Oracle Cash Management

Overview
Overview

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 1 of 20 Rev 1
Oracle Cash Management Overview
System References

Distribution
Job Title*

Ownership
The Job Title [list@YourCompany.com?Subject=EDUxxxxx] is responsible for ensuring that this
document is necessary and that it reflects actual practice.

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 2 of 20 Rev 1
Oracle Cash Management Overview

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 3 of 20 Rev 1
Objectives

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 4 of 20 Rev 1
Agenda

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 5 of 20 Rev 1
Overview

Overview
Oracle Cash Management is an enterprise cash management solution that helps you manage
your liquidity and cash position.
Manage and control your cash cycle: track closing ledger and available balances as well
as month-to-date and year-to-date averages.
Create all bank accounts centrally
Transfer funds funds between bank accounts manually or automatically.
Reconcile bank accounts
Use cash pools to optimize funds
Forecast your cash needs

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 6 of 20 Rev 1
Cash Management Integration

Cash Management Integration

Cash Management integrates with:
Banks
Receivables: Receipts are available to Cash Management for reconciliation and clearing.
Miscellaneous receipts can be created in Receivables from Cash Management to record
bank charges or interest.
Payables: Payments are available to Cash Management for reconciliation and clearing.
General Ledger: Journal entries and cash account balances are available to Cash
Management for reconciliation. Journal entries are created for bank account transfers and
bank statement cash flows using Subledger Accounting and transferred to GL.
Payroll
Treasury
Cash Management Cash flow: Cash flows generated from Bank Account Transfers and
Bank Statement Cashflow programs are available for clearing and reconciliation.
Open Interfaces

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 7 of 20 Rev 1
Overview of Bank Account Model

Overview of Bank Account Model

In previous releases, AP owned banks, bank branches, and bank accounts. Such bank accounts
could also be used by AR. Payroll, and Treasury, however, had their own bank account models.
In Release 12, in the new model shown on your screen, Banks and Bank Branches are created
as Trading Community Architecture parties. The bank accounts are associated with Bank
Branches but reside within the Cash Management application. During the bank account
creation, you are able to define in which applications this bank account can be used.

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 8 of 20 Rev 1
Setting Up for Reconciliation

Setting Up for Reconciliation

Before you set up Cash Management, you should set up Oracle Application responsibilities and
users for the implementation.
Cash Management provides three responsibilities: Cash Management, Bank Reconciliation,
and Cash Forecasting.
It uses data from Oracle General Ledger, Oracle Payables, Oracle Payroll Oracle
Receivables and Oracle Treasury for bank statements reconciliation;
It uses information from Oracle General Ledger, Oracle Order Management, Oracle
Payables, Oracle Payroll, Oracle Purchasing, Oracle Projects, Oracle Sales, Oracle
Treasury, and Oracle Receivables for cash forecasting.
You must perform certain setup steps in these applications before you can use Cash
Management with them.

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 9 of 20 Rev 1
Reconciliation

Reconciliation
Enter the detailed bank information manually or electronically.
Reconcile these information with your system transactions manually or automatically.
While reconciling, you can create miscellaneous transactions for bank-originated entries and
manually enter payments and receipts.
You can manually or automatically clear payments, receipts, open interface and miscellaneous
transactions before reconciliation to maintain current cash account balances.
After reconciliation, review the Bank Statement Detail, Bank Statement Summary, and Bank
Statement by Number Reports.
You can post the accounting entries to your general ledger. You can reconcile your general
ledger cash account balance to your bank account balance in Cash Management by printing the
GL Reconciliation Report.

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 10 of 20 Rev 1
Reconciliation: Bank Statement Information

Reconciliation: Bank Statements

Managing Bank Statement Information
Oracle Cash Management maintains bank statement data that you want to reconcile. You use
the Cash Management Bank Statement Open Interface to load bank statement data or enter and
update them manually.
Each bank statement consists of one bank statement header and multiple bank statement lines.
Each bank statement line can refer to one or more payments, receipts, open interface and
miscellaneous transactions, or journal entry. A bank statement lines status can be Reconciled,
Unreconciled, Error, and External.
You can manage bank errors by manually or automatically reconciling them. You can reconcile
by matching a bank statement line with a Payables or Payroll payment, Receivables receipt,
miscellaneous transaction, open interface transaction, Treasury settlement, or GL journal entry.
You can also clear the matched transactions. Bank statement lines are coded to identify the
transaction type represented by the line. You need to map each code used.

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 11 of 20 Rev 1
Reconciliation: Integration

Reconciliation: Integration
Oracle Cash Management shares functionality with Receivables, Payables, Payroll, Treasury,
General Ledger, and other external systems.

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 12 of 20 Rev 1
Reconciliation: Oracle Receivables and Payables

Reconciliation: Oracle Receivables and Payables

You can reconcile payments you created in Payables and receipts you entered in Receivables
against your bank statements.
When you reconcile Payables payments in Cash Management, the payments are first matched
to bank statement lines and then cleared. You can also manually clear the payments prior to
reconciliation. After clearing or reconciling your payments, you can create accounting entries
for the Cash, Cash Clearing, Bank Charges, Bank Errors, Realized Gain and Realized Loss
accounts that you specified in the Oracle Payables Bank Accounts window and the Payment
Documents window. You then transfer the accounting entries to your general ledger.
When you reconcile receipts with Cash Management, accounting entries are automatically
created in the Cash, Remittance, Short-term Debts, and Interest Earned accounts, as applicable
to the reconciliation transaction. Cash Management uses the accounts you defined in the Banks
window and the Receipt Classes window (Payment Methods region) in Receivables. You post
the accounting entries resulting from Cash Management receipt reconciliation to General
Ledger from Receivables.

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 13 of 20 Rev 1
Reconciliation: Oracle Payroll, Treasury, and General Ledger

Reconciliation: Oracle Payroll, Treasury, and General Ledger

You can reconcile manual and EFT payments from Oracle Payroll and journal entries from
General Ledger against your bank statements.
Using the Bank Account Security Access profile option, you can grant access to the bank
account information at three levels: All, Internal, and Payroll.
You can reconcile third party payments such as child support payments using the same
matching criteria as payroll payments.
Voided payments on the bank statement lines will be marked with an error message that
identifies the payments as voided.
Payment discrepancies are not automatically reconciled, but marked with an error
message showing that the transaction amount is different from the payment amount.
You can also reconcile the following from Oracle Treasury: Settlements from Oracle Treasury
as open interface transactions, shared bank accounts, and bank account balances..
You can load, import, and reconcile bank statements from bank accounts shared by
Oracle Treasury and Oracle Cash Management.
When you import bank statements from a shared bank account, Cash Management uses
the balance provided by your bank to update the bank account balances in Treasury.
Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 14 of 20 Rev 1
Cash Forecasting

Cash Forecasting
Cash Forecasting is a planning tool for anticipating business cash inflow and outflow so that
you can protect your cash needs and evaluate your liquidity position.

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 15 of 20 Rev 1
Cash Forecasting (continued)

Cash Forecasting (continued)

Cash inflow data is accessible for forecasting in Oracle Cash Management from Receivables,
Order Management, Sales, General Ledger, and Treasury.
Cash outflow data comes from Payables, Purchasing, Payroll, General Ledger, and Treasury.
Cash flow information also comes from Projects and other Oracle Applications. You can
include cash flows from external systems using the External Cashflow Open Interface.

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 16 of 20 Rev 1
Cash Positioning

Cash Positioning
Cash Positioning is a planning tool for viewing your daily cash position by currency or bank
account to protect your cash needs and evaluate your liquidity position. The daily cash
positions are based on actual cash flows from various Oracle applications. You can generate a
daily cash position from a single or multiple currencies, bank accounts, and legal entities.

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 17 of 20 Rev 1
Cash Pools

Cash Pools
Cash pooling is a Cash Management technique for optimizing bank account balances at one or
several banks. It is usually performed daily, by transaction, or by total net end-of-day balances.
If your cash position includes cash pools, generate a cash leveling proposal. The cash leveling
proposal is calculated online based on the sub account target balances and transfer amount
calculation rules.
For notional cash pools and physical cash pools with bank initiated sweeps, use the cash
leveling proposal to approximate the projected closing balance of the concentration account, so
that the investment or funding decisions could be made from the concentration account based
on the projection.
For physical cash pools that do not have bank initiated sweeps, generate Intercompany Funding
Transactions and/or Inter-Account transfers from the cash leveling proposal. These transfers
can then be included in the payment file and sent to the bank through Oracle Treasury.

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 18 of 20 Rev 1
Oracle Cash Management Reports and Programs

Oracle Cash Management Reports and Programs

Refer to Practice Create a New User [LAB3F67Y]

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 19 of 20 Rev 1
Summary

Copyright 2007, Oracle. All rights reserved.

Oracle Cash Management Overview 346165046.doc

Effective mm/dd/yy Page 20 of 20 Rev 1