Cash Management Setup in Oracle R12

 Setting up Cash Management in Oracle R12 involves configuring various components that manage and reconcile bank statements, cash flows, and funds transfers. Below is a step-by-step guide for setting up Cash Management:

1. Define System Parameters

  • Navigation: Cash Management → Setup → System → System Parameters
  • Steps:
    1. Define global parameters like currency, calendar, and accounting options.
    2. Set up the default cash management ledger and specify the tolerance limits for bank reconciliation.

2. Define Banks, Bank Branches, and Bank Accounts

  • Navigation: Cash Management → Setup → Banks → Banks, Branches, and Bank Accounts
  • Steps:
    1. Define your organization's banks and their respective branches.
    2. Create and set up bank accounts, including account numbers, currencies, and associated ledgers.
    3. Assign bank accounts to the appropriate operating units and cash management responsibilities.

3. Define Bank Account Access

  • Navigation: Cash Management → Setup → Banks → Bank Account Access
  • Steps:
    1. Assign bank account access to users or responsibilities.
    2. Specify the level of access (View, Use, Maintain) for each user or responsibility.

4. Define Cash Management Security Profiles

  • Navigation: Cash Management → Setup → Security → Security Profiles
  • Steps:
    1. Define security profiles to control access to bank accounts and cash management functions.
    2. Assign security profiles to users or responsibilities.

5. Define Payment Methods

  • Navigation: Cash Management → Setup → Banks → Payment Methods
  • Steps:
    1. Set up payment methods like check, electronic, wire transfer, or manual.
    2. Link payment methods to bank accounts for processing payments.

6. Define Receipt Methods

  • Navigation: Cash Management → Setup → Banks → Receipt Methods
  • Steps:
    1. Define receipt methods for cash, checks, wire transfers, and other types of receipts.
    2. Assign receipt methods to bank accounts and specify automatic or manual entry options.

7. Set Up Bank Reconciliation Options

  • Navigation: Cash Management → Setup → Reconciliation → Reconciliation Options
  • Steps:
    1. Define reconciliation options for bank accounts, including tolerance limits, matching criteria, and auto-reconciliation rules.
    2. Set up parameters for bank statement formats and processing options.

8. Define Cash Management Calendars

  • Navigation: Cash Management → Setup → Calendars → Define Calendars
  • Steps:
    1. Define cash management calendars for reconciliation periods, cash flow forecasting, and funds transfers.
    2. Assign calendars to bank accounts and cash management responsibilities.

9. Define Transaction Codes

  • Navigation: Cash Management → Setup → Transactions → Transaction Codes
  • Steps:
    1. Set up transaction codes to categorize and identify bank statement lines, receipts, and payments.
    2. Define matching rules for automatic reconciliation based on transaction codes.

10. Define Bank Statement Codes

  • Navigation: Cash Management → Setup → Banks → Bank Statement Codes
  • Steps:
    1. Create bank statement codes to categorize different types of bank statement lines (e.g., deposits, withdrawals).
    2. Assign statement codes to bank accounts for streamlined reconciliation.

11. Define Cash Flow Forecasting Rules

  • Navigation: Cash Management → Setup → Forecasting → Forecasting Rules
  • Steps:
    1. Set up forecasting rules to predict future cash flows based on historical data and scheduled transactions.
    2. Define cash flow categories (e.g., inflows, outflows) and assign them to forecasting rules.

12. Set Up Funds Transfer

  • Navigation: Cash Management → Setup → Funds Transfer → Define Funds Transfer
  • Steps:
    1. Configure funds transfer methods for moving funds between bank accounts.
    2. Set up approval hierarchies, transfer limits, and processing

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