When looking at the changes in R12, I noticed that Project Billing has new functionality around agreements – date effective funds consumption.  This new functionality helps relieve an old problem when you have multiple agreements associated with one project and you want to generate an invoice for a specific agreement.

How Project Billing Worked Before Date Effective Funds Consumption

The project accountants face a challenge when there is more than one agreement associated with the Oracle project. When creating your invoices, Project Billing uses the agreement which will expire first.  If the expiration date is not populated, the Project Billing will use the agreements in the order that they are entered.   This has been a complaint from many people because it was difficult to raise an invoice for a specific agreement. They would need to change the expiration dates to ensure the correct agreement was being used when billing specific cost and events.  An example of this would be change orders added to a project.  Say you have a project to build new office building.  You find that the city is requiring additional permits and you submit a change order to the customer.  He gives you a separate PO and wants you to bill him separately for the permit fees.  Since you have already entered the agreement for the office building into the system, Projects will want to use that agreement first.  The only way to make Projects use the permit’s agreement, is to change the agreements expiration date.

How Project Billing Worked After Date Effective Funds Consumption

Two more agreement attributes have been provided by Oracle in R12 and they will be used in the PRC: Generate Draft Invoice Program. The first attribute depicts the billing sequence number and the second is the agreement start date.
Now, the project account will find it easier to deal with the invoicing for a specific agreement. At the time of entering an agreement, the billing sequence field and the start date field are populated. The billing sequence number is used to order or re-order the agreement in which the lower number is used first. The Agreement Start Date is used to control from where to start using an agreement.

This functionality directs the invoicing system to use the effective dates associated with the agreement and the billing sequence of the agreements. With these new agreement attributes, it is possible to create the invoice associated with a specific agreement with the event without any hassle. The ambiguity while creating the invoice of Oracle project has vanished.

The delay in payment is never appreciated in any business. I think the old version was responsible for confusion and thus, your payment could get postponed. With the new features, organizations can manage projects with multiple agreements in a better manner.