Received Not Vouchered

1. Received Not Vouchered 10/05/2011

2. Agenda • Background • Understanding Write Offs and Misc. Recon. Report • Understanding Sub Ledger Accounting (SLA) and Misc. Recon. Report • Test Results • Resolution • Q & A

3. Background • An Oracle service patch was applied in November 2010 which resulted in loss of database records that were tracking what transactions have been manually written off • Due to the loss of data about what was written off, the standard “write-off” form displayed previous transactions once again as needing to be written off • By the time that the lost data was restored, the AP team had written off transactions with a value of $1,818,350.85 (net) in Sub Ledger which was automatically transferred to the GL as part of normal business operations. This $1.8 million were actually duplicate write offs • A manual correction was made in the GL to account for the duplicates

4. Understanding Write Offs & Misc. Recon Report • Background Note: Write offs and Reversal of Write Offs can take place for the same transaction and can be done many times in the system • Transaction Types • WRITE OFF • REVERSE WRITE OFF

5. Understanding Write Offs & Misc. Recon Report PROGRAM LOGIC TO DISPLAY TRANSACTIONS IN THE REPORT • If no write off takes place, display in the report • If write off takes place one or multiple times, check the most recent transaction in Write Off Tables and if the transaction type is • WRITE OFF – don’t display in the report • REVERSE WRITE OFF – display in the report

6. Understanding SLA and Misc. Recon. Report Sub Ledger Accounting Tables • Any write off or reversal of write offs hits Accrual Accounts, creates SLA Entries and gets reflected in General Ledger. Miscellaneous Reconciliation Report • Transaction Type Write off results in transaction not appearing in the Report. • Transaction Type Reverse Write Off is always linked to the Original Write Off and results in the transaction reappearing in the Report. • The duplicate write offs are not really a reversal of the original write off, hence did not impact the Misc. Recon Report or the Summary Accrual Recon. Report, but it created SLA Entries and Transferred to GL. • The Testing on 27th Sep 2011 one negative transaction by backing out the duplicating write off resulted in transaction re-appearing in Misc. Recon Report because it was linked to Original Write Off.

7. Understanding Write Offs – Misc. Recon. Report All accruals appear in the write off form before they are actioned with either (1) a write off or (2) auto-invoice. For consignment, even transactions that are written off are auto-invoiced since we took possession of the inventory. If write-offs are done without proper investigation and validation, we may create some accounting issues

8. Draft Reconciliation Statement

9. Other issues faced • Pay on Receipts invoices are cancelled • Manually matched to PO receipts • Manual invoices created with Pay on Receipt naming convention creating confusion – but good thing they did not hit any accrual accounts. • Manual lines are added to Pay on Receipt Invoices

10. Open items • AP Team to confirm the final liability figure • Jan 2011 and May 2011 write offs