Prepayments

• A supplier might send an invoice that references a prepayment. If a supplier reduces the invoice amount by the amount of the prepayment and associated tax, you can use the Prepayment on Invoice feature to enter the invoice.
• You can enter two types of prepayments: Temporary and Permanent. Temporary prepayments can be applied to invoices or expense reports you receive. For example, you use a Temporary prepayment to pay a hotel a catering deposit. When the hotel's invoice arrives, apply the prepayment to the invoice to reduce the invoice amount you pay. Permanent prepayments cannot be applied to invoices. For example, you use a Permanent prepayment to pay a lease deposit for which you do not expect to be invoiced.
• The default ‘Settlement Date’ is calculated based on Prepayment Settlement Days Payables option. You can update this value.
• In the Invoice Workbench you can enter and apply prepayments. In the Quick Invoices window you cannot enter prepayments, but you can apply existing prepayments to invoices you enter.

 

1. On a prepayment, you can enter any number of distributions, either manually, or automatically by purchase order matching, distribution sets, or allocating. You can also take discounts on prepayments.
2. You can apply paid Temporary prepayments on and after the prepayment settlement date. You can apply only Item distributions from the prepayment. The prepayment remains available until you apply the full amount of the prepayment Item distributions to one or more invoices. You can review the Prepayment Status Report to check the status of all prepayments in Payables.
3. When you enter a Standard invoice in the Invoice Workbench, or enter an expense report in the Expense Reports window, Payables notifies you if you have available prepayments for the same supplier.
4. You apply prepayments to invoices and expense reports differently, depending on where you enter them: Invoice Workbench, Quick Invoices, Expense Reports window, or Oracle Internet Expenses

When you enter a prepayment, Payables provides a default repayment account for each Item distribution. During prepayment entry, you can override the accounts Payables provides.
Payables looks in the following order and uses the first valid prepayment account it finds: supplier site, supplier, Financials option.
However, if the prepayment is purchase order matched and if the Build Prepayment Accounts When Matching Payables option is enabled, then Payables builds each account for you and defaults the built account if it is a valid accounting combination.