Procure to Pay Cycle

Diagrammatic representation of Procure to Pay cycle.

Procure to Pay cycle

 

Watch the procure-pay-cycle-video 

Article with 11i screen shots: Procure to Pay Cycle 11i

Query: Procure to Pay Cycle Query

1) Create 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.

Navigation: Purchasing Vision Operations (USA) > Requisitions > Requisitions

Choose the requisition type and enter the Item, quantity, Price details in the Lines tab.

In Source Details tab, specify the Buyer name.

Click the Distributions button. Enter the Charge Account.

Save the work. The status of the requisition will now be “Incomplete”. And now the Approve button is highlighted. The requisition needs to be approved first before proceeding further by the concerned authority. Submit this requisition for Approval by clicking on the Approve button. The status will now be updated to “In Process” .The workflow then will send an Approval notification to the concerned person (derived based on hierarchy used—Position or Supervisor hierarchy) using which he can Approve or Reject the requisition.

At any time the status of requisition can be checked using the Requisition summary window.

Navigation: Requisitions > Requisition Summary

Enter requisition number and click on the find button.

We can also check the Action History of requisition (it will show details about who has submitted, approved and cancelled the requisitions) as below:

Navigation: Tools menu > Action History.

Underlying Tables:

PO_REQUISITION_HEADERS_ALL

PO_REQUISITION_LINES_ALL

PO_REQ_DISTRIBUTIONS_ALL

2) Create Purchase Order:

There are 4 types of Purchase Orders:

1. Standard PO: A Standard PO is created for one–time purchase of various items

2. 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.

3. 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.

4. 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

Navigation for creating a standard PO: Purchase Orders > Purchase Orders

Choose type as Standard Purchase Order. Enter the Supplier, Buyer. In the Lines tab, specify the line number, line type, Item, quantity, price etc.

Click Terms to enter terms, conditions, and control information for purchase orders.

Click Currency button to enter and change currency information for purchase orders, RFQs, and quotations.

Click Shipments button to enter multiple shipments for standard and planned purchase order lines Purchase order shipment specifies the quantity, ship–to organization and location, date you want your supplier to deliver the items on a purchase order line, and country of origin for the items. When you save, Purchasing creates distributions depending on the default information available.

To enter more shipment information, select the More tab.

  • Enter the Receipt Close Tolerance percent, Invoice Close Tolerance percent to set the receiving and invoice close point.
  • Select one of the following options for 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.

  • Select an Invoice Match Option:

Purchase Order: Payables must match the invoice to the purchase order.

Receipt: Payables must match the invoice to the receipt.

Save the work.

Click the Receiving Controls button to enter receiving control information for purchase orders.

- Enter the maximum acceptable number of Days Early and Days Late for receipts.

- Enter the Action for receipt date control.

- Enter the maximum acceptable over–receipt Tolerance percent (receipts that exceed the quantity received tolerance).

- Enter the Action for Overreceipt Quantity.

- Select Allow Substitute Receipts to indicate that receivers can receive substitute items in place of ordered items.

- Enter the default Receipt Routing that you assign goods: Direct Delivery, Inspection Required, or Standard Receipt.

- Enter the Enforce Ship To location option to determine whether the receiving location must be the same as the ship–to location.

Save the work.

Click Distributions button to enter distributions for the shipments.

Select more tab to enter more details and the requisition number (optional).

Save the work.

Click on the Approve button to initiate the Approval process.

Underlying Tables:

PO_HEADERS_ALL

PO_LINES_ALL

PO_DISTRIBUTIONS_ALL (REQ_HEADER_REFERENCE_NUM in Distributions table is the Requisition number for this PO)

3)Create Receipt:

Create a receipt to receive the items in the Purchase Order.

Navigation: ReceivingàReceipts

Enter the PO Number and select find button.

Go to Lines, check the lines you want to receive in the PO.

Click on Header button and Save which creates the receipt.

Receipt Tables are:

RCV_SHIPMENT_HEADERS

RCV_SHIPMENT_LINES (Lines Table has PO_HEADER_ID)

4) Create Invoice in Payables:

Once the goods are received, it’s time to pay the vendor for the goods purchased and hence the invoices are created.

Navigation: Payables, Vision Operations (USA) > InvoicesàEntryàInvoices

Enter type — Standard, supplier information and amount.

Click the Match button to match to either Purchase Order or Receipt (depending on the Invoice Match option specified on the PO) and avoid manually entering the invoice.

Enter the PO Number you want match to and click Find.

Select the lines required and click on Match button.

Click on Distribute button
to navigate to the Match to Purchase Order Distributions window.

This creates the invoice and you can see the status of the invoice as “Never Validated”. it has to be Validated and Accounted before you can pay it.

Validating the Invoice:

Click on Actions Button and Select “Validate”. Click on OK button.

Now you can see the status of the invoice as “Validated”, if there are no issues during validation.

Create Accounting Entries:

Click on Actions Button and Select “Create Accouting”. Click on OK button.

Now we can see the Accounted status as “Yes”.

You can see the Accounting Entries here:

Tools àView Accounting

Invoice Tables:

AP_INVOICES_ALL

AP_INVOICE_DISTRIBUTIONS_ALL

Accounting Entries Tables:

AP_ACCOUNTING_EVENTS_ALL

AP_AE_HEADERS_ALL

AP_AE_LINES_ALL

5)Making a Payment:

Go to the Invoice window and query the invoice you want to pay. You would see Amount paid as 0.00 before you make a payment.

Click Actions button. Select “Pay in full” and click “OK”.

Select the Bank Account and Document. Save the Work.

Now that the payment is made, when you query for the invoice in Invoice window, you will the Amount Paid as $4,000.00.

Create Accounting entries for payment.

Click Actions and select “Create Accounting”

Select the void checkbox to cancel the payment.

View Accounting Entries:

In the Payments window, query for the payment.

Tools menuàView Accounting

Payment Tables:

AP_INVOICE_PAYMENTS_ALL

AP_PAYMENT_SCHEDULES_ALL

AP_CHECKS_ALL

AP_CHECK_FORMATS

AP_BANK_ACCOUNTS_ALL

AP_BANK_BRANCHES

AP_TERMS

You can also pay the invoices using Payment Batch screen. Refer to the article “Make AP Payments through Payment Batches”

6) Transfer to General Ledger:

Navigation: Payables Responsibility > View Requests

Run the concurrent program “Payables Transfer to General Ledger” with the required parameters.

Journal Import & Post:

Refer to the Article “Order to Cash Cycle“.

114 Comments

  1. arch
    May 21, 2011 @ 04:32:52

    good dosument i have ever seen

    Reply

  2. Swapnil
    May 26, 2011 @ 21:55:35

    Good for the Beginner..

    Thank you.

    Reply

  3. madhan
    Jun 01, 2011 @ 10:25:56

    very nice

    Reply

  4. haritha
    Jun 01, 2011 @ 12:34:27

    These documents are very helpful to understand the process of procure to pay.

    Reply

  5. santu
    Jun 14, 2011 @ 09:24:51

    fantastic documentation…
    thanks a ton

    Reply

  6. Suryabhan
    Jun 22, 2011 @ 14:21:07

    BETTER THAN THE BEST DOCUMENTATION

    Thanks a lot,

    Reply

  7. C
    Jun 24, 2011 @ 01:06:33

    What about transaction taxes like sales/use tax or VAT?

    Reply

  8. suresh
    Jun 29, 2011 @ 18:05:32

    The Documents i have Ever seen for the P2P Cycle
    thanks for ur valiable guide lines

    Reply

  9. sandeep nalam
    Jul 17, 2011 @ 06:53:47

    very good,this is lot of use how to say interviews and get more knowledge…………….

    Reply

  10. Basha
    Jul 19, 2011 @ 10:35:15

    Nice document to create the p2p

    Reply

    • krishna
      Feb 07, 2012 @ 11:43:19

      It’s very good Document

      Reply

  11. Hari Prasad
    Aug 10, 2011 @ 11:34:03

    A good presentation and easy to understand.
    Could be more specific with relations between Requisition,Purchase Order,……tables?

    Reply

  12. Sridhar
    Aug 11, 2011 @ 12:49:13

    Excellent doc

    Reply

  13. prasanth
    Aug 16, 2011 @ 13:09:38

    A good presentation and easy to understand. and i want one thing in R12 how to transfer the payable to the general ledger. thanks in advance

    Reply

  14. raj
    Aug 19, 2011 @ 21:03:33

    Excellent doc

    Reply

  15. Vijay
    Aug 26, 2011 @ 15:36:37

    Thanks a Lot…It was very helpful….

    Reply

  16. RAJA
    Aug 29, 2011 @ 18:17:40

    I CAN UNDERSTAND VERY EASY. IT’S A GOOD DOCUMENT.

    Reply

  17. manoj kumar
    Aug 31, 2011 @ 12:41:47

    very nice

    Reply

  18. Suryabhan Chitte
    Sep 06, 2011 @ 10:42:51

    Better than the BEST

    Reply

  19. Gopal
    Sep 07, 2011 @ 12:45:09

    Excellent document. It was very easy to understand. Keep up the good work!!!

    Reply

  20. priyanka
    Sep 07, 2011 @ 15:41:14

    very beautiful document

    Reply

  21. kumar
    Sep 14, 2011 @ 18:12:20

    this artical is really help full to freshers

    Reply

  22. Ram_POsam
    Sep 16, 2011 @ 10:04:23

    It’s simply superb i ever seen these types of posting.
    These are very useful for beginners and as well as experienced.

    Reply

  23. Puññareddy
    Sep 26, 2011 @ 18:53:37

    Nice Document and can u prepare in R12

    Reply

  24. Brahma Reddy
    Sep 29, 2011 @ 15:18:31

    Superb document, i have ever seen earlier. Thanks for the helpful document.

    Reply

  25. kumar choudary
    Sep 30, 2011 @ 19:21:33

    its…….really a good……no more talking…

    Reply

  26. venkimba24
    Oct 18, 2011 @ 15:56:27

    its very nice sir keep posting new things

    Reply

  27. Riaz
    Oct 18, 2011 @ 18:30:38

    Great Article on this Topic!!! Thanks

    Reply

  28. Glovam
    Nov 07, 2011 @ 21:09:38

    Gr9 Work, Nice Document.. is it the same with R12 ledger name instead of Sets of Books. or are any changes in the P2P Process. Please do share your thoughts ,

    Thanks of +++ to share this Useful document.. :)

    Reply

  29. bipin
    Nov 10, 2011 @ 18:05:18

    very good document. very helpful to me

    Reply

  30. ANAS
    Nov 12, 2011 @ 20:27:14

    Absolutely Brilliant

    Reply

  31. teeka ram
    Nov 14, 2011 @ 11:37:17

    it is a great way to help student to understand order processing. Thank you sir good bless you..

    Reply

  32. Ashok
    Nov 16, 2011 @ 01:11:17

    It is very use full doc.., i have ever seen

    Reply

  33. lakshman
    Nov 20, 2011 @ 13:22:22

    it is very nice&easly understand
    but i want to some more clarification on the invoice tables
    in that tables having which information is stored(AP_ACCOUNTING_EVENTS_ALL,
    AP_AE_HEADERS_ALL,
    AP_AE_LINES_ALL, etc)
    and pls entered gl tables

    Reply

  34. javed khan
    Nov 22, 2011 @ 17:22:14

    best document

    Reply

  35. Kishore
    Nov 24, 2011 @ 19:43:47

    Really very very nice.Really hands up to u Mr.boss why i am saying that Share of knowledge is Really Great thought.it is sooooooo helpful to every body and especially to me.thanks a lot…..

    Reply

  36. Rajmohan B
    Nov 29, 2011 @ 09:19:07

    Thank you very much. It was very helpful. I request you to update the same process for item creation, subinventory, oganization assignment etc. Hoping for your good work.

    Reply

  37. Jignesh
    Nov 29, 2011 @ 14:28:14

    Dear Sir,
    We follow procedure for payment: 1) GOOD – 4 WAY & 2) Service – 2 WAY match in PO.
    How to set the setup in ERP 12i.
    Pls help.

    Regards,Jignesh

    Reply

  38. Arun Kumar
    Dec 06, 2011 @ 18:25:29

    thank you very much for helping us to easily understand the P2P process by this document.
    your help is much appreciated.

    Reply

  39. singhs9
    Dec 08, 2011 @ 14:47:41

    Great work…..superb document to learn basics of P2P cycle….

    Reply

  40. gurram
    Dec 20, 2011 @ 11:22:40

    hi

    Reply

  41. Ranjeeta
    Dec 30, 2011 @ 20:44:42

    It is a nice doc very easy to understand and more useful for the beginners.

    Reply

  42. srini
    Jan 03, 2012 @ 23:17:46

    excellent document

    Reply

  43. Jignesh
    Jan 19, 2012 @ 16:13:29

    We have deleted incomplete POs in ERP 12i.
    We require details, how many POs are deleted in system

    Reply

  44. Anand
    Jan 21, 2012 @ 04:21:05

    Easy n simply explained.. thnx !

    Reply

  45. puja
    Feb 02, 2012 @ 12:58:57

    Dear sir,

    The article is very good,but actually am stuck at one point. at stage of creating invoice,after matching with po when i click on validate it shows me need revalidation , tell me what can be the issue?

    Reply

  46. anil
    Feb 04, 2012 @ 12:13:47

    Superb document, i have ever seen earlier. Thanks for the helpful document.

    Reply

  47. vjrs
    Feb 05, 2012 @ 23:23:34

    Really very good and easy understanding bro

    Reply

  48. Surender Singh Nagar
    Feb 07, 2012 @ 13:13:32

    It’s very helpful for all freshers in P2P Accounts Payable. A great help to understand P2P process of Accounts payable.

    Reply

    • Surender Singh Nagar
      Feb 07, 2012 @ 13:14:36

      i am agree with these comments.

      Reply

  49. UTTAM
    Feb 22, 2012 @ 19:38:19

    GOOD INFORMATION, REALY VERY GOOD…..

    Reply

  50. prajith
    Feb 23, 2012 @ 22:47:41

    very easy to understand thanku….

    Reply

  51. navin
    Feb 29, 2012 @ 12:23:37

    good and understandable

    Reply

  52. abdul gaffar
    Mar 21, 2012 @ 19:20:29

    very helpful document

    Reply

  53. prasanth
    Mar 30, 2012 @ 14:33:48

    it is very helpful to the beginer,everybody can understand easily
    thank you ..

    Reply

  54. vaseem
    Apr 02, 2012 @ 16:39:36

    thanks for providing informations it very good document .

    Reply

  55. KishoreV
    Apr 13, 2012 @ 12:14:01

    Excellent Document on P2P cycle

    Reply

  56. chita ranjan shadangi
    May 08, 2012 @ 14:40:44

    i appriciate this document

    Reply

  57. prashanth
    May 09, 2012 @ 17:08:05

    nice document………..

    Reply

  58. Dineesh
    May 22, 2012 @ 12:55:06

    EXCELLENT

    Reply

  59. Manav Kesar
    Jun 10, 2012 @ 22:22:19

    Very good Article.Thanks A lot
    Keep up the good work
    Manav

    Reply

  60. Mini
    Jun 12, 2012 @ 04:08:23

    Hi, we have a situation where the Charge Account data on some of the lines on a Purchase Order just disappear. (r12)
    Would you be able to provide some information on this.

    Reply

    • Shubham
      Jul 06, 2012 @ 12:19:58

      USE THIS TABLE TO GET THAT INFO : gl_code_combinations_kfv

      Reply

    • Navin
      Jul 06, 2012 @ 12:20:26

      we get separated Charge Account data in gl_code_combinations table…..but we get concatinated Charge Account data in gl_code_combination_klv table….

      Reply

      • Shubham
        Jul 06, 2012 @ 12:23:11

        Navin , Its gl_code_combination_klv or gl_code_combinations_kfv …?

        Reply

        • Navin
          Jul 06, 2012 @ 12:24:44

          ohh shubham bro….its gl_code_combinations_kfv…. thanks for correction

          Reply

  61. madhu
    Jun 26, 2012 @ 21:49:31

    it is helpful

    Reply

  62. Shubham
    Jul 06, 2012 @ 12:16:47

    Its really helpful for Beginners….. Thanks Prudhvi

    Reply

  63. Tarun Saxena
    Jul 10, 2012 @ 10:32:53

    Nice presentation ……..

    Reply

  64. saran
    Jul 18, 2012 @ 19:53:54

    awesome and the best document.

    Reply

  65. uday
    Jul 20, 2012 @ 11:47:49

    Excellent tutorial for beginers & apps user

    Reply

  66. raj
    Jul 26, 2012 @ 14:15:28

    A very nice explanation and precise explanation. Thank you.

    Reply

  67. lrojas
    Jul 27, 2012 @ 05:16:03

    Hi,

    Excelent document !!!!!

    Thanks

    Reply

  68. ram
    Jul 30, 2012 @ 00:23:14

    Very helpful for beginners..thanks a lott

    Reply

  69. Rahul
    Oct 05, 2012 @ 01:50:08

    hi,

    I am really happy after reading these whole P2P Cycle.
    I want to learn more and more regarding the P2P,so please sent me a some more things like PPT.

    Reply

  70. Rahul
    Oct 05, 2012 @ 02:13:35

    hi.

    i need more things regarding P2P.

    Reply

  71. kk
    Nov 27, 2012 @ 17:44:26

    please update all the technical flow of p2p,o2c with r12 tables and also mention the standard concurrent programs that run at back end.. I feel it would be helpful….thanks a million… i would thankful if u mention all the details…

    Reply

  72. Renuka
    Jan 24, 2013 @ 13:21:29

    A very useful guide…

    Reply

  73. Chiranjeev Pandey
    Jan 29, 2013 @ 06:45:37

    Thanks for this nice and precise article

    Reply

  74. GOWTHAM
    Jan 29, 2013 @ 18:19:31

    VERY NICE DOCUMENT…VERY EASY 2 UNDERSTAND PROCESS CLEARLY.

    Reply

  75. Bharathi R
    Feb 21, 2013 @ 15:02:58

    Thnks for ur valuble gride lines……….

    Reply

  76. shrirama
    Apr 02, 2013 @ 20:04:20

    Excellent

    Reply

  77. Shaikshavali
    Apr 04, 2013 @ 10:51:02

    Hi,

    Thanks for sharing the information….

    Really helpful for Oracle Apps beginners….

    -Thanks
    Shaikshavali

    Reply

  78. madan mohan
    Apr 15, 2013 @ 20:25:45

    THANK U

    Reply

  79. Mahesh
    Apr 17, 2013 @ 03:14:46

    Excellent presentation with screen shot

    Reply

  80. Shirley
    Apr 24, 2013 @ 19:22:25

    nice document!!Thanks!

    Reply

  81. Shirley
    Apr 24, 2013 @ 19:27:05

    I am a fresher of Oracle, this document is helpful for me. Thanks a lot!

    Reply

  82. Beginner
    Apr 30, 2013 @ 19:56:33

    Awesome :-)

    Reply

  83. gulzar wipro
    May 01, 2013 @ 21:50:13

    it being a great source or informative for freshers as well as for experienced one to crack the interview.

    Reply

  84. rama
    May 03, 2013 @ 15:38:45

    very nice

    Reply

  85. Muralikrishna
    Jun 11, 2013 @ 08:36:02

    Thanks for giveing nice information about the P2P.

    Reply

  86. Priyanka
    Jun 17, 2013 @ 09:44:30

    General overview of the document. Nice.

    Reply

  87. Waris Gulzar
    Jun 20, 2013 @ 12:00:46

    that's very good
    documents are very helpful to understand the process of p2p., both functionally and Technically

    Reply

  88. MM
    Jun 28, 2013 @ 21:39:26

    Thank you SO MUCH :)

    Reply

  89. Vivek
    Jul 03, 2013 @ 13:00:54

    Very nice post. Thanks a lot for the elaborate explanation. It is indeed of great help to freshers. Keep Continuing the good work.

    Reply

  90. Shankar
    Jul 29, 2013 @ 21:07:33

    Really Good work.. It is very useful..

    Reply

  91. venkatesh
    Aug 01, 2013 @ 01:07:24

    good work but also give forms user manual

    Reply

  92. ashwin
    Aug 22, 2013 @ 15:11:15

    hi good work easy to understand thank u

    Reply

  93. Leandro
    Aug 22, 2013 @ 19:04:25

    Awesome job. Congratulations!!!

    Reply

  94. prabhjot singh
    Aug 23, 2013 @ 16:38:23

    great job. its very easy to understand.
    Thanks alot.

    Reply

  95. naresh
    Aug 28, 2013 @ 16:15:14

    Hey, extraordinary work.

    Reply

  96. ahmad
    Sep 02, 2013 @ 10:16:06

    hi
    sir
    plz send me P2P and O2C end to end cycle with explanations.it is very useful to me.

    regrad
    ahmad

    Reply

  97. subhani
    Sep 21, 2013 @ 13:28:24

    hi
    sir
    1.can we create contract purchase order across operating units?if yes?how.plz send me answer.
    2.how to create raw material item?what are the attributes enabled?

    Reply

  98. hardik shah
    Sep 27, 2013 @ 18:20:58

    excellent document.very easy to understand

    Reply

  99. Krishna Ch Mishra
    Oct 03, 2013 @ 14:22:29

    Excellent supportive document for P2P

    Reply

  100. Md Ashraful Islam
    Oct 30, 2013 @ 12:17:56

    Very nice website. thanks for help us by the website

    Reply

  101. Yogesh
    Apr 08, 2014 @ 20:32:16

    Really Amazing..the way of Presentation..the way it seems..very nice…

    Reply

  102. Bidyakar
    Apr 14, 2014 @ 19:02:05

    Hi All,

    Kindly help me for Project Accounting data flow in Oracle apps.

    Regards,
    Bidyakar

    Reply

  103. Bidyakar
    Apr 14, 2014 @ 19:03:20

    Hi All,

    Kindly help me for project accounting in Oracle apps.

    Regards,
    Bidyakar

    Reply

  104. Mohd Aleem Uddin
    Jun 17, 2014 @ 10:43:20

    its very awesome These documents are very helpful to understand the process of procure to pay

    Reply

  105. ijbabu
    Jun 17, 2014 @ 23:16:04

    It is very useful.

    Reply

  106. ashok
    Jun 28, 2014 @ 20:57:34

    Thanks very much,
    its very useful for me

    Reply

  107. Balu
    Jun 30, 2014 @ 17:31:50

    Its very good to understand the terminology.

    Reply

  108. Ram
    Jul 19, 2014 @ 18:57:39

    very nice presentation.

    Reply

Leave a Reply