AP / AR Netting allows you to select AP and AR invoices and create payments and receipts against each other.
The netting process creates a settlement batch that nets to zero. The netting process is driven by the agreement parameters and the batch parameters.
The agreement parameters are established when you create the agreement. The agreement dictates which customers, suppliers, AP invoice types, and AR transaction types will be selected during the netting process.
The batch parameters are established when you create a batch. The batch dictates which AP invoices and AR invoices are selected by comparing the transaction due date on the batch to the due dates on the invoices.
The table below lists the key parameters and how they interact with the AP and AR invoice
The criteria used to select AP invoices for netting are:
1. The AP Invoice Type must be listed in the Agreement’s “Payables Invoice Type”
2. The AP invoice must be validated
3. The AP Invoice must be approved
4. The AP Invoice has zero holds
5. The AP invoice scheduled payment due date is less or equal to the transaction due date on the settlement batch
6. The AP invoice vendor must be listed in the Trading Partners on the Agreement
7. If there is a site on the Agreement’s Trading Partner, then the AP invoice must also have that site
8. The AP invoice is not fully paid
9. The AP invoice must be in the same operating unit as the Netting batch
The criteria used to select AR invoices for netting are:
1. The AR transaction type must be listed in the Agreement’s “Receivable Transactions Type”
2. The AR invoice must be completed
3. The AR invoice date is less or equal to the transaction due date on the settlement batch
4. The AR invoice customer must be listed in the Trading Partners on the Agreement
5. If there is a location on the Agreement’s Trading Partner, then the AR invoice must also have that location
6. The AR invoice must have a balance
7. The AR invoice must be in the same operating unit as the Netting batch
You can create a Netting batch from the “Create Netting Batch” web page. At a minimum, you will need to enter the operating unit, the settlement date, a batch name, and the transaction due date. After you submit the batch, a concurrent program evaluates the eligible AP and AR invoices. If there eligible invoices for both AP and AR, the batch will return in a “Selected” status. You can review the selected invoices and update them if you wish. To submit the batch for “payment processing”, you will need to click the update button and then click the submit button. By submitting the batch, Oracle will generate a payment and a receipt for each AP and AR invoice.
AP/AR Netting: AP invoice must be approved validated and accounted
AP/AR Netting: Matching AP invoice to agreement
AP/AR Netting: Matching AP invoice to batch parameters
AP/AR Netting: Matching AR invoice to agreement
AP/AR Netting: AR invoice must be completed and accounted
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