AP Accrual at Receipt in Oracle R12

 what really happens in Oracle E-Business Suite/Oracle Fusion Procurement & Payables when you set Accrue Expense Items = “At Receipt” (sometimes called Perpetual Accrual). I’ve broken it into the three moments you actually care about—Receipt, Invoice, and Period Close/Reconciliation—plus the key setup switches that drive it.

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1. Key setup you need to double-check

Module	Form / Task	Field / Profile	What it must be	Why it matters
Purchasing	Purchasing Options	Accrue Expense Items	At Receipt (not Period End)	Tells the Receiving Transaction Processor (RTP) to book an accrual the instant you do the receipt.
Receiving	Receiving Options (supplier & org)	Expense AP Accrual Account	A suspense / clearing account	Credited at receipt and debited when the invoice posts.
Payables	Financial Options	Liability Account	Your trade AP control	Credited when the invoice is accounted.
Sub-ledger acct. rules (SLA)	(optional)	Override rules	Only if you need different accounts by item category, cost center, etc.

2. What hits the ledger

a. Physical receipt

(Performed in the Receiving module → accounted by RTP)

Dr	Cr	Comment
Expense charge account (from PO distribution or default rules)	AP Accrual account (Expense Accrual Clearing)	This creates the accrual immediately. No inventory value is involved because the destination type is Expense.

b. Invoice match / approval

(In Payables; occurs when the invoice is validated & accounted)

Dr	Cr	Comment
AP Accrual account	AP Liability account	The accrual is automatically reversed for every matched line. Matching method must be Match to Receipt or Match to PO lines that were received. The balance in AP Accrual now nets to zero if quantities & prices line up.

 Tip: With Accrue-at-Receipt you rarely see Purchase Price Variance (PPV) on expense items because the distribution uses the actual invoiced price; the accrual at receipt used PO price, but SLA re-prices it during invoice accounting.

c. Payment

Dr	Cr
AP Liability	Cash / Bank

3. Period-close housekeeping (the part everyone forgets)

1. Run the Accrual Rebuild & Accrual Reconciliation Report (POXACREC / POXACRPT)

   • Shows every receipt still sitting in AP Accrual.

   • Balance should equal “received but not yet invoiced”.

2. Investigate ageing lines

   • Common causes: partially matched receipts, price differences, canceled PO lines, or ERS/self-billing timing gaps.

3. Write-off or adjust if needed

   • Use the Accrual Write-offs form/program to permanently move old balances to a true expense or variance account—this leaves an audit trail rather than a journal entry directly in GL.

4. Close the Purchasing & Payables periods

   • Enforces that no new unaccounted receipts or invoices sneak in after you reconcile the accrual account.

5. Tie back to GL

   • The ending balance of the AP Accrual account in GL must equal the ending balance of the Accrual Reconciliation Report. If not, re-run the accounting sweep or look for manual journals mistakenly posted to that account.

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4. Common troubleshooting Q&A

Symptom	Likely cause	Quick fix
Accrual never reversed after invoice	Invoice was not matched to the receipt, or matched to PO after RTP had closed period.	Use Match to Receipt; if already paid, do a debit memo to reverse PO price, re-match correctly.
AP Accrual still has small residual balances	Unit price on invoice ≠ PO price, rounding, or partial receipts.	Run Receipt Price Adjustment (for standard cost orgs) or accept small PPV into expense.
Accrual report shows quantities > invoice but GL is zero	Manual JV cleared GL; sub-ledger still open.	Never post manual JVs to the clearing account; use Write-offs so sub-ledger and GL stay in sync.

5. Quick checklist for a clean month-end close

1. All receipts accounted? (Review Receiving Transaction Processor pending)

2. All invoices matched & validated?

3. Accrual Rebuild + Reconciliation run?

4. Outstanding lines explained or written-off?

5. GL balance = Report balance?

6. Periods closed in Purchasing & Payables?

Follow those steps and the AP Accrual account will reliably clear itself without surprise write-offs at audit time. If you need more detailed SLA rule examples or reconciliation SQL, let me know and I can share snippets.e! Here’s a detailed breakdown of what you asked for—SLA accounting rules and SQL queries to help with accrual reconciliation when using Accrue Expense Items at Receipt in Oracle EBS R12 or Oracle Fusion.