Cash Management – Bank Reconciliation

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Contents

1 Introduction ......................................................................................................................
................................ ...................... 3
1.1 Context................................
......................................................................................................................
...................... 3
1.2 About This Document ...............................................................................................
............................... 3
2 Overview of the process ................................................................................................
................................. 5
2.1 Inputs and triggers ................................................................................................
.................................... 5
2.2 Process step details................................................................................................
.................................. 5
3 Document Control ................................................................................................
................................ .......................................... 18
3.1 Revision History ................................................................................................
...................................... 18
3.2 Approvals ................................................................................................
................................ ................................................ 18
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1 Introduction

1.1 Context

This is a work instruction for Bank Reconciliation process which is part of the Cash Management
function.. The objective of this process is to ensure all cash movements are recorded accurately.

1.2 About This Document

1.2.1 Document Purpose

This document is a work instruction
n.. It should be used as reference guide and as a support but not a
substitute for training.

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

This

1.2.2 Intended Audience

This document is intended to be read by:

• The Finance Team

1.2.3 Roles and Responsibilities

Role Responsibilities

• Obtain bank statements from online banking on a weekly basis

basis.
Export
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.

Cash Management
Team 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,

recon identify whether the upload is done via
a file or manually.

o If manual, process
cess manual bank statement in SAP

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

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import file with parameters “Post Immediately” in SAP

• SAP will match bank transactions against items posted in clearing

accounts where it can. Manually match off remaining transactions
where possible in SAP

• Correct error / missing postings in payment; send confirmation

Cash Collection (CC)
email

Accounts Payable • Correct error / missing postings in receipt;; send confirmation email
(AP)

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

• Account Payable need to complete payment postings.

• Credit Control team needs to complete receipt postings.
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2 Overview of the process

2.1 Inputs and triggers

The process starts with Cash Management Team obtaining bank statements from online
banking as weekly activity.

2.2 Process step details

2.2.1 Obtain Statement

1. Cash Management Team to obtain bank statements from online banking on weekly basis
basis.
And, export
xport bank statement to spreadsheet (MS Excel) and save in bank statement
folder.

2. Classify reconciliation type into any one of the below categories

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

balance,
refer to section 2.2.5

b. Automatic; check file upload type and classify it into manual or automatic
i. Manual; copy
opy and paste bank statement from spreadsheet. This process
continues in SAP,
SAP refer to section 2.2.2 for further instructions.
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ii. Automatic; resave

esave bank statement as MT940 file format. Then, Import file
with parameters “Post Immediately”. This process continues in SAP,
SAP refer
to section 2.2.3 for further instructions.

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

1. Use transaction code “FF67

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

2. “Specification” screen is displayed. (Screen appears when

hen you process for first time only
else goes to next screen)
screen):

Enter the following fields in “Specification” screen:

• Tick on “Import
Import advices”
advices
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• Start variant : select “SAP01” from the drop-down menu (Memo record entry section)

• Process type : Select “4” from drop-down menu (Further processing section)

• Press Enter or click on

3. “Process
Process Manual Bank Statement”
Statement screen is displayed:

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

• Bank Key (Sort

Sort Code)
Code

• Bank Account (Account

Account #)
#

• Currency (as applicable)

• Statement Number (as applicable)

Please note:: click on Overview button to get the last statement #

• Statement Date : date

ate on the bank statement

On the same screen go to “Control”

“ section enter the following fields:
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• Opening Balance : previous day’s closing balance

• Closing Balance : from

rom the bank statement

• Posting Date : week ending date

• Press Enter

4. The below “Process

Process Manual Bank Statement”
Statement screen is displayed:

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

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

• Value date : statement date

• Amount : value
alue on the statement from the customer

• Doc. No. : customer

ustomer invoice #.

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

5. On the “Process
Process Manual Bank Statement”
Statement screen, click on “Bank Statement” menu and
click on “Save” as displayed below:
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6. On the “Process
Process Manual Bank Statement”
Statement screen, click on “Bank Statement” menu, select
“Post” and click on “Individual statement”
s as displayed below:

7. “Update Account Statement/

tatement/Check Deposit Transaction” screen iss displayed
displayed:

• The amount posted

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

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

screen.
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2.2.3 Import
mport Bank Statement File

1. Use transaction code “FF_5

FF_5” in command field of SAP Easy Access screen and press
Enter:
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2. “Bank
Bank Statement Various Formats (Swift, Multicash, BAI..,)”
BAI..,) screen is displayed:

Enter the following fields in above screen:

File Specification section:

• Tick Import data

• Electronic Bank Statement format

format: select “SWIFT
SWIFT MT940 with field structure
structure” from
the drop-down
down menu

• Statement file: click on to get the path of Imported

ted Bank statement File location.

• Tick on Work station upload

Posting parameters section:

• Select option “Post

Post Immediately
Immediately”
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• Tick on “Assign
Assign value date”
date

Output Control section:

• Tick on Print bank statement

• Tick on Print Posting log

• Tick on Print statics

• Click on Execute

Bank Statement Various Formats (Swift, Multicash, BAI..,)”

3. “Bank BAI..,) screen is displayed:

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

• Check closing balance agrees to statement closing balance.

• Once the Bank

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
by FEBAN.

2.2.4 Manually Match Offf Transactions

1. Use transaction code “FEBAN
FEBAN” in command field of SAP Easyy Access screen and press
Enter:
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2. “Selection
Selection of bank statements by banks and Account Nos.”
Nos.” screen is displayed:

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

• Company Code

• House Bank

• Account ID
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• Press Execute button

3. “Edit Bank Statement”” screen is displayed:

Enter the following fields in “Edit Bank Statement” screen

• The transactions # posted successfully is in green.

• The transactions # that weren’t automatically matched in red.

These will have to be processed manually.

4. To process / post manually on the ““Edit Bank Statement” screen, select the statement in
red, click on “Statement Items” menu, click on “Post” as displayed below:
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5. “Post with Clearing Select

elect open items”
items screen is displayed:

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

• Account (incoming
incoming / outgoing as applicable)
applicable

• Click on “Process Open Items”

6. “Post
Post with Clearing Process open items”
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

clicking on the
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 displays a transaction # not
posted automatically before but manually posted successfully after:
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2.2.5 Complete Bank

nk Reconciliation
1. Cash Management Team to compare bank statement balance to corresponding bank GL
balance.

2. If bank statement balance and corresponding bank GL balance match, then Cash
Management Team update Excel rec.
rec Financial Accountant then reviews and approves it.
The process ends.

3. If bank statement balance and ccorresponding bank GL balance don’t

n’t match, then Cash
Management Team create in Excel a reconciliation between bank statement balance and
GL balance to identify errors / missing postings.

4. Cash Management Team classify each identified error / missing posting into any one of
the below two categories and send emails to respective team for corrections.

a. Payment; Account Payable team to correct error / missing posting; send

confirmation email to Cash Management Team

b. Receipt; Cash Collection team to correct error / missing posting; send

confirmation email to Cash Management Team`

5. After receiving confirmation from Cash Collection / Account Payable teams that error /
missing posting has been corrected, the Cash Management Team check the
reconciliation type and classify it into any one of the below two categories.

a. Manual; Cash Management Team to continue process with Section 2.2.5

b. Automatic; Cash Management Team to continue process with section 2.2.4

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3 Document Control

3.1 Revision History

Version Date Author Description

0.1

3.2 Approvals

The following roles relate to the most recent version of this document as listed in the Revision
History above.
Name Title Signature Date

Emily Burlington Process Owner

Agnes Muszynska Process Sponsor

Mike Pollard Head of Finance