D49874GC20 sg2

Volume II - Student Guide
D49874GC20
Edition 2.0
February 2009
D58418
Copyright 2009, Oracle. All rights reserved.
R12 Oracle Purchasing Fundamentals Table of Contents
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R12 Oracle Purchasing

Fundamentals

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Authors
Vic Mitchell, Dee Fairbanks Simpson
Technical Contributors and Reviewers
Marilyn Montgomery, Barbara Nicholls, Barbara Snyder, Sharon Tennier, Vera Reyna
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Procure to Pay Lifecycle Overview ................................................................................................................1-1

Procure to Pay Lifecycle Overview ...............................................................................................................1-2
Objectives ......................................................................................................................................................1-3
Procure to Pay Lifecycle................................................................................................................................1-4
Oracle Procure to Pay Process.......................................................................................................................1-6
Demand: Requisitions....................................................................................................................................1-8
Source: RFQs and Quotations .......................................................................................................................1-10
Suppliers ........................................................................................................................................................1-12
Purchase Orders.............................................................................................................................................1-14
Receiving.......................................................................................................................................................1-16
Invoicing........................................................................................................................................................1-18
Payment .........................................................................................................................................................1-19
Overview of Oracle Application Integration .................................................................................................1-20
Summary........................................................................................................................................................1-22
Oracle Purchasing Overview ..........................................................................................................................2-1
Oracle Purchasing Overview .........................................................................................................................2-2
Procure to Pay: Procurement .........................................................................................................................2-3
Objectives ......................................................................................................................................................2-4
Agenda...........................................................................................................................................................2-5
Overview of the Ordering Process.................................................................................................................2-6
Demand as Requisitions ................................................................................................................................2-7
Requisition to Purchase Order .......................................................................................................................2-9
The Purchase Order Process ..........................................................................................................................2-10
The Receiving Process...................................................................................................................................2-12
Center-Led Procurement................................................................................................................................2-15
Agenda...........................................................................................................................................................2-16
Purchasing Integration...................................................................................................................................2-17
E-Business Foundation ..................................................................................................................................2-18
Purchasing Integration with General Ledger .................................................................................................2-20
Purchasing Integration with Human Resources.............................................................................................2-21
Purchasing Integration with Payables............................................................................................................2-22
Purchasing Integration with Inventory ..........................................................................................................2-23
Applications Technology Foundation............................................................................................................2-24
Purchasing Integration with Oracle Alert ......................................................................................................2-26
Purchasing Integration with Oracle Workflow ..............................................................................................2-28
Purchasing Integration with e-Commerce Gateway ......................................................................................2-30
Procurement Suite..........................................................................................................................................2-31
Purchasing Integration with Oracle iProcurement .........................................................................................2-33
Purchasing Integration with Oracle iSupplier Portal ....................................................................................2-34
Purchasing Integration with Oracle Sourcing ...............................................................................................2-36
Purchasing Integration with Services Procurement .......................................................................................2-37
Purchasing Integration with Procurement Contracts .....................................................................................2-38
E-Business Suite ............................................................................................................................................2-39
Purchasing Integration with Projects .............................................................................................................2-41
Purchasing Integration with WIP...................................................................................................................2-42
Purchasing Integration with Order Management...........................................................................................2-43
Purchasing Integration with Quality ..............................................................................................................2-44
Purchasing Integration with Advanced Pricing .............................................................................................2-46
Purchasing Integration with ASCP/MRP ......................................................................................................2-47
Purchasing Integration with Assets................................................................................................................2-48
Purchasing Integration with Consigned and Vendor Managed Inventory .....................................................2-49
Purchasing Open Interfaces and APIs ...........................................................................................................2-50
i
Table of Contents
Enterprise Structure Locations, Organizations, and Items ......................................................................3-1

Enterprise Structure Locations, Organizations, and Items..........................................................................3-2
Objectives ......................................................................................................................................................3-3
Agenda...........................................................................................................................................................3-4
What is Enterprise Structure? ........................................................................................................................3-5
The Oracle Enterprise Structure ....................................................................................................................3-6
Ledger Components.......................................................................................................................................3-8
Oracle Purchasing and the Enterprise Structure ...........................................................................................3-10
Oracle Inventory Organizations.....................................................................................................................3-11
Agenda...........................................................................................................................................................3-13
Defining Locations ........................................................................................................................................3-14
Examples of Locations ..................................................................................................................................3-16
Defining Locations in Purchasing..................................................................................................................3-17
Agenda...........................................................................................................................................................3-19
Inventory Organizations ................................................................................................................................3-20
Inventory Organization Setup........................................................................................................................3-21
Defining an Inventory Organization ..............................................................................................................3-22
Financial Impact of Inventory Parameters.....................................................................................................3-24
Purchase Price Variance ................................................................................................................................3-25
Invoice Price Variance...................................................................................................................................3-26
Agenda...........................................................................................................................................................3-27
Define Units of Measure................................................................................................................................3-28
Unit of Measure Setup Steps .........................................................................................................................3-29
Define Unit of Measure Classes and Units of Measure ................................................................................3-30
Examples of Unit of Measure Classes and Units of Measure (UOM)..........................................................3-32
Unit of Measure Conversion..........................................................................................................................3-33
Agenda...........................................................................................................................................................3-35
Item Categories..............................................................................................................................................3-36
Create Item Category Codes..........................................................................................................................3-37
Describing and Using Category Sets .............................................................................................................3-38
Establish the Relationship Between the Category, Category Set and Item....................................................3-39
Agenda...........................................................................................................................................................3-40
What is an Item? ............................................................................................................................................3-41
Oracle Applications That Use Items..............................................................................................................3-42
Flow of Default Values..................................................................................................................................3-44
Item Attributes...............................................................................................................................................3-45
Item Master Organization and Inventory Organizations................................................................................3-47
Overview of Creating an Item .......................................................................................................................3-49
Item Templates ..............................................................................................................................................3-50
Describing Item Attributes - Inventory..........................................................................................................3-52
Describing Item Attributes - Purchasing .......................................................................................................3-55
Describing Item Attributes - Receiving .........................................................................................................3-58
Defining Item Relationships - Purchasing .....................................................................................................3-60
Agenda...........................................................................................................................................................3-62
Additional Setup Considerations ...................................................................................................................3-63
Multiple Organizations Access Control Setup Set Profile Options ............................................................3-65
Enterprise Structure .......................................................................................................................................3-67
Summary........................................................................................................................................................3-69
Suppliers...........................................................................................................................................................4-1
Suppliers ........................................................................................................................................................4-2
Procure to Pay: Suppliers ..............................................................................................................................4-3
Objectives ......................................................................................................................................................4-4
Agenda...........................................................................................................................................................4-5
Overview of Suppliers ...................................................................................................................................4-6
ii
E-Business Suite Setup Practice ....................................................................................................................2-51

Summary........................................................................................................................................................2-52
Document Security, Routing and Approval ..................................................................................................5-1

Document Security, Routing and Approval...................................................................................................5-2
Procurement: Purchasing Documents............................................................................................................5-3
Objectives ......................................................................................................................................................5-4
Agenda...........................................................................................................................................................5-5
Overview of Document Security, Approval and Routing..............................................................................5-6
Agenda...........................................................................................................................................................5-8
Document Security Levels.............................................................................................................................5-9
Document Access Levels...............................................................................................................................5-10
Agenda...........................................................................................................................................................5-11
Document Approval - Jobs and Positions......................................................................................................5-12
Document Routing Option #1: Employee/Supervisor Relationship ..............................................................5-13
Document Routing Option #2: Position Approval Hierarchy........................................................................5-14
Position Approval Hierarchies......................................................................................................................5-16
iii
Purchasing Use of Supplier Information .......................................................................................................4-7

Flow of Default Values..................................................................................................................................4-9
Agenda...........................................................................................................................................................4-10
Supplier Record Structure..............................................................................................................................4-11
Entering Standard Supplier Basic Information ..............................................................................................4-13
Supplier Company Profile .............................................................................................................................4-14
Supplier Profile - Organization......................................................................................................................4-16
Supplier Profile Address Book Supplier Sites ............................................................................................4-17
Supplier Profile Contact Directory .............................................................................................................4-18
Supplier Profile Business Classification.....................................................................................................4-19
Supplier Profile - Banking Details.................................................................................................................4-20
Supplier Terms and Control...........................................................................................................................4-21
Supplier Profile - Accounting........................................................................................................................4-23
Supplier Profile - Tax and Reporting.............................................................................................................4-24
Supplier Profile - Purchasing.........................................................................................................................4-25
Supplier Profile - Receiving ..........................................................................................................................4-27
Supplier Profile Payment Details................................................................................................................4-29
Supplier Profile Invoice Details..................................................................................................................4-31
Suppliers Quick Update Page ........................................................................................................................4-33
Supplier Level Versus Site Level Entry ........................................................................................................4-35
Agenda...........................................................................................................................................................4-36
Maintaining Supplier and Supplier Site Information.....................................................................................4-37
Avoiding Duplicate Suppliers........................................................................................................................4-38
Merging Suppliers .........................................................................................................................................4-40
Data Example - Supplier Merge ....................................................................................................................4-42
Merging Suppliers Reports ............................................................................................................................4-43
Agenda...........................................................................................................................................................4-44
Supplier Reports ............................................................................................................................................4-45
Agenda...........................................................................................................................................................4-49
Financials Options: Supplier-Purchasing.......................................................................................................4-50
Financials Options: Human Resources ..........................................................................................................4-52
Supplier Lookup Codes .................................................................................................................................4-53
Profile Options...............................................................................................................................................4-55
Agenda...........................................................................................................................................................4-56
Responsibility for Supplier Entry/Maintenance.............................................................................................4-57
Supplier Naming Conventions.......................................................................................................................4-58
Supplier Naming Convention Examples........................................................................................................4-60
Supplier Numbering Options.........................................................................................................................4-62
Supplier Conversion Methodology................................................................................................................4-64
Setup of Fax or E-Mail ..................................................................................................................................4-66
iSupplier Portal: Supplier Self-Service..........................................................................................................4-67
Summary........................................................................................................................................................4-68
RFQs and Quotations......................................................................................................................................6-1

RFQs and Quotations.....................................................................................................................................6-2
Procurement: RFQs & Quotations.................................................................................................................6-3
Objectives ......................................................................................................................................................6-4
Agenda...........................................................................................................................................................6-5
RFQs and Quotations.....................................................................................................................................6-6
Agenda...........................................................................................................................................................6-7
Request for Quotation....................................................................................................................................6-8
RFQ Lifecycle ...............................................................................................................................................6-10
Send Notifications .........................................................................................................................................6-11
RFQ Types.....................................................................................................................................................6-12
Supplier List ..................................................................................................................................................6-13
RFQ Structure................................................................................................................................................6-14
RFQ Header...................................................................................................................................................6-15
RFQ Lines .....................................................................................................................................................6-17
RFQ Price Breaks/Shipments ........................................................................................................................6-19
Agenda...........................................................................................................................................................6-20
Quotations......................................................................................................................................................6-21
Quotation Lifecycle .......................................................................................................................................6-23
Send Notifications .........................................................................................................................................6-24
Quotation Types ............................................................................................................................................6-25
Quotation Structure........................................................................................................................................6-26
Quotation Header...........................................................................................................................................6-27
Quotation Lines .............................................................................................................................................6-29
Quotation Price Breaks/Shipments ................................................................................................................6-31
Quotation Approvals......................................................................................................................................6-32
Agenda...........................................................................................................................................................6-33
RFQ and Quotations Reports.........................................................................................................................6-34
Agenda...........................................................................................................................................................6-35
Purchasing Options........................................................................................................................................6-36
RFQ and Quotations Lookup Codes..............................................................................................................6-38
RFQ and Quotations Profile Options.............................................................................................................6-39
Agenda...........................................................................................................................................................6-41
Additional RFQ and Quotations Implementation Considerations .................................................................6-42
Summary........................................................................................................................................................6-44
iv
Document Types - Approval Settings............................................................................................................5-18

Document Types - Control ............................................................................................................................5-20
Creating Approval Groups.............................................................................................................................5-22
Approval Groups - Illustration.......................................................................................................................5-24
Assigning Approval Groups ..........................................................................................................................5-26
Enter People...................................................................................................................................................5-27
Run Fill Employee Hierarchy Process...........................................................................................................5-29
Selecting Approval Paths...............................................................................................................................5-30
Agenda...........................................................................................................................................................5-31
Reports...........................................................................................................................................................5-32
Agenda...........................................................................................................................................................5-33
Financial Options...........................................................................................................................................5-34
Oracle Workflow ...........................................................................................................................................5-35
Global Supervisor/Approver..........................................................................................................................5-37
Agenda...........................................................................................................................................................5-38
Additional Implementation Considerations What if . . . ? .............................................................................5-39
Strengths and Weaknesses of Approvals Using the Employee/Supervisor Relationship ..............................5-43
Strengths and Weaknesses of Approvals Using Position Approval Hierarchies ...........................................5-44
Oracle Approval Manager for Requisitions...................................................................................................5-45
Summary........................................................................................................................................................5-47
Requisitions ......................................................................................................................................................8-1
Requisitions ...................................................................................................................................................8-2
Procurement: Requisitions.............................................................................................................................8-3
Objectives ......................................................................................................................................................8-4
Agenda...........................................................................................................................................................8-5
Where Purchase Requisitions Fit...................................................................................................................8-6
Manual Requisitions from Purchasing and iProcurement..............................................................................8-7
Purchasing Document Flow...........................................................................................................................8-9
Requisition Lifecycle.....................................................................................................................................8-10
Send Requisition Notifications ......................................................................................................................8-11
Agenda...........................................................................................................................................................8-12
Requisition Structure .....................................................................................................................................8-13
Default Value Hierarchy................................................................................................................................8-15
Requisition Preferences .................................................................................................................................8-16
Requisition Header ........................................................................................................................................8-17
Requisition Line ............................................................................................................................................8-19
Requisition Distribution ................................................................................................................................8-22
Allocating Costs to Multiple Charge Accounts .............................................................................................8-23
Submitting Requisitions for Approval...........................................................................................................8-24
Approving Requisitions.................................................................................................................................8-25
Requisition Actions .......................................................................................................................................8-26
Oracle Purchasing Supplier Item Catalog......................................................................................................8-27
Using the Supplier Item Catalog....................................................................................................................8-28
v
Approved Supplier Lists and Sourcing Rules ...............................................................................................7-1

Approved Supplier Lists and Sourcing Rules................................................................................................7-2
Procurement: Supplier Identification.............................................................................................................7-3
Objectives ......................................................................................................................................................7-4
Overview of Sourcing in Purchasing .............................................................................................................7-5
Agenda...........................................................................................................................................................7-6
Approved Supplier Lists ................................................................................................................................7-7
Supplier Statuses ...........................................................................................................................................7-8
ASL Common Header Attributes ..................................................................................................................7-10
ASL Header Attributes - Item........................................................................................................................7-12
ASL Header Attributes - Commodity............................................................................................................7-13
Supplier-Commodity/Item Attributes ............................................................................................................7-15
Supplier-Commodity/Item Attributes Source Document ..............................................................................7-18
Supplier-Commodity/Item Attributes Supplier Scheduling...........................................................................7-20
Supplier-Commodity/Item Attributes Planning Constraints..........................................................................7-22
Agenda...........................................................................................................................................................7-24
Sourcing Rules Overview ..............................................................................................................................7-25
Sourcing Rules...............................................................................................................................................7-26
Oracle Products That Use Sourcing Rules.....................................................................................................7-27
Create a Sourcing Rule ..................................................................................................................................7-28
Create a Sourcing Rule Assignment ..............................................................................................................7-29
Levels of Sourcing Rule Assignments...........................................................................................................7-31
Sourcing Rules with an ASL Source Document............................................................................................7-32
Sourcing Rules without an ASL Source Document.......................................................................................7-33
Default Sourcing Information to Requisitions...............................................................................................7-34
Default Sourcing Information to Standard Purchase Orders .........................................................................7-35
Automatic Sourcing Enablement During Blanket Agreement Approval.......................................................7-36
Generate Sourcing Rules and ASLs from Blanket Agreements Concurrent Program..................................7-38
Agenda...........................................................................................................................................................7-39
Sourcing Profile Options ...............................................................................................................................7-40
Agenda...........................................................................................................................................................7-42
Additional Sourcing Implementation Considerations....................................................................................7-43
Summary........................................................................................................................................................7-45
Purchase Orders ..............................................................................................................................................9-1

Purchase Orders.............................................................................................................................................9-2
Procurement: Purchase Orders ......................................................................................................................9-3
Objectives ......................................................................................................................................................9-4
Agenda...........................................................................................................................................................9-5
Purchasing Document Flow...........................................................................................................................9-6
Creating Purchase Orders ..............................................................................................................................9-7
Purchase Order Types....................................................................................................................................9-9
Purchase Order Components and Record Structure.......................................................................................9-11
Purchase Order Document Structure .............................................................................................................9-13
Overview of Automatic Purchase Order Creation .........................................................................................9-15
Agenda...........................................................................................................................................................9-16
Overview of Standard Purchase Orders.........................................................................................................9-17
Default Value Hierarchy................................................................................................................................9-18
Simplify the Entry of Purchase Orders: Preferences .....................................................................................9-19
Standard Purchase Order Elements................................................................................................................9-21
Structure of a Simple Standard Purchase Order ............................................................................................9-22
Structure of a More Complex Standard Purchase Order................................................................................9-23
Entering Standard Purchase Order Header Information ................................................................................9-24
Standard Purchase Orders Terms and Conditions .........................................................................................9-26
Entering Standard Purchase Order Lines Tabbed Regions............................................................................9-28
Standard Purchase Order Line Items Tabbed Region....................................................................................9-29
Standard Purchase Order Line Price Reference Tabbed Region ...................................................................9-31
vi
Requisition Templates ...................................................................................................................................8-29

Agenda...........................................................................................................................................................8-30
Internally Sourced Requisitions Overview ....................................................................................................8-31
Internal Requisition Integration.....................................................................................................................8-32
Internal Requisitions: Setup Requirements....................................................................................................8-33
Internal Requisition Process ..........................................................................................................................8-35
Controlling Requisition Sourcing ..................................................................................................................8-37
Creating Internal Sales Orders.......................................................................................................................8-38
Creating Internal Sales Orders with OrderImport..........................................................................................8-39
Internally Sourced Requisitions Prerequisites ...............................................................................................8-40
Agenda...........................................................................................................................................................8-41
Requisitions Open Interface ..........................................................................................................................8-42
Oracle Inventory and Requisition Import ......................................................................................................8-44
WIP Outside Processing ................................................................................................................................8-45
Oracle Master Scheduling/MRP and Requisition Import ..............................................................................8-46
Master Scheduling/MRP Group By...............................................................................................................8-47
Requisition Import Process............................................................................................................................8-48
Requisition Import Validation .......................................................................................................................8-50
Requisition Groups ........................................................................................................................................8-52
Requisition Groups: MRP Example ..............................................................................................................8-54
Purchasing Open Interface Tables .................................................................................................................8-55
Agenda...........................................................................................................................................................8-56
Requisition Reports .......................................................................................................................................8-57
Agenda...........................................................................................................................................................8-60
Document Types............................................................................................................................................8-65
Lookup Codes................................................................................................................................................8-67
Expense Account Rules .................................................................................................................................8-68
Profile Options...............................................................................................................................................8-69
Agenda...........................................................................................................................................................8-70
Requisition Implementation Considerations..................................................................................................8-71
Additional Requisition Implementation Considerations................................................................................8-72
Summary........................................................................................................................................................8-74
vii
Standard Purchase Order Line Reference Documents Tabbed Region..........................................................9-32

Standard Purchase Order Line More Tabbed Region ....................................................................................9-33
Standard Purchase Order Line Temporary Labor Tabbed Region................................................................9-34
Entering Standard Purchase Order Shipments - Tabbed Regions..................................................................9-35
Standard Purchase Order Shipment Shipments Tabbed Region ....................................................................9-36
Standard Purchase Order Shipment More Tabbed Region ............................................................................9-38
Standard Purchase Order Shipment Status Tabbed Region ...........................................................................9-40
Standard Purchase Order Shipment Receiving Controls Button....................................................................9-41
Entering Standard Purchase Order Distributions - Tabbed Regions..............................................................9-42
Standard Purchase Order Distribution Destination Tabbed Region ..............................................................9-43
Standard Purchase Order Distribution More Tabbed Region ........................................................................9-45
Standard Purchase Order Distribution Project Tabbed Region......................................................................9-46
Supplier Document Attachments ...................................................................................................................9-47
Approve Standard Purchase Order ................................................................................................................9-48
Agenda...........................................................................................................................................................9-50
When to Use a Blanket Purchase Agreement ................................................................................................9-51
Blanket Releases............................................................................................................................................9-52
Blanket Purchase Agreements Additional Information Entered....................................................................9-54
Blanket Purchase Agreements Additional Information - Header ..................................................................9-55
Blanket Purchase Agreements Additional Information - Lines .....................................................................9-57
Blanket Purchase Agreements Additional Information - Price Breaks..........................................................9-59
Notification Controls .....................................................................................................................................9-61
Approve Blanket Purchase Agreement..........................................................................................................9-63
Blanket Purchase Agreement and Blanket Releases......................................................................................9-64
Blanket Releases Structure - Header .............................................................................................................9-65
Blanket Releases Structure Shipments and Distributions ..............................................................................9-67
Center-Led Procurement................................................................................................................................9-68
Creating Global Blanket Agreements ............................................................................................................9-69
Agenda...........................................................................................................................................................9-71
When to Use a Contract Purchase Agreement...............................................................................................9-72
Contract Purchase Agreements Additional Information Entered...................................................................9-73
Standard Purchase Order Line Reference Documents Tabbed Region..........................................................9-75
Creating Global Contract Agreements...........................................................................................................9-76
Agenda...........................................................................................................................................................9-77
When to Use a Planned Purchase Order ........................................................................................................9-78
Components of a Planned Purchase Order.....................................................................................................9-80
Planned Purchase Order Information Entered ...............................................................................................9-81
Agenda...........................................................................................................................................................9-82
Purchase Order Inquiry..................................................................................................................................9-83
Modifying Purchase Orders...........................................................................................................................9-85
Printing Purchase Orders ...............................................................................................................................9-86
Creating Purchase Order Revisions ...............................................................................................................9-87
Document Publishing ....................................................................................................................................9-88
Archiving Purchase Orders............................................................................................................................9-90
Purchase Order Statuses - Typical Cycle.......................................................................................................9-91
Entering Purchase Order Acceptances...........................................................................................................9-94
Workflow Notifications.................................................................................................................................9-96
Copying Purchase Orders ..............................................................................................................................9-97
Agenda...........................................................................................................................................................9-99
Purchase Document Interfaces ......................................................................................................................9-100
Purchasing Documents Open Interface..........................................................................................................9-101
Purchase Document Import Validation..........................................................................................................9-103
Purchasing APIs ............................................................................................................................................9-105
Agenda...........................................................................................................................................................9-107
Purchase Order Reports .................................................................................................................................9-108
Agenda...........................................................................................................................................................9-111
Automating Document Creation ....................................................................................................................10-1

Automating Document Creation....................................................................................................................10-2
Objectives ......................................................................................................................................................10-4
Agenda...........................................................................................................................................................10-5
Creating Purchase Documents from Requisitions .........................................................................................10-6
Benefits of using AutoCreate.........................................................................................................................10-7
Overview of AutoCreate................................................................................................................................10-8
Automatic Creation Mode .............................................................................................................................10-10
Find Requisition Lines...................................................................................................................................10-11
Select Document Creation Criteria ................................................................................................................10-12
Select Requisition Lines ................................................................................................................................10-14
Select Automatic Creation Mode...................................................................................................................10-15
Autocreate New Document Window.............................................................................................................10-16
Manual Creation Mode..................................................................................................................................10-17
Add to Existing Document ............................................................................................................................10-18
Modify Requisition Lines..............................................................................................................................10-19
Return Requisition Lines ...............................................................................................................................10-20
Agenda...........................................................................................................................................................10-21
Benefits of using the Create Releases Program .............................................................................................10-22
Overview of the Create Releases Program ....................................................................................................10-23
Automatic Release Generation ......................................................................................................................10-24
Running the Create Releases Program...........................................................................................................10-26
Create Releases Document Creation Prerequisites ........................................................................................10-28
Agenda...........................................................................................................................................................10-30
Benefits of Automatic Document Creation using Workflow.........................................................................10-31
Overview of Automatic Document Creation using Workflow ......................................................................10-32
Workflow Document Creation Overview......................................................................................................10-33
Workflow Document Creation Prerequisites .................................................................................................10-34
PO Create Documents Workflow ..................................................................................................................10-36
Setting Key Workflow Attributes ..................................................................................................................10-38
Workflow Document Creation Summary ......................................................................................................10-40
Agenda...........................................................................................................................................................10-41
Automatic Document Creation Profile Options.............................................................................................10-42
viii
Important Purchasing Options .......................................................................................................................9-112

Important Profile Options ..............................................................................................................................9-114
PO Communication Profile Options ..............................................................................................................9-116
Other Setups ..................................................................................................................................................9-117
Transaction Delivery Setup ...........................................................................................................................9-119
Printed Purchase Orders ................................................................................................................................9-120
Purchasing Document Fax Setup Overview ..................................................................................................9-122
Purchasing Document E-Mail Setup Overview............................................................................................9-124
Oracle e-Commerce Gateway Overview .......................................................................................................9-126
Purchase Order EDI Transactions..................................................................................................................9-128
Oracle XML Gateway Overview...................................................................................................................9-129
Purchase Order XML Transactions ...............................................................................................................9-131
Retroactive Price Changes.............................................................................................................................9-132
Agenda...........................................................................................................................................................9-133
Responsibility for Purchase Order Entry and Maintenance...........................................................................9-134
Purchase Order Integration Issues .................................................................................................................9-135
Creating Purchase Orders and Releases.........................................................................................................9-136
Purchase Order Numbering Options..............................................................................................................9-138
Purchase Order Conversion Methodology.....................................................................................................9-139
Electronic Transaction Delivery ....................................................................................................................9-141
Integrated Oracle Products ............................................................................................................................9-143
Summary........................................................................................................................................................9-144
Professional Buyer's Work Center.................................................................................................................11-1

Professional Buyer's Work Center.................................................................................................................11-2
Objectives ......................................................................................................................................................11-3
Procure to Pay: Procurement .........................................................................................................................11-4
Agenda...........................................................................................................................................................11-5
What is the Professional Buyer's Work Center? ............................................................................................11-6
Business Benefits of the Buyer's Work Center ..............................................................................................11-7
Buyer's Work Center Overview.....................................................................................................................11-8
Agenda...........................................................................................................................................................11-9
Demand Workbench and Requisition Summary............................................................................................11-10
Demand Workbench Requisition Views........................................................................................................11-12
Create A Personalized Requisition View.......................................................................................................11-14
Requisition Summary ....................................................................................................................................11-15
Managing Requisitions in the Buyer's Work Center......................................................................................11-16
Agenda...........................................................................................................................................................11-17
Default and Personalized Order Views..........................................................................................................11-18
Order Details .................................................................................................................................................11-20
Document Styles............................................................................................................................................11-21
Creating a Purchase Order in the Buyer's Work Center................................................................................11-23
Unified Procurement Catalog Access ............................................................................................................11-25
Agenda...........................................................................................................................................................11-26
Default and Personalized Agreement Views .................................................................................................11-27
Agreement Details .........................................................................................................................................11-29
Creating a Purchase Agreement in the Buyer's Work Center .......................................................................11-30
Uploading Blanket Agreement Lines ............................................................................................................11-32
Agenda...........................................................................................................................................................11-33
Buyer's Work Center Profile Options ............................................................................................................11-34
Requisition Management Key Profile Options ...........................................................................................11-35
Enhanced Catalog Access Setup Preferences ................................................................................................11-37
Agenda...........................................................................................................................................................11-38
Additional Implementation Considerations ...................................................................................................11-39
Oracle Sourcing and Document Creation ......................................................................................................11-40
Summary........................................................................................................................................................11-41
Receiving ..........................................................................................................................................................12-1
Receiving.......................................................................................................................................................12-2
Objectives ......................................................................................................................................................12-4
Agenda...........................................................................................................................................................12-5
What is Receiving?........................................................................................................................................12-6
Overview of Receiving Locations .................................................................................................................12-8
Agenda...........................................................................................................................................................12-9
Overview of Receipt Routing ........................................................................................................................12-10
Direct Receipt Routing ..................................................................................................................................12-11
Standard Receipt............................................................................................................................................12-12
Inspection Required.......................................................................................................................................12-13
Oracle Process Quality Integration ................................................................................................................12-14
Agenda...........................................................................................................................................................12-15
Receipt Processing Methods..........................................................................................................................12-16
Standard Receipt............................................................................................................................................12-18
Express Receipt .............................................................................................................................................12-19
Cascade Receipt.............................................................................................................................................12-20
ASNs and ASBNs..........................................................................................................................................12-21
ix
Agenda...........................................................................................................................................................10-44
Oracle Sourcing and Document Creation ......................................................................................................10-46
Summary........................................................................................................................................................10-47
Purchasing Accounting ...................................................................................................................................13-1

Purchasing Accounting..................................................................................................................................13-2
Objectives ......................................................................................................................................................13-3
Agenda...........................................................................................................................................................13-4
Overview of the Procure to Pay Period Close ..............................................................................................13-5
Close the PO Period Steps .............................................................................................................................13-6
Close the PO Period Business Flow ..............................................................................................................13-7
Agenda...........................................................................................................................................................13-10
Key Accounts in Procure to Pay ....................................................................................................................13-11
Accrual Accounting Perpetual Accrual (On Receipt)....................................................................................13-13
Accrual Reconciliation Process .....................................................................................................................13-15
Accrual Accounting Periodic Accrual (Period End)......................................................................................13-17
Accounting for Mass Additions Periodic Accrual (Period End)....................................................................13-19
Accounting for Payments with Cash in Transit (Cash Clearing)...................................................................13-21
Accounting for Payments without Cash in Transit (Cash Clearing)..............................................................13-22
Agenda...........................................................................................................................................................13-23
Foreign Currency in Purchasing ....................................................................................................................13-24
Exchange Rate Overview ..............................................................................................................................13-25
Currency Similarities Between Requisitions and Purchase Orders ...............................................................13-26
Currency Differences Between Requisitions and Purchase Orders ...............................................................13-27
Requisitions and Automatically Created Purchase Orders Using Foreign Currency.....................................13-29
Approving Requisitions and Purchase Orders Using Foreign Currency........................................................13-30
Invoice Currency Matching ...........................................................................................................................13-31
Agenda...........................................................................................................................................................13-32
x
Desktop Receiving in iProcurement ..............................................................................................................12-22

Entering Expected Receipts...........................................................................................................................12-23
Receipt Structure ...........................................................................................................................................12-25
Receipt Header ..............................................................................................................................................12-27
Receipt Line...................................................................................................................................................12-28
Control the Receiving Transaction Processor................................................................................................12-30
Receiving Tolerances ....................................................................................................................................12-32
Control Numbers ...........................................................................................................................................12-33
Agenda...........................................................................................................................................................12-35
Substitute Receipts ........................................................................................................................................12-36
Unordered Receipts .......................................................................................................................................12-37
Overview of Returns and Corrections ...........................................................................................................12-38
Entering Returns ............................................................................................................................................12-39
Entering Corrections......................................................................................................................................12-41
Comparing Returns and Corrections..............................................................................................................12-42
Overview of Pay on Receipt ..........................................................................................................................12-43
Agenda...........................................................................................................................................................12-45
Receiving Open Interface (ROI)....................................................................................................................12-46
ROI Supported Transactions..........................................................................................................................12-47
Load the Receiving Open Interface ...............................................................................................................12-48
Receipt Import Validation .............................................................................................................................12-49
Agenda...........................................................................................................................................................12-51
Receiving Reports..........................................................................................................................................12-52
Agenda...........................................................................................................................................................12-55
Receiving Options .........................................................................................................................................12-57
Receiving Profile Options..............................................................................................................................12-61
ASN and ASBN Electronic Receipts.............................................................................................................12-63
Agenda...........................................................................................................................................................12-65
Summary........................................................................................................................................................12-68
Purchasing Administration.............................................................................................................................14-1
Purchasing Administration ............................................................................................................................14-2
Objectives ......................................................................................................................................................14-3
Agenda...........................................................................................................................................................14-4
Maintaining Your Oracle Purchasing Database Records...............................................................................14-5
Integration with Payables ..............................................................................................................................14-6
What is MassCancel?.....................................................................................................................................14-7
Using Purchasing MassCancel ......................................................................................................................14-8
The Define MassCancel Listing ....................................................................................................................14-9
Purge Overview .............................................................................................................................................14-10
Preparing for a Purge.....................................................................................................................................14-12
Purge Category Inclusion ..............................................................................................................................14-13
Conditions for a Purge: Purchasing ...............................................................................................................14-15
Conditions for a Purge: Payables...................................................................................................................14-17
Purge Reports ................................................................................................................................................14-19
Restarting or Aborting a Purge ......................................................................................................................14-20
Purge Summary Information .........................................................................................................................14-21
Recommendations for Efficient Purging .......................................................................................................14-23
Agenda...........................................................................................................................................................14-24
Start Concurrent Managers ............................................................................................................................14-25
Schedule Background Processes....................................................................................................................14-26
Schedule Other Processes ..............................................................................................................................14-28
Agenda...........................................................................................................................................................14-30
Purge: Issues to Consider ..............................................................................................................................14-31
Summary........................................................................................................................................................14-33
Appendix A - Setup Steps ...............................................................................................................................15-1
Appendix A - Setup Steps..............................................................................................................................15-2
Objectives ......................................................................................................................................................15-3
Agenda...........................................................................................................................................................15-4
Setting Up Purchasing ...................................................................................................................................15-5
Define Users for Setup Tasks ........................................................................................................................15-6
Define a Ledger .............................................................................................................................................15-8
Define Human Resources Key Flexfields......................................................................................................15-9
Set Address Style Default..............................................................................................................................15-10
Define Locations............................................................................................................................................15-11
Define Organizations.....................................................................................................................................15-12
Create Responsibilities ..................................................................................................................................15-14
Set Key Profile Options.................................................................................................................................15-15
Convert to Multi-Org.....................................................................................................................................15-16
Set Up Descriptive Flexfields........................................................................................................................15-17
Define Purchasing Lookups and Codes .........................................................................................................15-18
Define Payment Terms ..................................................................................................................................15-19
Define Tax .....................................................................................................................................................15-20
Define Freight Carriers..................................................................................................................................15-21
Define Financials Options .............................................................................................................................15-22
Define Inventory Key Flexfields ...................................................................................................................15-24
Set Up Shorthand Aliases ..............................................................................................................................15-25
Define Units of Measure................................................................................................................................15-26
xi
Reports...........................................................................................................................................................13-33
Agenda...........................................................................................................................................................13-38
Financials Options .........................................................................................................................................13-39
Payables Options ...........................................................................................................................................13-42
Agenda...........................................................................................................................................................13-45
Purchasing Accounting Implementation Considerations...............................................................................13-46
Summary........................................................................................................................................................13-48
xii
Define Standard Attachments ........................................................................................................................15-27

Define Item Attributes, Codes, and Templates..............................................................................................15-29
Define Category Codes and Category Sets....................................................................................................15-31
Define Catalog Groups ..................................................................................................................................15-32
Define Subinventories ...................................................................................................................................15-33
Define Cross-Reference Types ......................................................................................................................15-34
Define Jobs, Positions, and Position Hierarchies...........................................................................................15-35
Define Personnel ...........................................................................................................................................15-36
Define Approval Groups and Assignments ...................................................................................................15-37
Define Buyers................................................................................................................................................15-38
Set Up Document Types................................................................................................................................15-39
Define Lookup Codes and Classes ................................................................................................................15-40
Define Line Types .........................................................................................................................................15-41
Define Purchasing Options ............................................................................................................................15-42
Define Receiving Options..............................................................................................................................15-43
Set Address Style Default..............................................................................................................................15-44
Define Suppliers ............................................................................................................................................15-45
Set Up Credit Card Programs ........................................................................................................................15-46
Define Items ..................................................................................................................................................15-47
Modify Account Generator............................................................................................................................15-48
Set Up Workflow Options .............................................................................................................................15-49
Start Concurrent Managers ............................................................................................................................15-50
Schedule Background Processes....................................................................................................................15-51
Set Up Sourcing Rules and Assignments ......................................................................................................15-53
Open Accounting Periods ..............................................................................................................................15-54
Perform Additional System Administration ..................................................................................................15-55
Create Folders................................................................................................................................................15-56
Agenda...........................................................................................................................................................15-58
Reports...........................................................................................................................................................15-59
Agenda...........................................................................................................................................................15-63
Profile Options (Required) ............................................................................................................................15-64
Profile Options (Recommended) ...................................................................................................................15-66
Profile Options (Review)...............................................................................................................................15-67
Profile Options (Overlooked) ........................................................................................................................15-69
Summary........................................................................................................................................................15-70
Preface
Profile
Before You Begin This Course
Thorough knowledge of Oracle Applications
Working experience with procurement
Prerequisites
Oracle Applications Foundations
How This Course Is Organized

R12 Oracle Purchasing Fundamentals Ed 2 is an instructor-led course featuring lecture and
hands-on exercises. Online demonstrations and written practice sessions reinforce the concepts
and skills introduced.
xiii
Before you begin this course, you should have the following qualifications:
Related Publications
Oracle Publications
Title
Oracle Purchasing Users Guide

Oracle Payables Users Guide
Oracle Inventory Users Guide
Additional Publications
System release bulletins
Installation and users guides
Read-me files
International Oracle Users Group (IOUG) articles
Oracle Magazine
xiv
Oracle Manufacturing APIs and Open Interfaces Manual
Typographic Conventions
Typographic Conventions in Text
Caps and
lowercase
Courier new,
case sensitive
(default is
lowercase)
Initial cap
Element
Glossary term (if
there is a glossary)
Buttons,
check boxes,
triggers,
windows
Code output,
directory names,
filenames,
passwords,
pathnames,
URLs,
user input,
usernames
Arrow
Brackets
Commas
Graphics labels
(unless the term is a
proper noun)
Emphasized words
and phrases,
titles of books and
courses,
variables
Interface elements
with long names
that have only
initial caps;
lesson and chapter
titles in crossreferences
SQL column
names, commands,
functions, schemas,
table names
Menu paths
Key names
Key sequences
Plus signs
Key combinations
Italic
Quotation
marks
Uppercase
Example
The algorithm inserts the new key.
Click the Executable button.
Select the Cant Delete Card check box.
Assign a When-Validate-Item trigger to the ORD block.
Open the Master Schedule window.
Code output: debug.set (I, 300);
Directory: bin (DOS), $FMHOME (UNIX)
Filename: Locate the init.ora file.
Password: User tiger as your password.
Pathname: Open c:\my_docs\projects
URL: Go to http://www.oracle.com
User input: Enter 300
Username: Log on as scott
Customer address (but Oracle Payables)
Do not save changes to the database.

For further information, see Oracle7 Server SQL Language
Reference Manual.
Enter user_id@us.oracle.com, where user_id is the
name of the user.
Select Include a reusable module component and click Finish.
This subject is covered in Unit II, Lesson 3, Working with
Objects.
Use the SELECT command to view information stored in the

LAST_NAME
column of the EMP table.
Select File > Save.
Press [Enter].
Press and release keys one at a time:
[Alternate], [F], [D]
Press and hold these keys simultaneously: [Ctrl]+[Alt]+[Del]
xv
Convention
Bold italic
Typographic Conventions in Code

Element
Oracle Forms
triggers
Column names,
table names
Example
When-Validate-Item
Passwords
DROP USER scott

IDENTIFIED BY tiger;
OG_ACTIVATE_LAYER
(OG_GET_LAYER (prod_pie_layer))
SELECT last_name
FROM s_emp;
PL/SQL objects
Lowercase
italic
Uppercase
CREATE ROLE role
Syntax variables
SQL commands and SELECT userid

FROM emp;
functions
Typographic Conventions in Oracle Application Navigation Paths

This course uses simplified navigation paths, such as the following example, to direct you
through Oracle Applications.
(N) Invoice > Entry > Invoice Batches Summary (M) Query > Find (B) Approve
This simplified path translates to the following:
1.
(N) From the Navigator window, select Invoice then Entry then Invoice Batches
Summary.
2.
(M) From the menu, select Query then Find.
3.
(B) Click the Approve button.
Notations:
(N) = Navigator
(M) = Menu
(T) = Tab
(B) = Button
(I) = Icon
(H) = Hyperlink
(ST) = Sub Tab
xvi
Convention
Caps and
lowercase
Lowercase
Typographical Conventions in Oracle Application Help System Paths

This course uses a navigation path convention to represent actions you perform to find
pertinent information in the Oracle Applications Help System.
The following help navigation path, for example
(Help) General Ledger > Journals > Enter Journals
1.
In the navigation frame of the help system window, expand the General Ledger entry.
2.
Under the General Ledger entry, expand Journals.
3.
Under Journals, select Enter Journals.
4.
Review the Enter Journals topic that appears in the document frame of the help system
window.
xvii
represents the following sequence of actions:

THESE eKIT MATERIALS ARE FOR YOUR USE IN THIS CLASSROOM ONLY. COPYING eKIT MATERIALS FROM THIS
Chapter 9
Purchase Orders
Chapter
9 - Page 1 ONLY. COPYING eKIT MATERIALS FROM THIS
THESE eKIT MATERIALS ARE FOR YOUR USE IN THIS
CLASSROOM
Purchase Orders
Purchase Orders
Purchase Orders
Chapter
CLASSROOM
Procurement: Purchase Orders

Oracle Purchasing provides the functionality to complete the procurement portion of the
Procure to Pay process.
In the Oracle Procurement Suite of applications, ordering is a term generally used to indicate a
business flow that results in a purchase of goods or services.
Purchase Orders
Chapter
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Objectives
Purchase Orders
Chapter
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Agenda
Purchase Orders
Chapter
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Purchasing Document Flow

A requisition is generated either manually or by the system, which may be turned into a
purchase order by the buyer. Sometimes the buyer decides a request for quotation (RFQ) is
required by other suppliers to determine the best price for the goods or services requested.
Once the quote is received back, that information can be used to finalize the purchase order.
Purchase Orders
Chapter
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Purchasing Document Flow
Creating Purchase Orders

Purchase orders are created based on demand from many sources, some of them outside of the
Procure to Pay applications. Note that some demand is satisfied from internal supplies.
Demand for Goods or Services
Import requisitions created from demand generated in Materials Requirements Planning
(MRP), Inventory, Work-in-Process (WIP), Order Management or other non-Oracle systems.
Demand can also be generated manually through detail entry, with the assistance of requisition
templates, or through Oracle iProcurement.
Procurement Sourcing
Goods or services can be sourced from external suppliers through the creation of purchase
orders or from within the organization through the creation of internal sales orders.
Services Procurement
Using Oracle Services Procurement, organizations can efficiently manage the procurement of
contingent labor resources.
Purchase Orders
Chapter
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Creating Purchase Orders
Oracle Sourcing (not shown above)

Buyers create Oracle Sourcing negotiation documents from the requisition pool. Once buyers
have made their award decisions in Oracle Sourcing, they create standard purchase orders or
blanket purchase agreements directly in Oracle Purchasing.
Oracle Procurement Contracts
Since a purchase order is a legally binding contract with a supplier, buyers can add complex
contractural language and terms to the purchase order from a library of terms that have been
approved by the legal department. This is managed through Oracle Procurement Contracts.
Purchase Orders
Chapter
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Purchase Order Types

In Oracle Purchasing there are several different types of purchase orders designed to satisfy
different business requirements.
Standard Purchase Order (PO)
A one-time commitment to purchase goods or services. You create standard purchase orders
when you know the details of the goods or services, estimated costs, quantities, delivery
schedules, and accounting distributions.
Planned Purchase Order
A long-term purchase agreement committing you to buy goods or services. Planned purchase
orders include tentative delivery schedules and accounting distributions. Create planned
releases to authorize suppliers to ship.
Blanket Purchase Agreement
A long-term agreement allowing for stable pricing over the life of the agreement, while also
allowing flexible order quantity commitments and delivery schedules. Pricing on blanket
purchase agreements can include break pricing. You typically use this agreement when
negotiating volume discounts on individual items. Create blanket releases to authorize
suppliers to ship.
Purchase Orders
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Purchase Order Types
Purchase Orders
Chapter
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Contract Purchase Agreement

A master terms and conditions document. Typically use contract purchase agreements when
negotiating pricing on a volume of business to manage terms and conditions. Suppliers are
authorized to ship through standard purchase order lines referencing the contract. Contracts
can be coupled with a catalog quotation to reference pricing on a per item basis.
Global Agreement (not shown above)
A special type of purchase agreement that is similar in structure to a blanket purchase
agreement. Using global agreements, buyers can negotiate enterprise-wide pricing, business by
business, then execute and manage those global agreements in one central shared services
environment. Organizations within the enterprise then access the agreement to create purchase
orders that leverage the pre-negotiated prices and terms.
Note: Global agreements can be either Blanket or Contract Purchase Agreements.
Purchase Order Components and Record Structure

The structure of an Oracle Purchasing purchase order consists of four major components.
Header
Each purchase order has a header that provides the suppliers name/number and address
(through sites), basic ship-to and bill-to addresses (through locations) and a status.
Lines
Goods or services ordered are listed on the Lines region, including quantities, price, need-by
date, notes to supplier and price reference information. You can order system items or onetime items (a category and description). Even companies who are not inventory focused can
benefit from defining system items to reduce data entry requirements for their staff.
Shipments
Use the Shipments window to specify inventory organizations, ship-to locations and the date
you want your supplier to deliver the items on the purchase order line. A purchase order line
with a quantity of six items can, for example, have two scheduled shipments on separate dates.
Purchase Orders
Chapter
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Purchase Order Components and Record Structure
Distributions
Use the purchase order Distributions window to enter distribution information for purchase
order shipments or to view distributions that Purchasing has automatically created for you. You
can enter multiple distributions per shipment line. You can also view the on-line requisitions
included on the purchase order or enter information about paper requisitions in this window.
Purchase Orders
Chapter
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Purchase Order Documents Structure

This is a simplified entity relationship diagram (ERD) for purchase order documents. For
complete details of all tables that are involved with purchase orders, see the Oracle eBusiness
Suite Electronic Technical Reference Manual that is available from OracleMetaLink.
PO_HEADERS_ALL
PO_HEADERS_ALL (header) contains information for your purchase order documents. Each
row contains buyer information, supplier information, notes, foreign currency information,
terms and conditions information, and the document status. Oracle Purchasing uses this
information to record information related to a complete document. The primary key is POHEADER_ID.
PO_LINES_ALL
PO_LINES_ALL (lines) stores current information about each purchase order line. You need
one row for each line you attach to a document. Each row includes the line number, item
number and category unit, price, tax information, and quantity ordered for the line. Oracle
Purchasing uses this information to record and update item and price information for purchase
orders, quotations, and RFQs. The primary key is PO_LINE_ID.
Purchase Orders
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Purchase Order Document Structure
Purchase Orders
Chapter
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PO_LINE_LOCATIONS_ALL
This table (shipments) contains information about purchase order shipment schedules and
blanket agreement price breaks. You must have one row for each schedule or price break you
attach to a document line. Each row contains the location, quantity, and dates for each
shipment schedule. Oracle Purchasing uses this information to record delivery schedule
information for purchase orders and price break information for blanket purchase orders,
quotations, and RFQs. The primary key is LINE_LOCATION_ID.
PO_DISTRIBUTIONS_ALL
PO_DISTRIBUTIONS_ALL (distributions) contains accounting information for a purchase
order shipment line. Oracle Purchasing uses this information to record accounting and
requisition information for purchase orders and releases. It is one of five tables that stores
purchase orders and releases. The primary key is PO_DISTRIBUTION_ID.
PO_RELEASES_ALL
This table contains information about blanket and planned purchase order releases. You need
one row for each release you issue for a blanket or planned purchase order. Each row includes
the buyer, date, release status, and release number. Each release must have at least one
purchase order shipment (PO_LINE_LOCATIONS_ALL). The primary key is
PO_RELEASE_ID.
Overview of Automatic Purchase Order Creation

Automatic purchase order creation is discussed in detail in the Automatic Document Creation
topic of this course.
Purchase Orders
Chapter
CLASSROOM
Overview of Automatic Purchase Order Creation
Agenda
Purchase Orders
Chapter
CLASSROOM
Overview of Standard Purchase Orders

You generally create standard purchase orders for one-time purchases of various items when
you know the details of the goods or services you require, including costs, quantities, delivery
schedules and accounting distributions. Each standard purchase order line can have multiple
shipments, and you can distribute the quantity of each shipment across multiple charge
accounts, projects, tasks and requestors.
Binding agreement
The original copy of the purchase order you send to your supplier is a legal offer to buy. A
binding purchase contract does not exist until the supplier accepts your offer either by
performing the contract (by shipping goods) or formally accepting the offer by contacting you
verbally or in writing. You can record acceptances on behalf of your suppliers or they can do it
using iSupplier Portal. The Send Notifications for Purchasing Documents process will send
you a notification if a required acceptance is not recorded by the required date.
Purchase Orders
Chapter
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Overview of Standard Purchase Orders
Default Value Hierarchy

Defaults set at higher levels flow down to lower levels where you can override them.
Defaults reduce data entry by providing default values based on corporate policy. Optional
defaults (especially the higher level ones) should be left blank if you frequently override
them.
Note: Changes to default values affect only new records, not existing records.
Details of default values and how they are selected for a purchase order field can be found in
the Purchase Order Defaulting Rules section of the Oracle Purchasing Users Guide.
Purchase Orders
Chapter
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Default Value Hierarchy
Simplify the Entry of Purchase Orders - Preferences

Use the Preferences window to enter values that will default to all purchase order headers,
lines, shipments and distributions that you enter. By using preferences, you have essentially
gained an additional level of defaults in the Default Value Hierarchy. Recall that the
Purchasing Default Value Hierarchy includes the following: Financials Options,
Purchasing/Receiving Options, Supplier, Supplier Site, Item and PO Documents.
Benefits of Using Preferences
Although setting preferences is optional, you will want to selectively enter preferences for data
that would be repetitively entered on multiple lines, shipments or distributions. Preferences,
therefore, reduce the amount of data entry required to complete purchase orders. For example,
if youre creating a purchase order for four items, all of which are needed by the same date,
specify a Need-By date in the Preferences window that will default to all four lines. If,
however, all four items were needed by a different date, it wouldnt save any time to use the
Preferences window to specify a Need-By date.
Purchase Orders
Chapter
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Simplify the Entry of Purchase Orders: Preferences
How Long are Preferences Effective?

Session preferences must be set each time you log into the applications or even change
responsibilities. While in a session, however, preferences remain in effect unless you
explicitly clear or change them.
Apply Preferences to Save
Once the desired preferences have been set, you must click the Apply button to save them. If
you simply close the Preferences window, either no preferences will be set or previously set
preferences will remain in effect.
Purchase Orders
Chapter
CLASSROOM
Standard Purchase Order Elements

Purchasing Responsibility
(N) Purchase Orders > Purchase Orders
The standard purchase order has all major components and allows a supplier to locate and
deliver the goods or services ordered. All purchase order types represent some combination of
the basic structural elements of the standard purchase order.
Header - Contains the purchase order number, the suppliers name and address, basic
ship-to and bill-to addresses, and the status.
Line - Details of the goods or services ordered, including name, quantity and price.
Shipment - Details of when and where to deliver items.
Distribution - Details of charge accounts and requisition references.
Purchase Orders
Chapter
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Standard Purchase Order Elements
Structure of a Simple Standard Purchase Order

The structure displayed above shows a purchase order with two items being ordered (Line 1
and Line 2). Each item is expected to be shipped on the same day to a single address.
Furthermore, each item is charged to a single charge account.
Purchase Orders
Chapter
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Structure of a Simple Standard Purchase Order
Structure of a More Complex Standard Purchase Order

The structure displayed above shows a purchase order with two items being ordered (line 1 and
line 2). Line 1, however, has a single shipment with multiple distributions while line 2 has
multiple shipments, each with a single distribution. Notice that you cannot equate the number
associated with a shipment line or distribution line with an item line. For example, distribution
2 does not belong to shipment 2 or line 2. Distribution 2 actually belongs to shipment 1 which
belongs to item line 1.
Purchase Orders
Chapter
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Structure of a More Complex Standard Purchase Order
Entering Standard Purchase Order Header Information

These are the major fields entered when creating a standard purchase order header.
PO Number: The system will generate a PO number when the document is saved, if PO
automatic number generation is enabled. If manual numbering is enabled, you must enter a
unique PO number.
PO Type: Select Standard Purchase Order for this field.
Creation Date: This will be the date that the document was initially saved. It may be the same
day, the next week or the next month before the purchase order is submitted for approval.
Supplier, Site and Contact: The list of values on the Supplier field contains active suppliers.
The list of values on the site field contains active sites that are designated as purchasing sites
on the General tabbed region for the site. If you cannot find the desired supplier or site, you
may need to request that it be defined. Choose a contact using the list of values if contacts are
defined and no contact defaults.
Ship-to and Bill-to Locations: Ship-to and Bill-to locations default based on the supplier and
site you select. You can override the values that default.
Currency: The functional currency defaults. Use the Currency button to change the functional
currency if you are using multiple currencies.
Purchase Orders
Chapter
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Entering Standard Purchase Order Header Information
Buyer: The defaulted buyer is the employee name associated with the user name of the person
creating the purchase order. If the Enforce Buyer Name option in the Purchasing Options
window is set to Yes, you will not be able to override the default.
Status: The status of a newly created purchase order is Incomplete. The status will be updated
by the system based on actions taken by buyers or approvers.
Total: The total of the purchase order is displayed based on the extended line totals.
Description: You can enter comments in the 240 character description field. Although the
description does not print on the printed purchase order, suppliers can use it if they have access
to the system with Oracle iSupplier Portal.
Purchase Orders
Chapter
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Standard Purchase Orders - Terms and Conditions

Payment terms: Specify payment terms indicate when you are expected to make payment for
the goods or services received. The terms may include an amount due, as well as a discount
amount. Commonly used payment terms are Net 30 or 2/10, Net/30. You can create additional
payment terms as necessary.
Freight terms: Specify freight terms to indicate who is responsible for the direct charges
related to transporting shipped goods. Commonly used freight terms include Due (indicating
you pay the freight charges) or Prepaid (indicating that the supplier will pay for the freight
charges).
Carrier: Specify the name of the freight carrier responsible for physical transportation of the
goods.
FOB, or Free-On-Board: Specify FOB to indicate the point at which ownership of the goods
(and therefore costs of loss or damage) transfers from the supplier to you. Commonly used
FOB terms include Origin (indicating that ownership transfers at the point when the supplier
delivers the goods to the carrier) and Destination (indicating that ownership transfers at the
point when the carrier delivers the goods to you).
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Pay On: Provides a default value of Receipt if the selected supplier site has been enabled for
the Pay on Receipt functionality. If Receipt is selected, an invoice will be automatically
created for this purchase order when receipt of the goods has been acknowledged and you run
the Pay on Receipt AutoInvoice process. If you do not want an invoice to be created, you can
clear the value that defaults into the field.
Special Conditions:
Confirming Order - Indicates that youve already communicated the order to the supplier
and this purchase order is simply providing written confirmation. When you select the
Confirming Order option, the words This is a confirming order. Do not duplicate. will
be included on the printed purchase order.
Firm - This is a setting used with MRP to indicate to that module that it can neither
change the details nor suggest changes to the details of the purchase order based on
changed demands that have occurred since the order was originally created.
Acceptance Required - Indicates whether acknowledgement of receipt of the purchase
order is requested from the supplier. When the box is checked, the buyer can also provide
the date by which that acknowledgement is requested.
Note
Supplier Note - This field can be used to enter up to 240 characters which will print on the
purchase order sent to the supplier.
Receiver Note - This field also allows up to 240 characters to be entered, but will not be
printed on the purchase order. Notes to receiver can be viewed by users entering actual
receipt transactions.
Entering Standard Purchase Order Lines - Tabbed Regions

Enter initial information regarding the goods or services being ordered in the tabbed regions
for the line. If sufficient valid default information is available, Purchasing creates shipments
and distributions for each line.
Items Tabbed Region: Enter basic information such as the items, descriptions, quantities, and
dates needed.
Price Reference Tabbed Region: Pricing information will default in this tabbed region from
the item definition.
Reference Documents Tabbed Region: Use the Reference Documents tabbed region to
reference contracts or catalog quotations when purchasing items from established agreements.
If you have associated a catalog quotation with an approved supplier list or are have set the PO:
Automatic Document Sourcing profile option to Yes, and have valid quotations in the system,
quotation information will default.
More Tabbed Region: Enter information regarding hazardous materials and supplier notes in
this tabbed region.
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Entering Standard Purchase Order Lines Tabbed Regions
Standard Purchase Order Line - Items Tabbed Region

Num: The system will automatically generate a unique line number for each line you create.
Type: The value that defaults to new lines is the value set as the default in the Purchasing
Options window. If you enter a system item, the type set on the items definition will override
the original defaulting value if necessary.
Item/Revision: Select from the list of values if ordering an item thats already been defined in
the item master. Once selected, the category, description, UOM and price will populate based
on the item definition. If the system item has been placed under revision control, you must
also select the appropriate revision number being ordered. If ordering items that have not been
defined in the item master, skip the Item/Revision fields and manually enter a category,
description, UOM and price.
Category: A required field populated either from the predefined items definition or manually.
You cannot change the purchasing category if you choose a system item.
Description: For system items, you can update the description only if that functionality has
been enabled for item attribute controlling descriptions. The full item description for the
current line is displayed beneath the Lines tabbed region. You must provide a description for
one-time items.
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Standard Purchase Order Line Items Tabbed Region
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UOM (Unit of Measure): The UOM qualifies the quantity that will next be entered. Suppliers
need to know whether youre ordering 3 each, 3 boxes or 3 pounds. The value initially
populates with the default set up for the line type selected, and is then overridden by the value
set on the item definition.
Quantity: Enter the total quantity to be ordered.
Promise/Need-By Dates: Enter the date that you have requested delivery from the supplier in
the Need-By date field. If you have communicated with the supplier who has committed to a
delivery date, enter it in the Promise field instead. Its important that only supplier-provided
dates be entered in the Promise field, and non supplier-provided dates be entered only in the
Need-By date field. These dates will be used to measure supplier performance related to
delivery issues.
Supplier Item: If available, you can enter the number or name that the item has been assigned
on the suppliers item list. For example, our item master may have assigned a number/name in
Oracle of Pencils, Lead No. 2, but the suppliers number for the item in their system may be
12-7732.
Charge Account: If an item is distributed to a single charge account, the account number is
displayed for viewing purposes only, it cannot be updated directly in this window. If an item is
being distributed to multiple charge accounts, the word Multiple will be displayed, requiring
you to drill down to either the Shipment or Distribution level of the purchase order to see
charge account combinations.
Amount: This is a display field which holds the results of the quantity ordered multiplied by
the price.
Standard Purchase Order Line - Price Reference Tabbed Region

List Price/Market Price: When ordering predefined items, the list price and market price will
default from the items definition if specified. You can either accept the defaults or make
changes. The list price is the price paid with no discounts, while the market price is what the
item is currently selling for in the market.
Price Type: This is a user-defined list of values developed through lookup codes. Commonly
used price types include fixed, variable and cost plus fee.
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Standard Purchase Order Line Price Reference Tabbed Region
Standard Purchase Order Line - Reference Documents Tabbed Region

Contract: You cannot enter a contract number until you have entered a supplier in the header,
and the contract must be for this supplier. The contract you choose must be effective; that is,
the current date has to be within the effective date and the expiration date of the contract. If
you reference a contract purchase agreement on a standard purchase order line, Purchasing
adds the total amount of the purchase order line to the released amount on the contract
purchase agreement. Purchasing lists only those contracts with the same supplier as the one on
your standard purchase order.
Quotation/Line/Quotation Type/Supplier Quotation: These fields are display only and will
be populated if you selected a quotation from the Supplier Item Catalog. These fields will also
be populated if you have created sourcing rules and either associated a catalog with an
approved supplier list (PO: Automatic Document Sourcing = No) or have active, unexpired
quotations in the system (PO: Automatic Document Sourcing = Yes). This catalog will be
discussed later in this module.
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Standard Purchase Order Line Reference Documents Tabbed

Region
Standard Purchase Order Line - More Tabbed Region

Note to Supplier: Enter up to 240 characters of special information that needs to be
communicated to the supplier. Notes at this level are specific to the particular line entered as
opposed to notes to suppliers entered at the header level that pertain to all lines on the purchase
order. If 240 characters are not sufficient, use the Attachments feature to add a text attachment
that will print on the purchase order.
UN Number/Hazard: If applicable, enter the UN identification number for the item. Any
default, if present, comes from the item definition. If youve entered a UN Number, the
corresponding hazard class is displayed. Otherwise, you can enter a hazard class for this item.
Capital Expense: Indicates that the purchase is a capital expenditure that will be later
integrated with Assets or some other asset system.
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Standard Purchase Order Line More Tabbed Region
Standard Purchase Order Line - Temporary Labor Tabbed Region

If your organization has licensed and implemented Oracle Services Procurement, an additional
tab for Temporary Labor appears in the Line region of the Purchase Order window. This region
enables the entry of information related to the contractor that will be providing services.
First Name & Last Name: Enter the contractors name.
Start Date & End Date: Enter the starting date and ending date that the contractor is going to
be working.
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Standard Purchase Order Line Temporary Labor Tabbed Region
Entering Standard Purchase Order Shipments - Tabbed Regions

The Shipment section of the purchase order contains detail regarding quantities of items to be
shipped by specified ship dates and to specified ship locations. When you save your work,
Purchasing creates distributions if sufficient, valid, default information is available and if there
are no existing distributions.
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Entering Standard Purchase Order Shipments - Tabbed Regions
Standard Purchase Order Shipment - Shipments Tabbed Region

Org: If you entered a system item, you can pick only inventory organizations in which the item
is defined. If you entered a revision number on the purchase order line, then the item revision
must also be defined in the inventory organization. If you did not enter an item, then you can
select from a list of values of inventory organizations.
Ship-To: You can pick any location that is not tied to a specific inventory organization or any
location whose associated organization matches the organization in the previous field.
UOM/Quantity: The first shipment line for any item will have the full quantity and UOM
defaulting from the Items tabbed region previously discussed. If you decrease this quantity,
Purchasing will automatically default the remaining quantity ordered that has not yet been
placed on the shipment line on the next shipment line you create. The total quantity of
scheduled shipments for a particular line must sum to the quantity in the Items tabbed region.
Note that Quantity becomes Amount for Oracle Procurement Services lines.
Need-By: Enter a Need-By date. This field is optional unless the item is a planned item. This
field is used in several reports that relate to analyzing supplier performance.
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Standard Purchase Order Shipment Shipments Tabbed Region
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Promised Date/Original Promise: Enter the date that the supplier promised delivery of the
items. If you are subsequently contacted by the Supplier with a different date, you will simply
overwrite the previous promise date with the new promise date. When this is done, Purchasing
shifts the original promised date into the Original Promise field so that supplier performance
can be measured against these dates. If the supplier again extends the delivery date promised,
you can again overwrite the promise date with the new promise date. The system will continue
to maintain the promise date initially provided in the original promise date field. Supplier
performance can then be measured for the time between the original promise date and the
current promise date. Suppliers can themselves update their promised delivery date through
the iSupplier Portal.
Charge Account: If a shipment is purchased from a single charge account, the account number
is displayed for viewing purposes only, it cannot be updated directly in this window. If an item
is being purchased from multiple charge accounts, the word Multiple will be displayed,
requiring you to drill down to the Distribution level of the purchase order to see account
numbers.
Amount: This is a display field which holds the results of the quantity ordered multiplied by
the price.
Country of Origin (not shown above): The Country of Origin is the country in which an item
is manufactured and is used to track goods for reporting purposes (Movement Statistics).
Taxable and Tax Code (not shown above): Select Taxable and you are required to enter a
Tax Code. Enter or use the default Tax Code for taxable items. The defaults for Tax Codes
come from the Preferences and Purchasing Options windows. See the Tax Defaults in
Purchasing topic in the Oracle Purchasing Users Guide.
Standard Purchase Order Shipment - More Tabbed Region

Receipt Close Tolerance (%): Purchasing automatically closes a shipment for receiving if it is
within the receipt closing tolerance at the receiving close point. Set the receiving close point in
the Purchasing Options window.
Invoice Close Tolerance (%): Purchasing automatically closes a shipment for invoicing if it is
within the invoice closing tolerance at billing, when Payables matches invoices to purchase
orders or receipts.
Invoice Matching: Select which information will be compared to the invoice when matching.
All must match within tolerance for the selected option.
Two-Way: Purchase order and invoice quantities as well as purchase order and invoice
unit prices must match within tolerance before the corresponding invoice can be paid. The
receipt close tolerance can be set to 0% to allow the system to automatically close fully
received lines.
Three-Way: Purchase order, receipt, and invoice quantities as well as purchase order and
invoice unit process must match within tolerance before the corresponding invoice can be
paid.
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Standard Purchase Order Shipment More Tabbed Region
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Four-Way: Purchase order, receipt, accepted, and invoice quantities as well as purchase
order and invoice unit prices must match within tolerance before the corresponding
invoice can be paid.
Accrue on Receipt: Check box to indicate that the items on this purchase order line should be
accrued on receipt. Inventory destined items always accrue upon receipt. For expense items, if
the Accrue Expense Items flag in the Purchasing Options window is set to Period End, the
items cannot accrue upon receipt, and you cannot change the shipment level default. If the
Accrue Expense Items flag is set to At Receipt, the default is to accrue upon receipt, but you
can change it to Period End.
Firm: A setting used with MRP to indicate to that module that it cannot change or suggest
changes to the details of this purchase order based on changed demand that has occurred since
the order was originally created.
VMI (not shown above): Vendor Managed Inventory (VMI) refers to a business arrangement
in which the buyer delegates replenishing and planning activity for an item to the supplier. If
the line item is under VMI control this flag will be checked. For more information about VMI,
see the Oracle Inventory Consigned Inventory from Supplier Process Guide.
Consigned (not shown above): Consigned inventory refers to a type of inventory practice
where you receive and maintain goods belonging to one of your suppliers. If the line item is a
consigned item, this flag will be checked. For more information about consigned inventory, see
the Oracle Inventory Consigned Inventory from Supplier Process Guide.
Standard Purchase Order Shipment - Status Tabbed Region

Status: This status will be updated by the system based on actions taken by buyers, receivers
or accounts payable staff.
Ordered/Received/Canceled/Billed: Quantities will be displayed to indicate the quantities
that have been ordered, received, cancelled and billed. Quantities are updated through actions
taken by buyers, receivers and accounts payables staff.
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Standard Purchase Order Shipment Status Tabbed Region
Standard Purchase Order Shipment - Receiving Controls Button

Use the Receiving Controls window to enter receiving control information for purchase orders
and releases. Note that controls you enter here apply to specific purchase orders/releases and
override the receiving controls you enter in the Receiving Options window.
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Standard Purchase Order Shipment Receiving Controls Button
Entering Standard Purchase Order Distributions - Tabbed Regions

Use the purchase order Distributions window to enter distribution information for purchase
order shipments and to view distributions that Purchasing has automatically created for you.
You can enter multiple distributions per shipment line. You can also view on-line requisitions
included on the purchase order enter paper requisition information in this window.
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Entering Standard Purchase Order Distributions - Tabbed

Regions
Standard Purchase Order Distribution - Destination Tabbed Region

Type: The destination type determines the final destination of the purchased items. Choose
one of the following options:
Expense - The goods are delivered to the requestor at an expense location. The destination
subinventory is not applicable.
Inventory - The goods are received into inventory upon delivery. You can choose this
option only if the item is stock enabled in the ship-to organization.
Shop Floor - The goods are delivered to an outside processing operation defined by Work
in Process. You can choose this option only for outside processing items.
Requestor: Enter the name of the person requesting the goods or services. If the purchase
order was automatically created from approved requisition lines, this field would be populated
with the name of the requestor on the requisition.
Deliver-To/Subinventory: Enter the Deliver To location for this distribution. If the destination
type is Inventory, you can also enter the Subinventory.
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Standard Purchase Order Distribution Destination Tabbed Region
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Quantity: Enter the Quantity of the purchase order shipment that you want to charge to the
Accounting Flexfield. The default value comes from the quantity you enter in the Shipments
window. If you decrease the default quantity, Purchasing automatically defaults on the next
distribution line the remaining quantity you have not yet assigned to a distribution line.
Charge, Accrual, and Variance Accounts: Enter the Charge Account. When you save your
changes in this window, Purchasing uses the Account Generator to automatically create the
following three accounts for each distribution:
Charge - The account to charge for the cost of this item
Accrual - The AP accrual account
Variance - The invoice price variance account
If the receiving destination operating unit is different from the purchasing operating unit, you
also need to specify destination Charge and Variance accounts.
Recovery Rate (not shown above): The recovery rate is the percentage of tax that your
business can reclaim for credit. The recovery rate defaults in based on the Tax Code in the
purchase order Shipments window and the setup in the Financials Options window.
Standard Purchase Order Distribution - More Tabbed Region

Requisition Number/Line and Online: The Online check box indicates whether this
distribution is part of an online requisition. If so, Purchasing checks the box and displays the
online requisition number and line number, you cannot update this field. If this distribution
does not come from an online requisition, enter the paper requisition number in this field. The
default is the paper requisition number from the Purchase Order Preferences window, if
entered.
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Standard Purchase Order Distribution More Tabbed Region
Standard Purchase Order Distribution - Project Tabbed Region

Project/Task/Expenditure Type/Expenditure Org: If this purchase is being charged to a
Project, enter the appropriate project, task, expenditure type, expenditure org and expenditure
item date.
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Standard Purchase Order Distribution Project Tabbed Region
Supplier Document Attachments

You can include as Email attachments to your supplier:
PDF documents with attachments
Text attachments, notes, files and URLs
Attachments compressed as .zip Files
You can also send failure notifications to both the supplier and buyer.
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Supplier Document Attachments
Approve Standard Purchase Order

Approval is the last step in creating a Purchase Order.
Integration with Workflow
In Purchasing, all approvals are handled by Workflow. The Procurement Workflows are
predefined workflows embedded in Purchasing. Workflow uses the approval controls and
hierarchies you define during setup as the default approval processes.
Status
Your purchase order document will have the status Incomplete until you submit the document
for approval. If you do not have sufficient approval authority, the status will be set to In
Process and Workflow will forward the document to an appropriate approver. Once approval
is obtained, the status is changed to Approved.
Communicating Approved Purchase Orders to Suppliers
Depending on how the suppliers record has been defined, purchase orders may be sent by
printed document, facsimile, email, XML (eXtensible Markup Language) or through electronic
data interchange (EDI). If you select Print, the purchase order is printed immediately on your
session printer. The Approve Document window defaults the transmission method defined for
the supplier, but you can change some of these defaults for a particular purchase order. Setup
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Approve Standard Purchase Order
of these document delivery options is discussed in the Understand setup options section of this
(Purchase Orders) course module.
Note: You cannot select Print, Fax, or E-Mail if the document is to be sent by XML or EDI.
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Agenda
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When to Use a Blanket Purchase Agreement

Blanket purchase agreements and releases allow you to negotiate stable, long-term contracts
while maintaining flexible delivery schedules and order quantity commitments. You create
blanket purchase agreements when you know the details of the goods or services you plan to
buy from a specific supplier, but you do not yet know delivery schedule details. You can use
blanket purchase agreements to specify negotiated prices for your items before actually
purchasing them.
A blanket purchase agreement is a type of purchase order you issue before you request actual
delivery of goods or services. You normally create a blanket purchase agreement to document
a long-term supplier agreement.
A blanket release is an actual order of goods or services you issue against a blanket purchase
agreement. The blanket purchase agreement determines the characteristics and the prices of
the items. The release can be created manually or automatically.
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When to Use a Blanket Purchase Agreement
Blanket Releases
Once you have an approved blanket agreement you need only create a release to authorize
delivery of goods or services. You can create blanket purchase agreement releases using the
following methods:
The Releases window
PO Create Documents workflow
AutoCreate window
The Create Releases process
Manually Created Releases
You can manually enter releases against active blanket purchase agreements. You can set up
purchasing to warn you if a blanket purchase agreement exists for items that you try to
requisition. Because the blanket purchase agreement is in place, you can create a blanket
release instead of submitting a requisition. If you choose not to enable to warn if a blanket
purchase agreement exists, can submit requisitions and the buyer can create the blanket release.
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Blanket Releases
Automatically Created Releases

Buyers can expedite creation of releases using the AutoCreate window or by submitting the
Create Releases program. In addition, the PO Create Documents workflow can be set up to
automatically create blanket purchase agreement releases for requisitions that are submitted,
regardless of whether their origin is the Requisitions window or Oracle iProcurement.
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Blanket Purchase Agreements - Additional Information Entered

Focus of discussion - Rather than reiterate the many fields that have already been discussed
during the creation of a standard purchase order, this section will highlight the differences
between the blanket purchase agreement and the standard purchase order. Your instructor will
review the previously discussed fields as needed during the demonstration of creating a blanket
purchase agreement.
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Blanket Purchase Agreements Additional Information Entered
Blanket Purchase Agreements: Additional Information - Header

Amount Agreed: When creating a blanket purchase agreement, you can indicate the dollar
amount of the agreement.
Released: The dollar value displayed in this field is the total dollar value of all releases issued
against the blanket purchase agreement.
Global: Select the Global checkbox only if you are creating a global agreement. Global
agreements will be discussed later in this module.
Terms and Conditions
You can access the Agreement Controls area of the Terms button. The effective start and stop
dates for the agreement can be entered. Releases can only be created during these dates when
the blanket is effective.
Amount Limit: You can optionally change the defaulted value for the Amount Limit. Initially
this value is equal to the Amount Agreed. You may provide a higher value in the Amount
Limit field which will allow the total released amount to exceed the Amount Agreed. If the
total amount released exceeds the Amount Limit, the release cannot be approved.
Minimum Release: You can also specify a Minimum Release dollar value which will require
that the dollar amount for individual releases exceeds the Minimum Release amount set. Often
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Blanket Purchase Agreements Additional Information - Header
you establish the Minimum Release amount based on your estimated costs of processing
individual releases. For example, if the estimated cost of processing releases is $25, then the
user may set the Minimum Release amount to $25.
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Blanket Purchase Agreements: Additional Information - Lines

Items Tabbed Region
Notice that the Quantity field has been grayed out. By definition of a blanket purchase
agreement, you are uncertain of the quantities that will be needed of each item listed. The
price that is entered for each item is for an implied quantity of one. Reduced pricing that may
be available when purchasing larger quantities will be entered through the Price Breaks button
that will be discussed shortly.
Price Reference Tabbed Region
The Allow Price Override check box is used for blanket purchase agreements and planned
purchase orders only. This check box indicates that the release price can be different from the
price on the purchase agreement or purchase order line. If you allow price override, enter the
dollar amount of the Price Limit. This is the maximum price per item you allow for the item
on this agreement line. If you do not allow a price override, Oracle Purchasing displays on the
release the shipment price from the purchase agreement and prevents you from updating it.
Select Negotiated to indicate that the purchase price is negotiated. If the actual price is greater
than or equal to the list price, then the field is unchecked by default. If the actual price is less
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than the list price, then the field is checked as the default. You can accept the default value or
change it.
Reference Documents Tabbed Region
This tabbed region is generally not used on blanket purchase agreements unless the blanket
was created by copying a quotation. Copying purchasing documents will be discussed later in
this module.
More Tabbed Region
The information entered here is the same as for a standard purchase order.
Agreement Tabbed Region
You can establish controls at the line level if desired. Additional controls such as minimum
release amount, quantity agreed and amount agreed can be established for individual purchase
agreement lines. Whether or not you have agreed to minimum quantities or amounts, the
system will automatically keep track on this tabbed region of the quantities and amounts
actually released against the blanket. Internal quantity and amount targets not formally
negotiated as agreed to quantities or amounts with the supplier should not be entered in the
agreement. Entry of internal targets could be interpreted and enforced as legal binding to the
user.
The Cumulative Pricing check box will be enabled by default depending on a setup option in
the Purchasing Options of the default value hierarchy. The default may be changed depending
on the actual pricing negotiated with the supplier.
Blanket Purchase Agreements: Additional Information - Price Breaks

After entering the Purchase Orders window and choosing a Type of Blanket Purchase
Agreement, the button normally titled Shipments changes to Price Breaks. This form
adjustment is necessary to support reduced pricing agreements for volume purchases.
Quantity: This quantity is not an ordered quantity, but simply a quantity that if purchased
would result in reduced pricing. The quantity indicated may need to be reached on an
individual release (when the Cumulative Pricing check box on the Agreement tabbed region
previously discussed is unchecked) or may be able to be reached through an accumulation of
releases issued against the blanket purchase agreement line (Cumulative Pricing check box is
checked).
Effective Dates: Enter the date range that this price remains in effect.
Break Price: Enter the reduced price that will be paid for each quantity listed.
Discount (%): If a Break Price is entered, the Discount (%) field will display the percentage
that this price is off the price listed on the Items tabbed region for the purchase of an implied
quantity of one.
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Blanket Purchase Agreements Additional Information - Price

Breaks
Note: Oracle Purchasing is integrated with Oracle Advanced Pricing to allow you to model
complex pricing rules for items listed on Global Blanket Agreements. Requisitions and orders
sourced to these agreements can now leverage dynamic pricing formulas and/or modifiers
defined in Oracle Advanced Pricing, in addition to the agreement line price and price breaks.
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Notification Controls
Use the Notification Controls window to enter notification controls for planned purchase
orders, contract purchase agreements, and blanket purchase agreements. For these documents,
you can establish expiration and release control notification conditions and specify the number
of days before the condition is met that you want to be notified. When the notification
conditions are met, Oracle Purchasing sends you an alert, using Alert (or e-mail).
Amount Not Released: This control notifies you when the total planned amount released to
date is less than a preset amount or is less than the Amount Agreed on the blanket purchase
agreement header multiplied by a preset percentage. For example, a user can enter an Effective
To date for the Amount Not Released notification control of June 30. The user could further
indicate a percentage of 50% (which the system will further calculate the dollar amount of
$2.5M for this percentage and display it in the Amount field). The user would then be notified
if on June 30, the total amount of releases did not exceed $2.5M. Rather than indicating a
percentage, the user can provide a dollar amount and the system will calculate the percentage.
Additionally, specified percentages may be set based on prior spending trends rather than
passage of time as appears to be the case in the example provided. You may also wish to
establish multiple Amount Not Released notification controls throughout the period of the
agreement.
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Notification Controls
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Amount Released: This control notifies you when the total planned amount released to date is
more than a preset amount or is less than the Amount Agreed on the blanket purchase
agreement header multiplied by a preset percentage. For example, a user can enter Effective
From/To dates for the Amount Released notification control of January 1 to March 31.
Assume the user entered $2M as the amount (which the system will further calculate the
percentage of 40% by relating the $2M to the $5M Amount Agreed). The user would then be
notified if and when between January 1 and March 31, the total amount of releases exceeds the
$2M. Similar to the discussion for the Amount Not Released, you may instead specify a
percentage, set the amount based on prior spending trends rather than the passage of time, and
may also establish multiple Amount Released notification controls throughout the period of the
agreement.
Expiration: This control notifies you that the agreement is approaching expiration. The
notification is sent at specified dates prior to the effective end date of the agreement. For
example, the Warning Delay could be set at 90 for an agreement with a one year length. The
system will then send a notification to the Buyer 90 days prior to the expiration of the one year
agreement that the expiration is approaching. You often will set multiple Expiration
notification controls to ensure that sufficient progress is being made toward negotiation of a
new agreement with this supplier or a new supplier(s). This control is especially effective for
items that should never be purchased outside of agreements.
Approve Blanket Purchase Agreement

Similar to standard purchase orders, blanket purchase agreements need to be approved. Once
approved, blanket releases can then be issued against the blanket purchase agreement.
Note: You can create sourcing rules from this blanket purchase agreement automatically. This
is discussed in the Approved Supplier Lists and Sourcing Rules course topic.
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Blanket Purchase Agreement and Blanket Releases

Once a blanket purchase agreement has been approved, you can begin creating blanket releases
against the agreement. Suppliers will be provided the additional information, such as
quantities and shipping details, needed to make actual delivery of the items on the agreement.
Details regarding releases are covered in the next few pages. Once you have provided
complete shipment and distribution detail, the release needs to be approved before it is sent to
the supplier. The approval process for releases is the same as the approval process for the
blanket purchase agreement.
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Blanket Purchase Agreement and Blanket Releases
Blanket Releases Structure - Header

When creating a new release, you will enter the blanket purchase agreement number. A list of
values is available to assist you in selecting the appropriate agreement. Once selected, the next
available release number will be assigned and the supplier, site and buyer from the agreement
will be displayed. You can override the default as long as the Enforce Buyer Name option is
not enabled in the Purchasing Options window.
The status will be updated based on actions taken in the system. A total amount for the release
will be displayed as items are ordered in the Shipments window. You can further indicate to
MRP whether this release is firm or can be changed and whether acceptance is requested of the
supplier to acknowledge that they received the release.
Receiving Controls Button
Use the Receiving Controls window to enter receiving control information for purchase orders
and releases. Note that controls you enter here apply to specific purchase orders/releases and
override the receiving controls you enter in the Receiving Options window.
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Blanket Releases Structure - Header
Agreement Button
You can access basic information regarding the blanket purchase agreement through the
Agreement button. For example, you will see amount agreed, buyer, amount released, status,
effective dates and various payment terms from the blanket purchase agreement.
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Blanket Releases Structure - Shipments and Distributions

Like the standard purchase order, releases have shipments and distributions.
Shipments Window
Entry into this tabbed region is exactly like entry of shipments information on the shipments
tabbed region of the standard purchase order with one exception. When you enter the Line
field, you are simply entering the line number for the item you want to order from the blanket
purchase agreement. Unless a user knows what the line number is, you should access the list
of values which will provide the item name and description in addition to the line number.
Once the line number is selected, the associated item name and description are displayed near
the bottom of the window.
More, Status and Item Tabbed Region: Entry into these tabbed regions is exactly like entry
of shipments information on the the same tabbed regions of the standard purchase order.
Distributions Window
Entry into all tabbed regions of the distributions window is exactly like entry of distributions
information on the the same tabbed regions of the standard purchase order.
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Blanket Releases Structure Shipments and Distributions
Center-Led Procurement
The business concept behind Center-Led procurement is to enable agreements with suppliers
for enterprise-wide pricing. It is accomplished through the use of global blanket agreements
and global contract agreements. These global agreements are referenced by another business
units requisition and could be paid for by a third business unit. Final accounting charges to a
requesting business unit can be accomplished through intercompany invoicing.
Out of the box Oracle Purchasing works in a decentralized procurement model where all
business units are expected to perform all aspects of the procure to pay cycle. This slide depicts
a central sourcing with local execution model. You can also set up a complete shared services
or a transfer to local business unit model. For setup details, see the Oracle Purchasing Users
Guide.
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Center-Led Procurement
Creating Global Blanket Agreements

Global agreements are negotiated for enterprise-wide pricing. The global agreement can be
assigned to the organizations which are allowed to use them using Enable Organizations in the
Tools menu. The organizations available to enable in this window are determined by the
supplier sites for the agreements assigned supplier.
Using Global Agreements
Enabled organizations within the enterprise then reference the global agreement and create
standard purchase orders to take advantage of the pre-negotiated prices and terms. The most
typical use would be for the requisitioner or buyer to select items from the Negotiated Sources
portion of the Supplier Item Catalog in Oracle Purchasing.
Note: Global agreements are used by creating a standard purchase order referring to the global
agreement, NOT a release.
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Creating Global Blanket Agreements
Important Setup Considerations

Purchasing supplier sites must be defined for each operating unit required.
Outside processing items cannot be used on a global agreement.
Cumulative pricing cannot be used on a global agreement.
Intercompany transaction flows must be created for intercompany invoicing to take place.
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When to Use a Contract Purchase Agreement

You create contract purchase agreements with your suppliers to agree on specific terms and
conditions without indicating the goods and services that you will be purchasing. A contract
purchase agreement is an agreement between you and a supplier for unspecified goods or
services. This agreement may include terms and conditions, committed amount and an
effective and expiration date. Contract purchase agreements are referenced on standard
purchase order lines. Oracle Purchasing monitors the amount you have spent against contract
purchase agreements.
Focus of Discussion
Rather than reiterate the many fields that have already been discussed during the creation of a
standard purchase order, this section will highlight the differences between the contract
purchase agreement and the standard purchase order. Your instructor will review the
previously discussed fields as needed during the demonstration of creating a contract purchase
agreement.
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When to Use a Contract Purchase Agreement
Contract Purchase Agreements: Additional Information Entered

Header: This agreement may include terms and conditions, committed amount, and effective
and expiration dates.
Amount Agreed: When creating a contract purchase agreement, you can indicate the dollar
amount of the agreement.
Released: The dollar value displayed in this field is the total dollar value of all standard
purchase order lines referencing the contract.
Global: Select the Global checkbox only if you are creating a global agreement. Global
agreements were discussed in the blanket agreement topic.
Terms and Conditions: You can access the Agreement Controls area of the Terms button.
The effective start and stop dates for the contract can be entered. Standard purchase orders can
only reference the contract during its effective dates. Part of the terms and conditions could
include a percentage discount off list prices for all products the supplier sells or different
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Contract Purchase Agreements Additional Information Entered
discounts for different groups of products. For example, maybe theyll give you a 10%
discount on equipment and a 20% discount on office supplies. You can optionally change the
defaulted value for the Amount Limit. Initially this value is equal to the Amount Agreed. You
may provide a higher value in the Amount Limit field which will allow the released amount to
total in excess of the Amount Agreed, but not higher than the Amount Limit. Compliance with
agreed upon terms and conditions will be monitored after purchases are made to ensure things
like item pricing or delivery times are in agreement with any discounts stated in the contract.
Line, Shipment and Distribution Windows: Although these windows appear as part of the
Purchase Order form, you cannot enter these details on a contract purchase agreement. These
details will be provided once the contract is approved as standard purchase orders are issued
with reference to the contract.
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Standard Purchase Order Line - Reference Documents Tabbed Region

Contract: You cannot enter a contract number until you have entered a supplier in the header,
and the contract must be for this supplier. The contract you choose must be effective; that is,
the current date has to be within the effective date and the expiration date of the contract. If
you reference a contract purchase agreement on a standard purchase order line, Purchasing
adds the total amount of the purchase order line to the total amount of the contract purchase
agreement after the purchase order is approved. Oracle Purchasing lists only those contracts
with the same supplier as the one on your standard purchase order.
Automating Purchase Order Generation
Automatic generation of standard purchase orders referencing contract purchase agreements
can be done using the PO Create Documents workflow. For more information see the
Automatic Document Creation course module or refer to the Workflow for Creating Purchase
Orders and Releases topic in the Oracle Purchasing Users Guide.
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Standard Purchase Order Line Reference Documents Tabbed

Region
Creating Global Contract Agreements

Global agreements are negotiated for enterprise-wide pricing. The global agreement can be
assigned to the organizations which are allowed to use them using Enable Organizations in the
Tools menu. The organizations available to enable in this window are determined by the
supplier sites for the agreements assigned supplier.
Important Setup Considerations
Purchasing supplier sites must be defined for each operating unit required.
Intercompany transaction flows must be created for intercompany invoicing to take place.
Note that global contract purchase agreements are part of the Center-Led Procurement feature
set in Oracle Purchasing which was discussed earlier in this module.
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Creating Global Contract Agreements
Agenda
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When to Use a Planned Purchase Order

You create a planned purchase order when you what to establish a long term agreement with a
single source supplier with a commitment to buy goods or services. Planned purchase orders
include tentative delivery schedules and accounting distributions. You then create scheduled
releases against the planned purchase order to actually order the goods or services.
A planned purchase order is a type of purchase order you issue before you order actual
delivery of goods and services for specific dates and locations. You normally enter a
planned purchase order to specify goods you want to order and tentatively schedule
delivery of the goods. You later enter a shipment release against the planned purchase
order when you actually want to order the goods.
A scheduled release is issued against a planned purchase order to place the actual order.
You can also change the accounting distributions on each release and the system will
reverse the encumbrance for the planned purchase order and create a new encumbrance
for the release.
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When to Use a Planned Purchase Order
Planned and standard purchase orders are the same in overall document content with two
exceptions.
You cannot associate a contract with a planned purchase order line.
You can specify agreement controls for planned purchase orders.
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Components of a Planned Purchase Order
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Planned Purchase Order Information Entered

Most of the fields that have already been discussed during the creation of other types of
purchase orders apply to the planned purchase order. The primary difference from a standard
purchase order is that a delivery schedule is entered and the actual purchase order is created by
running the Create Releases process.
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Planned Purchase Order Information Entered
Agenda
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Purchase Order Inquiry

You will frequently need to find information from a purchase order. Several options are
available to assist you in this effort.
Use the Purchase Order Summary Windows
(N) Purchase Orders > Purchase Order Summary
You can enter a variety of search criteria to locate records at the header, line, shipment or
distribution levels of the purchase order. Buttons located at the bottom of the form allow you
to view more or less detail than the level at which you initially searched. For example, assume
you initially searched for shipment lines. From there you can move higher on the purchase
order to view items or you can drill down to view distributions. Optionally, you can create a
custom user layout of this form using Oracles folder technology. Custom layouts can be
defined as the default folder and can be shared with others. See the Oracle Applications Users
Guide for more detail about folder technology.
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Purchase Order Inquiry
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Use the Tools Menu to View Associated Records

From the purchase order lines, you can view associated requisitions, receipts, and invoices.
Some of the associated documents can only be viewed when query results are at a particular
level of the purchase order. For example, you cannot view associated requisitions when
viewing purchase order query results at the header level. Additionally, you can view a history
of activities performed on each document. This functionality is available through the Tools
menu, View Action History option on many windows. Activities will be listed in
chronological order with the most recent activity appearing first.
Use the Purchase Order Window
You can look for purchase order information using either query or find functionality.
Note: The Professional Buyers Work Center, described in a later topic in this course, also
contains features to help you perform inquiries.
Modifying Purchase Orders

Once the desired purchase order is brought to the current record using the various methods
previously discussed for locating documents, you can make necessary changes to the
document. For example, you may adjust quantities, shipping addresses, need-by dates,
distributions, etc.
Affect of Changes on Approval
Most changes cause the documents status to be updated to Requires Reapproval. Once the
document has been reviewed by someone with approval authority, they will either approve or
reject the document. Generally, all changes affecting the suppliers ability to accurately fill the
order will require reapproval. Controlled changes unapprove either the document header alone
or both the header and its shipments. However, you can continue to receive against approved
shipments even when the header is unapproved.
Revision Numbering of Purchase Orders
Depending on the type of modification made to a purchase order, Oracle Purchasing may
increment the revision number on the document.
Note: Additional information regarding methods of modifying Purchase Orders is described in
the Professional Buyers Work Center topic featured later in this course.
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Modifying Purchase Orders
Printing Purchase Orders

Purchase orders can be printed on demand or through a scheduled print process. Purchase
orders sent to suppliers need to be approved. Various criteria are available as parameters on
the Printed Purchase Order report to selectively print certain purchase orders. For example,
you could print only new purchase orders or only changed purchase orders or both. You could
print a single purchase order or a range of purchase orders and also have the option of printing
in test mode if needed.
Implementers will frequently reformat the output of the Printed Purchase Order Report
delivered with the system. Typical changes made include adding company logos, background
design or borders and outlines. Methods of purchasing document delivery will be discussed
later in the Understand setup options topic.
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Printing Purchase Orders
Creating Purchase Order Revisions

Purchase order revisions are created through archiving which is the process of recording all
historical versions of approved purchase orders. Oracle Purchasing automatically archives a
purchase order when you approve it for the first time. Oracle Purchasing subsequently archives
your purchase orders either during the reapproval process or as a result of printing. You can
create multiple revisions of your purchasing documents (standard purchase orders, planned
purchase orders, blanket purchase agreements and contract purchase agreements).
All revisions begin at 0, and Oracle Purchasing increments this revision number by 1 when you
make changes to controlled information and the current revision number is equal to the
archived number. Oracle Purchasing prints the most current revision to send to the supplier.
As a result, the first revision that you print might not be 0 if you are archiving on approval.
If youre sending purchase orders through EDI, then archiving must be set to approval rather
than printing.
Use the Document Types window to set whether each of these documents is archived upon
approval or upon printing. This window is discussed in more detail in the Document Security,
Routing and Approval course module.
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Creating Purchase Order Revisions
Document Publishing
If you have Oracle XML Publisher installed, the Oracle Advanced Procurement Suite allows
you to use layout templates created in Microsoft RTF and Adobe PDF formats. To begin the
process:
1. Create a layout for the purchasing document, using the document editor of your choice.
2. Save the layout in either XSL-FO (Extensible Stylesheet Language Formatting Objects),
RTF (Rich Text Format), or PDF format.
3. Upload the layout to Oracle XML Publisher.
Then, to use the layout:
1. Create a purchasing document. If Oracle Procurement Contracts is enabled, optionally
add contract terms and conditions.
2. Navigate to the request submission form and search for PO Output for Communication.
3. Specify the purchase order number and Purchase Order Layout. If Oracle Procurement
Contracts is enabled, specify the Contract Terms Layout.
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Document Publishing
4. Submit the request.

5. The output of the request will be an Adobe PDF formatted document in the layout
specified at run time.
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Archiving Purchase Orders

At the Time of Approval: When archiving is set to occur at the time of approval, revision
numbers may be generated more frequently. Therefore, revision numbers will generally be
higher on documents when using this option.
At the Time of Printing: When archiving is set to occur at the time of printing, revision
numbers may be generated less frequently. Therefore, revision numbers will generally not be
as high on documents when using this option.
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Archiving Purchase Orders
Purchase Order Statuses - Typical Cycle

Above is an example of a typical cycle for purchase order statuses. The initial status is
Incomplete until submitted for approval. The status is updated to In Process until it is either
Pre-Approved, Approved or Rejected. Once approved, many changes made to purchase
orders result in a status of Requires Reapproval. Once reapproved, the status is again
Approved.
Where to Update Statuses
(N) Purchase Orders > Purchase Order Summary
In Oracle Purchasing, purchase order statuses can be updated either in the Purchase Order
window or in the Purchase Order Summary window. Actions available to effect statuses will
be different dependent on the current document status and where you are updating.
Review of Status Types
Incomplete: Initial status on all new purchase orders.
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Purchase Order Statuses - Typical Cycle
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In Process: Status of the document when its sitting on the desk of the approver identified in
your security, routing and approval setups.
Approved: A user with sufficient authority has reviewed and approved the document.
Rejected: Status of the document when the approver has denied approval.
Requires Reapproval: Status of the document when controlled changes have been made to the
document.
Frozen: You can freeze only at the header and release level. You freeze a purchase order
when you want to prevent any future modifications to the purchase order. When you freeze a
purchase order, you can still receive and pay for goods you already ordered.
On Hold: You can place a purchase order on hold only at the header level. This unapproves
the purchase order while preventing printing, receiving, invoicing, and future approval until
you remove the hold.
Closed: Oracle Purchasing automatically closes shipments for receiving and invoicing based
on controls that you specify in the Purchasing Options window. Once all shipments for a given
line are closed, Oracle Purchasing automatically closes the line. When all lines for a given
header are closed, Purchasing automatically closes the document. Oracle Purchasing does not
include closed shipments in the Open Purchase Order reports.
Closed for Receiving - You can close for receiving at the header, release, line, and
shipment levels. Note that if you close for receiving a purchase order header that is
currently open, Oracle Purchasing sets the status of all purchase order shipments to Closed
for Receiving, but the purchase order lines and header remain open.
Closed for Invoicing - You can close for invoicing at the header, release, line, and
shipment levels. Note that if you close for invoicing a purchase order header that is
currently open, Oracle Purchasing sets the status of all purchase order distributions to
Closed for Invoicing, but the purchase order lines and header remain open. The Close for
Invoicing status does not prevent you from matching an invoice to a purchase order or to a
receipt. You can close and reopen documents and their components for invoicing and
receiving using the Control Document window.
Open: You can reopen documents (at the header, release, line and shipment levels) that have
been previously closed to allow additional actions to be performed.
Canceled: Oracle Purchasing lets you terminate an existing commitment to buy from a
supplier by canceling document headers, lines, shipments, or releases. When you cancel a
purchase order entity, you are unable to receive or pay for cancelled items and services,
however, you can pay for all previously received orders. Canceled actions are permanent and
can not be reversed. If you are using online requisitions, Oracle Purchasing returns unfilled
requisitions associated with cancelled purchase order entities to the requisition pool based on
the Cancel Requisitions control you specify in the Purchasing Options window.
Finally Closed: Prevent modifications to or actions against completed documents, lines, and
shipments by final closing them. Final-closed documents are not accessible in the
corresponding entry forms, and you cannot perform the following actions against final-closed
entities: receive, transfer, inspect, deliver, correct receipt quantities, invoice, return to supplier,
or return to receiving. You can approve documents that include final-closed entities, but you
cannot approve documents that are final closed at the header level. Final closing documents is
an internal control action that has no bearing on your contractual relationship with the supplier.
You cannot undo a final-close action.
Note: Only documents that have never been approved can be deleted. Optionally, you can
delete unapproved lines, unapproved shipments and unapproved distributions added to
previously approved documents. Deleted records cannot be viewed once the action is saved. If
you are using automatic numbering, you cannot reuse document numbers that you delete with
this option. If you use online requisitions, Oracle Purchasing returns all requisitions associated
with your delete action to the requisition pool. You can reassign these unfilled requisitions to
other purchase orders or releases.
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Entering Purchase Orders Acceptances

(N) Purchase Orders > Purchase Orders (M) Tools > Acceptances
(N) Purchase Orders > Purchase Order Summary (M) Tools > Acceptances
When you select the Acceptance Required check box in the terms and conditions of purchasing
documents, you require your supplier to formally accept your purchase agreement offer. By
choosing Acceptances from the Tools menu from the Purchase Order and Releases window or
the Purchase Order Summary window, you can access the window to enter acceptances.
Suppliers can enter their own acceptances using Oracle iSupplier Portal
Action: Enter the results of your supplier follow-up. This a free-form field with no list of
values. You can easily record the type of follow-up you performed such as Follow-up
telephone call, Follow-up letter, or Fax follow-up. You can also use this field to record the
outcome of the follow-up such as Will call back, No answer, Schedule slippage, or Cannot
fulfill order.
Action Date: Enter the date the action occurred on. The default is todays date, but you can
override to another date.
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Entering Purchase Order Acceptances
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Accepted By: Enter the person who performed the action. Your name is the default, but you
can change to any other name from the employee list of values displayed.
Accepted: Check this box to indicate that the supplier accepted the purchase order.
Acceptance Type: Select the acceptance type from the seeded options below:
Accepted All Terms - The supplier accepted all the terms of the purchase order.
On Schedule - The supplier agreed to meet the delivery dates on the purchase order.
Unacceptable Changes - The supplier made modifications to the terms of the purchase
order that you do not find acceptable.
Note: You can define additional acceptance types through the Purchasing Lookup Codes.
eSignatures: Oracle Procurement Contracts enables you and your supplier to verify signatures
electronically. This information can be view from the Acceptances window or from Oracle
iSupplier Portal.
Workflow Notifications
The workflow PO Send Notifications for Purchasing Documents notifies you of various
situations that have occurred with your purchasing documents. Among the situations for which
youll be notified include documents with statuses of incomplete, rejected, or requires
reapproval. This workflow will also notify you when the date supplier acceptances were
requested has passed without acknowledgement of their acceptance. You can view and
respond to these notifications through the Notifications Summary window. This workflow
process is initiated by submitting the Send Notifications for Purchasing Documents process.
You will normally schedule that process to run on at least a daily basis.
Opening a Document
From a notification that you have opened, you can also drill down to the document. Depending
on the function security assigned to your responsibility, you have varying levels of access to
information. After you modify a document opened through the notification, you must return to
the notification and choose Approve there, not in the document itself, so that Purchasing can
record your approval action and continue with or complete the approval process. Depending
on the notification message, recipients will be able to take actions such as approve, reassign,
forward, reject, ignore, or close.
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Workflow Notifications
Copying Purchase Orders

You can copy purchase orders of any status. Above is a list of the documents that can be
copied from and to. This feature is particularly helpful if, for example, you want to renew a
blanket purchase agreement that contains hundreds of lines. Rather than manually entering the
same lines again into a new document, you can copy the previous agreement to a new
agreement and change the effectivity dates.
How to copy documents:
1. Query the document you want to copy from the Purchase Orders, Purchase Order
Summary, or Quotations windows.
2. Choose Copy Document from the Tools menu.
3. Select an eligible To Document Type.
4. Select other options if needed:
- Document Number: Enter a document number only if you use manual numbering.
- Copy Attachments: Check this box to copy an attachment from any level of the
document.
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Copying Purchase Orders
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Purchasing creates and displays the new document. The document is an exact copy of the
original except for the Promised and Need-By dates; if these dates are past dates, they change
to todays date on the new document. Effectivity dates, if any, do not change. Modify the
document if needed. Save and approve the document.
If information in the document you have just copied is invalid or outdate: For example, if
a supplier or account is inactive or invalid, a message window appears after you choose
Approve. Use this window to help you identify and correct invalid or outdated fields in the
new document you are creating. You cannot approve the document until you update these
fields appropriately. You cannot use the Copy Documents window to modify documents by
copying from one document to another with the same document number.
See the Copy Purchase Orders topic in the Oracle Purchasing Users Guide for a complete
list of documents.
Agenda
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Purchase Document Interfaces
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Purchasing Documents Open Interface

Load (1)
The Purchasing Documents Open Interface receives price/sales catalog information and
responses to requests for quotation (RFQs) electronically from suppliers in the form of blanket
purchase agreement lines or catalog quotations. One way to import catalog data into the
Purchasing Documents Open Interface, and finally into Oracle Purchasing, is through Oracle eCommerce Gateway.
You can also import standard purchase orders through the Purchasing Documents Open
Interface. This requires that you load the interface tables using a program that you create. The
tables to be loaded are; PO_HEADERS_INTERFACE, PO_LINES_INTERFACE, and
PO_DISTRIBUTIONS_INTERFACE. For details see the Oracle Manufacturing APIs and
Open Interfaces Manual.
Process (2)
Run the Purchasing Documents Open Interface program to validate and import it into Oracle
Purchasing. The Purchasing Documents Open Interface program can be run from within
Oracle e-Commerce Gateway when you choose Import Program from the e-Commerce
Gateway Process menu.
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Or you can run this program separately, from within Oracle Purchasing. If you run it from
within Oracle Purchasing, you need to first import the price/sales catalog information into the
interface tables, using Oracle e-Commerce Gateway or a custom import program. Then use
this process to import the information into Oracle Purchasing.
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For details see the Oracle Manufacturing APIs and Open Interfaces Manual.
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Purchase Document Import Validation
Purchasing Open Interface Tables
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Purchasing APIs
Oracle Purchasing provides public APIs that are available to your programs to use for specific
functions. For complete details and sample code see the Oracle Manufacturing APIs and Open
Interfaces Manual.
Purchasing Order Change API
This API enables you to record supplier acceptance or rejection and update quantity, price, or
promise date on standard purchase orders or releases that exist in Oracle Purchasing. It
performs all the necessary validation before updating the changes. The names of these APIs are
PO_CHANGE_API1_S.record_acceptance and PO_CHANGE_API1_S.update_po.
Cancel Purchase Order API
This API provides the ability to cancel Oracle Purchasing documents directly from your
program. The name of this API is PO_Document_Control_PUB.control_document.
Custom Pricing API
This API provide the ability to perform custom pricing on Oracle Purchasing documents
directly. There are three separate APIs that are used to perform custom pricing: Custom Pricing
Date API, Custom Requisition Pricing API, and Custom PO/Release Pricing API. The Custom
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Purchasing APIs
Pricing Date API is called first to establish a pricing date for the other calls. The names of the
APIs are:
PO_Custom_Price_PUB.get_custom_price_date
PO_Custom_Price_PUB.get_custom_req_price
PO_Custom_Price_PUB.get_custom_po_price
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Agenda
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Purchase Order Reports

Blanket and Planned PO Status Report: Review blanket and planned purchase orders and
related releases.
Canceled Purchase Order Report: Review canceled purchase orders.
Contract Status Report: Review the status of contracts and list purchase orders regarding
each contract.
Open Purchase Orders Report (by Buyer): Review all or specific purchase orders for
specific buyers.
Open Purchase Orders Report (by Cost Center): Review all or specific purchase orders
charged to one or more cost centers.
Printed Change Orders Report (Landscape): Print changed purchase orders in landscape
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Printed Change Orders Report (Portrait): Print changed purchase orders in portrait format.
Printed Purchase Order Report (Landscape): Print purchase orders in landscape format.
Printed Purchase Order Report (Portrait): Print purchase orders in portrait format.
Purchase Agreement Audit Report: Review items purchased on a standard order that could
have been purchased on a blanket.
Purchase Order Commitment by Period Report: Review the monetary value of
commitments for the next six periods for one or all suppliers.
Purchase Order Detail Report: Review details for all or specific standard or planned
purchase orders.
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Purchase Order Distribution Detail Report: Review accounting distributions for purchase
orders.
Purchase Order and Releases Detail Report: Review details (quantity ordered, received,
billed and expected) for blanket purchase agreements, planned purchase orders and associated
releases.
Purchase Summary Report by Category: Review the number of orders placed with
suppliers for a given category.
Purchasing Activity Register:Review purchase order monetary activity for a period of time.
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Agenda
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Important Purchasing Options

(N) > Setup > Organizations > Purchasing Options
Control Tab
Price Tolerance %/Enforce Price Tolerance: This is the percentage by which the
autocreated purchase order line price cannot exceed the requisition line price. If you select
Enforce Price Tolerance, you can create, but not approve, purchase orders for which this
tolerance is exceeded. There is no restriction on how much a price can decrease.
Price Tolerance Amount/Enforce Price Tolerance Amount: This is the dollar amount by
which the autocreated purchase order line price cannot exceed the requisition line price. If you
select Enforce Price Tolerance Amount, you can create, but not approve, purchase orders for
which this tolerance is exceeded. There is no restriction on how much a price can decrease.
Note: If you set both price tolerance percentage and amount values, the system will apply the
more restrictive of the two.
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Important Purchasing Options
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Cancel Requisitions: The Cancel Requisitions options apply only to requisitions from which
purchase orders were autocreated. Select one of the following:
Always - When canceling the purchase order, Oracle Purchasing also cancels the
requisition.
Never - When canceling the purchase order, Oracle Purchasing does not cancel the
requisition, so it is again available for inclusion on a purchase order.
Optional - When canceling the purchase order, you are given the option to cancel the
requisition.
Enforce Buyer Name: Select Enforce Buyer Name to enforce entry of only your name as the
buyer on purchase orders. Otherwise, you can enter the name of any active buyer.
PO Output Format: Select PDF to have purchase orders generated in Adobe PDF format or
Text to have them printed in the standard format.
Default Tabbed Region
Minimum Release Amount: Enter the minimum dollar amount that you want to issue on any
individual release.
Price Break Type: Select the Price Break Type that defaults on blanket purchase orders:
Cumulative - Price breaks apply to the cumulative quantity on all release shipments for the
item.
Non-cumulative - Price breaks apply to quantities on individual release shipments for the
item.
Numbering Tabbed Region: PO Number - Entry/Type/Next Number
Select the Number Entry method for purchase orders:
Automatic - Oracle Purchasing automatically assigns a unique sequential number to each
document when you create the document.
Manual - You provide a document number manually when you enter the document.
You can change the method of entering document numbers at any time. If you originally allow
manual entry and switch to automatic entry, make sure to enter a Next Number that is higher
than the highest number you assigned manually. Select the Number Type you want Oracle
Purchasing to use purchase order numbers: Numeric or Alphanumeric. If you choose Manual
document number entry, you can choose numeric or alphanumeric numbers.
You can change the document number type from Numeric to Alphanumeric whenever you
want. You can change the document number type from Alphanumeric to Numeric only if all
your current document numbers are numeric. Enter a value that you want Oracle Purchasing to
start with when it generates the unique sequential document numbers if you choose Automatic
document number entry.
Profile Options
System Administrator Responsibility
(N) Profiles > System
PO: Price Tolerance (%) for Catalog Updates
A value in this profile option specifies the maximum percentage increase allowed to an items
price when your supplier sends updated price/sales catalog information through the Purchasing
Documents Open Interface. If the tolerance is exceeded, the buyer receives a notification and
can accept or reject the increases in the Exceeded Price Tolerances window.
PO: Archive Catalog on Approval
Indicates whether Oracle Purchasing archives blanket purchase agreements in a price/sales
catalog submission upon approval. You need to consider this profile option only if you receive
price/sales catalog submissions from your suppliers through the Purchasing Documents Open
Interface. This profile option comes into effect only if Archive on Approval is chosen in the
Document Types window in Oracle Purchasing and you import the documents with a status of
Approved.
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Important Profile Options
PO: Change Supplier Site

Indicates whether you can change the supplier site on approved purchase orders.
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PO Communication Profile Options

PO: Secondary E-mail Address
This profile option allows you to send a copy of the e-mail PO to your company. If you wish
to resend the e-mail, you will need to log into this secondary e-mail account and resend it from
there.
PO: In File Path
Enter the absolute path of the directory where the generic terms and conditions file is placed.
PO: Terms and Conditions File Name
Enter the name of the generic terms and condition file that will be printed on your purchase
documents.
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PO Communication Profile Options
Other Setups
Other Setups
(N) > Setup
Several setups are accessed directly through the navigation setup menu. These include
defining buyers, hazard classes and UN numbers.
Buyers
Use the Buyers window to define and maintain your buyers. Buyers can review all requisitions
using the Requisitions window. Only buyers can autocreate purchasing documents. While you
dont have to be a buyer to create a purchase order, only buyers can approve them. Enter the
Name of an employee who you want to define as a buyer. Buyers must be defined as
employees in Oracle Human Resources. Enter the default purchasing Category of the goods
the buyer typically orders. Enter the name of the ship-to location for which the buyer typically
creates purchase orders. Oracle Purchasing defaults this value when you AutoCreate
documents. You can also enter the start and stop dates that the specified employee performs
the buyer responsibility. As the buyer staff changes over time, you can update the buyer names
on purchasing documents using the Mass Update Buyer Name process.
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Hazard Classes
Use this window to define codes for different classes of hazardous materials. You provide the
class name, description, and the date after which the class is no longer active. You can assign a
hazard class to multiple UN numbers to identify hazardous items. Oracle Purchasing
automatically copies hazardous material information onto your documents and prints this
information on your purchase orders, RFQs, and Receipt Travelers. Oracle Purchasing
automatically displays hazardous material information for your receivers.
UN Numbers
Use this window to define United Nations identification numbers for hazardous materials. You
can associate a hazard class with multiple identification numbers. You can also assign an
identification number and a hazard class to each item you define.
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Transaction Delivery Setup
Purchase Orders
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Printed Purchase Orders

(N) > Setup > Organizations > Purchasing Options (T) Control
Standard Text
Text is the standard format for printed purchase orders. Normally you would purchase preprinted forms from an Oracle recommended print vendor with your company information. If
needed, the standard layout can be customized using the Oracle Reports tool. This
customization should be done before ordering the pre-printed forms. Another customized way
of producing a pre-printed form look is to use a design template for your laser printer.
PDF Output
The PDF purchase order can be previewed from the Purchase Order and Purchase Order
Summary windows, from Approval Notifications, and prior revisions from the PO Change
History page. Suppliers can use a link in Oracle iSupplier Portal to view and print the PDF
document. If you have enabled the PDF output; the purchase order is automatically
communicated following approval, can be communicated to the supplier using a Tools menu
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Printed Purchase Orders
option from the Purchase Order Summary window, or sent to a printer by running the PO
Output for Communication process.
The format templates are created using using Oracle XML Publisher. See the Oracle XML
Publisher Users Guide. The template name is then specified in the Oracle Purchasing
Document Types window.
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Purchasing Document Fax Setup Overview

Purchase orders and blanket purchase agreements can be faxed directly to the supplier. Oracle
Purchasing communicates the document to the third party fax server in a format called Fax
Command Language (FCL). The fax server then converts the FCL document into standard fax
signals which are transmitted over a phone line to the suppliers fax machine.
Setup in Oracle Applications
1. Install the third party fax server software (depending on the product this could go on a
standalone PC or the same hardware as the applications server).
2. Create an Oracle Applications printer for the fax server. (See the Oracle System
Administrators Guide.)
Note: Refer to the third party fax server providers installation and administration documents
for details.
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Purchasing Document Fax Setup Overview
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Setup in Oracle Purchasing

1. Set the supplier site Supplier Notification Method to Fax.
2. In the Communication region for the supplier site enter the Fax Area Code and Number.
3. Save your changes to the supplier site.
Refer to the Oracle Payables Users Guide for details.
Use in Oracle Applications
Create your purchasing document and select Approve. While in the Approval window note that
the Fax checkbox is checked and your supplier site fax number has defaulted in. You can
override the fax number or change the method of supplier notification. Once your document
has been approved, workflow will direct your document to the fax server for delivery.
Refer to the Oracle Purchasing Users Guide for details.
Third Party Fax Server Partners
Basically any fax server that can integrate with Oracle Applications and provides FCL support
should work. Since FCL is a proprietary language created by RightFax, then RightFax
Connector for Oracle E-Business Suite would be a logical place to start. Check with the Oracle
Partners division for other providers.
Although using FCL and third party fax servers have the advantage of convenience and the
ability to create custom forms, there are custom solutions using the standard print stream as
well.
Purchasing Document E-Mail Setup Overview

Purchase orders and blanket purchase agreements can be e-mailed directly to the supplier.
Oracle Notification Workflow mailer communicates the document to the supplier in an HTML
(HyperText Markup Language) format.
Setup in Oracle Applications
1. Configure the Notification Workflow for your site.
2. Set profile options PO:Secondary Email address, PO: In File Path, and PO:Terms and
Conditions File name as required for your business processes (see the Oracle Purchasing
Users Guide for details).
3. Start the Workflow Mailer.
Refer to the Oracle Workflow Guide for workflow details.
Setup in Oracle Purchasing
1. Set the supplier site Supplier Notification Method to E-mail.
2. In the Communication region for the supplier site enter the E-mail address.
3. Save your changes to the supplier site.
Refer to the Oracle Payables Users Guide for details.
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Purchasing Document E-Mail Setup Overview
Use in Oracle Purchasing

Create your purchasing document and select Approve. While in the Approval window note that
the E-mail checkbox is checked and your supplier site E-mail address has defaulted in. You
can override the address or change the method of supplier notification. Once your document
has been approved, workflow will direct your document to the Workflow mailer for delivery.
Refer to the Oracle Purchasing Users Guide for details.
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e-Commerce Gateway Overview

Oracle e-Commerce Gateway provides a single application to application integration solution
that works with Oracle Applications Financial, Manufacturing, and Supply Chain suite of
products. It operates in cooperation with workflow to extract the Oracle Applications
transaction and convert that transaction to an EDI standard flat file that is delivered to the EDI
translator.
eCommerce Gateway Concepts
Trading Partner: The trading partner is the supplier you are doing business with and is the
key link between Oracle e-Commerce Gateway and Oracle Purchasing.
EDI Translator: The Translator is a third-party software application designed to transform a
formatted file into any other format. Traditionally, it transforms proprietary formats to EDI
transactions according to the designated standard (such as X12 and EDIFACT).
Value Added Network: Value Added Network is a secure network for transmission of EDI
transactions. This is typically a third party network, but could also be the internet (with
appropriate security) or a direct electronic connection between the enterprises.
Code Conversion: The Oracle e-Commerce Gateway code conversion function provides a
method by which codes used by Trading Partners and electronic data standards can be
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Oracle e-Commerce Gateway Overview
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converted from and to codes used in Oracle Applications. A simple example is units of
measure. The buying organization uses each and the supplier uses Ea. This conversion can be
defined in the gateway to be handled automatically.
Setup and Use in Oracle Purchasing
1. Oracle e-Commerce Gateway must be implemented and working.
2. The supplier must be defined as a trading partner in e-Commerce Gateway. This is done
from the e-Commerce Gateway Administrator responsibility, Setup > Trading Partners.
See the Oracle e-Commerce Gateway Implementation Manual for complete details.
3. Optionally define any code conversions you and/or your supplier may require. This is
done from the e-Commerce Gateway Administrator responsibility, Setup > Code
Conversion. See the Oracle e-Commerce Gateway Implementation Manual for complete
details.
4. In the Setup > Purchasing > Document Types window, set the Archive Method to Archive
on Approve for each document type you want EDI enabled.
5. In the Supplier > Sites (T) EDI window set the EDI Location to the code for the supplier
site (usually the DUNS number or DUNS + 4).
6. Now when you approve your purchasing document the EDI box will be checked and your
document will be sent to the supplier by way of the Oracle e-Commerce Gateway.
Note: Documents sent by e-Commerce Gateway cannot be printed, e-Mailed, faxed, or sent by
XML from the Approval window.
Purchase Order EDI Transactions

EDI (Electronic Data Interchange) transactions are handled by Oracle e-Commerce Gateway.
This slide identifies the purchase order related transactions and the next provides a high level
overview of their setup.
Purchase Order (850/ORDERS) and Purchase Order Change (860/ORDCHG)
These transactions enable your organization to send purchase orders and purchase order
changes to the supplier electronically.
Price/Sales Catalogue (832/PRICAT)
This transaction provides suppliers with the ability to create and maintain pricing within Oracle
Purchasing. Specifically the supplier can create and update blanket purchase agreements.
Response to Request for Quotation (843/QUOTES)
This transaction provides suppliers with the ability to respond to request for quotations (RFQ)
electronically.
For details of the actual content of these transactions see the Oracle e-Commerce Gateway
Implementation Guide and see there are spreadsheet layouts available from Oracle MetaLink.
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Purchase Order EDI Transactions
Oracle XML Gateway Overview

Oracle XML Gateway supports both Business-to-Business (B2B) initiatives such as
communicating business documents and participating in industry exchanges in addition to
Application-to-Application (A2A) initiatives such as data integration with legacy and disparate
systems. It operates in cooperation with workflow to extract the Oracle Applications
transaction and convert that transaction to an OAG standard XML file.
XML Gateway Concepts
Trading Partner: The trading partner is the supplier you are doing business with and is the
key link between Oracle XML Gateway and Oracle Purchasing.
Code Conversion: The Oracle XML Gateway code conversion function provides a method by
which codes used by Trading Partners and electronic data standards can be converted from and
to codes used in Oracle Applications.
Transport Agent/Layer: Oracle Transport Agent (OTA) is a transport mechanism used to
send and receive XML documents in Oracle Applications. It provides guaranteed XML
message delivery, security, and message auditing.
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Oracle XML Gateway Overview
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Setup and Use in Oracle Purchasing

1. Oracle XML Gateway and Oracle Transport Agent must be implemented and working.
2. Workflow Agent Listener must be running.
3. The supplier/supplier site must be defined as a trading partner in XML Gateway. This is
done from the XML Gateway responsibility, Define Trading Partners.
4. If you are using a hub like Oracle Exchange you must define the hub in XML Gateway.
Both the buyer and supplier must be set up on the hub.
5. Optionally define any code conversions you and/or your supplier may require. This is
done from the XML Gateway responsibility, Define Code Conversion.
6. Now when you approve your purchasing document the XML box will be checked and
your document will be sent to the supplier by way of the Oracle XML Gateway.
Note: Documents sent by XML Gateway cannot be printed, e-Mailed, faxed, or sent by EDI
from the Approval window.
See the Oracle Purchasing XML Transaction Delivery Setup Guide for complete details on
these setup steps, as well as the file layouts (DTD) and a sample XML transaction.
Purchase Order XML Transactions

XML (eXtensible Markup Language)transactions are handled by Oracle XML Gateway. This
slide identifies the purchase order related transactions and the next provides a high level
overview of their setup.
Purchase Order and Release against Blanket PO (PROCESS_PO_007)
Using XML to transmit Oracle Purchasing purchase orders enables a buyer to accurately and
securely send purchase order information to the supplier.
Purchase Order Change (CHANGE_PO_006)
Buyers can also send information relating to changes made to an existing purchase order using
XML.
For details of the actual content of these transactions see the Oracle Purchasing XML
Transaction Delivery Setup Guide.
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Purchase Order XML Transactions
Retroactive Price Changes

Prices for items on purchase agreements can change over the effective period of an agreement
as a result of ongoing negotiations between the buyer and the supplier. In fact, it is common
practice in certain industries to initiate and execute against an agreement with an interim price.
A firm price may get finalized several months into the life of the agreement. In these scenarios
it is possible that the updated price is applicable retroactively.
Oracle Purchasing allows buyers to make price changes and have automatic updates to orders
(standard orders and blanket releases) referencing the modified agreements even if there has
been receiving and invoicing activities against them. Additionally, for orders that have been
received against, Oracle Purchasing automatically adjusts the accrued liability to reflect the
latest pricing. Finally, for orders that have been invoiced, Oracle Purchasing automatically
generates Price Adjustment Invoices in Oracle Payables.
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Retroactive Price Changes
Agenda
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Responsibility for Purchase Order Entry and Maintenance

You must determine where the operational responsibility for purchase order entry and
maintenance should be assigned. The level of staffing requirements for this function must be
determined based on volume and effort. Definition of the buyer responsibility, as well as other
purchasing responsibilities, should be reviewed for good internal control policies/practices and
proper segregation of duties. You may wish to consult with your internal or external auditors
prior to making a final decision on these issues.
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Responsibility for Purchase Order Entry and Maintenance
Purchase Order Integration Issues

Remember to include all interested parties in the development of purchase order processes.
Depending on the scope of your purchasing implementation, the following departments may
need to be involved in the process - Purchasing, Inventory, Planning, Receiving, Payables,
Assets and Accounting. This will ensure that the organizational goals are considered above
individual unit goals. Departmental requisitioners should also be involved in the purchase
order process development. Many of the issues surrounding purchase orders are first
encountered when discussing requisitions.
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Purchase Order Integration Issues
Creating Purchase Orders and Releases

Oracle Purchasing provides various ways to create purchase orders as follows:
Manually based on paper requisitions
Autocreate from on-line requisitions
Automatically through either Requisition Import or Create Releases
Import through the Purchasing Documents Open Interface
It is typical to allow Oracle Purchasing to combine lines from multiple requisitions onto a
single purchase order or release. This combining should result in fewer purchasing documents
issued, in fewer but more key suppliers being used, better pricing due to volume discounts, and
reduce overall administrative costs. Some organizations are concerned that because different
departments requisition lines are on the same purchase order or release, that requisitioners will
be confused about which lines are theirs.
You may also be concerned that requisitioners will be confused if all of the lines from a
particular requisition arent all on the same purchase order or release. Remember that
typically, requisitioners dont view purchase orders. Instead, requisitioners should view
updates made to their requisitions detailing for each shipment which purchase order and line
number that line was actually ordered on and with which supplier. For example, a decision to
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Creating Purchase Orders and Releases
require each requisition be placed fully on a single purchase order or release, would result in
three purchasing documents being created rather than two. If this organization had an
estimated processing cost of $50 per purchasing document, theoretically administrative costs
have increased as a result of this decision. Furthermore, if the pens had been negotiated with a
non-cumulative break price for a quantity of 10, then the unit prices on both individual
requisitions would be higher than if theyd been combined onto a single document.
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Purchase Order Numbering Options

You should be careful when using manual numbering that the decision doesnt result in the
need to create an off-line, manual, paper-based purchase order number tracking mechanism.
You should also be careful of adding intelligence to the purchase order number by embedding
information already kept by the system elsewhere.
There is no automated check in the system to ensure the information is synchronized in both
places. For example, a company may prefix their purchase order numbers with the buyers
initials. Since there is already a field to hold the buyers name, the possibility exists for the
values to conflict. Additionally, as the buyer staff changes, you would still have purchase
orders with a number prefixed with the initials of a previous buyer. There would also be no
reporting capability against that piece of the purchase order number.
When switching from manual to automatic numbering, you should ensure that the Next
Automatic Number to be assigned has been reset to a number larger than the largest assigned
number. For example, if the highest number assigned is 2115, set the next automatic number
to at least 2116, but maybe even to 3000.
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Purchase Order Numbering Options
Purchase Order Conversion Methodology

This interface allows you to convert purchasing documents from your current non-Oracle
system into Oracle Purchasing. You may use this interface on an on-going basis if you dont
use Oracle Purchasing but want to enter purchase documents for purposes of invoice matching
or other reasons.
Which purchase orders to convert
You should review your current purchase orders to determine whether all purchase orders, all
purchase orders in the last 24 months or only open purchase orders will be converted.
Determine conversion method
Dependent on the number of conversions overall, record volumes, resources available and
time, you may need to determine which conversions will be automated and which will be
manual. Conversion of 3,000 records may be automated for one user, but manual for another.
Determine data cleanup requirements
You will need to review purchase orders that will be converted to determine if any data
cleansing needs to be done.
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Purchase Order Conversion Methodology
Determine conversion reconciliation method and reports needed

You need to review reports available to ensure that they can support reconciliation of the
purchase orders converted through the interface.
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Electronic Transaction Delivery

All of the following methods provide automatic delivery of purchasing documents to the
supplier and should result in a lower cost per document for delivery.
Fax Considerations
Using integrated third party solution enables automatic document delivery.
Third party solution may provide other electronic delivery methods.
Depending on volume, cost per document should be lower than manual handling.
Provides an audit trail in terms of delivery confirmation.
E-Mail Considerations
No third party solution required.
No special supplier setup required.
Delivery confirmation and security are issues.
EDI Considerations
Enables supplier update of Oracle Purchasing price catalogs.
Third party EDI translator and secure network required.
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Electronic Transaction Delivery
e-Commerce Gateway is included in the technology stack for Oracle Applications.

Supplier must have EDI capability.
Delivery is secure and confirmed.
XML Considerations
No third party solution required (part of Oracle Applications technology stack).
Supplier must have XML capability.
Delivery is secure and confirmed.
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Integrated Products
Oracles e-Business suite of products provides many opportunities for you to streamline the
purchase order process. For many organizations, the investment quickly pays for itself in
increased productivity. The whole suite of self service products was created to move the
responsibility for a given process to the individual closest to the process. This in turn frees up
time for other individuals in the organization to concentrate on what they do best.
The most commonly talked about example in procurement is the buyer. Self service
applications free the buyer to analyze spend patterns and look for savings for the entire
enterprise. In the past much of the buyers time was spent reviewing purchase orders. Be sure
you havent overlooked an opportunity to enhance the purchase order process.
Typically the implementation guides provide a high level introduction to the products features.
For reference see: Oracle iProcurement Implementation Guide Release, Oracle iSupplier
Implementation Guide Release, and Oracle Sourcing Implementation Guide Release.
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Integrated Oracle Products
Summary
Purchase Orders
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Chapter 10
Automating Document Creation
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Automating Document
Creation
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business flow that results in a purchase of goods or services.
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Objectives
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Agenda
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Creating Purchase Documents from Requisitions

AutoCreate
The AutoCreate window can be used to search for approved requisitions in the requisition line
pool. Those requisitions can be used as a basis for creating RFQs, standard purchase orders,
blanket purchase agreement releases and planned purchase orders. Buyer intervention is
required to search the requisition pool and create the purchase documents.
Use the Create Releases Program
The Create Releases program is a concurrent request that may be scheduled to run periodically.
The Create Releases program can be used to generate blanket purchase agreement releases.
Buyer intervention can be eliminated for certain types of purchases by using the Create
Releases program.
Workflow
The PO Requisition Approval workflow automatically runs the PO Create Documents
workflow. Depending upon your implementation decisions, the PO Create Documents
workflow will end with unapproved or approved standard purchase orders or blanket purchase
agreement releases. Using the PO Create Documents workflow can make it possible to
eliminate buyer intervention for certain types of purchases.
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Creating Purchase Documents from Requisitions
Benefits of using AutoCreate

The Oracle Purchasing AutoCreate window can be used to search for requisition lines for
specific items or similar items. After finding requisition lines, you can make decisions about
how to consolidate similar requests and ensure the resulting purchase documents are sent to the
appropriate suppliers.
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Benefits of using AutoCreate
Overview of AutoCreate
Overview of AutoCreate
(N) AutoCreate
Requisition Line Pool
To create blanket purchase releases, standard purchase orders or planned purchase agreements,
the requisition line must have a status of Approved and not be associated with an existing
purchase document. For RFQs the requisition lines do not need to have a status of Approved.
Externally sourced requisition lines can be for system items (including outside processing
items) or one-time items (a description and a category). Internally sourced requisition lines are
supplied by internal sales orders and are not available for AutoCreation.
Automatic Creation
Use Automatic Creation mode to create purchase orders, blanket releases, planned purchase
orders or RFQs with a minimum number of keystrokes.
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Manual Creation
Use manual creation mode to create purchase orders, blanket releases, planned purchase orders
or RFQs and control the placement and grouping of requisition lines.
Note: Internally sourced requisition lines are supplied by internal sales orders, so they are not
available for autocreation. Internal requisitions will be covered in an advanced topic.
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Automatic Creation Mode

You provide search criteria to locate the requisition lines you want to place on a purchase order
or RFQ. After reviewing the requisition lines, you select all lines that you want. Then you
select the Automatic button to create the purchase order or RFQ. You have the option to group
requisition lines with the same item, revision, line type, unit of measure, and transaction reason
into individual purchase order lines. Similarly, you can group requisition lines with the same
item, revision, and line type into individual RFQ lines.
Use automatic creation mode when:
A majority of the requisition lines that your search criteria located are items you want to
place on the document.
You want Oracle Purchasing to determine where to place the requisition lines on the
document.
You want Oracle Purchasing to combine similar requisition lines.
You are creating or adding to a release.
You are using Requisition grouping.
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Automatic Creation Mode
Find Requisition Lines

Use the Find Requisition Lines window to search for requisition lines based on a variety of
different criteria including:
Approved
Requester
Requisition
Preparer
Buyer
Supplier
Supplier Site
Ship-To
Item
Description
You can find unapproved requisition lines by setting Approved to No. However, you will only
be able to create RFQs from unapproved requisition lines.
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Find Requisition Lines
Selecting Document Creation Criteria

Action: Choose one of the following document actions:
Create - Create a new purchase document
Add To - Add to an existing purchase document
Document Type: Choose from the following document types:
Standard PO
Blanket Release
Planned PO
RFQ
Buyers Auction (Oracle Sourcing)
Sourcing RFQ (Oracle Sourcing)
Grouping: Choose one of the following grouping options:
Default - requisition lines for the same item, revision, line type, unit of measure, and
transaction reason are combined into individual purchase order lines.
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Select Document Creation Criteria
Requisition - the autocreated documents parallel the structure of the requisition from
which they were created. If you select multiple requisition lines from the same requisition,
they will not be grouped (even if the lines are exactly the same) and will create multiple
lines on the resulting purchase document. For example 5 requisition lines will create 5
lines on the resulting purchase document. When using requisition grouping, you can
select lines from one requisition only and you cannot use manual creation mode.
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Select Requisition Lines

Requisition lines are ordered by item, item category and then need-by date.
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Select Requisition Lines
Select Automatic Creation Mode
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Autocreate New Document Window

You can accept the default values in this window or make changes if appropriate. After
selecting the Create button, Oracle Purchasing opens the appropriate transaction window
(Purchase Orders window or RFQs window) and displays the created line(s). The supplier and
supplier site are not required fields in this window. However, if AutoCreate creates the
document without a supplier and supplier site, they must be added to the purchase document
before it can be approved.
Oracle Sourcing Documents
If you have Oracle Sourcing implemented and you have chosen either the Buyers Auction or
Sourcing RFQ document type, then your document is created in Oracle Sourcing. You still
receive an acknowledgement window similar to the slide above with the new document
information. Once you select Create, a window is opened with your new document in Oracle
Sourcing. The rest of your actions for this type of document then continue in Oracle Sourcing.
See the Oracle Sourcing User Reference Guide of Online Help Files for Sourcing Buyers
available from Metalink or the Oracle Sourcing online help for more details.
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Autocreate New Document Window
Manual Creation Mode

Manual creation mode lets you take control of the actual placement of requisition lines on
purchase order lines. You move each line into the position you want it on the document by
using the Document Builder. You can combine like requisition lines onto a single document
line. If you want to combine two requisition lines for the same item, one with a predefined
item and one with a one-time item (a line with a category and description), use Modify on the
Tools menu to change the one-time item line to the predefined item.
Use manual creation mode when:
You want to manually choose the requisition lines to combine onto a single document line.
You want to specify the location of the items on the document (for example, specify
which purchase order lines the requisition lines will become).
You want to ensure you get the negotiated price when combining multiple requisition lines
with different prices.
Chapter
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Manual Creation Mode
Add to Existing Document

You can add lines to existing documents only if your security criteria allow you to modify
them.
Chapter
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Add to Existing Document
Modify Requisition Lines

Use the Modify feature when you want to split an existing requisition line into multiple
requisition lines that represent the same or different items. For example, if the requisition line
quantity is so large that a single supplier cannot fill the entire order by the need-by date, you
can split the requisition line and assign the split lines to different purchase documents written
to different suppliers. In an additional example, if you have a requisition line item that contains
parts that you want to order as unique items, you can split the requisition line into several lines.
Enter as many new lines as you need to represent the original requisition line. For each newly
created line, Oracle Purchasing automatically creates distribution lines and prorates quantities
for the new distributions based on the original requisition line distributions. When you return
to the AutoCreate Documents window, Oracle Purchasing displays the new requisition lines
that are now available for placement on a purchase order or RFQ if they meet your original
search criteria. The original requisition line is no longer available for purchase order or RFQ
placement, but your requester can easily review the modification status of a requisition line in
the Requisitions Summary window.
Chapter
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Modify Requisition Lines
Return Requisition Lines

Oracle Purchasing lets you return a requisition line to the requisition preparer. You might want
to return a requisition line if you are unable to obtain the requestors price and want the
requestor to resubmit the requisition for approval at a higher price. From the Tools menu,
select Return Requisitions to display the Return Requisitions window. Enter a reason for the
return and select OK to return all requisition lines on the current requisition except any lines
from the requisition already placed on a purchase order. When you return requisition lines,
they are no longer available in the requisition pool.
Once a requisition submitted in Oracle Purchasing has been approved, the requisition must be
returned for the original submitter to make changes to it. If the requisition was submitted using
Oracle iProcurement, the requestor can use the Withdraw feature to make changes and resubmit the requisition. The Withdraw feature is not available in Oracle Purchasing and can
only be used in Oracle iProcurement if no lines on the requisition are associated with purchase
documents.
The Send Notifications for Purchasing Documents program will distribute notifications for
returned requisitions. This program should be scheduled to run periodically.
Chapter
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Return Requisition Lines
Agenda
Chapter
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Benefits of using the Create Releases Program
Chapter
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Overview of the Create Releases Program

You can minimize purchase order administrative costs by automatically creating releases for
both manually entered and imported requisitions. Oracle Purchasing provides you with the
features you need to satisfy the following basic needs.
You should be able to:
Automatically create a release when you source your items from a single supplier using a
single blanket purchase agreement.
Specify for each approved supplier list entry whether you want to create approved releases
automatically, create releases automatically but require manual approval, or require the
use of the AutoCreate Documents window to create releases.
Run the Create Release process automatically as part of the requisition import process.
The Create Releases program converts approved requisition lines to blanket purchase
agreement releases based on the sourcing rules and approved supplier list entries.
Chapter
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Overview of the Create Releases Program
Automatic Release Generation

When you are defining your approved supplier list, you define how you want your releases
generated. The Create Releases program attempts to create a release only if the Release
Method in the approved supplier list is set to Automatic Release or Automatic Release/Review.
The following release methods are available in the approved supplier list:
Automatic Release: Automatically converts approved requisition lines to approved
blanket purchase releases based on the sourcing rules and Approved Supplier List entries.
Automatic Release/Review: Automatically converts approved requisition lines to
unapproved blanket releases.
Release Using Autocreate: Either the PO Create Documents workflow is used to create a
purchase document or buyers use the AutoCreate Documents window to collect, review,
and optionally modify requisition lines before creating and approving purchase
documents.
You can define a different release generation method for each item and supplier. For frequently
purchased items, you can set up Oracle Purchasing to automatically create and approve
releases. For expensive or critical items, you can let Oracle Purchasing create the releases,
Chapter
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Automatic Release Generation
while you review and approve them in a separate step. For infrequent purchases, your buyers
can take more control by using the AutoCreate Documents window to combine requests.
Chapter
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Running the Create Releases Program

(N) Reports > Run
The Create Releases program and the PO Create Documents workflow can both create releases
from requisitions submitted in either Oracle Purchasing or iProcurement. The Create Releases
program ONLY creates Blanket Purchase Agreement releases.
The Create Releases process generates releases when the following criteria are
met:
The requisition is sourced to an approved blanket purchase agreement that is not on hold.
The approved supplier list entry for the item, supplier, and agreement must be active, and
the release method must be set to Automatic Release or Automatic Release/Review in the
Approved Supplier List window.
The source agreement is still active and the release will not put the agreement over the
amount limit.
The release amount must be greater than the minimum line release amount.
Chapter
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Running the Create Releases Program
The supplier on the source agreement is active and not on hold.

The requisition line is approved and not already on a purchase order.
The line type of the requisition line is quantity based.
Manually submit: Manually submit the Create Releases program from the standard request
submission window.
Schedule: Schedule the Create Releases program to run periodically using the standard request
submission window.
Automatically submit after requisition import: If the PO: Release During ReqImport profile
option is set to Yes, the Create Releases program will be submitted after the ReqImport
program completes.
Chapter
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Create Releases Document Creation Prerequisites

A blanket purchase agreement: There MUST be an approved blanket purchase agreement in
place that is not expired and not overreleased.
Approved supplier list entry: There MUST be an approved supplier list entry for the item.
The Create Releases program does not work with commodities or one-time items (where just
the category and description are specified).
Release method: Along with the approved supplier list entry, the Release Method MUST be
set to either Automatic Release or Automatic Release/Review. If the Release Method is left
blank or set to Release using AutoCreate, the Create Releases program will not generate
blanket purchase agreement releases. The release method MUST be set regardless of whether
or not you have specified a source document.
Sourcing Rules and Sourcing Rule Assignments: A sourcing rule with a sourcing rule
assignment MUST be created for the Create Releases program to create blanket purchase
agreement releases. It is not enough to supply source document information (using the supplier
item catalog and selecting from a negotiated source for example) and a supplier and supplier
site on the requisition when submitting requisitions manually.
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Create Releases Document Creation Prerequisites
Effect of the PO: Automatic Document Sourcing profile option: If the PO: Automatic
Document Sourcing profile option is set to No, you MUST specify a blanket purchase
agreement on the Source Document tab relating the the approved supplier list entry. If the PO:
Automatic Document Sourcing profile option is set to Yes, you MUST have an approved
supplier list entry with the release method set to Automatic Release or Automatic
Release/Review. The release method cannot be blank and it cannot be set to Automatic
Release using Autocreate to automatically create releases.
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Agenda
Chapter
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Benefits of Automatic Document Creation using Workflow
Chapter
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Overview of Automatic Document Creation using Workflow

Manual requisitions can come from Oracle Purchasing or Oracle iProcurement. Imported
requisitions can come from a variety of sources.
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Overview of Automatic Document Creation using Workflow
Workflow Document Creation Overview

Releases are created from blanket purchase agreements.
Standard purchase orders are created from contract purchase agreements and catalog quotes
(the class must be Catalog which includes Catalog Quotations and Standard Quotations, not
Bid).
Documents are created automatically based on approved requisitions from:
Manual entry to Oracle iProcurement
Manual entry to Oracle Purchasing
Automatic import from other sources (Oracle and/or non-Oracle systems)
All documents are subject to standard approval rules.
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Workflow Document Creation Overview
Workflow Document Creation Prerequisites

A source document must exist in order for the PO Create Documents workflow to create a
release or purchase order. If a system item is associated with the requisition line, it is not
necessary to have supplier item number in order to get a standard purchase order or release
automatically created. The only time an approved supplier list is required is if your source
document is a blanket purchase agreement and you are using a system item. Sourcing rules are
not required if the requisition originates in Oracle Purchasing or iProcurement, but can help
default supplier and supplier site onto the requisition. Listed below are additional
prerequisites.
Blanket Purchase Agreement
Approved
Not expired
Not overreleased
Catalog Quote
Status = Active
Not expired
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Workflow Document Creation Prerequisites
Contract PO
Approved
Not expired
Not overreleased
Supplier and site on must be on requisition
Chapter
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PO Create Documents Workflow

Launch process to verify req line information
1. Get requisition line info and release generation method.
If no release method found, or if release method is Automatic Release/Review or
Automatic Release, workflow ends and automatic creation is not done through workflow.
If generation method is Release Using Autocreate and Should Workflow Create the
Release = Y records are inserted into a temp table as candidates for creation on a purchase
order or release.
2. Does Req Line Have Enough Information to Create Document?
Valid Supplier Information? (If no, end process)
Emergency Requisition? (If yes, go to Get Buyer process)
Does the req line have valid source document information? (If yes, go to Get Buyer
process)
Does contract exist and allow creation from contract? (If yes, go to Get Buyer process)
Chapter
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PO Create Documents Workflow
Chapter
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3. Get Buyer (check list and assign first buyer found)

Get buyer from req line
Get buyer from item
Get buyer from category (in the Buyers window)
Get buyer from source document
Get buyer from contract
4. Create and Approve Purchase Order and Release
Create purchase order or release
Send notification to buyer
Is automatic approval allowed? (If yes, launch doc approval process)
Setting the Key Workflow Attributes

Is Automatic Creation Allowed?
If this workflow attribute is set to N, the PO Create Documents workflow will not be used to
automatically create purchase orders or blanket purchase agreements. The Create Releases
program could still be used to generate blanket purchase agreement releases and/or the
AutoCreate form could still be used to generate standard purchase orders and blanket purchase
agreement releases.
Should Workflow Create the Release?
If this workflow attribute is set to N, the PO Create Documents workflow will not be used to
create blanket purchase agreement releases.
Should Contract be used to AutoCreate Doc?
If this workflow attribute is set to N, contract purchase agreements will not be used as a
reference document to create a standard purchase order.
Chapter
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Setting Key Workflow Attributes
Chapter
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Is Automatic Approval Allowed?

If this workflow attribute is set to N, any blanket purchase agreement releases and standard
purchase orders created by the PO Create Documents workflow will have to be approved in a
separate step.
To set key workflow attributes:
1. Install the appropriate version of Workflow Builder on your PC
2. Set up the connect string in the TNSNames.ora file
3. Start the workflow builder
4. Connect to the database
5. Choose the PO Create Documents Item Type (workflow)
6. Expand the Attributes section
7. Right click on the appropriate attribute and choose Properties
8. Set Value to Y or N
9. Save your changes
Note: In order to modify workflow files, you will need to install the workflow builder and
have access to the workflow. Since it is not necessary to be connected to the database to access
the workflow (it can be a previously downloaded copy), only those individuals who need to
access the database to save changed workflows will need to modify the tnsnames.ora to include
the appropriate connect string.
Workflow Document Creation Summary
Chapter
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Agenda
Chapter
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Automatic Document Creation Profile Options

PO: Allow Buyer Override in AutoCreate Find: Yes or No indicates whether the suggested
buyer (from the Enter Person window) defaulted into the Find Requisition Lines window can
be cleared or overridden. The default is Yes.
PO: Allow Category Override in AutoCreate Find: Yes or No indicates whether the
category (from the Buyers window) defaulted into the Find Requisition Lines window can be
cleared or overridden. The default is Yes.
PO: AutoCreate GL Date Option: Indicates the date used on purchase orders generated by
AutoCreate. The default is AutoCreate Date.
AutoCreate Date: The AutoCreate Date is used as the purchase order date
Requisition GL Date: The GL Date on the requisition is used as the purchase order date
Chapter
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Automatic Document Creation Profile Options
PO: Display the AutoCreated Document: Yes or No indicates whether Purchasing opens the
appropriate transaction window (Purchase Orders window or RFQs window) and displays the
created line(s) when you autocreate a document. The default is Yes.
PO: Release During ReqImport: Yes or No indicates whether Purchasing can automatically
create releases during the Requisition Import process. The default is No.
PO: Warn if RFQ Required before AutoCreate: Yes or No indicates whether you are given
a warning message and an opportunity to cancel AutoCreate if one or more of the requisition
lines selected for inclusion requires an RFQ and has not been placed on an RFQ. The default is
No.
Chapter
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Agenda
Chapter
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Additional Implementation Considerations

Which types of purchases will require buyer intervention with the AutoCreate window?
Which types of purchases can be automated with the Create Releases Program?
Can low risk, high volume, routinely requisitioned items be automated?
Which types of purchases can be automated with the PO Create Documents workflow?
Will automatic creation be allowed?
Should workflow be used to create the release?
Will automatic approval be allowed?
Will contract purchase agreements be used as a reference document to create standard
purchase orders?
Training and cutover
How will end-user training be conducted? Who will conduct the training? What type of
training would be most appropriate, instructor led training (ILT), one-on-one, instructor
led online (ILO), online, tutor?
Chapter
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Oracle Sourcing and Document Creation

You may want to consider Oracle Sourcing as part of your automatic documents creation
solution. Oracle Sourcing is tightly integrated with many of the Procurement Suite
applications. Requisitions consolidated in the AutoCreate window can be sourced in Oracle
Sourcing. At the completion of a successful sourcing event, Oracle Purchasing will display the
contract or project task reference in the purchase order or blanket agreement.
Oracle Sourcing shares the E-Business Suite data model with core applications. Consequently,
transaction data exists in the same database, obviating any need to migrate data between
applications.
Oracle Workflow - During the completion of a negotiation process in Oracle Sourcing, the
Sourcing Create Auction workflow process creates purchase documents and awards placed
during that negotiation process. The Oracle Sourcing user who completes the negotiation
process receives a notification after the completion of this workflow. The workflow
notification contains information about the number of purchase orders processed, as well as
details of those which were created successfully.
Oracle iSupplier Portal - Suppliers accessing Oracle iSupplier Portal can drill down from a
purchase order to the backing sourcing document and quotation in Oracle Sourcing.
Chapter
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Summary
Chapter
CLASSROOM

Chapter 11
Professional Buyers Work Center
Chapter
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Professional Buyers Work

Center
Chapter
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Objectives
Chapter
CLASSROOM
Procure to Pay: Procurement

The Professional Buyers Work Center provides a central point for buyers to manage
requisitions, consolidate requisitions into purchasing documents or supplier negotiations, and
manage purchasing documents.
Chapter
CLASSROOM
Procure to Pay: Procurement
Agenda
Chapter
CLASSROOM
What is the Professional Buyers Work Center?

As we have seen in earlier in this course, the standard forms you have used in the past for
entering requisitions, purchase orders, and purchase agreements are still available in R12. You
have the option to continue using those forms or to use our new web-based forms instead.
Chapter
CLASSROOM
What is the Professional Buyers Work Center?
Business Benefits of the Buyers Work Center
Chapter
CLASSROOM
Buyers Work Center Overview

(N) Buyer Work Center
Chapter
CLASSROOM
Buyers Work Center Overview
Agenda
Chapter
CLASSROOM
Demand Workbench and Requisition Summary

(N) Buyer Work Center > (T) Requisitions
The Buyer's Work Center presents requisition demand in views that are easily customized to an
individual buyer's way of working. These views allow buyers to quickly prioritize requisition
demand based on a variety of factors, such as sourcing status or commodity. Buyers can
aggregate demand from different organizations and consolidate it in a single document in an
organization that they designate. The document could be a solicitation (auction/RFx) for
bids/quotations (requires Oracle Sourcing) or a standard purchase order.
Demand Workbench
This page enables buyers to consolidate demand documents and create procurement documents
from that demand. There are views which are predefined in the application or buyers can create
views that provide results precisely fitting their procurement tasks.
Chapter
CLASSROOM
Demand Workbench and Requisition Summary
Summary
This page provides the buyer with the ability to find demand documents using very precise
parameters.
Chapter
CLASSROOM
Demand Workbench Requisition Views

(N) Buyer Work Center > (T) Requisitions > Demand Workbench
Note that all the requisitions shown in these views are unprocessed requisitions. That is,
requisitions waiting to be converted into Purchasing documents. To view requisitions in any
status use the Requisition Summary page.
My Requisitions
Requisition lines assigned to me for all line types.
My Requisitions for Goods
Requisition lines assigned to me with lines that have a purchase basis of Goods.
My Requisitions for Services
Requisition lines assigned to me with lines that have a purchase basis of Services and Temp
Labor. (Requires Oracle Services Procurement)
My Requisitions Requiring an RFQ
Requisition lines assigned to me that require an RFQ.
Chapter
CLASSROOM
Demand Workbench Requisition Views
My Requisitions with a New Supplier

Requisition lines assigned to me that were entered requiring a new supplier.
My Requisitions with a Suggested Supplier
Requisition lines assigned to me that were entered with a suggested supplier.
My Late Requisitions
Requisition lines assigned to me that are past the need by date.
My Urgent Requisitions
Requisition lines assigned to me that were marked urgent.
Unassigned Requisitions
Requisition lines not assigned to anyone.
Chapter
CLASSROOM
Personalized Requisition Views

You can create a personalized view to simplify finding those requisitions that you deal with the
most. If you frequently use the same advanced searches to restrict the display of requisitions,
you can also save these advanced views. These are called Personalized Views.
Note that these instructions apply to personalized views for requisitions, orders, and
agreements.
Chapter
CLASSROOM
Create A Personalized Requisition View
Requisition Summary
(N) Buyer Work Center > (T) Requisitions > Summary
The Requisition Summary is used to review existing Requisition information. Search for all
requisitions meeting your criteria:
Indicate whether all selections must match or just one.
Indicate whether the selection is included or excluded.
Add additional search criteria.
After creating your unique requisitions search you can save it for use in the Demand
Workbench later.
Chapter
CLASSROOM
Requisition Summary
Managing Requisitions in the Buyers Work Center

The Buyers Work Center offers requisition management capabilities similar to those available
using AutoCreate and the Requisition Summary forms.
Chapter
CLASSROOM
Managing Requisitions in the Buyers Work Center
Agenda
Chapter
CLASSROOM
Default and Personalized Order Views

(N) Buyer Work Center > (T) Orders
The Buyers Work Center enables buyers to edit and view delivery schedules and account
distributions across all order lines, thus eliminating the need to drilldown on individual lines.
Buyers can use one of the seeded views to access their orders, or create their own. Personalized
views enable buyers to effectively prioritize tasks and quickly drilldown to order details. A
search page enables buyers to find orders in a similar fashion to the forms based summary
window.
My Incomplete Orders
Orders assigned to me that have a status of Incomplete.
My In Process Orders
Orders assigned to me that have a status of In Process.
My Open Orders
Orders assigned to me that are not closed.
Chapter
CLASSROOM
Default and Personalized Order Views
My Orders with Pending Change Requests

Orders assigned to me that have a change request entered against it.
My Orders with Rejected Acknowledgments
Orders assigned to me that have acknowledgements required that were not approved.
Personalized Views
See the Create A Personalized Requisition View slide earlier in this topic for details.
Chapter
CLASSROOM
Order Details
(N) Buyer Work Center > (T) Orders [For Order Views]
(N) Buyer Work Center > (T) Orders > (H) Order [For Order Details]
Details of the purchase order can be quickly reviewed by selecting the Header, Lines,
Schedules, or Distributions tab.
Chapter
CLASSROOM
Order Details
Document Styles
Purchasing Super User Responsibility
(N) Setup > Purchasing > Document Styles
Document Styles enable buying organizations to control the look and feel of the application to
match the needs of different purchasing documents. Through reusable document styles,
deploying organizations can enable or disable various Oracle Purchasing features, thereby
simplifying the user interface.
There are several benefits of using document styles:
Document styles provide the ability to appropriately name purchasing documents to align
more closely with the naming conventions of the deploying organizations business. The
same purchasing document type (e.g. Standard Purchase Order) can assume different
names based on the style applied.
Some features on the purchasing document, such as price breaks in global agreements or
services line types, can be enabled or disabled as part of the style setup.
Chapter
CLASSROOM
Document Styles
When a purchasing document is created using a style, disabled features are hidden to
simplify the user interface. For example, organizations can create a document style for a
specific commodity, such as temporary labor. This document style optimizes field labels
and display for that commodity, simplifying purchase order entry by hiding
regions/attributes that are only relevant for goods purchases.
Chapter
CLASSROOM
Creating a Purchase Order in the Buyers Work Center

(N) Buyer Work Center > (T) Requisitions > Select Requisitions > (B) Add > Document
Builder: (B) Create
(N) Buyer Work Center > (T) Orders > Create: Standard Purchase Order > (B) Go
There are two ways for the buyer to create standard purchase orders in the Buyers Work
Center. The first is similar to the technique used in AutoCreate, that is, to select requisitions
from the Demand Workbench and click Add as though you are shopping online. Once all
appropriate requisitions have been added to the Document Builder you specify the document
style and click Create.
The second way starts on the Orders tab by selecting Standard Purchase Order from the Create
list and clicking Go. The buyer then enters the required information to complete the Header,
Lines, Schedules, and Distributions tabbed regions in a manner similar to the standard Enter
Purchase Order window. The main advantage to using the Buyers Work Center is that since
all tabbed information is on the same page, moving from one to the other is easier and actions
such as approval can be made at any time. For simple purchase orders that do not require
Chapter
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Creating a Purchase Order in the Buyers Work Center
Chapter
CLASSROOM
staged delivery schedules or multiple account distributions, buyers can quickly enter all
necessary information for the orders in the header and line sections, without having to navigate
to the schedules and distributions sections.
Other features of the Buyers Work Center for creating orders:
When adding lines to an order, buyers can either type in the information, or use the item
catalog to quickly find and select the items they need to procure.
The item catalog is the same Web-based catalog available to requesters in Oracle
iProcurement. If you have licensed and installed Oracle iProcurement, buyers use the
advanced capabilities that are currently available to requesters, such as punching out to
external sites, comparing items, and viewing the extensible attributes of an item.
As an alternative to entering lines using a tabular format, buyers can create lines using a
single page format. This format allows you to view all of the details for a single line,
whereas the tabular format allows you to see multiple lines, but with fewer details.
The single page format for lines enables buyers to provide both schedule and delivery
details while entering the line.
Buyers can easily view all of the schedules and distributions corresponding to all lines on
the order.
Unified Procurement Catalog Access

Oracle Purchasing builds on the popularity of Oracle iProcurements catalog search capabilities
by offering professional buyers a similar search interface to easily find the items they need to
procure.
From the Demand Workbench, buyers can access the catalog and favorites lists to find
negotiated alternatives to non-catalog requests.
While authoring orders and agreements, buyers can use the catalog or favorites to quickly add
items, thereby accelerating the document creation process.
Chapter
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Unified Procurement Catalog Access
Agenda
Chapter
CLASSROOM
Default and Personalized Agreement Views

(N) Buyer Work Center > (T) Agreement
The Buyers Work Center enables buyers to edit and view agreement lines in a tabular or
single page format. Buyers can use one of the seeded views to access their orders, or create
their own. Personalized views enable buyers to effectively prioritize tasks and quickly
drilldown to order details. A search page enables buyers to find agreements in a similar fashion
to the forms based summary window.
My Agreements with Pending Change Requests
Agreements assigned to me that have change requests entered against them.
My Agreements with Rejected Acknowledgments
Agreements assigned to me that have acknowledgements required that were not approved.
My Expiring Agreements
Agreements assigned to me that have an effective end date that has passed.
Chapter
CLASSROOM
Default and Personalized Agreement Views
My Incomplete Agreements
Agreements assigned to me that have a status of Incomplete.
Personalized Views
See the Create A Personalized Requisition View slide earlier in this Buyers Work Center
lesson for details.
Chapter
CLASSROOM
Order Agreement
(N) Buyer Work Center > (T) Agreements [For Agreement Views]
(N) Buyer Work Center > (T) Agreements > (H) Agreement [For Agreement Details]
Details of the agreement can be quickly reviewed by selecting the Header, Lines, or Controls
tab.
Document styles can be applied to agreements.
As with creating purchase orders, buyers can add lines to an agreement using a tabular
format, a single page format, or a combination of both.
All of the agreement controls, such as operating unit access and notification controls, are
accessible from the Controls tab of the agreement.
Chapter
CLASSROOM
Agreement Details
Creating a Purchase Agreement in the Buyers Work Center

(N) Buyer Work Center > (T) Agreements > Create: Blanket Purchase Agreement > (B) Go
Creating agreements in the Buyers Work Center starts on the Agreements tab by selecting
Blanket Purchase Agreement from the Create list and clicking Go. The buyer then enters the
required information to complete the Header, Lines, and Controls tabbed regions in a manner
similar to the standard Enter Purchase Order window. The main advantage to using the Buyers
Work Center is that since all tabbed information is on the same page, moving from one to the
other is easier and actions such as approval can be made at any time. Other features of the
Buyers Work Center for creating orders:
When adding lines to an agreement, buyers can either type in the information, or use the
item catalog to quickly find and select the items they need to procure.
The item catalog is the same Web-based catalog that is available to requesters in Oracle
iProcurement. If you have licensed and installed Oracle iProcurement, buyers can use the
advanced capabilities that are currently available to requesters, such as punching out to
external sites, comparing items, and viewing the extensible attributes of an item.
Chapter
CLASSROOM
Creating a Purchase Agreement in the Buyers Work Center
Buyer enables the agreement for Content Authoring use by Catalog Administrators or
Suppliers.
Lines can be uploaded to the purchase agreement from an external source such as a
suppliers catalog.
As an alternative to entering lines using a tabular format, buyers can create lines using a
single page format. This format allows you to view all of the details for a single line,
whereas the tabular format allows you to see multiple lines, but with fewer details.
Chapter
CLASSROOM
Uploading Blanket Agreement Lines

(N) Buyer Work Center > Agreements > Select Agreement: Update > Go > Lines > Add Lines:
Via Upload > Go
Global blanket agreements are the basis of the Procurement Unified Catalog as well as being
one of the foundation documents for Oracle Purchasing. The benefit to the buyer is that those
Content Authoring aspects built into the Buyers Work Center are available to simplify building
large agreements.
Chapter
CLASSROOM
Uploading Blanket Agreement Lines
Agenda
Chapter
CLASSROOM
Buyers Work Center Profile Options
Chapter
CLASSROOM
Requisition Management Key Profile Options
Chapter
CLASSROOM
Requisition Management Key Profile Options
Chapter
CLASSROOM
Enhanced Catalog Access Setup Preferences

You have the option to customize your catalog access by modifying your preferences. Using
the Shopping Purchasing Preferences you can define your view into the catalog including your
default store, search results per page, and your search results layout. Using the Favorites Lists
Preferences you can default your default favorites list.
Chapter
CLASSROOM
Enhanced Catalog Access Setup Preferences
Agenda
Chapter
CLASSROOM

The catalog is a very big addition to Oracle Purchasing. Along with it comes some
management considerations. For reference, see the Content Management chapter of the Oracle
iProcurement Implementation and Administration Guide.
Chapter
CLASSROOM

Purchasing Buyers Work Center
Consolidate and pass demand documents to Sourcing
Create and deliver purchase orders upon Sourcing award
Sourcing
Oracle Sourcing offers sophisticated negotiation capabilities that reduce the time it takes
buyers to source new products and services, as well as optimize the value of existing contracts.
With Oracle Sourcing you can:
Utilize collaborative preparation of negotiations, meaning several employees can work on
drafts of a negotiation.
Conduct real-time, multi-round RFQs and auctions.
Analyze negotiation responses (bids and quotes).
Award business.
Chapter
CLASSROOM
Summary
Chapter
CLASSROOM

Chapter 12
Receiving
Chapter
CLASSROOM
Receiving
Receiving
Receiving
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Procurement: Receiving
business flow that results in a purchase of goods or services. Receipt of the goods or services is
considered the final step of ordering in terms of Oracle Purchasing.
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Objectives
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Agenda
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What is Receiving?
Receiving is a process that signals that the goods ordered on a purchase order have arrived.
Oracle Purchasing lets you control the items you order through receiving, inspections, transfer
and delivery. You can:
Define receiving tolerances and rules at the organization supplier, item and order level,
with the lowest level overriding previous levels.
Use express receipt to receive an entire purchase order with a few keystrokes.
Use the cascade function to distribute a given quantity of an item from a single supplier
across multiple shipments and distributions.
Record receipt of unordered items, research receipt and match the delivery to an existing
purchase order.
Record delivery of items from receiving or inspection locations to their final destination
and also record transfers of items to different locations for inspection.
Define which of your items require inspection. You can accept or reject items and provide
detailed information about your inspection results.
Record returns to suppliers and customers.
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What is Receiving?
Correct receiving transaction errors.

Review transaction history.
Note that services ordered through Oracle Services Procurement are received automatically
when contractors enter their time cards in Oracle Time and Labor.
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Overview of Receiving Locations

You record inspections, deliveries and material movements within receiving and inspection by
entering receiving transactions. The transactions provide a history that allows you to track an
item from its source to its destination.
Receiving Transactions allow you to:
Transfer goods from one location to another
Document inspection results
Deliver goods to their required destination
It is the destination type that tells the system if the material is going to be received in the
receiving space or its final destination.
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Overview of Receiving Locations
Agenda
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Overview of Receipt Routing

Direct Receipt
One step. Goods are received and delivered in one step.
Standard Receipt
Two steps. Goods are received in one step and then delivered in a second. This allows for the
time it takes goods to move though your facility from the receiving dock. Quantity on hand in
subinventories is not updated until the delivery is completed. The quantity and cost is
maintained in the inventory organizations inventory receiving account until the delivery is
made.
Inspection Required
Three steps. Used for goods that require a more skilled person to do a careful review. Goods
are received in one step. Inspection either accepts or rejects the goods. Quality results can be
entered at this time. Goods that are accepted are delivered in the third step, while goods that
are rejected are returned to the supplier.
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Overview of Receipt Routing
Direct Receipt Routing

Direct routing allows receipt of items directly to their final delivery destination. This is
sometimes called a dock to stock transaction. The final destination type may be expense,
inventory, or shop floor.
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Direct Receipt Routing
Standard Receipt
Shipments are received into a receiving location and then delivered to an interim or final
destination. Goods are usually received and delivered in separate transactions. However, if the
RCV: Allow Routing Override profile option is set to Yes, users can override the default and
immediately deliver to the final destination. Setting the RCV: Allow Routing Override profile
to No forces a two step delivery process.
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Standard Receipt
Inspection Required
Inspection is a procedure you perform to ensure that items received confirm to your quality
standards. Goods must be received and inspected before they can be delivered to their final
destination. The QA: PO Inspection profile option can be set to either Purchasing or Quality.
If the profile option is set to Purchasing, a simple inspection window opens for recording
inspection results. If the profile option is set to Quality and a quality inspection plan exists, the
Oracle Quality window is opened and inspection results may be recorded based on a
predefined inspection plan.
Skip Lot Inspection (not shown above)
Oracle Purchasing supports another form of inspection called skip lot inspection. Skip-lot
inspection is an inspection technique often employed as a next step to a lot-by-lot inspection. If
the QA: PO Inspection profile option is set to Quality and a skip lot plan has been set up in
Oracle Quality, the inspection results can be entered during the receiving process.
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Inspection Required
Oracle Process Quality Integration
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Receipt Processing Methods

Standard receipt: One line at a time.
Express receipt: Multiple lines at a time. For example, an entire purchase order for a supplier.
During express receiving you can always deselect items and change quantities prior to
completing the process.
Cascade receipt: One receipt of multiple shipments of the same item. For example, same
supplier and same item represented on multiple purchase documents.
ASNs or ASBNs - iSupplier Portal: You can give your supplier carefully limited access to
allow them to enter ASNs or ASBNs.
ASNs or ASBNs - e-Commerce Gateway: Load ASNs or ASBNs using Oracle e-Commerce
Gateway.
ASNs or ASBNs - XML Gateway: Load ASNs or ASBNs using Oracle XML Gateway.
Receiving in Oracle iProcurement: You can give your employees limited ability to receive
some types of items through a web browser.
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Receipt Processing Methods
Receiving Open Interface: Use barcoding software to scan receipts and create a text file that
can be loaded into the Receiving Open Interface and processed by running the Receiving
Transaction Processor.
Receiving Notification: The PO Confirm Receipts workflow can be scheduled to send
notifications to requesters asking them to confirm receipts against expected receipts.
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Standard Receipt
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Express Receipt
The express function is a quick method of entering receipts and receiving transactions. This
function is available if you have specified or inferred a source document. With a few
keystrokes you can receive the entire open order quantity of a purchase order. When you
search for expected receipts, either specify a single supplier or use search criteria that will
derive a single supplier.
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Express Receipt
Cascade Receipt
The cascade function facilitates the distribution of a given quantity of an item from a single
supplier across multiple shipments and distributions. This function is available if you have
specified or inferred a source (a specific supplier or customer) and an item when you search for
expected receipts.
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Cascade Receipt
ASNs and ASBNs

Enter Advanced Shipment Notices (ASNs) and ASBNs using either Oracle iSupplier Portal, eCommerce Gateway, or XML Gateway. The Receiving Transaction Manager is then used to
validate and import the receipt. The Enter Receipts window is used to confirm the actual
receipt of goods when it arrives.
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ASNs and ASBNs
Desktop Receiving in Oracle iProcurement

Receive (1): You receive the actual goods. That is, they are delivered to you.
Confirm (2): You can confirm physical receipt of goods using iProcurement as well as the
Enter Receipts form in Oracle Purchasing, provided you are using a receipt routing of Direct
Delivery. You will not find expected receipts if the receipt routing is set to Standard Receipt
or Inspection Required.
You can schedule the Confirm Receipts Workflow Select Orders process to run at regular
intervals. The Confirm Receipts Workflow Select Orders process runs the PO Confirm
Receipts workflow. The Confirm Receipts workflow sends notifications through the Web, email, or Notifications Summary window to requesters or buyers who create requisitions
through Oracle Purchasing or Oracle iProcurement. It lets people know they should have
received an item. The Confirm Receipts workflow sends notifications for items with a
Destination or Deliver-To Type of Expense, a Receipt Routing of of Direct Delivery, and a
Need-By date that is equal to or later than todays date.
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Desktop Receiving in iProcurement
Entering Expected Receipts
Entering Expected Receipts

(N) Receiving > Receipts
Choose the organization (1): When you first access the Receipts window, you will be forced
to choose an inventory organization from the list of values if you can process receipts for more
than one. You can change the organization manually if you have access to the Change
Organization window. Although it is not always the case, you can think of an inventory
organization as a warehouse. When you write purchase orders, for example, you specify goods
to be shipped to specific inventory organizations. You will only be able to view expected
receipts (scheduled shipments for a purchase order line item) for the inventory organization
you choose. Use the Organization Access form to limit access to the list of inventory
organizations for a specific responsibility.
Find expected receipts (2): Expected Receipts can and do come from different sources
because they are based on source documents like purchase order scheduled shipments to
suppliers, Internal Sales Orders resulting from Internal requisitions and customer returns
(processed in Oracle Order Management). When no source document can be found, the order
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can be processed as an Unordered receipt provided the Allow Unordered Receipts Receiving
option is enabled on the scheduled shipment.
Use the Find Expected Receipts window to find source documents. You can enter as many
criteria as desired to search for expected receipts. The more information you include, the more
restrictive the search is. The focus of this course is those receipts that are expected for a
supplier as a result of a purchase order or release that was issued. Other sources of goods to be
received are from either internal inventory organizations, or from customers.
Input receipt header (3): Input receipt header details like freight carrier, comments and
packing slip.
Choose processing mode (4): Choose the most efficient method to process the invoice.
Choose to process the receipt as a standard, express or cascade receipt.
Input receipt details (5): Input receipt details like quantity, unit of measure, location and
subinventory (if necessary). The method of receipt routing determines if the destination
defaults to Receiving or a final destination like Inventory, Expense or Shop Floor. You can
override this option (for example, when using Standard Delivery, the destination will default to
Receiving but you override it to a final destination) only if the RCV: Allow Routing Override
profile option is set to Yes. Also the Enforce Ship-To Receiving option determines whether
the receiving location must be the same as the Ship-To location. The Enforce Ship-To option
can be set to allow the receipt, allow the receipt but warn the receipt processor or not allow the
receipt to be processed.
Save (6): Save the receipt. Depending on the setting of the RCV: Processing Mode profile
option, the receipt will be processed immediately or submitted as a batch or deferred process.
You can always get printed documentation of your receiving transactions by setting the profile
option RCV: Print Receipt Traveler.
Note: Depot Repair can invoke receiving forms with requisite data such as requisition number
and/or requisition line number, and the system directly displays the results of the search
criteria, completely bypassing the 'find' screen.
Receipt Structure
Headers
The receipt header contains details relating to the overall purchase receipt. There can be only
one header per receipt.
Lines
The receipt line contains details about the goods or services you received.
Receiving Tables
RCV_SHIPMENT_HEADERS
RCV_SHIPMENT_HEADERS stores common information about the source of your receipts
or expected receipts. You group your receipts by the source type and the source of the receipt.
Oracle Purchasing does
not allow you to group receipts from different sources under one receipt header.
RCV_SHIPMENT_LINES
RCV_SHIPMENT_LINES stores information about items that have been shipped and/or
received from a specific receipt source.
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Receipt Structure
RCV_TRANSACTIONS
RCV_TRANSACTIONS stores historical information about receiving
transactions that you have performed. When you enter a receiving
transaction and the receiving transaction processor processes your
transaction, the transaction is recorded in this table.
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Receipt Header
Receipt Number: Enter a unique receipt number. If automatic receipt number generation is
active, the system will assign the next available receipt number. Numbering options are set
one time for each inventory organization. You can also add receiving transactions existing
receipts.
Receiver Name: The receiver name will default in from the user id. You can override the
default with the name of another receiver.
Date: Todays date will default in from the system date. You can backdate a receipt if
necessary, but the accounting period that the receipt date fall into must be open to do so.
Freight Carrier: You may enter the carrier who delivered the goods using the list of values.
This information will default if an ASN was sent.
Packing Slip / Air Bill Number: You may enter the packing slip or air bill number that the
goods came in on. This information will default if an ASN was sent.
Number of Containers: You may enter the total number of containers that made up this
shipment.
Comments: The receiver may enter any comments here. An example might be; The box was
wet.
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Receipt Header
Receipt Line
Quantity: Enter the quantity actually received. If you have allowed blind receiving in the
inventory organizations receiving options, this field will be empty.
Unit of Measure: The unit of measure for the receipt will default here.
Item: The system item number (if one exists) will display here.
Description: The description for the item will display here.
Destination Type: The final destination of the receipt (Expense, Inventory or Shop Floor) or
Receiving is displayed. For a direct receipt the destination will be either: inventory, expense or
outside processing. A standard or inspection receipt will have a destination type of receiving.
Order Number: The order number will default (purchase order number or sales order
number).
Receipt Type: The receipt type for this order will default here. Either direct, standard or
inspection.
Requestor: If the destination type is expense or inventory, and the order was created from a
purchase requisition, the name of the requestor will default.
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Receipt Line
Subinventory: If the destination type is inventory this field is required. If the sub inventory
was specified on the requisition or purchase order, it will default here. If no value defaults, the
receiver will have to fill in which subinventory the goods are to be delivered to.
Note to Receiver: If a note to the receiver was entered either on the requisition or the purchase
order, it will display here.
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Control the Receiving Transaction Processor

The setting of the RCV: Processing Mode profile determines the processing mode used after
you save your work for receiving transactions. The profile option can have one of three
possible settings:
Online: The Receiving Transaction Processor is called directly to process the receipt (no
concurrent request is submitted). The form is not immediately returned to user control, so the
user will not be able to perform any other application activities until the process completes.
Form response time is the slowest of the three options, but errors processing the receipt
become obvious immediately.
Immediate: The transaction goes to the interface table, and the Receiving Transaction
Processor is called for the group of transactions that you entered since you last saved your
work. The form will start running the Receiving Transaction Processor as a background
process. Control is returned to the user immediately so other application activities may be
performed. Form response time is fast, but a concurrent process is run each time you process a
receipt.
You must occasionally check the concurrent manager to ensure the concurrent request
completes without errors. If an error occurs, the problem must be fixed. You use the
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Control the Receiving Transaction Processor
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Transaction Status Summary form to delete errored transactions and force them to reprocess.
This is important especially for transactions destined for Inventory or Shop Floor. Until the
receipt processes successfully, no receipt accruals are generated and sent to the general ledger.
If the problem is not reconciled by period end, accruals will be out of balance and understated
in General Ledger.
Batch: The transaction goes to the interface table, where it will be picked up the next time the
Receiving Transaction Processor runs. Control is returned to the user immediately so other
application activities may be performed. Form response time is fast. The transaction will be
processed by running the Receiving Transaction Processor process. This program must be
scheduled to run periodically. The longer the interval, the more data the program will process
each time it runs.
Errors are handled the same way they are handled when the mode is set to Immediate.
Typically, customers will run this program periodically based on their processing and system
requirements. For example, you may elect to run the process at a time when there is relatively
low database activity to help balance the load on system resources. Using this method, receipt
accruals are not processed until the concurrent process completes successfully. Also, inventory
value and on-hand quantities are not updated until the concurrent request completes.
Receiving Tolerances
You can define days early and late that you will accept a shipment. You can also define what,
if any percentage above the quantity ordered you will receive.
You have three actions you can place to enforce those tolerances:
None - no action is taken
Reject - The receiver is unable to receive the shipment. The buyer will have to either
adjust the tolerances on the PO, or change either the quantity and need by date on the PO.
Warning - The receiver will see a pop up window if a tolerance is exceeded. The receiver
has the option of accepting the shipment or turning the shipment away.
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Receiving Tolerances
Control Numbers
There are various types of tracking information that Oracle Inventory supports which can be
included at the time of the receipt.
Lot Numbers: A lot number is a unique number assigned to a certain batch or process run of a
product. You can assign expiration dates for each lot number. Lot number control is an item
attribute that can be found and set by choosing the Inventory tab in either the Master Items or
Organization Items windows.
Serial Numbers: A serial number is a unique number assigned to an individual item. When an
item under serial number control is received, the user performing the transaction will be forced
to enter a unique serial number for each item. Serial number control is an attribute on the
inventory tab of the item (either in Master Items or Organization Items).
Stock Locators: You use locators to identify physical areas where you store inventory items.
Item quantities can be tracked by locator. Items can also be restricted to specific locators. An
example of a stock locator might be Row-Rack-Bin number. You can require Stock Locator
control at the inventory organization level, the subinventory level, or the item level.
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Control Numbers
Sublot Control:
Sublot control allows you to track the parent lot from which multiple lots were created.
The parent lot may refer to the production batch that spawned the lot, but if the output of
that batch varied in term of grade or other QC attributes, multiple sublots could be
received into inventory. You can query lots by their parent lot and view the parent lot in
the lot genealogy form. You can also grade control your lot controlled items.
If sublot control is enabled for a given item, Oracle Receiving requires quantity entry of
the parent lot for each new lot received.
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Substitute Receipts
When entering items in the Item Master, you have the ability to identify parts that can be
substituted for each other. In Oracle Purchasing, you can receive predefined substitute items
when you allow suppliers to ship alternatives to the item you order. If you are running a
constrained or optimized plan in Oracle Advanced Supply Chain Planning, the substitute
relationship will be recognized.
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Substitute Receipts
Unordered Receipts
You can receive items from a supplier when you do not have or do not know a corresponding
purchase order number. These items are tracked on the system while you wait for a buyer to
specify which purchase order should be used, or if the items are to be returned to the supplier.
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Unordered Receipts
Overview of Returns and Corrections

Returns
You can return delivered items to receiving and return received or delivered externally sourced
items to the supplier if the purchase order has neither been canceled nor finally closed. You
can also return to the supplier unordered receipts that have not been matched. Optionally
specify additional return information such as a Reason Code and RMA (Return Material
Authorization) number.
Corrections
Oracle Purchasing provides the capability to correct any receiving transaction, except another
correction and a return to a receiving transaction. Each transaction is done individually
correcting the previous transactions until all applicable transactions are corrected.
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Overview of Returns and Corrections
Entering Returns
Use the Receiving Returns window to enter returns against receipts, deliveries, transfers,
acceptances, and rejections. You may enter an RMA number from your supplier, as well as
specify any user defined return reason. You can return delivered items to a receiving location
when they are routed to the wrong destination, require inspection, or require a return to a
supplier or a customer in a later transaction.
When you perform a Return to Supplier transaction, Oracle Purchasing reopens the associated
purchase order for the return quantity by reducing the original receipt quantity. You cannot
perform a Return to Supplier transaction against a Finally Closed or Cancelled purchase order.
When you perform a Return to Supplier transaction, Oracle Purchasing automatically creates
both a Return to Receiving and a Return to Supplier transaction.
Note: You cannot enter returns for internal shipments.
Material Status Control
Quality Control and product lifecycle issues may require that certain material, although
stored in a ready to use state in the warehouse or production facility, may not be usable for
certain applications. A lot that has not yet passed inspection should not be shipped to a
customer or consumed in production. A warehouse location that has been discovered to
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Entering Returns
have erroneous inventory balances should not be included in available to promise

calculations.
If material status control is enabled for a given lot or serial controlled item, Oracle
Receiving requires quantity entry of the status for each new lot or serial received.
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Entering Corrections
Corrections are entered by using the adjustment quantity, either positive or negative. To reduce
a ten-item delivery to nine, enter -1 in the Quantity field. To increase a ten-item delivery to
eleven, enter 1 in the Quantity field. You cannot create supply when none exists. For example,
if you receive and deliver 10 items before discovering that you actually delivered 11 items, you
cannot simply increase the delivery quantity to 11. First you must increase your receipt
transaction from 10 to 11. Then you can increase your delivery transaction from 10 to 11.
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Entering Corrections
Comparing Returns and Corrections

Receiving Return
You can return delivered items to receiving and return received or delivered externally sourced
items to the supplier if the purchase order has neither been canceled nor finally closed. You
can also return to the supplier unordered receipts that have not been matched.
You can also optionally specify additional return information such as a Reason Code and RMA
(Return Material Authorization) number.
Receiving Correction
Oracle Purchasing provides the capability to correct any receiving transaction, except another
correction and a return to a receiving transaction. Each transaction is done individually
correcting the previous transactions until all applicable transactions are corrected.
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Comparing Returns and Corrections
Overview of Pay on Receipt

Oracle Purchasing works in conjunction with Oracle Payables to streamline the procurement
process by generating invoices to suppliers based on receipt transactions. Negotiate with key
suppliers to use Pay on Receipt. Every invoice created by the Pay on Receipt process is one
less receipt that needs to be manually keyed into Oracle Payables. Suppliers can still send the
hard copy of the invoice if a physical copy is necessary for archiving. Pay on Receipt enables
you to automatically create standard, unapproved invoices for payment of goods based on
receipt transactions. Invoices are created using a combination of receipt and purchase order
information, eliminating duplicate manual data entry and ensuring accurate and timely data
processing. Payment on Receipt is also known as Evaluated Receipt Settlement (ERS) and Self
Billing.
See the Oracle Payables Users Guide and the Oracle Purchasing Users Guide for more
information.
You can set up your suppliers so the invoice can be based on receipt of goods or delivery of
goods to their final destination. The Invoice Summary Level, set at the Supplier Site, controls
the number of invoices generated.
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Overview of Pay on Receipt
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Packing Slip - One invoice will be generated per packing slip. (highest number of
invoices)
Receipt - One invoice will be generated per receipt.
Site - One invoice will be generated per supplier site (fewest invoices)
After receipt or delivery transactions are created, you must run the Pay on Receipt Autoinvoice
process to create invoices and automatically match them to their corresponding purchase
orders. The Pay on Receipt Autoinvoice process can be set up to run automatically. Set the
PO: Invoice Number Prefix profile to add a prefix of your choice to the invoice that is created.
The number is created based on the Invoice Summary Level.
Packing Slip - The packing slip number is used as a basis to generate the invoice number.
Receipt - The receipt number is used as a basis to generate the invoice number.
Site - The date is used as a basis to generate the invoice number.
Set the PO: ERS Aging Period profile to a number of days after the receipt to actually create
the invoice when the Pay on Receipt Autoinvoice process runs. A delay will give you time to
enter corrections, adjustments and returns (if any) and will result in more accurate invoices
being created.
You can indicate your own prefix for Pay on Receipt invoices by setting the profile PO: ERS
Invoice Number Prefix. In addition, the invoice number can include a self billing identifier
which is set up in the Purchasing Options: Control window.
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Receiving Open Interface (ROI)

The Receiving Open Interface enables receipt processing from sources outside of Oracle
Purchasing. This is typically a three step process.
Load (1)
The receiving open interface is used to process receipts loaded by the Oracle e-Commerce
Gateway, from a flat file (if bar-coding is used, for example), or ASNs and ASBNs loaded
through the Oracle iSupplier Portal.
Process (2)
After receipts are loaded, run the Receiving Transaction Processor from Oracle Purchasing to
validate them.
Confirm (3)
Receipts may be confirmed using the Confirm Receipts window or through a notification sent
by the Confirm Receipts workflow before they create accruals and can be delivered to their
final destination.
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Receiving Open Interface (ROI)
ROI Supported Transactions

The Receiving Open Interface does not support:
Unordered receipts
Movement statistics
Dynamic locators
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ROI Supported Transactions
Load the Receiving Open Interface

Using SQL Loader or a custom created program, load your receipt information into the
Receiving Open Interface.
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Load the Receiving Open Interface
For details see the Oracle Manufacturing APIs and Open Interfaces Manual.
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Receipt Import Validation
Purchasing Open Interface Tables
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Agenda
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Receiving Reports
Expected Receipts Report
The Expected Receipts Report can be used to review all or specific supplier sourced expected
receipts or expected customer returns that have not yet been received for a particular date or a
range of dates. The report excludes purchase orders that are cancelled, closed, or closed for
receiving at the header, release, line, or shipment level. You can specify the expected receipts
you want to review.
Unordered Receipts
The Unordered Receipts Report lists all or selected unordered receipts. Unordered receipts
refer to received items that receivers could not match to purchase orders or return material
authorizations (RMAs).
Substitute Receipts Report
Use this report to review all or specific substitute receipts.
Receiving Transaction Register
The Receiving Transactions Register lists detail information about your receiving transactions.
The register is sorted by item, category, receipt number, document number, and transaction
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Receiving Reports
date. The three-part document number represents purchase order number, purchase order line
number, and purchase order shipment number.
Receiving Exceptions Report
Use the Receiving Exceptions Report to review receipts for which there is a receipt exception.
These receipts cannot be automatically closed for receiving or invoicing. You can enter a
receipt exception when you receive the item.
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Receiving Reports
Receiving Value by Destination Account Report
The Receiving Value Report by Destination Account lists received items by purchase order
destination and distribution account. If you accrue both inventory and expense at the time of
receipt, you may have both inventory and expense as part of your receiving valuation account.
Receiving Value
The Receiving Value Report shows item quantity, valuation, and detailed receipt information
for your receiving inspection location.
Receipt Adjustments Report
Use this report to review purchase order shipments or internal requisition lines with corrections
or returns to vendor.
Receipt Traveler
The Receipt Traveler facilitates receiving inspection and delivery of goods you receive within
your organization. After you receive the goods, you can print receipt travelers and attach these
tickets to the goods. This can be automated by setting the profile option RCV: Print Receipt
Traveler.
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Receiving Reports
Agenda
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Purchasing Options
(N) Setup > Organizations > Purchasing Options
Control Tab
Receipt Close Point: Select the Receipt Close Point, which is when the shipment is closed for
receiving: Accepted (passed inspection), Delivered, or Received. Note that you need to set the
receipt close tolerance percentage in the Default Options window.
Default Tab
Receipt Close Percent: Enter the Receipt Close tolerance percentage for your shipments.
Purchasing automatically closes a shipment for receiving if it is within the receiving close
tolerance at the receiving close point. Set the receiving close point in the Control Options
window. You can override this option for specific items and orders.
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Purchasing Options
Receiving Options
(N) Setup > Organizations > Purchasing Options
Receipt Date
Days Early: Enter the maximum acceptable number of Days Early for receipts.
Days Late: Enter the maximum acceptable number of Days Late for receipts.
Action: Enter the Action for Receipt Date Control. This field determines how Purchasing
handles receipts that are earlier or later than the allowed number of days selected above.
Choose one of the following options:
None - Receipts may exceed the allowed days early or late.
Reject - Oracle Purchasing does not permit receipts outside the selected number of days
early or late.
Warning - Oracle Purchasing displays a warning message but permits receipts outside the
selected number of days early or late.
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Receiving Options
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Over Receipt Control

Tolerance: Enter the maximum acceptable over-receipt Tolerance percentage.
Action: Enter the Action for Overreceipt Quantity Control. This field determines how Oracle
Purchasing handles receipts that exceed the quantity received tolerance. Choose one of the
following options:
None - Receipts may exceed the selected tolerance.
Reject - Oracle Purchasing does not permit receipts that exceed the selected tolerance.
Warning - Oracle Purchasing displays a warning message but permits receipts that exceed
the selected tolerance.
Receipt Number Options
Action: Choose the Entry method for receipt numbers:
Automatic: Oracle Purchasing automatically assigns a unique sequential number to each
receipt when you create the receipt.
Manual: You provide a receipt number manually when you enter the receipt.
Oracle Purchasing numbers receipts within inventory organizations rather than across
inventory organizations. So, for example, the same receipt number could be used by
different inventory organizations.
Note: You can change the method of entering receipt numbers at any time. If you originally
allow manual entry and switch to automatic entry, make sure to enter a Next Number that is
higher than the highest number you assigned manually.
Type: Choose the receipt number Type you want Oracle Purchasing to use for receipt
numbers: Numeric or Alphanumeric.
Notes: If you choose Automatic receipt number entry, you can generate only numeric receipt
numbers, but you can still import either numeric or alphanumeric values from another
purchasing system. If you have any alphanumeric documents in your system, you must choose
Alphanumeric as your number type, regardless of your numbering method.
If you choose Manual receipt number entry, you can choose numeric or alphanumeric numbers.
You can change the receipt number type from Numeric to Alphanumeric whenever you want.
You can change the receipt number type from Alphanumeric to Numeric only if all your
current receipt numbers are numeric. The ordering of numeric values in lists of values can
appear random when you use the Alphanumeric number type.
If you are using Alphanumeric numbering, consider entering all numeric values with the same
number of digits. For example, if you can assume all numeric values contain six digits, you
should enter the first value as 000001.
Next Receipt Number: Enter the Next Receipt Number. This is the starting value you want
Oracle Purchasing to use for generating unique sequential receipt numbers if you choose
Automatic receipt number entry. Oracle Purchasing displays the next receipt number that will
be used for a new receipt when you create the new receipt. You cannot enter this field if you
choose Manual receipt number entry.
Receiving Options
(N) Setup > Organizations > Receiving Options
Miscellaneous
Allow Substitute Receipts: Check Allow Substitute Receipts if you want to receive substitute
items in place of ordered items. You must define substitute items in the Item Relationships
window before you can receive them. You can override this option for specific suppliers,
items, and orders.
Allow Unordered Receipts: Check Allow Unordered Receipts if you want to receive
unordered items. You can later match the unordered receipts to a purchase order. If you enable
this option, you can override it for specific suppliers and items.
Allow Express Transactions: Check Allow Express Transactions to enable express deliveries
and receipts.
Allow Cascade Transactions: Check Allow Cascade Transactions to enable cascading for
receipts and receiving transactions.
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Receiving Options
Receiving
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Allow Blind Receiving: Select Allow Blind Receiving if you want blind receiving at your site.
Blind receiving helps you ensure that receivers record the exact amount they receive. With
blind receiving, you cannot see the quantity due or the quantity ordered for shipments when
you receive items. Oracle Purchasing ignores all quantity receipt tolerances to help ensure that
you can receive the exact amount the supplier shipped.
Receipt Routing: Enter the default Receipt Routing that you assign goods: Direct Delivery,
Standard Receipt, or Inspection Required. You can override this option at receipt time by
changing the destination type for specific suppliers, items, and orders if the RCV: Allow
Routing Override user profile is set to Yes.
Enforce Ship-To: Enter the Enforce Ship To location option to determine whether the
receiving location must be the same as the ship-to location. Choose one of the following
options:
None - The receiving location may differ from the ship-to location.
Reject - Oracle Purchasing does not permit receipts when the receiving location differs
from the ship-to location.
Warning - Oracle Purchasing displays a warning message but permits receipts when the
receiving location differs from the ship-to location.
ASN Control Action: Choose an action for ASN Control. This field determines how Oracle
Purchasing handles receiving against purchase order shipments for which an Advance
Shipment Notice (ASN) exists. Choose one of the following options.
None - Oracle Purchasing does not prevent or warn you when you try to receive against a
purchase order shipment for which an ASN exists.
Reject - Oracle Purchasing gives you a message and prevents you from receiving against a
purchase order shipment for which an ASN exists.
Warning - Oracle Purchasing gives you a message informing you that an ASN exists for
the purchase order shipment and lets you decide whether to receive against the purchase
order shipment or its ASN.
Accounting
Receiving Inventory Account: Enter the accounting flexfield for the default Receiving
Clearing Account.
Account Description: A non-updateable field with the description of the Receiving Inventory
Account.
Profile Options
PO: Enable SQL Trace for Receiving Processor
Yes means that when you run the Receiving Transaction Processor, the View Log screen
displays the receiving transaction pre-processors actions, including errors, as it processed the
receipt data from start to finish. Yes also generates a trace file in the database; if you need help
with an error that occurs while the Receiving Transaction Processor runs, Oracle Support
Services may ask you for this trace file. This profile option should be set to Yes only while
debugging the Receiving Open Interface. The Receiving Open Interface validates receipt
transactions from other systems and uses the Receiving Transaction Processor to import the
validated data into Purchasing.
RCV: Fail All ASN Lines if One Line Fails
If you choose Yes, you can reject an entire Advance Shipment Notice (ASN) if any ASN line
fails validation or processing. If you choose No, then you can accept an ASN if at least one
ASN line is successful.
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Receiving Profile Options
Receiving
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RCV: Print Receipt Traveler

Yes or No indicates whether Oracle Purchasing automatically prints the receipt traveler when
you perform a receipt or a receiving transaction, and when you match unordered receipts. You
can always print receipt travelers from the Submit Requests window.
RCV: Processing Mode
Indicates the processing mode used after you save your work for receiving transactions.
PO: ERS Aging Period
The value in this profile option indicates the number of days between the receipt date and the
Payment on Receipt automatic invoice creation date. For example, a value of 2 means that
Payment on Receipt creates invoices only for receipts that are 2 or more days old. Any
corrections or returns you make against a receipt during that 2-day period are included on the
Payment on Receipt invoice.
PO: ERS Invoice Number Prefix
ERS- is the prefix that appears before all invoices that you create automatically using
Payment on Receipt. This profile option allows you to change this prefix. For example,
shortening this prefix allows extra spaces for longer packing slip or receipt numbers.
ASN and ASBN Electronic Receipts

Your supplier can provide ASN and ASBN transactions by way of EDI (e-Commerce
Gateway) or the Internet (XML Gateway). Both of these require implementation of the
appropriate Oracle product and setup of the supplier in the product as a trading partner. See the
Setup Options topic of the Purchase Orders module for slides describing how these products
integrate with Oracle Purchasing.
e-Commerce Gateway
The EDI Location Code must be set in the Supplier Site window and match that entered in the
Trading Partner window of Oracle e-Commerce Gateway. Since the gateway puts the incoming
transactions in the Receiving Open Interface, the Receiving Transaction Processor must be run
to update Oracle Purchasing. You can then view and receive against the shipping notices using
the receiving windows in Oracle Purchasing. See the Oracle e-Commerce Gateway
Implementation Manual for complete implementation details.
XML Gateway
Setup for XML shipping notices requires that both the supplier site and the trading partner have
EDI Locations defined. As with purchase orders the Workflow Agent Listener must be
running. Since the gateway puts the incoming transactions in the Receiving Open Interface, the
Receiving
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ASN and ASBN Electronic Receipts
Receiving Transaction Processor must be run to update Oracle Purchasing. You can then view
and receive against the shipping notices using the receiving windows in Oracle Purchasing. See
the Oracle Purchasing XML Transaction Delivery Setup Guide for complete implementation
details.
Receiving
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Agenda
Receiving
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Receiving
What methods of receiving will be most appropriate to use?
Will Blind Receiving be used?
How will the Receiving Transaction Processor be configured?
Will key suppliers record ASNs and ASBNs using Oracle iSupplier Portal?
Will receiving transactions be initiated from an external system like Scanning Devices?
Data mapping
How will your data mapping be done?
What data in legacy systems will determine values in Oracle Purchasing tables?
How will additional fields be derived and loaded?
Will any additional descriptive flexfields need to be set up?
Data cleanup
What receipts will be converted?
How will you handle conversion of goods received but not delivered?
Receiving
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Receiving
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Will you have automated conversion, manual data entry or both?

Report Mapping
Do Oracle standard reports meet your reporting requirements?
Who will perform report mapping?
Training and cutover
How will end-user training be conducted?
Who will conduct the training?
Who will create training materials?
Cutover
What are the cutoffs for entering data into the legacy system?
Whether and how long to maintain dual systems (legacy and new Oracle)?
Summary
Receiving
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Chapter 13
Purchasing Accounting
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Objectives
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Agenda
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Overview of the Procure to Pay Period Close

At the end of each accounting period, companies must complete the closing process in
Payables and reconcile Payables activity for the period.
You close a Payables period after you have completed accounting for transactions for the
period and you have transferred the accounting entries to general ledger.
A week before your first period close, create a copy of the production database and then do a
dry run following your period close procedures. The dry run will help you identify problems
and issues well in advance of the actual period close.
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Overview of the Procure to Pay Period Close
Close the PO Period Steps
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Close the PO Period Business Flow

Review the Uninvoiced Receipts report
The Uninvoiced Receipts Report should be run before the Receipt Accrual - Period-End
process. With this report, you can review all or specific uninvoiced receipts for both period end
and online accruals. Uninvoiced receipts are goods and services you have received that your
supplier did not invoice yet. This report indicates exactly what you have to accrue and for what
amount, and helps you analyze your receipt accrual entries. The accrual amount is the
difference between the quantity received and the quantity billed multiplied by the unit price of
the item.
Process period-end receipt accruals
Use the Receipt Accruals - Period-End process to create period-end accruals for your
uninvoiced receipts for Expense distributions. Purchasing creates an accrual journal entry in
your general ledger for each uninvoiced receipt you choose using this window. Each time you
create accrual entries for a specific uninvoiced receipt, Purchasing marks this receipt as
accrued and ignores it the next time you run the Receipt Accrual - Period-End process.
Purchasing creates accrual entries only up to the quantity the supplier did not invoice for
partially invoiced receipts.
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Close the PO Period Business Flow
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Once the Receipt Accruals - Period-End process completes, use Journal Import with a source
of Purchasing to import the journal into General Ledger. The journal is assigned a reversal
period based on the category setup. This journal must be reversed in the subsequent period and
posted. If the journal is not reversed and posted, your uninvoiced receipt liability will be
overstated.
Close the purchasing period
Use the Control Purchasing Periods window to control the purchasing periods defined in the
Accounting Calendar window. Purchasing lets you create journal entries only for transactions
you enter in an open purchasing period. Use the Control Purchasing Periods window to change
the status of the period to Closed. Once the Purchasing period is closed, the corresponding
Payables period cannot be re-opened unless the purchasing period is re-opened. Each period in
the purchasing calendar will have one of the following statuses:
Closed - When you close a purchasing period, Purchasing does not allow further accruals
during the period. Purchasing reverses the status of accrued purchase order lines that are
set to accrue at period end so that you can accrue them in the next period if you need to.
Future - Use this option if you want to open the purchasing period in the future. This
option is available only when the current status is Never Opened.
Never Opened - Purchasing displays this default status if you have not opened the period
in the past.
Open - Use this option to open the purchasing period.
Permanently Closed - Use this option if you do not want to re-open the period in the
future. This option is irreversible.
Process remaining inventory transactions
Process any remaining inventory transactions and close the inventory accounting period.
Run Accrual Rebuild Reconciliation Report
The Accrual Reconciliation Report can be used to analyze the balance of the perpetual receipt
accrual accounts (Inventory AP Accrual account). You only need to use this report if you are
accruing on receipt. For each Inventory AP Accrual account you can choose to order by item
or supplier and see detailed information including the purchase order number, receipt,
transaction quantity and transaction amount. You can review this report to identify the
following problems in receiving, purchasing, inventory, work in process, or accounts payable
transactions:
Mismatches in receipt and invoice quantities
Discrepancies in supplier billing
Invoices matched to the wrong purchase order
Receipts matched to the wrong purchase order
Miscellaneous transactions from Inventory or Work in Process that use the A/P accrual
accounts in error
Sales tax and freight charged to the A/P accrual accounts by mistake
For inquiries during the accounting period, use the Accrual Reconciliation report.
Write off accrued transactions as necessary
After you have researched the reported accrual balances, you can use the Accrual Write-Offs
window to indicate which entries you wish to remove and write off from this report.
Create a manual journal entry for write-offs

You can use the Accrual Write-Off Report as supporting detail for your manual journal entry.
Keep in mind that the best way to make corrections to fix discrepancies you identify is to
reverse invoice distributions and re-match to the correct purchase order.
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Agenda
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Key Accounts
Receiving Inventory Account
The Receiving Inventory Account is a clearing account. The account is used for perpetual (on
receipt) accruals. After receiving transactions are processed and the Transfer Transactions to
GL process is run, the Receiving Inventory Account is cleared and the Material account is
charged with the cost of the capitalized inventory. Specify this account when you define
Receiving Information for your inventory organizations.
Inventory AP Accrual
This is the account used by Purchasing to accrue your payable liabilities when you receive
items you will capitalize as inventory. This account represents your uninvoiced receipt liability
and is usually part of your Accounts Payable Liabilities in the balance sheet. Payables relieves
this account when the invoice is matched and validated. Specify this account when you define
Inventory Information for your inventory organizations in the Other Accounts tab.
AP Liability
This defaults from the supplier site and is credited when a standard invoice is entered or
debited when a credit memo or debit memo is entered. The account is relieved when the
invoice is paid.
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Key Accounts in Procure to Pay
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Expense AP Accrual
This is the account used by Purchasing to accrue your payable liabilities when you receive
items you will expense. This account represents your uninvoiced receipt liability when you run
the Receipt Accruals - Period End process. Specify this account on the Accrual tab when you
set up Purchasing Options.
Material
An asset account that tracks material cost. For average costing, this account holds your
inventory and in transit values. Once you perform transactions, you cannot change this
account. Specify this account when you define Inventory Information for your inventory
organizations in the Valuation Accounts region for the Costing Information tab.
Charge Account
This is the charge account is the account that will be charged for the purchase on either the
balance sheet or income statement. If the destination type for the distribution is Inventory, this
account will be the Material account associated with the subinventory and you cannot override
it. This is the balance sheet account that will be charged after inventory is capitalized. If the
destination type is expense, you can specify this account (provided it isnt project related) and
override any defaults. This account will be either an asset clearing account that will be
included on the balance sheet or an expense account that will be included on the income
statement. This account is either created or specified when you create a purchase order.
Purchase Price Variance
This account is used to record differences between purchase order line price and standard cost.
The Purchase Price Variance is calculated when items delivered to inventory are costed. This
account is not used with the average cost method. For example, assume the purchase order line
price for an item was set at $10 per item but standard cost was set to $12 per item and you
purchased 10 items. The Purchase Price Variance would be $20. Specify the Purchase Price
Variance account when you define Inventory Information for your inventory organizations in
the Other Accounts tab.
Invoice Price Variance
The variance account used to record differences between purchase order price and invoice
price. This account is used by Payables to record the invoice price variance for inventory items.
For expense items, the account generator uses the charge account to record any invoice price
variance. For example, assume the purchase order line price for an item was set at $10 per item
but you were charged $12 per item and you purchased 10 items. The Invoice Price Variance
would be $20. Specify this account when you define Inventory Information for your inventory
organizations in the Other Accounts tab.
Accrual Accounting - Perpetual Accrual (On Receipt)

Enter purchase order (1)
When you enter a purchase order, accounts are created and stored with the purchase order
distribution. The accounts will eventually be used as a basis for creating accounting that is sent
to the general ledger. Creating a purchase order in and of itself generates no accounting that is
sent to the general ledger.
Receive (2)
When you accrue on receipt, processing a receiving transaction automatically sends a receipt
accrual to the general ledger. The Receiving Inventory Account is debited (quantity x purchase
order line unit price) and the Inventory AP Accrual account (uninvoiced receipts account) is
credited the same amount. Run the Journal Import process with a source of Purchasing to
create unposted journals in the general ledger.
Deliver and cost (3)
After delivering to the final destination, the Receiving Inventory Account is cleared and the
Material account is debited. If you use standard costing, the Material account is debited with
the standard cost of the item and any difference is charged to the Purchase Price Variance
account.
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Accrual Accounting Perpetual Accrual (On Receipt)
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Period end accrual (4)

When items are accrued on receipt, no period-end accrual is generated by the Receipt Accruals
- Period-End process. The receipt accrual is automatically generated when the receipt is
processed.
Invoice and match (5)
Entering an invoice and matching creates a debit to the Inventory AP Accrual account to clear
the liability for the uninvoiced receipt (you now have an invoice). The credit is to the AP
Liability account that defaults from the supplier site if the invoice unit price is the same as the
purchase order line unit price. Any difference is charged to the Invoice Price Variance
account. For items with destination type of Inventory, the Invoice Price Variance account will
be the Invoice Price Variance account specified when you defined Inventory Information for
your inventory organizations in the Other Accounts tab. The AP Liability account is cleared
when the invoice is paid.
Accrual Reconciliation Process

To reconcile accrual accounts, you must:
Analyze the A/P Accrual Account Balance: You need to monitor potential problems
with purchasing and receiving activities that can affect the accuracy of your A/P accrual
accounts. You can use the Accrual Reconciliation Report to identify the following
problems in receiving, purchasing, inventory, work in process, or accounts payable
transaction
Use the Accrual Reconciliation Report: Use the Accrual Reconciliation Report to
analyze the balance of the Accounts Payable (A/P) accrual accounts. To submit this report,
you must have Purchasing and Payables installed. You can accrue both expense and
inventory purchases as you receive them.
Resolve Quantity Differences: The Accrual Reconciliation Report lets you identify
quantity differences (i.e., when the quantity received for a purchase order shipment is
smaller than the quantity invoiced). Such differences leave residual balances that never
clear from the A/P accrual accounts. You should investigate the cause of these differences
and take corrective actions before closing your period.
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Accrual Reconciliation Process
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Common causes of quantity differences include:

- Late inventory receipts: To correct late receipts, ensure that receivers enter all
receipts into inventory.
- Incorrect receipt quantities: To correct receipt quantities, enter receipt corrections.
- Supplier overbilling: To correct overbilling errors, follow your standard procedure
for supplier debit memos to clear the difference.
Resolve Price Differences: The Accrual Reconciliation Report lets you determine how
much you should have paid and whether the PO or invoice is correct. Such differences
leave residual balances that never clear from the A/P accrual accounts. You should
investigate the cause of these differences and take corrective actions before closing your
period.
Accrual Accounting - Periodic Accrual (Period End)

Receive (2)
When you process a receipt, no accounting is created for period end accruals. Receipts that are
accrued at period end will always be for a destination type of expense.
Deliver and cost (3)
When you deliver a receipt to its final destination, no accounting is created. The expense will
be recorded after matching to the purchase order, running the Payables Accounting process and
subsequently running the Payables Transfer to General Ledger process.
If an invoice is not entered by period end, the Receipt Accruals - Period End process will
generate accruals and transfer the accounting for them to the GL Interface. Use the Journal
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Accrual Accounting Periodic Accrual (Period End)
Chapter
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Import program to create unposted journals. This journal is created with a reversal date in a
subsequent period. The journal must be reversed so your receipt liability is not overstated.
Reverse accrual in the general ledger (5)
In the subsequent period, reverse the prior period accrual.
the liability for the uninvoiced receipt (you now have an invoice). The entire credit is to the
AP Liability account that defaults from the supplier site if the invoice unit price is the same as
the purchase order line unit price. Any difference is charged to the Invoice Price Variance
account. For items with destination type of Expense, the Invoice Price Variance account will
be the same as the charge account. The AP Liability account is cleared when a payment is
processed.
Accounting for Mass Additions - Periodic Accrual (Period End)

Receive (2)
For most expenses and asset purchases (other than inventory), receipt accruals are generally
processed at period end, so no accounting is transferred to the general ledger at the time the
receipt is processed.
If no invoice is received and matched to the purchase order at period end, the Receipt Accruals
- Period End process will generate an accrual that is transferred to the GL Interface. Run the
Journal Import process to create unposted journals in the general ledger.
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Accounting for Mass Additions Periodic Accrual (Period End)
Chapter
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Reverse accrual (4)

Perpetual accruals (on receipt accruals) are reversed when the invoice entered in Payables is
matched to the purchase order. Periodic accruals (period end accruals) are reversed when a
reversing journal is created and posted in the general ledger.
the liability for the uninvoiced receipt (you now have an invoice). The credit is to the AP
Liability account that defaults from the supplier site if the invoice unit price is the same as the
purchase order line unit price. Any difference is charged to the Invoice Price Variance
account. For items with destination type of Expense, the Invoice Price Variance account will
be the same as the charge account. In the case of an asset that will be capitalized and
depreciated in assets, the charge account is an asset clearing account associated with an asset
category in Assets. The AP Liability account is cleared when a payment is processed.
Post asset to Assets (6)
The Post Mass Additions process places the asset in service. When the Create Journal Entries
process is run in Assets, the charge account (the clearing account on the invoice distribution) is
relieved and the cost account associated with the asset category is charged for the cost of the
asset.
Accounting for Payments with Cash in Transit (Cash Clearing)

Enter invoice (1)
A standard, unmatched invoice entered into Payables will generate a credit to the AP Liability
account and a debit to the charge account specified on the invoice distribution. For expenses,
this will be an income statement account; for assets that will be capitalized in Assets and
depreciated, this account will be a balance sheet account (asset clearing account); for inventory
received, the account will be the Inventory AP Accrual account.
Pay invoice (2)
When using a cash clearing (cash in transit) account with Cash Management, usually the AP
Liability account is cleared when the payment is issued (however, it can be set to clear after the
payment is cleared using Cash Management).
Reconcile (3)
After reconciling the payment with Cash Management, the cash clearing account (cash in
transit) is relieved and the cash account associated with the payment document is credited. The
cash clearing account may be the same as the cash account, but using separate accounts gives
greater visibility to cash in transit on the balance sheet.
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Accounting for Payments with Cash in Transit (Cash Clearing)
Accounting for Payments without Cash in Transit (Cash Clearing)

Enter invoice (1)
A standard, unmatched invoice entered into Payables will generate a credit to the AP Liability
account and a debit to the charge account specified on the invoice distribution. For expenses,
this will be an income statement account; for assets that will be capitalized in Assets and
depreciated, this account will be a balance sheet account (asset clearing account); for inventory
received, the account will be the Inventory AP Accrual account.
Pay invoice (2)
When not using a cash clearing (cash in transit) account with Cash Management or not using
Cash Management, the AP Liability account is cleared when the payment is issued.
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Accounting for Payments without Cash in Transit (Cash Clearing)
Agenda
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Foreign Currency in Purchasing

In many businesses the environment is a global environment. One organization may purchase
goods and services from all over the world. Oracle Purchasing allows you to create documents
in a currency other than your defined functional currency. Your functional currency is defined
in your Set of Books.
You can create requisitions using multiple currencies other than your functional currency.
Every line you enter on a requisition can specify a different currency.
You can AutoCreate requisition created in one currency to a purchase order in a different
currency. (See above graphic example.)
Only one currency is allowed on a purchase order header.
You can choose from three types of foreign currency exchange rates.
You choose the date for your currency conversion.
In a non-budgetary control environment, requisitions do not make journal entries. However,
since approval rules are defined in your functional currency, the system requires conversion
factors to translate requisitions created with nonfunctional currencies to the functional
currency, so the approval analysis can performed.
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Foreign Currency in Purchasing
Exchange Rate Overview

In Oracle Purchasing you can specify three types of foreign currency exchange rates for you
requisition line or purchase order.
Spot
- Daily exchange rate you use to perform foreign currency conversion.
- Generally, a quoted market rate that applies to the immediate delivery of one currency
for another on a specific date.
Corporate
- Exchange rate that your organization specifies to perform foreign currency
conversion.
- Generally, a standard rate determined by senior management for use throughout the
corporation.
User-Defined
- Exchange rate specified by the buyer for the purchase order.
- The exchange rate is specified to be constant for the purchase order.
- You may create additional user-defined rate types.
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Exchange Rate Overview
Currency Similarities Between Requisitions and Purchase Orders

Specify a rate type and rate date. Also specify a rate for user-enterable rate types. For
automated rate types, Oracle Purchasing retrieves the rate based on the given rate date.
The exchange rate expressed the units of functional currency that comprise a single unit of
foreign currency. If 2 US Dollars (functional currency) equal 1 British Pound, set the
exchange rate to 2.
If the Journals: Display Inverse Rate profile option is set to Yes, the exchange rate
expresses the units of foreign currency that comprise a single unit of functional currency.
Chapter
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Currency Similarities Between Requisitions and Purchase Orders
Currency Differences Between Requisitions and Purchase Orders

Requisitions
Oracle Purchasing maintains requisitions in functional currency, but includes foreign
currency references for sourcing. The requisition total is expressed in functional currency
Specify a single foreign currency reference for each requisition line. Optionally, specify a
different currency reference for each requisition line. This currency cannot be changed
once you approve the document.
If you use the AutoSource function to create a foreign currency blanket agreement or
catalog quotation, Oracle Purchasing retrieves the foreign currency information for the
document.
Oracle Purchasing automatically updates the functional unit price if you enter the foreign
currency unit price using the specified rate. Oracle Purchasing also updates the foreign
currency price if you update the functional unit price.
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Currency Differences Between Requisitions and Purchase Orders
Purchase Orders
Specify a single foreign currency for each purchase order. This currency cannot be
changed one you approve the document.
If you change the currency on an unapproved document, Oracle Purchasing does not
automatically convert the line prices to the new currency.
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Requisitions and Automatically Created Purchase Orders Using Foreign Currency

You cannot specify currency information in AutoCreate if you are adding requisition lines
to an existing document.
Oracle Purchasing performs price tolerance verification for all currencies.
When you use the AutoCreate function to create new purchase order, Oracle Purchasing
converts the requisition price into a purchase order price based on specified currency and
rate information.
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Requisitions and Automatically Created Purchase Orders Using

Foreign Currency
Approving Requisitions and Purchase Orders Using Foreign Currency

Requisition Approval
You cannot approve a requisition that is missing a rate at the line level.
Oracle Purchasing uses the functional currency requisition total to verify authorization
limits.
Purchase Order Approval
You cannot approve a purchase order that is missing a rate at either the header or
distribution level.
Oracle Purchasing converts a foreign currency purchase order into functional currency to
verify authorization limits.
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Approving Requisitions and Purchase Orders Using Foreign

Currency
Invoice Currency Matching

Purchase Order Invoice Matching
The invoice and purchase order currency must match.
The Oracle Payables AutoApproval process books any differences between the invoice
and purchase order exchange rates to the Rate Variance Gain and Loss Account you
specify in the Financials Options window.
If you have a foreign currency purchase order, Payables also records exchange rate gains and
losses. In addition, if the conversion rate differs between the purchase order and invoice, the
conversion difference is recorded as an Exchange Rate Variance. Separate accounts are defined
for exchange rate gains and losses.
For more information, see Oracle Payables Users Manual.
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Invoice Currency Matching
Agenda
Chapter
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Reports
Accounts Payable Trial Balance
Use the Accounts Payable Trial Balance Report to verify that total accounts payable liabilities
in Payables equal those in the general ledger. To reconcile these balances you can compare the
cumulative total liability provided by this report with the total liability provided by your
general ledger.
Accrual Rebuild Reconciliation Report
Use the Accrual Rebuild Reconciliation Report to analyze the balance of the Accounts Payable
(A/P) accrual accounts. You can accrue both expense and inventory purchases as you receive
them. When this happens, you temporarily record an accounts payable liability to your Expense
or Inventory A/P accrual accounts. When Payables creates the accounting for the matched and
validated invoice, Payables clears the A/P accrual accounts and records the liability from the
supplier site. Run this report at period end.
Accrual Reconciliation Report
The Accrual Reconciliation Report is the same as the Accrual Rebuild Reconciliation Report
with one key difference. The Accrual Rebuild Reconciliation Report creates records in a
temporary table which are used as the basis for the report. The Accrual Reconciliation Report
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Reports
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simply uses the records created by the Accrual Rebuild Reconciliation Report as a basis for the
report. Run this report during the accounting period.
Accrual Write-Off Report
Use the Accrual Write-Off Report to provide supporting detail for your write-off journal
entries. The process is as follows. First, you analyze the Accrual Reconciliation Report for
transactions that you should expense out of the accrual accounts. After you have researched the
reported accrual balances, you then use the Accrual Write-Off window to indicate which
entries you wish to remove and write off from this report. And, after you have written off these
entries, you use the Accrual Write-Off Report as supporting detail for your manual journal
entry.
Matched and Modified Receipts Report
After you automatically create invoice distributions by matching an invoice for goods to a
receipt, that receipt can be modified in Purchasing. For example, you might need to adjust a
receipt because the quantity received was incorrectly recorded, or the product was defective
and returned to the supplier. Use this report to identify receipts that have been changed after
invoice matching, and for which no users have seen modifications.
Payables Account Analysis Report
Run the Payables Accounting report to review and analyze accounting entries in Payables.
You can use the report parameters to limit the report to just the accounting information you
want to review. The Payables Account Analysis report is helpful when you reconcile your
accounts with your general ledger. For example, you can reconcile the prepaid expense
account between Payables and your general ledger. You can submit this report in detail and
compare it to an account analysis report in your general ledger.
Reports
Payables Accounting Entries Report
Use this report to review and analyze accounting entries in the Payables subledger. You can
request the report for a specific run of the Payables Accounting Process or the Payables
Transfer to General Ledger program. Using the report parameters, you can produce a detailed
or summary listing of the accounting information you want to review. The report also lists in
detail any transactions that have been accounted with error and all entries that could not be
transferred to the general ledger interface. When a transaction is accounted with errors, use the
Update Accounting Entries window to update any invalid accounts.
Posted Invoice Register
Use the Posted Invoice Register to review accounting lines, summarized by invoice, that have
been transferred to the general ledger. Because it presents amounts that have been charged to
liability accounts, this report is valid only for an accrual set of books. The Posted Invoice
Register is primarily a reconciliation tool. Use this report along with the Posted Payment
Register and the Accounts Payables Trial Balance Report to reconcile balances between
Payables and your general ledger.
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Reports
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Posted Payment Register

Use the Posted Payment Register to review accounting lines, summarized by payments that
have been transferred to the general ledger. Because it presents amounts that have been
charged to liability accounts, this report is valid only for an accrual set of books. You can
submit the Posted Payment Register for one payment journal entry batch or all payment journal
entry batches. The Posted Payment Register is primarily a reconciliation tool. Use this report
along with the Posted Invoice Register and the Accounts Payables Trial Balance Report to
reconcile balances between Payables and your general ledger.
Receipt Accruals - Period End
Use the Receipt Accruals - Period-End process to create period-end accruals for your
uninvoiced receipts for expense distributions. Purchasing creates an accrual journal entry in
your general ledger for each uninvoiced receipt you choose using this window.
Receiving Account Distribution Report
The Receiving Account Distribution Report lists the accounting distributions for your receiving
transactions. This report supports the distributions created for the following transactions:
Purchase Order Receipts
Purchase Order Receipt Adjustments
Purchase Order Returns to Supplier
Deliver to Expense Destinations
Return to Receiving from Expense Destinations
Match Unordered Receipts
This report helps you reconcile your receiving accounting to your general ledger.
Reports
Unaccounted Transactions Report
Use this report to identify and review all unaccounted invoice and payment transactions and
see the reason that Payables cannot account for a transaction. Run this report after you have
run the Payables Accounting Process. The report will then show only transactions that had
problems that prevented accounting. You can then correct the problems and resubmit the
accounting process. Note that this report does not include invoices that have no distributions.
Uninvoiced Receipts Report
The Uninvoiced Receipts Report should be run before the Receipt Accrual - Period-End
process. With this report, you can review all or specific uninvoiced receipts for both period end
and online accruals. Uninvoiced receipts are goods and services you have received that your
supplier did not invoice yet. This report indicates exactly what you have to accrue and for what
amount, and helps you analyze your receipt accrual entries. The accrual amount is the
difference between the quantity received and the quantity billed multiplied by the unit price of
the item.
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Reports
Agenda
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Financials Options
(N) Setup > Organizations > Financial Options > (T) Accounting
Future Periods
The first time you enter this field, Payables displays the number of future periods you use in
your set of books as a default. You can change this number to the maximum number of future
periods you want to allow in Payables. Payables uses this value to limit the number of future
periods you can maintain in the Control Payables Periods window. You can import/enter
invoices in future periods, but Invoice Validation applies holds that prevent you from paying
them or creating accounting entries for them.
Liability
(N) Fin Options > Supplier > Supplier Site > Invoice
Payables assigns this account as the default Liability Account for all new suppliers you enter.
You can override this value at any level. If you use Accrual Basis accounting, then the
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Financials Options
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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 sites invoices. The Financials option
value defaults to new suppliers, and the supplier value defaults to new supplier sites. When
you enter a Prepayment type invoice, Payables will use the Prepayment account as the default
GL account for each Item type line you create.
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.
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 uses 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 calculates these amounts during
Invoice Validation.
Expenses Clearing
Payables uses this as a temporary account to record information about credit card transactions
imported from Self-Service Expenses using the Expense Report Import program. When you
import a credit card transaction, Payables creates a debit in this account. When payment for the
expense is remitted, Payables reverses the original entry by creating a credit for the same
amount.
Purchasing Options
(N) Setup > Organizations > Purchasing Options > (T) Accrual
Accrue Expense Items
At Receipt - Accrue expense items upon receipt. You can override this setting in the
Shipment Details window when you are entering purchase orders and releases.
At Period End - Accrue expense items at period end.
Accrue Inventory Items
At Receipt - Accrue inventory items at receipt. This is the only choice and it cannot be
changed.
Expense AP Accrual Account
Enter the default Expense AP Accrual Account.
Accrual Account Description
This is a display only field and is the concatenated description of the Expense AP Accrual
account segments.
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Purchasing Options
Payables Options
Payables Responsibility
(N) Setup > Options > Payables > (T) Accounting Methods
Primary Accounting Method
Accounting method you use for your primary set of books. You can specify either Accrual or
Cash. Although Primary Accounting Method is not a required field, you cannot create
accounting entries until you have entered a primary accounting method. Payables creates
accounting entries according to the accounting method you choose. Carefully consider these
settings at implementation time because you cannot change them after accounting events occur
(for example, after any invoice has been validated in your system).
Secondary Accounting Method
If you want to use combined basis accounting, choose Accrual or Cash for the accounting
method you use for your secondary set of books. If you do not want to use combined basis
accounting, choose None.
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Payables Options
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Automatic Offset Method

Enable Automatic Offsets by selecting Balancing or Account as your Offset Method if you
want Payables to automatically create balancing accounting entries for your invoice and
payment transactions. Carefully consider this option before setting it. Changing your automatic
offset setting after creating accounting entries can result in slower Payables Accounting
Process performance. Also, under certain circumstances, changing this setting can result in
accounting irregularities. Choose one of the following three options:
None - Do not use Automatic Offsets. For your invoice transactions, Payables creates one
liability accounting entry, and for your payment transactions, Payables creates one cash
type accounting entry.
Balancing - Payables uses the supplier sites default liability account and overwrites the
balancing segment (usually the cost center code) with the balancing segment from the
expense distribution GL Account.
Account - When creating the offsetting liability account, Payables uses the expense GL
Account from the invoice distribution and overwrites the account segment with the default
liability account from the supplier site.
Prevent Prepayment Application Across Balancing Segments
If you use Automatic Offsets, you can enable this option to prevent the application of a
prepayment amount to an invoice or expense report amount that is charged to a different
balancing segment.
Transfer to GL Tab
Transfer to GL Interface
Select the level at which you want to summarize accounting entries when you submit the
Payables Transfer to General Ledger program. If Payables creates summarized journal entries,
Payables combines all the invoice or payment transactions for a particular account or date into
a single journal entry line (for debits and for credits so they are not netted together). If you do
not create summarized journal entries, then Payables creates a journal entry line for each
accounting entry. It is usually not necessary to send accounting to the general ledger in detail.
In Detail - Do not summarize the entries.
Summarize by Accounting Date - Summarize the accounting lines by account and date.
Summarize by Accounting Period - Summarize the accounting lines by account and
accounting period.
Drilldown functionality is available from General Ledger regardless of the parameters in the
Transfer to General Ledger program. When accounting entries are transferred to the GL
Interface table, a link is automatically created. This means that full drilldown functionality to
the Payables accounting entries is always available from General Ledger, no matter what the
level of summarization.
Submit Journal Import
Enable this option if you want to submit journal import when you submit Payables Transfer to
General Ledger. Journal Import imports accounting entries from the GL Interface into General
Ledger.
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Allow Override at Program Submission

If this option is enabled, then when users submit the Payables Transfer to General Ledger
Process, they can change the defaults that you set in this region.
Currency Tab
Use Multiple Currencies
Enable this option if you want to enter and pay invoices in a currency different from your
functional currency. Payables also allows you to define a multiple currency payment format
and bank account if you enable this option.
Require Exchange Rate Entry
Require Exchange Rate Entry. Select this option to require entry of an exchange rate whenever
you enter an invoice or a payment in a currency other than your functional currency. If you
maintain daily rates in the Daily Rates window, Payables defaults the rate automatically, based
on the date and the Rate type you enter. Payables always requires you to enter an exchange rate
when you use the User exchange rate type, even if you do not enable this option.
Calculate User Exchange Rate
If you already know the functional currency amounts of any foreign currency invoices you are
entering, then you can enable this option so Payables can calculate and enter effective invoice
exchange rates for those invoices. This functionality applies to invoices you enter in the
Invoices window and invoices you import from the Payables Open Interface. If this option is
enabled, then when you enter a foreign currency invoice, if you select the exchange rate type of
User and you provide the functional currency amount, then Payables calculates and enters the
exchange rate.
Exchange Rate Type
Payables uses this as the default exchange rate type when you import/enter invoices or create
payments.
Realized Gain/Loss
Payables uses these accounts as the default realized gain and loss accounts for payments from
each of your bank accounts. If the exchange rate changes between invoice entry and payment,
Payables automatically calculates the realized gain or loss and records it in this account.
Payables records gains and losses only if you use accrual basis accounting. The Account for
Gain/Loss Payables option controls when Payables accounts for gains and losses.
Agenda
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Purchasing Accounting Implementation Considerations

Timing and frequency of running the Payables Transfer to General Ledger process
Determine how often to run the Payables Transfer to General Ledger process based on how
often you need to do financial reporting out of the general ledger, asset volume (how often will
you need to process mass additions) and how often you will need to see balances in Projects
updated. At a minimum, you must run this process one time at period close. If you need to see
Projects balances updated every day, you will run this process daily. If you are not using
Projects, but you are using Assets, you must run this process prior to running the Mass
Additions Create process. Therefore, if your asset volume is high, you will probably want to
transfer several times an accounting period.
Timing and frequency of running the Payables Accounting process
Since running the Payables Accounting process is a prerequisite to running the Payables
Transfer to General Ledger process, you must run Payables Accounting at least as many times
as you run the Payables Transfer to General Ledger. You may decide to run this process more
frequently (daily for example) if you want to be able to view accounting online.
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Purchasing Accounting Implementation Considerations
Chapter
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Timing and frequency of running the Invoice Validation process

Since running the Invoice Validation process is a prerequisite to running the Payables
Accounting process, you must run it at least as often as you run the Payables Accounting
process. The Invoice Validation process is also a prerequisite for processing payment batches,
so in order to determine how often to run the Invoice Validation process, look at both your
need to run Payables Accounting and your need to process payment batches. Choose the one
that will be done most frequently. The Invoice Validation process is also used to validate
invoices. It places holds on invoices and releases system holds. If you import/enter invoices
by batch, you may want to also run the Invoice Validation process by batch. The execution
report will give immediate feedback as to holds placed and released, which can provide more
timely information for resolving invoice issues.
Level of detail to transfer accounting to general ledger
Choosing the In Detail option transfers the most accounting to the general ledger and should
only be used when special general ledger reporting is necessary for financial statements. The
other two options summarize by day or by accounting period. Summarizing by accounting
period sends the least amount of detail to the general ledger. Regardless of the setting, you will
always be able to drill down to the subledger (provided the Import Journal References option is
selected with the journal source) with online inquiry, the Application Desktop Integrator (ADI)
and with the standard drilldown reports that are available.
Determine number of clearing accounts to use for projects, assets and cash management
If you are using cash management, the cash clearing (cash in transit) account can be the same
account as the cash account. You can use the Cash in Transit report in cash management to
view cash in transit. However, if you need to have visibility on the balance sheet for cash in
transit, use a separate cash clearing account. For each payables document you create, you can
have a separate cash clearing account if you need to.
Determine the number of clearing accounts you will need for assets. At a minimum, you can
establish one asset clearing account and at the maximum you can establish one asset clearing
account per asset category you create in fixed assets. Determining how many clearing
accounts you need will be based on asset volume and the need for visibility. You must balance
the need for mass addition reconciliation with additional account setup and maintenance.
Reconciliation is easier with more clearing accounts.
Determine the number of clearing accounts you will need for projects. Again, the issue is
primarily related to visibility, reconciliation and maintenance. Project clearing accounts are
built using workflow account generator. If you are using Projects, you must modify the
workflow to build the account combination for both Purchasing and Payables. Never build a
clearing account that Assets uses as a clearing account. You want to make sure that invoice
distributions associated with items that you want to capitalize in Assets go to Assets, and
invoice distributions associated with projects go to Projects.
Summary
Chapter
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Chapter 14
Purchasing Administration
Chapter
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Chapter
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Objectives
Chapter
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Agenda
Chapter
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Maintaining Your Oracle Purchasing Database Records

Records and documents you create on the database, such as supplier records, requisitions, and
purchase orders take up valuable space on the system. They slow your search for specific
records and increase your query time. This unit will provide three methods which can be used
together to assist you in freeing up valuable system resources.
Merging supplier records.
Mass canceling of documents.
Purging documents and suppliers.
Chapter
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Maintaining Your Oracle Purchasing Database Records
Integration with Payables

When Oracle Payables and Oracle Purchasing are used in conjunction they share the Supplier
Master. When a merge for suppliers has been initiated, Oracle Payables submits a concurrent
request to run the Supplier Merge Program which transfers the information from the Old
Supplier to the New Supplier and also runs the Purchase Order Header Updates Report and the
Supplier Merge Report.
Chapter
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Integration with Payables
What is MassCancel?
Document Type
Date Range
Supplier, for purchase orders
Accounting flexfields
Define MassCancel Listing
You can review the Define MassCancel Listing which includes all purchase orders or
requisitions that meet your criteria including those that you cannot cancel. For purchase orders
and requisitions that cannot be canceled, the Define MassCancel Listing reports the reason for
this restriction.
Running MassCancel
You review each saved cancellation batch and optionally delete batches that you do not want to
cancel. In addition, Oracle Purchasing requires individual document cancellation confirmation
within a batch to reduce the risk of unexpected or unwanted document cancellation. The
confirmed documents are canceled. MassCancel is recorded as the cancellation reason for each
document.
Chapter
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What is MassCancel?
Using Purchasing MassCancel

You can specify criteria for canceling groups of requisitions or purchase orders that you no
longer want to honor. Once you submit the criteria, you can review the a listing which includes
all request that meet your criteria, including those that you cannot cancel. You then review
each saved cancellation batch and optionally delete batches that you do not want to cancel.
You are required to confirm each individual document cancellation to reduce the risk of
unexpected or unwanted document cancellation.
Chapter
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Using Purchasing MassCancel
Reviewing the Define MassCancel Listing

Use the Define MassCancel Listing to review the purchase orders and requisitions you have
selected for cancellation using the Define MassCancel form. Oracle Purchasing prints this
report automatically after you define your purchase order or requisition cancellation criteria in
the Define MassCancel window and save your work.
The report is in four sections:
Unable to Cancel Requisitions
Unable to Cancel Purchase Orders
Partially in Range Documents
Fully in Range Documents
Chapter
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The Define MassCancel Listing
Purging
Purging is a technique for deleting data in Oracle that you no longer need to run your business.
You may choose to do a purge as a year-end clean up, or when a project is terminated. A
feature that Oracle Purchasing provides is to be able to purge by document category. You can
purge a particular group of records from the database. Oracle Purchasing lets you choose from
the following separate categories.
You enter purge criteria, specifying the document category you want to purge.
Review the Preliminary Purged Listings report and identify any purge candidates that you
do not want to purge.
You then confirm the purge information.
When you purge a document or supplier, Oracle Purchasing also purges related information.
You can restart the purge if your computer system fails or the purge process ends in an error.
In addition, you can abort a purge after you initiate the purge and before the Purge program
begins deleting records. However, if the Purge has one of the following statuses, you cannot
abort until the phase is completed: Initiating, Revalidating, Summarization.
Chapter
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Purge Overview
Oracle Purchasing maintains document and supplier summary information in the Purge
Summary Tables.
Chapter
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Prepare for a Purge

Write Off Accrual Differences
Run the Accrual Reconciliation report if you use online accruals or have Oracle Inventory
installed.
Write off all accrual differences up to the activity date you intend to use when running
Purge.
Failure to write off accrual differences will cause difficulty balancing the next run of the
accrual reconciliation report with your general ledger.
Prepare the Database
Back up and archive the Oracle Applications database.
Confirm the integrity of the backup for safety.
Create large rollback segments to prepare the database.
Chapter
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Preparing for a Purge
Purge Category Inclusion

Oracle Purchasing lets you choose from the following separate categories
Simple Requisitions
- Canceled and final closed requisitions that you have not placed onto purchase orders
Simple Purchase Orders
- Canceled, closed and final closed purchase orders that are not matched to invoices in
Oracle Payables
- Simple Requisition category
Simple Invoices (only available if you have Oracle Payables installed)
- Fully paid and posted invoices that are not matched to Oracle Purchasing orders
Matched Invoices and POs (only available if you have Oracle Payables installed)
- Canceled, closed or final closed purchase orders that are matched to fully paid and
posted invoices in Oracle Payables
- Simple Requisition category
Chapter
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Purge Category Inclusion
- Simple Purchase Orders category

- Simple Invoices
Suppliers
- Inactive suppliers that are not referenced on any document
You should purge all appropriate documents before purging your supplier information, because
Oracle Purchasing does not purge suppliers that you referenced on existing documents.
Chapter
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Conditions for a Purge: Purchasing

Oracle Purchasing only purges documents or suppliers that meet specific conditions.
Requisition Conditions for Purge
Header must be canceled for final closed.
Lines must be canceled or final closed or requisitions does not have lines.
Lines must all be supplier-sources. Internally sourced requisitions cannot be purged.
All lines that are not canceled or final closed must be referenced on purgeable purchase
orders. (This condition does not apply to the Simple Requisitions category.)
Purchase Order Conditions for Purge
Must be approved.
Must be closed, canceled or final closed.
If the PO is a blanket purchase agreement, all releases against the agreement must also be
purgeable.
If the document is a standard PO any contract it references must also be purgeable.
All online requisitions that reference a PO must be purgeable.
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Conditions for a Purge: Purchasing
The PO is not matched to any invoices. (This condition applies only to the Simple
Purchase Orders category.)
All invoices that are matched to the PO meet the purge conditions for invoices. (This
condition applies only to the Matched Invoices and Purchase Orders category.)
The PO is not referenced in Oracle Inventory, Oracle Master Scheduling/MRP, or Oracle
Work in Process.
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Conditions for a Purge: Payables

Invoice Conditions for Purge
Nonzero amount invoices must be fully paid.
Invoices must be posted.
Invoices cannot have any 1099 distributions.
Invoice is not from a recurring payment.
Invoice is not for a 1099 suppliers.
If Oracle Assets is installed, all of the invoice's distribution lines must be tested by
MassAddition.
A prepayment must not be applied to the invoice.
Payments must be posted.
An invoices is purgeable only when all of its payments are purgeable.
A payment is purgeable only when all of the invoices paid by the payments are purgeable.
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Conditions for a Purge: Payables
Supplier Conditions for Purge

Supplier is not an employee.
Supplier in inactive.
Supplier is a child or parent of another supplier.
Supplier is not referenced to by records in any Oracle Payables, Oracle Purchasing or
Oracle Assets tables.
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Purge Reports
When you purge records, Oracle Payables automatically prints the following reports. You
cannot submit any purge report from the Submit Request window.
Preliminary Purged Listings
Final Purged Listing
Rejected Purged Listings
Final Purge Statistics Report
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Purge Reports
Restarting a Purge
If your computer system fails or the purge process ends in an error, you can restart the first
active action of the purge process.
In the Submit Purge window, query the purge.
Choose Restart. The purge program will restart the last action you choose: Initiate,
confirm or Abort.
Aborting a Purge
You can abort a purge after you initiate the purge and before the purge program begins deleting
records. If the purge has one of the following statuses, you cannot abort until the phase is
completed: Initiating, Revalidating, Summarization.
In the Submit Purge window, query the purge.
Choose Abort.
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Restarting or Aborting a Purge
Purge Summary Information

Oracle Purchasing maintains a summary of each document or supplier you purge. Oracle
Purchasing does not maintain any standard reports that reference summary data; however, it
does check these tables to ensure unique document numbering.
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Purge Summary Information
Primary Summary Data
Requisitions
Buyer
Creation Date
Purchase Orders
Invoices
Yes
Yes
Currency
Yes
Yes
Yes
Document Number
Yes
Yes
Yes
Document Total
Yes
Yes
Yes
Document Type
Yes
Yes
Invoice Batch
Yes
Invoice Date
Yes
Preparer
Yes
Yes
Purge Name
Yes
Yes
Release Number
Yes
Supplier
Yes
Yes
Yes
Yes
Yes
Supplier Number
Supplier Site
Suppliers
Yes
Yes
Supplier Type
Yes
Yes
Chapter
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This is a sample list of the primary data elements. Other columns are populated in the
appropriate history tables. Oracle Purchasing also maintains receipt, checks, and invoice
payment summaries.
Recommendations for Efficient Purging

To purge the most complete set of records, choose the matched invoices and POs category
first, then initiate a second purge for the suppliers category.
Submit a purge when users are least likely to update records in the database.
The purge process can take several hours to complete. You can more efficiently purge a
large number of records by submitting several smaller purges. On you first purge, set a
Last Activity Date that is far in the past and gradually increase the date with each purge.
Make sure that the databases rollback segments you create are large enough so that you
have sufficient memory to perform the purge.
Chapter
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Recommendations for Efficient Purging
Agenda
Chapter
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Start Concurrent Managers

Start the Receiving Transaction manager (Required)
Start the PO Document Approval manager (Required)
Chapter
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Start Background Processes

Schedule the Send Notifications for Purchasing Documents process (Required)
The Send Notifications for Purchasing Documents process starts the workflow process that
sends notifications about purchase documents.
Schedule the Workflow Background Process (Required)
The Workflow Background Engine must be running if you are using the following options:
Background mode for purchasing approvals (as specified by the PO: Workflow Processing
Mode profile)
The Timeout feature in any workflow. The Timeout feature sends reminder notifications
The Background mode for the item attribute Send PO Autocreation to Background in the
PO Requisition Approval workflow. When the PO Create Documents workflow is
submitted, if the item attribute Send PO AutoCreation to Background is set to Y,
document creation will occur in Background mode.
Start the Purchasing Database Administration process (Required)
Use the Purchasing Database Administration process to initiate concurrent processes that purge
obsolete records in Purchasing interface tables and other temporary tables. The purging of
Chapter
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Schedule Background Processes
obsolete data helps reduce memory load and improve system performance. You need to run
this process only once because the AutoSubmit process resubmits itself daily after you submit
it the first time.
Fill Employee Hierarchy process
Run the Fill Employee Hierarchy process if you are using Position Hierarchies
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Schedule Other Processes

Retroactive Price Update
The Retroactive Price Update on Purchasing Documents concurrent program automatically
updates existing blanket releases and standard purchase orders retroactively with price changes
from the parent blanket agreement or global purchase agreement.
Printed Purchase Order
The purchase order print processes can be scheduled to automatically run. Some organizations
find this more efficient than on-demand processing.
The Confirm Receipts Workflow Select Orders
This is a process you submit through the Submit Request window. If you submit it, the
Workflow Background Engine must also be running.
Purchasing Database Administration
This process is used to initiate concurrent processes that purge obsolete records in Oracle
Purchasing interface tables and other temporary tables. This process will delete records from
the following tables:
PO_NOTIFICATIONS (Delete all the expired notifications)
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Schedule Other Processes
RCV_LOTS_INTERFACE (Unsaved/Unprocessed interface records)

RCV_SERIALS_INTERFACE (Unsaved/Unprocessed interfaced records)
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Agenda
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Purge: Issues to Consider

Purging is a technique for deleting data in Oracle that you no longer need to run your business.
You may choose to do a purge as a year-end clean up, or when a project is terminated. You can
control the purge by restarting the purge in the event of a system failure attempt. You can also
abort a purge before the the deletion process begins.
1. Naming conventions
- How will you name purge and mass cancel batches?
2. Access and control
- Who will have access and control to perform merging of suppliers, mass canceling of
documents and purging of data.
3. Frequency
- Will you have regularly scheduled maintenance jobs?
- If not scheduled regularly, how will individual jobs be scheduled and authorized?
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Purge: Issues to Consider
4. Integration issues
- Since database functions affect inquiry data, requirements of all the data users must
be considered.
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Summary
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Chapter 15
Appendix A - Setup Steps
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Objectives
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Agenda
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Setting Up Purchasing
The following setup steps are basic setups. One person or a large team of people working
concurrently may perform setups. In an implementation, common application setups are
generally performed first, followed by shared setups for each product family (procure to pay,
order to cash) and finally application specific setups.
The intent of this module is to provide a setup overview to key setup tasks and the sequence in
which they should be performed. Some of the steps included here may have already been
performed while implementing other Oracle Applications. For more information, refer to the
Oracle Purchasing Users Guide.
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Setting Up Purchasing
Set Up System Administrator (Required)

Create one or more users who will be performing setup tasks and assign them the required
setup responsibilities. In a small implementation, one user could perform all setups so assign
all of the required responsibilities to that user. In a larger implementation, create users and
assign the appropriate responsibilities to them. You do not need to assign an employee to a
responsibility at this time.
You will assign the following responsibilities:
General Ledger Super User - Define set(s) of books
System Administrator - Set system profile options, create responsibilities, set up printers
and other system administration related tasks.
Payables - Perform payables related setups
Purchasing Super User - Perform purchasing related setups.
HRMS Manager - Set up employees, hierarchies, locations, and organizations. You do not
need this responsibility if Human Resources is not installed.
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Define Users for Setup Tasks
Note: If you are implementing multiple operating units, theres no need to assign the
Purchasing Super User or Payables Manager responsibility at this point in time. Wait to assign
them until the appropriate operating units are assigned to the responsibility.
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Define a Ledger (Required)

Define accounting key flexfields and Cross Validation rules. You may not need to perform this
step if you have already installed and set up Oracle General Ledger or performed a common
applications setup.
Prior to defining Period and Historical rates, you must use the System Administrator
responsibility to set the GL: Ledger Name profile option to the appropriate Ledger. Set this
profile option at the Responsibility level. You will also have to have at least one period with a
status of Open in the Ledger attached to your responsibility before you will be able to set up
Period and Historical rates.
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Define a Ledger
Define Human Resources Key Flexfields (Required)

You may not need to set up Human Resources key flexfields if you have already installed and
set up Oracle Human Resource Management Systems.
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Define Human Resources Key Flexfields
Set Address Style Default (Optional)

You can update country and territory information including the name, description, VAT
member state code, or address style for any of the more than 200 predefined countries or
territories. Address styles determine how locations and address styles are displayed on forms
and printed on documents like purchase orders and payments.
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Set Address Style Default
Define Locations (Required)

You are required to set up at least one location for now. You can set up the remaining locations
after you define inventory organizations and tax codes. You may need to revisit this step after
you set up organizations, if you want to link a location to an inventory organization. If you set
up default Ship-To and Bill-To locations now, they will be available to set as default values
when you define Financial Options. It is a good idea to set up Locations now; however the
setup can be performed any time from here forward.
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Define Locations
Define Organizations (Required)

You may not need to perform this step if you have already performed a commonapplications
setup.
Define business groups (BG)
You will need to set up at least one business group first or use the default business group. You
will need the Human Resources key flexfields to do this. A business group is a Human
Resources organization to which you assign employees. After creating your business groups,
use the System Administrator responsibility to set the HR:Business Group profile option. Once
youve done this, log out, then back in to the system, and continue defining the legal entities,
operating units and inventory organizations that will roll up to the business group attached to
the responsibility you use.
Ledger
Although the Ledger is not an organization, it is important to show that is a part of the
organization hierarchy. Legal entities you define are associated with one and only one Ledger.
Define legal entities (LE)
Set up your legal entities. Make sure you specify the Ledger that the legal entity rolls up to in
the Legal Entity Accounting window. To open the Legal Entity Accounting window, click the
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Define Organizations
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button labeled Choose. Click Others for your GRE/Legal Entity, then select Legal Entity
Accounting from the list of values. If you do not specify the Ledger here, you will not be able
to create and save operating units later! Legal entities provide flexibility for reporting,
especially statutory tax compliance reporting. For many Oracle reports, you can report across
operating units at the legal entity level. For example, you can run an Accounts Payable trial
balance at the legal entity level to have a consolidated Trial Balance for all operating units that
roll up into the legal entity. The legal entity generally becomes the balancing segment;
however, that is not always the case.
Define operating units (OU)
When operating in a Multi-Org environment, it is a good idea to create one operating unit and
perform the necessary setups for that operating unit. If you change your mind in the future, you
can add additional operating units fairly easily.
Note: If you are using multiple operating units, you must use the System Administrator
responsibility and run the Replicate Seed Data concurrent request for each additional operating
unit you define (the ADADMIN utility is used for the first one).
Define inventory organizations (IO)
Define at least one inventory organization. This is a required step regardless of whether or not
you will be managing inventory and processing receiving activities. You will need to specify a
master inventory organization when you set up Financial Options. Be prepared to specify the
following account combinations:
Material (defaults to new subinventories but you can override it)
Purchase Price Variance
Invoice Price Variance
Inventory AP Accrual
Sales
Cost of Goods Sold
Note: All Oracle Applications users access the system through a responsibility that is linked to
a security group and a security profile. The security group determines which Business Group
the user can access. The security profile determines which records (related to organizations,
positions and payrolls) the user can access within the Business Group.
For more information, refer to Using Oracle HRMS - The Fundamentals.
Create Responsibilities (Required)

Create the responsibilities youll need to perform setup. Each responsibility will be linked to a
business group and operating unit (if youre using them) and a Ledger. You do not need to
create all of your responsibilities at this time, just the ones that are necessary to perform system
setups.
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Create Responsibilities
Set Key Profile Options (Required)

The following profile options should be set prior to entering setups.
HR: Business Group
HR: Security Profile
GL: Ledger Name
HR: User Type
Printer
Concurrent: Report Copies
MO: Operating Unit
PO: Workflow Processing Mode
Note: Not all profile options are available to be set at all levels.
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Set Key Profile Options
Convert to Multi-Org (Required)

After creating your first operating unit, you will need the system administrator to run the
ADADMIN utility to convert to Multi-Org. This is only necessary for the first operating unit
you add. When adding additional operating units, use the System Administrator responsibility
and run the Replicate Seed Data process for each additional operating unit you create.
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Convert to Multi-Org
Set Up Descriptive Flexfields (Optional)

Set up descriptive flexfields now so you will be able to capture any setup data that must be
stored in a descriptive flexfield. For example, if you need descriptive flexfield information
stored with suppliers, the descriptive flexfield should be set up prior to entering suppliers.
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Set Up Descriptive Flexfields
Define Lookups and Codes (Optional)

If you need these lookup codes, create them now in the Oracle Purchasing Lookups window so
they are available when you specify default values for Financial Options.
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Define Purchasing Lookups and Codes
Define Payment Terms (Required)

Set up at least the default payment terms you will specify when you set up Financial Options.
You can delay this setup step but should complete it prior to entering suppliers. You will need
to perform this setup only one time even if you have multiple operating units.
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Define Payment Terms
Define Tax (Optional)

If you need to specify a default tax code when you set up Financial Options, set it up now.
Additional tax related setups may be performed later. If you have defined multiple operating
units, you will need to perform this step for each one.
For more information, refer to the Oracle Payables Users Guide.
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Define Tax
Define Freight Carriers (Optional)

Define freight carriers if you want to specify the freight carrier that a supplier should use on a
purchase document. You must perform this step for each inventory organization.
You select in Financials Options, the Ship Via field.
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Define Freight Carriers
Define Financials Options (Required)

Use the Financials Options window to set the following information:
Employee numbering
Position approval hierarchies option (whether to use position approval hierarchies)
Inventory organization
Business group (Make sure a business group is specified.)
Supplier numbering
Employee numbering
You must first use the Choose Ledger window to specify your primary Ledger before you will
be able to enter the Financial Options window. This step must be performed for each operating
unit.
The following account combinations should be set up in advance (if you have not enabled
dynamic insertion for your Ledger) or at least the segment values. Be prepared to enter the
following accounts:
Liability
Prepayment
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Define Financials Options
Discount Taken
In addition, be prepared to optionally enter the following accounts:
Future Dated Payment
PO Rate Variance Gain
PO Rate Variance Loss
Expenses Clearing
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Define Inventory Key Flexfields (Required)

Even if you do not use any of the above flexfields, you must still enable at least one flexfield
segment for each and compile them because Oracle Inventory transactions (such as the Define
Items window), inquiries, and reports require a frozen flexfield definition. The Stock Locator
flexfield is an optional flexfield. The rest are required.
Note: Define any Shorthand Aliases you want to use prior to compiling your flexfields. This is
an optional step.
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Define Inventory Key Flexfields
Set Up Shorthand Aliases (Optional)

Shorthand aliases are nicknames for key flexfield combinations. Users can choose from values
that are easily recognized to default key flexfield combinations. Using Shorthand Aliases can
sometimes speed data entry and increase accuracy. Shorthand Aliases are commonly defined
for long account combinations. Set the Flexfields: Shorthand Entry profile option to determine
when the list of values opens. For example, some users may not want the list of values to be
displayed when they enter a key flexfield that has a Shorthand Alias. You can enable them for
some users and disable them for others.
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Set Up Shorthand Aliases
Define Units of Measure (Required)

You may not need to perform this step if you have already installed and set up Oracle
Inventory or performed a common-applications setup. Initial definition is performed one time,
regardless of how many operating units you have.
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Define Units of Measure
Define Standard Attachments (Optional)

Define any standard attachments. After you define your standard attachments, you can
reference them on your documents. You can reference as many standard attachments from your
documents as you want. If you want a text attachment to print on a purchase document, make
sure you designate the usage for that attachment to be Supplier.
You can provide attachments at the header and line level for the following documents:
Requisitions
Standard and Planned Purchase Orders (also shipment level)
Blanket Purchase Agreements
Releases (header and shipment levels)
Contract Purchase Agreements (header level only)
RFQs
Quotations
Receipts (line level only)
Receiving Transactions (line level only)
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Define Standard Attachments
You can also provide attachments for your items. When you create an attachment, you
designate whether you want the attachment to be available to the supplier, receiver, approver,
or buyer. Or, you can designate that you want the attachment to appear to anyone who has
access to that particular document online.
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Define Item Attributes, Codes, and Templates

Item Attribute Controls (Required with defaults)
Most item attributes default to Item Masterlevel control. The rest default to the Organizationlevel.
Container type QuickCodes (Optional)
Define container type QuickCodes.
Status codes (Required with defaults)
Define status codes. Default status codes include basic statuses such as Active, Inactive,
Obsolete, and Prototype.
Item type QuickCodes (Required with defaults)
Define item type QuickCodes. Default QuickCodes include Finished Goods, Option Class, Kit,
Purchased Item.
Item commodity codes (Optional)
Define customer item commodity codes. These can be used to group customer items.
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Define Item Attributes, Codes, and Templates
Item templates (Optional)

Define item templates. You can define an item template if many items share the same values
for multiple attributes.
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Define Category Sets and Category Codes

You may already have performed this step, if you set up Inventory.
Define Category Codes (Required)
Define category codes.
Define Category Sets (Required with defaults)
Define category sets. Examples of category sets are Inventory and Purchasing. Also, assign
each functional area (Purchasing, Inventory, and so on) a default category set.
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Define Category Codes and Category Sets
Define Catalog Groups (Optional)

A catalog group consists of descriptive elements for items to which you assign sets of values
such as type, size, or color. You may already have performed this step, if you set up Oracle
Inventory.
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Define Catalog Groups
Define Subinventories (Optional)

You can define your own subinventories such as Inspection, Cold Storage, or RejectDisposition. Subinventories are defined separately for each inventory organization.
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Define Subinventories
Define Cross-Reference Types (Optional)

Cross-reference types are links between inventory items and other pieces of information.
Examples of other pieces of information are old item numbers and supplier item numbers.
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Define Cross-Reference Types
Define Jobs, Positions, and Position Hierarchies

You might not need to perform this step if you have already installed and set up Oracle Human
Resource Management Systems or performed a commonapplications setup.
Define Jobs (Required)
Define jobs.
Define Positions (Optional)
You must define positions if you plan to use position hierarchies.
Define Position Hierarchies (Optional)
You can define one or more position hierarchies to meet your needs. You must define positions
if you plan to use Position Hierarchies. Make sure you run the Fill Employee Hierarchy
process after defining position approval hierarchies.
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Define Jobs, Positions, and Position Hierarchies
Define Personnel (Required)

You may not need to perform this step if you have already installed and set up Oracle Human
Resource Management Systems or performed a common applications setup.
If you use Oracle Purchasing without Oracle Human Resource Management Systems, use the
setup window from within Purchasing for defining employees. If you use Purchasing with
Human Resource Management Systems, use the setup window for defining employees from
within the Human Resource Management Systems application. Purchasing users must have
user names, which is a later setup step. These Purchasing user names must be linked to an
employee name.
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Define Personnel
Define Approval Groups and Assignments

This step needs to be performed for each operating unit.
Define Approval Groups (Required)
Once you have defined an approval group you can then use it to assign approval functions to
jobs or positions in the Approval Assignments window.
Assign Approval Groups (Required)
Approval groups will be associated with document types for either positions or jobs. If you are
using a position hierarchy, you will associate approval groups with documents added to
positions and if you are using an employee/supervisor hierarchy, you will associate approval
groups with documents added to jobs.
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Define Approval Groups and Assignments
Define Buyers (Required)

Use the Buyers window to define and maintain your buyers. Buyers can review all requisitions
using the Requisitions window, and only buyers can use the AutoCreate window to create
purchasing documents. You need to perform this setup step once for each Business Group you
define. You will only see buyers associated with your operating unit on many lists of values.
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Define Buyers
Document Types (Required)

Navigation: Set up : Purchasing > Document Types
Set up document types for each purchase document you will be using. This step must be
performed for each operating unit.
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Set Up Document Types
Define Lookup Codes and Classes
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Define Line Types (Required)

The default line types that Purchasing provides include Goods, Services, and Outside
Processing. Oracle Purchasing comes with one line type defined and you must set up any
additional line types you want to use. Perform this step once, regardless of how many operating
units you have. Create additional Line Types prior to defining Purchasing Options in case you
want to specify one as a default Line Type.
Note: These Line Types are used by Oracle iProcurement as well as Oracle Purchasing.
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Define Line Types
Define Purchasing Options (Required)

Define Purchasing Options for each operating unit. Be prepared to provide the following
account:
AP Expense Accrual Account
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Define Purchasing Options
Define Receiving Options (Required)

Define Receiving Options. This step needs to be performed for each inventory organization.
Use the Change Organization function in the Purchasing menu to switch inventory
organizations.
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Define Receiving Options
Set Address Style Default (Optional)

You can update Country and Territory Information including the name, description, VAT
member state code, or address style for any of the more than 200 predefined countries or
territories. Address styles determine how locations and address styles are displayed on
windows and printed on documents like purchase orders and payments.
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Set Address Style Default
Define Suppliers (Required)

Set up suppliers any time from this point forward. Suppliers are set up only once but supplier
sites are set up for each operating unit.
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Define Suppliers
Set Up Credit Card Programs (Optional)

You only need to perform this step if you are using procurement cards. This step must be
performed separately for each operating unit.
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Set Up Credit Card Programs
Define Items (Optional)

This step needs to be performed for each inventory organization and involves the following
tasks:
Define items at the master level.
Update the default categories assigned to the items.
Assign items at the organization level.
Define item relationships.
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Define Items
Modify Account Generator (Optional)

The Account Generator process in Oracle Purchasing builds a charge, accrual, and variance
account for each purchase order, release, and requisition distribution based on the distributions
Expense, Inventory, or Shop Floor destination type. Budget accounts are built only if you are
using Encumbrances. You must review the default process that Purchasing uses to see if it
meets your accounting requirements. You can optionally customize the Account Generator to
build the accounts differently if that is a business requirement. If you are using Projects, you
must modify the Purchasing and Payables Account Generator workflows. There are no defaults
to build project-related accounts.
Note: Account Generator workflows can be modified by Ledger
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Modify Account Generator
Set Up Workflow (Required)

If you will be using the PO Create Documents workflow to automatically generate standard
purchase orders and blanket purchase agreement releases, verify the settings of the following
attributes:
Is Automatic Creation Allowed?
Should Workflow Create the Release?
Should Contract be used to AutoCreate Doc?
Is Automatic Approval Allowed?
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Set Up Workflow Options

Start the Receiving Transaction manager (Required)
Start the PO Document Approval manager (Required)
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Start Background Processes (Required)

Schedule the Send Notifications for Purchasing Documents process (Required)
The Send Notifications for Purchasing Documents process starts the workflow process that
sends notifications about purchase documents.
Schedule the Workflow Background Process (Required)
The Workflow Background Engine must be running if you are using the following options:
Background mode for purchasing approvals (as specified by the PO: Workflow Processing
Mode profile)
The Timeout feature in any workflow. The Timeout feature sends reminder notifications
The Background mode for the item attribute Send PO Autocreation to Background in the
PO Requisition Approval workflow. When the PO Create Documents workflow is
submitted, if the item attribute Send PO AutoCreation to Background is set to Y,
document creation will occur in Background mode.
The Confirm Receipts Workflow Select Orders process.
This is a process you submit through the Submit Request window. If you submit it, the
Workflow Background Engine must also be running.
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Schedule Background Processes
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Start the Purchasing Database Administration process (Required)

Use the Purchasing Database Administration process to initiate concurrent processes that purge
obsolete records in Purchasing interface tables and other temporary tables. The purging of
obsolete data helps reduce memory load and improve system performance. You need to run
this process only once because the AutoSubmit process resubmits itself daily after you submit
it the first time.
Fill Employee Hierarchy process
Run the Fill Employee Hierarchy process if you are using Position Hierarchies
Activate Periodic Alerts
If you are using any of the standard Purchasing alerts (Notification Controls assigned to
blanket purchase agreements, for example) use the Alert Manager responsibility to activate the
appropriate alerts.
Schedule other processes
Schedule other processes including:
Purchase order print processes
Workflow Agent Listener
Set Up Sourcing Rules and Assignments (Optional)

You can set up Purchasing to automatically default source document information from a
blanket purchase agreement or catalog quotation onto a requisition or purchase order line for a
particular item and supplier. Or you can default just a supplier and optionally a supplier site.
You can set up automatic sourcing now or at any time on an ongoing basis. Set up any
Approved Supplier Lists as well.
Note: Purchasing will choose to default the supplier with the highest allocation regardless of
rank.
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Set Up Sourcing Rules and Assignments
Open Accounting Periods
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Perform Additional System Administration (Optional)

Set up additional responsibilities, users and any printers you will be using.
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Perform Additional System Administration
Create Folders (Optional)

Create folders on key forms to:
Show fields that are not shown by default. If you dont see a field on a form that you think
should be there, try using Folder Tools to see fields that are hidden by default.
Hide fields that you do not need to enter data into and that you do not want to see. Note
that not all fields can be hidden.
Change column names on folders.
Sort records displayed in folders in different orders. For example, you can sort orders by
descending date to see the most recent orders first.
Save a query with a folder.
Change field lengths for columns in a folder.
Move fields that you seldom or occasionally use to the right so data entry personnel do not
needlessly tab through them.
You can use the System Administrator responsibility to administrate folders. You can have
specific folders default for different responsibilities or users. Set the Folders: Allow
Customization profile option to allow or prevent customization of folders.
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Create Folders
Note: Be careful with the positioning of dependent fields, in cases where:

Fields have default values
Fields have controls for later fields
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Agenda
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Reports
Employee Listing
Use this report to create a list of employees that meet criteria you specify.
Payment Terms Listing
Use the Payment Terms Listing to review a complete list of the payment terms you have
defined in the Payment Terms window.
Tax Names Listing
Use the Tax Names Listing to review rate and account information for tax names you defined
in the Tax Names window.
Tax Recovery Rules Listing
Use the Tax Recovery Rules Listing to review all the tax recovery rules and rates that you
defined in the Tax Recovery Rules window. The report lists all of the rates for each tax rule.
Buyer Listing
The Buyer Listing shows the buyer name, default purchasing category, ship-to location, and
effective dates of all buyers or a selected set of buyers. You can also use the report to isolate
buyers who are assigned to a category of procurement items.
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Reports
Financials/Purchasing Options Listing

The Financials/Purchasing Options Listing can be used to review the options set for your
system in the Financials Options and Purchasing Options windows. This report also displays
your receipt numbering options in the Receiving Options window, for each inventory
organization.
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Reports
Location Listing
The Location Listing shows internal organizations locations and addresses. Purchasing lets you
specify which locations you want to review: Ship To, Bill To, Office, Internal, and Receiving.
Use this report to isolate locations which are only for a specific function, such as locations
where receiving is permitted. This document can be used as a resource when entering purchase
order receiving locations.
Quality Code Listing
The Quality Code Listing shows inspection quality codes. You can use this listing to help
assign quality codes when inspections are performed.
Standard Notes Listing
The Standard Notes Listing shows your standard notes and their start and end dates.
Unit of Measure Class Listing
The Unit Of Measure Class Listing shows the classes of measurement you have defined. A unit
of measure class is a grouping of common units of measurement. For example, the standard
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Reports
measurement for distance is inch, yard, foot, or mile. Units of distance are assigned to the class
Distance. The units assigned to a class are reviewed in the Unit Of Measure Listing.
Unit of Measure Listing
The Unit of Measure Listing shows the unit conversions you have defined in the Unit of
Measure Conversions window. A unit of measure is assigned to a class.
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Agenda
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Profile Options (Required)

These are a few key profile options. Refer to product user guides for more complete lists.
PO: Set Debug Concurrent On
This profile option is used, usually by technical support staff only, for finding problems with
ReqImport. The default value is No. The user can view and update this profile option. It can
also be updated at the user, responsibility, application, and site levels.
PO: Set Debug Workflow On
This profile option is used, usually by technical support staff only, for finding problems with
Purchasing workflow processes. The default value is No. The user can view and update this
profile option. It can also be updated at the user, responsibility, application, and site levels.
PO: Workflow Processing Mode
Affects the performance of the Purchasing approval workflow processes:
Online - Completes an entire approval workflow process before letting you proceed to the
next activity, but provides you with an updated Status (for purchase orders) as soon as it
finishes.
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Profile Options (Required)
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Background - Enables you to proceed to the next activity while the approval process
completes in the background. When this profile option is set to Background, you must
start the Workflow Background Engine, which you access through the System
Administrator responsibility. It is recommended that you set this process to run frequently,
if you are using it for Background mode approvals.
PO: Write Server Output to File
Yes or No indicates whether log details are written to a flat file rather than to the standard
concurrent manager details log viewable through the View Log button in the Submit Request
window when running the Purchasing Documents Open Interface program.
Audit Trail: Activate
If you want to keep track of the changes made to your data by application users, you should set
up AuditTrail for the relevant tables. Defining AuditTrail for your site involves defining Audit
Groups, which are groups of tables and columns for which you intend to track changes. You
then define Audit Installations to instruct AuditTrail which ORACLE IDs you want to audit.
Finally, you run the Audit Trail Update Tables Report, which allows your AuditTrail
definitions to take effect.
Default Country
This is the default source for the Country field for all address zones and is used by the Flexible
Address Formats feature, the Flexible Bank Structures feature and the Tax Registration
Number and Taxpayer ID validation routines.
Profile Options (Recommended)

Folders: Allow Customization
Your system administrator controls whether you can create or customize a folder definition
layout in folder block.
MO: Operating Unit
Determines the operating unit associated with your responsibility.
Printer
You can select the printer which prints your reports.
HR: User Type
Use this profile option to limit field access when sharing HR and Payroll.
GL: Ledger Name
Specify your Ledger. This option also associates a Ledger with a responsibility.
Chapter
CLASSROOM
Profile Options (Recommended)
Profile Options (Review)

HR: Security Profile
Enter the security profile for the responsibility.This must be set up at responsibility level,
otherwise the default view all security profile is used. Using Standard HRMS security you can
only set up one security profile for a responsibility. Do not set this profile for Cross Business
Group responsibilities (like service centers).
HR: Business Group
Associate a business group with a responsibility.
Flexfields: Shorthand Entry
If shorthand flexfield entry is defined for your flexfield, you can use a shorthand alias to
automatically fill in values for some or all of the segments in a flexfield.
Flexfields: Open Descr Window
Controls whether a descriptive flexfield window automatically opens when you navigate to a
customized descriptive flexfield.
Flexfields: Open Key Window
Controls whether a key flexfield window automatically opens when you navigate to it.
Chapter
CLASSROOM
Profile Options (Review)
Concurrent Report Access Level

Determines access privileges to report output files and log files generated by a concurrent
program. This profile option can be set by a System Administrator to User or Responsibility.
For example, if you want all holders of a responsibility to see report output generated by a
holder of that responsibility, set the value to Responsibility.
Chapter
CLASSROOM
Profile Options (Overlooked)

Viewer: Text
The Viewer: Text profile option has been enhanced to allow you to send report output directly
to a browser window. Enter Browser in this profile option to take advantage of this feature.
Concurrent: Report Copies
You can set the number of output copies that print for each concurrent request.
Account Generator: Purge Runtime Data
Yes ensures that the Oracle Workflow data used to generate accounting flexfield code
combinations using the Account Generator is purged after the Account Generator has
completed. This profile option should always be set to Yes unless you are debugging the
Account Generator. Running the Account Generator with this profile set to No fills up the
workflow tables and slows performance.
Chapter
CLASSROOM
Profile Options (Overlooked)
Summary
Chapter
CLASSROOM

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Volume II - Student Guide

Copyright 2009, Oracle. All rights reserved.

R12 Oracle Purchasing Fundamentals Table of Contents

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R12 Oracle Purchasing

Copyright 2009, Oracle. All rights reserved.

Copyright 2009, Oracle. All rights reserved.

R12 Oracle Purchasing Fundamentals Table of Contents

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Procure to Pay Lifecycle Overview ................................................................................................................1-1

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Enterprise Structure Locations, Organizations, and Items ......................................................................3-1

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E-Business Suite Setup Practice ....................................................................................................................2-51

Document Security, Routing and Approval ..................................................................................................5-1

R12 Oracle Purchasing Fundamentals Table of Contents

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Purchasing Use of Supplier Information .......................................................................................................4-7

RFQs and Quotations......................................................................................................................................6-1

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Document Types - Approval Settings............................................................................................................5-18

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Approved Supplier Lists and Sourcing Rules ...............................................................................................7-1

Purchase Orders ..............................................................................................................................................9-1

R12 Oracle Purchasing Fundamentals Table of Contents

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Requisition Templates ...................................................................................................................................8-29

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R12 Oracle Purchasing Fundamentals Table of Contents

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Standard Purchase Order Line Reference Documents Tabbed Region..........................................................9-32

Automating Document Creation ....................................................................................................................10-1

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Important Purchasing Options .......................................................................................................................9-112

Professional Buyer's Work Center.................................................................................................................11-1

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Purchasing Accounting ...................................................................................................................................13-1

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Desktop Receiving in iProcurement ..............................................................................................................12-22

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Define Standard Attachments ........................................................................................................................15-27

Thorough knowledge of Oracle Applications

Working experience with procurement

Oracle Applications Foundations

How This Course Is Organized

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Oracle Purchasing Users Guide

System release bulletins

Installation and users guides