Hello Colleagues,
With this blog post, I would like to explain how to process the Bill of Exchange - sole payment method.
I have an Open item of KRW 300.000.000 with my customer
Now to clear this open item with Bill of Exchange - sole payment method.
Go to Payment Management -> Payment Monitor
Click on -> "New Payment By"
from the drop-down select "BoE Rec. Sole Bill"
In customer Account, You can see the Invoice has been cleared with the Bill of exchange sole bill payment
In payment monitor
To download the Output file
Go to Liquidy Management -> Outbound Files
you click on Download icon to download the file.
Now you need to get the payment from the bank
so, While processing your bank statement to you need to select you Bill of Exchange Deposit,
Go to Liquidity management -> New Bank statement
Provide the relevant bank account in which you have the bill of exchange transactions.
in Bank statement selection screen you need to select Bill of Exchange Deposit.
And post the Bank statement.
Journal entry of the bank statement
in payment monitor, the status will change to "confirm"
Let me show you the Bill of Exchange payment without any reference and how to clear it with an invoice
From Payment Monitor, create a new bill of exchange.
Journal entry posted when you release the BoE
In customer Monitor
The Bill of Exchange will be created as an On Account payment.
In Payment Monitor.
Post-processing is shown as Required
To clear the On Account Payment you can click on Required
It will go to Clearing Overview screen
the system will suggest an invoice if the amount is matching with any invoice
Click on "View All"
As you can see I have not selected any reference invoice, so I can select any invoice and clear full or partial amount.
to clear you have select "Clear"
Journal entry posted when you cleared the Invoice with BOE
Let me show you the Bill of Exchange payment With reference & Discount and how to clear it with an invoice
From Payment Monitor, create a new bill of exchange.
Journal entry posted when you release the BoE
In customer Monitor
The Bill of Exchange will be created as an On Account payment. Also, you can a see Invoice has a Clearing ID
This is an On account with reference. You can Check the Document Flow you will find a Business task. which ask you ask you to Review and Clear
In Payment Monitor.
Post-processing is shown as Required
Click on Required.
It will go to Clearing Overview screen,
the open Item is assigned to BoE On Account payment and has a discount.
Click on "View All"
Journal entry posted when you clear the Invoice with BoE
Below is the list of journal entry posted in Bill of Exchange process
Most frequent question asked to me
Why does Bank - Bill of exchange Liability(collection) and Bill of Exchange (Collection) have balance?
As you can see from the Above table GL Type is Different for the two Gl account, while Configuring we have to Make Two separate GL for Collection Clearing GL account. The value doesn't affect the Balance sheet as both are asset Gl Account and these Gl account will cancel each other.
This is the process of Bill of exchange Receivables for Korea.
Regards,
Dheeraj
With this blog post, I would like to explain how to process the Bill of Exchange - sole payment method.
I have an Open item of KRW 300.000.000 with my customer
Now to clear this open item with Bill of Exchange - sole payment method.
Go to Payment Management -> Payment Monitor
Click on -> "New Payment By"
from the drop-down select "BoE Rec. Sole Bill"
Provide the payment information
Select the Relevant bank account in which, you have maintained the conditions agreed for your bill of exchange transactions.
As I want to clear the Invoice: "Inv-21" amount: "KRW 300.000.000".
Under the Reference tab, click on "Add Row" and manually enter- Invoice id, Document date and Invoice amount.
Then You can Click on "Release" to post the Bill of exchange sole bill Payment.
once you release the Bill of exchange a journal entry is posted
| GL account | Debit | Credit |
| Bill of exchange receivable | 300.000.000 | |
| Account receivable | 300.000.000 |
In customer Account, You can see the Invoice has been cleared with the Bill of exchange sole bill payment
In payment monitor
as you see the status is "Ready to deposit" and post-processing is "not relevant".
we need to assign the bill of Exchange to Bill of exchange Deposit.
Select the line item
Click on Action for BoE.
Click on Assign to Deposit.
You choose the BoE Deposit type, which signifies that the bank will collect the bill of exchange.
Here I am selecting Collection as deposit type.
after assigning to Bill of exchange deposit, the status of Document changes to Ready to Transfer.
To send the deposit to the bank, you first need to release it.
Go to Payment management -> Bill of exchange deposit
you will be able to see the Bill of exchange assigned to the Bill of exchange deposit
to release the Bill of exchange Deposit
Click on Action
Click on Release
Select the Deposit File format and Click on "OK"
Now the Deposit file is released. Thus creating a payment file and triggering an accounting entry.
Journal entry
| GL account | Debit | Credit |
| Bank - BOE (incoming payment) | 300.000.000 | |
| Bank - Bill of exchange Liability(collection) | 300.000.000 | |
| Bill of Exchange (Collection) | 300.000.000 | |
| Bill of Exchange Receivable | 300.000.000 |
To download the Output file
Go to Liquidy Management -> Outbound Files
you click on Download icon to download the file.
Now you need to get the payment from the bank
so, While processing your bank statement to you need to select you Bill of Exchange Deposit,
Go to Liquidity management -> New Bank statement
Provide the relevant bank account in which you have the bill of exchange transactions.
in Bank statement selection screen you need to select Bill of Exchange Deposit.
And post the Bank statement.
Journal entry of the bank statement
| GL account | Debit | Credit |
| Bank - BOE (incoming payment) | 300.000.000 | |
| Bank Account | 300.000.000 |
in payment monitor, the status will change to "confirm"
Let me show you the Bill of Exchange payment without any reference and how to clear it with an invoice
From Payment Monitor, create a new bill of exchange.
Provide the payment information
Relevant bank account in which you have maintained the conditions agreed for your bill of exchange transactions should be selected here.
Here I didn't provide any reference and release the payment
Journal entry posted when you release the BoE
| GL account | Debit | Credit |
| Bill of Exchange Receivable | 60.000.000 | |
| Account receivable | 60.000.000 |
In customer Monitor
The Bill of Exchange will be created as an On Account payment.
In Payment Monitor.
Post-processing is shown as Required
To clear the On Account Payment you can click on Required
It will go to Clearing Overview screen
the system will suggest an invoice if the amount is matching with any invoice
Click on "View All"
As you can see I have not selected any reference invoice, so I can select any invoice and clear full or partial amount.
to clear you have select "Clear"
Journal entry posted when you cleared the Invoice with BOE
| GL account | Debit | Credit |
| Account receivable | 60.000.000 | |
| Account receivable | 60.000.000 |
Let me show you the Bill of Exchange payment With reference & Discount and how to clear it with an invoice
From Payment Monitor, create a new bill of exchange.
Provide the payment information
Relevant bank account in which you have maintained the conditions agreed for your bill of exchange transactions should be selected here.
Under the Reference tab, "Add row
Provide an Invoice ID.
Provide the Discount Amount
Provide the Gross amount, Gross amount is the Invoice Amount.
Payment Amount is the remaining balance.
release the payment
Journal entry posted when you release the BoE
| GL account | Debit | Credit |
| Bill of exchange receivable | 600.000.000 | |
| Account receivable | 600.000.000 |
In customer Monitor
The Bill of Exchange will be created as an On Account payment. Also, you can a see Invoice has a Clearing ID
This is an On account with reference. You can Check the Document Flow you will find a Business task. which ask you ask you to Review and Clear
In Payment Monitor.
Post-processing is shown as Required
Click on Required.
It will go to Clearing Overview screen,
the open Item is assigned to BoE On Account payment and has a discount.
Click on "View All"
Journal entry posted when you clear the Invoice with BoE
| GL account | Debit | Credit |
| Account receivable | 700.000.000 | |
| Account receivable | 600.000.000 | |
| Discount | 100.000.000 |
Below is the list of journal entry posted in Bill of Exchange process
| GL account | Gl account type | Debit | Credit |
| Bill of exchange receivables | Receivables | 300.000.000 | |
| Account receivables | Receivables | 300.000.000 | |
| Bank - BOE (incoming payment) | cash | 300.000.000 | |
| Bank - Bill of exchange Liability(collection) | cash | 300.000.000 | |
| Bill of Exchange (Collection) | Receivables | 300.000.000 | |
| Bill of Exchange Receivable | Receivables | 300.000.000 | |
| Bank | cash | 300.000.000 | |
| Bank - BOE (incoming payment) | cash | 300.000.000 |
Most frequent question asked to me
Why does Bank - Bill of exchange Liability(collection) and Bill of Exchange (Collection) have balance?
As you can see from the Above table GL Type is Different for the two Gl account, while Configuring we have to Make Two separate GL for Collection Clearing GL account. The value doesn't affect the Balance sheet as both are asset Gl Account and these Gl account will cancel each other.
This is the process of Bill of exchange Receivables for Korea.
Regards,
Dheeraj
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