With Oracle Cash Management, you can reconcile payments created in Payables to your bank statements. When you reconcile payments using Oracle Cash Management, Cash Management updates the status of payments to Reconciled. If you enable the Account for Payment When Payment Clears option, in the Oracle Payables Options window, Accounting Option tab, Oracle Payables creates reconciliation accounting entries for the following when you submit the Create Accounting process:
The delay in the bank clearing of payments from the time of issuance to the time of reconciliation
Differences between the original payment amount and the cleared payment amount due to exchange rate fluctuations, bank charges, or bank errors
Reconciled payments
Unreconciled payments
Attention: You can reconcile foreign currency payments that have no exchange rates. However, Oracle Payables will not create reconciliation accounting entries. If you enter the exchange rate in the GL Daily Rates table and then submit the AutoRate program, Oracle Payables automatically creates the reconciliation accounting entries for payments that were reconciled without exchange rates.
To review payments that have not cleared, you can use the Unclaimed Property Report. See: Unclaimed Property Report.
Define ledgers. See: Defining Ledgers.
Choose a ledger for each responsibility when you set up your Payables application. You set this primary ledger in the Choose Ledger window in Oracle Payables.
Payables requires you to choose a ledger for your operating unit (in a multi-organization environment) or for your installation (in a single organization environment).
Note: The ledger you enter here will be available to choose as the Ledger Name in the Cash Management System Parameters window. See: Choosing a Ledger.
The Account for Payment option in the Payables Options window has the following two check boxes:
When Payment is Issued
When Payment Clears
You can select one or both options. To account for payments that you reconcile in Oracle Cash Management, you must select at least When Payment Clears. This also allows you to use a cash clearing account and create accounting entries for bank charges, errors, and gains/losses. If you do not enable this option, you can still reconcile payments in Payables, but you cannot create reconciliation accounting entries.
The Account for Gain/Loss option in the Payables Options window has the following two check boxes:
When Payment is Issued
When Payment Clears
You can select one or both options. Enable at least When Payment Clears. You must enable this option to account for the gain or loss between the estimated functional currency payment amount that was calculated at invoice entry and the actual functional payment currency amount that was recorded when the bank disbursed funds for the payment.
ISSUED BILLS PAYABLE. Oracle Cash Management cannot clear bills payable that have a payment status of Issued. Oracle Cash Management clears bills payable only if the payment status is Negotiable. On or after the maturity date of the payment, you can update the status to Negotiable.
Other Sources
Bank Account Model Overview, Oracle Cash Management User Guide