Multi-Currency Clearing (Oracle Cash Management User's Guide)


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Multi-Currency Clearing

Clearing takes place after matching, so any difference between the statement line amount and the original transaction amount is already verified to be within the specified tolerance limit.

Cash Management determines clearing amounts for the charges, errors, and foreign gain/loss accounts as necessary to clear the transaction.

Bank Account Currency is Functional (International Scenario)

Cash Management checks the Foreign system parameter (in the Tolerance Differences region of the System Parameters window) to determine what to do with the difference between the cleared amount and the transaction amount. The options are as follows:

Gain/Loss

calculated rate

Charges/Errors

The unaccounted difference is due to charges or errors.

Receivables

Differences are always bank charges.

Payables

Cash Management checks the system parameter AP Tolerance Differences to determine whether the difference is due to charges or errors.

No Action

The unaccounted difference indicates an error. The statement line must be reconciled manually.

Bank Account Currency is Foreign (Foreign Scenario)

How differences are handled in this case depends on the transaction source:

Receivables

Differences are always bank charges.

Payables

Cash Management checks the system parameter AP Tolerance Differences to determine whether the difference is due to charges or errors.

Example of Multi-Currency Clearing for International Scenario

The following tables show how Cash Management clears discrepancies:

Oracle Cash Management Clearing Example (International Scenario)

Functional Currency
USD AP Tolerance Difference
Errors Tolerance Percent
50

Bank Account Transaction Information in Oracle Receivables and Oracle Payables

Date Source Ref Description Expenditure Deposit

22-Jan

25-Jan
A/R

A/P
bid2002

bid1015 Halifax Printworks
CAD 10,000 (Rate = 0.5)
Sutcliff International, Ltd.
UKS 10,000 (Rate = 1.5) 5,000.00

15,000.00

Bank Statement Lines, Received From Bank, Sorted by User

Date Type Ref Description Expenditure Deposit

26-Jan

28-Jan Receipt

Payment bid2002

bid1015 Halifax Printworks
CAD 10,000 (Rate = 0.4)
Charge USD 40
Sutcliff International, Ltd.
UKS 10,000 (Rate = 1.6)
Charge USD 40 3,960.00

16,040.00

Oracle Cash Management Clearing Example (International Scenario)
Functional Currency USD	AP Tolerance Difference Errors	Tolerance Percent 50

Bank Account Transaction Information in Oracle Receivables and Oracle Payables
Date	Source	Ref	Description	Expenditure Deposit
22-Jan 25-Jan	A/R A/P	bid2002 bid1015	Halifax Printworks CAD 10,000 (Rate = 0.5) Sutcliff International, Ltd. UKS 10,000 (Rate = 1.5)	5,000.00 15,000.00

Bank Statement Lines, Received From Bank, Sorted by User
Date	Type	Ref	Description	Expenditure Deposit
26-Jan 28-Jan	Receipt Payment	bid2002 bid1015	Halifax Printworks CAD 10,000 (Rate = 0.4) Charge USD 40 Sutcliff International, Ltd. UKS 10,000 (Rate = 1.6) Charge USD 40	3,960.00 16,040.00

After Reconciliation

The following table displays how Cash Management would resolve the transaction and bank statement line differences for the above example (International Scenario):

After Reconciliation

System Parameter: Foreign Difference Handling Ref Amount Reconciled Charges Errors Curr Rate

Gain/Loss bid1015 16,040.00 40.00 0.00 UKS 1.6

Charges/Errors bid1015 16,040.00 40.00 1,000.00 UKS 1.5

No Action (unreconciled)

Gain/Loss bid2002 3,960.00 40.00 CAD 0.6

Charges/Errors bid2002 3,960.00 1,040.00 CAD 0.5

No Action (unreconciled)

After Reconciliation
System Parameter: Foreign Difference Handling	Ref	Amount Reconciled	Charges	Errors	Curr	Rate
Gain/Loss	bid1015	16,040.00	40.00	0.00	UKS	1.6
Charges/Errors	bid1015	16,040.00	40.00	1,000.00	UKS	1.5
No Action (unreconciled)

Gain/Loss	bid2002	3,960.00	40.00		CAD	0.6
Charges/Errors	bid2002	3,960.00	1,040.00		CAD	0.5
No Action (unreconciled)

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