An end-to-end guide to the procurement process in Oracle EBS R12 & Fusion.
The Procure to Pay (P2P or PTP) cycle is a cornerstone business process for any organization. It covers all activities from the moment a need for a good or service is identified, through the purchasing process, to the final payment made to the supplier. A well-managed and streamlined P2P cycle is crucial for controlling costs, ensuring policy compliance, mitigating supply chain risk, and maintaining strong, healthy relationships with vendors. This guide breaks down each step of the process within both Oracle E-Business Suite (EBS) R12 and Oracle Fusion Cloud.
Items to be purchased must be defined, either in Inventory (for stockable items) or as expense items.
Create supplier records, including sites and bank accounts for payments.
Configure approval hierarchies (AME or Position) for Requisitions and Purchase Orders.
Ensure the relevant periods in Purchasing, Payables, and General Ledger are open.
Requester (Employee)
Manager / Approver
Buyer
Buyer / Senior Manager
Warehouse Clerk / Receiving Agent
AP Clerk / Accountant
AP Clerk / System
AP Manager / Payment Manager
Actor: Requester (Employee) | Module: Oracle iProcurement or Purchasing
The cycle begins when an employee identifies a need for goods or services and creates a formal request.
Example: The IT Manager logs into Oracle iProcurement and creates a new requisition for "5 Laptops, Model XYZ", specifying the required delivery date and charging it to the IT Department's cost center.
Navigation Path:
Procurement > Purchase Requisitions > "More Tasks" > Enter Requisition Line
Key Actions:
Fill in the line details and add to cart. Proceed to checkout to enter charge account and delivery details.
Actor: Manager / Approver | Module: Oracle Purchasing / AME
The requisition is routed through a predefined approval hierarchy (e.g., based on position or amount) for validation and budget checking.
Example: The Director of IT receives a notification and, after reviewing the request, approves the requisition for the 5 laptops.
Navigation Path:
Bell icon (Notifications) in the global header, or via BPM Worklist.
Key Actions:
Review the notification details and click "Approve".
Actor: Buyer | Module: Oracle Purchasing
Once approved, the requisition is converted into a formal Purchase Order. This can be done manually by a buyer or automatically.
Example: A buyer in the purchasing department uses the "AutoCreate" function to convert the approved requisition lines into a Purchase Order (PO) and sends it to the approved laptop vendor.
Navigation Path:
Procurement > Purchase Orders > "Process Requisitions" task
Key Actions:
Select the requisition, add to document builder, and create the PO, filling in supplier info.
Actor: Buyer / Senior Manager | Module: Oracle Purchasing / AME
The PO undergoes its own approval process. Once approved, it becomes a legally binding document sent to the supplier.
Example: The purchasing manager approves the PO, making it a legally binding contract. The PO is then electronically dispatched to the laptop vendor.
Navigation Path:
Purchase Order page > "Actions" > Submit
Key Actions:
Submitting the PO routes it through the configured approval workflow.
Actor: Warehouse Clerk / Receiving Agent | Module: Oracle Purchasing / Inventory
The supplier delivers the goods or services. The receiving agent creates a receipt in Oracle to record the delivery against the PO.
Example: The vendor delivers the 5 laptops. The warehouse clerk inspects the shipment, matches it to the PO, and creates a receipt in Oracle for the 5 laptops, which increases inventory.
Navigation Path:
Supply Chain Execution > Receiving > "Receive Expected Shipments" task
Key Actions:
Search for the PO, select the lines, enter the quantity, and click "Create Receipt".
Actor: AP Clerk / Accountant | Module: Oracle Payables
The supplier sends an invoice for the delivered goods. An AP Clerk enters this invoice into the Payables module.
Example: The laptop vendor sends an invoice for the 5 laptops. An AP Clerk enters the invoice into Oracle Payables, matching it against the Purchase Order.
Navigation Path:
Payables > Invoices > "Create Invoice" task
Key Actions:
Enter invoice header details, then use "Match Invoice Lines" to associate with the PO.
Actor: AP Clerk / System | Module: Oracle Payables
The system validates the invoice against the PO and Receipt to ensure quantities and prices are correct. This is known as 2, 3, or 4-way matching.
Example: A 3-way match is performed, validating that the invoice quantity and price match both the PO and the receipt for the 5 laptops. The invoice is successfully validated.
Navigation Path:
Invoice page > "Actions" > Validate
Key Actions:
Validation checks for holds and updates the invoice status. Discrepancies are managed via resolutions.
Actor: AP Manager / Payment Manager | Module: Oracle Payables / Payments
The validated invoice is approved and scheduled for payment. A payment batch is created, and payment is sent to the supplier.
Example: The validated invoice is approved for payment. A Payment Manager includes it in the weekly payment run, and an electronic payment is sent to the vendor.
Navigation Path:
Payables > Payments > "Submit Payment Process Request" task
Key Actions:
Define a template or submit a request to select invoices for payment based on defined criteria.