Bank /Cash definition – An overview

Introduction

Bank and Cash are the life and blood of any organization. Effective management of bank/cash is the key to survival of any business. Transactions transcending geographical and economic barriers have necessitated maintaining different bank accounts in different currencies.

The Bank Master contains the complete details of all the bank accounts held by the company for the purpose of internal transfers between different bank accounts or for depositing receipts. 

It also contains the bank account details of the suppliers, to directly make payments due to them by the company. A company can make payments either by issuing an instrument or by transferring funds electronically, directly into the supplier’s account.  The instrument used for the payment can be a check, draft or pay order.

The cash accounts are defined in the Cash Master. It contains the details of the various cash accounts and the currency in which each of the cash accounts are maintained.

Feature Highlights

• The component has provision to capture the following details:

• The bank name, address, contact person/s in the bank and the department  they belong  to, the  phone number  of the bank and  also each  person’s contact number, their email ID, fax number, etc.

• The clearing number as defined by the central bank of the country and also the ‘SWIFT’ number  of the bank. 

This information will be necessary for file transfer of payments and receipts. Whether, the bank is a foreign bank is also defined.

• In case of Swiss companies, the Swiss Specific File Transfer details.

• The drawable limit, credit limit , bank charges and interest rate for varied accounts are also maintained bank wise

• A company can have many bank accounts for its transactions. A user can define separate bank accounts and unique bank codes to identify the unique bank accounts.

• Each bank code is mapped to a bank reference and also to a posting account number that is defined in the chart of accounts. This posting account number is mapped to a particular finance book. Hence, if transactions are to be performed in one particular bank account then the entries are passed in the mapped posting account number, which in turn affects the particular finance book.

• Assigning an individual posting account number to each bank code facilitates easy identification of the bank in which the transactions take place and also to make bank reconciliation easier.

List of Activities