The overall number of checks issued in the United States continues to decline year over year. Despite the declines, the practical reality in the US is that many companies must still print checks.  Given the realities, what are your best options for keeping the check register up to date in SAP?


In the world of SAP, there are typically several ways to accomplish a process depending upon what is best for your organization. Last week we discussed some of the considerations that may influence the solution you pursue. This week, I will discuss the first of three potential options to consider:

 

Option 1: Electronic bank statements optimized with search strings

Option 2: Check encashment file

Option 3: Manual encashment

For our examples, I have used a system that is ECC 6.0 with EHP6. These examples should work on previous releases as well, as this area of functionality is not undergoing any significant changes right now.

Checks can be issued in batch via transaction F110, or individually through transaction F-58.  Checks issued from SAP are updated to the check register.  The check register is used to keep a running list of all checks in the system. The best way to see check activity from the SAP system is to look into the check register, transaction FCHN.

Here is an example of a check register showing an open check.

Displaying the check, I would see the following information:


Once the outstanding checks have been cashed by the customer/vendor, there are two things that need to happen:

  1. The general ledger needs to be updated to show that the funds have left a clearing account and now reflect the credit to cash.
  2. The check itself needs to be marked as cashed.  This is important, as different states in the US have escheatment laws. Escheatment laws determine when something must be turned over to the states as unclaimed property and the processes that must be followed.  To learn more about different state requirements on escheatment, click here.


Option 1: Electronic bank statements optimized with search strings

If you receive individual checks back on an electronic bank statement, the individual checks can be updated on the check register automatically as part of the standard bank statement reconciliation process.


Often, the information that is originally sent to the bank may not match what is sent back from the bank on the electronic bank statement.  In this example, the check number is being passed as part of the note to payee records (88 records on a BAI2 layout, as opposed to being in the reference information in the 16 record). Let’s say that while we use a 6 digit check number from our check, our bank passes back the check number with two leading zeroes. Therefore if SAP tries to read the check number to update the register, it will never match based on the standard electronic bank statement configuration.   Here is an example from a bank statement:


How can this be handled automatically?  Using the functionality available in search strings, we can make a simple mapping update that will allow us to then the check posted to the general ledger and marked as cleared on the check register.

Note: this posting does not describe how to handle the primary electronic bank statement configuration.  This is only meant to discuss how to enhance the standard configuration.

Search strong configuration has two basic components- definition of the search string, and usage of the search string.

The search string configuration consists of a name, description, and the search string itself. 

 

In the ‘Name’ field type a description of what the searching string is identifying.


In the ‘Search String’ field, type the text as it appears on the bank statement.  This string is case sensitive and SAP matches character by character so if the bank may vary its text consider using the logical characters as defined in SAP.  (To display the definitions of the logical characters, click on the F1.)

Use the # sign to represent numbers 0-9.


The search string will automatically set up a mapping.  If you want to remove any of the characters in the mapping, they can be deleted from the mapping section.  For our example, even though we print 100008 on our check, our bank sends us 00100008 bank. Therefore, we need to remove the two leading zeroes.  This can be done by deleting the first two #’s signs in the mapping.  Then, once the interpretation runs on the bank statement, the 100008 number will be passed as the check number. Once the primary search string is set up, we can set up the search string use.


Here you decide how broadly the search string should apply.  Ask the following questions to determine the configuration needed:

· Is this used for a bank account on only one company code?

· Which House bank and account are associated with the check disbursement account?  Hint: this should exist in transaction FI12 as part of your original bank set-up.


Use the # sign to represent numbers 0-9.

 

The search string will automatically set up a mapping.  If you want to remove any of the characters in the mapping, they can be deleted from the mapping section.  For our example, even though we print 100008 on our check, our bank sends us 00100008 bank. Therefore, we need to remove the two leading zeroes.  This can be done by deleting the first two #’s signs in the mapping.  Then, once the interpretation runs on the bank statement, the 100008 number will be passed as the check number. Once the primary search string is set up, we can set up the search string use.

Here you decide how broadly the search string should apply.  Ask the following questions to determine the configuration needed:

·        Is this used for a bank account on only one company code?

·        Which House bank and account are associated with the check disbursement account?  Hint: this should exist in transaction FI12 as part of your original bank set-up.

·        What is the external business transaction code associated with checks.  For example, BAI code 475 may apply if your bank uses this code to identify checks.

·        +-  This should be for an outgoing payment.

·        Interpretation algorithm- there are three check algorithms.  For our example, the check number is different than the accounting document number in SAP.



Target Field: this is what is being changed as a result of the search string.  In our case, we are updating the check number as part of our mapping, so we select Check-/DME Reference- /Assignment Number.


Once we have finished and saved our set-up, our resulting search string for checking mapping looks like this:

Next, when we post the electronic bank statement via the FF.5 transaction, we would see the following:

 

Once the program has completed posting the bank statement, I can also see the check encashment date updated with the bank statement date:

And there you have it for this option: electronic bank statements optimized with search strings. Next time Option 2: Check encashment file will be explained.


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