TABLE OF CONTENTS

1 INTRODUCTION
2 DELTA FEATURES OF PAYABLES IN RELEASE 12
3 BASIC SETUPS OF PAYABLES
3.1 CREATE RESPONSIBILITY
3.2 2 SET OPERATING UNIT AT RESPONSIBILITY LEVEL
3.3 DEFINE OPTIONS
3.3.1 Financial Options
3.3.2 Payables System Setups
3.3.3 Payables Options
3.4 DEFINE PAYMENT TERMS
3.5 DEFINE INVOICE HOLD AND RELEASE NAMES
3.6 OPEN PAYABLES ACCOUNTING PERIOD
3.7 CREATE BANK, BRANCH AND BANK ACCOUNT
3.7.1 Create Bank
3.7.2 Create Bank Branch
3.7.3 Create Bank Account
3.8 CREATION OF SUPPLIER
3.8.1 Company Profile
3.8.2 Terms and Control

1 INTRODUCTION
Oracle Release 12.0 is designed to increase the ease with which we understand and process our worldwide business
and address compliance in every nation. It reflects the maturity of several initiatives designed to rationalize sub ledger
bookkeeping, generalize transaction tax compliance and improve access to sub ledger data, with the intention of both
facilitating sub ledger shared services and improving and standardizing throughput
Some of the new features introduced in Oracle Release 12 are:
a) Change in concept of set of books:
The ledger is a new fundamental concept in Release 12 and replaces the 11i concept of a set of books.
While a set of books is defined by 3 Cs, chart of accounts, functional currency, and accounting calendar, the
ledger is defined by an additional 4th C: the accounting method. This 4th C allows you to assign and manage
a specific accounting method for each ledger. Ledgers can be combined into ledger sets based on some
criteria, and GL users are assigned with the ledger sets.
b) Legal Entity
Business enterprises can now clearly and efficiently model its legal entities and their accounting
representations in Release 12. Therefore, when a legal entity is subject to multiple reporting requirements,
separate ledgers can be used to record the accounting information.Legal Entities can be mapped to entire
Ledgers or if you account for more than one legal entity within a ledger, you can map a legal entity to
balancing segments within a ledger.
c) Primary Ledger & Secondary Ledger:
Now there is a primary ledger to act as the main record keeping ledger and one or more secondary ledgers
to retain alternate representations for the different reporting requirements.Each secondary ledger can differ
from the primary ledger by the chart of accounts, calendar, currency, and accounting method. In R12,
Multiple Reporting Currencies (MRC) is renamed to Reporting Currencies and vastly improved the setup and
integration of reporting currencies.
d) Introduction of new segment:
In terms of management reporting, you can now designate a segment in your chart of accounts as the
management segment, such as a Dept, Line of Business, or CostCenter-something with management
responsibility. A new feature called Data Access Sets allows you to specify read only or read and write
access for a legal entity, ledger, balancing segment value or management segment value.

2 DELTA FEATURES OF
PAYABLES IN RELEASE 12
New interface for Suppliers Entry and Maintenance

Now Supply Entry and Maintenance is done through a new HTML user interface. It has an ability to tailor a
quick update page for faster maintenance. The new addition is of a survey section, which is to provide
access to supplier questionnaires.(Details are Discussed further)
Representation of Suppliers in the Trading Community Architecture (TCA)
TCA is a single repository to store information about the trading partners customers, suppliers and
organization. TCA registry ID is also gets created along with the Supplier number. Following are the features
of TCA:
Data Librarian Function & Processes
Integrated Enrichment Capabilities including D&B
Address Validation
Data Consistency
Ease of Data Maintenance
Introduction of Invoice Lines
Oracle Payables incorporates Invoice Lines into the invoice model. Adding Invoice Lines a key architectural
change, which enables Oracle Payables to better model the paper or electronic business document yet
maintain key features that exist at the invoice distributions level.
Now invoices are modeled as Headers, Lines & Distributions
Comes close to real-life Invoice Documents
Consistent AP Model Enhanced Matching
Granularity of Workflow Approval
Support Applicability Model for Tax
Better support for Corrections
Enhanced Invoice Approval Includes Line Level Approval
With the introduction of Invoice Lines, users are able to further extend their approval policy by getting
approved one specific line or set of lines for PO matched Invoices.Approvers view only the information that
they can approve or reject.
Multi-Org Access Control
MOAC is a sub feature of Access Control that enables you to define multiple Organizations and the
relationships among them within a single installation of Oracle Applications.The primary advantage of MOAC
is that you can take action on documents in different operating units without logging into different
responsibilities. Data security is maintained using security profiles that are defined for a list of operating units
for which specific users are given data access privileges.
Enhancements to Payment Banks, Branches and Accounts
Shared Service approaches to disbursement and collections are enhanced by the deployment of Oracle
Cash Managements new Bank Account model. It provides a single access point for defining and managing
internal bank accounts for Oracle Payables, Oracle Receivables, Oracle Payroll, Oracle Cash Management,
and Oracle Treasury.Banks and Bank Branches are represented in Oracles Trading Community Architecture
and shared by other Oracle E-Business Suite applications. The Bank Account is centrally defined, managed
and secured and includes the legal ownership and operating unit access for each bank account
Accounts Receivable / Accounts Payable Netting
It is a new feature in R12 which enables automatic netting of Payable and receivable transactions within a
business enterprise. It also leads to automatic creation of Payables payments and Receivables receipts to
clear a selected number of Payables and Receivables transactions.
Non PO Invoices Entered via iSupplier Portal
Invoices entered by Suppliers where a purchase order has not been obtained are represented as Invoice
Requests. Invoice Requests are visible in Oracle Payables but are not paid or accounted until the invoice
can be verified and approved

3 BASIC SETUPS OF
PAYABLES
3.1 CREATE RESPONSIBILITY
First of all, create an Accounts Payables responsibility.
Navigation ->>System administrator ->>Security ->> Responsibility->> Define
Open the form; enter the new responsibility name along with the other mandatory information and save it.

3.2 SET OPERATING UNIT AT

RESPONSIBILITY LEVEL
Attach the "Payables responsibility" responsibility with the MO Operating Unit Profile.
Navigation ->>Systemadministrator ->>Profile ->> System
Open the form, check responsibility box and enter the name of responsibility. Then enter profile name and click on
find. MO: Operating Unit Profile option is used if the user is to be given the access to only one OU as against MO:
security Profile for Multiple OU access.

Attach the "Payables responsibility" with the HR Business group & HR security profile, in the same way as we have
done above.
HR Business group

HR security profile

3.3 DEFINE OPTIONS

3.3.1 Financial Options
Define defaults values to simplify supplier entry, requisition entry, purchase order entry, invoice entry, and automatic
payments. Depending on the application, all fields may not be required to be entered.
1) Follow the navigation path
Navigation ->>Payables Responsibility ->> Setup ->>Options ->> Financials Options
2) Enter the account information into the Accounting tab.
FIELDS
DATA
Operating Unit
Liability Account
Discount Account

Specify an Operating Unit.

This account is assigned as the default Liability Account for all newly entered
suppliers.
This account is used to record the discounts taken on payments.

3) Enter the required information in the Supplier Purchasing tab.

3.3.2 Payables System Setups

1) Follow the navigation path
Navigation-Payables Responsibility ->>Setup ->>Options ->>Payables System Setup
2) Enter the required information into the relevant fields
FIELDS
DATA

Supplier number entry

Invoice Match Option
Terms Date Basis

Select an option to enter the supplier numbers manually or Let Payables automatically
generate sequential supplier numbers.
Select Purchase Order or Receipts to indicate how to match most invoices.
Select the date that System uses as the payment terms start date when Payables calculates
the due and discount dates for invoice scheduled payments. This value defaults to new
suppliers that you enter.

3.3.3 Payables Options

1) Follow the navigation path
NavigationPayables Responsibility ->>Setup ->>Options ->>Payables Options
2) Enable the required fields the Accounting Option tab

3) Enable "Use Multiple currencies" option to enter and pay invoices in a currency different from the functional
currency.
FIELDS
DATA
Realized Gain /Loss Account

If the exchange rate changes between invoice entry and payment, Payables
automatically calculates the realized gain or loss and records it in this account.

4) Enable the Options in the different tabs as per the specific requirements.

5) Check the check boxes to define at which point matching is to be done. Example check the check box Allow
distribution level matching if we want matching is to be done at each distribution line separately.

6) Enable 'Automatically create employee as supplier' so that an employee will become a supplier while entering the
employee expense report.

7) Enable the 'Use withholding tax' option to hold some part of an invoice as an advance tax.

3.4 DEFINE PAYMENT TERMS

Define payment terms that can be assigned to an invoice to automatically create scheduled payments.Payment terms
can be defined to create multiple scheduled payment lines and multiple levels of discounts. Each payment terms line
also defines the due or discount amount on a scheduled payment. While defining payment terms, specify payment
amounts either by percentages or by fixed amounts.
Example of single discount payment term: 2% discount will be given by supplier, if invoice is paid within 30 days
period
1) Follow the navigation path
Navigation-Payables Responsibility ->>Setup ->>Invoice ->>Payment terms

3.5 DEFINE INVOICE HOLD AND

RELEASE NAMES
Define hold names that are to be assigned to an invoice during entry to place the invoice on hold. Payment cannot be
applied against an invoice which is on hold, unless either the condition is fulfilled or we manually release the hold.
Navigation-Payables Responsibility ->>Setup ->>Invoice ->>Hold and Release names

3.6 OPEN PAYABLES ACCOUNTING

PERIOD
The period statuses available in Payables are Never Opened, Future, Open, Closed, and Permanently Closed. To
first defined period, Payables assigns a status of Never Opened to the period. Payables does not allow transaction
processing in a period that has never been opened. After changing the status to Future or Open you cannot change it
back to Never Opened.
Navigation-Payables Responsibility ->>Accounting ->>Control Payables Period

3.7 CREATE BANK, BRANCH AND

BANK ACCOUNT
3.7.1 Create Bank
Oracle Payables integrates with Oracle Cash Management to set up internal banks. Oracle Cash Management's
bank account model allows users to define and keep track of all bank accounts in one place and explicitly grant
account access to multiple operating units/functions and users.
Using Oracle Cash Management, define internal banks which are used to disburse payments for Payables
transactions.
1) Follow the navigation path to create the bank by using the web based oracle screen
Navigation-Payables Responsibility ->>Setup ->>Payments ->>Bank and Branches
Create a new bank by clicking on create

2) Enter the values in the mandatory fields

First click "Create" to enter the bank address, then click Apply to save the address

As address is created, now click 'Save and next'

3.7.2 Create Bank Branch

Navigation -Payables Responsibility ->>Setup ->>Payments ->>Bank and Branches

Click the create button in Bank branches tab

Search the Country name and Bank name for which we want to create a Branch.
Enter the country and the bank name for which branch is to be created

Click 'Continue' then enter the required fields such as 'Branch name'.

After entering the required fields click 'Save and Next 'to continue

In the given screen shot click 'Create' to enter the Branch address

Finally on entering the data in required fields click 'Apply'.

Branch address has been created. Address can further be updated

Click 'Create contact' to add personalize details such as Phone number, email-id etc and finally click finish to
complete the branch creation.

3.7.3 Create Bank Account

Navigation -Payables Responsibility ->>Setup ->>Payments ->>Bank Account
Click on 'create' - Enter the country, Bank and Branch name for which Bank Account is to be created

Click on 'Continue' to enter the other mandatory information

Enter the Bank account owner (legal entity) and mention the account use. Here account usage signifies the purpose
of Bank account e.g. as shown below this Bank account will be used by accounts payables as well as receivables.
Click on Next to enter the other account information such as account name, number, currency etc

After entering the account information, Click on 'save and Next' to enter the other account information such as
account control, account holder details, contact details etc.

After entering the account contact information click on Finish to complete the bank account creation.

3.8 CREATION OF SUPPLIER

Set up and maintain suppliers in the Suppliers pages to record information about individuals and companies from
whom goods and services are purchased. You can also enter employees whom you reimburse for expense reports.
When you enter a supplier that does business from multiple locations, you store supplier information only once, and
enter supplier addresses for each location.
1) Follow the navigation path to create the bank by using the web based oracle screen
Navigation -Payables Responsibility ->>Suppliers ->>Entry
To create a new Supplier click 'Create Supplier' and a form gets open.

Click 'supplier type' to choose appropriate type of supplier

2) Enter the required fields such as name of the Organization and the country of Origin, the Click 'Apply'

There are different tabs on the left side of the form. One by one click on the different tabs to enter the mandatory
information and save the changes.
The information for each supplier record is organized into two main sections:

Quick Update page can be used to maintain existing supplier information. It has key set ups for the supplier like
Purchasing and Payment.

3.8.1 Company Profile

1) Organisation - Enter the required fields in the Organisation tab and save the changes.
Mention the high-level company information such a structural, operational, personnel, and financial details about a
supplier. These details are common and apply to the organization whether it is a supplier, a customer or both.

2) Tax Details - Access the Suppliers Tax Details page to enter tax details and specify withholding tax applicability.
The option selected for a supplier default to the new supplier Sites entered, and then default to invoices enter for that
site.
Enter the required information in the Tax Details tab and save the changes

3) Address Book - The Address Book page displays each of the locations that is defined for the supplier. It also
includes a region displaying inactive addresses.It is used to create new addresses and update existing ones. Using
the Hide/Show, can review which operating units use the address by the list of sites that exist for the address. The
system only displays sites that are in MOAC profile.
'Address' tab is used to create the supplier site address. Click on 'Create' and enter country.

Then enter the other required information such as country, address line, town, postal code, address name etc. Also
mention the purpose of this site address. As here the site address is created for payment.

Then select the operating unit to which the new site address is to be assigned and apply it.

4) Contact Directory - This tab is used to enter the details of contact person. Click on create to enter the details

5) Business classification - Here classifications of each supplier is assigned as per their business. Alternatively,
through the iSupplier Portal the supplier can be allowed to access the list and claim the classifications themselves.
After a supplier submits its classification details, the buyer administrator is notified, and the classification status is set
to Pending.

6) Banking Details - Click Create and enter the Banking details in this tab. Suppliers banking information can be
entered and assigned by creating new bank.

This screen is used to create the Supplier Bank. Here we can either enter the existing Bank & branch or can create a
new one. Enter the mandatory fields such as country name, bank name, bank account number etc. Check the Allow
international payments check box to do payments in currency other then the functional currency.

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Create a New Bank. After entering the mandatory fields click Apply to save the information.

Terms and Control

1) Accounting - Accounting page is used to enter the accounting defaults for the supplier and supplier sites. Click on
Create to enter different accounts.
7)

Here different accounts can be defined

2)Tax and Reporting - Tax and Reporting page is used to enter supplier tax information and to provide tax reporting
information.

3)Purchasing - Purchasing Page is used to enter the purchasing defaults for the supplier.

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4) Receiving - Receiving Page is used to enter the receiving defaults for the supplier.

5)Payment Details - Payment Details page is used to enter the Payment defaults for the supplier and supplier sites.

6) Invoice Management - Invoice Management page is used to enter the Payment Terms and other invoice
management controls for the supplier and supplier sites. Invoice payment terms get defaulted from payment terms.

This document covers some of the Basic setups of Accounts payables. There are many other setups like distribution
sets, invoice tolerances, sequencing number etc which are not covered in this document.