BR.

100 PURCHASING APPLICATION SETUP

ORACLE PURCHASING

Author :
Creation Date : 9th Feb 2016
Last Updated :
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Version : Draft 1.0

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Document Control

Change Record

Date Author Version Change Reference

9 th Feb 2016 Udhayan N 1.0 No Previous Document

Reviewers

Name Position

Distribution

Copy
Name Location
No.

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 Contents

Document Control...................................................................................................................ii

Scope of Setup Document – Purchasing...............................................................................5

Open Purchase Accounting Periods......................................................................................6

Define Position Hierarchies....................................................................................................7

Define Buyers............................................................................................................................8

Define Approval Groups.........................................................................................................9

Assign Approval Groups to Positions................................................................................11

Fill Employee Hierarchy.......................................................................................................12

Define Purchasing Lookups.................................................................................................13

Define Inspection Codes.......................................................................................................14

Define Document Types........................................................................................................15

Define Purchasing Options...................................................................................................19

Define Receiving Options.....................................................................................................21

Define Financial Options.......................................................................................................22

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 Open and Closed Issues for this Deliverable.....................................................................24

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Scope of Setup Document – Purchasing
Where relevant, the document also provides an overview of the significance of the set-up step that is being performed.

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Open Purchase Accounting Periods

Open accounting periods to record purchasing activity. Oracle Purchasing application create journal entries only for transactions entered in an open
Purchasing period. Also purchasing periods needs to be opened to create correct Receipt Accrual journal entries in the General Ledger, only if the Accrual
Option is perpetual. Use “Control Purchasing Periods” form to open or close Periods in Oracle Purchasing application.

Navigation: Purchasing Responsibility > Setup> Financials > Accounting> Control Purchasing Periods

Status Num Fiscal Year Period From Date To Date

Never Opened 7 2013 Jul-13 01-Jul-2013 31-Jul-2013

Open 6 2013 Jun-13 01-Jun-2013 30-Jun-2013

Note: Inventory accounting periods should also be opened before receiving of goods, to enter PO Receipts.

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Define Position Hierarchies
Use of define Position Hierarchy form to create position hierarchies in the organization for Purchase documents. Oracle Purchasing application
uses these position hierarchies to determine approval and forwarding paths for the documents along with the document access controls assigned
with various positions.

Navigation: Purchasing Responsibility >Setup>Personnel>Position Hierarchy

Name Primary Version Number Date From Date To

XX_PO_HIERARCHY No 1 01-JUL-2009 -

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Define Buyers
Only those Employees defined as Buyers, can create Purchase Orders and Releases, RFQs and Quotations in the system. Please note for making requisitions,
one does not need to be a buyer.

Navigation: Purchasing Responsibility >Setup>Personnel>Buyers

Buyer Category Ship-To Effective Effective

From: To:
Sabbagh
Amjad - - 22-JUN-2011 -
Mohammed - - 25-SEP-2011 -
Ali - - 02-APR-2013 -

After defining new buyers

1. Ensure that they have been included into the purchasing approval hierarchy
2. Run “Fill Employee Hierarchy” report.
3. Approval Groups and Rules have to be defined and assigned to new buyers as per the company’s authority manual. These activities will be carried
out by Purchasing System Administrator / Super User.

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Define Approval Groups

Define document control rules for approval groups for the organisation. Document control rules are used to set approval limits for various positions (and
thereby employees) for requisitions, purchase orders and releases. Approval controls can be defined based on document total, account range, location, item,
category range and item range.

In HAAD, the approval groups are defined based on the Document Total and Account Range. Separate control groups have been defined for Requisitions and
Purchase Orders which are further divided by the Positions to which these rules apply.

Navigation: Purchasing Responsibility >Setup>Approvals> Approval Groups

Name XX Procurement Head -

Enabled Yes -
XX Section Head Procurement
Description -
Approval Group for PO Approval
Object Document Total Account Range

Type Include Include

Amount Limit 2000000.00 2000000.00

Low Value - 04.000.0000.0000000.000000.0000

High Value - 04.zzz.zzzzz.zzzzzzz.zzzzz.99999.zzzzz

Inactive Date -

Name Upto AED 50,000 Approval Group -

Enabled Yes -

Description Upto AED 50,000 Approval Group -

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Object Document Total Account Range

Type Include Include

Amount Limit 50000.00 50000.00

Low Value - 00.0000.0000.0000.000000.0000

High Value - 04.zzz.zzzzz.zzzzzzz.zzzzz.zzzzz.zzzzz

Inactive Date - -

Inactive Date - -

Name Upto AED 50,000 Approval Group -

Enabled Yes -

Description Upto AED 50,000 Approval Group -

Object Document Total Account Range

Type Include Include

Amount Limit 50000.00 9999999999.00

Low Value - 00.0000.0000.0000.000000.0000

High Value - 04.zzz.zzzzz.zzzzzzz.zzzzz.zzzzz.zzzzz

Inactive Date - -

Inactive Date - -

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Assign Approval Groups to Positions

For each position in the organisation authorized to approve purchasing documents, specific control group needs to be assigned to individual document types.
Employees who are assigned to these positions acquire the authorization abilities assigned to these positions.

For any new position, which will be created in the future & assigned to the employee, approval groups need to be defined & assigned by the system
administrator. This will be required only if the new position will be part of the approval hierarchy & needs to take the approval action on any purchase
document.

Navigation: Purchasing Responsibility >Setup>Approvals>Approval Assignments

Effecti
Effective
Position Job Organization Document Type Approval Group ve To
Date from
Date
Senior Purchasing Administration.Su XX Group Approve Purchase Order XX Procurement Head 01-JAN- -
Officer.3002.Supply pply Chain.Senior 2008
Chain-Procurement- Purchasing Officer
SCPSPS(Sec)
Assistant Budget Administration.Fi XX Group Approve Purchase Order XX Section Head 01-JAN- -
Accountant.3001.Budget nance.Assistant Procurement 2008
& Cash-GA- Budget
FNBCGA(Sec) Accountant
Assistant Purchasing Administration.Su XX Group Approve Purchase Order XX Sr. Officer 01-JAN- -
Officer.3001.Supply pply Procurement 2008
Chain-Procurement- Chain.Assistant
SCPSPS(Sec) Purchasing Officer
Senior Purchasing Administration.Su XX Group Approve Standard Purchase Orders XX Procurement Head 01-JAN- -
Officer.3002.Supply pply Chain.Senior 2008
Chain-Procurement- Purchasing Officer
SCPSPS(Sec)
Senior Purchasing Administration.Su XX Group Approve Blanket Purchase XX Procurement Head 01-JAN- -
Officer.3002.Supply pply Chain.Senior Agreements 2008
Chain-Procurement- Purchasing Officer
SCPSPS(Sec)
Senior Purchasing Administration.Su XX Group Approve Blanket Releases XX Procurement Head 01-JAN- -
Officer.3002.Supply pply Chain.Senior 2008
Chain-Procurement- Purchasing Officer
SCPSPS(Sec)

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Fill Employee Hierarchy
Navigation: Purchasing Responsibility>Reports>Run> Fill Employee Hierarchy
Description: Linking Employee to Position, Job, Organization and Location

Note: On Adding or Deleting any Position from any of the Approval Hierarchies, Run the Fill Employee Report. This report compiles the Position Approval
Hierarchy and ensures that all the Documents are routed through the relevant positions. If this report is not run then the System is unable to route the
Documents through the Approval Hierarchy as it fails to recognize the various positions included/deleted from the Hierarchy

Report Name Remarks

Fill Employee Hierarchy Run this report to compile the Position Approval Hierarchy. Any change to the Hierarchy is ineffective until and
unless this report is not run.

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Define Purchasing Lookups

Navigation: Purchasing Responsibility >Setup>Purchasing>Lookup Codes

Purchasing uses lookup codes to define lists of values throughout the system. A lookup category is called a lookup type, and the allowable values for the
lookup type are called lookup codes.

Depending upon the Access Level (User, Extensible & System) one can add their own codes to those initially provided .

Effective Effective Dates

Code Meaning Description Tag Enabled
Dates From To
ACCEPT
Accepted with Accepted Purchase Order, changes are 28-AUG-
WITH - - Yes
changes present 2002
CHANGES
ACCEPTED Accepted All
Accepted All Purchase Order Terms - - - Yes
TERMS Terms
28-AUG-
OPEN Open Open - - Yes
2002
ON
On Schedule Purchase Order On Schedule - - - Yes
SCHEDULE
UNACCEPT
Unacceptable
ABLE Unacceptable Purchase Order Changes - - - Yes
Changes
CHANGES

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Define Inspection Codes
Navigation: Purchasing Responsibility >Setup>Purchasing>Quality Inspection Codes

Inspection codes are used to record the quality of the received goods.

Ranking Quality Code Description Inactive Date

10 Excellent Substantially Exceeds Quality Standard -
20 Above Average Exceeds Quality Standard -
30 Average Meets Quality Standards -
40 Below Average Below Quality Standards, but acceptable -
50 Unacceptable Below Quality Standards, not acceptable
60 Reject and Notify Serious Quality Problems, Contact Supplier

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Define Document Types
Navigation: Purchasing Responsibility >Setup>Purchasing>Document Types

Document Types are used to define the controls & data forwarding methods for each type of purchasing documents.

Document – Blanket Purchase Agreement

Type Name Document Type layout Contract Terms Layout

Blanket Purchase
Purchase Agreement Blanket Blanket Agreement Stylesheet Oracle Contract Terms Template
Agreement

Attributes – Blanket Purchase Agreement

Owner Can Approve yes Security Level Hierarchy

Approver Can Modify Yes Access Level View Only
Can Change Forward – To No Forward Method Direct
Can Change Approval Hierarchy No Archive On Approve
Approval Workflow PO Approval Default Hierarchy XX_PO_HIERARCHY
Workflow Startup Process PO Approval Top Process

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Document – Contract Purchase Agreement

Type Name Document Type layout Contract Terms Layout

Contract Purchase
Purchase Agreement Contract Contract Agreement Stylesheet Oracle Contract Terms Template
Agreement

Attributes – Contract Purchase Agreement

Owner Can Approve Yes Security Level Public

Approver Can Modify Yes Access Level Full
Can Change Forward – To No Forward Method Hierarchy
Can Change Approval Hierarchy No Archive On Approve
Approval Workflow PO Approval Default Hierarchy
Workflow Startup Process PO Approval Top Process

Document – Planned Purchase Order

Type Name Document Type layout Contract Terms Layout

Purchase Order Planned Planned Purchase Order - -

Attributes – Planned Purchase Order

Owner Can Approve Yes Security Level Public

Approver Can Modify Yes Access Level Full
Can Change Forward – To No Forward Method Hierarchy
Can Change Approval Hierarchy No Archive On Approve
Approval Workflow PO Approval Default Hierarchy -
Workflow Start Process PO Approval Top Process

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Document – Standard Purchase Order

Type Name Document Type layout Contract Terms Layout

Purchase Order Standard Standard Purchase Order Standard Purchase Order Stylesheet Oracle Contract Terms Template

Attributes - Standard Purchase Order

Owner Can Approve Yes Security Level Public

Approver Can Modify Yes Access Level View Only
Can Change Forward – To No Forward Method Hierarchy
Can Change Approval Hierarchy Yes Archive On Approve
Approval Workflow PO Approval Default Hierarchy XX_PO_HIERARCHY
Workflow Startup Process PO Approval Top Process

Document – Blanket Release

Type Name Document Type layout Contract Terms Layout

Release Blanket Blanket Release Blanket Release Stylesheet

Attributes – Blanket Release

Owner Can Approve Yes Security Level Hierarchy

Approver Can Modify Yes Access Level View Only
Can Change Forward – To No Forward Method Direct
Can Change Approval Hierarchy No Archive On Approve
Approval Workflow PO Approval Default Hierarchy XX_PO_HIERARCHY
Workflow Startup Process PO Approval Top Process

Document – Scheduled Release

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Type Name Document Type layout Contract Terms Layout
Release Scheduled Scheduled Release

Attributes – Scheduled Release

Owner Can Approve Yes Security Level Public

Approver Can Modify Yes Access Level Full
Can Change Forward – To No Forward Method Hierarchy
Can Change Approval Hierarchy No Archive On Approve
Approval Workflow PO Approval Default Hierarchy
Workflow Startup Process PO Approval Top Process

Document – Purchase Requisitions

Type Name Document Type layout Contract Terms Layout

Requisition Purchase Purchase Requisition - -

Attributes – Purchase Requisition

Owner Can Approve Yes Security Level Public

Approver Can Modify Yes Access Level Full
Can Change Forward – To Yes Forward Method Hierarchy
Can Change Forward – From No Default Hierarchy XX_REQ_HIERARCHY
Can Change Approval Hierarchy No Approval Workflow Requisition
Use Contract Agreements for Auto
No Workflow Startup Process Main Requisition Approval
Sourcing
Approval Transaction Type
Autocreate Workflow PO Create Documents
Autocreate Workflow Startup Overall Document Creation/Launch
-
Process Approval

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Define Purchasing Options
Navigation: Purchasing Responsibility>Setup>Organizations>Purchasing Options

Description: Use this form to set up your system Options. Oracle Purchasing lets you define specific categories of system Options when you enter one of the
following values in the Additional Purchasing Options field.

Document Control

Price Tolerance Percentage - Enforce Price tolerance -

Price Tolerance Amount - Enforce Price Tolerance Amount -
Enforce Full Lot Quantity Advisory Display Disposition Messages Yes
Receipt Close Point Received Notify if Blanket PO Exists Yes
Cancel Requisitions Always Allow Item Description Update Yes
PO Output Format PDF Enforce Buyer Name
SBI Buying Company
- Enforce Supplier Hold
Identifier
Maximum Attachment Size
10 Gapless Invoice Numbering -
(in MB)
Email Attachment Filename Attachments.zip RFQ Required -

Document Default

Requisition Import Group-By Vender Line Type Goods

Minimum Release Amount - Rate Type Corporate
Internal Requisition Order Type Internal Match Approval Level 4- Way
Internal Requisition Order Source XX Mixed Price Break Type Cumulative
Receipt Close Tolerance (%) - Price Type
Minimum Release
Invoice Close Tolerance (%) -
Amount (AED)
Quote Warning Delay 30

Receipt Accounting

Accrue Expense Items At Receipt

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Accrue Inventory Items At Receipt
Expense AP Accrual Account 04.103.00000.0000000.22004.00000.00000
Automatic Offset Method None

Document Numbering

Entry Type Next Number

RFQ Number Automatic Numeric 5
Quotation Number Automatic Numeric 1
PO Number Automatic Numeric 38560
Requisition Number Automatic Numeric 7737

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Define Receiving Options
The receiving options are defined as a part of Inventory Organisation definition in the Oracle Inventory module.
Navigation: Purchasing Responsibility>Setup>Organizations>Receiving Options

Enforce Ship-To None Allow Substitute Receipts Yes

ASN Control Action None Allow Unordered Receipts Yes
Receipt Days Early 10 Allow Express Transactions No
Receipt Days Late 10 Allow Cascade Transactions No
Receipt Days Exceed-Action NNone Allow Blind Receiving No
Over Receipt Tolerance (%) 0 Validate Serial Numbers on RMA Receipts No
Over Receipt Action RReject Interface to Advanced Pricing No
RMA Receipt Routing Direct Delivery Interface to Transportation Execution No
Receipt Routing Direct Delivery
Receipt Number Generation Automatic
Receiving Inventory Account 04.103.00000.0000000.12503.00
Receipt Number Type Numeric
000.00000
Next Receipt
71134 Retroactive Price Adjustment Account
Number

ValidateLots
on RMA 04.103.00000.0000000.12504.00
Restricted Clearing Account
Receipts 000.00000

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Define Financial Options
Navigation: Purchasing Responsibility>Setup>Organizations>Financial Options

<Accounting>
Future Periods 1
Liability 04.103.00000.0000000.21201.00000.00000
Prepayment 04.103.00000.0000000.12709.00000.00000
Future Dated Payment 04.103.00000.0000000.42001.00000.00000
Discount Taken 10.0000.0000.0000.320050.0000
PO Rate Variance Gain 04.103.00000.0000000.57001.00000.00000
PO Rate Variance Loss 04.103.00000.0000000.57001.00000.00000
Expense Clearing -
Miscellaneous -
Retainage --

<Supplier – Purchasing>
RFQ – Only Site No
Ship-To Location XX Hospital Main Inventory Organization
Bill-To Location XX Hospital
Inventory Organization XX - XX Hospital Inventory Organization
Ship Via -
FOB -
Freight Terms

<Encumbrance>
Use Requisition Encumbrance Yes
Reserve At Completion Yes
Use PO Encumbrance Yes

<Tax>
Member State -
VAT Registration Number -

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<Human Resources>
Business Group XX BG
Expense Reimbursement Address Home
Use Approval Hierarchies Yes
Employee Number – Method Manual
Next Automatic Number

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Open and Closed Issues for this Deliverable

Open Issues
ID Issue Resolution Responsibility Target Date Impact Date

Closed Issues
ID Issue Resolution Responsibility Target Date Impact Date

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