About Bank Reconciliation
There are two major process steps you need to follow when reconciling bank statements: 1. Load Bank Statements: You need to enter the detailed information from each bank statement, including bank account information, deposits received by the bank, and payments cleared. You can enter bank statements manually or load electronic statements that you receive directly from your bank. See: Entering Bank Statements Manually and Loading Bank Statement Open Interface. 2. Reconcile Bank Statements: Once you have entered detailed bank statement information into Cash Management, you must reconcile that information with your system transactions. Cash Management provides two methods of reconciliation: o Automatic- Bank statement details are automatically matched and reconciled with system transactions. This method is ideally suited for bank accounts that have a high volume of transactions. See: Reconciling Bank Statements Automatically. o Manual- This method requires you to manually match bank statement details with system transactions. The method is ideally suited to reconciling bank accounts that have a small volume of monthly transactions. You can also use the manual reconciliation method to reconcile any bank statement details that could not be reconciled automatically. See: Reconciling Bank Statements Manually.
During the reconciliation process, you can create miscellaneous transactions for bank-originated entries, such as bank charges and interest. You can also manually enter Payables payments or Receivables receipts. The automatic reconciliation process can be set up to create miscellaneous transactions automatically.
When you reconcile a transaction, the transaction is first matched to bank statement details and then cleared (if uncleared). Alternatively, you can manually clear Payables payments, Receivables receipts, miscellaneous transactions, open interface transactions, and Cash Management cashflows (except for those created from bank statement lines) in Cash Management prior to reconciliation to maintain more up-to-date cash account balances. You can also use Automatic Clearing to clear receipts in Oracle Receivables.
we recommend that you review your reconciliation results. You can enter exchange rates manually. You can also use the following reports:
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Bank Statement Detail Report Bank Statement Summary Report Bank Statements by Number Report
Create Accounting Entries in Payables
You can create accounting entries for Payables accounting events in two ways:
Submit the Payables Accounting Process. Prerequisites
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Define Payables options for accounting information. You cannot clear Payroll payments. If you use Multiple currencies. If the transaction is an open interface transaction. they must be validated. Open the period in Payables.When you clear a transaction. or Treasury settlements. Receivables automatically generates the accounting entries. Cash Management assigns a cleared date. The exception report lists transactions that could not be accounted because of invalid or missing information. General Ledger journal entries. or submit AutoRate to automatically enter exchange rates for invoices and payments without exchange rates.
After the process completes. You can review the reports that are printed automatically from the AutoReconciliation program. Payables produces the Accounting Entries Audit Report and Accounting Entries Exception Report. then all foreign currency transactions require exchange rates. Accounting for the cleared transaction varies by the source. update the status of matured future dated payments to Negotiable. you must customize the CE_999_PKG package to implement reconciliation accounting. If the transaction is a receipt or a miscellaneous transaction. Create accounting entries for a single transaction or batch. and status to the transaction. cleared amount. Payables records the accounting information but you create the accounting entries in Payables.
Review and Summarize Results
Once you have completed the reconciliation process. To account for invoices.
. If you use future dated payments. If the transaction is a payment.
then you can submit Journal Import. or you must choose the All parameter to account for invoices. Payables retains the accounting entries. you can enter bank statement information manually. Also. or separately. Submit and review the Unaccounted Transactions Report to identify and resolve issues with your transactions that will prevent accounting.
Define your banks. you enter the bank statement header and the transaction lines. You can enable users to update information on a statement that was previously entered manually or loaded automatically. after the transfer process completes. you can use the data in the GL interface to create and post journal entries in your general ledger. When you enter a bank statement manually. and then payments. and uses this order to calculate cumulative bank account balances. headers. which uses the data in the GL interface to create unposted journal entry batches. even if the statement is already reconciled.
Transfer Accounting Entries to Your General Ledger
After you create accounting entries in Payables. after you post journal entries in Oracle General Ledger. so you can continue to review them in Payables. You can submit Journal Import either when you submit the transfer program. See: Importing Journals. the invoices must already be accounted. and lines within General Ledger to update your General Ledger account balances. If you use Oracle General Ledger. You can then post these journal entry batches. or you can reconcile the bank statement (manually or automatically) after you enter all the transaction lines and save your work.
Entering Bank Statements Manually
In addition to loading bank statement information automatically with the Bank Statement Open Interface.•
To account for payments. You can reconcile transaction lines as you enter them. you can drill down to the related accounting entries or transactions in Payables. Note: Cash Management assumes that you enter statements in chronological order. headers.
. submit the Payables Transfer to General Ledger program to send invoice and payment accounting entries to the general ledger interface. and lines. If you do not use General Ledger.
the default is the Statement Date. 8.
If you have enabled the Allow Adding Lines to Imported Statements feature in the System Parameters window. Choose Lines to begin entering your statement lines. Additional Information: If you use automatic document sequence numbers. Note: For document sequencing. the effective date is the statement date. you need to define bank transaction codes for the bank account.
. Choose New. Enter control totals for Receipts and Payments. 3. you or your System Administrator must set up sequential document numbering for Cash Management. Additional Information: You can compare the Control Total amounts to those displayed by Cash Management in the Line Totals tabbed region of the Statements window. to ensure the completeness and correctness of your entered bank statement. you can add lines to automatically-loaded statements. Account Name. and Currency. 6. Navigate to the Find Bank Statements window. enter Bank Statement Control Totals: Enter the opening and closing balances as needed. Enter the Statement Number. 10. Bank Name. If you want to use document sequences. You cannot edit an automatically assigned Document Number. Enter the Statement Date. Optionally. Bank Branch. 2. enter the Statement Document Number. 5.• • •
If you plan to use the Bank Statement Import program. 9. Save your work. Set up Receivables activities and payment methods for miscellaneous transactions. Cash Management creates the Document Number for the statement automatically. Enter the following bank header information: Account Number. 4. as well as the number of statement lines for each. Enter the GL Date . The GL Date must be in an open or a future-enterable period in Receivables or Payables.
To enter a bank statement manually:
1. Choose the New button to display the Bank Statement window. 7. If you use manual document sequence numbers. you can save the header information now and enter the statement lines later. Optionally.
When the Tolerance Differences parameter is set to Charges or is not defined the amount difference between the statement line amount and the transaction amount defaults to the Charges field. you can create a miscellaneous transaction to account for bank charges or interest. you can create new bank statement lines as you reconcile transactions. you need to create exposure transactions in Oracle Treasury. In addition. and Cash Management Cashflows:
When the Tolerance Differences parameter is set to Errors. Payables payments. the statement line charges amount defaults to the Charges field. For example. whether imported or entered manually. transaction date. GL journal entries. open interface transactions. batch name. as well as update the reconciliation information for a previously manually or automatically reconciled statement. If the bank statement belongs to a bank account shared by Oracle Treasury and Oracle Cash Management.Reconciling Bank Statements Manually
In Cash Management you can reconcile a bank statement manually as well as automatically. Document Number. you reconcile each bank statement line with available transactions. you can search for Treasury settlements using the Reconciliation Open Interface. or Line Number.
Recalculating Amount Differences
When manually reconciling. You can search for Payroll payments. you may need to create transactions to account for differences between the sum of the reconciled transaction and the line amount. To account for amount differences for Treasury settlements. Cash Management Cashflows. The remaining amount difference between the statement line amount and the transaction amount defaults to the Errors field. You can also create Payables payments and Receivables receipts from Cash Management. and maturity date. Journal Entry Name. miscellaneous transactions. transaction amount. you can automatically default the amount difference between the statement line amount and the transaction amount to the Charges and Errors field based on how the Tolerance Differences parameters are set.
For Receivables receipts or remittance batches:
. as well as ranges for transaction numbers. and reconcile the statement line against them. You can search for transactions based on customer or supplier. As you reconcile a statement manually. Receivables receipts. and statement lines that meet specific criteria. or remittance number. When you use manual reconciliation. You can search for journal entries based on Period Name. For Payables payments or payment batches. You can use the manual method to reconcile any bank statement.
See: Customizing the Presentation of Data. or override it on the individual payment or receipt transaction. Reconcile other statement lines. 4. Import or manually enter the statement information. Bank Branch. 6. statement Date. Select the statement line that you want to reconcile. 2. (Optional) Choose the Recalculate button. Choose Find to see the Reconcile Bank Statements window containing the statements that meet your query criteria. Enter your search criteria in the Find Transactions window. Enter the query criteria for the statement you want to reconcile. including Bank Name. 8. bank Currency. Choose Lines to see the Bank Statement Lines window. Select the available detail and batch transactions that apply to the current bank statement line. you cannot change the Document Number either. and Statement Number. or leave the criteria blank to query all existing statements. 5. You can update it. 7. Note: You can open custom folders that display statement information in a custom format if you or your organization has defined any. and choose Review. 11. See: Using AutoLockbox and Running AutoLockbox. You can update any of the header information except for the bank information and the Currency. If you use automatic document sequence numbers. Choose Available to search for detail or batch transactions that are available for reconciliation. with the header information for the account you queried.
The amount differences between the statement line amount and the transaction amount defaults to the Charges field.
To manually reconcile a previously-entered bank statement:
1. Document Number. 12. you must create the related receipts manually in Receivables before you can reconcile them in Cash Management. 10. Navigate to the Find Bank Statements window. 13. 9. Cash Management displays the Bank Statement window. Note: If you don't use Oracle Receivables Automatic Lockbox. and your bank statement includes direct deposits or bank transfers. Reconcile the available detail or batch transactions. 3. The GL date defaults to the bank statement date. Select the statement you want to reconcile.
So. mark your bank statement as complete. 16. Reverse any NSF or rejected bank transactions. (Optional) Create miscellaneous transactions for bank statement transactions with no matching Payables. you must have Oracle Receivables installed and set up. to create miscellaneous payments. You can review the results of reconciliation in the following reports: o Bank Statement Detail Report
. 15. 18. Save your work. Note: Miscellaneous payments are actually handled as negative receipts by Cash Management.14. Optionally. 19. or General Ledger activity. 17. when you have reconciled all the bank statement lines. (Optional) Create payments or receipts for bank statement transactions with no matching Payables or Receivables activity. Receivables.