Supply Chain Management

Creating Purchase Requisitions and Purchase Orders

Creating Purchase Requisitions

In this section, you will learn to manually create purchase requisitions, which are
internal requests for purchase orders. Manual purchase requisitions are initiated by
the requestor, with requisition lines for each requested item. If the preparer—the
person who enters the purchase requisition—is different from the requestor, then
Oracle Purchasing will record both employees.

·        Create a purchase requisition

·        Set up requisition template
·        Use the Order Pad in the Supplier Item Catalog
Creating a Purchase Requisition

Online requisitions eliminate paper and allow the buyer to minimize data entry by
converting online requisitions to purchase orders, with minimal keystrokes.
Purchase requisition has three levels in Oracle Purchasing.

It has a requisition header that has the requisition type, description, status, and
total

Each requisition header has requisition lines that contain the items, need-by
date, price, and quantity

Each requisition line has distributions that have the charge account, budget
account, variance account, accrual account, and project-related information.
Purchase requisition lines in Oracle Purchasing can automatically create
purchase orders with the AutoCreate function once the requisition has been
approved. The navigation path to the Requisition window is Requisitions:
Requisitions
Requisitions (Currency) screen
Click on Distributions
 Click on Approve

Click on the Approve button to approve your requisition and the

Approve Document window will open
Setting Up a Requisition Template

Requisition templates are used to streamline the entry of requisition lines. They can
be created for all frequently ordered items, or even from an existing requisition, thus
saving time and preventing possible errors.

The navigation path to the Requisition Templates window is Setup: Purchasing:

Requisition Templates.
If you want to inactivate the template on a certain date, then enter an inactive
date. Otherwise, leave the field blank. Then, enter Internal or Purchase for the
requisition type. If you selected Yes in the Reserve PO Number field when the
requisition was created, then the system will reserve a purchase order number.
Requisition Templates screen
To copy lines to a template, click on the Copy button at the bottom of the
window to open the Base Document window.

You can use the List of Values to select the base document type of Purchase Order
or Requisition. Enter the base document number from which you want to copy lines
over to the template. Click on the OK button to copy all lines of the base document
onto the template. Click on the Cancel button to return to the Requisition
Templates window without copying. You can perform this operation on multiple
documents in one template.

Base Document form

Using the Order Pad in the Supplier Item Catalog
Using the Order Pad, you can enter requisition lines by clicking on the Catalog
button to open the Search Supplier Item Catalog window. This allows for a search
of catalog items by commodity, requisition template, category set, category, item
with revision, item description, supplier, supplier site, supplier item, due date,
deliver-to organization, line type, deliver-to locations, UOM, or currency. To use
requisition templates, select the desired requisition template and click on the Find
button. To use other search criteria, enter them and click on the Find button.

Supplier Item Catalog form

Once the search has retrieved past purchases or requisition templates, select the
lines to place on your Order Pad. Click your cursor on the down arrow of the Order
Pad and the lines will be filled into the Order Pad. Alternately, you can double-click
on the supplier item you want to purchase to fill in the Order Pad. You can use the
Eraser icon on the top toolbar to erase any line from the Order Pad. Then, enter the
quantity, price, need-by date, organization, location, destination type, and
subinventory on your Order Pad line. You can use the Options form to enter default
values, and you can select as many supplier items you want. Click on the Select
button to add the lines to your requisition—this action will close the Supplier Item
Catalog window—then return to completing your requisition. If you want to see the
order total, click on the Order Total button.

You can check the Select Price Only checkbox in order to only select price from
the Supplier Item Catalog. In this case, you will not be able to use the Order Pad.
Once you have saved the requisition, your only option is to enable Select Price
Only.
Through the Order Pad Options window, you can control the default values used
in the Order Pad. This is done by clicking on the Options button when using the
Order Pad. In the Options window, you can specify default options: whether to
default from options or from the previous line. You can also specify the default
need-by date, destination type, organization, location, requestor, subinventory,
and expense charge account.
Order Pad Options form

Once you are done with the

Order Pad, you can either
click on the Select button to
bring the selected catalog
items back to the purchase
requisition, or you can click
on the Close Catalog button
to cancel the selection.
 Creating Standard Purchase Orders
Creating a Standard Purchase Order
The purchase order has a header that consists of one or more lines. Each line
can consist of one or more shipments, and each shipment can consist of one or
more distributions.
The purchase order header contains supplier, supplier site, and purchase order
type information. Lines contain information about the items, shipments define
where the purchasing line ships, and distributions define the deliver-to
locations. In other words, the purchase order contains one more level than a
requisition and includes the header, line, shipment, and distribution level. The
requisition contains the header, line, and distribution level. At the start of each
session, set the purchase order preferences that will default values to your
purchase order, just like you would for requisitions.

You must be defined as a buyer to create purchase orders.

To create a standard purchase order and open the Purchase Orders window,
follow the navigation path Purchase Orders: Purchase Orders.
Currency form

Terms and Conditions form

Purchase Orders (Items) form
Purchase Orders (Price Reference) form
Purchase Orders (Reference Documents) form
Shipments (Shipments) form
Shipments (Status) form
Receiving Controls form
The receiving control options you enter in this
form will override the site settings in the
receiving controls setup or profile options.
Define the receipt window by the Days Early
and Days Late fields, and determine if your
users are receiving outside of the receipt
window, whether your user should receive a
warning, no warning, or rejection. You can also
enter the maximum acceptable over-receipt
tolerance percent. Next, enter whether your
user should receive a warning, no warning, or
rejection when the quantity is over the over-
receipt tolerance percent. You can also
determine whether substitute items can be
received, what the receipt routing should be,
and whether the receiving location must be the
same as the ship-to location. If the receiving
location is not the same as the ship-to location,
then you can choose whether you will receive
a warning, no warning, or rejection. Click on
the OK button to accept the entered receiving
controls or click on the Cancel button to cancel
the entered defaults.
Approve Document form
To approve the purchase order, click on the Approve button. You will move to the
Approve Document window, where you can check the Submit for Approval box and
click on the OK button. The purchase order will move through Workflow, and the
status will change to In-Process and then Approved once the order has been
approved. When approved, you can receive against the purchase order. You can
also forward the purchase order to another employee, add a note, or print the
purchase order. Check the Submit for Approval checkbox and click on the OK button
to approve the document. You will receive a message stating that the document has
been submitted for approval.
Entering Purchase Order Receipts
In this section, you will learn how to receive against your purchase order. When
the goods arrive, you must alert Oracle Purchasing that the goods have been
received against the PO. To do this, you must enter receipts into the system. In
this section, you will learn to:
·        Find expected receipts
·        Receive an item (Manual, Express, Cascade)
·        Receive unordered items
·        Receive substitute items
·        Define payment-on-receipt options
·        Define EDI options
Finding Expected Receipts
Use the Find Expected Receipts window to locate source documents for which you
can enter receipts. You must enter the appropriate search criteria: the more
information you include, the more restrictive the search will be. Expected receipts
are those purchase orders that are expected to have goods or services arrive. To go
to the Find Expected Receipts window, follow the navigation path Receiving :
Receipts.
Receiving an Item (Manual, Express, Cascade)

Oracle receives in three different ways: Manual, Express, and Cascade. With the
Manual function, all data is inputted manually. The Express method is quicker and
requires fewer keystrokes when entering receipts with a specified purchase order.
The Cascade function assists in distributing the quantity of a receipt from a single
supplier to multiple shipments and distributions. This method also is only available
if you have a specified source document.

Manual
Receiving actions for purchase orders are dependent on the purchase order type.
Purchasing can designate no receipt for nonmaterial (service) POs (two-way
matching). Expense POs can be set up for direct receipt (three-way matching),
and inventory POs can be direct received or go through an inspection process
(four-way matching).
Receipts (Lines) form
Express
Once you have located the expected receipts, click on the Express button to
perform an express receipt. In the Express Details window, select the destination
type: Final Destination or Receiving Location. Click on the OK button, which
changes the Express button to Unexpress and selects all express receipt lines.
Deselect the lines to omit them from the express receipt. Upon saving your work,
the system will validate your express receipt.

Cascade
Once you have located the expected receipts, click on the Cascade button to
perform a cascade receipt. Enter the total quantity expected in the Cascade Details
window, and enter the unit of measure. Click on OK button and the quantity will
cascade line to line until the total quantity is received.
Use the Special | Movement Statistics menu command to capture movement
statistics for Oracle Inventory. To view your receiving activity, go to the Receiving
Transactions summary window. The navigation path is Receiving : Receiving
Transactions. Enter your receipt number first, click on the transactions, click on the
Receipt Details button (in the alternative region), then click on the Find button.
Receiving Unordered Items
With this function, you can receive shipments from your suppliers if a purchase order
is missing, or if you are not sure which purchase order to receive the shipment
against. This allows for the receipt and tracking of shipments in Oracle while a
decision is made as to which purchase order to receive the shipment.
The navigation path to the Find Expected Receipts window is Receiving : Receipts.
When the Find Expected Receipts window appears, click on the Unordered button
on the bottom of the form. The Receipts Header window will open, just like it does
with regular receipts.
Receiving Substitute Items
If you allow for the receipt of substitute items, you can enter the substitute
item during receiving. These are items that can be replaced or that are
interchangeable with other items in the system.
Use the Find Expected Receipts window to find source documents for which
you can enter substitute receipts, then enter the appropriate amount of
search criteria. The more information you include, the more restrictive the
search will be.
The navigation path to the Find Expected Receipts window is Receiving :
Receipts. Refer to Find Expected Receipts to locate your source document,
then use the Find Expected Receipts window to specify your search criteria.
In the Receipts window, select the line on which you wish to receive
substitute items. In the Item field, use the List of Values to select the
substitute item. If the item does not appear in the List of Values, you will not
be able to continue with this receipt. Once you have selected the proper
substitute item, click on the OK button. The Item field on the Receipts
window will change to the substitute item number. Continue your receiving
transactions as required.
Defining Payment-on-Receipt Options
Oracle Purchasing and Oracle Payables work together to streamline the payment
to suppliers based on receipt transactions. You can set up your suppliers to be
paid on receipt or delivery with the Purchasing alternative region in the Supplier
form. If the suppliers are pay on receipt or pay on delivery, you can also select the
level of invoice consolidation—packing slip, receipt, or across all for a supplier site
—and whether consolidated invoice should be created after receipt or delivery
transaction creation. Pay on receipt means that invoices can be generated after
receiving, and pay on delivery means that invoices can be generated after
receiving and delivering. Consolidation by packing slip means that one invoice is
created by the same packing slip number entered. Oracle Purchasing will
automatically create an invoice in Oracle Payables and match it to the
corresponding purchase order. The invoices will be paid following the standard
payment functionality in Oracle Payables.
You must run the Payment on Receipt program to automatically create the
invoices for the payment-on-receipt suppliers as described above. Returns and
receipt adjustment transactions debit memos are not automatically created once
an invoice has been generated using the Payment on Receipt program.
Tip: Strong internal controls, discipline, and supplier integrity should be in place to
enable this function in your system.
Defining EDI options
You can define EDI (Electronic Data Interchange) options at the supplier and the
supplier site level. If the supplier or the supplier sites are paid via EDI, you must
specify the appropriate options for the supplier or the supplier. EDI options
include the following:

·        Payment method

·        Payment format
·        Remittance method
·        Remittance instruction
·        Transaction handling
Payment Method
This is the method by which electronic payments will be made. Valid choices include
Automated Clearing House (ACH), Bankers Automated Clearing System (BACS), Financial
Institution Option (BOP), Wire transfer via CHIPS (CWT), Wire Transfer using FED wire
method 1 (FEW), Wire transfer via FED wire method 2 (FWT), Wire transfer using SWIFT
network (SWT), or Other Method (ZZZ).
Payment Format
This is the format that indicates the information type that will be transmitted with the funds
if the payment method is ACH. Valid choices include Cash Concentration/Disbursement
(CCD), cash concentration/Disbursement plus Addenda (CCP), Corporate Trade Payment
(CTP), Corporate Trade Exchange (CTX), Prearranged payment and Deposit (PPD), or
Prearranged payment and Deposit plus addenda (PPP).
Remittance Method
This is the method that determines which party is responsibility for sending the remittance
advice. Valid choices include EDI to payer’s bank, EDI to payee’s bank, EDI to payee, EDI
to Third Party, or Do not route.
Remittance Instruction
Remittance instruction, as its name implies, is used to capture instructions for an
intermediary or recipient bank.
Transaction Handling
This is the ANSI ASC X12 EDI transaction code to classify how the transaction should be
handled. Valid choices include Payment Accompanies Remittance Advice(C), Make
Payment Only (D), Remittance Information Only (I), Split Payment and Remittance (U), or
Other Handling (Z).
Thank You!