d53020

R12 Oracle iProcurement Fundamentals Student Guide Volume 1

D50792GC10

Edition 1.0

September 2007

D53020

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Copyright 2002, 2007, Oracle. All rights reserved. Disclaimer This document contains proprietary information and is protected by copyright and other intellectual property laws. You may copy and print this document solely for your own use in an Oracle training course. The document may not be modified or altered in any way. Except where your use constitutes "fair use" under copyright law, you may not use, share, download, upload, copy, print, display, perform, reproduce, publish, license, post, transmit, or distribute this document in whole or in part without the express authorization of Oracle. The information contained in this document is subject to change without notice. If you find any problems in the document, please report them in writing to: Oracle University, 500 Oracle Parkway, Redwood Shores, California 94065 USA. This document is not warranted to be error-free. Restricted Rights Notice If this documentation is delivered to the United States Government or anyone using the documentation on behalf of the United States Government, the following notice is applicable: U.S. GOVERNMENT RIGHTS The U.S. Governments rights to use, modify, reproduce, release, perform, display, or disclose these training materials are restricted by the terms of the applicable Oracle license agreement and/or the applicable U.S. Government contract. Trademark Notice Oracle is a registered trademark of Oracle Corporation and/or its affiliates. Other names may be trademarks of their respective owners.

Author

Richard Sears, Vic Mitchell

Technical Contributors and Reviewers

Barbara.Snyder, Sharon Tennier

This book was published using: oracletutor

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Copyright Oracle, 2007. All rights reserved.

R12 Oracle iProcurement Fundamentals Table of Contents i

Table of Contents

Procure to Pay Lifecycle Overview ................................................................................................................1-1 Procure to Pay Lifecycle Overview...............................................................................................................1-3 Objectives ......................................................................................................................................................1-4 Procure to Pay Lifecycle................................................................................................................................1-5 Oracle Procure to Pay Process.......................................................................................................................1-7 Demand: Requisitions....................................................................................................................................1-9 Source: RFQs and Quotations .......................................................................................................................1-11 Suppliers ........................................................................................................................................................1-13 Purchase Orders.............................................................................................................................................1-15 Receiving.......................................................................................................................................................1-17 Invoicing........................................................................................................................................................1-19 Payment .........................................................................................................................................................1-20 Overview of Oracle Application Integration .................................................................................................1-21 Summary........................................................................................................................................................1-23

Understanding Oracle iProcurement.............................................................................................................2-1 Understanding Oracle iProcurement..............................................................................................................2-3 Objectives ......................................................................................................................................................2-4 Procure to Pay: Oracle iProcurement.............................................................................................................2-5 Agenda...........................................................................................................................................................2-6 Oracle Advanced Procurement ......................................................................................................................2-7 Oracle iProcurement In E-Business...............................................................................................................2-9 Key Oracle iProcurement Capabilities ..........................................................................................................2-10 E-Business Suite Integration..........................................................................................................................2-11 Procurement Suite Integration .......................................................................................................................2-13 Agenda...........................................................................................................................................................2-15 Key Functionality of Oracle iProcurement ....................................................................................................2-16 Oracle iProcurement Content Management...................................................................................................2-18 Content Zones................................................................................................................................................2-19 Stores .............................................................................................................................................................2-20 Shopping........................................................................................................................................................2-21 Overview of Checkout...................................................................................................................................2-23 Approval and Document Creation .................................................................................................................2-24 Overview of Receiving..................................................................................................................................2-25 Center-Led Procurement................................................................................................................................2-26 Agenda...........................................................................................................................................................2-27 Oracle iProcurement Shopping Data Flow ....................................................................................................2-28 Oracle iProcurement Submit Request Data Flow .........................................................................................2-30 Agenda...........................................................................................................................................................2-32 Oracle iProcurement Setup Overview ...........................................................................................................2-33 Oracle iProcurement Setup Steps ..................................................................................................................2-34

Practice - Create a New Employee and User .............................................................................................2-35 Solution - Create A New Employee and User ...........................................................................................2-36 Practice - Set Yourself Up As a Buyer ......................................................................................................2-40 Guided Demonstration - Run the Fill Employee Hierarchy Process .........................................................2-42

Summary........................................................................................................................................................2-43 Oracle iProcurement Content Management .................................................................................................3-1

Oracle iProcurement Content Management...................................................................................................3-3 Objectives ......................................................................................................................................................3-4 Procurement Process: Oracle iProcurement...................................................................................................3-5 Agenda...........................................................................................................................................................3-6 What Are iProcurement Catalogs? ................................................................................................................3-7

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R12 Oracle iProcurement Fundamentals Table of Contents ii

Why Use Catalogs? .......................................................................................................................................3-8 What is an iProcurement Store? ....................................................................................................................3-9 Where Does the Catalog Content Come From?............................................................................................3-10 Oracle iProcurement Content Management...................................................................................................3-11 Local or Buyer-Hosted Content.....................................................................................................................3-13 External or Supplier-Hosted Content.............................................................................................................3-14 External Marketplace-Hosted Content...........................................................................................................3-16 Choosing Content ..........................................................................................................................................3-17 Requirements of Local Catalogs....................................................................................................................3-18 Requirements of Supplier-Hosted Content ....................................................................................................3-19 Requirements of Marketplace-Hosted Content............................................................................................3-20 Utilization of Catalog Content.......................................................................................................................3-21 Control Content Using Content Zones...........................................................................................................3-22 Stores: Pulling It All Together...................................................................................................................3-23 iProcurement Catalog Administration ...........................................................................................................3-24 Agenda...........................................................................................................................................................3-25 Creating Local Content..................................................................................................................................3-26 Oracle iProcurement Content Management Review.....................................................................................3-27 Oracle Content Utilization Types ..................................................................................................................3-28 Local Content ................................................................................................................................................3-29 E-Business Suite Local Content ....................................................................................................................3-30

Practice - Create a Purchasing Category....................................................................................................3-31 Solution - Create a Purchasing Category ...................................................................................................3-32 Practice - Create Items...............................................................................................................................3-38 Solution Create Items .............................................................................................................................3-39

Uploading Local Content...............................................................................................................................3-44 Before Uploading Content.............................................................................................................................3-45 Upload Content: Resource Files ....................................................................................................................3-46 Item Content That You Upload .....................................................................................................................3-47 Uploading Local Content...............................................................................................................................3-48 Content Upload And Document Types..........................................................................................................3-49 Automatically Uploading Shopping Categories ............................................................................................3-50 Price Lists That You Upload .........................................................................................................................3-51 Online Content Authoring Flow ....................................................................................................................3-52 Upload Content Authoring Flow ...................................................................................................................3-53 Sample Item Spreadsheet Upload..................................................................................................................3-54

Practice - Create a Global Blanket Purchase Agreement and Edit Content...............................................3-55 Solution - Create a Global Purchase Agreement and Edit Content............................................................3-56

XML: More Catalog Control .........................................................................................................................3-62 XML Upload Items File Structure .................................................................................................................3-63 Uploading Items: Spreadsheet Compared to XML.......................................................................................3-65 Sample XML Administrative Section............................................................................................................3-66 Sample XML Data File Structure ..................................................................................................................3-67 Sample XML Document Header Section ......................................................................................................3-68 Sample XML Document Lines Section .........................................................................................................3-69 Sample XML Data Item Section....................................................................................................................3-70 Sample XML Data Price Section...................................................................................................................3-71

Practice - Understand the XML Data File Structure..................................................................................3-72 Practice - Load Items Using XML.............................................................................................................3-73 Solution Load Items Using XML ...........................................................................................................3-74

Loading Local Catalog Images ......................................................................................................................3-81 Sample Uploads for Image Files....................................................................................................................3-82 Maintaining Items and Prices ........................................................................................................................3-83 View Loader Job Status.................................................................................................................................3-84 View Document Upload History ...................................................................................................................3-86 Agenda...........................................................................................................................................................3-87 Catalogs, Content Zones, And Stores ............................................................................................................3-88

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R12 Oracle iProcurement Fundamentals Table of Contents iii

iProcurement Catalog Administration: Manage Stores ................................................................................3-89 Content Zones................................................................................................................................................3-90 Why Content Zones? .....................................................................................................................................3-91 Creating A Local Content Zone.....................................................................................................................3-92 Applying Content Security Rules ..................................................................................................................3-93 Applying Content Security Rules In Stores ...................................................................................................3-94

Practice - Create a Local Content Zone .....................................................................................................3-95 Solution Create a Local Content Zone....................................................................................................3-96

Creating A Punchout Zone ............................................................................................................................3-99 Creating An Informational Zone ...................................................................................................................3-100

Practice - Create an Informational Content Zone ......................................................................................3-102 Solution......................................................................................................................................................3-103

Creating Smart Forms....................................................................................................................................3-104 What Are iProcurement Stores? ....................................................................................................................3-105 Managing Stores ............................................................................................................................................3-107

Practice - Create a Store ............................................................................................................................3-109 Solution Create a Store ...........................................................................................................................3-110

Agenda...........................................................................................................................................................3-112 Remote Catalog Content................................................................................................................................3-113 Oracle iProcurement Catalog Management Review.....................................................................................3-114 Oracle Content Zone Types Review..............................................................................................................3-116 What is Punchout? .........................................................................................................................................3-117 What is Transparent Punchout? .....................................................................................................................3-118 Oracle iProcurement Punchout Models .........................................................................................................3-120 XML: The Language of a Punchout ..............................................................................................................3-121 Comparing a Supplier Punchout to a Marketplace Punchout ........................................................................3-122 Model 1 & 2 Technical Overview .................................................................................................................3-123 Models 3 & 4 Technical Overview................................................................................................................3-124 Deciding on a Punchout Model .....................................................................................................................3-126 Punchout Management ..................................................................................................................................3-127 Basic Punchout Setup Steps...........................................................................................................................3-128 Oracle Exchange Punchout Setup..................................................................................................................3-130 Supplier Punchout Setup ...............................................................................................................................3-131 Agenda...........................................................................................................................................................3-132 Administer Oracle iProcurement Catalog Structure .....................................................................................3-133 Catalog Structure Components ......................................................................................................................3-134 Local Catalog Structure: Categories ..............................................................................................................3-135 Local Catalog Structure: Items ......................................................................................................................3-136 Creating and Modifying the Catalog Structure..............................................................................................3-137 Online Schema Maintenance .........................................................................................................................3-138 XML Upload Schema File Structure .............................................................................................................3-139 Sample XML Schema File.............................................................................................................................3-140 Sample XML Schema Section.......................................................................................................................3-141

Practice - Review XML Schema Structure................................................................................................3-142 Practice - Load Categories using XML .....................................................................................................3-143 Solution Load Categories Using XML ...................................................................................................3-144

Manage Base Descriptors ..............................................................................................................................3-148 Manage Item Categories................................................................................................................................3-149 Managing Descriptors....................................................................................................................................3-150 Manage Category Hierarchy..........................................................................................................................3-152 Sample iProcurement Table of Contents .......................................................................................................3-153 Map iProcurement Categories .......................................................................................................................3-154 Map Purchasing Categories ...........................................................................................................................3-155 Shopping Category Mapping.........................................................................................................................3-156

Practice - Map iProcurement Categories to Purchasing Categories...........................................................3-157 Solution Map iProcurement Categories to Purchasing Categories .........................................................3-158 Practice - Build a Schema Hierarchy.........................................................................................................3-159

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R12 Oracle iProcurement Fundamentals Table of Contents iv

Solution - Build a Schema Hierarchy ........................................................................................................3-160 Uploading Categories and Descriptors ..........................................................................................................3-162 Agenda...........................................................................................................................................................3-163 Catalog Search Components..........................................................................................................................3-164 Types of Catalog Searches.............................................................................................................................3-165 Search Results Display: Paragraph ................................................................................................................3-167 Search Results Display: Grid.........................................................................................................................3-168 Special Characters in Catalog Searches.........................................................................................................3-169 Filtering and Sorting......................................................................................................................................3-170 Search Descriptor Characteristics..................................................................................................................3-171 Searchable Base Descriptors..........................................................................................................................3-172 Search Results Visible Base Descriptors .......................................................................................................3-173 Rebuild Catalog Indexes................................................................................................................................3-174 Search Engine Setup Impact..........................................................................................................................3-175 Agenda...........................................................................................................................................................3-176 iProcurement Catalog Administration ...........................................................................................................3-177 Setup Considerations .....................................................................................................................................3-178 Local Catalog Setup.......................................................................................................................................3-179 Profile Options for Uploading Local Content................................................................................................3-180 Supplier-Hosted Setup...................................................................................................................................3-181 Marketplace-Hosted Setup.............................................................................................................................3-182 Profile Options for Punchout .........................................................................................................................3-183

Practice - Recognize Catalog Specific Profile Options..............................................................................3-184 Agenda...........................................................................................................................................................3-186 Decide on a Catalog Source...........................................................................................................................3-187 Considerations for Local Catalogs.................................................................................................................3-189 Considerations for Supplier-Hosted Content .................................................................................................3-191 Considerations for Marketplace-Hosted Content...........................................................................................3-192 Considerations for Security ...........................................................................................................................3-193 Summary........................................................................................................................................................3-194

Oracle iProcurement Requisitions .................................................................................................................4-1 Oracle iProcurement Requisitions .................................................................................................................4-3 Objectives ......................................................................................................................................................4-4 Agenda...........................................................................................................................................................4-5 Procurement Process: Oracle iProcurement...................................................................................................4-6 iProcurement Flow ........................................................................................................................................4-7 iProcurement Home Page ..............................................................................................................................4-8 iProcurement Preferences ..............................................................................................................................4-9

Practice - Set User Preferences..................................................................................................................4-10 Solution Set User Preferences.................................................................................................................4-11

Shop For Goods and Services........................................................................................................................4-14 Practice - Creating a Favorites List............................................................................................................4-16 Solution Creating a Favorites List ..........................................................................................................4-17

Basic Shopping Flow.....................................................................................................................................4-20 Basic Checkout Flow.....................................................................................................................................4-21 Checkout Step-by-Step ..................................................................................................................................4-22 Review & Submit ..........................................................................................................................................4-24

Practice - Split Cost Across Charge Accounts...........................................................................................4-25 Solution Split Cost Across Charge Accounts .........................................................................................4-26 Practice - Specify Different Delivery Information for a Single Item.........................................................4-29 Solution Specify Different Delivery Information for a Single Item .......................................................4-30

Agenda...........................................................................................................................................................4-32 Enter iProcurement Users ..............................................................................................................................4-33 Document Routing Option #1: Employee/Supervisor Relationship ..............................................................4-35 Document Routing Option #2: Position Approval Hierarchy........................................................................4-36 Run Fill Employee Hierarchy Process...........................................................................................................4-38

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R12 Oracle iProcurement Fundamentals Table of Contents v

Document Routing Option #3: Oracle Approvals Management....................................................................4-39 Give Access to the Users ...............................................................................................................................4-41

Guided Demonstration - Scheduling Send Notification Workflows..........................................................4-42 My Notifications Region ...............................................................................................................................4-43 Center-Led Procurement................................................................................................................................4-44 Agenda...........................................................................................................................................................4-46 Set up iProcurement Shopping Defaults........................................................................................................4-47 Oracle Applications Framework....................................................................................................................4-48 OAF / iProcurement Personalization .............................................................................................................4-49

Guided Demonstration - Add Filter Option to Search Results Page..........................................................4-50 Setting Up iProcurement Information Templates ..........................................................................................4-52

Practice - Create an Information Template ................................................................................................4-53 Solution Create an Information Template...............................................................................................4-54 Practice - Submit a Requisition Using an Information Template ..............................................................4-57 Solution Submit a Requisition Using an Information Template .............................................................4-58

Smart Forms ..................................................................................................................................................4-61 Internally Sourced Requisitions Overview ....................................................................................................4-63 Internally Sourced Requisitions Details ........................................................................................................4-65 Internally Sourced Requisitions Prerequisites ...............................................................................................4-67

Guided Demonstration - Enter and Submit an Internally Sourced Requisition .........................................4-69 Services Procurement Contractor/Service Request ......................................................................................4-70 Oracle Services Procurement.........................................................................................................................4-72 Services Procurement: Contingent Labor Flow............................................................................................4-74 Oracle Procurement Feature Comparison......................................................................................................4-75 Agenda...........................................................................................................................................................4-76 Requisition Management Actions..................................................................................................................4-77 Copying Requisitions ....................................................................................................................................4-78 Canceling Requisitions ..................................................................................................................................4-79 Change / Resubmit Requisitions....................................................................................................................4-80 Requisition Statuses.......................................................................................................................................4-82 Requester Change Order................................................................................................................................4-83 Requester Change Order Approval................................................................................................................4-85 Procure to Pay Lifecycle Tracking ................................................................................................................4-87 Agenda...........................................................................................................................................................4-88 Setting Up Oracle iProcurement Responsibility and Function Security ........................................................4-89 Approval and Document Creation .................................................................................................................4-90 Automatic Purchase Order Creation ..............................................................................................................4-91 Automatic Release Creation ..........................................................................................................................4-92 Oracle iProcurement Requisition Approval...................................................................................................4-93 Integration with Oracle Approvals Management...........................................................................................4-95 Workflows Used by Oracle iProcurement .....................................................................................................4-96 PO Create Documents Workflow ..................................................................................................................4-98

Guided Demonstration - Set Values of Key Workflow .............................................................................4-100 Accounting Considerations for Oracle iProcurement ...................................................................................4-101 PO Account Generator Workflow .................................................................................................................4-102 Account Creation Overview ..........................................................................................................................4-103 Expense Account Rules .................................................................................................................................4-105

Practice - Create Expense Account Rules..................................................................................................4-106 Solution Create Expense Account Rules ................................................................................................4-107

Tax Calculation .............................................................................................................................................4-110 Grants Accounting and Hazard Information..................................................................................................4-111 Attachments and Special Requisitions...........................................................................................................4-112

Guided Demonstration - Create iProcurement Buyer Attachment.............................................................4-114 Agenda...........................................................................................................................................................4-115 Procurement Card Support ............................................................................................................................4-116 Procurement Card Flow - Order ...................................................................................................................4-117 Procurement Card Flow - Invoice..................................................................................................................4-118

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R12 Oracle iProcurement Fundamentals Table of Contents vi

Procurement Card Flow - Reconciliation ......................................................................................................4-120 Setting Up Credit Card Programs in Oracle Payables ...................................................................................4-122 Code Sets Window ........................................................................................................................................4-123 Card Programs Window ................................................................................................................................4-124 GL Account Sets Window.............................................................................................................................4-125 Credit Card Profiles Window ........................................................................................................................4-126 Credit Cards Window ....................................................................................................................................4-127 Credit Card Workflows .................................................................................................................................4-128 P-Card Setup for iProcurement......................................................................................................................4-129

Practice - Set Up and Use P-Cards ............................................................................................................4-130 Solution Set Up and Use P-Cards ...........................................................................................................4-133

Agenda...........................................................................................................................................................4-145 iProcurement Profile Options ........................................................................................................................4-146

Practice - Recognize Requisition Specific Profile Options........................................................................4-147 Solution......................................................................................................................................................4-148

Notification Routing Rules ............................................................................................................................4-151 Personalizing the Home Page ........................................................................................................................4-152 Home Page Logo ...........................................................................................................................................4-153 Purchasing News ...........................................................................................................................................4-154 Purchasing Policies........................................................................................................................................4-155 Descriptive Flex Fields In iProcurement .......................................................................................................4-156 Agenda...........................................................................................................................................................4-158 Requisition Implementation Considerations Checklist..................................................................................4-159 Important Points to Remember......................................................................................................................4-161 Summary........................................................................................................................................................4-162

Oracle iProcurement Receiving......................................................................................................................5-1 Oracle iProcurement Receiving.....................................................................................................................5-3 Objectives ......................................................................................................................................................5-4 Agenda...........................................................................................................................................................5-5 Procurement Process: Oracle iProcurement...................................................................................................5-6 Key Functionality of Oracle iProcurement ....................................................................................................5-7 Oracle iProcurement Receiving.....................................................................................................................5-8 Overview of Procurement Receiving.............................................................................................................5-9 Oracle iProcurement Receipt Routing ...........................................................................................................5-10 Agenda...........................................................................................................................................................5-11 Receiving in Oracle iProcurement.................................................................................................................5-12 Receiving Orders in Oracle iProcurement .....................................................................................................5-13 Oracle iProcurement Receiving Page ............................................................................................................5-14 Receiving Home Page Functions...................................................................................................................5-15 iProcurement Receiving Process ...................................................................................................................5-16 Finding Your Receipts...................................................................................................................................5-17 Oracle iProcurement Receiving.....................................................................................................................5-18

Practice - Receive in iProcurement............................................................................................................5-19 Solution Receive in iProcurement ..........................................................................................................5-20

iProcurement Receiving Process ...................................................................................................................5-23 Entering Returns in Oracle iProcurement ......................................................................................................5-24 iProcurement Receiving Process ...................................................................................................................5-26 Entering Corrections......................................................................................................................................5-27 Difference Between Returns and Corrections................................................................................................5-28

Practice - Process a Correction ..................................................................................................................5-29 Solution Process a Correction.................................................................................................................5-30 Practice - Process a Return ........................................................................................................................5-31 Solution Process a Return.......................................................................................................................5-32 Guided Demonstration - Run the Confirm Receipts Workflow (Required) ..............................................5-34

Receipt Header in Oracle iProcurement ........................................................................................................5-37 Receipt Line in Oracle iProcurement.............................................................................................................5-38

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R12 Oracle iProcurement Fundamentals Table of Contents vii

The PO Confirm Receipts Workflow ............................................................................................................5-39 Agenda...........................................................................................................................................................5-40 Purchasing Receiving Setup ..........................................................................................................................5-41 iProcurement Profile Options ........................................................................................................................5-43

Practice - Recognize Receiving Specific Profile Options..........................................................................5-44 Solution Recognize Receiving Specific Profile Options ........................................................................5-45

iProcurement Receipt Function Security .......................................................................................................5-46 Agenda...........................................................................................................................................................5-47 Additional Receiving Considerations ............................................................................................................5-48 Receiving Comparison ..................................................................................................................................5-49 Data Mapping Considerations .......................................................................................................................5-50 Data and Reporting Considerations ...............................................................................................................5-51 Optional Components ....................................................................................................................................5-52 Receiving Open Interface ..............................................................................................................................5-53 Overview of Payment on Receipt ..................................................................................................................5-54 Summary........................................................................................................................................................5-55

Oracle iProcurement Setup Steps ..................................................................................................................6-1 Oracle iProcurement Setup Steps ..................................................................................................................6-3 Objectives ......................................................................................................................................................6-4 Agenda...........................................................................................................................................................6-5 Procurement Process: Oracle iProcurement...................................................................................................6-6 Oracle iProcurement Integration with Oracle Applications Impact on Setup................................................6-7 Oracle iProcurement Setup Overview ...........................................................................................................6-8 Agenda...........................................................................................................................................................6-9 Oracle Applications Setup Overview ............................................................................................................6-10 Oracle Applications Setup Overview - 2 .......................................................................................................6-11 Oracle Applications Setup Overview - 3 .......................................................................................................6-12 Oracle Applications Setup Overview - 4 .......................................................................................................6-13 Agenda...........................................................................................................................................................6-14 Oracle iProcurement Setup Overview ...........................................................................................................6-15 Perform Oracle iProcurement Specific System Administration Setup ..........................................................6-16 Verify Profile Options That Impact Oracle iProcurement: Oracle Applications ...........................................6-17 Verify Profile Options That Impact Oracle iProcurement: Oracle Purchasing..............................................6-19 Verify Profile Options That Impact Oracle iProcurement .............................................................................6-21 Verify Profile Options That Impact Oracle iProcurement: Continued ..........................................................6-23

Practice - Recognize Catalog Specific Profile Options..............................................................................6-25 Practice - Recognize Requisition Specific Profile Options........................................................................6-27 Solution......................................................................................................................................................6-28 Practice - Recognize Receiving Specific Profile Options..........................................................................6-31 Solution Recognize Receiving Specific Profile Options ........................................................................6-32

Requisition Templates ...................................................................................................................................6-33 Define Information Templates.......................................................................................................................6-34 Set Up Catalog...............................................................................................................................................6-35 Agenda...........................................................................................................................................................6-36 Additional Implementation Considerations ...................................................................................................6-37 Training Considerations ................................................................................................................................6-38 Oracle iProcurement Features to Consider ....................................................................................................6-39 Custom Package Implementation ..................................................................................................................6-40 Page-Specific Customization.........................................................................................................................6-41 Summary........................................................................................................................................................6-42

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R12 Oracle iProcurement Fundamentals Table of Contents ix

Preface

Profile

Before You Begin This Course

Thorough knowledge of the Oracle E-Business Procure to Pay process.

Working experience with e Oracle E-Business Procure to Pay products.

Prerequisites

R12 Oracle Purchasing Fundamentals

How This Course Is Organized

This is an instructor-led course featuring lecture and hands-on exercises. Online demonstrations and written practice sessions reinforce the concepts and skills introduced.

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R12 Oracle iProcurement Fundamentals Table of Contents x

Related Publications

Oracle Publications Title Part Number

Oracle Purchasing User's Guide B28669-01

Oracle iProcurement Implementation and Administration Guide B31402-01

Oracle Procurement Buyer's Guide to Punchout and Transparent Punchout B13856-01

Oracle Payables User Guide B25454-01

Additional Publications

System release bulletins

Installation and users guides

Read-me files

International Oracle Users Group (IOUG) articles

Oracle Magazine

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R12 Oracle iProcurement Fundamentals Table of Contents xi

Typographic Conventions

Typographic Conventions in Text Convention Element Example Bold italic Glossary term (if

there is a glossary) The algorithm inserts the new key.

Caps and lowercase

Buttons, check boxes, triggers, windows

Click the Executable button. Select the Cant Delete Card check box. Assign a When-Validate-Item trigger to the ORD block. Open the Master Schedule window.

Courier new, case sensitive (default is lowercase)

Code output, directory names, filenames, passwords, pathnames, URLs, user input, usernames

Code output: debug.set (I, 300); Directory: bin (DOS), $FMHOME (UNIX) Filename: Locate the init.ora file. Password: User tiger as your password. Pathname: Open c:\my_docs\projects URL: Go to http://www.oracle.com User input: Enter 300 Username: Log on as scott

Initial cap Graphics labels (unless the term is a proper noun)

Customer address (but Oracle Payables)

Italic Emphasized words and phrases, titles of books and courses, variables

Do not save changes to the database. For further information, see Oracle7 Server SQL Language Reference Manual. Enter [email protected], where user_id is the name of the user.

Quotation marks

Interface elements with long names that have only initial caps; lesson and chapter titles in cross-references

Select Include a reusable module component and click Finish. This subject is covered in Unit II, Lesson 3, Working with Objects.

Uppercase SQL column names, commands, functions, schemas, table names

Use the SELECT command to view information stored in the LAST_NAME column of the EMP table.

Arrow Menu paths Select File > Save. Brackets Key names Press [Enter]. Commas Key sequences Press and release keys one at a time:

[Alternate], [F], [D] Plus signs Key combinations Press and hold these keys simultaneously: [Ctrl]+[Alt]+[Del]

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R12 Oracle iProcurement Fundamentals Table of Contents xii

Typographic Conventions in Code Convention Element Example Caps and lowercase

Oracle Forms triggers

When-Validate-Item

Lowercase Column names, table names

SELECT last_name FROM s_emp;

Passwords DROP USER scott IDENTIFIED BY tiger;

PL/SQL objects OG_ACTIVATE_LAYER (OG_GET_LAYER (prod_pie_layer))

Lowercase italic

Syntax variables CREATE ROLE role

Uppercase SQL commands and functions

SELECT userid FROM emp;

Typographic Conventions in Oracle Application Navigation Paths

This course uses simplified navigation paths, such as the following example, to direct you through Oracle Applications.

(N) Invoice > Entry > Invoice Batches Summary (M) Query > Find (B) Approve

This simplified path translates to the following:

1. (N) From the Navigator window, select Invoice then Entry then Invoice Batches Summary.

2. (M) From the menu, select Query then Find.

3. (B) Click the Approve button.

Notations:

(N) = Navigator

(M) = Menu

(T) = Tab

(B) = Button

(I) = Icon

(H) = Hyperlink

(ST) = Sub Tab

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R12 Oracle iProcurement Fundamentals Table of Contents xiii

Typographical Conventions in Oracle Application Help System Paths

This course uses a navigation path convention to represent actions you perform to find pertinent information in the Oracle Applications Help System.

The following help navigation path, for example

(Help) General Ledger > Journals > Enter Journals

represents the following sequence of actions:

1. In the navigation frame of the help system window, expand the General Ledger entry.

2. Under the General Ledger entry, expand Journals.

3. Under Journals, select Enter Journals.

4. Review the Enter Journals topic that appears in the document frame of the help system window.

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R12 Oracle iProcurement Fundamentals Table of Contents xiv

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Procure to Pay Lifecycle Overview Chapter 1 - Page 1

Procure to Pay Lifecycle Overview Chapter 1

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Procure to Pay Lifecycle Overview

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Objectives

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Procure to Pay Lifecycle

Procure to Pay Lifecycle

Sourcing Request for quote Supplier selection Contract negotiations and awards Catalog content management

Ordering Requisition and purchase order generation Purchase order management and fulfillment Payment

Reporting and Analysis Supplier performance Commodity analysis Internal compliance Robust intelligence gathering

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Decision support Process functionality

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Oracle Procure to Pay Process

Oracle Procure to Pay Process

Demand The procurement process generates and manages requests for the purchase of goods. The demand for purchase items may be a one-time event or may recur in either predictable or random time intervals. Source The procurement sourcing process covers the business activities related to the search, qualification, and selection of suitable suppliers for requested goods and services. Order The procurement ordering process includes purchase order placement by the buying organization and purchase order execution by the supplying organization. Receive The receipt process acknowledges that a purchase order has been duly executed. For orders of physical goods, it will typically include the receipt, inspection and delivery of the goods to inventory or to another designated location. For orders of services, it will typically consist of a

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notification from the requester or the approving person that the service has been performed as agreed. Pay The payment process consists of those activities involved in the payment for ordered goods and services.

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Demand: Requisitions

Demand: Requisitions

Requisitions represent demand for goods or services. Whether you want to provide online requisitions to everyone in the organization or limit the number of users who have access to the system, Oracle Purchasing is flexible enough to meet the needs of your organization. With online requisitions, you can centralize your purchasing department, source your requisition with the best suppliers, and ensure that you obtain the appropriate management approval before creating purchase orders from requisitions. Requisitions for goods and services:

Are generated by applications like Inventory, Work in Process (WIP), Advanced Supply Chain Planning (ASCP) and Order Management

May be entered manually through Oracle Purchasing windows May be entered using Oracle iProcurement May be imported from external systems

With Oracle Purchasing, you can:

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Create, edit, and review requisition information on-line. You can enter suggested supplier information, delivery instructions, multiple accounting distributions, and notes to buyers, approvers, and receivers.

Review the current status and action history of your requisitions. You always know who approves requisitions and whether they are in the approval, purchasing, receiving, or delivery stage.

Route requisitions according to your approval structure. You can set authorization limits by amount, charge account, item category, and location.

Review and approve requisitions that need your approval. You can see the full requisition detail and review the action history before you approve a requisition.

Print requisitions (with status Approved, Cancelled, Rejected, In Process, Pre-Approved, and Returned) for off-line review and approval. You can always be able to track the status of requisitions through the approval process.

Automatically source requisitions from outstanding blanket purchase agreements or quotations you have received from suppliers.

Create requisitions quickly and easily for commonly purchased items. Provide attachments as notes on requisition headers and lines. Assign requisition lines to buyers and review buyer assignments for requisition lines. Forward all requisitions awaiting approval from one approver to an alternate approver.

Within your security and approval constraints, you can reroute requisitions from one approver to another whenever you want.

Source goods from your own inventory with internal requisitions.

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Source: RFQs and Quotations

Source: RFQs and Quotations

Oracle Purchasing provides you with request for quotation (RFQ), and quotation features to handle your sourcing needs. You can create an RFQ from requisitions, match supplier quotations to your RFQ, and automatically copy quotation information to purchase orders. Oracle Purchasing provides complete reporting to control your requests for quotations and evaluate supplier responses. Quotations can be:

Entered manually Copied from an RFQ Imported using the Purchasing Documents Open Interface Imported using the e-Commerce Gateway

With Oracle Purchasing, you can: Identify requisitions that require supplier quotations and automatically create an RFQ. Create an RFQ with or without approved requisitions so that you can plan ahead for your

future procurement requirements.

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Record supplier quotations from a catalog, telephone conversation, or response from your request for quotation. You can also receive quotations electronically.

Review, analyze, and approve supplier quotations that you want available to reference on purchase orders and requisitions. You can evaluate your suppliers based on quotation information.

Receive automatic notification when a quotation or request for quotation approaches expiration.

Review quotation information online when creating purchase orders or requisitions and copy specific quotation information to a purchase order or requisition.

Source the items for which you negotiated purchase agreements automatically. If you created sourcing rules and approved supplier list entries for the items, supplier information can be entered automatically in the Requisitions window when you create requisitions. You can also place supplier information for items onto blanket purchase order releases.

With Oracle Purchasing and Oracle Sourcing, you can: Initiate a buyers auction in Oracle Sourcing based on requisitions in Oracle Purchasing. Create RFQs and negotiations in Oracle Sourcing that result in purchase orders and

purchase agreements in Oracle Purchasing. Collaborate on-line directly with suppliers to get the best terms and prices.

With Oracle Purchasing and Oracle iSupplier Portal, you can: Enable suppliers to query RFQs and manufacturing planning statuses. Enable suppliers to maintain their production capabilities in Oracle Purchasing.

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Suppliers

Suppliers

You must define a supplier before performing most activities within Oracle Purchasing and Payables. Once defined you can:

Optionally enter a recommended supplier on a requisition Use a supplier to issue a request for quotation Use that same supplier when you enter a quotation Use supplier information for purchase orders Receive goods or services from suppliers Return goods to suppliers Pay the supplier for the goods or services purchased

Set up suppliers to record information about individuals and companies you purchase goods and services from. You can also enter employees you reimburse for expense reports. You can designate supplier sites as pay sites, purchasing sites, RFQ only sites, or procurement card sites. For example, for a single supplier, you can buy from several different sites and send payments to several different sites. Most supplier information automatically defaults to all

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supplier sites to facilitate supplier site entry. However, you can override these defaults and have unique information for each site.

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Purchase Orders

Purchase Orders

Oracle Purchasing supports four types of purchase orders: standard, blanket, contract and planned. There are several methods that can be used to create purchase orders. You can manually create purchase orders or search approved requisitions and add them to purchase orders. Standard purchase orders can be imported through the Purchasing Documents Open Interface in a status of Incomplete or Approved. You can automate purchase document creation using the PO Create Documents workflow to automatically create a blanket purchase agreement release or a standard purchase order upon approval of a requisition. Once purchase orders are created, they may be submitted for approval. The approval process checks to see if the submitter has sufficient authority to approve the purchase order. Once the document is approved, it may be sent to your supplier using a variety of methods including: printed document, EDI, fax, e-mail, Oracle iSupplier Portal and XML. Once the purchase order or release is sent to your supplier, they are authorized to ship goods at the times and to the locations that have been agreed upon. Purchase documents may be created:

By buyers using the AutoCreate window By importing them using the Purchasing Documents Open Interface

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Automatically, by the Create Releases program (blanket releases) Automatically, by Workflow (blanket releases or standard purchase orders)

With Oracle Purchasing, you can: Review all of your purchases with your suppliers to negotiate better discounts. Create purchase orders simply by entering a supplier and item details. Create standard purchase orders and blanket releases from both on-line and paper

requisitions. Create accurate and detailed accounting information so that you charge purchases to the

appropriate departments. Review the status and history of your purchase orders at any time for all the information

you need. Record supplier acceptances of your purchase orders. You always know whether your

suppliers have received and accepted your purchase order terms and conditions. Copy existing purchase orders. Manage global supplier agreements (blankets and contracts) from a centralized business

unit. Manage approved contractual terminology from a library of terms using Oracle

Procurement Contracts.

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Receiving

Receiving

Using Oracle Purchasing, you can process receipts from suppliers, receipts from other warehouses or inventory organizations, in-transit shipments and receipts due to customer returns. You can search for expected receipts based on a purchase order or a customer return recorded in Oracle Order Management and then process them to their final destination whether it is inventory, expense or shop floor. Oracle Purchasing lets you control the items you order through receiving, inspection, transfer, and internal delivery. You can use these features to indicate the quantity, quality, and internal delivery of the items you receive. With Oracle Purchasing, you can:

Use routing controls at the organization, supplier, item, or order level to enforce material movement through receiving. For example, you can require inspection for some items and dock-to-stock receipt for others.

Define receiving tolerances at the organization, supplier, item, and order level, with the lowest level overriding previous levels. You can define tolerances for receipt quantity, on-time delivery, and receiving location. You can assign looser tolerances to low-value items. You can set enforcement options to ignore, warn the user, or reject transactions that violate the tolerances.

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Use blind receiving to improve accuracy in the receiving process. With this option, the quantity due for each shipment does not show and quantity control tolerances are ignored.

Use Express and Cascade receiving to process certain types of receipts more quickly. Use Advance Shipping Notices (ASNs) to save time in processing receipts. Record receipt of unordered items based on your item, supplier, or organization defaults.

For example, if your organization does not allow receipt of unordered items, you should not be able to enter a receipt unless it can be matched to a purchase order shipment.

Record the receipt of predefined substitute items. Record the receipt of services and labor.

With Oracle iProcurement, you can: Receive orders from your desktop, bypassing the need for receiving department

interaction.

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Invoicing

Invoicing

Once youve received goods or service from your supplier, youll also receive an invoice. Using Oracle Payables you can record invoices in a number of different ways. With Oracle Payables you can:

Enter invoices manually, either individually or in batches. Use the Invoice Gateway for rapid, high-volume entry of standard invoices and credit

memos that are not complex and do not require extensive online validation. Automate invoice creation for periodic invoices using the Recurring Invoice functionality. Use Oracle iExpenses to enter employee expense reports using a web browser. Record credit card/procurement card invoices from transactions the credit card issuer

sends to you in a flat file. Record Oracle Project related expense reports. Import EDI invoices processed with the Oracle e-Commerce Gateway. Import lease invoices transferred from Oracle Property Manager. Match invoices to purchase orders to ensure you only pay what youre supposed to be

paying for.

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Payment

Payment

Once invoices have been validated, they can be selected for payment. Oracle Payables provides the information that you need to make effective payment decisions, stay in control of payments to suppliers and employees, and keep your accounting records up-to-date so that you always know your cash position. Oracle Payables handles every form of payment, including checks, manual payments, wire transfers, EDI payments, bank drafts, and electronic funds transfers. Oracle Payables is integrated with Oracle Cash Management to support automatic or manual reconciliation of your payments with bank statements sent by the bank. With Oracle Payables, you can:

Ensure duplicate invoice payments never occur Pay only invoices that are due, and automatically take the maximum discount available Select invoices for payment using a wide variety of criteria Record stop payments Record void payments Review information on line on the status of every payment Process positive pay

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Overview of Oracle Application Integration

Overview of Application Integration

This slide attempts to capture the complex interaction of Oracle Applications resulting from the Procure to Pay process. The key Oracle Applications that are integrated to perform this process are described below. Inventory Order Management and Purchasing, as well as other Oracle applications can use items defined in Oracle Inventory. If the item is designated as a planned item, demand can be generated in the form of requisitions and sent to Oracle Purchasing where purchase orders or blanket releases can be created to replenish inventory levels. Order Management Customer purchase orders can be recorded in Oracle Order Management. Goods are shipped to customers as defined by the sales order. After goods are shipped, customer invoices are sent to Oracle Receivables and inventory levels are updated. Any customers that are set up in Order Management are shared with Receivables and vice versa. Receivables Oracle Receivables maintains information about invoices received from Oracle Order Management and other sources. Invoices are sent to customers who respond by sending

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payments. You can use Receivables to record receipts against customer accounts. Receivables, revenue and cash receipts are interfaced to Oracle General Ledger. Purchasing Oracle Purchasing captures accounting information on requisitions and purchase orders. Purchase orders are sent to suppliers who respond by delivering goods or services and sending invoices that are processed in Oracle Payables. During the accounting period, accruals for goods set to accrue a liability on receipt are sent to Oracle General Ledger. At the end of the accounting period, accruals for goods and services set to accrue a liability at period end can be sent to General Ledger. Any suppliers set up in Purchasing are shared with Payables and vice versa. Payables Supplier invoices are entered into Oracle Payables and if appropriate, matched to purchase orders in Oracle Purchasing. During the matching process, the invoice distribution is copied from the purchase order (in the case of an expense) or the appropriate liability account (in the case of an inventory item). Payables, expenses and payments are interfaced to Oracle General Ledger. Invoices for asset purchases can be interfaced to Oracle Assets. Assets Assets from Payables and other sources are maintained in Oracle Assets. Assets are added, processed, depreciated and eventually retired. At the end of each asset period, accounting information is interfaced directly to Oracle General Ledger. General Ledger Oracle General