BP080 Accounts Payables V1 0

EAPM BP080 TO-BE PROCESS RAILTEL CORPORATION OF INDIA LIMITED

ACCOUNTS PAYABLES

Author:

Amit Modi / Rana Nishant K Singh

Creation Date:

14-Jan-2013

Last Updated:

11-Mar-2013

Document Ref:

RCIL-BP080-AP

Version:

Version 1.0

Disclaimer: This document is a confidential document between Wipro Ltd. and RailTel Corporation Of India Limited. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, whether electronic, mechanical, photocopying, recording or otherwise, without the written permission of Wipro / RCIL. This document includes confidential information related to Wipro and RCIL and shall not be distributed to any persons other than those mentioned in the distribution list herein. All product names referenced herein are trademarks of their respective companies

ii

Document Control

Change Record 3

Date

Author

Version

Change Reference

14-January-2013

Amit Modi / Rana Nishant Singh Amit Modi / Rana Nishant Singh

0.1

Base Document

1.0

Final Version

11-March-2013

Reviewers Name

Position

Prithwish Chatterjee Swarup Ghosal Chaudhury

Wipro Project Manager Wipro Program Manager

Approver Name

Position

Sh. Rahul Aggrawal

AGM – Finance

Sh. Anuj Kumar

Manager – Finance

Sh. Kumar Bachchan

Sr. Manager – DNM

Sh. A K Sablania

GGM - DNM

Sh. S R Kapoor

Additional GM – Finance

Signature

Distribution Copy No.

Name

Location

1 2 3 4 5

RailTel Project Parivartan Steering Committee RailTel Project Parivartan Core Working Group RailTel Project Parivartan Regional CWG Wipro Onsite Team Wipro Technical Team

Gurgaon Gurgaon New Delhi/Mumbai/Secunderabad/Kolkata Delhi/Mumbai/Secunderabad/Kolkata Gurgaon Gurgaon

Note to Holders: If you receive an electronic copy of this document and print it out, please write your name on the equivalent of the cover page, for document control purposes. If you receive a hard copy of this document, please write your name on the front cover, for document control purposes. The copy numbers referenced above should be writ ten into the Copy Number space on the cover of each distributed copy. If the document is not controlled, you can delete this table, the Note To Holders, and the Copy Number label from the cover page.

iii

Contents

Document Control .....................................................................................................................ii Introduction ............................................................................................................................... 1 About this Document .......................................................................................................... 1 How this document is organized ........................................................................................ 2 Generic Assumptions .......................................................................................................... 3 Payables Business Process ......................................................................................................... 4 AP 01 AP 02 AP 03 AP 04 AP 05 AP 06 AP 07 AP 08 AP 09 AP 10 AP 11

Supplier Creation .................................................................................................. 5 Invoice Creation .................................................................................................... 7 Recurring Invoices ................................................................................................. 9 Advance Payment ............................................................................................... 11 Payment Process ................................................................................................. 13 Creation Debit / Credit Memo ............................................................................ 15 Tax Definition ...................................................................................................... 17 Tax Deduction at Source (TDS) ............................................................................ 18 Work Contract Tax (WCT) ................................................................................... 20 Service Tax .......................................................................................................... 22 Period Close Process ........................................................................................... 24

Open and Closed Issues for this Deliverable ............................................................................ 26 Open Issues ....................................................................................................................... 26 Closed Issues ..................................................................................................................... 26

2

How this document is organized This document forms deliverable of the operation analysis phase of the ERP implementation project for RAILTEL. The purpose of this document is to compile a comprehensive list of requirements against which to map Application features. The scenarios listed in the subsequent sections are reusable templates and are created once for each business process. Each of the following sections consists of the following sub sections:

Assumptions Any assumptions that are specific to the process being detailed are recorded in this sub section.

Process Scenario The Event initiates the corresponding process.

Process Solution: 1.

Complete process flow

2.

Process Id #: process.

Unique number for the sub-processes within the main

Description 1.

Process Title & Description: The bold letters gives the process title followed by the detailed description of the process in normal font.

2.

Key Requirements from the above process

Requirement Fulfilment using ERP Approach 1.

Solution Type & Description: Used to designate type of solution. The types mentioned here are Screen, Manual and System. The Screen refers to the type where the data is to be entered in the screen or can be viewed in the screen. Manual type is the manual way of doing the process whether the user would be performing the process in the system or otherwise. The System type of solution is referred to when the system performs the step through automation or sub-automation. The following keys can be used for the process in the system. i.S – Standard ii.W - Workaround iii.C – Extension/Customization

2.

Navigation Path: The path to navigate to the relevant functionality in Applications. The following acronyms have been used for navigation type: i.(T) – Tab ii.(B) – Button iii.(CB) – Check Box iv.(F) – Field

3.

Impact analysis Process Improvements Quality & Customer Service Leading Practices

Note: The texts in grey shade are optional activities.

CompanyConfidential - For internal use only

3

Generic Assumptions Any additional information captured in ERP through external systems will be highly dependent on the external systems. Wipro will not be responsible for the functioning or the implementation of the external systems. Customizations identified in the requirement definition document will be developed subject to the scope defined in the approved project charter.


4

Payables Business Process

Enter / Maintain supplier

Receive Invoice from Supplier & Enter.Invoice(in case PO/LOA Invoices will be created automatically)

Validate invoice

Pay invoice

A/P 100,000

60,000 10,000 30,000

Transfer information to general ledger

Create accounting entries


5

AP 01

Supplier Creation

AP01 Supplier Creation

ERP

Manual

Email

Start

Projects & Procurement (Initiator) PO-02- Purchase Requisition Process

Yes

s t n e m t r a p e D r e h t O

Any Department (Initiator) PO-01- Online Purchase Requisition Process

Supplier Is Available or not ?

No Supplier Creation Form will be Prepared & sent to Finance department.

t n e m t r a p e D e c n a n i F

Yes

Verification of Supplier Creation form. Clarification Required ?

No

Supplier is Created by entering necessary information like address , bank details PAN,TAN etc..


Email sent of Supplier Creation Sent to requestor

End

6

RAILTEL Process: Supplier Definition Control Number: AP01

Description:This

Business Function: RAILTEL -Accounts Payable

Date:14-Jan-2013

Mapping Team: Wipro

Process Owner: RAILTELFinance team

process explains the process of defining the supplier in AP module

Process Number: AP01 Event

Description: This process is triggered whenever a new supplier has to be created in the system Source: RAILTELFinance Team

AS IS Process

AS IS Process ID #

Process ID #

None None None

N/A N/A N/A

AP01.01 AP01.02 AP01.03

None

N/A

AP01.04

Description

Mode

Supplier Creation Form will be received from Any Department based on their requirement. Form is verified and if required clarification is taken from respective department. Create Supplier record in the system with appropriate classification, site information of address, contact details. Enter necessary Liability/Prepayment account of the supplier/Employee.Bank account number can be made as a mandatory field by a customization. Enter the Supplier additional information like PAN Number, Vendor Type Etc. Confirmation sent of supplier Creation sent to requestor.

System


System InternalSystem

InternalSystem

Requiremen t Fulfilment using ERP Approach(Y /N) Y Y Y

Y

7

AP 02

Invoice Creation

AP02 – Invoice Creation

ERP

Manual

Email

START

s t n e m t r a p e D r e h t O

Any Department (Initiator) Respective department will sent additional data or clarification on mail to finance dept.

PO / RFQ / Reimbursement claim


Any Department (Initiator) PO-01- Online Purchase Requisition Process IE04- Expense Claim Reimbursement


Based on Approval as per SOP Standalone Invoice will be created

No

Yes

The invoice is matched to PO/GRN depending on the level of matching

Clarification communication is sent to respective Department.

The distribution charge account and Tax codes(TDS , WCT etc) will be entered./ Necessary Correction will be done.

No

Default Charge Accounts are verified and Tax codes (TDS, WCT etc..) are entered.

END

Complete Invoice is Verified & Sent for Validation

Accounting Process and Transfer to GL can be run for invoices separately or can be run along with the period closing process . AP11 – Period Close Process


Invoice is verified & Validated & Accounted

Yes

Validation will create two separate invoices. Please Refer AP08 Tax Deduction at Source (TDS)

8

RAILTELProcess: Invoice Creation Control Number: AP02

Date:14-Jan-2013 Process Owner: RAILTELFinance Team

Description: This process covers the creation of Standard invoice for Non Po related items like all expenses related payments. Description: This process is triggered when supplier submits invoices which are PO or Non PO Based. Source: RAILTELFinance Team


AS IS Process

Business Function: RAILTEL -Accounts Payable Mapping Team: Wipro

AS IS Process ID #

Process ID #

FIN_AP_INVOICING

1 – 3

AP02.01

FIN_AP_INVOICING FIN_AP_INVOICING

1 – 3 1 – 3

AP02.02 AP02.03

FIN_AP_INVOICING

1 – 3

AP02.04

FIN_AP_INVOICING

1 – 3

AP02.05

FIN_AP_INVOICING None

1-3 NA

AP02.06 AP02.07

Requirement Fulfilment using ERP Approach(Y/ N)

Description

Mode

Receive the original invoice from any Department (Non PO Based expense ) or from Procurement Department (along with the PO ) or Other Departments (along with Reimbursement Bills) Check whether it PO/RFQ/Employee Claim If Yes Match invoice with PO/bills , verify Default charge accounts & enter Tax (TDS, WCT etc.,) st details and sent for validation i.e. 1 level approver If No Create Standalone invoice Enter charge accounts & Tax (TDS, WCT etc.,) details and sent st for validation i.e. 1 level approver nd Invoice is validated and sent for accounting i.e. 2 level of approving and if not validated then Clarification communication is sent to respective Department. Invoice is Accounted and if not then will be revalidated. Transfer the journal entries to General Ledger

System

Y

System

System

Y Y

System

Y

System

Y

System System

Y Y


9

AP 03

Recurring Invoices

AP03 Recurring Invoices


Start

ERP

Define Recurring Template

Define Special Calendar

Define Invoice details like Supplier name , periods etc.


Manual

Create the Invoices for various periods

Email

Please Refer AP02.04 Invoice Creation Process

10

RAILTEL Process: Recurring Invoices Control Number: AP03



Date:14-Jan-2013

Mapping Team: Wipro

Process Owner: RAILTEL Finance Team

Description: This process covers the process flow for creation of Recurring InvoicesE.g. Rent, electricity payment. Description: This process is triggered for creating Recurring Invoices Source: RAILTELFinance Team

AS IS Process

AS IS Process ID #

Process ID #

None None

NA NA

AP03.01 AP03.02

None None

NA NA

AP03.03 AP03.04

Description

Mode

Enter Monthly recurring invoice template of recurring payments. Enter details like supplier name, supplier site, payment method, recurrence rule, amount per recurring period and other details. Invoices are created periodically as per the requirement. Follow Invoice Creation Process AP02.04

System


System System System

Requirement Fulfilment using ERP Approach(Y/N) Y Y Y Y

11

AP 04

Advance Payment

AP04 Advance Payment t n e m t r a p e D r e h t O


ERP

Manual

Any Department (Initiator) PO-01- Online Purchase Requisition Process IE04- Expense Claim Reimbursement


Request for Advance payment is received from Other Department

Email

Advance Payment details are recorded as a Prepayment Invoice. Tax information (TDS,WCT etc.) are entered with other details

The invoice is validated & Accounted

The Advance payment is paid to the Supplier’s Account

Start The paid Prepayment Invoice is adjusted with the forthcoming invoices

End

Accounting Process and Transfer to GL can be run for invoices separately or can be run along with the period closing process . AP11 – Period Close Process


12

RAILTEL Process: Advance Payment Control Number: AP04

Process Number: AP04

Date:14-Jan-2013

Mapping Team: Wipro


Description: This

process covers the process flow for creation of prepayments, which are treated as advance payment to Suppliers/ employees. Description: This process is triggered when an authorization received from Purchase department/HR/Line managers to Make advance payment to the suppliers. Source: RAILTELFinance Team

Event

AS IS PROCESS

Business Function: RAILTEL-Accounts Payable

AS IS Process ID #

Process ID #

FIN_AP_INVOICING

5

AP04.01

FIN_AP_INVOICING

5

AP04.02

FIN_AP_INVOICING FIN_AP_INVOICING FIN_AP_INVOICING FIN_AP_INVOICING

5 5 5 5

AP04.03 AP04.04 AP04.05 AP04.06

Requirement Fulfilment using ERP Approach(Y/N)

Description

Mode

Finance department receive a copy of Approved purchase orders with office memo requesting finance to make the advance payment from other departments. Create Prepayment invoice. Enter details like supplier, supplier site, Purchase Order Number, pre-payment invoice number, invoice date, amount, distribution etc. Approve &Validate the Advance Invoice The Advance is paid to the Supplier’s Account The Invoice is adjusted against the Advance Invoice. Accounting Process and Transfer to GL can be run for invoices separately or can be run along

Manual

Y

System

Y

System

Y Y Y Y

with the period closing process. AP12 – Period Close Process.



13

AP 05

Payment Process

AP 05 – Payment Process

All Typ e of In voice s wer e ide ntified for Pa ymen t. Credit Memo against respective are Selected & adjusted in Payment

Start


ERP

Yes

The details required for the payment processing is provided

Email

The invoices to be paid are chosen manually or by the batch payment logic

Once the details are provided the payment is processed and confirmed

Print the cheque/ DD and send it to the supplier Payment advice needs to be sent for the successful payments

Is the payment done by cheque?

No

The Payments are done either individually or in batches

Manual

In case of TDS Payments, the payment deposit date, challan number and branch of deposit details should be captured once the payment is done.

All Ac coun ting a re cr eate d & transferred to General ledger GL06 – Sub Ledger Enteries

A flat file havin g pa ymen t information will be uploaded to bank Site End


14

RAILTEL Process: Payment Process Control Number: AP05


Date:14-Jan-2013

Mapping Team: Wipro



Description: This process covers the process flow for Bank Debit and Check payment process Description: This process is triggered for making payments to suppliers/Employees Source: RAILTELFinance Team

AS IS PROCESS

AS IS Process ID#

Process ID #

FIN_AP_PAYMENT PROCESSING

1 -2

AP05.01

FIN_AP_PAYMENT PROCESSING FIN_AP_PAYMENT PROCESSING FIN_AP_PAYMENT PROCESSING

1 -2 1 -2 1 -2

AP05.02 AP05.03 AP05.04

FIN_AP_PAYMENT PROCESSING FIN_AP_PAYMENT PROCESSING

1 -2 1 -2

AP05.05 AP05.06


1 -2

AP05.07

None

N/A

AP05.08

Description

Mode


Payments are done through cheques/ Demand Drafts or through electronic payments Payments are done either individually or in batches Selection of invoices for payment Scheduled batch for payment through online bank service to suppliers as per the payment term Confirm payment batch. If the payment is done by Cheque, the Cheque is printed and issued to the supplier. In case of online payments, the payment information is uploaded in the bank website and approved in the bank website as per Schedule of Power. A Payment advice needs to be sent to the payments successfully processed. In case of TDS Payments, the challan number, deposit date and branch information needs to be captured in the payment additional information once the payment is done. All Accounting is created & Transferred to general ledger.

System

Y

System

Y Y Y


System System System System

Y Y

System

Y

System

Y

15

AP 06

Creation Debit / Credit Memo ERP

Manual

Email

AP06 Creation Debit / Credit Memo

t n e m t r a p e D t n e m e r u c o r P

Receive the material from the supplier

Stored in “Damages” -Sub Inventory

Yes

Return to the vendor and Reverse the Cenvat credit

No

Issued to the respective Location.

Material Found Faulty

Material returned to Inventory

Yes

Start

No For Liquated Damages Work Confirmation of Service.


C O N

Physical damage found?

As per Agreement or not?

No Material continue to exist in the respective locaiton

Invoice Matched with PO (material accepted)

Yes

Purchase Order Will be Updated Accordingly for generating Debit memo / Credit Mem

Debit Memo will be created and will be adjusted against Original Invoice During Payment. Please Refer AP05 Payment Process

Please Refer AP02 – Invoice creation Process

SR will be raised when Service is Down

When service is restored SR will be closed

All Necessary Information will sent to Finance for charging Penalty to Supplier


End

16

RAILTEL Process: Debit Memo Control Number: AP06


Date:14-Jan-2013

Mapping Team: Wipro

Process Owner: RAILTEL.

Description: This process covers the process of Debit memo transactions Description: Debit Memos which will actually reduces supplier balances this is for returns and to cover additional charge on Invoices. Source: RAILTELFinance Team


AS IS Process

AS IS Process ID#

Process ID #

None None None None

N/A N/A N/A N/A

AP06.01 AP06.02 AP06.03 AP06.04

Description

Mode

Return material to supplier using a Return To Vendor Transaction. Debit Memo is raised against the supplier. Reverse the Cenvat credit obtained. Adjust the Debit memo with the payments.

System




Y Y Y Y

17

AP 07

Tax Definition

RAILTEL Process: Tax Definition Control Number: AP07



Date:14-Jan-2013

Mapping Team: Wipro


Description: This process covers the process of Taxes Definition Description: This process is triggered when the Taxes are to be defined. Source: RAILTELFinance Team

AS IS Process

AS IS Process ID#

Process ID #

None None None

N/A N/A N/A

AP07.01 AP07.02 AP07.03

None None

N/A N/A

AP07.04 AP07.05

Description

Mode

Define the Vendor Types, TDS Section types, TDS Section codes used for deductions Define the Tax codes. TDS Exemption needs to be captured as separate tax codes with separate Threshold setups. Define the TDS Thresholds. Define Tax categories


System System System System System

Requirement Fulfilment using ERP Approach(Y/N) Y Y Y Y Y

18

AP 08

Tax Deduction at Source (TDS) ERP

AP08 Tax Deduction at Source (TDS)

Manual

Email

Start

PO Invoice

Invoice information will be entered.& Verified. TDS rate will be captured

e c n a n i F

Non PO Invoice

Credit Memo against Original Invoice/Supplier will be Created.

During Payment Credit Memo will be adjusted against Original Invoice. Please refer AP05 Payment Process

1

After Validat ion of O riginal Invoice in AP02 Invoice Creation two Separate Invoices will be Generated.

Account ing wil l be do ne and a ll jour nals wi ll be transferred to GL during Period Close Process. Please refer AP11 Period Close Process

2 Standard Invoice against TDS Author ity will be Create d

Invoice will be Validated and will be ready for payment

Payment will be done as per scheduled date. Please refer AP05 Payment Process

End


19

RAILTEL Process: Tax Deduction at Source (TDS) Control Number: AP08


AS IS Process


Date:14-Jan-2013

Mapping Team: Wipro


Description: This process covers the creation of Standard invoice with TDS Description:creation of Standard invoice with TDS Source: RAILTELFinance Team. AS IS Process ID #

Process ID #


5 5 4

FIN_AP_INVOICING

5


Requirement Fulfilment using ERP Approach(Y/N )

Description

Mode

AP08.01 AP08.02 AP08.03

Based on the nature of Payment & vendor type TDS tax rate is defined. The TDS attached to the invoice. TDS is deducted on every invoice that is paid. The TDS deducted is paid to the Income Tax Authority on a monthly basis.

System System

Y Y Y

AP08.04

TDS Certificates are processed and issued.

System

Y


Manual

20

AP 09

Work Contract Tax (WCT) ERP

AP09 Work Contracts Tax (WCT)

Manual

Email

Start

PO Invoice

Invoice information will be entered.& Verified. WCT will be captured e c n a n i

F

Non PO Invoice

Credit Memo against Original Invoice/Supplier will be Created.

After Validation of Original Invoice in AP02 Invoice Creation two Separate Invoices will be Generated.

Standard Invoice against WCT Authority will be Created

During Payment Credit Memo will be adjusted against Original Invoice. Please refer AP05 Payment Process

Accounting will be done and all journals will be transferred to GL during Period Close Process. Please refer AP11 Period Close Process

Invoice will be Validated and will be ready for payment

Payment will be done as per scheduled date. Please refer AP05 Payment Process

End


21

RAILTEL Process: Work Contract Tax (WCT) Control Number: AP09


AS IS Process



Date:14-Jan-2013

Mapping Team: Wipro


Description: This process covers the Generation of Work Contract Tax Description: This process is triggered when the Work Contract Tax is recorded in the system Source: RAILTELFinance Team AS IS Process ID#

Process ID #

5 5

AP09.01 AP09.02


Description

Mode

System System

Y Y

System

Y

System

Y


4

AP09.03

Based on the state of registration the WCT tax rate is defined The WCT tax attached to the invoice. WCT Tax is deducted on every invoice that is paid. The WCT Tax deducted is paid to the state government on a monthly basis.

FIN_AP_INVOICING

5

AP09.04

WCT Certificates are processed and issued.


22

AP 10

Service Tax

AP10 Service Tax

t n e m e r u c o r P

PO will be Created. Service tax information will be as per the Item.

Material Received from Supplier

PO Invoice

) s e l b e a y c a n P a t s n n i u F c o c A (

Start

PO Invoice or Non PO Invoice ?

Non PO

Invoice Created / Matched with PO Please Refer AP02 Invoice Creation

Payment from Supplier refer AP05 Payment Process

End

) r e

e g c d e L n l a a r n e i n F e

Service Tax Recovery Will be Debited

G (


Service Tax Interim Recovery Will be Debited

23

RailTel Process: Service Tax Control Number: AP10


AS IS Process


Business Function: RAILTEL -Accounts Payable Mapping Team: Wipro

Date:14-Jan-2013 Process Owner: RAILTEL.

Description: This process covers the Generation & Settlement of Service Tax Description: This process is triggered when the Work Contract Tax is recorded in the system Source: RAILTEL Finance Team AS IS Process ID #

Process ID #

5 5

AP10.01 AP10.02


4

AP10.03

FIN_AP_INVOICING

5

AP10.03

Requirement Fulfilment using ERP Approach(Y/ N)

Description

Mode

Service tax rate will be defined System as per Current Tax Rate by Law. The Service tax attached to the PO invoice / Non PO Invoice. Service Tax is captured at PO / Invoice Level. CENVAT information is capture at this level as per new guidelines. The Service Tax deducted is paid to the state government.

System System

Y Y

System

Y

After Settlement Process If CENVAT is available it is claimed and if payable then Invoice will be created in the system for the same and will be paid.

System

Y


24

AP 11

Period Close Process

AP11 Pe riod Close Process

ERP

Start

No

Finance Department to initiate the closing process


Invoices and payment entries complete?

Close the Payables Accoun ting Period

Manual

Email

Complete the details (Validate & Accoun t)

AP Data is Transfered to GL

Yes

Preparation of Monthly reports

End


25

RAILTEL Process: Period Close Process Control Number: AP11


Date:14-Jan-2013

Mapping Team: Wipro

Process Owner: RAILTEL

Process Number: AP11

Description: This

process covers month end process of Accounts Payables.

Event

Description: This process is triggered to make month end process. Source: RAILTEL Finance Team.

AS IS Process

AS IS Process ID#

Process ID #

Description

Mode


None

N/A

AP11.01

Check & verify the completeness of all Transaction(Invoice & Payment)

System

Y

None None

N/A N/A

AP11.02 AP11.03

System

Y Y

None None

N/A N/A

AP11.04 AP11.05

After Verified Completeness, Correction will be Validated & accounted All the transactions i.e. invoice and payments are transferred to Main Ledger(General ledger). Preparation of Reports from Payables Close the period.



Y Y

26

Open and Closed Issues for this Deliverable Open Issues

ID

Issue

Resolution

Responsibility

Target Date

Impact Date

Resolution

Responsibility

Target Date

Impact Date

Closed Issues

ID

Issue


BP080 Accounts Payables V1 0

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