Lock Box Setting

What are the steps for lock box setting?

Lock Box setting:
There are three lockbox settings:
 Defining lockboxes
 Defining control parameters
 Defining posting data
Define Lockboxes:
Financial Accounting -> General Ledger Accounting -> Bank-Related Accounting ->
Bank Accounts -> Define Lockbox Accounts at House Banks
Transaction: OB10
In this transaction, you define your lockbox accounts at the house banks. Thus, on the
outgoing invoice you can inform your customer of the lockbox to which payment is to be
made. By specifying this, you can optimize the payment transactions.
To configure the lockboxes first specify the lockbox links (company code; key of the
lockbox to which the customer is to pay; house bank ID; lockbox number at your house
bank). Second enter a remit to address that will appear on the customer invoice.
Define Control Parameters:
SPRO -> Treasury -> Cash Management > Business Transactions -> Lockbox -> Define
Control Parameters
Transaction: OBAY
The top "Record format' settings are unnecessary for BAI2 format, and should be left
blank.
Procedure - LOCKBOX (currently the only supported procedure in standard system)
Record Format - BAI or BAI2
Record Format Parameters: (Required for BAI Only)
Document # length - length of the document # used to locate the open item
Number of document numbers in record type 6 - maximum # of documents in detail
record
Number of document numbers in record type 4 - maximum # of documents in overflow
record
Posting Parameters:
G/L Account Postings: Identifies whether G/L Posting is created.
G/L Account Posting Type: (1) = Posting / Check or (2) Posting / Lockbox
Incoming Customer Payments: Identifies whether to post to customer accounts also.
Insert Bank Details: Create batch session to update customer record with new bank
details.
ADDBNKDETAIL – creates batch input session that if executed will update the MICR
number information on customer master records.
Define Posting Data:
Treasury -> Cash Management -> Business Transactions -> Lockbox -> Define Posting
Data
Transaction: OBAX
The lockbox is defined with respect to a 'Destination' and 'Origin" identifier combination.
Each lockbox must have its own unique Destination and Origin combination, and also
must be defined for a single company code in configuration. The bank must transmit the
file with the Destination, Origin and Lockbox identifiers in the exact format as they have
been created in SAP lockbox configuration. Otherwise, the file will be improperly read
by the lockbox and posting will not properly occur.
General Data
Company Code - enter the company code for which the lockbox transmission applies
Bank Account Number - enter the bank (g/l) account for bank account posting
Bank (Payment) Clearing Account - enter the lockbox clearing account
Posting Parameters
Bank Posting Doc Type - enter the document type for bank account postings (e.g. SA)
Cust. Posting Doc Type - enter the document type for customer (A/R) postings (e.g. DZ)
Posting Key: debit G/L - enter the PK related to g/l postings (i.e. 40)
Posting Key: credit G/L - enter the PK related to g/l postings (i.e. 50)
Posting Key: credit Customer - enter the PK related to customer postings (i.e. 15)
Posting Key: debit Customer - enter the PK related to posting residual items (i.e. 06)
Execution of Lockbox Program
The lockbox program can be accessed using transaction FLB2 or program RFEBLB00.
In the PRD environment a variant exists for each lockbox file. For test purposes it is
easiest to copy the PRD variants, changing only the location of the lockbox file.
However, Before executing the lockbox program please confirm that each of the fields in
the above slide is completed as indicated.
Import into Bank Data Storage – this field should be selected so the lockbox file will be
imported into the bank storage data. This ensures that the same lockbox file cannot be
accidentally imported more than once (based on Origin, Destination, Date and Time
values).
PC Upload – this field should be selected if the lockbox file resides on the users PC
rather than in a UNIX directory.
Lockbox File – enter the location of the lockbox file in this field. The location may be
either on the users PC or in the UNIX directory.
Procedure – this field should always be populated with LOCKBOX.
Input Record Format – this field should always be populated with BAI2.
Invoice Numbers – this field should always be populated with a '1'. This field offers four
standard open item identification algorithms.
1 – match on document number (BELNR)
2 – match on reference number (XBLNR)
3 – match on document number first, if not found then on reference number
4 – match on reference number first, if not found then on document number
Enhanced Invoice No. Check – this field should not be selected. If selected it allows
postings to be made across customer worklists.
Algorithm: checks with advice and Algorithm: checks without advice – these fields
should be populated with 001. These fields determine whether cash that does not find an
appropriate open item should be posted as 'On Account cash', or be applied against oldest
open items on the account.
Account assignment fields – these fields should be left blank. The values entered in the
fields are defaulted on the postings created by the lockbox program.
Print Control – this field should be selected so the lockbox reports will be output.

Lock Box Configuration

What are the steps for lock box configuration?
Lock Box Config:
Master Data Settings
General Ledger Accounts:
XXXXX has three lockbox clearing accounts:
Company Code 1000 – G/L account 1201005, First Union Bank
Company Code 1000 – G/L account 1201006, PNC, Bank
Company Code 2000 – G/L account 1201008, Wachovia, Bank
General Ledger Account Master Record Settings:
Cash G/L accounts exist for each bank. For example account 1105012 is for PNC Bank.
If you look at the G/L account master record for this account (Accounting -> Financial
Accounting -> General Ledger -> General Ledger -> Master Records -> Display,
transaction FS03) you will notice the 'Relevant to Cash Flow' field is checked.
Customer Master Record Settings:
In order for the lockbox program to identify a customer the payment MICR must be
populated on the customer master record in the General Data: Payment Transactions
screen. The remit-to lockbox assignment must also be specified. Regarding the tolerance
group assignment, XXXXX only has one configured that is a blank customer tolerance.
By defining a blank tolerance group the tolerance group field may remain blank on each
customer master record but the tolerance settings are applicable. The tolerance
configuration will be reviewed in the next few slides. Finally an alternative payer should
be entered on a customer master record if another customer account will pay the bills for
the customer.
Lockbox Assignment on Customer Master Lockboxes are assigned on customer master
records and determine which remit to address is printed on the customer's invoices
Tolerance Settings
When an incoming cash payment does not exactly pay the referenced open item(s), the
system will create a residual item back on the customer's account or write-off the
difference if tolerance limits are configured.
In SAP tolerance limits are set for users and customer accounts with the stricter limits
applying.
SPRO -> Financial Accounting -> Accounts Receivable and Accounts Payable ->
Business Transactions -> Manual Payment Receipt -> Define Tolerance Groups for
Employees
Transaction: OBA4
This transaction is used to create tolerance groups for users. The tolerances are defined by
company code and at a minimum there must be one assigned to each company code
otherwise no postings can occur in the company code.
Company Code
Currency
Amount per Document – The maximum amount that can be posted in an accounting
document.
Amount per Open Item Account Item – the maximum amount that can be posted to a
customer or vendor account.
Cash Discount per Line Item – the maximum cash discount percentage that can be
applied to a line item.
Amount, Percent, Cash Discnt Adj. To (Both Revenue and Expense) – the amount field
contains the maximum amount of a customer overpayment (Revenue)/underpayment
(Expense). The percent field is the maximum percentage rate difference posted by the
system. The lower limit between the amount and percentage applies.
Configuration: Define Tolerances (Customers/Vendors)
SPRO -> Financial Accounting -> Accounts Receivable and Accounts Payable ->
Business Transactions -> Incoming Payments -> Define Tolerances (Customers/Vendors)
OR
SPRO -> Financial Accounting -> Accounts Receivable and Accounts Payable ->
Business Transactions -> Outgoing Payments -> Manual Outgoing Payments ->
Overpayment/Underpayment ->Define Tolerances (Customers/Vendors)
Transaction: OBA3
This transaction is used to configure customer tolerances. To change a tolerance select the
company code then press the Details icon.
Configuration: Define Reason Codes
Transaction OBBE is used to configure reason codes by company code. All new reason
codes must be configured in each company code.
Configuration: Define Text : Transaction OB56 is used to configure the text that appears
on a line item based on the reason code entered.
Configuration: Define Accounts for Overpayments/Underpayments : Transaction OBXL
is part of the automatic account assignment. The GL account for
overpayments/underpayments is maintained here.
Configuration: Define Posting Keys : Transaction OB41 is used to configure posting
keys. Posting keys are two-digit numeric keys that control the entry of document line
items. Specifically it controls the account type, debit/credit posting, and layout of entry
screens.