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| Re: Acccounting entry in Ebuy to Pay [message #209798 is a reply to message #209667] |
Sun, 17 December 2006 21:18   |
shashidhar.k
Messages: 127
Registered: January 2006
Location: India
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Senior Member |
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Hi Venkat..Here with iam sending the information which you asked about P2P....Actually in P2P application will generate Journal entries from the point of 'Receiving Goods'..Before tht one it won't create JV...
Note : if anything worng in the following information ..plz correct me...
I) Receiving Accounting
a).for Inventory Item
Receiving Accrual Dr
Cr Inventory AP Accrual A/c.
b).For Expenses Item
Receiving Accrual A/c Dr
Cr Accrued Expense A/c
Delivery Accounting
a).for Inventory Item
Raw Material A/c Dr
Cr Receiving Accrual A/c
b). for Expense Item
Accrued Expense A/c Dr
Cr Receiving Accrual A/c
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The reserve for encumbrance account is used when encumbrance accounting is enabled for SOB. When a Requisition or PO is created then in Oracle Financial there is no accounting entries. But when you have enabled your encumbrance accounting then system creates encumbrances accounting enties for PO as well as for Req.
When requisition is created system creates accounting entries as follows :-
Req Charge Account Dr XXXX
This enrty is not balanced. When this entries is posted in GL then it is autiomatically balanced by reserve for encumbrance account given in SOB...
The entry after posting will be as follows:-
Req Charge Account Dr XXXX
To Reserve for Encumbrance Account Cr XXXX
When a PO is auto created with this requisition then REQ encumbrances will be reversed and PO Encumbrance will be generated. (PO and REQ Encumbrances will be defined in Financial Option- Encumbrance TAB in Accounts Payable / Oracle Purchasing TAB).....
The entry will be :-
Generation of PO Encumbrance:-
PO Charge Account Dr XXXX
To Reserve for Encumbrance Account Cr XXXX
Reversal of Req Encumbrance:-
Reserve for Encumbrance Account Dr XXXX
To Req Charge Account Cr XXXX
An when PO is matched to Invoice the PO encumbrance is released because it has now become actual...
If we enter any unmatched invoice in AP then the following entry is created:-
INV Charge Account Dr XXXX
To Reserve to Encumbrance Cr XXXX
These encumbrance entries are reversed when PO or REQ is cancelled...
These entries generating in PO module are not automaticaly imported to GL we have to import these journal entries by running the following Program -- Program - Create Journals in General Ledger.
Encumbrance entries in AP are automatically transfered when payable transfer to GL is run.
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II) For Invoice and Payment
a) On entering an invoice
Expense A/c Dr
Tax A/c Dr
Cr AP Liability A/c
b) On making a payment
AP Liability A/c Dr
Cr Cash A/c.
c) On making a payment when cash Clearing account is used
AP Liability A/c Dr
Cr Cash Clearing A/c
d) On reconciling the payment.
Cash Clearing A/c Dr
Cr Cash A/c.
e) on entering Prepayment Invoice
Prepayment A/c Dr
Cr AP Liability A/c
When prepayment applied to any standard invoice
AP Liability A/c Dr
Cr Prepayment A/c
f). On entering any Debit /Credit Memo
AP Liability A/c Dr
Cr Expense A/c
g).on Creating With Holding tax Invoice in Payables
With Holding Tax A/c Dr
Cr AP Liability A/c
Thanks
Shashidhar K
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