly with Oracle Human Resources, you must reference the business group that you define in Oracle Human Resources. If you use Purchasing without Human Resources, you can use the default value. The default for this field is the Human Resources default of Setup Business Group.
The business group determines which employees you can use in Purchasing. In Purchasing, you can see only the employees in this business group

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