How Automatic Receipts Are Reversed

Use the Automatic Receipts Reversal process to identify the rejected settlements in a settlement batch and reverse the corresponding receipts. The process only reverses automatic receipts, not manual receipts.

Settings That Affect Reversal of Automatic Receipts

Before you can reverse automatic receipts in a settlement batch, you must map the ISO rejection codes to a reversal category. This mapping is used to derive the reversal category for reversing the receipt.

Use the Manage Reversal Reason to Category Mappings setup task to map the ISO rejection codes with corresponding reversal categories.

How Receipts are Reversed

When a bank can't process an automatic remittance of a record, the record is sent back for reversal. The returned record consists of two bank files:

• Reversal file - pain message 002.001.03. This message provides technical details of the reversals that are needed to reverse a receipt.

• Bank statement files CAMT-053.

The following steps outline the reversal process:

1. The Retrieve Funds Capture Acknowledgments process in Payments processes the pain message and sends information on the rejected receipts to Receivables.

2. The Automatic Receipts Reversal process receives the information on the rejected receipts and looks for the mapping between the rejection code and reversal category.

3. If a mapping exists for the rejection code, the corresponding receipt is reversed. If a mapping doesn't exist, the status of the corresponding receipt is set to Confirmed.

4. To reverse receipts that are set to Confirmed, you must define the mapping and run the Automatic Receipts Reversal process to reverse the corresponding receipts.

   Note: Reconciled receipts aren't reversed by the Automatic Receipts Reversal process. You must manually unreconcile the receipts before reversing them.

5. After the Automatic Receipts Reversal process completes, the Reversal Status Report is generated. Use the report to review the automatic receipt reversals processed in a settlement batch. The report displays details of the:

   • Receipts that are reversed along with the reversal reason

   • Receipts that aren't reversed and the reason they weren't reversed

6. The report is automatically run after the Automatic Receipts Reversal process. However, you can also run the report manually.