AP/AR Netting

Netting
When a trading partner is both a customer and a
supplier, you may choose to offset open receivables
against open payables items.
Netting Agreements add trading partner terms as well as
deploying company controls.
A selection program automatically pulls information from
Oracle Receivables and Oracle Payables taking into
consideration discounts, late fees, and withholding taxes
prior to determining the final netting amount.
A review process and trading partner approval afford
further verification to support the netting event.

Per-Requisites
Setups Required for AP/AR Netting Define netting control account
Receivables System Options
Create bank- Netting Account flag to Yes
Receipt class -AP/AR Netting
Attach your bank account in this receipt class
Netting Batch Approver
Profile: Chargeable Subcontracting Enabled
Document sequencing for AP & AR
Netting Agreement

Receivables System OptionsEnable check box Allow Payment of Unrelated

Transactions

Netting Bank Account

Receipt Class
Creation Method AP/AR Netting

Attach Bank Account to Receipt Class

Profile Option: Chargeable Subcontracting Enabled

Yes- Only invoices that were matched to purchase

orders with outsourced assemblies would be selected by
the netting process.
No- Only invoices that were matched to purchase
orders without outsourced assemblies would be
selected by the netting process.
D- All eligible invoices will be selected for netting
irrespective of whether or not they are matched to
purchase orders.

Document Sequencing
Category
Receivables- AP/AR Netting
Payables- Netting payments

Netting Agreement
Payables -> Payment -> Netting
Receivables -> Receipt -> Netting

Entering Netting Batch

Request
Create Netting Batch
Settle Netting Batch
Netting Data Extract

Query Receipt

Query Payments
Note- No Payment Document is to be Attached