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RD.050 BUSINESS REQUIREMENTS SCENARIOS FOR CORE BUSINESS PROCESS
ORAERP Inc. COMAPNY
Oracle Accounts Payables
Author:
Creation Date: 02-June-13
Last Updated: 02-June-13
Document Ref: RD050_AP
Version: 1.0 Final
Approvals:
NAMES
i | P a g e
RD.050 Business Requirements Scenarios Doc Ref: RD.050
Ver.1.1 Final
Document Control
Change Record
1
Date Author Version
Change Reference
29-May-13
1.0 No Previous Document
References
Document Name Ref.
MOM & AS-IS flow charts recorded --
Accounting policies and procedure manual by D&T
AP
Business plans for unbundled companies by D&T
--
Proposed Organizational Chart for 10 companies
--
Sector Law --
Tender specification requirements (excel sheets)
--
Reviewers
Name Position
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Name Position
Distribution
Copy No.
Name Location
1
2
Note To Holders:
If you receive an electronic copy of this document and print it out, please write your name on the equivalent of the cover page, for document control purposes.
If you receive a hard copy of this document, please write your name on the front cover, for document control purposes.
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1. BUSINESS PROCESS IDENTIFICATION 4
1.1 Supplier Creation (AP001)..................................................................................................................5
1.2 Creating Standard Invoice – With Purchase Order/ GRN (AP002)....................................6
1.3 Creating Standard Invoice – Without Purchase Order (AP003).........................................8
1.4 Creating Prepayment Invoice (AP004)........................................................................................14
1.5 Entering Credit Memo (AP005)......................................................................................................18
1.6 Payment (AP006)..................................................................................................................................20
2. BUSINESS PROCESS DIAGRAMS 24
2.1 Invoice WorkBench..............................................................................................................................25
2.4 Invoice Processing For Assets.........................................................................................................28
2.5 Payment Process...................................................................................................................................29
2.6 Month End Process...............................................................................................................................30
3. OPEN AND CLOSED ISSUES FOR THIS DELIVERABLE 31
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Objectives
The objective of this document is to outline the Business Requirements, in as much detail as possible, related to General Ledger business processes in ORAERP COM INC., Abu Dhabi, to facilitate implementation of Oracle Accounts Payables.
BASIC GUIDELINES TOWARDS FINALISATION OF BUSINESS REQUIREMENTS/CURRENT BUSINESS BASELINE DOCUMENT SHALL BE TO ENSURE AN EFFICIENT, SMOOTH AND EFFECTIVE IMPLEMENTATION, BY OBSERVING THE FOLLOWING:
1. The objective is to utilize to the best possible extent, the flexibility and facilities of Oracle General Ledger.
2. Flexibility, therefore, will be the norm and will be ‘Built – In’ at every stage to the best possible extent, based on available current information on the Business Processes given by the users.
3. Reduction of the gaps will be ensured as far as possible.
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Scope
The scope of this study is limited to the functions pertaining to Accounts Payble based on the Business Requirements information provided by ORAERP COM INC..
The focus of the study and this document is to identify and outline the processes involving the management of the Accounts Payable functions in the Oracle Application.
Business requirements Information
A combination of the following methods were used for collecting data on current business scenario and future requirement for the 10 new companies-
Standard questionnaire based discussions with purchasing and stores departments on requirement of standard functions, special issues
Visit to all all major stores and study of all processes, procedure, documents
Overview of current IT systems being used
Current forms and reports used for purchasing, contracts and inventory functions
Document review of proposed Business plans, Statement of Accounting policies and procedures by Deloitte & Touche with reference to inventory & purchasing function
(SAPP 3 & 12)
Study of proposed draft organization structure for the 10 companies and sector law
Information collected from Function Heads and their team on various dates during the Requirements Analysis in Jan 2003, through meetings and discussions at various locations. Discussions with user departments like Services, Generation, T&C, Projects etc
Discussions with General Managers of new companies.
Validation of requirements specified in the tender documents.
AS-IS Processes
Based on above and various Minutes of Meetings all the ‘AS-IS’ processes as understood were drawn.
TO-BE Processes
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The current business scenario has limited application and usefulness and requirement analysis has to be primarily evolved using available documents, requirements communicated through various discussions on the future vision, policies and procedures for the new companies.
The following inputs were considered for the design of TO-BE processes-
Proposed organization structure
D&T policies to the extent applicable to business processes
Best practices as per Oracle ERP standard processes
Elements of Current processes only to the extent applicable in future scenario
Abbreviations Used
The following abbreviations with the expanded forms have been used in this document:
Abbr. Detail
AP Accounts Payable
INV Invoice
CUR Currency
INT Invoice Type
SEQ Sequence
Amt Amount
DR Debit
CR Credit
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Abbr. Detail
LT Ledger Type
CUR Currency Code
INB Invoice Batch
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1.1 Supplier Creation (AP001)
Process: Supplier Creation Business Function: Accounts Payable Date :May 30,2013
Mapping Team: ORAERP COM INC. Process Owner: Finance Team
Librarian: Priority (H, M, L): High Core (Y/N) : Yes
Process Number: AP001 Description: This process explains the process of creating supplier
Assumptions ADBC Company, Supplier master data is created at corporation level and the respective sites are created in each legal entity/operating unit
Event Description: This process is triggered when we want to purchase any material from the suppliers.
Number:AP.001 Type: Master Source Agent: Finance Team
Mechanisms: System Assisted
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Process ID # Description Type
Elementary Business Function
ResultAgent Status
AP001.01 Check whether the supplier exists in the system or not.
Internal – System Assisted. Use PIN number to be unique. Field should be mandatory
Supplier Account Query and Check Finance Team
Active
AP001.02 Inquire a Supplier record in the system with appropriate information such as Name or Number or etc.
Internal – System Assisted
Supplier Account Result of Supplier query
Finance Team
Active
AP001.03 If the supplier is not defined, enter necessary details such as Supplier name, supplier type, Bank account etc
Internal – Manual Supplier/Employee Account
Supplier details entered
Finance Team
Active
AP001.04 Supplier details created with automatic supplier number.
Internal – System Assisted
Supplier/Employee Account
Record Created Finance Team
Active
1.2 Creating Standard Invoice – With Purchase Order/ GRN (AP002)
Process: Standard Invoice –With Purchase Order (PO)
Business Function: Accounts Payable
Date : June-2-2013
Mapping Team: ORAERP COM INC. Process Owner: Finance Team
Librarian: Priority (H, M, L): High
Core (Y/N)Yes
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Process Number: AP002 Description: This Process explains creation of standard invoice, which has approved purchase order/ Receipt.
Assumptions: In ORAERP COM INC. invoices are created at operating unit level and are either matched with the PO or receipt.
Event Description: This process is triggered when we receive the material from the supplier.
Number:AP.002 Type: Transaction Source Agent: Finance Team
Mechanisms: System Assisted
Process ID # Description Type
ElementaryBusiness Function Result Agent Status
AP002.01 Receive the Invoice from Supplier. Internal – Manual Standard Invoice –With PO
Invoice is available for entering into the system.
Finance Team Active
AP002.02 Enter the Invoice transaction into the system. Internal – System Assisted
Standard Invoice –With PO
Invoice available for matching to PO and receipt
Finance Team Active
AP002.04 If it is a foreign currency invoice, enter the invoice amount in foreign currency. System should be able to convert it into functional
Internal – System Assisted
Standard Invoice –With PO
Invoice entered in the system
Finance Team Active
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Process ID # Description Type
ElementaryBusiness Function Result Agent Status
currency automatically based on corporate/user/spot rates.
AP002.05 Invoice currency should be same as PO/GRN Currency.
Internal – System Assisted
Standard Invoice –With PO
Invoice entered in the system
Finance Team Active
AP002.06 Payment currency should be same as Invoice currency.
Internal – System Assisted
Standard Invoice –With PO
Invoice entered in the system
Finance Team Active
AP002.07 Matching of the Invoice with PO and Receipt based on 2-way/3-way/4-way. The matching will be based on the supplier.
Internal – System Assisted
Standard Invoice –With PO
Matched Invoice with PO / Receipt.
Finance Team Active
AP002.08 Validate the Invoice. System would validate whether the invoice quantity and amount are same as PO /GRN
Internal – System Assisted
Standard Invoice –With PO
Invoice is validated
Finance Team Active
AP002.09 If some information is needed for the invoice, place a hold manually till receiving the information.
Internal – System Assisted
Standard Invoice –With PO
Hold placed manually.
Finance Team Active
AP002.11 Create Accounting for the Invoice and transfer the journal entries in detail to General Ledger.
Internal – System Assisted
Standard Invoice –With PO
Accounting entries Created.
Finance Team Active
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1.3 Creating Standard Invoice – Without Purchase Order (AP003)
Process: Standard Invoice –Without Purchase Order
Business Function: Accounts Payable Date : June-2-2013
Mapping Team: ADBC Company Process Owner: Finance Team
Librarian: Priority (H, M, L): High
Core (Y/N)Yes
Process Number: AP003 Description: This Process explains creation of Standard Invoice, which does not have purchase order.
Assumptions: In ADCB supplier invoices are created at operating unit level and the invoice lines and distributions are created manually.
Event Description: This process is triggered when the services are received/any expenses incurred
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Number:AP.03 Type: Transaction Source Agent: Finance Team
Mechanisms: System Assisted
Process ID # Description Type
ElementaryBusiness Function Result Agent Status
AP003.01 Receive the invoices from supplier or other concerned department.
Internal – Manual Standard Invoice –Without PO
Invoice is available for recording into system
Finance Team Active
AP003.02 Record a Standard Invoice details into the system with the correct expense account.
Internal – System Assisted Standard Invoice –Without PO
Invoice entered in the system
Finance Team Active
AP003.03 If it is a foreign currency invoice, enter the invoice amount in foreign currency. System should be able to convert it into functional currency automatically based on corporate/user/spot rates.
Internal – System Assisted Standard Invoice –Without PO
Invoice entered in the system
Finance Team Active
AP003.04 Payment currency should be same as Invoice currency.
Internal – System Assisted Standard Invoice –With PO
Invoice entered in the system
Finance Team Active
AP003.05 Validate the Invoice in the System. Internal – System Assisted Standard Invoice –Without PO
Invoice is available for approval
Finance Team Active
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Process ID # Description Type
ElementaryBusiness Function Result Agent Status
AP003.07 Create Accounting for the Invoice and transfer the Journal Entries to General Ledger
Internal – System Assisted Standard Invoice –Without PO
Accounting entries generated
Finance Team Active
AP003.10 System should allow defining distribution sets and assigning them to Supplier/Invoice.
Internal – System Assisted Distribution Sets Distribution Sets defined and assigned
Finance Team Active
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1.4 Creating Prepayment Invoice (AP004)
Process: Prepayment Invoice Business Function: Accounts Payable Date : June-2-2013
Mapping Team : ADBC Company Process Owner: Finance Team
Librarian: Priority (H, M, L): High Core (Y/N)Yes
Process Number: AP004 Description: This Process explains the creation of prepayments, which are treated as advance payment to suppliers/ employees.
Assumptions: ADBC pays advances to the suppliers and employees.
Event Description: This process is triggered when there are any advance payments to be made to the suppliers/ employees
Number:AP.04 Type: Transaction Source Agent: Finance Team
Mechanisms: System Assisted
Process ID # Description Type
ElementaryBusiness Function Result Agent Status
AP004.01 Receive contractual agreement for making the Internal – Manual Advance Payment Prepayment Finance Team Active17
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Process ID # Description Type
ElementaryBusiness Function Result Agent Status
advance payment Invoice is available for recording into the system.
AP004.02 Enter a Advance / Prepayment Invoice into the system
Internal – System Assisted Advance Payment Prepayment invoice is created.
Finance Team Active
AP004.03 Provide a Descriptive Flex field to capture PO, Reference details. The list should link to the PO, If it is to be referred to PO.
Internal – System Assisted Advance Payment DFF data is captured.
Finance Team Active
AP004.04 Validate the Prepayment Invoice. Internal – System Assisted Advance Payment Prepayment is validated
Finance Team Active
AP004.05 Approve the Prepayment in the system Internal – System Assisted Advance Payment Prepayment is available for payment
Finance Team Active
AP004.06 Create Accounting for Prepayment Internal – System Assisted Advance Payment Prepayment Liability Clearing is created.
Finance Team Active
AP004.07 Record a payment transaction into the System Internal – System Assisted Advance Payment Prepayment Available for application
Finance Team Active
AP004.08 Apply the prepayment upon receiving the invoice from Vendor.
Internal – System Assisted Advance Payment Prepayment Applied
Finance Team Active
AP004.09 Create the Accounting and transfer the entire Internal – System Assisted Prepayment Alert is sent Finance Team Active
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Process ID # Description Type
ElementaryBusiness Function Result Agent Status
to General Ledger
1.5 Entering Credit Memo (AP005)
Process: Entering Credit Memo Business Function: Accounts Payable Date : June-2-2013
Mapping Team: ORAERP COM INC. Process Owner: Finance Team
Librarian: Priority (H, M, L): High Core (Y/N)Yes
Process Number: AP005 Description: This process explains entering Credit memo.
Assumptions: Standard invoice/material is returned to the supplier
Event Description: This process is triggered if any purchase returns are there.
Number:AP.005 Type: Transaction Source Agent: Finance Team
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Mechanisms: System Assisted
Process ID # Description Type
ElementaryBusiness Function Result Agent Status
AP005.01 Receive details of Credit t note from the supplier or the concerned department
Internal – Manual Entering Credit Memo
Credit memo is available for recording into the system
Finance Team Active
AP005.02 Create a Credit Note transaction into the system with negative value and match to a PO if there was a PO
Internal – System Assisted Entering Credit Memo
Credit Memo is created.
Finance Team Active
AP005.03 Validate the Credit Note in the system. Internal – System Assisted Entering Credit Memo
Credit Memo Validated
Finance Team Active
AP005.04 Approve the Credit Note in the system Internal – System Assisted Entering Credit Memo
Credit note is available for refund/adjustment
Finance Team Active
AP005.05 Create Accounting and Transfer to GL Internal – System Assisted Entering Credit Memo
Accounting is created
Finance Team Active
1.6 Payment (AP006)
Process: Entering Payments Business Function: Accounts Payable Date : June-2-2013
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Mapping Team: ADBC Company Process Owner: Finance Team
Librarian: Priority (H, M, L): High
Core (Y/N)Yes
Process Number: AP006 Description: This explains the processing of supplier/employee payments for making invoice payments.
Assumptions: ADBC makes payments in different types like cash, check, bank transfer, L/C
Event Description: This process is triggered when the invoices are to be paid
Number:AP.006 Type: Transaction Source Agent: Finance Team
Mechanisms: System Assisted
Process ID # Description Type
ElementaryBusiness Function Result Agent Status
AP009.01 Enter the payment details of the supplier like payment amount, bank etc.
Internal – System Assisted Payment Payment voucher is created
Finance Team Active
AP009.02 System should be able to print Checks (Pre Internal – System Assisted Payment Payment Finance Team Active
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Process ID # Description Type
ElementaryBusiness Function Result Agent Status
printed running stationery) on payment. voucher is created
AP009.03 ADBC does payment by Check Payments mostly and cash payments very rarely.
Internal – System Assisted Payment Payment voucher is created
Finance Team Active
AP009.04 Payment currency should be same as Invoice currency.
Internal – System Assisted Standard Invoice –With PO
Invoice entered in the system
Finance Team Active
AP009.05 Create accounting and Transfer to GL. It updates the Bank Accounts and Realized Gain/Loss
Internal – System Assisted Payment Accounting is created.
Finance Team Active
AP009.06 System should allow users to void/cancel a payment.
Internal – System Assisted Payment Payment is canceled/void.
Finance Team Active
AP009.07 System should print remittance advice on payment.
Internal – System Assisted Payment Remittance advice is printed.
Finance Team Active
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2. BUSINESS PROCESS DIAGRAM
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Start
System will automatically create distribution line
Receive the Invoice from Supplier
Match the Invoice Information with GRN
Approve the Invoice
Create Accounting & Run Transfer to GL Program
Run Mass Addition Program to Populate Asset Information to FA Module
Run Mass Addition Create Report to view Information transferred to FA Module
RD.050 Business Requirements Scenarios Doc. Ref: RD.050
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2.1 Invoice Process for Asset Creation:
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2.2 Invoice Payment Process:
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