R12 ORACLE ACCOUNTS RECEVIABLE PRACTICE GUIDE
R12 ORACLE ACCOUNTS RECEVIABLE FUNDAMENTALS
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R12 ORACLE ACCOUNTS RECEVIABLE PRACTICE GUIDE
TABLE OF CONTENTS
1. Defining Payment Terms:..................................................................................................................32. Creation of Transaction Types:.........................................................................................................43. Creation of Transaction Sources.......................................................................................................54. Creation of Memo Lines:...................................................................................................................65. Creation of Accounting Rules:...........................................................................................................66. Approval limits................................................................................................................................... 67. Define Profile Classes....................................................................................................................... 78. Create a Party (Organization) with party level Account Information & Address.................................9
8.1 Setup Party Profile:................................................................................................................108.2 Setup Communication Details:...............................................................................................108.3 Setup Party Relationships......................................................................................................118.4 Setup Tax Profile:...................................................................................................................11
9. Adding and Updating Account Site Business Purposes:.................................................................129.1 Add Business Purpose...........................................................................................................13
10. Review the setups till now:............................................................................................................1411. Entering and Updating Account Site Payment Details...................................................................16
11.1 Adding and Updating Account Site Profiles.............................................................................1711.2 Adding and Updating Account Site Late Charges....................................................................18
12. Adding more sites to the customer account:.................................................................................1913. Review all customer setups...........................................................................................................2114. Creating a Transaction:................................................................................................................. 23
14.1. Viewing the Balances..........................................................................................................2314.2 Voiding Transactions:...........................................................................................................2414.3 Create Credit Memo:............................................................................................................2414.4. View Account details of the customer:................................................................................2514.5 Dispute details on Invoices:..................................................................................................25
15. Creation of Distribution Sets:.........................................................................................................2616. Receivable Activities:....................................................................................................................2617. Setup Receipt Sources:................................................................................................................. 2718. Setup Receipt Class and Receipt method:....................................................................................2819. Receipt Entry................................................................................................................................. 29
19.1 Receipt Entry - No Remittance :...........................................................................................2919.1 Creating Miscellaneous receipts..........................................................................................3019.2 Writing off............................................................................................................................. 31
20.Printing Documents........................................................................................................................ 3220.1 Printing of Statements..........................................................................................................3220.2 Aging Buckets setup and printing.........................................................................................33
21. Period End Closing:....................................................................................................................... 35A. Revenue Recognition..............................................................................................................35B. Create Accounting:..................................................................................................................36C. Run Unposted Items report:.....................................................................................................38
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1. Defining Payment Terms:
(N) Setup > Transactions > Payment TermsWe need to create payment terms and assign the same while creating the profile class of the
Name XX 2/10-Net30
Description 2 percent discount if paid in 10 days and Net is payable in 30 days
Billing Cycle Base Amount 100Discount Basis Lines OnlyEffective Dates: From 1-Dec-08Installment Options Include tax and freight in first installment
Payment Schedule RegionSequence 1Relative Amount 100Days 30
Button Discounts% 2Days 10
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2. Creation of Transaction Types:
(N) Setup > Transactions > Transaction TypesOperating Unit Legal EntityVision Operations
Name XX Invoice XX CR Memo XX Debit Memo XX Chargeback XX VOIDDescription My Invoice -
XXMy Credit Memo - XX
My Debit Memo - XX
My Chargeback - XX
My Void Invoice - XX
Class Invoice Credit Memo Debit Memo Chargeback InvoiceCreation Sign
Positive Sign Negative Sign Positive Sign Positive Sign Positive Sign
Transaction Status
Open Open Open Open Void
Printing Option
Print Print Print Print Print
Invoice Type Credit Memo Type
XX CR Memo
Application Rule Set
Line First--Tax Prorate
Line First--Tax Prorate
Line First--Tax Prorate
Line First--Tax Prorate
Line First--Tax Prorate
Terms XX 2/10-Net30
Start Date 1-Dec-08 1-Dec-08 1-Dec-08 1-Dec-08 1-Dec-08End Date Open Receivable
Yes Yes Yes Yes
Allow Freight Yes Yes Yes Yes YesPost to GL Yes Yes Yes YesNatural Application Only
Yes Yes Yes Yes Yes
Exclude From Late Charges Calculation
Accounts RegionReceivable Account
01-000-1210-0000-000 01-000-1210-0000-000
01-000-1210-0000-000
01-000-1210-0000-000
01-000-1210-0000-000
Revenue Account
01-000-2925-0000-000 01-000-2925-0000-000
01-000-2925-0000-000
01-000-2925-0000-000
01-000-2925-0000-000
Unbilled Receivable Account
01-000-1232-0000-000 01-000-1232-0000-000
01-000-1232-0000-000
01-000-1232-0000-000
01-000-1232-0000-000
Tax Account
01-000-2520-0000-000 01-000-2520-0000-000
01-000-2520-0000-000
01-000-2520-0000-000
01-000-2520-0000-000
Freight Account
01-000-7220-0000-000 01-000-7220-0000-000
01-000-7220-0000-000
01-000-7220-0000-000
01-000-7220-0000-000
Clearing Account
01-000-1250-0000-000 01-000-1250-0000-000
01-000-1250-0000-000
01-000-1250-0000-000
01-000-1250-0000-000
Unearned 01-000-2550-0000-000 01-000-2550-0000- 01-000-2550-0000- 01-000-2550-0000- 01-000-2550-0000-
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Revenue Account
000 000 000 000
3. Creation of Transaction Sources :
(N) Setup > Transactions > Sources
You can setup 2 types of transaction sources
Manual (If you want to create transactions manually in AR)Imported (if you want to import invoices from Order management, Projects, legacy applications)
Operating Unit Vision OperationsLegal Entity Name XX Invoice SourceType Manual
Batch Source region
DescriptionInvoice Source-Manual-XX Effective Dates (From) 01-Jan-1951
Active Yes Effective Dates (To) Automatic Batch Numbering Last Number 999Automatic Transaction Numbering Yes Last Number 99Copy Document Number to Transaction Number Receipt Handling For Credits Allow Duplicate Transaction Numbers
Reference Field Default Value interface_header_attribute1
Copy Transaction Information Flexfield to Credit Memo Standard Transaction Type XX Invoice Credit Memo Batch Source XX Invoice Source
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4. Creation of Memo Lines:
(N) Setup > Transactions > Memo Lines
Operating Unit Vision OperationsName XX Production SupportDescription Production suport for 1 YearType LineTax Classification Tax Product Category Unit List Price Unit of Measure Revenue Account 01-000-2925-0000-000Invoicing Rule Accounting Rule Active Dates (From) 01-JAN-1951Active Dates (To)
5. Creation of Accounting Rules:
(N) setup > Transaction > Accounting Rules
Name XX 3M Fixed Description XX 3Months FixedType Fixed Schedule Active YesPeriod Month Number of Periods 3 Deferred Revenue No
SchedulePeriod Percent Date [ ]1 33.3333 2 33.3333 3 33.3334
6. Approval limits:
(N) Setup > Transactions > Approval Limits
Main More
Username Document Type Reason Currency From AmountTo Amount Primary Description
XX User Adjustment USD -100 100
XX User Receipt Write-off USD -200 200
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7. Define Profile Classes
(N) Customers>Profile Classes
Enter the Profile name, Description
Enter the following in tab Balance Forward Billing, Invoicing details, Payment terms, Statements and Dunning details of the profile, Collectors, Receipts
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Enter the values for Late Charge Profile
Enter the Profile Class Amounts for which a customer can be assigned
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8. Create a Party (Organization) with party level Account Information & Address
(N) Customers > StandardButton Create
In the Customers window, Create Party with party level Account Information & Address
Customer Information RegionOrganization Name XX My Party3Alias XX MP3
D-U-N-S NumberURL http://www.xxmyparty3.com
Account Information RegionAccount Description XX My Party Accnt3Profile Class DEFAULT
Account TypeExternal
Account Site Address RegionCountry United States of AmericaAddress Line1 102 East Arques AveAddress Line2 33City SUNNYVALECounty Santa Clara
State CA
Postal Code 94085
Address DescriptionGeography Code Override
Optionally enter Account Site Details RegionOperating Unit Vision Operations
StatusActive
Business Purpose RegionPurpose MarketingPrimary Yes
Click on the Button Apply
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The Customer Overview window opens with all the details you entered…
8.1 Setup Party Profile:In the Customer Overview Window, Click on the Profile Tabbed region and enter the below OPTIONAL details
Organization Information Region
Customer Category Education
Tax and Financial Information Region
Taxpayer IDTax Registration NumCurrency Preference USD : US dollarsAnnual Revenue 10000000000
Click on the Button Apply
8.2 Setup Communication Details : In the Customer Overview Window, Click on the Communication Tabbed region and enter the below OPTIONAL details
Phone NumbersSelect Telephone from the drop down and click on button GOCountry Code 1Area Code 471Number 654785Ext 2345Status Active
Click on the Button Apply
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Email AddressesPurpose BusinessFormat HTML mailEmail businessmail@xxmyparty3Status Active
Click on the Button Apply
8.3 Setup Party Relationships: In the Customer Overview Window, Click on the Party Relationships Tabbed region and enter the below OPTIONAL details
Party RelationshipsThis section will display any existing relationships. Click on the button Add Another Row to add a new relationship
Customer Alliance SystemsRelationship Role PartnerStart Date 01-Dec-2007Comments
Click on the Button Apply
8.4 Setup Tax Profile : In the Customer Overview Window, Click on the Tax Profile Tabbed region and enter details for the below. This has to be done with inputs from your tax team and eBTax implementation team.
Main Information Default Controls Tax Registrations Associated Fiscal Classifications Customer Tax Exemptions Tax Reporting Codes Account Tax Details
Customer Tax Exemptions
Exempt reason Hospital EducationRelationship Role Unapproved UnapprovedTax Regime Code US-SALES-TAX-101 US-SALES-TAX-101Configuration Owner Vision Operations Vision OperationsEffective from 01-Dec-2007 01-Dec-2007Discount/Surcharge Percentage
100 100
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9. Adding and Updating Account Site Business Purposes:For the Party you just created. (Optional- As per your requirement)
In the Customer Overview Window, Under the Accounts you will see the entire customer accounts setup till now as in the figure below.
Click on the button Create Account to add a new customer account.
Account Information Region
Account Description XX My Cust Accnt 1Profile Class EXCELLENT
Account TypeExternal
You will see the All Addresses setup earlier in the bottom of the page. You can sel;ect one of them and continue OR Click on the Button Create Address
The customer Account site opens up with the Organization name and Registry ID. Enter the following details …
Account Site Address RegionCountry United States of AmericaAddress Line1 404 East Arques AveAddress Line2 404City SUNNYVALECounty Santa Clara
State CA
Postal Code 94085
Address Description My Cust Accnt 1Geography Code Override
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Optionally enter Account Site Details RegionOperating Unit Vision Operations
9.1 Add Business Purpose
Business Purpose RegionPurpose Bill ToPrimary YesBill To LocationClick button Add Another RowPurpose Ship ToPrimary YesBill To Location (Site Bill-to)
Click on the Button Finish
The Customer account details are saved and the Site:30997 (number of your site) is displayed as in the figure below. Enter details in other tabs highlighted below
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Enter/Review details in this tab
R12 ORACLE ACCOUNTS RECEVIABLE PRACTICE GUIDE
10. Review the setups till now:The next section enclosed in **stars** is only for your information. Review the info and proceed to setting up Payment details + Profile + Late charges tabs*************************************************************************************************************If you go back to the Customer overview window now you can observe how your Party > Cust Accnt > Cust Accnt Site are structured as in the fig below
Your Party+ Customer Account + Its site + Business Purpose at that site
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*****************************************************************************************************************
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11. Entering and Updating Account Site Payment Details .
Open the site to which you want to add payment details: From the Customer Overview window, select the your Customer Account and select the Site within that customer account and click on the icon
under details... . This will open the Site:30997 (number of your site) window.
Receipt Method: If you intend to use automatic receipts for this site. We shall leave this blank
Receipt Methods
Primary
Start Date
End Date
Bank Accounts: You can assign a bank account either by adding a predefined bank account or by creating a new bank account
Country United States of America
Allow International PaymentsBank Accounts Region
Select Existing Bank YesBank Name Citibank
Branch RegionBranch Name Westside Branch
Bank AccountAccount Number XX1000
Check Digits 6
Currency USD
Click on the Button Apply
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11.1 Adding and Updating Account Site ProfilesUse the Profile subtab of the Account Site Overview page to add and update the profiles of existing account sites.
Navigate to the Profile subtab on the Account Site Overview page. (For newly created account sites only) Select Yes in response to the Assign Profile Class
confirmation message, in case you decide to create a profile at the account site level.
By default, the account site inherits the profile class assigned at the account level. However, you can change the account site profile class as required.
Accept the default values for the below or select different values as may be required… Profile Class Credit and Collection Terms Receipts Statements and Dunning Invoicing
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Click on the Button Apply
11.2 Adding and Updating Account Site Late Charges You can assess late charges against past due debit items for each customer, account, or siteAccept the default values for the below or select different values as may be required…
Click on the Button Apply
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12. Adding more sites to the customer account : ( For eg to the cust account XX My Cust Accnt 1)
From Customer Overview window, select the customer account to which you want to add an additional Site as shown in the figure below…
Click on button Create Site. This will open Create Account Site window as in the figure below
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Address RegionOperating Unit Vision Operations
Click on the button Create Address Enter the following details in the …
Account Site Address RegionCountry United States of AmericaAddress Line1 504 East Arques AveAddress Line2 504City SUNNYVALECounty Santa Clara
State CA
Postal Code 94085
Address Description My Cust Accnt 1
Business Purpose RegionPurpose Bill ToPrimary YesBill To LocationClick button Add Another RowPurpose Ship ToPrimaryBill To Location (Site Bill-to)Click button Add Another Row
Purpose Legal
Primary Yes
Click on the Button Finish
This will open the Site:31017 (number of your site) window with the Site Details
Optionally you can review each of the tabs in the above window and update them.
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13. Review all customer setupsFrom the Customer Overview window, your customer structure will look like the below
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13. Party Merge
Party merge is managed by Trading Community Architecture
(N) Customers>Party Merge
14. Customer Account Merge
This is used to consolidate any duplicate customers or transfer site use activity from a customer or site that is no longer active. After the merge completes successfully, all activity that was previously associated with the old customer or site is now associated with the new customer or site. Activity includes invoices, debit memos, commitments, credits, receipts, adjustments, and chargeback’s. The merge process also checks for records in the Auto Invoice interface tables.
If we need to delete the records after Customer Merge we need to enable the check box Delete After Merge then all the invoices which has been merged would be deleted from the system and we would be available only with the merged invoices
(N) Customers > Account Merge
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After providing the required information we need to click on Merge button so that the Account Merge would be started by raising an Concurrent Request which is displayed on Request ID button.
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14. Creating a Transaction:
(N) Transactions > Transactions
HeaderSource XX Invoice Source Date Accept defaultNumber GL Date Accept defaultClass Currency USDType Accept default Main TabBill to SectionName Alliance SystemsNumber 1990Payment Term XX 2/10-Net30Invoicing RuleClick on Lines Button
Lines Main Tab Tax Exemption TabNum 1 Tax Handling ExemptItem AS18947 Reason EducationDescription Accept default UOM Accept default Quantity 10 Unit Price 1000 Amount Accept default Save and Close the Lines windowClick on the button Complete
Note down the Transaction Number: It should be 1000
14.1. Viewing the Balances
Click on the button Details
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14.2 Voiding Transactions:Query the transaction to be voided (should not have been transferred to GL and no other activities performed on this invoice)Click on the button Incomplete Change the Type as XX VOID then click on Complete button. The transaction is voided.
14.3 Create Credit Memo: (from transactions window)
Create an Invoice (Refer Creating Transaction chapter)
From Menu click on Actions > Credit .On the Credit transactions window, Navigate to Transaction Amounts region: Select Lines only in credit allocation field.
Enter a percentage by which you want to reduce the transaction amount. Or Simply enter a negative amount and save.
The Credit memo number is generated and Balance Due on original invoice is reduced. Finally click on the button Complete.
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14.4. View Account details of the customer:
(N) Transaction > Account details
Bill To Customer Alliance SystemsNumber 1990
Click on Button FindObserve the details as in Screen shot below
14.5 Dispute details on Invoices:
If there is any invoice which is in dispute we can update in the dispute column by giving the dispute date and then when the dispute is resolved then we can remove the dispute amount and dispute date accordingly. (N) Transaction > Account details
View account details, Select the invoice you want to put some amount on dispute, Enter an amount
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15. Creation of Distribution Sets:
(N) Receivables>Setup>Receipts>Distribution Sets
<Distribution Sets>Operating Unit Vision OperationsName XX Miscellaneous
Description
Distribution sets let you speed your receivables accounting by reducing data entry
Active Yes
<Distribution Set Lines> % Account Description
60 01-740-7740-0000-000 To Controllers office
40 01-001-7740-0000-000 To IT dept
16. Receivable Activities:
(N) Setup > Receipts > Receivable Activity
Operating Unit Name Description TypeActive
GL Account Source
Tax Rate Code Source
Activity GL Account
Distribution Set
Vision Operations
XX BANK CHARGE ADJ
XX BANK CHARGE ADJ Adjustment *
Activity GL Account None
01-740-7870-0000-000
Vision Operations
XX Earned Discount
XX Earned Discount
Earned Discount *
Activity GL Account None
01-410-7825-000
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Vision Operations
XX SELL TREASURY STOCK
XX SELL TREASURY STOCK
Miscellaneous Cash *
Activity GL Account None
01-000-1110-0000-000
Vision Operations
XX Receipt Write-off
XX Receipt Write-off
Receipt Write-off *
Activity GL Account None
01-000-7730-0000-000
17. Setup Receipt Sources:
(N) Setup > Receipts > Receipt Sources
Operating Unit Vision Operations Name XX MANUAL Description XX Manual Receipts SourceReceipt Source Type Manual Payment Method Receipt Class Direct Receipt Bank Account Batch Numbering Automatic Last Number 99Effective Dates(From) 01-JAN-1951
Effective Dates(To)
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18. Setup Receipt Class and Receipt method:
Receipt Class Name XX RC-Man-NR-Direct XX RC-Man-Std-AutoClrCreation Method Manual ManualNotes Receivable Require Confirmation Remittance Method No remittance StandardClearance Method Directly By Auomatic Clearing
Receipt Method Name XX Rec Meth XX Rec Meth-MSBPrinted Name XX Rec Meth Effective Dates (From) 01-JAN-1951 1-Jan-51Effective Dates (To) Notes Receivable N NDebit Memos Inherit Receipt Numbers
<Remittance Banks> Operating Unit Vision Operations Vision OperationsBank Name Citibank CitibankBranch Name West Side Branch West Side BranchAccount Name Citibank Westside-204 Citibank Westside-204Currency USD USDMinimum Receipt Amount Risk Elimination Days Clearing Days Override Bank Effective Dates (From) 1-Jan-51 1-Jan-51Effective Dates (To) Primary Yes Yes
GL Accounts Cash 01-000-1110-0000-000 01-000-1110-0000-000
Receipt Confirmation 01-000-1210-0000-000Remittance 01-000-1245-0000-000Factoring Short-term Debt Bank Charges 01-740-7870-0000-000Unapplied Receipts 01-000-1240-0000-000 01-000-1240-0000-000Unidentified Receipts 01-000-1240-0000-000 01-000-1240-0000-000On Account Receipts 01-000-1240-0000-000 01-000-1240-0000-000Unearned Discounts Unearned Discount Unearned DiscountsEarned Discounts Earned Discount Earned DiscountsClaim Investigation Claim Investigation Claim Investigation
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19. Receipt Entry
19.1 Receipt Entry - No Remittance :
Create a transaction and complete the transaction. Refer to the chapter Creating a Transaction
Create a Receipt for the transaction
(N) Receipts > Receipts
If we create receipt with the amount specified and before application of the receipt the balance would be transferred to Unidentified receipts as shown below
Receipt Method Your Receipt methodReceipt Number Enter a receipt number
Receipt Amount in USD500
Receipt Type StandardTransaction NumberCustomer Alliance Systems
Number 1990
Click on Button ApplyApply to 1000
Applied Amount 500
Save your work
After the application of receipt to a transaction the amount would be moved to applied status. View balance on the transaction:
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19.1 Creating Miscellaneous receipts
Non invoice related revenue earned from investments, interest, refunds, stock sales etc can be accounted by using Miscellaneous receipts
Receipt Method XX Rec MethReceipt Number Enter a receipt number
Receipt Amount in USD100
Receipt Type MiscellaneousActivity XX Miscellaneous Cash
Save your work
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19.2 Writing off
Create a transaction and complete (N) Transactions > Transactions
From Menu Actions> Adjust
In the adjustments window, select Activity name (this is a receivable activity that you have setup earlier with a GL account attached to it. Enter type as Line, enter amount (negative if you want to reduce the balance)
View the transaction after adjustment
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20.Printing Documents:
20.1 Printing of Statements
Enter the Option, Customer name, Statement Cycle, Bucket, and Statement Date and choose the standard messages you want to print in the bottom of the report and click Submit.
Review the output of the request, Print it and send the statement to your customer
We can add special message to print when the Statement has been printed and sent to customer
(N) Print Documents> Statements
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20.2 Aging Buckets setup and printing
Run the concurrent request from Menu View> Requests
The output would appear as follows:
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21. Period End Closing:
• At the end of each accounting period, you must complete the month-end closing process. The first step towards period closure is to run the Run the revenue recognition program.
• Run the Create accounting program in final mode with Post journals to GL as Yes. Make sure the journals are created and posted
A. Revenue Recognition
• The Revenue Recognition program identifies all new transactions and creates the revenue distributions for those transactions. The distributions are created for all periods, even in periods whose status is Not Open, using the rules associated with the transactions
(N) Control > Accounting > Revenue Recognition
Program Name Revenue RecognitionOperating Unit Vision Operations
ParametersPrint Format: SummaryCommit Work: Yes
Submit the reqquest
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B. Create Accounting:
There are two ways to create Accounting:
Online Accounting for a single transaction and Create accounting off line (concurrent request) for all transactions at a time.
B1. Online Accounting: Query the Transaction which needs to be accounted
(N) Transactions > Transactions
From Menu Tools > Create Accounting
We need to provide the required option such as Draft, Final Accounting or Accounting and Post to GL
After the Accounting option is provided view the Accounting entries
From Menu Tools> View Accounting
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B2. Create accounting off line (Nightly job): From the Submit Requests window, run the create Accounting program in either draft mode, if you want to review the results before you create the final accounting, or final mode.
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C. Run Unposted Items report:
Run the unposted items concurrent request which would effect the period close. There should be no items in this report so that we can close the period and open the next period.
From Menu > view> Concurrent request
Submit Unposted Items report and provide the following details:
Ledger Currency: USD
Start GL Date: 01-DEC-2008
End GL Date: 31-DEC-2008
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