Understanding the Settlements Payment Process

This section discusses the process for handling settlements within Treasury.

Settlements are cash flow transactions that the system transforms into payment instructions for different financial institutions. In Cash Management you can generate settlements from bank account transfers, electronic funds transfer (EFT) requests, and fee entries. You can also generate a settlement by entering a deal in Deal Management. The settlement process involves three steps: selection, approval (an optional step), and dispatch. You first select settlements that are to be processed as payments by using the Select Settlements page. Depending on system settings, certain selected settlements must be approved prior to being processed. You can establish one of three following settlement approval methods:

  • No approval required.

  • Manual settlement approval, performed by an authorized user (or users) by using the Settlement Approval page.

  • Automatic settlement approval, performed by PeopleSoft Workflow.

If the financial sanctions service is enabled and the bank that is being used to pay requires validation, the system automatically performs a search for the matches between the names and addresses entered on the settlement with those on the financial sanctions list. This functionality is enabled on the Financial Sanctions Options page by selecting the Enable in Treasury Settlements check box.

See Application Fundamentals: Financial Sanctions Options Page.

Next, the Financial Sanction Validation check box must be selected on the Bank Information page. Settlements transacted through these banks will initiate the financial sanctions comparison upon there selection.

See PeopleSoft Banks Setup and Processing: Bank Information Page.

Once the settlements are approved, they are either sent to Financial Gateway where they are dispatched to a financial institution using the Dispatch Payments page or obtained by the Pay Cycle Manager for processing. The system processes payments according to the pay method that is defined on the External Accounts - Payment Methods page. Depending on the payment method type, you can specify that the payment be settled through one of two methods: PeopleSoft Financial Gateway or the Payables Pay Cycle Manager. Within Financial Gateway, the dispatch process transforms these settlements into payment files, and submits them to the appropriate institution.

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