Payables & Cash Management

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Topic

    Gary Jones
    Centralized Payments across LE'sAnswered
    Topic posted June 14, 2017 by Gary Jones, last edited January 30, 2019, tagged Intercompany, Payables 
    290 Views, 8 Comments
    Title:
    Centralized Payments across LE's
    Summary:
    Unable to set up a Service Provider relationship for Payments Processing (Across Ledgers/LE's)
    Content:

    Does anyone perhaps know if it is possible to set up "Service Provider" relationships with Business units attached to a different Default LE and Ledger.

    In the help docs and user guides there are examples of an example of a BU in Japan making payments for a BU based in the US. I am unable to set this up.

     

    Any help would be appreciated.

    Best Comment

    Becky Alvarez

    Here is a write up on Centralized Payment Processing.  Your issue is that you have separate Ledgers and that is preventing you from doing this.

     

    Centralized payment processing enables you to implement a shared payment service model.

    Under this model, a single payment business unit provides payment services to multiple invoice business units. That is, any business unit with the Payables Payment business function can provide payment services to other business units with the Payables Invoicing business function.

    The designated payment business unit processes invoices from multiple invoice business units and generates a consolidated payment for a given supplier. Because payment processing is centralized, you can exercise better control of supplier payments and reduce the cost of payment processing.
     
    Payments can be processed across all business units within the same Ledger.  These business units must share the same Ledger, Chart of Accounts and Calendar.
    • A BU has one and only one Ledger
    • A Ledger can be assigned to many BUs
    • Any LE can be used with a BU as long as the Ledgers are the same
     
    The different models of payment services that you can implement are:
    • Dedicated - only services other BUs
    • Self-Service - only services itself

    • Dedicated and Self-Service - services itself and other BUs
     
    To Pay Across LE
    • Ledgers must be the same
     
    Cannot Pay Across Ledgers.

    Comment

     

    • Becky Alvarez

      Here is a write up on Centralized Payment Processing.  Your issue is that you have separate Ledgers and that is preventing you from doing this.

       

      Centralized payment processing enables you to implement a shared payment service model.

      Under this model, a single payment business unit provides payment services to multiple invoice business units. That is, any business unit with the Payables Payment business function can provide payment services to other business units with the Payables Invoicing business function.

      The designated payment business unit processes invoices from multiple invoice business units and generates a consolidated payment for a given supplier. Because payment processing is centralized, you can exercise better control of supplier payments and reduce the cost of payment processing.
       
      Payments can be processed across all business units within the same Ledger.  These business units must share the same Ledger, Chart of Accounts and Calendar.
      • A BU has one and only one Ledger
      • A Ledger can be assigned to many BUs
      • Any LE can be used with a BU as long as the Ledgers are the same
       
      The different models of payment services that you can implement are:
      • Dedicated - only services other BUs
      • Self-Service - only services itself

      • Dedicated and Self-Service - services itself and other BUs
       
      To Pay Across LE
      • Ledgers must be the same
       
      Cannot Pay Across Ledgers.
      • Gary Jones

        Hi Becky

        Thanks so much for your response on my question. It is clear now that the centralised payments processing is limited to cross-LE's and is not available across ledgers. We will need to develop a workaround somehow using intracompany processing for my client.

        Just an observation. In the help documentation available inside the application, there is a section entitled: Centralised Payment Processing Across Business Units: Explained

        This section shows a payment relationship between a BU in the UK and another in Japan. (See screenshot attached). This is actually incorrect as it is not likely that these two entities would share the same ledger.

         

        Thanks again

         

        • Manpreet Gill

          Hi Gary,

          Were you able to manage using any workaround? If yes, then what is your proposed solution?

          Kind regards,

          Manpreet

    • Gopinath Kartheesan

      Hi Becky, I read another note from the "Oracle Financials Shared services Centers.pdf" document and it's mentioned that Cross Ledger payments can be done using a Treasury application.  Is that correct?

       

      Supplier Payments
      A business unit with the Payables Payment business function can provide the invoice payment service to business units with the Payables Invoicing business function that reside in the same ledger. Cross ledger payments (implying cross country payments since best practice is to define a single ledger per country) would normally be handled by a treasury application.

    • Becky Alvarez

      Since we don't have a Treasury Application in Cloud Financials, I would say yes but that does't help you.  We will need to see what the integration with Reval provides.  If they do this then I would recommend to use Reval for cross ledger payments and integrate that into Cloud Financials once that integration project has been completed.   I don't have a release date as of yet but it is on our road map.

    • Gopinath Kartheesan

      Thanks Becky, that helps.

    • Ashish Kale

      Hi Becky - We have similar scenario of different Ledgers, could you please share the link to above write up for Centralized Payment Processing, for reference.

    • Becky Alvarez

      Yes.  You can find all of our white papers here.  The one you are looking for is last one Oracle Financials Cloud: Shared Service Centers (SSC).