cash management & liquidity forecast
DESCRIPTION
Cash ManagementTRANSCRIPT
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Cash Position & Liquidity Forecasting
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SAP Cash Management
SAP AG
Problems and Objectives
1. Ensuring optimum liquidity formaturing obligations
2. Preparing and transferring short,medium and long-term funds atmaturity
3. Control over incoming and outgoingpayments
4. Information on managing short-termcash investments or borrowings
1. Too many bank accounts
2. Accounting by value date is required
3. Unreliable planning tools
4. Investment instruments not used totheir fullest potential
5. Lack of payment strategy
ConclusionConclusionAll necessary information must be
accessible in the cash management system.
Business ObjectivesBusiness ObjectivesCurrent ProblemsCurrent Problems
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Business BenefitsPurchasing SalesCash Management
Improve cash forecasting
Manage credit exposure by credit partner
Reduce dispute costs
Streamline payment process
Reduce time and cost to review and pay invoices
Improve account & invoice reconciliation
Control the timing of payments and management of outbound cash flow
Take advantage of discount terms
Tight integration between A/P, A/R, G/L, MM, SD
Business View – Cash Management
Purchase Order
Cash Position
Liquidity Analysis
Sales OrderSales Order
Invoice
Payment
InvoiceInvoice
Account Statement
PaymentPayment
Cash Concentration
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FunctionsSAP Cash Management – reflects all cash-related transactions entered in SAP, such as purchase order, sales order, accounts payable, accounts receivable, and bank accounts.
Cash position – proof of position report. Shows bank accounts and expected incoming and outgoing cash. It presents a short-term cash position view of up to one week.
Liquidity forecast – cash forecast report. Interface with other SAP components, such as SD and MM, to show
expected future cash flow. It presents a mid-term liquidity view for up to 24 weeks.
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Cash Management
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SAP Cash Management - Reporting
Cash Position Liquidity Forecast
Bank accountsBalances
Cashin transit
Investments, Debt and Hedging
Operations
Trading
LiquidityLiquidityManagementManagement
Market information
Managing external cash balances and obligations Multi-Bank simplification and standardization Drill down functionality
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Cash Management
SAP AG
Tools
InstrumentInstrument DataData Time FrameTime Frame
1.1. Cash management Cash management positionposition -- bank accountsbank accounts -- by value date by value date -- bank clearing accts bank clearing accts 0 to 5 days 0 to 5 days
-- payment advices payment advices
2.2. Liquidity forecastLiquidity forecast-- projecting cash projecting cash -- accounts receivableaccounts receivable inflows/outflows inflows/outflows -- accounts payableaccounts payable 1 to 24 weeks1 to 24 weeks-- taxes taxes -- FI, MM, SDFI, MM, SD -- planned itemsplanned items
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Cash Management
SAP AG
Features
ØØ Bank balances by value dateBank balances by value date
ØØ Parallel management of foreign currenciesParallel management of foreign currencies
ØØ Automatic revaluationsAutomatic revaluations
ØØ Cash position covering the next few daysCash position covering the next few days
ØØ Automatic payment using expected value daysAutomatic payment using expected value days
ØØ Control over cashed checksControl over cashed checks
ØØ Liabilities for down paymentsLiabilities for down payments
ØØ Individual planningIndividual planning
Cash Management PositionCash Management Position
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Liquidity Forecast
SAP AG
Features
Projecting receipts and disbursements from FI, SD, MM, andTM
Individual planning and planned items
Automatic maintenance (reversal, document change)
Customer payment behavior included in the forecast
Grouping by planning groups
Additional information (blocked items, special G/Ltransactions)
Currency exposure taken into account
Variable breakdown of planned items (days, weeks, months)
Liquidity ForecastLiquidity Forecast
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Cash Management
SAP AG
R
Overview of the Functionality
Cash PositionCash Position Liquidity ForecastLiquidity Forecast
-- Up-to-date bank account Up-to-date bank account -- Link to all system resident dataLink to all system resident datapresentation as well as by presentation as well as by (for example, open items)(for example, open items)value date value date
-- Forecasting daily liquidity Forecasting daily liquidity -- Projecting receipts and Projecting receipts and disbursements over a time framedisbursements over a time frame
-- Input facilities prevent dataInput facilities prevent data -- Facilities for optimizing investingFacilities for optimizing investingduplicationduplication and borrowing cashand borrowing cash
-- Documentation and revisionDocumentation and revision -- Ensuring company liquidityEnsuring company liquiditycapabilities for all planningcapabilities for all planning transactionstransactions
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Groups and Levels
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Example Cash Position
Summary report level
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Drilldown to cash management accounts
Example Cash Position (cont.)
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Drilldown to cash flow sources
Example Cash Position (cont.)
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Steps1. Define Value Date Default 2. Define Source Symbols ( Check only)3. Define Account Groups ( Check field status group of Cash
accounts for Planning Level ) – OT374. Define Planning Groups ( Z1, Z2 – Domestic payments,
Foreign payments ; X1,X2 – Domestic Customers, Foreign Customers)
5. Define Planning Levels 6. Define Cash Management Account Name7. Define Groupings and Maintain Headers8. Maintain Structure9. Activate Cash Management (in Enter Global Parameters)10. Define Planning Levels for Logistics ( Check only)11. Prepare Production Start up - FDFD12. Define Number Ranges for Manual Planning – OT20
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