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Understanding the Basics of EDI

EDI 997

Functional Acknowledgement

Understanding the Basics of EDI

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What is EDI 997?

Based on the Accredited Standards Committee (ASC) X12 format, the EDI 997 provides a response that informs the sender if the content of the transmission was syntactically correct. In addition, it can provide increasing levels of detail that are controlled by the trading partners. In this form, the EDI 997 is equivalent to a receipt, providing information that an exchange of goods for currency has taken place.

EDI 997 (Functional Acknowledgement)

An EDI 997 Functional Acknowledgment Transactional Set is communicated between parties when there has been a transmission within the EDI environment. It merely confirms the receipt of an EDI transactional set. When two parties, like a buyer and supplier, exchange an EDI transmission followed by confirmation, they are referred to as “trading partners.” For example, a typical scenario is a seller sends an EDI 810 Invoice Transactional set. The purchaser confirms receipt of the EDI 810 by sending an EDI 997 Functional Acknowledgment. It is important to note that receiving an EDI 997 from a remote party does not mean they agree nor disagree with the contents of the EDI transmission. It merely says they have received it and are sending a confirmation of receipt.

What Is an EDI 997 Functional Acknowledgement?

The EDI 997 contains the format and establishes the data contents of the Functional Acknowledgement Transaction Set for use within the context of an EDI environment. The transaction set can be used to define the control structures for a set of acknowledgments to indicate the results of the syntactical analysis of the electronically encoded documents, like an EDI 810 Invoice. The encoded documents are the transaction sets, which are grouped in functional groups, used in defining transactions for business data interchange. This standard does not cover the semantic meaning of the information encoded in the transaction sets, as these can differ between translation systems.

The EDI 997 Communication Process

The EDI 997 is always sent by both the buyer and vendor as a way of ensuring that the communication of the document was successfully executed. Through the EDI 997 the partners can audit which EDI exchanges were successful and which ones had issues. Like all other EDI documents, the EDI 997 must be generated through the EDI translator and then sent to the recipient through some electronic means. The senders computer will typically translate the EDI 997 into an EDI format, while the communication will take place either through an Internet EDI connection or through a Value Added Network (VAN).

When Is an EDI 997 Functional Acknowledgement Transmitted?

Whenever an EDI transaction is received, the remote party can send an EDI 997 Functional Acknowledgement, confirming receipt of the transactions that have been submitted and translated by the EDI system. This response has not confirmed the validity of the data, but rather an affirmation that it has been received. During translation of the data, some more advanced EDI 997s may respond if syntax errors occur in the initial transmission of transactional set data. This depends heavily on how the EDI operation has been set up in a particular EDI guide or mapping document.

Transmitting the EDI 997

Once the EDI 997 is ready to be sent to the recipient, one of two methods are going to be generally used. The first, and still most popular method, is the use of a VAN. A VAN acts as an intermediary between the two parties, facilitating the communication of the EDI 997 (and other EDI documents). Beyond simple delivery, the VAN is also responsible for ensuring that the transmission is secure throughout the entire process. This is always imperative, but even more so with documents like the EDI 997 that may include private and confidential information. A second popular option is the use of a direct connection through the Internet to exchange the EDI 997 between two parties. This second form of communication is also known as AS2 communication. When using AS2 to send the EDI 997, the document is encrypted at the source and sent using secure Internet-based protocols to the recipient which then must have software capable of decrypting the EDI 997 prior to translation.

Translating the EDI 997

Once an EDI 997 is received, the first step must be to translate of the document. An EDI 997, like any EDI document, in its native format is not meant to be read by a human operator. In the translation process, the EDI 997 will be converted into one of two forms. One of which is the "human readable" format that is usually in the form of a report that is either printed or more likely placed into a file format that is easily imported into an accounting or ERP system. Translating the EDI 997 into this more easily integrated format is the first key step in receiving the document before it can be used by the intended recipient.

What Happens After Sending an EDI 997 Functional Acknowledgement?

After you have transmitted an EDI 997 Functional Acknowledgment Transactional Set, then the next step is dependent on what transaction you are confirming transmission of. For example, if you are verifying the receipt of an EDI 810 Invoice, the next step would either be an EDI 864 Text Message to dispute the invoice due to an error or an EDI 820 Remittance Advice to detail payment for goods or services rendered. The next step after an EDI 997 is dependent on what the transmission is confirming and if the data is accurately received.

Integrating the EDI 997 Into Your Business

Once the EDI 997 is translated into a computer-ready format, a secondary in-house process takes the new file with the information that originated in the EDI 997 and moves it into the recipient's ERP or accounting system. At this stage of the transformation, the EDI 997 is now a document that can be identified and used by the recipient as the sender of the EDI 997 intended.

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