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Procure To Pay P2P Accounting Entries
Procure To Pay P2P Accounting Entries
Procure To Pay P2P Accounting Entries
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.
2. Receive
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.
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 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.
2. On Material Receipt
Receiving Accrual Dr
AP Accrual Cr
Inventory Dr
Receiving Accrual Cr
4. On entering invoice in AP
AP Accrual Dr
Accounts Payable Cr
5. On Payment
Cash/Bank Cr
Accounting Entries
Pick release:
Inventory Stage A/c…………………Debit
Inventory Finished goods a/c……..Credit
Ship confirm:
Cogs A/c ……………………………Debit
Inventory Organization a/c………Credit
Receviable:
Receviable A/c………………………Debit
Revenue A/c………………………Credit
Tax ………………..…………………Credit
Freight…………..….……………….Credit
Cash:
Cash A/c Dr…………………………Debit
Receivable A/c……………………….Credit
2. Enter a Receipt:
Go to Cost Management module and run Create Accounting concurrent program and that will generate the
accounting of receivings & Issuances.
For Inventory, Asset and Expense Items Receivings accounting entry is:
* Cost Management SLA module is used to create inventory accounting entries generation.
For Inventory, Asset and Expense Items Issuances the accounting entry is:
Inventory Item:
Dr: Inventory Valuation A/c
Cr: Inventory Receiving A/c
Expense Item:
Dr: Expense A/c
Cr: Inventory Receiving A/c
Asset Item:
Dr: Asset Clearing A/c
Cr: Inventory Receiving A/c
C - Oracle Payable:
Incase below type of items one more accounting entry happens in Oracle
After completing this document, you should be able to understand the accounting
entries generated by the system during procure to pay cycle.
ENTRY 01:
When Goods / Material Are In-Transit Or When We Receive Inventory, The Following
Accounting Entry Will Be Generated.
When the inventory is received at Receiving Organization then the above entry will be
generated. Receiving of Inventory can be made through Purchasing Responsibility as well
as Inventory Responsibility.
When Inventory Is Delivered To Sub Inventory Stores Then The Following Accounting
Entry Will Be Generated.
When the Inventory is delivered in the Stores this account will be hit in the Inventory
Organization click on the others button and then select the Inventory Information and
then choose the Costing Information tab and this account will be defined in the
Valuation Account region named as Material.
When We Book Liability At Invoice Level, The Following Accounting Entry Will Be
Generated.
At the Invoice Level when we book the liability the supplier liability account will be
credited.
ENTRY 04:
When Payment Is Made To Supplier, The Following Accounting Entry Will Be Generated.
Cash Clearing Account is defined in the Payables Responsibility while defining the banks.
Supplier Liability Account To define the Liability account in the Payables Responsibility click on Setups,
choose Options, click on Financials, and then select the Accounting tab.
Cash Clearing AccountTo define Cash Clearing Account click on Setups, choose Payments and then click
on Banks. After entering the required information in the main bank window click on the Bank Accounts
button. In the Bank Accounts region choose the Account Use Type Internal to show the GL Accounts.
Here we find the Cash Clearing Account.
ENTRY 05:
When Reconciliation Is Made In Cash Management, The Following Accounting Entry Will Be Generated.
Switch to the Cash Management Responsibility for Reconciliation purpose. When we made the
Reconciliation then the above Accounting entry will be generated.
Cash Clearing AccountTo define Cash Clearing Account click on Setups, choose Payments and then click
on Banks. After entering the required information in the main bank window click on the Bank Accounts
button. In the Bank Accounts region choose the Account Use Type Internal to show the GL Accounts.
Here we find the Cash Clearing Account.
Bank / Cash Account To define Cash Account click on Setups, choose Payments and then click on Banks.
After entering the required information in the main bank window click on the Bank Accounts button. In
the Bank Accounts region choose the Account Use Type Internal to show the GL Accounts.
Trigger "Pay on Receipt Auto Invoice" Concurrent (For View (Alt + V) > Requests > Submit India Local
8
Importing the Transaction from Purchasing to Payables) New Request Purchasing
Trigger “India - To insert taxes for Pay On Receipt” (To View (Alt + V) > Requests > Submit India Local
9
insert Taxes to Payables) New Request Payables
RG 23A Basic
RG 23A CESS
2 Claim Excise
RG 23A SH CESS
Vat Recovered
3 Claim VAT
Vat Interim Recovered
Misc. Excise
Misc. SH Cess
Misc. Vat