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Coworking:Financial Account

This article is protected against manual editing because it is automatically generated from Openbravo meta-data. Learn more about writing and translating such documents.
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Contents

Introduction

A Financial Account represents an account at a financial institution such as a bank account, a credit card issuer, an electronic payment service, as well as a cash or petty cash register.

Openbravo allows to create as many Financial Accounts as required by the organization in the financial account window which therefore is used to record monetary transactions such as invoice payments, bank fees, credit card charges, etc.

Payment obligations and amounts due from customers are created in the Purchase and Sales invoice windows. Collections from customers and payments to suppliers for these invoices, however, are normally recorded in the Financial Account window or in the Payment In and Payment Out windows.

It is very important to properly define every parameter of each Financial Account. During your Financial Account setup process, you will need information like: the bank account information, the payment methods allowed, the bank account currency/ies, the accounting information, etc. Have a look at Financial Account Screen Reference in order to collect all needed information.

Account

The financial account window contains essential information such as the bank account number and allows to perform a set of processes such as to add deposit or withdrawal transactions to the financial account or to import and match a bank statement file.

Financialaccount01.png

The essential financial account information to be filled in the top section of the financial account window is:

The next section Bank Account is visible only for accounts of the type Bank and are used to specify the bank account number. This section includes information such as:

Note that other options can be added by other modules that extend the supported Bank Account Format.

More information section can include information such as:

Let's take for instance the setup of a "Write-off Limit" amount of 1,00 $ for a given financial account.
While registering a customer's payment in the Add Payment window the system will not allow to write off an amount above the write-off limit amount defined.
Same applies to supplier's payments created by using the Add Payment window or the Payment Proposal feature.

The financial account window allows to perform below listed actions:

Transaction Tab

The transactions of a financial account can be of two types:

Those two transaction types can be created in three ways:

AddTransation.png

If it is needed to create a "Bank Fee", Select "Bank Fee" in "Transaction Type" combo, enter a transaction and accounting date and the amount either received in or paid out.
Then save and process the transaction.

BankFeeTransaction.png

To create a new G/L item transaction, select "BP Deposit" or "BP Withdrawal" in transaction type and select the "G/L Item" in the G/L item combo, enter a transaction and accounting date, select a G/L Item, enter the amount either received in or paid out and save and process the transaction. .

GLitemTransaction.png

If the user needs to create a new payment transaction it is allow to select a created payment or create a new payment from the payment selector.

SelectorPaymentTransaction.png

Description and amount fields in transaction tab will be automatically filled and to complete the transaction it is necessary to save and process.

SelectorPaymentTransaction2.png

AddPaymentTransaction.png

AddGLitemTransaction.png

Payment selector has applied a explicit filter (current financial account)

AddPaymentTransactionFilterByFA.png

It is possible to add payments for alternative financial account by clicking in the funnel icon to clear the filters.

AddPaymentTransactionNotFilter2.png

This behavior is very useful in the following scenario:

Add Multiple Payments

"Add Multiple Payments" process button available since PR15Q3, allows to create & process financial account transactions by selecting several payments at the same time.

The payments shown for selection are the ones having a payment status equal to "Payment Made" or "Payment Received", therefore payments having an "Awaiting Execution" payment status for instance will not be shown for selection.

By default the payments shown are the ones originally defined for this financial account. However the user can remove this filter to show & select payments from other financial accounts.

AddMultiplePaymentsPE.png

Only actions to take are entering a "Transaction Date" and selecting as much payments as required at once.

Payments selected are then listed as either:

in the "Transaction" tab of the Financial Account.

All those new transactions are created as already "processed", therefore can either be "reactivated" if required or finally "post" to the ledger if applicable.

Reconcile

The header process button "Reconcile" is shown for those financial accounts which do not have a matching algorithm assigned.

That button opens the "Reconciliation" window.

The reconciliation window has three main parts:

The "Beginning Balance" + the amounts "Received In" - the amounts "Paid Out" need to be equal to the "Ending Balance".

You can either enter the ending balance or what the statement says and then select the transactions paid out/received in or the other way around.

Let's take intentionally a very simple example:

Note that it is possible to create a "G/L item" transaction in case there are some minor differences between what the statements says and the recorded transactions pending to be reconciled.
FinancialAccount Difference.png

The "Save" process button saves a "Draft" of the reconciliation in the Reconciliations tab of the financial account and marks the transaction/s selected as "Cleared" as also "Cleared" in the financial account, transaction tab.
It is always possible to re-open a saved reconciliation and modify whatever it is needed.
Note that there can only be one reconciliation in draft status in a financial account.

The "Reconcile" process button reconciles the transactions marked as cleared, therefore the reconciliation is processed and its status changes to "Completed".

Finally the "Cancel" process button just closes the reconciliation window and removes the ending balanced entered if any.

Import Statement

The header process button "Import Statement" is shown for those financial accounts which do have a matching algorithm assigned. This process button allows to import a bank statement which therefore is saved in the Imported Bank Statements tab of the financial account, and in the Bank Statement Lines sub-tab.

Openbravo currently delivers the "Standard" matching algorithm. The behavior of the standard matching algorithm is explained in the next section "Match Statement".

Openbravo allows to import a bank statement if an Import Bank File Format module has been previously installed.

Openbravo currently delivers below listed import bank file modules:

Depending on the module installed for this purpose, it will be possible to import bank statement files in OFX format or CSV format among others.

The "Import Statement" process button opens the "Import Bank File" window.

Import Bank File.png

This window allows to:

Match Statement

Once a bank statement file has been imported The button "Match Statement" opens a new window where the imported bank statement lines and the existing financial transactions are displayed. By default there is an implicit filter which hides the bank statement lines that are already matched.


MatchStatement.png

Before opening the Window, a pop up will be shown, asking whether the algorithm should run against unmatched bank statement lines or not. If so, the algorithm will try to find a match for all the unmatched bank statement lines. If not, the matching Window will open and the user should do the matches manually.

Confirm.png

This window has two column groups divided by the Match column.

As already mentioned the matching algorithm available is the "Standard matching algorithm".
The Standard matching algorithm can be configured to match by different set of criteria:

Above criteria can all be selected or just some of them.


Not matched transactions can be matched manually. Let's take for instance below shown starting situation where there are two bank statement lines do not match and one match with a weak match:

MatchStatement2.png


MatchStatementSelector.png.
Back to our example, there is no transaction which matches the second transaction of the bank statement file (the one with an amount equal to 1.500,00) but the first one (the one with an amount equal to -2.500,00, that is a withdrawal). That one could be selected as an strong match from the fist bank statement line by using as well the "magnifying glass" icon.
MatchStatementAddTransaction.png
The image above shows that there was a "Received In" transaction pending to be created in the financial account. Once created it is matched.
Back to our example the current situation is shown in the image below:
MatchStatement3.png
There is only one transaction pending to be matched. The "magnifying glass" icon helps again to search for transactions to match. This time there is one transaction which almost matches as its amount is 2.500,00
MatchStatement4.png
If that one is selected Openbravo shows a message which informs that the transactions do not fully match therefore a partial match can be performed. Since Openbravo 3.0PR14Q4, the user can set the 'Match Statement: hide partial match confirmation popup' to Y for the Financial Account window to hide this confirmation message in the future (it will require to log out and log in)
MatchStatement5.png
This action matches the bank statement line and creates a new line pending to be matched for the difference.

Starting from version PR14Q2, there is a new process to be able to force both reactivating and processing reconciliations. Just in case some mistake was made, user can force system to permit reactivating old reconciliations to be able to correct that data.

This should not be the standard procedure as there should be an exercise of reviewing data before validating/processing a reconciliation. In any case, errors happens and to be able to solve the situation without a big impact for the user there are now these two buttons as advanced features.

This process will impact starting and ending balance of subsequent documents whenever ending balance changes for the reconciliation being edited.

Funds transfer

New feature available in 16Q4.

Input fields:


Funds Transfer.png

Process

Being in the account tab and selecting the corresponding financial account:

Transaction

This tab shows all the transactions of the financial account.

As already explained those transactions can either be:

The transactions shown in this tab can be:

Some fields to note are:

Exchange rates

This tab allows to define an exchange rate to use while posting the financial account transaction to the ledger whenever the currency of the financial account is not the same as the general ledger currency.


Accounting History

This tab shows the accounting history of a given transaction.

FinancialAccount AccountingHistory.png

As shown in the image above this tab show the general ledger entries created while posting/unposting a given transaction to the ledger.

Accounting Configuration

The accounting configuration tab is used to define the accounts of a General Ledger to use while posting transactions such as a bank fee or a deposit.

Accounting Configuration.png

As shown in the image above below listed accounts can be configured for a financial account and general ledger.

General section:

Remember that it is possible to receive payments and to make payments in a currency different to the financial account currency.
In case of a "Cash" Financial Account type, the ledger account used to credit an exchange rate gain is the "Bank Revaluation Gain" account of the Defaults tab of the General Ledger Configuration.
In case of a "Cash" Financial Account type, the ledger account used to credit an exchange rate gain is the "Bank Revaluation Loss" account of the Defaults tab of the General Ledger Configuration.

The checkbox Enable Bank Statement allows to post Bank Statements. If selected two additional fields are shown:

As a bank statement posting is a transitory posting until the transactions have been finally cleared, the "Bank Transitory Account" must be the same account as the one used upon clearing.

As soon as a "Bank Transitory Account" is defined, the system shows a warning stating that "When posting Bank Statements, the Bank Transitory Account should match the account used upon clearing for all payment methods in order to ensure properly balanced accounting. Do you want to propagate this value to all payment methods?"

Payment IN / Payment OUT sections:

These sections of the accounting configuration tab are closely related to another tab of the financial account window that is the Payment Method tab.

The Payment Method tab allows to define which step of the payment workflow can be posted to the ledger. That can be defined for each payment method assigned to the financial account

The "Accounting Configuration" tab allows to select the ledger accounts to use while posting in transit payments in/out, deposit/withdrawal transactions or reconciliations linked to a given payment method.

It is important to remark that:

More in detail:

Payment In section:

Payment out section:

Payment Method

This tab lists all the payment methods assigned to the financial account. A payment can either be deposited in or withdrawn from the financial account if the payment method used is assigned to the financial account.

Every Financial Account can have more than one payment method assigned, payment methods such as "Check", "Wire Transfer", "Cash".

The fact of assigning a payment method or a set of payment methods to a given financial account means that it is possible to manage through a given financial account only those payments linked to any of the payment methods assigned to that financial account.

Payment Methods are created and configured in the Payment Method window. Once created and configured there can be assigned to a financial account in this tab. The way to do that is:

In this tab there is the advanced feature (hidden by default) called invoice paid status control, this functionality provide a configuration option to be able to decide which status for each payment determines an invoice is paid or not. For additional information about How to Configure Invoice Paid Status Control visit the article.

This combo can be set at payment method level (payment in and payment out) in each financial account. By default this combo is set as payment received or payment made, therefore we get the usual behavior of Openbravo.

For additional information about payment method configuration, visit the Payment Method article.

Imported Bank Statements

The tab lists the imported bank statement files as well as the bank statements created manually.

Financialaccount10.png

There are key fields to note:

An imported bank statement file can be "Reactivated" as once imported it gets processed automatically.

Once reactivated the bank statement header information as well as the bank statement lines can be changed as required.

Once done the bank statement can be Processed once again.

A Bank statement can be posted if that it is enabled in the accounting configuration tab of the financial account.

If you are not able to import a bank statement file, it is also possible to create bank statements and bank statement lines manually.

Bank Statement Posting example

This article illustrates Bank Statement posting concept with an example.

Example: bank statement posting

Let's consider a scenario where a bank statement contains 3 bank statement lines for a total amount of -5627.42€. The system will show below ledger entries after posting the bank statement.

Account Dr Cr
Bank transitory account 5627.42
Bank asset account 5627.42

Negative Bank Statement Lines:

Let's imagine that one of the bank statement lines has an amount = -4.627,42, that would mean a payment OUT: (Debit Amount = Payment OUT= Paid)

Bank statement line clearance posting looks like:

Account Dr Cr
Vendor liabilities 4627.42
Bank Transitory account 4627.42

Therefore the complete set of posting will look like:

Invoice posting:

Account Dr Cr
Expense 4627.42
Vendor liabilities 4627.42

Bank Statement Posting:

Account Dr Cr
Bank transitory account 4627.42
Bank asset account 4627.42

Bank statement line clearance posting:

Account Dr Cr
Vendor liabilities 4627.42
Bank Transitory account 4627.42

Positive Bank Statement:

Let's imagine that one of the bank statement lines has an amount = + 1000,00, that would mean a payment IN: (Credit Amount = Payment IN = Received)

Bank statement line clearance posting:

Account Dr Cr
Bank Transitory account 1000.00
Customer 1000.00

Therefore the complete set of posting will look like:

Invoice posting:

Account Dr Cr
Customer 1000.00
Income 1000.00

Bank Statement Posting:

Account Dr Cr
Bank Asset Account 1000.00
Bank Transitory Account 1000.00

Bank statement line clearance posting:

Account Dr Cr
Bank transitory account 1000.00
Customer 1000.00

And Finally, the last bank Statement line for an amount = -2000.00, that would mean a payment OUT: (Debit Amount = Payment OUT= Paid)

Bank statement line clearance posting:

Account Dr Cr
Vendor liabilities 2000.00
Bank Transitory account 2000.00

Therefore the complete set of posting will look like:

Invoice posting:

Account Dr Cr
Expense 2000.00
Vendor liabilities 2000.00

Bank Statement Posting:

Account Dr Cr
Bank transitory account 2000.00
Bank asset account 2000.00

Bank statement line clearance posting:

Account Dr Cr
Vendor liabilities 2000.00
Bank Transitory account 2000.00

Bank Statement Lines

This tab list all the lines of a bank statement.

There are key fields to note:

Reconciliations

The reconciliation tab shows the reconciliations created manually if no matching algorithm is assigned to the financial account as well as the ones created while matching an imported bank statement file otherwise.

Manual Reconciliations

Automatic Reconciliations

FinancialAccount Reconciliations.png

Reconciliations Posting

A Reconciliation of any type can be posted if the Payment Method used while creating the payment to be reconciled allows to do so once assigned to the financial account. If that is not the case Openbravo shows a warning : "Document disabled for accounting".

A "Deposit Reconciliation" posting looks like:

a. if the Payment Received was NOT posted in the "Payment In" window and the Deposit Transaction was also NOT posted in the "Financial Account" window:

Account Debit Credit
Upon Reconciliation Use the "Cleared Payment Account" (i.e) Payment amount
Customer Receivables Payment amount

b. if the Payment Received was posted in the "Payment In" window and the Deposit Transaction was NOT posted in the "Financial Account" window:

Account Debit Credit
Upon Reconciliation Use the "Cleared Payment Account" (i.e) Payment amount
Upon Receipt Use the "In Transit Payment IN Account" (i.e) Payment amount

c. if the Payment Received was posted in the "Payment In" window or not and the Deposit Transaction was posted in the "Financial Account" window:

Account Debit Credit
Upon Reconciliation Use the "Cleared Payment Account" (i.e) Payment amount
Upon Deposit Use the "Deposit Account" (i.e) Payment amount

Each posting will be different when the amount comes partially o totally from a debt classified as doubtful. In that case, the posting will be as explained in | Doubtful Debt Run Window.

A "Withdrawal Reconciliation" posting looks like:

a. if the Payment Made was NOT posted in the "Payment Out" window and the Withdrawal transactions was also NOT posted in the Financial Account window:

Account Debit Credit
Vendor Liability Payment amount
Upon Reconciliation Use the "Cleared Payment Account" (i.e) Payment amount

b. if the Payment Made was posted in the "Payment Out" window and the Withdrawal transactions was NOT posted in the Financial Account window:

Account Debit Credit
Upon Payment Use the "In Transit Payment OUT Account" (i.e) Payment amount
Upon Reconciliation Use the "Cleared Payment Account" (i.e) Payment amount

c. if the Payment Made was posted in the "Payment Out" window or not and the Withdrawal transactions was posted in the Financial Account window:

Account Debit Credit
upon Withdrawal Use the "Withdrawal Account" (i.e) Payment amount
Upon Reconciliation Use the "Cleared Payment Account" (i.e) Payment amount

Reconciliations Reporting

Additionally there are two reports which shows information about each reconciliation, those reports can be run from the process buttons:

Cleared items

This tab shows the transactions cleared or set as matched in a reconciliation.

As soon as either a manual or an automatic reconciliation is "Saved" in "Draft" status in the Reconciliations tab, this sub-tab allows to see the transactions cleared in the Reconciliation window or match against a bank statement line in the Mach Using imported Bank Statement Lines window.

It is not possible to remove the cleared items from this sub-tab but from either the "Reconciliation" window or the "Mach Using imported Bank Statement Lines" window whenever the reconciliation has been "reactivated".

Cleared item sub-tab allows to see below information:

Accounting

The accounting tab is a read-only tab which showa every financial account transaction posting.

Unlike the Financial_Account#Accounting_History tab, this tab shows all the financial account accounting data, not just the accounting related to a transaction.



Full list of Financial Account window fields and their descriptions is available in the Financial Account Screen Reference.

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