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Overview of Cash Management

Oracle Cash Management provides comprehensive bank reconciliation and cash forecasting capabilities. It manages an organization's cash inflows and outflows through the cash cycle. Bank accounts must be set up by creating a legal entity, bank, bank branch, and the account. There are internal and external bank accounts. Internal accounts are for payments to creditors and receipts from debtors. External accounts hold creditors' bank details. The solution supports bank reconciliation through parse rules, reconciliation rule sets with matching and tolerance rules.

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preeti kumari
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71 views

Overview of Cash Management

Oracle Cash Management provides comprehensive bank reconciliation and cash forecasting capabilities. It manages an organization's cash inflows and outflows through the cash cycle. Bank accounts must be set up by creating a legal entity, bank, bank branch, and the account. There are internal and external bank accounts. Internal accounts are for payments to creditors and receipts from debtors. External accounts hold creditors' bank details. The solution supports bank reconciliation through parse rules, reconciliation rule sets with matching and tolerance rules.

Uploaded by

preeti kumari
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Cash management

Oracle Cash Management is an enterprise cash management solution that helps you
effectively manage and control your cash cycle (Cash-in-flow and Cash-out-flow). It
provides comprehensive bank reconciliation and flexible cash forecasting.
The data of cash management does not flow to GL directly it flows through account
payables and account receivables.
In order to create bank account first you have to create a legal entity and assign it to ledger .
Bank related setups
1) Bank
2) Bank branch
3) Bank Account
.

There are two types of bank account which we will be creating


1) Internal : Own organization’s account from which co. will make payment to
creditors or receive money from debtors.
2) External : in payables at the time creation of vendor master we enter bank
details of creditors whom we shall make payment.
Steps:- To create Internal Bank
Setup and maintenance  Financials  Cash management and banking 
Manage banks  +  enter all the details by asking required information
from business  Save  now you can add bank address and contact person of
that bank like CEO or Bank manager and his physical address by simply clicking on
‘Addresses’ and ‘Contacts’ on the page and ‘+’ sign  Save & close.
Steps :To create bank branch

Manage Banks  Select bank name you want to create branch for  click ‘Create Branch’ 
Fill all details  Save and close.
Field details :

Routing number: like Ifsc code of foreign banks


BIC code: Bank Identification Code.
EDI ID : The Electronic Data Interchange (EDI) location code for this bank.
Alternate branch name: You can enter an alternate name for your bank branch. This is particularly useful if you do business
in
Japan, which allows you to enter both Kanji and Kana values for your bank branch name. 
Branch Type:
ABA: American Bankers Association
CHIPS: Clearing House Interbank Payment System
SWIFT: Society for Worldwide Interbank Financial Telecommunication
OTHERS

Addresses: Address of that branch


Contacts: Who are the key people to be contacted for this branch
.
Steps: Bank Account
Setup & maintenance  Financials  Cash and bank management  Manage bank account 
+  Enter details  Save & close
The four areas associated with defining an account are:
•General information
•Control of the account
•Security and access to the account
•Business unit assignment
Field details in general setup page in account creation:
Cash: The cash account that you are associating with a bank account. 
Cash Clearing:
2) Control:
Field details in control setup page in account creation:

A) Parse Rule Sets: Cash Management supports parse rule sets to transform data during the bank
statement import process. Parse rules are used to move data from one field to another. The parse rule
set is associated to a bank account in the bank account setup.
Each parse rule within a parse rule set consists of the following fields:

Sequence: Determines the order in which to process the rules.


Transaction Code: The code used to determine the statement line type.
Source Field: The interface table field that contains the data to be parsed.
Target Field: The statement line field that the data is to be parsed to.
Rule: Contains the syntax for determining the data within the source field to be parsed.
Overwrite: Used to control whether to overwrite existing data in a target field or skip parsing the
data.
B) Reconciliation Rules Sets
Bank statement reconciliation rule sets are a group of matching rules* and tolerance rules*. They
are assigned to a bank account and used to reconcile bank statement lines with transactions.
Steps:
Setup & maintenance Financials Cash & Bank statement All task  Manage bank
statement reconciliation rule sets  +  enter name  +  Attach matching rule and tolerance
rule created  Ok  Save & Close

*Refer below attached slides


.

1) Tolerance Rules: it enables you to specify date and amount tolerances that prevent or warn
you when reconciliation would be a breach of a defined tolerance.
Two types: 1) Date tolerance : are primarily used for checks that may be issued on one day and
not clear the bank until days or weeks later.
2) Amount tolerance: are most often used when reconciling foreign currency
transactions where there may be differences due to rounding or fluctuations in the conversion
rate. They can also be used if a bank includes a processing fee in the bank statement line amount.
Steps : Setup & maintenance Financials Cash & Bank statement All task Manage bank
statement reconciliation tolerance Rules Fill details Save & close
.

2) Reconciliation matching rules: help you match bank statement lines and system transactions to
minimize the need for manual intervention. After you assign the rule sets to the bank account, the
Auto reconciliation process picks up the reconciliation matching rules to achieve a higher match
rate.

Steps: Setup & maintenance Financials Cash & Bank statement All task  Manage bank
statement reconciliation matching rules  Fill details Save & close
Field details:
Matching type:
One to One A bank statement line is matched with a system transaction and reconciled against
each other
One to Many A bank statement line is reconciled against many system transactions
Many to One Many bank statement lines are grouped and reconciled against a system transaction
Many to Many Many statement lines are grouped and reconciled against many system transactions
Zero Amount Zero amount system transactions not reported in bank statements

Grouping Attributes: Used to group bank statement lines and system transactions based on the
matching type you select. The combination of the attributes you select also determine what you
can use as the matching criteria.
In Many to One matching, the grouping attributes are used to group bank statement lines. In One
to Many matching, the grouping attributes are used to group system transactions.
.

Statement Line Grouping System Transaction Grouping


Matching Type
Attributes Attributes
One to One Not applicable Not applicable
One to Many Not applicable Grouping attributes required
Many to One Grouping attributes required Not applicable
Many to Many Grouping attributes required Grouping attributes required
Zero Amount Not applicable Not applicable

Advanced Matching Criteria: Enables you to specify additional matching logic or filtering
conditions that must be true for the bank statement lines and system transactions to match
successfully.

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