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Integration of Advanced Pricing and IntercompanyInvoicing

Case 1

INV: Intercompany Invoice for Internal Sales Orders is set to 'Yes' INV: Advanced pricing for Intercompany Invoice is set to 'Yes' and Advanced

Pricing is installed

Intercompany Invoicing will look for an external APIa customer/userprogrammable hookto return the price for the item included on the Internal salesorder. If the API does not return a value then pricing logic gets the price from theprice list. If it is able to find the price for that item in one of the price lists thenIntercompany Invoicing uses that value. If it is unable to find the correct price for

that item then the Intercompany Invoicing process logs an error message.

Case 2

INV: Intercompany Invoice for Internal Sales Orders is set to "Yes" INV: Advanced Pricing for Intercompany Invoice is set to "No"

The pricing logic gets the price for the item from the static transfer price list that hasbeen specified for that customer (Internal) in the Customer setup. If there is noprice defined then an error message is logged.

Advanced Pricing setup allows you to define different rules based on which price listshould be used to get the invoice price for an item. New Request Type, GlobalStructure, Context and a new set of Qualifier and Pricing Attributes are seeded.

Implementation Considerations

If you want to use Advanced Pricing feature for Intercompany Invoicing, you have toset the following profiles at the user level with the following values: QP: PricingTransaction Entity - Intercompany Transaction, QP: Source System Code - OracleInventory. This will allow you to see and use the Intercompany context, in addition

to the Order Fulfillment context to define attribute-mapping rules.

Two new mappings/relationships between request type and source system codeshave been seeded. One is between request type IC and source system INV, and thesecond is between request type IC and source system QP. The request type IC andSource system INV are new set of seed data. The above two mappings allow you tohave price lists that are common to both inter-company invoicing and sales orderinvoicing. For trade orders, price lists are created with source system code of "QP,"and the mapping between OM (Oracle order management system) and QP(Advanced pricing) is used to pick price lists for trade order invoices. Similarly, inter-

company users may decide to create separate price lists for intercompany invoicing,

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that is with source system code of INV. This can be achieved by setting the profile"QP: Source system code" to INV.

In order to use only these prices lists for inter-company invoicing, the mappingbetween IC and QP should be disabled, otherwise if pricing engine finds a better fit

for the price list defined under QP, it will return use that price list.

A new global structure has been defined that can be used to define mapping rulesfor qualifier attributes and pricing attributes for price lists. This global structure isbased on all the information that is captured and available in a sales order or aninternal sales order record. All seeded defaulting rules are defined by using thisglobal structure. Users can use the data in this global structure to define moremapping rules.

Intercompany Invoicing

You can view intercompany invoices for internal sales orders on the sales orderswindow (Actions > View Additional Line/Order Info > Invoices / Credit Memos)There is no provision for internal sales order to be invoiced using Invoice Interface -Line workflow activity. Order Management extracts data from the Accounts Payablesand Accounts Receivables tables to display the data in the Invoices / Credit Memotab for internal sales orders. If the value of the profile option OM: ViewIntercompany AR invoice is set to Yes, you will be able to view Intercompanyinvoices for internal sales orders. The other options are No or Null.

Process Steps

Requesting (Receiving) Operating UnitPurchasing: Create InternalRequisition with Source organization and Destination organization. Approvethe internal requisition

.

Note: The destination inventory organization must be a part of a separateoperating unit such as the Shipping Operating Unit in order to trigger

Intercompany transactions.

Requesting (Receiving) Operating UnitPurchasing: Launch theCreate Internal Sales Order program

Shipping Operating UnitOrder Management: Import the Internal SalesOrder. Pick and Ship confirm the Internal Order

Requesting (Receiving) Operating UnitPurchasing: Perform aReceiving transaction.

Source OrganizationInventory: Run 'Create Intercompany AR Invoice'for the Shipping operating unit

Shipping Operating UnitReceivables: Run ' AutoInovice Master'program for the internal order with Invoice Source as "Intercompany." Thisgenerates the accounts receivable invoice for the Shipping Operating Unit.

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Destination OrganizationInventory: Run "Create Intercompany APInvoice" for the Requesting (Receiving) Operating Unit

Requesting (Receiving) Operating UnitPayables: Run the ExpenseImport program with source "Intercompany."

Intercompany Invoicing Incoming Cost

When using Intercompany Invoicing for Internal Sales Orders you can allow theIncoming cost for the Destination organization to be based purely on the Transferprice and not the item cost from the Source organization. In order to use this featureyou must:

Setup Intercompany Invoicing for Internal Sales Orders. See the OracleAdvanced Pricing User's Guideand the Oracle Inventory User's Guide.

Set the profile option CST: Transfer Pricing Option to "Yes - Price As IncomingCost"

o If it is set to "Yes - Price as Incoming cost" or "Yes - Price Not AsIncominng Cost," new accounting entries are generated in Costing.When set to 'Yes - Price Not As Incoming Cost' - incoming cost to theDestination organization is the Source organization inventory cost.

o If it is set to "No" then existing costing entries occur.Both Inventory Cost of Goods Sold Account and the profile OM: Generate Cost ofGoods Sold Account workflow processes must be defined.