Technical Articles
Bill of Exchange – Sole Bill for Korea
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”
| 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
| 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.
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.
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