Process

[Former Member]

hi folks,

Currently I am looking into two processes ' Order To Cash' and 'Purchase To Pay'? can anyone help me how these porcesses are run? I need some information for these.

Thanks in advance guys.

Santhosh.

[Former Member]

These are not system processes, but they are business processes. So when you talk about the business process of "Order to Cash", you are actually looking at various transactions within that process.

Depending on the situation, it may start from a 'Enquiry' from a customer about a product. Once you give the information requested by the customer, then he may ask for a 'Quotation', then once confirmed, you will create a sales order. Here it can deviate into production(if you make-to-order) or even purchasing(if you make through subcontractors). Once the product is ready to be delivered, you will create a 'delivery', issue the goods (to transfer the ownership) by doing a PGI, then create a shipment(if you track to that extent) and so on so forth. At an agreed upon stage of this process, you will create a billing document(either proforma invoice or an actual SD invoice). This will then result in an accounting invoice to do the necessary entries in the GL accounts. When the customer pays, then you will enter the payments into the system thus ending the process. There will be several versions of this process, but overall this is what it is. You will be looking at the SD module and FI module in this case.

"Purchase to Pay" process is the other side of the spectrum where you are the customer placing an order with your vendor. So it can start with the same kind of mirrored activities like RFP, RFQ, Requisition, PO, Inbound deliveries, Goods Reciepts, Posting Vendor Payments and subsequent actual payment.

Hope this clears some of your doubts.

Srinivas

[Former Member]

Thanks for your response Srinivas,

Do you mean to say it is the process taking throguh Quotation- sales order - delivery - generating an invoice- creating a billing document to the final posting into the G/L accounts ???

Purchase To Pay the same step process where i am the customer placing an order with the vendor.

I hope I am right here....

Vinu

[Former Member]

Procure To Pay (PTP) is the whole process from the time you place request for procuring goods till you pay for the goods received! In include the following activities:

<b>Request For Quotation

Create/Send Purchase Order

Invoice Receipt

Invoice Verification

Payment</b>

Order To Cash (OTC) is the process which includes activities like:

<b>Create Sales Order

Create Delivery

Picking / Packing

Goods Issue

Create Invoice

Receive Payments - AR

Cash Payments - AR</b>

[Former Member]

Thank you Sam for the information. the informations helped.

vinu.