Hi,
Once you release the document using PHAP_PREPARE, it would go to employee to set his/her KPI/KRA's and then only it would go to Manager. Have you defined the relationship between Employee and Manager. After release the appraisal document, check in employee id.
You have to create document using PHAP_PREPARE once for all employees. If there is a different requirement from Client, copy the program and customize according to requirement.
Srikanth