Business Blueprint Document

BBP-FI-06
Cash and Bank
PROJECT NIRMAN

Business Blueprint Document

BBD-FI-06 - Cash & Bank

Sep 2018

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 Business Blueprint Document
BBP-FI-06
Cash and Bank
PROJECT NIRMAN

TABLE OF CONTENTS

1 Document History ........................................................................................................................ 3

1.1 Change History .............................................................................................................................. 3
1.2 Approval Detail .............................................................................................................................. 3
1.3 Other Related Documents ............................................................................................................. 3
2 Business Process ........................................................................................................................ 3
2.1 Scope ............................................................................................................................................. 3
2.2 Key Business Requirements ......................................................................................................... 3
2.3 Key Assumptions and Dependencies ............................................................................................ 4
2.4 Associated Master data/ Organizational Elements ........................................................................ 4
2.5 Business Process Description ....................................................................................................... 4
2.6 Business Process diagram ............................................................................................................ 8
2.7 Business Process Step details .................................................................................................... 10
2.8 Inbound /Outbound Interfaces .....................................................................................................12
2.9 Process Variation/ Exceptions ..................................................................................................... 12
2.10 Key Process Improvements .................................................................................................12
3 Role Definition & Change Impact ............................................................................................. 13
3.1 Roles and Responsibility ............................................................................................................. 13
3.2 Change Impact (Organisational/System/Process) ......................................................................13
4 Gap Analysis & Resolutions ..................................................................................................... 13

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 Business Blueprint Document
BBP-FI-06
Cash and Bank
PROJECT NIRMAN

1 Document History
1.1 Change History

Ver. Date Summary of Changes Author

V.0 18.09.2018 First Draft Harish Arora

1.2 Approval Detail

Ver. Date Name & Position of Approver Signature

Process Owners:

Core Team:

Denpro Consultant :
Harish Arora

1.3 Other Related Documents

Related Document Comment

2 Business Process
2.1 Scope
It includes the management of bank master data, cash balance management (check and bill of exchange
management), and the creation and processing of incoming and outgoing payments. It is possible to freely
define all country-specific characteristics, such as the specifications for manual and electronic payment
procedures, payment forms, or data media.

2.2 Key Business Requirements

 Bank reconciliation through bank statement uploads without having soft copy of bank file from banks.
 Automation of cheque issue for all the banks for outgoing payments.

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 Business Blueprint Document
BBP-FI-06
Cash and Bank
PROJECT NIRMAN

2.3 Key Assumptions and Dependencies

NA

2.4 Associated Master data/ Organizational Elements

 Bank Key
 Bank Master Data
 Bank details maintained in Vendor and Customer Masters.

2.5 Business Process Description

2.5.1 Bank Master Data :

1. Bank Master Data (Bank Key) Maintenance:

Bank master data will now be maintained in SAP. The master data should be maintained centrally for the
entire Organization.

2. House Bank & Account ID Data Maintenance:

House Bank & Account ID maintenance will be done in the SAP. House Bank and Account IDs are created for
each company code.
Bank master data, house bank and account ID will be configured as per attached files.

2.5.2 Bank to Bank Fund Transfer :

Bank to Bank fund transfer is done in the following circumstances.

 Interest Bank payment

 Repayment of Term Loans/FDR
 Any other payments of vendor - RTGS

Bank to bank transfer are routed through RTGS

Accounting entries at each stage of the Bank to Bank Fund transfer process:-

 Accounting entry when internal fund transfer -

Dr. To respective bank Account 1000

Cr. from respective Bank A/c 1000

 Accounting entry when fund transfer to vendor account -

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 Business Blueprint Document
BBP-FI-06
Cash and Bank
PROJECT NIRMAN

Dr. Vendor 1000

Cr. To respective Bank A/c 1000

2.5.3 Bank Reconciliation:

1. For each bank account three different GL accounts shall be created in SAP viz. Main Bank
Account, Incoming Bank Clearing Account and Outgoing Bank clearing account.
2. All payments made will be credited to outgoing bank clearing accounts and all receipts shall
be debited to incoming bank clearing account. Main bank account will not be used and shall
be updated by system automatically at the time of BRS.
3. Bank statement is received from all banks on periodic basis. These statements received can
be made available in electronic as well as manual formats by the banks. Further, the manual
statements can be provided by the banks in their own formats in form of hard as well as soft
copies.
4. The data would then be converted into standard SAP format for BRS by attaching business
transactions against each unique nature of transactions. Some of the standard business
transactions would be maintained for:
a) Payments Incoming
b) Payments Outgoing
c) Bank Charges Clearing Account
d) FDR receipt clearing Account
e) Direct Debit Clearing Account
f) Direct Credit Clearing Account
g) Collection Clearing Account
3. The authorized user in C&B section would upload the formatted bank data in SAP and
execute the bank reconciliation on the desired date.
4. The SAP, on the basis of identified business transactions, would clear the items in the
incoming and outgoing bank G/L accounts and post the same to the main bank a/c.
Accounting Entry:
Dr./Cr. Main Bank Account
Dr./Cr. Outgoing Bank Clearing Account / Incoming |Bank Clearing Account

For business transactions for clearing accounts, SAP will post items in theses clearing
accounts and corresponding entry will be made to Main Bank Account. For example, in case
of RTGS/NEFT directly received in bank account. These entries would be directly credited in
the Direct Credit Clearing Account at the time of uploading of Bank Statement by C & B
section

Accounting Entry:

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 Business Blueprint Document
BBP-FI-06
Cash and Bank
PROJECT NIRMAN

Main Bank Account Dr XXX

To Direct Credit in Bank Clearing Account XXX

The concerned section will review the Direct Credit in Bank Clearing Account & clear the
entries by crediting the Customer Account

Direct Credit in Bank Clearing Account XXX

To Customer Account XXX

5. After BRS balance of Main Bank Account will always be tallies with balance as per bank
statement and item appearing as open in Incoming and outgoing clearing accounts will
represent reconciliation items.
6. BRS would contain mainly the following details:
 Cheques issued but not presented
 Cheques deposited but not cleared

2.5.4 Cash Journal (Petty Cash Book):

The cash journal is a sub-ledger of Bank Accounting. It is used to manage a company's cash
transactions. The system automatically calculates and displays the opening and closing balances, and
the receipts and payments totals. You can run several cash journals for each company code. You can
also carry out postings to G/L accounts, as well as vendor and customer accounts.

Cash transactions would be posted through the standard General Ledger feature of SAP.

Number range would be common for a company code.

A separate Cash journal would be created for each plant. Separate Petty Cash GL Accounts will be
created for every plant.

The document types for GL postings, Payments to/from vendors and Payments to/from customers are
entered while setup of a cash journal. However, to enable separate series of document for each profit
center, new document types will be created.

Cash Journal will be used to track cash related expenses. The cash balance at any point of time is
available online. By setting the cash balance at the beginning of the day, the cash journal shows the
cash balance at any time by adding the cash receipts and deducting the cash expenses.

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 Business Blueprint Document
BBP-FI-06
Cash and Bank
PROJECT NIRMAN

The cash journal also serves as a basis for entries in the general ledger and thereby represents the
"Cash" G/L account.

The cash journal is a single-screen transaction. This means that one can enter, display and change
cash journal documents on one screen. The following options are available:

 Entering, saving, and posting cash journal entries

 Cash journal entries can be saved locally in the cash journal. The system also
calculates the balances. The cash journal entries saved is then posted to the general
ledger.
 For a cash journal document, one can carry out CO account assignments, and have
taxes, including withholding taxes, calculated by the system with reference to
business transactions.
 Displaying follow-on documents
 The follow-on documents arising for the cash journal entries posted can be displayed
once the transaction is posted.
 Defining cash journal business transactions
 Defining cash journal business transactions is Customizing and user can use those
business transactions at the time of making entries in the cash journal.
 Printing the cash journal
 All the cash journal entries can be posted in the time period displayed. You select the
print form in Customizing.
 Printing receipts
 The cash journal entries saved can be printed.
 Reversal of cash journal entries saved
 With appropriate authorization, cash journal entries that have been saved can be
reversed.
 Displaying all cash journal documents that have been deleted
 All the cash journal documents that have been deleted within a specific time period
can be displayed.
 Changing the cash journal

 The cash journal and the company code can be changed while processing entries.

Cash journal accounting transaction type: The following transaction types exist:

 Expense (E)
 Revenue (R)
 Cash transfer cash journal to bank (B)
 Cash transfer bank to cash journal (C)
 Customer incoming/outgoing payment (D)
 Vendor outgoing/incoming payment (K)

Using document split, a single cash journal document can be created for a cash journal transaction
containing several items of different tax codes and/or CO account assignments.

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 Business Blueprint Document
BBP-FI-06
Cash and Bank
PROJECT NIRMAN

Cash sales/purchases routed through Cash journal will be done through One-Time Customer/Vendor
Account.

FIELD OPTIONS REMARKS

Company code and Cash journal Depending upon the journal in which
Cash Journal No entry is proposed to be done, cash
journal would be selected.
Display period Today, This week, Current
period.
Business Transaction Name of the business Depending upon the type of
transaction. transaction, business transaction
data needs to be selected. It should
be noted that if Vendor is selected as
an option the system will allow an
entry in the field vendor only and not
GL accounts/customer field. Similarly
if customer is selected as an option
the system will allow an entry only in
the field customer and not GL
account/vendor.
Amount Amount lesser than cash The system will allow entering an
balance amount that is lower than the
available cash otherwise it will give
an error message.

2.6 Business Process diagram

1. Bank Master Data

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 Business Blueprint Document
BBP-FI-06
Cash and Bank
PROJECT NIRMAN

2. Bank to Bank Fund Transfer

B a n k to B an k F un d T ransfer

Is the re a ny p ay m e nt to be m a de
S tart fro m ba n k a cco un t in w hich su fficie nt
ba la nce no t ava ila b le?
No
Finance & Accounts

Y es

T ran sfe r
fun d s fro m
o th er ba nks
or C orpo ra te
O ffice
G e ne ra te
Fu n d
E nd
T ra ns fe r
re qu es t le tter

3. Bank Statement Processing and Bank Reconciliation

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 Business Blueprint Document
BBP-FI-06
Cash and Bank
PROJECT NIRMAN

B a n k R e c o n c ilia tio n

P r o c e s s M a n u a lly
Is th e b a n k
O r u s e e x is tin g
S ta r t s ta te m e n t in s o ft No
e x c e l u p lo a d
copy?
p ro c e s s

Yes

C o n v e rt th e
Treasurey

docum ent

P ro c e s s R u n b a tc h
End
E le c to ro n ic in p u t

4. Payment Procedure

2.7 Business Process Step details

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 Business Blueprint Document
BBP-FI-06
Cash and Bank
PROJECT NIRMAN

Name Description Transaction Code, Roles Regulatory

if relevant involved /Other
Controls
Bank Master
Creation of Bank Key In this field, you specify the bank FI01/FI02/FI03
key under which bank data from
the respective country is stored.
Once bank key created, basic
information like address, city, bank
branch etc.
Creation of House Once the Bank key is created the FI11/12/13
bank next step is to create House
Bank and account id.
Bank
Reconciliation
Manual Bank Reco. Need to convert bank statement FF67
in SAP format and will be
uploaded for reconciliation.
Batch Input Session After uploading the bank SM35 Authorisatio
statement, need to execute batch n to
session, so system will create restricted
posting and cleared interim users only.
accounts.
Display of Document In this activity, you can enter the FB03
company code, fiscal year,
document number then we will
get the uploaded the document
Bank G/L Balances In this activity, you can display FAGLB03
the bank G/L Balances.
Bank Clearing Match items in bank clearing F.13
accounts
Payment
Procedure
Automatic Payment At a time to clear vendor open F110
program (APP) item and print the cheques in
batch we can use APP program
Print and Post The system posts the payment F-58
Payment transaction into the system and
prints a payment document along
with the cheque in name of the
party being paid.
Post Payment Open vendor invoices are paid F-53/ F-48
through for the post outgoing
payment transaction. This is
exactly the same transaction as
the manual print with post
transaction explained above, but
the difference is that there is no
output in the end. This
transaction just posts the
payment.

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 Business Blueprint Document
BBP-FI-06
Cash and Bank
PROJECT NIRMAN

Print Payment Form Once the payments are posted, FBZ5

cheques can be printed using the
print form functionality. Here the
cheque information has to be
updated.

LC Payment
Decision taken to After posting the vendor invoice if F-40
make payment in LC user want to convert or transfer
the Creditor liability in to Letter of
credit or bill payable liability we
can use the functionality.
If we don’t want to convert or F-55 / F-56
transfer the creditor liability in to
LC liability and want to track only
Letter of credit as contingent
liability (statistical liability). On
due date, reverse the contingent
liability.
Down Payment
against PO
Down Payment Purchasing Department made F-47
Request request for down payment
against particular purchase
order.
Treasury Based on funds availability, N.A.
Department department accept or reject
request. If accepted asked the
finance department for Payment.
Down Payment Based on down payment request F-48
Treasury department will
released the payment.
Cash Journal/ Petty To book cash related FBCJ
Cash Book transactions related to General
ledger, Customer and Vendor

2.8 Inbound /Outbound Interfaces

Sr. No. Interface Source System Target System Data Transfer Frequency/Trigger
Description
1 Bank Excel file in
Statement - prescribed format
for manual
upload excel file

2.9 Process Variation/ Exceptions

N/A

2.10 Key Process Improvements

N/A

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 Business Blueprint Document
BBP-FI-06
Cash and Bank
PROJECT NIRMAN

3 Role Definition & Change Impact

3.1 Roles and Responsibility

S. No. Role Responsibility

1 Creation of the Bank Master Data Central Master Data Management Team
2 Creation of Cheque lots Accounts Manager
3 Void Cheque Accounts Manager
4 Maintaining the Cash Journal Account Clerk

3.2 Change Impact (Organisational/System/Process)

1. For each house bank (i.e. banks with which Company is dealing), Main GL account will be maintained,
And there will be two more accounts i.e. incoming and outgoing clearing account. Thus at any point of
time, Balance in Incoming and Outgoing bank clearing account will be the Reconciliation items for that
bank account.

4 Gap Analysis & Resolutions

N/A

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