Oracle Applications: Oracle Payables To Projects Interface

Definition of AP to PA interface and its objectives

When you enter project-related supplier invoices in Oracle Payables, the Oracle Payables Invoices Summary or detail window invokes the Account Generator in real time. The Account Generator derives the Accounting Flex field values based on the project information that you entered in a similar way that Auto Accounting works in Oracle Projects processes. Oracle Projects then creates an expenditure item for each project-related supplier invoice distribution line in Oracle Payables.

You can adjust the supplier invoice expenditure items in Oracle Projects to transfer or split the items. Oracle Projects processes these supplier invoice adjustments using the Supplier Invoice Cost Account Auto Accounting function.

Attention: When you set up your rules to account for supplier invoice costs, you need to ensure that your assignments and rules in Auto Accounting and Account Generator derive the same values.

Objectives:

Objective of this is to reduce the revenue leakages and identify the expenditure type by project wise to ascertain the project profitability.

Departments Impacted

No	Activity	AP	PA
1	AP invoices booking by data entry operator. i) Billable Expenses ii) Non Billable Expenses to billable projects	Continues to do the same with additional activity of mapping, Projects, Sub-Task, Expenditure Type and Expenditure Organization.	Continues to do the same with additional activity of defining Non-labor bill rate, Transaction Control, Project and Sub Task End Date.
2	AP invoices booking by data entry operator. Non Billable Expenses to non billable projects	-No change-	-No change-

AP to PA Invoices

The AP to PA invoice interface feature can be used to facilitate the entry of the Supplier Invoice in AP module and transfer the cost to PA for project accounting.

Activity Preface

This activity is performed whenever invoice is to be created for a supplier.

Merits

1) All the billable expense will enter by project wise and it is easy to identify the expenses need to billed to customer.

2) Avoids the revenue leakages.

3) Avoids duplicate entries, once in AP and once in PA.

4) Easy to find out the project profitability

5) Estimation of future project becomes easy and better quote will be prepared in future.

Shortcoming in current application:

Once billable expenses is transfer to the PA module task wise, revenue need will be recognized to the extent of cost, we need to automate revenue reorganization for the mark-up% value.

Process Change

We use to enter the AP invoice and account the cost which is not transferred to project module. It hits the general ledger directly. It is very difficult to find out the whether these billable expenses are billed to customer or not and also it is very difficult to arrive the project profitability.

Now with this process change we are able to find the billable and non billable expense in the project and project profitability become easier. We are avoiding the revenue leakage also.

There will be no change for accounting in AP for Non billable expenses to Non billable projects.

Expenditure Type

1. Billable Expenses

2. Non Billable Expenses

Project Type

1 Billable Project (Contract Project)

2 Non – Billable Project (Indirect Project)

Scenarios

1 Billable Expenses to Billable Project.

2 Non Billable Expenses to Billable Project

3 Non Billable Expenses to Non – Billable Project

Prerequisites

1. Project No

2. Project Sub Task No

3. Billable to Customer –Yes/No

4. Expenditure Type

5. Expenditure Organization

With an AP to PA invoices interface, you can:

1. Specify the Batch Name.

2. Create Supplier Invoice under the Batch defined.

3. Enter the prerequisites in the invoice line level only.

Billable Expenses to Billable Projects

For the billable expenses to billable project which need to be billed to customer, we have to get the Project No and Billable Sub Task No for calculation of Revenue, with or without mark up. For such type of transaction, Non billable task should not be considered.

Non Billable Expenses to Billable Project

Supplier invoices for non-billable expenses associated with billable project, should not be billed to customer, Data entry operator of AP invoices should ensure to get the correct project number from the concerned AP invoice requestor. AP data entry operator should also borne in mind that Sub Task No should be always 9999999(Non-billable task). For such type of transaction, billable task should not be considered.

Non Billable Expenses to Indirect Project

For the non-billable expenses to indirect project, there will be no change for accounting in AP. This should be accounted as per the present process.

Entering Supplier Invoice in AP Module for first 2 scenarios

Enter the Invoice batch name

Navigation: Payables àInvoices àEntry àInvoice Batches

Enter the batch name and click on Invoices button

Enter the Invoice, Line details and click on Distribution

All the project related information will be updated in distribution line level. Enter the project, task and Expenditure details.

Expenditure Type based on nature of expenses and mode of delivery we have to select.

For Example:

Travel expenses : Travel Domestic or Travel International

Expenditure Organization: Vision Operation

Validate the Invoice

Create Accounting for Invoice

Once the all the supplier invoice is validated and created the accounting lines project module will accept the invoice by running the program.

To calculate the revenue in PA module, we need to define in the “Non-labor bill rate and Discount Overrides” for the project with the mark up % as shown below.

Nav: Projects àProjects à Search with Project Name and Open

If there is no markup%, enter value as “0”.

In the PA module following auto Run Program is scheduled:

No	Request Name	Schedule Time
1	PRC: Interface Supplier Costs	04.00 AM which will transfer the invoices from AP to PA
2	PRC: Generate Draft Revenue for a Range of Projects	06.00 AM which will recognize the revenue till date for range of projects for all the entity.