21.1 Understanding Invoice Processing
A typical Contract Billing invoice process consists of the following steps:
Generating invoices
Printing draft invoices for internal review
Maintaining invoice information
Generating preliminary journal entries
Creating final journal entries
Posting invoices to G/L
Printing customer invoices
After the A/R and G/L entries are created for the invoices, the system moves the workfile transactions that have completed the billing process into the Billing Workfile History table (F4812H).
21.1.1 Generating Invoices
When the system initially creates workfile transactions for the Billing Workfile (F4812), they are undifferentiated, generic transactions. Although they contain the key information needed to create invoices, they are not separated and assigned to a specific invoice number.
The Contract Billing system can create invoices automatically or manually. When Invoice Generation is run from the Invoice Generation menu, the system automatically summarizes the selected workfile transactions from the Billing Workfile (F4812) and stores the summarized records in the Invoice Summary Work File (F4822). The system uses the Invoice Summary entries to create transactions in the Accounts Receivable Ledger (F0311) when Create A/R and G/L Entries is run.
The billing system also allows you to create invoice information manually. You can manually create an invoice batch, create invoices within a batch, and manage the pay items by merging existing workfile transactions or adding ad hoc workfile transactions directly into the invoice.
When you create invoices in the following ways:
Create invoices only for contracts with billing activity. This prevents the system from creating an invoice with all amounts equal to zero
Create invoices regardless of billing activity. The system creates invoices with all amounts equal to zero
Create invoices with all amounts initialized to zero, regardless of billing activity (manual invoices only)
21.1.2 Printing Draft Invoices
Use the Invoice Print program to print internally reviewed invoices. You print draft invoices to allow your project or account manager to verify the accuracy of invoice information prior to mailing the invoice to a customer. The system retrieves draft invoice information from the Billing Workfile (F4812). If there are errors, you can make corrections to the invoice, usually without having to delete the entire batch of invoices.
21.1.3 Maintaining Invoice Information
The billing system allows you to maintain invoice information at four levels, as outlined below:
| Level | Actions |
|---|---|
| Batch Level |
|
| Invoice Level |
|
| Pay Item Level |
|
| Workfile Transaction Level |
|
For example, if you have an invoice batch with 200 invoices, but your project manager notices that an invoice amount is incorrect, then incorrect charges exist for this customer. To correct this situation, you can select an invoice batch from Batch Revisions, select the specific invoice in error, choose the pay item that you need to change, and remove the workfile transactions tat are being disputed for the particular pay item. The invoice will reflect the new amounts and the disputed workfile transactions will stay in the billing workfile for you to correct and invoice at a later date.
21.1.4 Generating Preliminary Journal Entries
The system creates preliminary invoice journals for a selected invoice batch. The system processes workfile transactions against the Account Derivation Table to create detail journal accounting entries in the Detail Journal Workfile (F48910). The system compresses these detail accounting entries into summarized accounting entries in the Summarized Journal Workfile (F48911). The system uses the summarized accounting entries to create the Account Ledger (F0911) transactions for invoice journals when Create A/R and G/L Entries are run.
Note:
Journal Generation is a batch process. The invoice batch is processed as a unit. If one or more errors are detected, the billing system sets the invoice batch to an error status. You must correct the error condition and rerun Journal Generation. You can run Journal Generation as many times as necessary until all errors are corrected.
21.1.5 Creating Final Journal Entries
You run the Create A/R and G/L Entries program (P48199) to create final invoice accounting entries and to transfer your invoice information from the billing system to the Accounts Receivable and General Accounting systems. The billing system updates transactions in the Accounts Receivable Ledger (F0311) and the Account Ledger (F0911) from the Invoice Summary Workfile (F4822) and Summarized Journal Workfile (F48911), respectively.
Create A/R and G/L Entries is a batch program. The system processes the invoice batch as a unit. If the system detects one or more errors, the system does not transfer invoices to the Accounts Receivable or General Accounting systems. The billing system sets the invoice batch to an error status. You must correct the error conditions, then re-run Create A/R and G/L Entries. Your can run Create A/R and G/L Entries as many times as necessary to correct all errors. You can transfer invoice information to the Accounts Receivable and General Accounting systems.
Note:
Create A/R and G/L Entries writes the invoice information to the Accounts Receivable and General Accounting systems. You must run the Post Invoices to G/L program to post the transactions, create automatic offsets, and update the posted codes and batch status.
21.1.6 Posting Invoices to G/L
Select Post Invoices to G/L to post the invoice batch. The system performs the following tasks during the post process:
Selects the data to post
Validates information and processes errors
Creates automatic offsets
Posts transactions
Updates the posted codes and batch status
21.1.7 Printing Final Invoices
Use the Reprint Invoices program to print final invoices. Invoices printed before you run Create A/R and G/L Entries are considered draft invoices. Invoices printed after you run Create A/R and G/L Entries are considered final invoices.
You print final invoices to send to a customer for goods or services rendered. Printing final invoices retrieves invoice information from Billing Workfile History (F4812H).
JD Edwards World recommends that you print final invoices after you complete Create A/R and G/L Entries and post invoices. If you print invoices after processing A/R information, ensures that the information printed on the invoice matches the invoice information created in the Accounts Receivable Ledger.
Note:
If you print final invoices prior to completing the Create A/R and G/L Entries and Post Invoices to G/L processes, you run the risk of inadvertently modifying the invoice information that you printed and mailed to the customer.
21.2 Journal Reclassification
Depending on whether you set the billing constants to allow journal reclassification and how you set the processing options for the Workfile Revisions (P4812) program, you can reclassify, or change, the account information for a workfile transaction.
Journal reclassification is available within the billing system to allow you to move the original cost entry to a different account and let the system automatically create the correcting entries in the Account Ledger (F0911). The correcting entries are created as part of the revenue recognition process.
For example, an employee might charge time to two different work orders during a pay period. When entering time for the pay period, the employee makes and error. After the accounting department processes the payroll transactions, you review the costs and discover the employee's data entry error.
You correct the error by changing the work order numbers in the workfile transactions in the Billing Detail Workfile (F4812). With journal reclassification, when you run Journal Generation (P48132), the system creates the correcting journal entries along with the preliminary journal entries for revenue and costing. When the batch is processed to G/L, the adjusting journal entries are created in the Account Ledger (F0911) to reverse the original account and update the new account.
You can identify the correcting journal entries by their document type (AJ).
In addition to creating adjusting entries in the Account Ledger, if you are correcting a workfile transaction that originated from payroll, the system creates an adjusting entry in Employee Transaction History (F0618) when the revenue batch is created in G/L. The system also uses the same pay type (PDBA code) of the workfile transaction for journal reclassification, such as 101 for regular pay, unless you use the PDBA code override in the billing constants.
21.3 Associated G/L Batch Processing
When you process an invoice batch and need to create G/L journal entries to support revenue, cost reallocation and reclassification journal entries, the system creates and associated G/L batch. This associated G/L batch contains the G/L journal entries associated with the invoice journal entries.
If a contract includes Lump Sum or Unit Price billing lines that are eligible for revenue recognition, and if Workfile Generation creates the revenue transactions in the Billing Workfile (Transaction Classification A and Eligibility Code 2), and if the transactions are not included in revenue processing, then the system includes the transactions in an associated G/L (revenue) batch when the billing lines are invoiced. The G/L batch is created when Invoice Journal Generation (P48131) is run.
If a Fee billing line is eligible for revenue recognition and if the fee is cross-referenced to a billing line that is included in an associated G/L batch, then the system calculates the fee when the associated G/L batch is created.
The associated G/L batch is written to the Account Ledger (F0911) during the Create A/R and G/L Entries process when the invoice journal entries are written to the A/R Ledger (F0311) and Account Ledger. Post the G/L batch from the Revenue Recognition menu (G4823).
Note:
The journal entries in the associated G/L batch are not voided if the invoice is voided.
