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Introduction

Oracle Cash Management is an enterprise wide solution for managing


liquidity and controlling cash.

Cash Management gives you direct access to expected cash flows from
your operational systems.

You can quickly analyze enterprise wide cash management cash


requirements and currency exposures, ensuring liquidity and optimal
use of cash resources.

Benefits of Cash Management

Forecast cash flows in any currency and in multiple time periods

Streamline the reconciliation process

Monitor for exceptions and fraud

Forecast based on historical or future transactions

Manage the cash cycle efficiently and with control

Cash Management Integration

Cash Management is integrated with Payables, Receivables and


General Ledger.

Payables: Payments information automatically transfers to CM without


any process.

Receivables: to transfer Receipts information to CM remittance process


is required.

From AR only remitted eligibility transactions will transfer to CM.

GL: If we have entered any journal in GL with cash account, that data
will flow to CM.

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Cash Management is used mainly for 2 purposes


1. Reconciliation
2. Forecasting

Forecasting is used to identify the future cash inflows and outflows of


an Organization.

Reconciliation:

Normally at the end of every period, the entries in the cash book are

compared with entries in the pass book.


The exact causes of differences are scrutinized and then bank

reconciliation statement is prepared.


Necessary suitable entries will passed in the cash book.

Reconciliation process is 3 types:


1. Manual Clearing Process
2. Manual Reconciliation
3. Automatic Reconciliation

Manual Clearing Process:


In this process we will manually clear the transactions without entering
the bank statement into Oracle.

Manual Reconciliation:
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In this process we will manually enter the bank statement into Oracle. We
will take the transactions one by one and search for the bank transactions
manually and mark the transactions as reconciled.

Automatic Reconciliation Process


Automatic Reconciliation process can be done in 2 ways:
We will enter bank statement into Oracle and run a program, so that
system will search the transactions and will reconcile automatically.
In another way, in the case where bank statement transactions are
more and not possible to enter manually into oracle, in that case, we
will upload the bank statement into Oracle through specific formats:
BAI 2 & SWIFT 940
These formats are used to upload bank statements into Oracle.
Once we received bank statements in the above formats from the
bank, we will place these files in a directory where cash management
application is stored.
We have to run Bank statement load program.
We have to define Bank codes for transaction identification purpose.

Define Cash Management Responsibility


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Navigation:

System Administrator

Security Responsibility Define

Application:

Cash Management

Menu:

CE _ Super User

Request group:

All Reports Cash Management

Assign Profile Options to Cash Management Responsibility

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Navigation:

System Administrator
Profile System

Profile Options:
1.
2.
3.
4.
5.

GL Ledger Name
HR Business Group
HR Security Profile
HR User type
MO operating unit

Assign Cash Management Responsibility to User

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Navigation:

System Administrator
Security User Define

Assign Balancing Segment Values to Legal Entity

Navigation:

General Ledger
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Setup Financials Accounting Setup Manager Accounting Setup

Query your ledger


Click on update accounting options
Go to legal Entity tab
Click on Update Balancing Segment Values
Click on Add balancing Segment values
Choose the Balancing Segment values to assign to Legal Entity
Apply.

System Parameters
System parameters are controlling features at Legal Entity Level.
Navigation:

Cash Management
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Setup System System Parameters

Choose Legal Entity


Choose Ledger
Enter Begin date

Go to System Controls tab:


Enable the check boxes

Show cleared transactions


Show void Payments
Allow adding lines to imported statement
Archive / Purge

Enter lines per commit


Choose Signing authority approval.

Go to Cash Management Transactions tab


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Choose Exchange rate type


Bank Statement Cash flow Rate Date: Cleared date
Bank Transfer Rate Date: Cleared Date
Bank Account Transfers
Authorization: Not Required.

Enter Bank statements


Bank statements will be received from bank and entered in the Oracle
cash management.
It contains 2 levels of information.
1. Bank statement header
2. Lines
Bank statements can be created in 2 ways.
1. Manual
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2. Import bank statements

I.

Enter Manual Bank Statement


Navigation:
Bank Statements Bank Statements and Reconciliation

Say New

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Choose Internal Account Number


Choose Statement date
Enter Opening Balance, Receipts and Payments details
Click on Lines button

Enter receipts and payments information


Save and close this window.
II.

Import Bank statement


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We will import bank statement into Oracle application through the program
Bank statement import.
This program will support 2 types of bank statement file formats.
1. BAI 2
2. Swift 940

Navigation: View Request

Say OK.

Reconciliation

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Reconciliation means: matching either payment or receipt with the bank
statement is called reconciliation.
Reconciliation can be done in 2 ways.
1. Manual Reconciliation
2. Auto Reconciliation

I.

Manual Reconciliation

Payment Reconciliation:
Step: 1
Query the payment document which you want to reconcile to view the Status
Navigation:

Cash Management

View Payments

Step: 2
Navigation:

Reconcile the Payment Document


Bank Statements Bank Statements and Reconciliation
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Query your account number


Query statement number
Say Find

Place the cursor on statement number line


Say review

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Click on Lines

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Place cursor on the payment line
Click on Available

Choose Detail
Enable AP Payment check box
Say Find

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Select the transaction type


Say Reconcile

Now the Status is Reconciled


For receipt reconciliation:
Choose receipt class and Payment method

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Say Find and Mark


Transaction will be automatically selected by system.
Status will be changed to Reconciled from Remitted.

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II.

Auto Reconciliation

Auto Reconciliation is used to reconcile payments or receipts automatically


by running a program.

Step: 1
Navigation:

Define Bank transaction codes


Setup Banks Bank Transaction Codes

Query your Bank account


Say OK

Choose Type Payment & Receipt


Enter code for each type

Save your work


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Step: 2
Navigation:

Create Bank Statements


Bank Statements Bank Statements and Reconciliation

Say New

Choose:
Bank account number
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Enter statement number
Enter Receipts and Payment Details
Click on Lines

Enter Line details


Save your work.
Now the status is Un reconciled

Step: 3
Navigation:

Run auto reconciliation program


View Request

Submit a new request


Single request

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Say OK
Program Name:

Auto Reconciliation

Parameters:
Choose Bank branch Name
Bank account number
Statement number

Say OK
Say Submit
Ensure program completed normal

Step: 4
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Query the bank statement to check the reconciliation status in the bank
statement lines
Navigation:

Bank Statements Bank statements and reconciliation

Choose account number & statement number


Say Find

Place cursor on the Account number and say Review

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Click on Lines button

Now you can see the status as Reconciled

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Step: 5

check the reconciliation status in AP Payments

Navigation:

Accounts Payables

Payments Inquiry Payments

Enter payment document number


Say Find

Now the status is Reconciled Un accounted


Accounting: Partial
Go to Payments Enter window
Query the payment document number
Go to Actions

say Create accounting

Re query the payment document

Now the status is Reconciled

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Bank Account Transfer Transfer of Funds within 2
bank accounts

This concept is used to transfer the balances from one bank account to
another bank account.

Step: 1

Complete Intra Company / Inter Company setup in the GL

Navigation:
Setup Financials Accounting Setup manager Accounting Setup

Step: 2
Navigation:

create new bank account


setup Banks Bank Accounts

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Click on Create button

Choose Country
Choose Bank Name
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Choose Branch Name
Say Continue

Choose:
Legal Entity as Bank Account Owner
Account Use:
Payables & Receivables
Say Next

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Enter Account Name


Enter Account Number
Choose Currency: INR
Enable check box of Multiple Currencies Allowed
Account type: Other

Save and Next


Go to General Controls fields
Choose:
Cash Account
Cash Clearing Account

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Save and next

Click on Add Organization Access


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Choose:
Account use:
Payables & receivables
Organization; Choose Operating unit
Say Continue
Say Apply

Say Finish
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Step: 3

Create Bank Account Transfer

Navigation:

Cash management Bank Account Transfers

Say Create
Go to General Information tab

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Choose:

Settle transactions through Oracle Payments: No


Transfer date
Currency
Enter transfer amount
Enter Comments

Enter Source Bank Account and Destination bank account


Say Apply

Now the status is: NEW


Click on Validate button

Now the status is: Settled


Step: 4

clear the transaction in the payment bank account


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Navigation:

Cash Management

Bank statements Manual Clearing Clear Transactions

Choose:
Detail
Cash Management Cash flow

Go to Bank tab
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Choose payment account number
Say Find

Select the transaction type


Say Clear Transaction

Step: 5

clear the transaction in the Receiving bank account

Navigation:

Cash Management

Bank statements Manual Clearing Clear Transactions

Choose:
Detail
Cash Management Cash flow
Go to Bank tab
Choose payment account number

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Say Find

Select receipt: transaction type


Say Clear transaction
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Step: 6
Navigation:

Run Create Accounting program and Transfer to GL


View Request

Submit a new request


Select single request
Say OK

Name: Create Accounting

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Parameters:

Choose your Ledger


Enter End Date
Mode: Final
Errors only: No
Report: Detail
Transfer to GL: Yes
Post in GL: No
Include user transactions identifier: No
Say OK
Say Submit
Ensue the below programs completed Normal
1. Create Accounting
2. Accounting Program
3. Journal Import
4. Sub ledger Accounting balances

Step: 7
Navigation:

Query the journals in GL and post


Journal Enter

Choose:

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Ledger Name
Source as Cash Management

Say Find

Place cursor on un posted journal


Say Review Journal

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Say Post

Ensure Concurrent ID request completed normal

Step: 8

View Bank Balances

Navigation: Cash Management Bank Balances

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UN Reconciliation

Step: 1
Navigation:

Query the bank statement line which you want to un reconciled


Bank Statements Bank Statements and Reconciliation

Say Find

Place cursor on the Account number and say Review

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Click on Lines button

Now you can see the status as Reconciled


Choose the line and say Reconciled

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Select the payment line and say un reconcile button

Now the status is un reconciled


Save your work.

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Step: 2
Navigation:

Query the payment document to check the status


CM View Payments

Query payment document number

Now the status is Negotiable

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Causes of Differences:
1. Checks deposited into bank but not yet collected and credited
2. Checks issued but not presented for payment
3. Bank charges
4. Amount collected or credited by bank on standing instructions
5. Amount paid or debited by bank on standing instructions
6. Interest credited by the bank
7. Interest debited by the bank on over draft
8. Direct payment by customers into the bank account
9. Dishonor of checks or bills
10.

Errors

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Format of Bank Reconciliation Statement


Bank Reconciliation statement as on 03/31/2011.
------------------------------------------------------------------------------------Particulars

Rs.

Rs.

------------------------------------------------------------------------------------Balance as per cash book


Add:
1. Checks issued but not yet presented for payment
2. Interest allowed by bank
3. Direct payments by a customer into bank
Less:
1. Checks deposited into bank but not yet collected
2. Bank charges
3. Dishonored checks or bills
Balance as per Pass Book

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IMPORTANT REPORTS IN CASH MANAGEMENT

1. Auto Reconciliation
2. Bank Statement detailed report
3. Bank statement summary report
4. Batches available for reconciliation
5. Cash in Transit report
6. Cleared Transactions report
7. General Ledger reconciliation report
8. Unreconciled bank statement
9. Transactions available for reconciliation report
10.
Auto reconciliation execution report
11.
Bank statement by document number report
12.
Bank transactions code listing

Cash Management period closing procedures

Ensure the following before closing the Payables & Receivables.

Any reconciliation transactions created by Cash Management

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are properly entered.

Account balances are updated.

Reports include accurate information.

Specifically the following steps are recommended.


1.

Reconcile all your bank statements.

2.

Transfer all transactions from Payables to your General Ledger


interface tables.

3.

Run Journal Import in General Ledger.

4.

Post journals in General Ledger.

5.

Run the GL Reconciliation Report from Cash Management for each


bank account. This report compares the statement balance you
specify to the General Ledger ending balances.

6.

Review the report for errors.

7.

If there are errors in the report, correct them in Cash


Management, as needed. Repeat the above steps until there are
no more errors.

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