Objectives

• To understand the requirements for enabling purchase order prepays.

• To understand how they work

• To understand how they appear in ledger

General Overview of PO Prepay Request

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Purchase Order Prepay Request Setup

System Security Setup

Customize > System Security > Select User/Users > Edit Security Levels There are 4 new security options to enable Purchase Order Prepay processing:

1. Third-tier security under INV, Stock Additions
   "Apply Prepayments"
   Minimum security level is 3 (Process)
   This security option enables the Prepayments button in Stock Additions
   
   

2. Third-tier security under INV, Purchase Orders
   "Request Prepayments"
   Minimum security level is 1 (View)
   User must have at least security level 2 (Add) to create vouchers
   This security option enables the Request Prepay button in Purchase Orders
   
   
   

3. Third-tier security under ACP, Disbursement Processing
   "Create PO Prepayment"
   Minimum security level is 2 (Add)
   This security option enables a user to add purchase order prepayments
   
   

4. Third-tier security under ACP, Disbursement Processing
   "Reclassify Prepayments"
   Minimum security level is 3 (Process)
   This security option enables a user to reclassify prepayments in A/P and Inventory
   
   
   

Accounts Payable Setup

Packages>Setup Information>Voucher Types Create a new Voucher Type for your prepay requests

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Packages>Setup Information>General Information> Screen 1 of 3

Set the Voucher document types for the Prepay Request

Set the voucher range for the prepay request

Once the default is set, the system will assign each prepay request a voucher number from that range.

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Packages>Setup Information>General Information> Screen 3 of 3
Default Prepay Request Voucher Status > Actual/Estimate.

This question will set the status on all prepay requests created during Purchase Order additions or edits.

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Ledger Setup

Ledger > Maintenance Options > Chart of Account > Add new account
This account will be in the range of accounts payable account but it is a holding account. It holds the debit portion of the voucher created for AP to request payment.
Use a separate account or accounts payable subsidiary will NOT balance to the ledger.

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System Journal Interface Setup

System Accounts>Accounts Payable>Transaction Code mapping
Map the "prepay request vouchers" to a AP Prepay Payable account. This is a holding account. It is not your Accounts Payable ledger account or your prepay account. It needs to be a separate holding ledger account.

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Using Prepay Requests

• Setup Security to see Prepay Request button on Purchase Order

• INV > Purchase Order > Select Vendor > Key items and cost

• Purchase Order Summary Screen will show Prepay Request Button

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• By selecting the Prepay Request button you will be able to key in how much is being prepaid (in either a percent or an amount) and when the prepaid money is due.

• This will create a Prepay Request voucher type, increasing AP for the voucher and debiting the AP Prepaid Request Holding account.

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• Upon Completion of the Purchase Order, the inventory on order balance is updated and (depending on your inventory setup) your balance Available is increased.
  
  

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• This is the advantage to keying in a purchase order. It does affect your physical inventory balances.
  
  

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• Keying in a purchase order also affects your inventory position reports.INV > Report Manager > Inventory Position Reports > Standard > Inventory Availability Projection

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• Upon completion of the purchase order prepay request, accounts payable balance is increased by the voucher and request for payment is made.
  
  

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• When the voucher is ready for disbursement, the user will pay for the voucher just like a normal voucher.

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Using Purchase Order Prepays

• Enter a Purchase Order to lock in Quantity and Cost

• In ACP > Disbursements > enter vendor name id > select Option 3) Prepayment for Purchase Order. This will display all Prepay Request voucher for that vendor.

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• The system will create prepayments checks based off the existing PO's in the system. So you do not have to use Prepay Request Vouchers. You can just enter a Purchase Order Prepay to lock in quantity and price, then issue a prepay disbursement against that voucher.

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• The prepay is increased on the AP Balance and the record is attached to the purchase order.No voucher is created.

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Applying Prepays to Stock Addition Vouchers

At Voucher Entry

• Upon Flagging the voucher as Actual, a Prepayment Application Button will appear.

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• Select the Prepayments button type to bring up all of the prepay that this customer has on account.

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• Select any payment that does not match this inventory item will cause them to be moved to generic prepay, no longer attached to a purchase order.

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At Disbursement Application

• Enter in stock addition, defaulting from purchase order.

• Make voucher actual.

• In ACP > Disbursements > Apply Disbursements from Hold > Select Name id

• Select Payment type of 2 = Prepayments ONLY

• Select prepayment

• Select Voucher to apply to.

Prepay Display Options

AP Inquiry – For Ease of use it is suggested to edit your grid preferences (F12) to enable the display of the prepayment reference.

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Exercise

Exercise One: PO Prepay and Application

1. Setup a new vendor name id.NAM > Name Address > Name Address Maintenance

2. Enter a Purchase order for this new name for 10-tons fertilizer at X-price.

3. View the inventory item Inventory Staus Inquiry to note the "on order" increase.

4. In ACP disbursements, enter a prepay again this order

5. View the inventory item status inquiry. note that there is no change to the balances as prepays do not affect balances UNLESS they are on a PO.

6. View the ACP Balance inquiry for you new vendor id.Note the increase in prepay balance.

7. Receive product against the PO.INV > Stock Additions > Select Name ID > Select Stock Addition.Leave voucher Estimate.

8. Now edit stock addition voucher, change status to Actual.Note that the prepayment button appear.

9. Apply the prepay to the voucher

Exercise Two: PO Prepay request and Payment

1. Setup a new vendor name id.NAM > Name Address > Name Address Maintenance

2. Enter a Purchase order for this new name for 10-tons fertilizer at X-price.

3. View the inventory item Inventory Staus Inquiry to note the "on order" increase.

4. Edit the newly entered PO, going to the back screen to select Prepay Request

5. Request 100% of the purchase order be placed to a prepay request voucher.

6. In ACP Balance Inquiry, look at the balance for unpaid voucher.

7. In ACP disbursements, create a disbursement on the voucher.

8. Now go back to ACP Balance inquiry and look at the balance. Note that the unpaid voucher is moved to the prepayment balance.

9. Now look at the disbursements records. Look at the number of vouchers that were paid by the prepayment check.There will always be two vouchers, positive and negative, for every prepay voucher request.

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