Configurations for Automatic Reconciliation Process for Cash Management in Oracle Fusion Applications

This article gives an overview of the configurations for Automatic Reconciliation Process for Cash Management in Oracle Fusion Applications. Below is a quick diagram:

Besides setting up the Bank, Bank Branch and Bank Accounts, below are some Configurations for Automatic Reconciliation Process for Cash Management in Oracle Fusion Applications:

Bank Statement Lines	Transaction Code	Transaction Type
Receipt 10,000 USD	222	Check
Disbursement 5,000 USD	475	Check
Bank Charges 100 USD	698	Fees

Bank Transaction Codes

• Bank statement transaction codes are internal codes that are used on a bank statement line to identify the type of transaction being reported.
• For example, there might be a code of "100" in the bank statement, and that code indicates that the line is a deposit.
• These codes are normally numeric and these codes identify what the bank statement transaction line is about.
• There are already predefined bank transaction codes, and custom codes can also be created.
• In the example table above, it shows that transaction codes 222 and 475 are both Check transactions, but they are different because one is a Receipt from a Customer Payment (Inbound), and the other is a Payment Disbursement to a Vendor (Outbound). This is where Transaction type Mapping comes in.
• Below is a video demonstration of Creating Bank Transaction Codes in Oracle Fusion Applications:

Transaction type Mapping

• You want to make sure that those transaction codes mentioned above match to what your bank uses.
• There are different transaction types for different modules, so Transaction type mapping identifies the transaction types for payables, receivables, and provide a description for them.
• Some samples of transaction types are fees, lockbox, miscellaneous transactions, a reversal, a check, a bank adjustment. These are the transaction types that you will be mapping and specifying the module that they belong to.

Matching Rules

• Allows the automatic reconciliation process to automatically match lines from a Statement to the transactions.
• Usually, its one bank statement line to one system transaction (i.e. customer receipts in receivables, supplier payments in payables, etc) or one to many.
• However, It does not have to be one to one. It can be one to many. One statement line that you are matching to a batch of customer receipts in AR. So a group of customer receipts, many to one, as you can see here. Many bank statement lines for one system transaction, or many to many, which makes the rules are a little more complex.
• Below is a video demonstration of Creating Matching Rule in Oracle Fusion Applications:

Tolerance Rules

• Tolerances specifies how much can you deviate in terms of amount, date or percentages.
• For example, your specified tolerance is set to two to three days, it's going to allow the bank Statement to match if the date is a bit off by two to three days.
• Another example would be If the amount is off by a few pennies, it might be due to the exchange rates that you see the difference, if you're dealing with multi-currency, and so on.
• You can express variances or tolerances in an amount versus a percentage. If you use both, the system AutoReconciliation will consider the smallest of the two.
• Below is a video demonstration of Creating Bank Statement Reconciliation Tolerance Rules in Oracle Fusion Applications:

Reconciliation Rule set

• A group of rules that allow AutoReconciliation to match and assess tolerances and determine what is acceptable and what is not.
• Groups together the matching rules, the tolerance rules, and attaches them to the bank account.
• Below is a video demonstration of Creating Reconciliation Rule Sets in Oracle Fusion Applications:

• Below is a video on how Reconciliation Rule Sets attaches to a bank account

Payment Code Map Groups

• Payment Code Map Groups are codes that identify code groups in a bank statement such as opening and closing balances in a statement, and other codes that identify actual transactions lines on a bank statement. They simply identify if the line is an opening/closing balance or an actual transaction.

Payment Code Map Group Name	Field Value	Bank Transaction Code	Transaction Type Mapping
Bank of America BAI2	CE_TRX_CODE	174	WIRE IN
Citibank BAI2	CE_TRX_CODE	174	DEPOSIT

In the above example, Bank of America uses the code 174 to identify wires, but the same code, 174, might be used by Citibank to identify deposits. Of course, both of these are incoming money, but it is important to know the difference between a wire and a regular deposit.

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