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Copyright © 2011, Oracle and/or its affiliates. All rights reserved. Oracle Proprietary and Confidential.2

Disclaimer

Purpose:This document provides an overview of features and enhancements included in Oracle Fusion Applications 11gR1 Release 11.1.1.5.0

and applicable updates. It is intended solely to help you assess the business benefits of upgrading your existing Oracle Products to this release, or implementing completely new Oracle developed products, and planning your I.T. Projects.

Disclaimer:This document in any form, software or printed matter, contains proprietary information that is the exclusive property of Oracle. Your

access to and use of this confidential material is subject to the terms and conditions of your Oracle Software License and Service Agreement or other applicable contract with Oracle, with which you agree to comply. This document and information contained herein may not be disclosed, copied, reproduced or distributed to anyone outside Oracle without Oracle’s prior written consent. This document is not part of your license agreement nor can it be incorporated into any contractual agreement with Oracle or its subsidiaries or affiliates.

This document is intended to outline our general product direction. It is intended for informational purposes only and solely to assist you

in planning for the implementation and upgrade of the product features described. Release information contained in this document is not a firm development plan. Release information published here should not be used as the basis for customer delivery commitments, as part of marketing efforts, or during contract negotiations. This is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions. The development, release, and timing of any features or functionality, and inclusion or not thereof in the commercially available version of the Software, if any, is subject to change at any time and is always at Oracle’s sole discretion. This document is not considered part of the applicable program documentation.

Due to the nature of the product architecture, it may not be possible to safely include all features described in this document without

risking significant destabilization of the code.

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Oracle Fusion PaymentsImplementation and Configuration Considerations

Copyright © 2011, Oracle and/or its affiliates. All rights reserved. Oracle Proprietary and Confidential.

Agenda1. Key Feature: Disbursements

• Prerequisites• Feature Summary• Deltas with EBS• Key Decisions and Best Practices• Relevant Setup Tasks

2. Key Feature: Funds Capture• Prerequisites• Feature Summary• Deltas with EBS• Key Decisions and Best Practices• Relevant Setup Tasks

4


Disbursements

5


Prerequisites

• The concepts covered in the following Fusion Version 1 TOIs are prerequisites for understanding this implementation document:• Manage Payments L3: Prepare and Record Payments• Manage Payments L3: Process Payment Files• Set Up Procurement L3: Define Disbursements and

Configure Payment System Connectivity

6


Feature SummaryKey Terminology

Pool of BuiltPayments

PaymentBuild

Select Documents

Payable

PayablesUser 1

PaymentProcess

Request 1

PaymentBuild

Select Documents

Payable

PayablesUser 2

PaymentProcess

Request 2

PaymentFile

PaymentFile

TransmitPayments

PrintPayments

PaymentFile Creation

Payment Process Profile


Deltas with EBS

• Terminology Change: Payment Instruction changed to Payment File

• New setup entity Payment Code combines three EBS setup entities:• Delivery Channel Code• Bank Instruction Code• Payment Reason Code

8


Key Decisions and Best Practices

• What is your business process?• Decide how much to automate

• What is your organizational structure?• Support for decentralized, centralized, payment factory

models

• What are your processing goals?• Targeted invoice selection or least effort

• What payment methods do you need?• Broad, or granular with validations

9



• What validations do you need?• Payment method or format• User defined or predefined• Document payable, payment, or payment file

• What formats can you use?• Configuring or customizing for your needs

• Security (Encryption and Masking)

10


Key Decisions and Best PracticesWhat is your business process?

• Straight Through Processing• Advantages:

• Fewer touch points means less effort• Exceptions handled outside the payment process, good

payments not held up by the few exceptions

• Tight Manual Control• Advantages:

• Allows manual review and confirmation of payments in process

• Allows step to be initiated manually to fit specific timing needsNote: Any combination of manual and automated steps can be used. It is not necessary to be

completely automated or completely manual. The best practice is to automate everything except manual review of either selected invoices or proposed payments. See following slides for further options and best practices.

11



• The following settings control automation of steps throughout the payment process:

12

Page Options Details

Manage Disbursement System Options

•Validation error handling•PPR Status report submission

Validation error handling setting defaults to payment process request (PPR) templates or directly to Submit PPRs page if no template is used

Create Payment Process Profile

•Printing•Transmission•Reporting

Set for automatic initiation or manual initiation. Reporting includes payment file register, positive pay, and separate remittance advice

Submit Payment Process Request

•Validation error handling

Choose to automatically remove any documents or payments with errors and progress valid items, or stop the process and review errors



• Optional stopping points for review during the payment process:

13

Page Options Details

Manage Disbursement System Options

•Review proposed payments

Setting defaults to payment process request (PPR) templates or directly to Submit PPRs page if no template is used

Submit Payment Process Request

•Review selected installments•Review proposed payments

Best practice: While you can stop at both points, it is recommended to stop for review at most once. The stopping points offer different values, so pick the one that suits your needs best



• Best practices for process submission

14

Object Best Practice

Payment Process Requests

Create one template for each unique combination of submission attributes. Ensure your templates cover all normal cases – avoid off-cycle payments and the associated costs.

Do not enable Create Payment Files Immediately, as this will limit payment file creation to within a single PPR.

Create a scheduled process for each template to create PPRs automatically. This should be run frequently enough to meet due dates, as well as to take advantage of early payment discounts.



• Best practices for process submission

15

Object Best Practice

Payment Files Create one or more scheduled processes that will run after all PPR processes complete. The payment file will pick up any waiting payments with the proper attributes, regardless of which PPR they originated in, allowing for the fewest number of payment files possible.

Fewer payment files result in lower transaction processing costs.


Key Decisions and Best PracticesWhat is your organizational structure?

16

Invoice Selection

Payment Processing

Invoice Entry BU A

BU B

BU A

BU B

BU A

BU B

Decentralized

Centralized Invoice Selection

Centralized Invoice Entry

BU A

BU B

Centralized

BU A & B

Centralized Payment Processing

BU A & B

BU A & B

Payment FactoryInvoice Entry

Invoice Selection BU A

BU B

Centralized Payment Processing BU A

BU B

BU A & B

BU A & B


Key Decisions and Best Practices What is your organizational structure?

• Decentralized Processing• Enable each BU to create its own payment process• Enable each BU to decide who and when to pay

• Centralized Processing• Reduce manpower costs by centralizing payment process decisions

and exception handling• Reduce payment processing costs by pooling payments together into

fewer payment files• Efficiencies of scale allow some users to specialize in payment

processing

• Payment Factory• Enable each BU to decide who and when to pay• Reduce payment processing costs by pooling payments together into

fewer payment files

17


Key Decisions and Best Practices What are your processing goals?

• Select invoices to be paid with a broad selection criteria, thus creating as few payment process requests as possible• Recommended for a Centralized Processing model• Payment process templates can be more generic, and fewer

of them• Best practice for supporting broad selection is to ensure that

only one payment process profile (PPP) is active per unique set of transactional attributes (business unit, payment method, disbursement bank account, and currency)• System can derive PPP automatically per payment,

instead of forcing all payments in a payment process request to have the same PPP

18


Key Decisions and Best Practices What are your processing goals?

• Select invoices to be paid with targeted selection criteria, thus allowing precise control over time• Recommended for Decentralized or Payment Factory models• Allows different types of payments to be managed in separate

processes, for example expense reports Monday, domestic supplier payments Tuesday, and so on

• Best practice to support targeted selection is to create specific payment process templates for each type, using pay groups, payment priorities, or other targeted selection criteria

19


Key Decisions and Best PracticesWhat payment methods do you need?

• Choose broad payment methods like the seeded Check and Electronic, or choose to create your own more granular payment methods, optionally with targeted validations• Use laser printed checks rather than numbered checks when

possible.

• For a detailed discussion of the costs and benefits of more granular payment methods, see topic ‘Payment Methods: Explained’ in the ‘Define Disbursements’ chapter of the Implementation Guide

20


Key Decisions and Best PracticesWhat formats can you use?

• Favor standards-based formats that can be used with multiple banks• EDIFACT formats (PAYMUL, MT100, MT103, etc)• NACHA formats (Generic, CCD, PPD, etc)

• Find out what your processing bank supports• Modify seeded formats using BI Publisher

• An XML extract provides Payments data• Use RTF templates to create or modify human-readable layouts, for

checks and reports• Use ETEXT files to create fixed-position layouts, for transmission and

automated payment processing• For a more detailed discussion of tailoring formats to your needs, see

the white paper ‘Format Customization In Oracle Payments’ at support.oracle.com

21


Key Decisions and Best PracticesWhat validations do you need?

• You can use prepackaged validations designed to match specific formats

• You can create your own validations for almost all transaction attributes• Layer them on top of prepackaged validations when formats

or regulations change• Or use them to create entirely new validations for your own

formats

22


Key Decisions and Best Practices What validations do you need?

• Validations can be associated with payment methods or formats

• Validations can be performed at the following levels:• Document payable• Payment• Payment File

• Documents payable are validated during invoice entry if the validation is associated with a payment method…• Immediate feedback

• Fastest way to resolve errors and make payments• Requires knowledgeable invoice entry personnel and a larger

number of payment methods with different validations associated

23


Key Decisions and Best Practices What validations do you need?

• … Or after payment process request submission if the validation is associated with a format• Allows a specialized payment process manager to queue up

and resolve errors• Allows fewer payment methods and requires less knowledge

for invoice entry personnel

• For a detailed discussion of the costs and benefits of validations, see topic ‘Validations: Critical Choices’ in the ‘Configure Payment System Connectivity’ chapter of the Implementation Guide

24


Key Decisions and Best PracticesSecurity

• Use the Positive Pay File to reduce fraud• Encrypt and mask supplier bank account numbers

before importing or entering any data in the system• Use Oracle Wallet Manager to create a wallet• Store wallet in a very secure, limited access file

system location• Obtain encryption keys externally, or have Payments

generate them• Rotate encryption keys periodically• See System Security Options: Critical Choices in the

Implementation Guide

25


Relevant Setup Tasks

• Payment Methods• Payment Process Profiles• Validations• Formats• Transmission Configurations• System Security Options

26


Funds Capture

27


Prerequisites

• The concepts covered in the following Fusion Version 1 TOIs are prerequisites for understanding this implementation document:• Process Customer Payments L3: Manage Funds Capture• Set Up Order Fulfillment L3: Define Funds Capture and

Configure Payment System Connectivity

28


Receivables

Receipt

Creation

ReceivablesUser

PaymentSystem

AuthorizationInternalPayeeRouting

Remittance

ReceivablesUser

PaymentSystem

SettlementSettlementBatch Creation

PaymentSystem

Settlement BatchAcknowledgment

Funds Capture Process Profile

Feature SummaryKey Terminology


Deltas with EBS

• Improved Transaction Exception handling, through Accounts Receivable

30



• What Payment Methods to Accept• What Payment Systems to Use• What Formats to Use• What Transmission Protocols to Use• Security Setup: Encryption and Masking• Tying It All Together: Internal Payee

31


Key Decisions and Best PracticesWhat payment methods to accept

• Credit Cards• Implement additional features to reduce processing fees

• Company card support• Address verification• Card verification code

• Bank Account Transfers• Payer-initiated payment methods (such as checks

and cash) are recorded directly in Oracle Fusion Receivables

32


Key Decisions and Best PracticesWhat payment systems to use

• Leverage existing banking or processing relationship• Your bank may process transactions, or have a partnership

with a processor

• Leverage processors with existing integrations with Oracle Payments EBS• Chase Paymentech (Certification Pending)• First Data Global Gateway (formerly Concord EFSnet)

(Certification Pending)• PayPal PayFlow Pro (Certification Pending)• Other existing integrations have been built by gateways or

consulting firms

33


Key Decisions and Best PracticesWhat formats to use

• Find out what your processing partner supports• For a detailed discussion of tailoring formats to your

needs, see the white paper ‘Format Customization for In Oracle Payments’ at support.oracle.com

34


Key Decisions and Best PracticesWhat formats can you use?

• Modify seeded formats using BI Publisher• An XML extract provides Payments data• Use RTF templates to create or modify human-readable

layouts, for checks and reports• Use ETEXT files to create fixed-position layouts, for

transmission and automated payment processing• For a more detailed discussion of tailoring formats to your

needs, see the white paper ‘Format Customization In Oracle Payments’ at support.oracle.com

35


Key Decisions and Best PracticesWhat transmission protocols to use

• Find out what your processing bank supports• Favor transmission protocols seeded in Oracle Fusion

Payments• Use Funds Capture Process Profile for greater

configurability in transmission and formatting• Avoid name-value pair approach

36


Intranet

DMZ Secure Zone

DMZ Public Zone

Deployment ArchitectureExternal Connectivity

37

End Users

HTTP Load

Balancing

Application Tier

Payment System

Payments

Transmission Servlet

Database Tier

Router over Leased Line

Internet

OR



• Comply with PA-DSS Security Standards• Hard requirement for accepting credit card payments• Minimize risk of exposing sensitive customer data• Work with an PA-DSS auditor to ensure compliance and

avoid potential violations

• Encrypt and mask customer credit card and bank account numbers before importing or entering data into the system

38



• Use Oracle Wallet Manager to create a wallet• Store wallet in a very secure, limited access file

system location• Obtain encryption keys externally, or have Payments

generate them• Rotate encryption keys periodically• See System Security Options: Critical Choices in the

Implementation Guide

39


Key Decisions and Best PracticesSecurity Gotchas

• Bank account numbers are not encrypted immediately upon entry• Configure the Encrypt Bank Account Data program to run

frequently

• Credit Card Numbers that are entered through PLSQL (via migration or import) are not encrypted immediately• Run the Encrypt Credit Card Data program after imports

40


Key Decisions and Best PracticesTying It All Together: Internal Payee

• Transactions are identified by Business Unit, but are processed by Internal Payee• If all Business Units require identical processing, create one

internal payee to serve them all• If Business Units require different processing, create one

internal payee per business unit• In a mixed model, use Routing Rules to determine how to

process each transaction

41


Relevant Setup Tasks

• Payment Methods• Funds Capture Process Profiles• Internal Payees• Formats• Transmission Configurations• System Security Options

42

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Oracle Fusion PaymentsImplementation and Configuration Considerations

Download - Oracle apps fusion Payment

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