CEU+BAR Cash+Application+Workshop v1%5B1%5D

7/29/2019 CEU+BAR Cash+Application+Workshop v1%5B1%5D

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OTCCA300_Cash Applications

Cash ApplicationAccounts Receivables


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Agenda

Cash Application Overview

Cash Application Process - Demos


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Accounts Receivable Cash Application at McCain

Cash Application occurs:

Receive and applycash (Checks and

EFTs)

Post and matchincoming payments

After the invoicing process is completed

At the time payment is received from the customer

CashApplication

Parallel to the Accounts Receivable Account Analysis

and Collections process


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Accounts Receivable Cash Application at McCain (contd)

Incoming payments from customers can be accepted in the

following formats:

Checks

Via Autocash Lockbox

Manually (Lockbox or live checks)

EFTs and Wire Transfers Via Autocash when supported by EDI

Manually


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SAP Autocash Lockbox Process

SAP Autocash Lockboxes are setup to:

Receive payments

Deposit funds

Eliminate manual cash application (data entry) with

electronic account receivable input

Process large numbers of transactions every day


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SAP Autocash Lockbox Process (contd)

SAP Autocash Overview:

Banks receive the payments and deposit the checks

into McCains bank account.

Bank codes the invoice number, amount, check

number, check date, and external reason code into a

bank file (BAI2 format).

The BAI2 file is transmitted by the bank to McCain

(SAP).

SAP uploads BAI2 file from the bank for pre-

processing.

SAPs lockbox import program posts a general ledger

entry to update the companys cash position and

cash clearing accounts. Another entry is made to

clear items, if applicable, on customer accounts. Manual application of the customer remittance note

will be applied where necessary.


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The SAP Lockbox import program is configured to post

an entry to cash for the lockbox bank and to the cashclearing account.

When payment advice information is cleared against

customer open items, the open items and the credit

to the customer account are cleared.




It is expected that McCain will be able to use the lockboxes to

transmit the customer remittance data to SAP so that it can beauto-applied.

Customer

Payment via

Check

Bank

Lockbox

Information

Keyed by

Bank in BAI2

Format

SAP - Import

Lockbox File

(FLB2)

SAP Post

Processing of

Exceptions

(FLB1)

There will be an effort to harmonize bank instructions for

keying files for all business units so business rules can be

applied on similar sets of data.



Wire Transfers

Wire Transfers and/or EFTs that are supported by an

EDI Remittance advice are available for autocashprocessing.

Any payments received via EFT and/or wire transfer

that are not supported via EDI are applied manually

to the respective customer accounts.

Payment Remittance details can be sent to

McCain via the following options:

Email

Fax

Mail

EDI



Manual Cash Application

The manual cash process is used in the following

situations:

SAP cannot fully post a check through auto-cash

processing, and it stays in the SAP post-processing

screen.

Wires are received at a bank and are notified to

McCain via NON-EDI remittance advice.

All live checks received at a NA McCain office are

forwarded to the bank lockbox. Once monies are

deposited, the payment is applied to the customers

account.

All Checks in the US will be applied manually.



Manual Cash Application (contd)

There are two transactions that can process manual cash entries.

This transaction manually applies cash for allincoming payment types from either hard copychecks or wire transfers.

F-28

This transaction is used when the SAP autocashlockbox program cannot post a check to theaccount.

FLB1



Manual Cash Application (contd)

Another method for clearing a customer account is through assigning

debits to credits.

F-32 is used to assign debits to credits.

Is used to:

Assign Debits to Credits Clear Open Items on a CustomerAccount

Split Residuals

Transfer posting (i.e. move a residual to another customer)

F-32

I t ti ith D d ti M t P



Integration with Deductions Management Process:Payment Differences

A payment difference normally occurs during the clearing

of an open item.

The payment difference can be:

Within the tolerance amount

Too high and outside the tolerance limits

I t ti ith D d ti M t P



Integration with Deductions Management Process:Reason Codes

Reason codes are used to describe the reason for

payment differences.

Reason codes can be assigned to:

Trade Deductions

Non-Trade Deductions

Unknown Deductions Advanced Payments

Payments on Account

Legacy Trade Claim

Over Credits

Over Payments



Customer Payments with Cash Discounts

McCain sells products on cash discount terms, where the

customer can deduct a stated percentage of the invoice ifthey pay within the stated number of days.

Triggers for this process include:

. Check Direct Debit

Wire TransferCheck sent to

McCain

Customer Payment via Check

Customer Payment via EFT or Wire Transfer

Customer Payment - Check Sent to McCain Facility

Customer Payment terms include cash discount



Manual Cash Application Process

Manual Cash Application processes include the

following activities:

Apply payments manually by clearing existing

open items

Apply payments manually by placing the

remittance on account

Clear existing open items with offsetting debits

and credits

Clear existing items when customer payments

do not match billing documents and are outside

tolerance

Real-time payment data after rework of

payment is processed



Agenda

Cash Application Overview

Cash Application Process - Demos



Instructor Demonstration

Post Incoming Payment Manually Payment in Full - F-28

Scenario:

A customer has sent a payment by check with a list of invoices he is

paying. The payment check is lying in the SAP post-processing screen as

SAP could not post the check through auto-cash processing. You need to

post this payment manually in full.


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Post Incoming Payment Short Pay - F-28

Scenario:

A customer has sent a payment to settle two invoices. The remittance

contains two deductions. One Deduction is created with reference to

one of the invoices and the other is a deduction without reference.


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Post Unapplied Cash

Scenario:

A payment is received but we are unable to determine the Customer

who sent the payment.

In this situation we post the Payment to the Unapplied Cash G/L accountand then undertake an investigation to determine the payers identity.

This same process is used for posting Farmer A/R loan repayments (non-

AR Cash).


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Cash in Advance (No Open Items to Pay)

Scenario:

A payment is received from a Cash In Advance customer. Post the

payment to the customers account.


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Single Payment for Multiple Invoices on Multiple Customer #s

Scenario:

A corporate entity is paying invoices belonging to its subsidiaries. This

single payment will clear multiple invoices while also creating multiple

residuals on those customer accounts.

Use Other Accounts selection

Use Distribute Difference to post residuals to multiple customer

accounts


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Apply Debits to Credits and Clear Items - F-32

Scenario:

After posting payments (either through Auto Cash or Manually) it may

be necessary for the Cash Applicator to assign a debit to a credit.

This transaction assigns debits to credits on the Customer AR.


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Post Non-AR Cash

Scenario:

We have received payment for a non-AR Trade related matter (i.e. Jury

Duty, Employee returning Cash Advance, etc.)


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Balance the Days Cash Posting

Scenario:

Use FBL3N to reconcile the Days payments against the Banks

statement.


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Questions?


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Display Payment Advice Created via EDI FBE3

Scenario:

You want to view the payment advice created through EDI.


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Post Incoming Payment with Payment Advice - F-28

Scenario:

A customer has sent a wire transfer and the corresponding remittance

advice is sent via EDI resulting in creation of a payment advice. You need

to post this payment manually with the payment advice.


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Lockbox Post-Processing (FLB1)

Scenario:

When the Lockbox file is imported into SAP based on the information

provided by the customer, the checks will be in applied, partially

applied or unprocessed status.

FLB1 is used for partially applied and unprocessed payments.


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Lockbox Reporting FOEBL1

Scenario:

This transaction is used to generate a report with the lockbox activity

for a given day.

i


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Course Review

Cash Applications Manual Cash Applications

Assigning Debits to Credits

Auto Cash

Posting Cash on behalf of another McCain Company

In this course you have learned about:

N d H l ?


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Need Help?

1. Help yourself first

One McCain Help in SAP One McCain BPP Portal

2. Ask your local Super-User

Super-user contact Super-user contact

Super-user contact

Super-user contact

http://namf216232.mccain.com/gm/workplace

R i h i l i R d d AMS


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Reporting technical issues Remedy and AMS

Use the Remedy portal

http://serviceit.mccain.com Supported by AMS

Expect a call-back from AMS!

Super-Users submit tickets

for SAP incidents

End-Users submit tickets for

issues NOT related to SAP

C A di


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Course Appendix

Course Appendix

NOTE:

The following slides are optional

they may be reviewed on anad-hoc basis, or printed and posted on the classroom wall for

reference during the training session.

N T i C h A li ti


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New Terms in Cash Applications

Term Description

Customer Ledger The customers A/R account that can be viewed for open items only,cleared and closed items only, or both

Line Item An individual item on the customer ledger, such as an Invoice orPayment

Note to Payee The text information provided with each Auto Cash remittance,describing the source and purpose of the payment

Clearing Document An accounting document that clears/closes one or more offsettingdocuments. In A/R, clearing documents are usually payments, but can

be other types as well

Posting Key A two-digit numeric key that determines the way line items are posted;this key determines several factors including account type, type of

posting (debit/credit), and layout of the screens

N T i C h A li ti ( td)


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New Terms in Cash Applications (contd)

Term Description

Tolerance The amount that payments may differ from the open amounts.Differences within tolerance are written off automatically in Auto Cash

and Manual Cash application

Short Payment A short payment may be within, or out of, tolerance. Short paymentsout of tolerance are not automatically cleared. A short payment may be

manually processed by the user as a partial payment, a residualpayment, or a payment on account

Partial Payment A partial payment is an open credit line item on the customer ledgerthat is associated with an open Invoice

Residual Payment A residual payment is the balance of an open Invoice remaining afterthe original Invoice is partially cleared by a short payment

Payment on Account An open credit or debit amount may be posted to the customer ledgeras a new line item

S li t th P


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Suppliers to the Process

Direct customer of McCain. This can be adistributor, a re-distribution center, a retailer, acentral customer warehouse or an operator.The payment is made successfully

Customers

Bank sends electronic file to SAP with therelevant check information

Bank

SAP sends the direct debit payment informationto the bankSAP

Inputs to the Process


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Inputs to the Process

Inputs

Customer Payment (Check) Customer sends the check to the bank.

If the check is directly sent to the McCain facility, McCain sends the check

to the bank

Electronic File from bank

for checks received

After the customer sends the check to the bank, the bank inputs the

relevant information in electronic file format that will be uploaded into

SAP for further processing

Batch file from bank Once the funds are transferred into the McCain bank account, the bank

sends a batch file which will be validated against the payments that have

been processed as a part of lockbox processing

Customer Payment (Wire

Transfer)

Customer sends the payment via wire transfer

Remittance Advice From

Customer

Customer sends remittance advice to McCain in regards to the wire

transfer madeCustomer Payment (Direct

Debit)

Customer authorizes McCain to withdraw funds from their bank account

Direct debit file from SAP After the payment program is executed, SAP will generate a file with

customers payment and bank information which will be sent to the bank

Outputs


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Outputs

Outputs

Clear customer invoice Customer open items/invoices cleared as a result of applying thepayments

Residual items created Customers short payment or overpayment result in creation ofresidual items

SAP posting log After the open items/invoices are cleared, a posting log is

generated in SAP, which will be validated with the file receivedfrom bank

Payment by Check Business Process Flow


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Payment by Check - Business Process Flow

Direct Debit Process Business Process Flow


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Direct Debit Process - Business Process Flow

Wire Transfer Business Process Flow


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Wire Transfer - Business Process Flow

Date post:	04-Apr-2018
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