AR

After shipping goods or services to customer, we will have to generate invoice in Accounting Receivables, this is a document that will be shared with customers for receiving payments from customers for goods or services provided to them. In order to generate invoice we should define below setups.
Define System Options (OU Level for a ledger )
Auto Accounting
Transaction Sources
Transaction Types
Collectors
Remit to Addresses
Open Accounting Periods
Approval Limits
Receivable Activities
Customer and Customer Sites
Invoicing and Accounting Rules

Once it is generated, amount can be received against to invoices generated for customers. In order to receive amount below are some important setups needed in oracle applications.
Receipt Classes and Receipt Methods
Assign Bank Accounts to Receipt Methods
Receipt Sources
Statement Cycles
Standard Memo Lines

Credit Memo : Seller identifies defective items which were shipped to customer and raise credit memo,
reduces customer liability.
1. After shipping goods, already a standard invoice is in place. ( Eg: $5000 ) 2. Seller identified that there is some defective item shipped, so the invoice should be less $1000. 3. So, seller create ‘Credit Memo’ for $1000 against $5000 invoice and bring it to $4000. 4. Send this credit memo to customer.
Debit Memo: Seller identifies missing some charges in actual invoice ( eg: freight charges), so raises debit memo,
increases customer liability.
1. After shipping goods, already a standard invoice is in place. ( Eg: $5000 ). 2. Later, seller identified that it is $500 missed towards freight charges. 3. Seller creates a Debit Memo for $1000 and send it to customer/buyer which increases liability of the customer. 4. This debit memo will be shared to customer.
Charge Back: When customer is valued to company, company will create a charge back invoice which is a new invoice with new due date on old invoice where due date already passed.

Basic accounting entries for invoice and receipts

When we create invoice

   Receivable A/C  Dr 1000

Revenue A/C Cr 1000

When we create Receipt - Cash

Cash A/C Dr 1000

Receivable A/C Cr 1000

Realized gain/loss account:

Customer will pay the invoice amount in different currency based on the payment terms. However, when paying customer may pay in other currency than functional currency as well.
Let us take an example.
The invoice amount on 01-DEC-2017 is INR 15000 and 1 USD = 60 INR on this date.
And, the payment term is N30 - 30 Days.

Now, customer paying $150 on 15-DEC-2017 ( AR takes exchange rate based on the invoice date.)
That means, customer has paid 150 * 60 = INR 9000 invoice amount.

Let us assume that if the exchanged rate on 15-DEC-2017 is 66.6666.
Based on this , the company gained some amount other than INR 9000.
(66.6666-60) * 150 = INR 1000, this amount goes into Realized Gains Account.

Let us assume that if the exchanged rate on 15-DEC-2017 is 58.
Based on this , the company lost some amount other than INR 9000.
(60-58) * 150 = INR 300, this amount goes into Realized Loss Account.

Grouping Rules to segregate AR invoices:

AutoInvoice uses the following hierarchy to determine which grouping rule to use for a transaction line:
1. The grouping rule specified in the Transaction Sources window for the batch source of the transaction line
2. The grouping rule specified in the Customer Profile Classes window for the bill-to site use of the transaction line
3. If you do not specify a rule in either the Transaction Sources or Customer Profile Classes window, AutoInvoice uses the default grouping rule specified in the System Options window.


Note: Receivables provides the DEFAULT grouping rule which contains all of the mandatory attributes. If you upgrade from a previous version of Receivables, the DEFAULT grouping rule initially becomes your default grouping rule.


COGS Account:  This is important account information for any organization in Income Statement(IS) that tells you that
Once revenue recognization is done then only deferred COGS account will be move to actual COGS account.

Technical Information

Below are some important tables in Oracle e-Business Accounts Receivables.

RA_CUSTOMER_TRX_ALL
This is the header table to store Invoices, debit memos, credit memos, charge backs and commitments headers information,
CUSTOMER_TRX_ID is the primary key which stores customer transaction id.

PREVIOUS_CUSTOMER_TRX_ID stores the customer_trx_id of the invoice for which a credit memo is created.
INITIAL_CUSTOMER_TRX_ID stores the customer_trx_id of the deposit and guarantee type invoices.
COMPLETE_FLAG = Y/N - Indicates whether a transaction is completed or not.

RA_CUSTOMER_TRX_LINES_ALL
This table stores invoices, debit memo, credit memo, charge back and commitment lines information.
CUSTOMER_TRX_LINE_ID is the primary key which stores customer transaction line id.

PREVIOUS_CUSTOMER_TRX_LINE_ID - actual invoice line id of credit memo invoice line, for ‘On Account’ line this will be null.

RA_CSUT_TRX_LINE_GL_DIST_ALL

At least one distribution line should exist in this table for each invoice line or credit memo line. Oracle uses this info to post proper amounts to GL.

AR_PAYMENT_SCHEDULES_ALL

RA_CUSTOMER_TRX_ALL CUSTOMER_TRX_ID

AR_PAYMENT_SCHEDULES_ALL CLASS       BR PMT INV DM CM CB DEP GUR STATUS - OP/CL AMOUNT_DUE_ORIGINAL AMOUNT_DUE_REMAINING AMOUNT_APPLIED CONFIRMATION_FLAG TERMS_SEQUENCE_NUMBER REVERSED_CASH_RECEIPT_ID ASSOCIATED_CaSH_RECEIPT_ID ACTUAL_DATE_CLOSED GL_DATE_CLOSED

AR_CASH_RECEIPTS_ALL CASH_RECEIPT_ID

            

IF AMOUNT_DUE_REMAINING = 0 THEN STATUS = ‘CL’ and ACTUAL_DATE_CLOSED  = SYSDATE.
REVERSED_CASH_RECEIPT_ID  → Debit memo Receipt Reverse.
ASSOCIATED_CASH_RECEIPT_ID → Chargeback Receipt.
AMOUNT_DUE_REMAINING contains on-account and unapplied amounts also.
Credit items such as credit memos and receipts are stored as negative numbers and others are +ve.
CONFIRMED_FLAG - Receipts can be confirmed using this column.

AR_CASH_RECEIPTS_ALL
AR_RECEIVABLES_TRX_ALL
AR_RECEIVABLE_APPLICATIONS_ALL
AR_CASH_RECEIPT_HISTORY_ALL