Reconciling Bank Statements

Copyright © 2007, Oracle. All rights reserved.

 Objectives

After completing this lesson, you should be able to do the

following:
• Explain how to automatically and manually reconcile
transactions
• Describe sweep transactions, reconciliation
tolerances, multicurrency matching and clearing, value
date, AutoReconciliation, and manual matching
• Describe creating bank statement cash flows from
bank file, payments, receipts, and miscellaneous
transactions
• Explain how to record exceptions and reversals

Copyright © 2007, Oracle. All rights reserved.

 Objectives

• Describe how to reconcile corrections and adjustments

to bank errors
• Describe reconciled and unreconciled transactions
• Explain how to clear and unclear transactions
• Describe transferring bank reconciliation transactions
to your general ledger
• Explain archiving and purging

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 Agenda

• Overview
– Linking to multiple sources
– Across operating units
• Reconciling Bank Statements Automatically
– Reconciling Sweep Transactions
– Defining Reconciliation Tolerances
– Multicurrency Matching and Clearing
– Value Date Support
– Reviewing Reconciliation Errors
• Reconciling Bank Statements Manually
– Defining Reconciliation Tolerances

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 Agenda

• Creating Bank Statement Cashflow from Bank

Statement
• Reviewing Reconciled Transactions
• Unreconciling Transactions
• Creating Payments, Receipts, and Miscellaneous
Transactions
• Recording Exceptions
• Entering Reversals
• Reconciling Corrections and Adjustments to Bank
Errors

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 Agenda

• AutoReconciliation and Manual Matching

• Manually Clearing and Unclearing
• Transferring Bank Reconciliation Transactions to Your
General Ledger
• Archiving and Purging

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 Overview

Receive bank Load and verify Perform

statement bank statement reconciliation

Create journal entries and Review results

post to general ledger

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 Overview (continued)

Use the AutoReconciliation program to

reconcile any bank statement in Oracle Cash
Management automatically.

Bank
Statement
Import
Bank
Statement
Import and
AutoReconciliation AutoReconciliaton

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 Overview (continued)

Reconciling to multiple sources

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 Overview (continued)

AP-US AP-GLOBAL AP-APAC

Reconciling across different operating units

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 Reconciling Bank Statements Automatically

Run Review Identify

AutoReconciliation AutoReconciliation reconciliation
program Execution report errors

Reconcile Correct errors and run

manually AutoReconciliation
(if necessary) program

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 Reconciling Sweep Transactions

Load, import, and reconcile bank statements with

bank-initiated sweep lines for bank accounts shared
between Oracle Payables and Oracle Treasury.

Create bank
Enter bank Run Bank
Set up statement
transaction Statement
cash mappings for
codes for sweep Loader/ Import
pools sweep
transactions programs
transactions
Run Sweep Run Auto- Manually Run the
Transactions Reconciliation reconcile a Unreconcile
Generation program sweep bank Bank Statement
program statement line program

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Reconciling Sweep Transactions (continued)

Sweep Transactions
Generation Execution Report
lists sweep transactions
generation exceptions

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Defining Reconciliation Tolerances

Auto
Enter
Reconciliation
reconciliation
computes the
tolerances as
tolerance
percentages
percentage
and/or amounts
amounts
Program selects Program attempts
the smaller of the to match the
computed statement line
amount or the against a
defined tolerance transaction range
amount

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Multicurrency Matching and Clearing

AutoReconciliation
matches multicurrency
transactions

Oracle Cash
Management clears
transaction
differences

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 Value Date Support

Payment Value Date

Date when cash is
withdrawn in a bank
account

Receipt Value Date

Date when cash is
realized in a bank
account

This information is critical when calculating interest

on bank accounts.

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 Reviewing Reconciliation Errors

Review Review all

reconciliation statement
errors online reconciliation
errors
Review
errors for
a specific
line

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 Reconciling Bank Statements Manually

Update the reconciliation for a

previously manually- or automatically-
reconciled statement

Reconcile any Create new

bank statement bank statement
you imported lines as you
or entered reconcile

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Creating Bank Statement Cash Flows from
Bank File
Define mapping rules in the
Bank Statement Cash flow
Mapping window

Use the Bank Statement Cash Flow Creation

program to create Cash flows automatically.
Journal entries will be created automatically
in GL from the Cash flows created.

Review the Journal Entry

Creation and Execution Report

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Reviewing Reconciled Transactions

The Reconciled
Transactions Window
shows the transaction
type (receipt, payment
or miscellaneous),
number, status, date,
and maturity date for
each reconciled
transaction.

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 Unreconciling Transactions

 Unreconcile any reconciled

transaction
 Unreconcile a specific
transaction that applies to a
bank statement line
 Unreconcile all transactions
that you have reconciled
against a statement

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 Creating Payments and Receipts

Create Payables payments or Receivables

receipts while manually reconciling a bank
statement, to add new payments or receipts
that were not entered previously in Payables
or Receivables, but which have cleared the
bank and show up in bank statement.

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 Creating Miscellaneous Transactions

Create miscellaneous
transactions to reflect
banking
activity, such as bank
charges.

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 Recording Exceptions

A bank statement can contain data about NSF

(non-sufficient funds) and rejected receipts,
stopped payments, direct deposits or debits,
transactions created outside Oracle Applications,
and/or irreconcilable errors against any
transactions.

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 Entering Reversals

You can reverse receipt transactions to

account for NSF and rejected receipts.

You can create a Standard

reversal.

You can create a debit

memo reversal for the full
amount of the receipt.

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 Reconciling Corrections and Adjustments to
Bank Errors: Reversal

The bank enters error corrections and adjustments

as miscellaneous transactions.

Reversal

Adjustment

The bank uses the same bank transaction codes you set up
for miscellaneous receipts/payments to identify the
statement lines generated for error corrections.

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 Reconciling Corrections and Adjustments to
Bank Errors: Adjustment

The bank enters error corrections and adjustments

as miscellaneous transactions.

Reversal

Adjustment

The bank uses the same bank transaction codes you set up
for miscellaneous receipts/payments to identify the
statement lines generated for error corrections.

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 AutoReconciliation Matching

Reversal Method Adjustment Method

Tries to match the Tries to find both a
reversal entry to a transaction and a
statement line statement line to
containing match to the
the same adjustment entry. The
transaction statement line must
number and contain the same
opposite transaction number as
transaction type. the adjustment line.

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Manual Reconciliation Matching

Reversal Method
Reconcile the reversal
entry with the error.

Adjustment Method
Reconcile the first
correction entry with the
original transaction and
the error.

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 Manually Clearing and Unclearing

You can choose to

manually clear You can also undo
receipts, payments, the cleared status
miscellaneous of a cleared
transactions, cash payment, cleared
management cash receipt, or open
flows, and open interface
interface transaction transaction.
without first
reconciling them.

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Transferring Bank Reconciliation Transactions to
Your General Ledger

In Payables, you create accounting

entries, and then submit the Payables
Transfer to General Ledger program to
transfer the accounting entries to the
General Ledger interface.

In Receivables, you submit the General

Ledger Interface program transfer
accounting entries to the General Ledger
interface.

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 Archiving and Purging

After importing a bank statement into Oracle

Cash Management, you can archive and purge
the data from the bank statement open
interface tables.

Archiving saves Purging deletes all

copies of the headers and
bank statements statement lines
information to from either the
archive tables open interface,
bank statement, or
both tables

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Archiving and Purging: Archiving and Purging
Automatically

Automatic archive
and purge applies
only to the open
interface tables,
not to the bank
statement tables.
Before any automatic
reconciliation,
archiving and purging
occurs after the
successful transfer of
the bank statement
information from the
open interface tables
to the bank statement
tables.

Copyright © 2007, Oracle. All rights reserved.

 Summary

In this lesson, you should have learned how to:

• Explain how to automatically and manually reconcile
transactions
• Describe sweep transactions, reconciliation
tolerances, multicurrency matching and clearing, value
date, AutoReconciliation, and manual matching
• Describe creating bank statement cash flows from
bank file, payments, receipts, and miscellaneous
transactions
• Explain how to record exceptions and reversals

Copyright © 2007, Oracle. All rights reserved.

 Summary

• Describe how to reconcile corrections and adjustments

to bank errors
• Describe reconciled and unreconciled transactions
• Explain how to clear and unclear transactions
• Describe transferring bank reconciliation transactions
to your general ledger
• Explain archiving and purging

Copyright © 2007, Oracle. All rights reserved.