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R12 Payments
Annette Dall, Principal Product Strategy Manager
 Agenda

• New Module in R12

• Disbursements
• Funds Capture
• Cross-function
• Upgrade
• SEPA payment format
• Summary
 Oracle Payments: New in Release 12

• Single point of integration, excluding Payroll

Transmit to Financial Institutions

Oracle Payables

Oracle Payments
Other applications

Print Payments
Oracle Receivables

© 2008 Oracle Corporation – Proprietary and Confidential

 Common Practices
Decentralized Payables and Payments

Invoice Entry Invoice Selection Payment Processing

Operating Unit Operating Unit Operating Unit

Vision Spain Vision Spain Vision Spain

Operating Unit Operating Unit Operating Unit

Vision Italy Vision Italy Vision Italy

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 Implement Global Best Practices
Decentralized Payables and Centralized Payments

Invoice Entry Invoice Selection Payment Processing

Operating Unit Operating Unit

Vision Spain Vision Spain

Shared Service Center

Operating Unit Operating Unit

Vision Italy Vision Italy

© 2008 Oracle Corporation – Proprietary and Confidential

 Implement Global Best Practices
Centralized Payables and Payments

Invoice Entry Invoice Selection Payment Processing

Shared Service Center

Shared Service Center Shared Service Center

Invoice
SpainInvoice
Italy

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Disbursements

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 Disbursement Process Before Release 12

• For each unique combination of payment method, currency, and

operating unit, there has to be a complete process and a
separate resulting batch
Oracle Payables Payment
Payment Build
User File

Select Invoices

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 Disbursement Process in Release 12

• Payment file is taken from an intermediary pool of built payments

so selection criteria no longer has to include payment method,
currency, and operating unit. Payment
File

Oracle Payables
Payment Build
User Pool of Built
Payments

Payment
File

Select Invoices

• Fewer files to transmit or print

© 2008 Oracle Corporation – Proprietary and Confidential

 Disbursement Process
Multiple Processes Behind the Scenes
• Selecting invoices to be paid
• Still occurs in Payables – selection based on business reasons for
payment like due date, discounts available, etc.
• Building invoices into payments
• Payments groups invoices within selection batches into payments
according to configurable attributes – like due date, or payment reason
• Building payments into payment instructions (files)
• Takes payments from the pool of built payments (regardless of which
Payment Process Request they came from) and aggregates them into
payment instructions
• Formatting the file
• Automatically kicked off at the completion of the payment instruction
creation process
• Printing or transmission

© 2008 Oracle Corporation – Proprietary and Confidential

 Payment Process Request (PPR)
New Payment Run Submission Template

Use Template

Payment Method

Legal Entities

Payment Currencies Operating Units

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 Enhanced Check Printing Process

• Check printing process changes

• Error recovery improved (reprinting from UI)
• Recording print results

• Enhanced check stock setup in Oracle Cash

Management aids printing in Oracle Payments
• Support for both preprinted and blank stock (laser checks)

© 2008 Oracle Corporation – Proprietary and Confidential

 Disbursement Configuration Options
Enhanced Payment Method
• User-extensible
• Combination of validations and usage rules enables
exception-based straight-through processing
• Configurable usage rules
• Based on operating unit, first party legal entity, transaction
type, and cross-border attributes (foreign or domestic currency
or payee)
• Configurable defaulting rules
• Expanded options from 11i
• Create efficient end-user experience

© 2008 Oracle Corporation – Proprietary and Confidential

 Disbursement Configuration Options
Payment Method Extensibility Example

Payment ELEC_US ELEC_FR

Method Code
Payment Electronic Electronic
Method Name
Usage Rule US OU only French OU only

Validations 1) Must have 1) Must have supplier

supplier bank bank account
account 2) Must have payment
reason code

• US and France users each see Electronic

payment method but validations are different

© 2008 Oracle Corporation – Proprietary and Confidential

 Disbursement Configuration Options
Understanding validations
• What is validated?
• Invoices
• Payments
• Payment Instructions
• When is it validated?
• Upstream: during invoice validation so Payables Clerk sees it
• Downstream: during payment build and/or payment instruction
creation, as appropriate
• Where are the validations?
• Set up on payment method or format

© 2008 Oracle Corporation – Proprietary and Confidential

 Disbursement Configuration Options
Payment Process Profile (PPP)

• Payment process profiles control processing

• Tie other setup together (payment method,
format, payment system, etc.)
• Control creation of payments and payment
instructions
• Specify formatting, printing, and transmission
behavior
• Control usage
• Automate report generation

© 2008 Oracle Corporation – Proprietary and Confidential

 Deriving the Payment Process Profile
Every Payment Needs a PPP

• For each invoice that is passed to Payments to

be paid, the system will determine which PPP is
appropriate:

1. From the originating PPR (entered by a Payables

user or defaulted from a template).
2. Derived from invoice attributes: payment method,
disbursement bank account, OU, currency (must be
exactly one meeting the conditions).
3. Custom code (Payments provides a hook)
4. Manually entered by user.

© 2008 Oracle Corporation – Proprietary and Confidential

 Disbursement Configuration Options
Tying it all together – PM and PPP in the process
• Payment method (PM) drives upstream validations and
which payment process profile is used
• Payment process profile (PPP) gives system direction
throughout the payment process

PM defaults or is PPP defaults or is

entered entered
Validations from Validations from Separate
Format Printer Positive Pay
format format remittance
advices

Invoice entered Invoices selected Invoices built into Payments built into Payment file File transmitted Auxiliary
and validated for payment payments payment file(s) formatted or printed reporting

Central bank
Payment creation
Validations reporting
rules Bank instructions Bank Transmission
(payment system) details

Payment file creation Payment

rules Instruction
Register

© 2008 Oracle Corporation – Proprietary and Confidential

 Oracle Payments Disbursements

Benefits

Configurable setup improve efficiency

Simplify user procedures

Improve straight-through processing

Lower cost of payment processing

© 2008 Oracle Corporation – Proprietary and Confidential

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Funds Capture

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 Funds Capture Process

Request Authorization Settlement Acknowledgement

• Upstream • Routing rules drive • Payments calls • Payments

products call how the payment system in automatically
Payments to transaction will be individual or batch queries payment
authorize processed and mode to request system for
transaction with which third party settlement acknowledgement
third party payment system of transaction
payment system will be used success

© 2008 Oracle Corporation – Proprietary and Confidential

 Funds Capture Configuration Options
Funds Capture Process Profile

• Controls transaction lifecycle in funds capture

process flow

• Rules manage various processes

• Authorization and validation
• Aggregation of settlements into batches
• Format and transmission

© 2008 Oracle Corporation – Proprietary and Confidential

 Funds Capture Configuration Options
Validations

Upstream Product Oracle Payments

Upstream Downstream
Shopping Validation Validation
Cart Checkout

Order
Authorization
Booking

Receipt
Settlement
Remittance

© 2008 Oracle Corporation – Proprietary and Confidential

 Funds Capture Configuration Options
Payee (Merchant)

Change from 11i:

Selection of Payee
used to be in calling
products

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 Funds Capture Configuration Options
Routing Rules

Change from 11i: Routing

rules used to determine
only Payment System
Account

© 2008 Oracle Corporation – Proprietary and Confidential

 Oracle Payments Funds Capture

Benefits

All setup done via setup screens

Easier implementation and maintenance

Consistent and seamless processing

Lower cost of payment

© 2008 Oracle Corporation – Proprietary and Confidential

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Cross-Function

© 2008 Oracle Corporation – Proprietary and Confidential

 Oracle Payments Dashboards

• Accounts Payable • Payments

Manager Administrator
Payables Payment Funds Disbursement
• Manage individual Dashboard Process Home • Manage payment
payment batches process across
Dashboards selection batches

Funds Captures
Process Home

• Payments Administrator
• Monitor settlement batch status

© 2008 Oracle Corporation – Proprietary and Confidential

 Dashboard Example

Tab structure
enables detailed
research

<Enter
Processes that
slide note>
require user
intervention

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 Bank Account Structure and Setup Changes

• Internal bank accounts are centralized in Cash

Management
• Legal entities own bank accounts – think Taxpayer ID Number

• External bank accounts (supplier and customer)

are centralized in Payments
• Centralization gives a single point of control for encryption and
masking

© 2008 Oracle Corporation – Proprietary and Confidential

 Secure Payment Data Repository

Oracle Applications

Payment Data Repository in Oracle Payments

• Encrypted Customer Bank Accounts, Credit Cards, Debit Cards
• Encrypted Supplier Bank Accounts

Masked values
************124

Applications
Applications
Applications

© 2008 Oracle Corporation – Proprietary and Confidential

 Advanced Formatting Framework

XML Publisher offers significant benefits for formatting

Data Sources XML Publisher Output Formats Destination

Publishing • Email
Engine PDF HTML EDI
XML RTF XML • Printer
Disbursements • Fax
Credit Card
• FTP
Payments • AS/2
Direct Debits Templates

Remittances Remittance
Checks
Advice

Fund EFT Payments

Business Transfers
User Payment
Credit Card
Reports
Auths

© 2008 Oracle Corporation – Proprietary and Confidential

 Advanced Formatting Framework
eText for Electronic Formats

© 2008 Oracle Corporation – Proprietary and Confidential

 Electronic Transmission Capability

• Seamless electronic processing from invoice

entry to transmission to bank
• Transmission protocol defines transmission
parameters:
• Out of the box: FTP, secure FTP, HTTP, HTTPs, AS2
• Transmission configurations give implementation-
specific values to the parameters in the protocol
• Transmission configurations are associated with
the Payment System Account (the entity
representing the relationship with the bank or
payment processor)

© 2008 Oracle Corporation – Proprietary and Confidential

 Multi-Org Access Control Uptake
All UI respects Security Profile

• For Disbursements
• Multi-OU Payments = NO
• Multi-OU PPRs = YES
• Multi-OU Payment Files = YES

• For Funds Capture

• Multi-OU Settlement Batch = YES
• Multi-OU Authorization/Settlement = NO

© 2008 Oracle Corporation – Proprietary and Confidential

 What About Subledger Accounting?

• Payment transactions pushed back to

Payables and Receivables

• Payables and Receivables do the

accounting

• Payments SLA uptake = NO (because

there is no accounting in Payments)

© 2008 Oracle Corporation – Proprietary and Confidential

 Oracle Payments Cross-Function

Benefits

Visibility and control

Sensitive information secured

Easy creation or update of payment formats

© 2008 Oracle Corporation – Proprietary and Confidential

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Upgrade

© 2008 Oracle Corporation – Proprietary and Confidential

 Prior to the upgrade

• Review the Best Practices (Metalink Note 580299.1)

• Review the R12 Upgrade: Functional Upgrade Impacts
Document for Oracle Payments (FINANCIALS) (Metalink
Note 734012.1 )
• Schedule time for training end users
• Set all check stocks to point to Oracle supplied formats
• Have somebody versed in BI Publisher
• Plan time to evaluate all custom check and electronic
payment formats

© 2008 Oracle Corporation – Proprietary and Confidential

 Configuration

• Setup and defaulting

• EFT process changed
• Do not use stocks
• No supplied formats for signature printer cartridges
• Remittance advice delivery

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 What if there are problems?

• Stay up to date on critical patches

(Metalink Note 557869.1)
• The Oracle eBusiness Suite Diagnostics
(Metalink Note 167000.1)
• Profile options: ‘FND: Diagnostics’ & ‘FND: Debug’
• About this page -> Bug Report
• Tracing

© 2008 Oracle Corporation – Proprietary and Confidential

 Oracle E-Business Suite Release 12
Resources
• Release 12 documentation via Oracle MetaLink (Note 394692.1)
• Upgrade process and tools required
• Number and types of tasks involved
• How your system and products will look in Release 12
• Best Practices for Adopting Oracle E-Business Suite, Release 12
(Note 580299.1)
• Release Update Packs 12.0.6 for Financials Available (Note
742890.1)
• Five Key Resources for Upgrading to E-Business Suite Release
12
• Oracle E-Business Suite Upgrade Resources Roadmap (Note 461705.1)
• Oracle Applications Upgrade Guide: Release 11i to Release 12
• Oracle Maintenance Wizard (Note 215527.1)
• Release 12 Install/Upgrade (OTN - Oracle Technology Network) Forum
• Best Practices for Securing E-Business Suite Release 12
(Note 403537.1)

© 2008 Oracle Corporation – Proprietary and Confidential 43

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Single European Payments

Area

© 2008 Oracle Corporation – Proprietary and Confidential

 SEPA Impact and Benefits

Before SEPA After SEPA

• National and local solutions • Common standards and

with different schemes, procedures
formats
• Removal of disparities in
• Different country cross border payments
implementations
• Minimum execution time
• Higher processing/ execution
time

© 2008 Oracle Corporation – Proprietary and Confidential

 SEPA Scope

• The single currency - Euro

• A single set of Euro payment instruments
• Credit Transfers
• Direct Debits
• Credit and Debit card payments
• Common standards and business practices
• Efficient processing infrastructure for Euro payments
• One harmonized legal basis

© 2008 Oracle Corporation – Proprietary and Confidential

 SEPA Release dates for 11.5.10 and 12

Customer Credit Customer Direct

Releases Transfer Initiation Debit Initiation
(pain.001.001.02) (pain.008.001.01)
(Planned)

EBS 11.5.10 September, 2008 Calendar year 2009

(Released)

EBS 12 November, 2008 Calendar year 2009

(from RUP 4) (Released)

© 2008 Oracle Corporation – Proprietary and Confidential

 SEPA Release Information
12.0.4 and beyond

• Please apply patch no. 7552541

• Transfer Of Information session for SEPA release 12
• Note 403349.1
• Chose the following path after login to Oracle University
• E-Business Suite > Financials > Oracle Financials > Payments
• Documentation
• Oracle Payments Note 748434.1
• Oracle Cash Management Note 564995.1

© 2008 Oracle Corporation – Proprietary and Confidential

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Summary

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 Summary
Disbursements Implementation

• Know thy payment method

• Know thy payment process profile
• Know thy payment formats and validations

…and you will be rewarded with seamless

straight-through processing

© 2008 Oracle Corporation – Proprietary and Confidential

 Summary
Funds Capture Implementation

• Know thy payees, including routing rules

• Know thy funds capture payment process

…and you will be rewarded with bountiful

revenue in the organization

© 2008 Oracle Corporation – Proprietary and Confidential

 R12 Must Read for Implementers
Don’t Wait for the Movie!

Payments Technical TOI

• 100% of Disbursements code is a change
from 11i

…and YOU will be rewarded with a

successful project!

© 2008 Oracle Corporation – Proprietary and Confidential

 Upgrade Recommendations
Steps to Remember

• Prepare for the upgrade

• Impact of the new features
• Train the users
• Test payment format internally and externally

© 2008 Oracle Corporation – Proprietary and Confidential

 Oracle Payments

• Flexibility and versatility

• Better operational efficiencies
• Improved streamlined processing

© 2008 Oracle Corporation – Proprietary and Confidential

 More Information Available to You
Accelerate your evaluation and planning
Oracle.com MetaLink: E-Business Suite R12 Information
Center and Upgrade Resources
http://www.oracle.com/ Alerts, Announcements, Documentation, Online
For collateral, webcasts, podcasts, Training (TOIs), Installation and Upgrade
partner network, solutions catalog, and more

http://search.oracle.com

Oracle University MetaLink: Advisor Webcast Program

Instructor-led Training Starting May 2007 50+ Live Webcasts on Release 12
MetaLink / Knowledge / Tools and Training / Training
(Web Seminars)
QUESTIONS
ANSWERS