Oracle Cash Management Setups - Defining Bank Transaction Codes

If you want to load electronic bank statements or use Cash Management's Auto Reconciliation feature, you must define, for each bank account, the transaction codes that your bank uses to identify different types of transactions on its statements. You should define a bank transaction code for each code that you expect to receive from your bank. Payment and Receipt codes may be defined more than once if they apply to transactions from multiple sources.

You can enter effective date range fields, Start Date and End Date, so that you can make a bank transaction code inactive. You can also delete codes that have not been used, in case you make a mistake in creating one.

N: - Setup-> Banks-> Bank Transaction Codes

To define a bank transaction code:

1. Navigate to the Bank Transaction Codes window.

2. In the Find Bank window, select the bank, whose codes you are defining. Alternatively, you can query the bank account number. The system displays the Bank Transaction Codes window, which includes bank account, bank information, and a region for entering transaction codes.

3. For each transaction code you are defining, select a transaction type from the list of values. The transaction type determines how Cash Management will match and account for transactions with that code.

Bank statement lines are coded to identify the transaction type the line represents. Since each bank might use a different set of transaction codes, you need to map each code a particular bank uses, to one of the following Cash Management transaction types.

You can select from the following list of values:

o Payment: Payments such as generated or recorded checks, payment batches, wire transfers, electronic funds transfers, or payroll checks.

o Receipt: Receipts such as received checks, remittance batches, direct debits, and bills of exchange.

o Miscellaneous payment: Payments not associated with supplier invoices, such as petty cash transactions directly posted to cost accounts or bank charges.

o Miscellaneous receipt: Receipts not associated with customer invoices, such as petty cash transactions directly posted to revenue accounts, such as interest received.

o Stopped: Stopped payments previously entered, generated, or cleared, such as callback of check. A stopped transaction type matches only to Voided or Stopped payments in Payables or Oracle Payroll.

o Rejected: Receipts rejected for reasons other than non-sufficient funds, such as an invalid bank account. A rejected transaction type matches only to reversed receipts in Receivables.

o NSF (Non-Sufficient Funds): Receipts rejected by the bank because the accounts on which they were drawn had non-sufficient funds. You can reverse these receipts by creating a standard reversal. Cash Management reopens the invoices you closed with the original receipt. When you match bank statement lines with transactions, an NSF transaction type only matches to reversed receipts in Receivables.

o Sweep In. Incoming funds transfer from an internal bank account. This bank transaction type identifies the originating bank account.

o Sweep Out. Outgoing funds transfer from an internal bank account. This bank transaction type identifies the receiving bank account.

4. Enter the code used by your bank.

5. Optionally enter a description of the transaction.

6. Enter start and end dates to determine when the bank transaction code is considered active.

7. Enter the number of float days that you want Cash Management to add to or subtract from the statement date to create an anticipated value date for automatic lockbox receipts.

8. Enter a Transaction Source for payment and receipt transactions. Choose Journal from the list of values to reconcile statement lines, with the assigned transaction code, to General Ledger journals. Choose Open Interface to reconcile statement lines to settlements in Oracle Treasury or external transactions in the Reconciliation Open Interface. Choose Payables Payments or Receivables Receipts to reconcile statement lines to transactions in Oracle Payables or Oracle Receivables. Choose Payroll Payments to reconcile statement lines to transactions in Oracle Payroll. Choose Cash Management to reconcile statement lines to cash flows in Oracle Cash Management.

9. Enter the Reconciliation Sequence number. If the same code with bank transaction type Payment or Receipt is entered more than once with different transaction sources this number is used by the AutoReconciliation program to determine the order in which to search the transaction sources for a matching transaction.

10. Optionally select a value for the Payroll Payment Format field to reconcile statement lines, with the assigned transaction code, to Payroll EFT payments. The Payroll Matching Order field is automatically populated based on the value selected in the Payroll Payment Format field. It is populated after a Payroll Payment Format has been selected. This field indicates the order in which you need to set up the format for the BANK_TRX_NUMBER in the bank statement mapping template.

11. If the transaction type is Miscellaneous Receipt or Miscellaneous Payment, use the Matching against field to determine the order of matching and the type of transactions to match.

Since the same transaction code may be used for matching against both miscellaneous transactions and/or correcting statement errors, you need to indicate, for miscellaneous payments and miscellaneous receipts, the transaction type to match. If you use a transaction code for both miscellaneous transactions and correcting statement errors, you can also specify the matching sequence. You can choose from the following values to indicate how to use this bank transaction code:

o Misc: Only match against miscellaneous transactions.

o Stmt: Identify the statement line as a correcting entry. The statement line will match against existing statement lines. The netted amount of these lines is used to match to sub ledger transactions.

o Misc, Stmt: First try to match against miscellaneous transactions, if there is no match, and then try to match against statement lines (corrections).

o Stmt, Misc: First try to match against statement lines (corrections), if there is no match, and then try to match against miscellaneous transactions.

12. Choose the correction method your bank uses when correcting bank errors: Reversal, Adjustment, or Both.

This field is only applicable for those Miscellaneous Receipt or Miscellaneous Payment transaction codes that may be used to match to correction statement lines.

13. Choose whether to create transactions for any miscellaneous payments and miscellaneous receipts reported on the bank statement when no transaction number is provided.

14. If you selected the Create option in the previous field, specify the Receivables Activity type and payment method for any miscellaneous transactions (receipts or payments) you create from within Cash Management.

15. Define each additional bank transaction code, following the previous steps.

16. Save your work.