AP/AR Netting: Setup and Usage (Doc ID 1399565.1) : in This Document

2/24/2020 Document 1399565.
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AP/AR Netting: Setup and Usage (Doc ID 1399565.1) To Bottom
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Document Details
1. Overview of AP / AR Netting
2. Setup Requirements for AP / AR Netting
Type:
a. Create a Customer in Receivables REFERENCE
Status:
PUBLISHED
b. Create a Supplier in Payables Last Major
Update: 19-Sep-2017
c. Define a Netting Bank Account in Payables Last 05-Dec-2019
Update: English
d. Associate your Bank Account to The Receipt Class AP/AR Netting in Receivables
Language:
e. Check the “Allow payment of unrelated transactions” in Receivables
f. Check Sequential Numbering Setup
Related Products
g. Review Descriptive Flexfield (DFF) setup
Oracle Payables
3. Create a transaction in Receivables Oracle Receivables
4. Enter an invoice for your supplier
5. Validate the Invoice Information Centers
6. Create a Netting Agreement R12AP: Information Center:

Oracle Payables 1099 Tax
7. Create a Netting Batch Reporting [1381863.2]
8. Submit the Batch Information Center: Overview
of the Receipts Workbench in
9. View Final Netting Report Oracle Receivables (AR) 11.5
10. Query the Netting Receipt and later [1362278.2]
Responsibility: Receivables Manager Information Center: Month

Navigation: Receipts > Receipts End Processing in Oracle
Receivables (AR) [1370198.2]
Information Center: Overview

of AutoInvoice in Oracle
Receivables (AR) 11.5 and
11. Once an AP/AR netting agreement is created, is there a way to submit the netting batch via a scheduled concurrent later [1137414.2]
process to avoid having to run the Netting batch manually?
Information Center: Overview
Still Have Questions? of the Transactions
Workbench in Oracle
References Receivables (AR) 11.5 and
later [1320546.2]
Show More
APPLIES TO:
Document References
Oracle Payables - Version 12.0.0 and later
Oracle Receivables - Version 12.0.0 and later FAQ : AP/AR Netting Common
Questions and Problems
Information in this document applies to any platform.
[1067767.1]
PURPOSE
Recently Viewed
Oracle Receivables (AR): Receipts Workbench Information Center > 1399565.1
R12: AP/AR Netting – A
Technical Insight [731191.1]
This document provides an overview of the AP/AR Netting Process in Release 12. R12: AP: Is There a Way of
It contains information on the various components that make up the AP/AR Netting process, Making Negative Payment in
including setup requirements, how to create a Netting Agreement and sample output. a Payment Process Request
(PPR) [1582882.1]
R12: AP: Negative Line Not
SCOPE Allowed On The Invoice
[1668537.1]
SRDC - EBS Receivables:
Customer Workbench
[1677714.1]
DETAILS Customer Interface:
Overview and Setup
[1493002.1]
NOTE: In the images below and/or the attached document, user details / company name / address / email / telephone Show More
number represent a fictitious sample (based upon made up data used in the Oracle Demo Vision instance). Any similarity to
actual persons, living or dead, is purely coincidental and not intended in any manner.
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1. Overview of AP / AR Netting
Oracle AP/AR Netting allows you to net your Payables invoice balances against your Receivables invoice balances for those
Customers who are also your Suppliers. For example, If you have a customer who is also your supplier, then rather than him
paying you and then you paying him,
AP/AR netting allows you to pay the net difference between how much you owe the supplier and how much he owes you. After
establishing a netting agreement with such trading partners, you set up the agreement and the rules associated with it in
eBusiness Suite and you can then start to net AP and AR transactions.
Prior to Release 12, there were several netting solutions in the eBusiness Suite:
Contra-Charging
This Globalization feature was originally a solution for

Germany in Release 11, but then it became a Regional Globalization feature in Release 11i.
US Federal Financials Netting
This solution specifically addresses the needs of US requirements.
In Release 12, AP/AP Netting has become "core" functionality and is the only netting solution available, which means Contra-
Charging and US Federal Financials Netting are all replaced by this solution. Each of those features has a migration path to the
Release 12 Netting feature.
2. Setup Requirements for AP / AR Netting
a. Create a Customer in Receivables
Responsibility: Receivables Manager

Navigation: Customer > Customer
Make sure the Payment Term is set to Immediate and the Profile Class is Default
b. Create a Supplier in Payables
Responsibility: Payables
Navigation: Suppliers > Entry
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Make sure that the supplier site is flagged as a Pay Site, and the Payment Terms are set to Immediate.
c. Define a Netting Bank Account in Payables
Navigation: Setup > Payment
In the Account Controls, check the flag indicating that this account is to be used for Netting
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d. Associate your Bank Account to The Receipt Class AP/AR Netting in Receivables

Navigation: Setup > Receipts > Receipt Class
The AP/AR Netting receipt class is a seeded value.
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e. Check the “Allow payment of unrelated transactions” in Receivables

Navigation: Setup > System > System Options
f. Check Sequential Numbering Setup
Check that the setting for profile option 'Sequential Numbering' is consistent between Receivables and Payables
Responsibility: System Administrator

Navigation: Profile > System
Query for Application = Receivables and Payables

Check the settings for profile option: Sequential Numbering
and ensure they are set to the same value
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If the profile option is set to "Always Used" verify that you have completed the setup to use document sequencing as
follows:

Navigation: Application > Document > Define
Create Document Sequences of type Automatic for Payables.
Check Payables Document Sequence Setup:
Navigation: Application > Document > Assign
Assign the above defined sequence to AP Categories 'NETTING' (AP Category).

Make sure to use NETTING (in capitals) as category since this is hardcoded in in the code appaypkb.pls.
Save.
Check Receivables Document Sequence Setup:
Navigation: Application > Sequential Numbering > Categories

Verify that there is a Category defined for: 'AP/AR Netting'
Navigation: Application > Document > Assign

Assign a receipt sequence to the AP/AR Netting Category
For additional information on how to setup document sequences in Receivables, please review: Note 1086565.1 How To
Setup Document Sequences In Receivables
g. Review Descriptive Flexfield (DFF) setup
When you settle a netting batch, the process may need to create a Netting Receipt in Receivables or a Netting Invoice in
Payables. Since this creation will be automated - it cannot determine what values to populate into a DFF for which you
have required segments.
To ensure that your DFF definition will not interfere with the creation of the Netting Receipt/Invoice, review the setup for
Receipt Information Flexfield or Payment Information flexfield and ensure none of the segments are defined as Required.

Navigation: Application > Flexfield > Descriptive > Segments
Query for Title = Receipt Information

Locate the Context you use and click on Segments
Click on Open for each segment and check that none have Required checked
Do the same for Title = Payment Information
3. Create a transaction in Receivables

Navigation: Transactions > Transactions
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4. Enter an invoice for your supplier
Navigation: Invoice
Do not enter any tax. Check that the terms on the invoice are Immediate, and validate it.
5. Validate the Invoice
Navigation: from the same form in Actions > Validate
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6. Create a Netting Agreement
Navigation: Payments > Entry > Netting > Netting Agreement
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7. Create a Netting Batch
Navigation: Netting > Netting Batch
Search for your Netting batch, and monitor it’s status. You can also monitor the Concurrent Request using View Requests.
When the Status is Selected, click on the Update icon and then assure that your transactions have been selected under the
Payables and Receivables tabs.
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8. Submit the Batch
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9. View Final Netting Report
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10. Query the Netting Receipt

Navigation: Receipts > Receipts
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11. Once an AP/AR netting agreement is created, is there a way to submit the netting batch via a scheduled concurrent
process to avoid having to run the Netting batch manually?
Fix is in DocID:1336994.1 AP/AR Netting Issue: Can AP/AR Netting Batch be Scheduled to Run Automatically?
Fixed Files
R12.FUN.A:
funntcpb.pls 120.2.12000000.7
R12.FUN.B:
funntcpb.pls 120.2.12010000.6
3. Recommended Patches
R12.FUN.B: Patch 12401006
Still Have Questions?
To discuss this information further with Oracle experts and industry peers, we encourage you to review, join or start a
discussion in the My Oracle Support Receivables Community.
To provide feedback on this note, click on the Rate this document link.
REFERENCES
NOTE:1067767.1 - FAQ : AP/AR Netting Common Questions and Problems

Didn't find what you are looking for? Ask in Community...
Related
Products
Oracle E-Business Suite > Financial Management > Procure to Pay > Oracle Payables > Pmt PayReports PBatch & Prepay
Oracle E-Business Suite > Financial Management > Credit to Cash > Oracle Receivables > Receipts Related > AR/AP Netting
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2/24/2020 Document 1399565.1
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AP/AR Netting: Setup and Usage (Doc ID 1399565.1) To Bottom

In this Document Was this document helpful?

6. Create a Netting Agreement R12AP: Information Center:

Responsibility: Receivables Manager Information Center: Month

Information Center: Overview

This Globalization feature was originally a solution for

US Federal Financials Netting

This solution specifically addresses the needs of US requirements.

2. Setup Requirements for AP / AR Netting

a. Create a Customer in Receivables

Responsibility: Receivables Manager

b. Create a Supplier in Payables

c. Define a Netting Bank Account in Payables

Responsibility: Receivables Manager

The AP/AR Netting receipt class is a seeded value.

e. Check the “Allow payment of unrelated transactions” in Receivables

Responsibility: Receivables Manager

f. Check Sequential Numbering Setup

Responsibility: System Administrator

Query for Application = Receivables and Payables

Responsibility: System Administrator

Create Document Sequences of type Automatic for Payables.

Check Payables Document Sequence Setup:

Navigation: Application > Document > Assign

Assign the above defined sequence to AP Categories 'NETTING' (AP Category).

Check Receivables Document Sequence Setup:

Navigation: Application > Sequential Numbering > Categories

Navigation: Application > Document > Assign

g. Review Descriptive Flexfield (DFF) setup

Responsibility: System Administrator

Query for Title = Receipt Information

Do the same for Title = Payment Information

3. Create a transaction in Receivables

Responsibility: Receivables Manager

4. Enter an invoice for your supplier

5. Validate the Invoice

6. Create a Netting Agreement

7. Create a Netting Batch

8. Submit the Batch

9. View Final Netting Report

10. Query the Netting Receipt

Responsibility: Receivables Manager

R12.FUN.B: Patch 12401006

Still Have Questions?

NOTE:1067767.1 - FAQ : AP/AR Netting Common Questions and Problems

English Source Japanese 日本語

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