If you are upgrading to R12 and you are using Project Costing, you will see a change in the accounting flow for adjustments to supplier invoice expenditure items. To give you some background, an adjustment to a supplier invoice expenditure item happens when you split or transfer an expenditure item that originated in Payables. This adjustment will create two new expenditure items. The first negative expenditure item to the original project and task and the second is a positive expenditure item to the new project and task.
Below is a chart of the different expenditure items that are created and the flags that are set. The “original from Payables” and the “adjusted expenditure items in the original project” will zero each other out.
|Expenditure Item||Adjusting Item Flag||Transferred Flag||Net Zero Flag||Created By|
|Original from Payables||No||No||Yes||Interface from Payables|
|Adjusted Expenditure Item in Original Project||Yes||No||Yes||Split or Transfer Adjustment|
|Transferred Expenditure Item in New Project||No||Yes||No||Split or Transfer Adjustment|
In 11i, you would run the “PRC: Interface Supplier Invoice Adjustment Costs to Payables” to create new AP distribution lines in the supplier invoice. You would then interface these new AP distribution lines (in Payables) to the General Ledger.
In R12, you now need to run the PRC: Distribute Supplier Cost Adjustments to create the accounting for the adjustments and then run the Create Accounting process to generate the journal entries and interface them to GL.