4 Replies Latest reply on Sep 21, 2015 12:05 PM by User704932-Oracle

    Written-off PO can still be Paid?

    CSG

      Hi All,

       

      I had a PO with qty 2500 (one line, one shipment, one distribution), 3 way match, receipt match invoice option and accrue at receipt. All quantities were received but only for 2250 payment was made. So this PO distribution was showing up in accrual write off. So it was written off for 250 dollars and creating accounting was completed. After this I could create a AP invoice and matched to the same PO distribution and receipt (where 250 dollar was unbilled) and payment was made for this PO. Now what has happened due to this is that Supplier has been paid twice. Once PO distribution is written of, does Oracle not stop from matching the written off distribution?

       

      Thanks.

        • 1. Re: Written-off PO can still be Paid?
          User704932-Oracle

          Hi

          Please kindly provide APLIST for the 250 invoice generated  from

          Oracle Payables Invoice Data Collection Test (Doc ID 732163.1)


          You may also send the Aplist directly to me

          joseph.adjei@oracle.com


          Thanks:


          Joe

          1 person found this helpful
          • 2. Re: Written-off PO can still be Paid?
            CSG

            Hi Joe,

             

            I have sent you email on joseph.adjei@oracle.com. Thanks for your help. Appreciate it.

             

            Cheers.

            • 3. Re: Written-off PO can still be Paid?
              CSG

              Joe recommended:

               

              The Functionality recommended is that if a write off transaction is later invoiced in order to get correct accounting

              and prevent a debit entry in the Accrual Account the previous write off amount must be REVERSED.


              Moreover, Vendor was never paid when the $250 write off was made.

               

              Thanks,

              Ritu

              • 4. Re: Written-off PO can still be Paid?
                User704932-Oracle

                Thia is the Full Reply sent to Customer:

                 

                 

                1. 1. First we will request you review the Note  below thoroughly 

                How To Diagnose Inventory Accruals And Accrual Write Off Issues (Doc ID 866733.1)

                 

                1. 2. Write off of transactions must not be taken lightly. Write Off of Receipts

                must only be done when there are  Differences between receipts and invoices with no intention of future invoicing.

                If there is a potential of future intention to invoice write off should not be done.

                Before write off is done one should first explore the possibility of Returning the goods if invoicing/payment is

                not going to be made for goods already received.

                 

                We have reviewed the APLIST you loaded and data reflects current functionality.

                The $250 was previously written off because user believed there was no intention of future invoicing.

                You stated that the system allowing the invoicing and payment of this amount at a future date means:

                " Now what has happened due to this is that Supplier has been paid twice".  This is not true. Vendor was never paid when the

                $250 write off was made.

                The Functionality recommended is that if a write off transaction is later invoiced in order to get correct accounting

                and prevent a debit entry in the Accrual Account the previous write off amount must be REVERSED.

                 

                When Receiving is done:

                 

                Debit Receiving a/c

                Credit Accruala/c 

                 

                When write off is done:

                Accrual Account is Debited

                Write Off Offset Account  Credited

                 

                When a Write Off is Reversed

                Write Off Offset Account is Debited

                Accrual Account is Credited

                 

                Now therefore if the write off is invoiced

                Accrual Account will be debited

                Ap Liability Credited

                 

                When Payment is finally made to Vendor

                Liability a/c (vendor)  Debited

                Cash   Credited

                 

                 

                In your scenario let us just concentrate on the $250

                 

                1) When Receiving was done

                Debit Receiving a/c  $250

                Credit Accrual a/c      $250

                 

                When Write off was made

                 

                Accrual/A/c    Debited $250

                Write Off Offset a/c  Credited $250

                 

                (Write off therefore zeros the Balance of Accrual a/c)

                 

                2) When invoice was made to vendor

                 

                Accrual a/c  Debited $250

                Liability a/c (Vendor) credited $250

                 

                Payment made:

                Debited Liabilitya/c (Vendor) $250

                Credited Cash $250

                 

                3) At this stage we have a Debit Balance of $250  in the Accrual Account.

                To get rid of this we need to Reverse the original Write Off entry made

                 

                Reversal:

                 

                Debit Write Off Offset a/c  $250

                Credit Accrual a/c $250

                 

                (This will once again zero out Balance of Accrual a/c)

                 

                Thanks:

                 

                Joe