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AP/AR Netting
Netting
When a trading partner is both a customer and a
supplier, you may choose to offset open receivables’
against open payables’ items.
 Netting Agreements add trading partner terms as well as
deploying company controls.
A selection program automatically pulls information from
Oracle Receivables and Oracle Payables taking into
consideration discounts, late fees, and withholding taxes
prior to determining the final netting amount.
 A review process and trading partner approval afford
further verification to support the netting event.
Per-Requisites
Setups Required for AP/AR Netting -
  Define netting control account
  Receivables System Options
  Create bank- “Netting Account” flag to Yes
  Receipt class -‘AP/AR Netting’
  Attach your bank account in this receipt class
  Netting Batch Approver
  Profile: Chargeable Subcontracting Enabled
  Document sequencing for AP & AR
  Netting Agreement
Receivables System Options-
Enable check box “Allow Payment of Unrelated
               Transactions”
Netting Bank Account
Receipt Class –
Creation Method AP/AR Netting
Attach Bank Account to Receipt Class
Profile Option: Chargeable Subcontracting Enabled


“Yes”- Only invoices that were matched to purchase
orders with outsourced assemblies would be selected by
the netting process.
“No”- Only invoices that were matched to purchase
orders without outsourced assemblies would be
selected by the netting process.
“D”- All eligible invoices will be selected for netting
irrespective of whether or not they are matched to
purchase orders.
Document Sequencing
Category
Receivables- AP/AR Netting
Payables- Netting payments
Netting Agreement
Payables -> Payment -> Netting
Receivables -> Receipt -> Netting
Entering Netting Batch
Request
Create Netting Batch
Settle Netting Batch
Netting Data Extract
Query Receipt
Query Payments

Note- No Payment Document is to be Attached

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AP/AR Netting R12

  • 2. Netting When a trading partner is both a customer and a supplier, you may choose to offset open receivables’ against open payables’ items. Netting Agreements add trading partner terms as well as deploying company controls. A selection program automatically pulls information from Oracle Receivables and Oracle Payables taking into consideration discounts, late fees, and withholding taxes prior to determining the final netting amount. A review process and trading partner approval afford further verification to support the netting event.
  • 3. Per-Requisites Setups Required for AP/AR Netting - Define netting control account Receivables System Options Create bank- “Netting Account” flag to Yes Receipt class -‘AP/AR Netting’ Attach your bank account in this receipt class Netting Batch Approver Profile: Chargeable Subcontracting Enabled Document sequencing for AP & AR Netting Agreement
  • 4. Receivables System Options- Enable check box “Allow Payment of Unrelated Transactions”
  • 6. Receipt Class – Creation Method AP/AR Netting
  • 7. Attach Bank Account to Receipt Class
  • 8. Profile Option: Chargeable Subcontracting Enabled “Yes”- Only invoices that were matched to purchase orders with outsourced assemblies would be selected by the netting process. “No”- Only invoices that were matched to purchase orders without outsourced assemblies would be selected by the netting process. “D”- All eligible invoices will be selected for netting irrespective of whether or not they are matched to purchase orders.
  • 9. Document Sequencing Category Receivables- AP/AR Netting Payables- Netting payments
  • 10. Netting Agreement Payables -> Payment -> Netting Receivables -> Receipt -> Netting
  • 11.
  • 12.
  • 14. Request Create Netting Batch Settle Netting Batch Netting Data Extract
  • 16. Query Payments Note- No Payment Document is to be Attached