cash management – bank reconciliation -...

Cash Management

Cash Management – Bank Reconciliation

Reconciliation

Version 1.0

Contents

1 Introduction ................................

1.1 Context................................

1.2 About This Document

2 Overview of the process

2.1 Inputs and triggers

2.2 Process step details

3 Document Control ................................

3.1 Revision History

3.2 Approvals ................................

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Document ...............................................................................................

Overview of the process ................................................................................................

Inputs and triggers ................................................................................................

Process step details ................................................................................................

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1 Introduction

1.1 Context

This is a work instruction for Bank Reconciliation process

function. The objective of this process is to

1.2 About This Document

1.2.1 Document Purpose

This document is a work instruction

substitute for training.

This is a living document that is constantly updated and improved.

1.2.2 Intended Audience

This document is intended to be read by:

• The Finance Team

1.2.3 Roles and Responsibilities

Role

Cash Management

Team

• Obtain bank statements from online banking on

Export

• Classify reconciliation type required into Manual or Automatic.

• For manual reconciliation, compare bank statement balance to

corresponding Bank GL

• For automatic recon

a file or

Bank Reconciliation process which is part of the Cash Management

. The objective of this process is to ensure all cash movements are recorded accurately.

About This Document

n. It should be used as reference guide and as a support but not a

is is a living document that is constantly updated and improved.

This document is intended to be read by:

Roles and Responsibilities

Responsibilities

Obtain bank statements from online banking on a weekly basis

xport bank statement to spreadsheet and save.

Classify reconciliation type required into Manual or Automatic.

For manual reconciliation, compare bank statement balance to

corresponding Bank GL balance.

o If comparison matches, then update excel rec.

o If comparison doesn’t match, then create in spreadsheet a

reconciliation between bank statement balance and GL

balance to identify errors / missing postings in payment /

receipt.

For automatic reconciliation, identify whether the upload is done

a file or manually.

o If manual, process manual bank statement in SAP

o If file upload, save bank statement in MT940 format and

Cash Management

ensure all cash movements are recorded accurately.

. It should be used as reference guide and as a support but not a

weekly basis.

Classify reconciliation type required into Manual or Automatic.

For manual reconciliation, compare bank statement balance to

If comparison matches, then update excel rec.

If comparison doesn’t match, then create in spreadsheet a

reconciliation between bank statement balance and GL

balance to identify errors / missing postings in payment /

the upload is done via

cess manual bank statement in SAP

save bank statement in MT940 format and

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• SAP will match bank

accounts where it can. Manually match off remaining transactions

where possible in SAP

Cash Collection (CC) • Correct error / missing postings in payment; send confirmation

email

Accounts Payable

(AP)

• Correct

There are key dependencies with the

• Account Payable need to complete payment postings.

• Credit Control team needs to

import file with parameters “Post Immediately”

SAP will match bank transactions against items posted in clearing


where possible in SAP

Correct error / missing postings in payment; send confirmation

email

Correct error / missing postings in receipt; send confirmation email

There are key dependencies with the Account Payable and Cash Collection teams.

need to complete payment postings.

to complete receipt postings.

import file with parameters “Post Immediately” in SAP

transactions against items posted in clearing


Correct error / missing postings in payment; send confirmation

; send confirmation email

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2 Overview of the process

2.1 Inputs and triggers

The process starts with Cash Management Team

banking as weekly activity.

2.2 Process step details

2.2.1 Obtain Statement

1. Cash Management Team

And, export bank statement to

folder.

2. Classify reconciliation type

a. Manual; compare bank statement balance to corresponding bank GL balance

refer to section 2.2.5

b. Automatic; check file upload type and classify

i. Manual;

continues in SAP

Overview of the process

Cash Management Team obtaining bank statements from online

Cash Management Team to obtain bank statements from online banking on weekly basis

xport bank statement to spreadsheet (MS Excel) and save in bank statement

Classify reconciliation type into any one of the below categories

Manual; compare bank statement balance to corresponding bank GL balance

section 2.2.5

Automatic; check file upload type and classify it into manual or automatic

Manual; copy and paste bank statement from spreadsheet. This process

continues in SAP, refer to section 2.2.2 for further instructions.

from online

banking on weekly basis.

in bank statement

Manual; compare bank statement balance to corresponding bank GL balance,

automatic

opy and paste bank statement from spreadsheet. This process

for further instructions.

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ii. Automatic;

with parameters “Post Immediately”. This process continues in SAP

to section 2.2.3

2.2.2 Copy and Paste bank statement in Excel

1. Use transaction code “FF67

Enter:

2. “Specification” screen is displayed.

else goes to next screen)

Enter the following fields in

• Tick on “Import advices

Automatic; resave bank statement as MT940 file format. Then, Import file

with parameters “Post Immediately”. This process continues in SAP

section 2.2.3 for further instructions.

Copy and Paste bank statement in Excel (Process Manual Bank Statement)

FF67” in command field of SAP Easy Access screen and press

screen is displayed. (Screen appears when you process for first time only

else goes to next screen):

Enter the following fields in “Specification” screen:

Import advices”

esave bank statement as MT940 file format. Then, Import file

with parameters “Post Immediately”. This process continues in SAP, refer

(Process Manual Bank Statement)

P Easy Access screen and press

hen you process for first time only

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• Start variant : select

• Process type : Select “4”

• Press Enter or click on

3. “Process Manual Bank Statement


• Bank Key (Sort Code

• Bank Account (Account #

• Currency (as applicable)

• Statement Number

Please note: click on Overview button

• Statement Date : date on the

On the same screen go to “

select “SAP01” from the drop-down menu (Memo record entry section)

Select “4” from drop-down menu (Further processing section)

click on

Process Manual Bank Statement” screen is displayed:

Enter the following fields in “Process Manual Bank Statement” screen:

Sort Code)

Account #)

(as applicable)

(as applicable)

: click on Overview button to get the last statement #

ate on the bank statement

On the same screen go to “Control” section enter the following fields:

(Memo record entry section)

(Further processing section)

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• Opening Balance :

• Closing Balance : from the bank statement

• Posting Date : week ending

• Press Enter

4. The below “Process Manual Bank Statement


statement items:

• Trans : 009+ (use this transaction type for cash receipt)

• Value date : statement

• Amount : value on the statement from the customer

• Doc. No. : customer

Please Note: Copy / paste bank statement items from soft copy as applicable

5. On the “Process Manual Bank Statement

click on “Save” as displayed below:

: previous day’s closing balance

rom the bank statement

week ending date

Process Manual Bank Statement” screen is displayed:

following fields in “Bank statement items” section of the screen for each bank

(use this transaction type for cash receipt)

statement date

alue on the statement from the customer

ustomer invoice #.

Copy / paste bank statement items from soft copy as applicable

Process Manual Bank Statement” screen, click on “Bank Statement” menu and

“Save” as displayed below:

for each bank

Copy / paste bank statement items from soft copy as applicable.

screen, click on “Bank Statement” menu and

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6. On the “Process Manual Bank Statement

“Post” and click on “Individual s

7. “Update Account Statement/

• The amount posted on the Bank Account # can

• The below confirmation message is displayed at the bottom of the screen

Process Manual Bank Statement” screen, click on “Bank Statement” menu, select

“Post” and click on “Individual statement” as displayed below:

tatement/Check Deposit Transaction” screen is displayed

sted on the Bank Account # can be viewed in above screen.

confirmation message is displayed at the bottom of the screen

.

Statement” menu, select

s displayed:

be viewed in above screen.

confirmation message is displayed at the bottom of the screen.

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2.2.3 Import Bank Statement File

1. Use transaction code “FF_5

Enter:

mport Bank Statement File

FF_5” in command field of SAP Easy Access screen and press

in command field of SAP Easy Access screen and press

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2. “Bank Statement Various Formats (Swift, Multicash, BAI..,)


File Specification section:

• Tick Import data

• Electronic Bank Statement format

the drop-down menu

• Statement file: click

• Tick on Work station upload

Posting parameters section:

• Select option “Post Immediately

Bank Statement Various Formats (Swift, Multicash, BAI..,)” screen is displayed:

Enter the following fields in above screen:

File Specification section:

Electronic Bank Statement format: select “SWIFT MT940 with field structure

down menu

click on to get the path of Imported Bank statement File location.

on Work station upload

parameters section:

Post Immediately”

is displayed:

SWIFT MT940 with field structure” from

ted Bank statement File location.

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• Tick on “Assign value date

Output Control section:

• Tick on Print bank statement

• Tick on Print Posting log

• Tick on Print statics

• Click on Execute

3. “Bank Statement Various Formats (Swift, Multicash, BAI..,)

• The above screen confirms that the bank statement upload was successful.

• Check closing balance agrees to statement closing balance.

• Once the Bank reference

invoice is offset against the payment.

• The invoices which do not get posted against the Payment need to be done manually

by FEBAN.

2.2.4 Manually Match Off Transactions

1. Use transaction code “FEBAN

Enter:

Assign value date”

Tick on Print bank statement

Tick on Print Posting log

Tick on Print statics

Bank Statement Various Formats (Swift, Multicash, BAI..,)” screen is displayed:

The above screen confirms that the bank statement upload was successful.

Check closing balance agrees to statement closing balance.

ank reference number (Invoice # or customer #) match against each other

invoice is offset against the payment.

The invoices which do not get posted against the Payment need to be done manually

f Transactions

FEBAN” in command field of SAP Easy Access screen and press

screen is displayed:

The above screen confirms that the bank statement upload was successful.

) match against each other

The invoices which do not get posted against the Payment need to be done manually

y Access screen and press

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2. “Selection of bank statements by banks and Account Nos.


• Company Code

• House Bank

• Account ID

Selection of bank statements by banks and Account Nos.” screen is displayed:

Enter the following fields in “Hdr data” section of the above screen:

” screen is displayed:

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• Press Execute button

3. “Edit Bank Statement” screen is displayed:


• The transactions #

• The transactions #

These will have to be processed manually.

4. To process / post manually on the “

red, click on “Statement

Execute button

” screen is displayed:

Enter the following fields in “Edit Bank Statement” screen

# posted successfully is in green.

# that weren’t automatically matched in red.

be processed manually.

To process / post manually on the “Edit Bank Statement” screen, select the statement in

click on “Statement Items” menu, click on “Post” as displayed below:

select the statement in

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5. “Post with Clearing Select open items


elect open items” screen is displayed:

Enter the following fields in “Post with Clearing Select open items” screen:

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• Company Code

• Account (incoming / outgoing as applicable

• Click on “Process Open Items”

6. “Post with Clearing Process open items


• Allocate the payment received

amount for the relevant invoice.

• Click on Post button

7. Use transaction code “FEBAN” in command field of SAP Easy Access screen and press

Enter. This is to verify if payment is posted. The below screen

posted automatically before

incoming / outgoing as applicable)

Open Items”

Post with Clearing Process open items” screen is displayed:

Enter the following fields in “Post with clearing select open items screen” screen

Allocate the payment received (Not assigned) to the invoice by double-clicking on the

amount for the relevant invoice.

Post button

Use transaction code “FEBAN” in command field of SAP Easy Access screen and press

Enter. This is to verify if payment is posted. The below screen displays a transaction

before but manually posted successfully after:

” screen

clicking on the

Use transaction code “FEBAN” in command field of SAP Easy Access screen and press

transaction # not

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2.2.5 Complete Bank Reconciliation


balance.

2. If bank statement balance and corresponding bank GL balance match, then

Management Team update Excel rec

The process ends.

3. If bank statement balance and c

Management Team create in Excel a reconciliation between bank statement balance and

GL balance to identify errors / missing postings.


the below two categories and send emails to respective team for corrections.

a. Payment; Account Payable

confirmation email to

b. Receipt; Cash Collection

confirmation email to

5. After receiving confirmation from Cash Collection / Account Payable teams that

missing posting has been corrected,

reconciliation type and classify it into any one of the below two categories.

a. Manual; Cash Management Team

b. Automatic; Cash

nk Reconciliation

Cash Management Team to compare bank statement balance to corresponding bank GL

If bank statement balance and corresponding bank GL balance match, then

update Excel rec. Financial Accountant then reviews and

If bank statement balance and corresponding bank GL balance don’t match,

create in Excel a reconciliation between bank statement balance and

GL balance to identify errors / missing postings.

Management Team classify each identified error / missing posting into any one of


Account Payable team to correct error / missing posting; send

confirmation email to Cash Management Team

Cash Collection team to correct error / missing posting; send

confirmation email to Cash Management Team`

After receiving confirmation from Cash Collection / Account Payable teams that

been corrected, the Cash Management Team check the

reconciliation type and classify it into any one of the below two categories.

Cash Management Team to continue process with Section 2.2.5

Cash Management Team to continue process with section 2.2.4

to compare bank statement balance to corresponding bank GL

If bank statement balance and corresponding bank GL balance match, then Cash

then reviews and approves it.

n’t match, then Cash

create in Excel a reconciliation between bank statement balance and

classify each identified error / missing posting into any one of


team to correct error / missing posting; send

team to correct error / missing posting; send

After receiving confirmation from Cash Collection / Account Payable teams that error /

check the

Section 2.2.5

section 2.2.4

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3 Document Control

3.1 Revision History

Version Date Author

0.1

3.2 Approvals

The following roles relate to the most recent version of this

History above.

Name Title

Emily Burlington Process Owner

Agnes Muszynska Process

Mike Pollard Head of Finance

Control

Author Description

The following roles relate to the most recent version of this document as listed in the Revision

Title Signature Date

Process Owner

Process Sponsor

Head of Finance

document as listed in the Revision

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