On Account Credits

These are the credits assigned to a customer’s account and not to any specific invoice. E.g.

Customer Kirton Bearings remits a payment of $100 , but the sum of amounts of all the invoices pending for this customer is $70, an on account credit of $30 can be created for this customer .

The on account credit can be created from the transactions window.

Navigation : Receivables Superuser > AR_NAVIGATE_GUI : Transactions

The on account credit created from this form can be applied to any invoice by Choosing Applications

Setting up Journal Approval

Journal Approval feature ensures that journal entries and batches are approved by appropriate management personnel before posting them to the account balances.

Oracle workflow is required to be setup which :

1. Controls and Monitors the approval process.
2. Sends notifications to journal batch preparers and approvers.

Before using this ,

1. Enable journal approval for your set of books.

Navigation : General Ledger Superuser :GL Super User Menu : Setup : Financials : Accounting Setup Manager : Accounting Setups > Update Accounting Options > Define and update the journal processing options for your ledger

2. Setup Journal Sources .

Navigation : GL Super User Menu : Setup : Journal > Sources

3. Setup Heirarchy.

Navigation : HRMS Responsibility > People > Enter and Maintain

4. Setup Approval Limits .

Navigation : GL Super User Menu : Setup : Employees > Limits

5. Setup Oracle Workflow

6. Set the two profile options Journals: Allow Preparer Approval and Journals: Find Approver Method.

Application Rule Sets

AR, Version R12

Navigation : Receivables SuperUser > AR_NAVIGATE_GUI : Setup : Receipts > Application Rule Sets

Receipts are applied to transactions. The transactions usually consist of  line items, tax, freight and finance charges or a combination of these. So here application rule sets determine how to apply these receipts ( how to distribute the receipt amount among the different lines).

Hence Application Rule sets let you specify how receivables reduces the balance of your open debit items when you:

1. Apply a receipt to an invoice or debit memo.
2. Run post quick cash.

The application rule can be assigned to the transactions through the Transaction type window or through the system options window.AR decides which rule to be used in the following order :

1. Transaction Type
2. System Option

Predefined rule sets :

1. Line First Tax after : It will first apply the payment to open line amount and then to the associated tax.The remaining (if any) is then applied in following order : Freight, Finance Charges.
2. Line and Tax Prorate : It will first apply to line and associated tax proportionately. The remaining (if any) is then applied in following order : Freight, Finance Charges.
3. Prorate all : It will apply the receipt amount proportionately to all the lines irrespective of line type

Setting Up new Rule :

1. Enter unique name and description
2. Enter the Sequence number of the rule, AR will apply the rules as per the sequence numbers.  Note : Overapplication rule is by default the last and cannot be modified.
3. Enter the application rule . Each rule will be based on one line type (for example, lines, freight, or charges). Note : Overapplication rule gets automatically assigned and it cannot be deleted.
4. The rule details region indicates the type of charge and tax handling of this rule.

Tax Treatments :

Prorate: The receipt amount will be applied proportionately to the line as well as tax.

Before : The amount will be applied to TAX before applying it to the line.

After : The amount will be applied after it is applied to the line.

5. Check rounding Correction box if you want to automatically adjust this line type to account for any rounding corrections

6. Finally click the Freeze box. Once the rule is frozen, it cannot be deleted or modified.

Receipt Classes

AR, Version R12

Navigation : Receivables Superuser >     AR_NAVIGATE_GUI : Setup : Receipts > Receipt Classes

The receipt classes determine the required processing steps for receipts top which you assign payment methods with this class.

For each receipt class , one can specify :

1. Creation Method
2. Remittance Method
3. Clearance Method

1. Creation Method :

    a. Automatic : Receipts with this receipt class can be created using the automatic receipt program.For automatic  Receipts, tick require confirmation box in order to confirm these receipts before they can be remitted

    b. Manual : Receipts using this receipt class must either be entered manually in the Receipts or QuickCash window, or imported into Receivables using AutoLockbox.

2. Remittance Method : This is required if you have selected the require confirmation check box. It determines the accounts that receivables uses for automatic receipts .

1. Standard: It uses the remittance account
2. Factoring : It uses the Factoring account
3. Standard and Factoring:In this you can specify either of these methods when creating remittance batches.
4. No Remittance : Receipts are not remitted

3. Clearance Method :

1. Directly: Choose this method if you do not expect the receipts to be remitted to the bank and subsequently cleared. These receipts will be assumed to be cleared at the time of receipt entry and will require no further processing.
2. By Automatic Clearing: Choose this method to clear receipts using the Automatic Clearing program.
3. By Matching: Choose this method if you want to clear your receipts manually in Oracle Cash Management.