1. Table of contents
Table of Contents maxLevel 3 minLevel 2
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Objective and Scope
Objective
This Local operational procedure (LOP) demonstrates processes and procedures to execute Accounts Receivable activities
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in Bank Draft posting for legal entities in CHINA. This LOP provides instruction for users to perform recurring activities and reacting expected scenarios.
Scope
This LOP applies for Accounts Receivable-Bank Draft
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posting of all CHINA entities:
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Solvay Specialty Polymers (Changshu) Co Ltd | 5991 |
Solvay Chemicals (Shanghai) Co Ltd | 6078 |
Solvay (Shanghai) Co Ltd | 5876 |
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Solvay Lantian (Quzhou) Chemicals Co Ltd | 5993 |
Solvay (China) Co Ltd |
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7728 | |
Solvay (Shanghai) International Trading Co Ltd | 6859 |
Solvay Fine Chemical Additives (Qingdao) Co Ltd | 7797 |
Solvay (Zhenjiang) Chemicals Co Ltd | 7811 |
Zhuhai Solvay Specialty Chemicals Co Ltd | 6577 |
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6875
Liyang Solvay Rare Earth New Materials Co Ltd | 6811 |
Solvay (Zhangjiagang) Specialty Chemicals Co Ltd | 6526 |
Solvay |
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6878
Hengchang (Zhangjiagang) Specialty Chemical Co Ltd | 7810 |
Cytec Engineered Materials ( Shanghai) Co Ltd | 7776 |
Cytec Industries ( Shanghai) Co Ltd | 7734 |
Reference Documents
Process Flow (shown in the process)
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Definitions
- SBS: In the current document, "Solvay Business Services" will be replaced by its abbreviation "SBS"
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- OP:
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- Operations Procedures
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- BD: Bank Draft
- AR: Accounts Receivable
- AP: Accounts Payable
- CSR: Customer Service Representative
- T-Code: Transaction Code (SAP)
- G/L: General Ledger
Process Flows
1. Posting for Bank Draft Receiving
After Bank Draft has been accepted through bank portal, AR record Bank Draft information in defined shared point, then clear Account Receivable and create Notes Receivable under the same customer account in SAP.
Step:
1. After received Bank Draft information, AR record it in defined shared point.
Definitions of each
Scope
China
ERP
References
Attachments
4. Process Flows
4.1 Maintain Bank Draft and Clear AR in RCS:AR–040-010
Overview of the tasks in this process:
AR Accountant (BO) check the Bank Draft copying, maintains Bank Draft that received from cashier. AR Accountant (BO) then clears AR and creates Notes Receivable under the same customer code in RCS.
Transaction code: F-36 and excel file
Step:
- Extraction all bank draft list from the bank portal and verify bank draft as per Treasury's policy.
- If Bank draft under qualify, AR process with business team to get extra approval. If Bank draft qualify, AR process acceptance process via Bank portal.
- Maintain Bank draft information in google sheet.
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column:
Customer name: Name of customer who pay by bank draft
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RCS code:
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Customer code in SAP
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Draft No.:
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Bank draft number (Copied from bank portal)
Issue Date:
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Date of issuing bank draft
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(Copied from
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bank
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portal)
Maturity Date:
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Date of cash collection (Copied from bank portal)
Maturity:
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Year and month of maturity date (Formulated by Excel)
Month:
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Actual age of bank draft
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(
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Counted from issue date to maturity date)
BD drawer:
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Bank draft issue bank (Copied from bank portal)
BD amount:
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Amount of bank draft
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(Copied from bank portal)
Comment:
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Status of cleared bank draft
Received date: Date of receiving bank draft
Period: Accounting period of receivable
Posting Date: Date of receiving and posting bank draft in SAP
Age: Age of bank draft on our hand
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(
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Counted from received date to maturity date
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)
Voucher number: Document posting number
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(Record receiving bank draft)
Clearing number: Document posting number
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(Record Bank draft
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collection,
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Transferring,
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Discount, Return)
GBU:
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Business unit that bank draft paid to (For defining profit center to be used)
2. Record bank draft receiving in SAP by using t-code F-36.
On the screen
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"Bill of Exchange Payment: Header
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Data",
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insert information in the required fields as below:
Document Date/Posting Date:
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The date of
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receiving bank draft
Type: "DW" representing Customer Bill Exchange
Company
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“First Line item Data”, enter information in the fields as below:
- PstKy: 09 is Special G/L debit is displayed by default
- Account: Enter the customer account.
- Special G/L Ind.: Enter the special G/L indicator:
- “9” is Bank Draft CN (< 3 months)
- “8” is Bank Draft CN (> 3 months)
Press “choose open item” go to the next screen.
code: 4 Digits representing the company
Currency: "CNY"
Reference: "REC. BD"
Doc. Header Text: BD's Issue Bank
Clearing text: "REC. BD" + Customer Name
Transaction to be processed: "Incoming payment" is default selected.
In the "First Line item", insert information in the required fields as below:
PstKy: "09" representing Special G/L debit (it is default displayed)
Account: Customer code
S GL Ind: The special G/L indicator "9" representing Bank Draft CN (< 3 months) or
"8" representing Bank Draft CN (> 3 months)
Press "Enter" to go to the next screen.
On the screen "Bill of Exchange Payment Add Customer item", insert information in the required fields as below:
Amount: The amount of bank draft
Assignment: Bank draft number
Bus. Area: The defined digits representing Business Unit (PF1 only)
Text: "REC. BD" + Customer Name, except Mortgage Bank Draft needs to insert "For Deposit"
Due on: The maturity date of the bank draft
Issue date: The date of issuing bank draft
Accepted: Select it when bank draft is unqualified and gets special approval
Payment Method: "$" (representing E-BD)
(The other fields are default and liked to customer master data, if customer bank information was added)
Credit entry requires to post as advance payment to customer account by putting the information in next line item as below,
PstKy: "19" representing Special G/L credit on Customer account
Account: Customer code
Special G/L Ind.: The special G/L indicator "A" representing Down payment
Press "Enter" to go to the next screen.
On the screen "Bill of Exchange Payment Add Customer item", insert information in the required fields as below:
Amount: Bank draft receiving amount
Tax code: "5M" (WP1) or "B0" (PF1)
Profit Center: The defined digits representing Business Unit (WP1 only)
Assignment: "REC. BD"
Text: "REC. BD" + Customer Name
Click "Document" and "Simulate" to check if credit and debit entries are balance.
Click "Post" 
and get the document number.
Remark: When document is posted as advance payment, it is required to clear the item against corresponding invoice in another step by using t-code F-32, please refer to Advance Payment Clearing Procedures.
2. Posting for Bank Draft's Cash Collection
When Bank draft is presented to the bank, there will be payment released to Solvay's bank account based on Bank Draft's maturity date and actual settlement amount. AR monitor the payment through bank statement, then record incoming payment in Bank G/L Account and clear Notes Receivable recorded earlier in SAP.
Step:
1. AR download and monitor bank statement on a daily basis, then check if there is incoming payment received from bank draft collection.
Bank Draft collection would present Bank Draft number in bank statement as a reference.
Example of Bank Statement with Bank Draft Collection:
2. Check and find corresponding document that recorded bank draft receiving earlier via t-code FBL5N.
Corresponding document can refer to bank draft number inserted in "Assignment" field, it is supposed to be the same bank draft number shown in bank statement.
3. Record bank draft collection in SAP by using t-code FEBA.
On the screen "Edit Bank Statement", double click on payment transaction in the left-hand side to display payment details in the right-hand side:
Click "Post" 
to record the payment and select open item or bank draft to be cleared.
In the "Open item selection":
Company Code: 4 Digits representing the company
Account: Customer code
Account type: "D" representing Customer Account
Special G/L ind: "8" or "9"
Then select "Document Number" in the "Additional selections".
Click "Process open items" and insert document number that posted as received bank draft earlier.
Click "Process open items" to clear cash-collected bank draft.
Click "Post" and get the document number.
3. Posting for Bank Draft Discounting
Bank Draft Discounting is to early submit Bank Draft to the bank, in order to get the payment before its maturity date, but company needs to pay interest charges to the bank. It is basically managed by Treasury Cooperate team.
Step:
1. AR download and monitor bank statement on a daily basis, then check if there is incoming payment received from bank draft discounting. Sometimes Treasury Cooperate team would provide information in advance.
Bank Draft Discounting would have large amount of incoming payment with specific wording in bank statement.
Example of Bank Statement with Bank Draft Discounting:
2. Prepare Discounted Bank Draft list in Shared file.
3. Record incoming payment, interest charges and clear Notes Receivable in SAP by using t-code F-30. 
Document Date/ Posting Date: The date of receiving payment
Type: "DA" (WP1) or "DZ" (PF1) representing Customer document
Company code: 4 Digits representing the company
Currency: "CNY"
Reference/ Doc.Header Text/ Clearing text: "BD DISCOUNTING"
Transaction to be processed: "Transfer posting with clearing" is default selected.
In the "First Line item Data", insert information in the required fields as below:
PstKy: "40" representing Debit entry G/L
Account: G/L account of the bank account that receive payment
Press "Enter" to go to the next screen.
Amount: The amount of incoming payment
Value Date: The date of receiving payment
Text: "BD DISCOUNTING"
Click "Choose open item" to go to the next screen.
In the "Open item selection", enter account information that Bank Draft is recorded on,
Company code: 4 Digits representing the company
Account: Customer code
Account Type: "D"
Special G/L Ind.: "8" or "9"
Then click "Process open items" to select open item. (Clear discounted bank draft)
Generally bank would charge company discounting interest, AR needs to book the interest charged amount into the defined G/L account.
In the "Other Line item Data", insert information in the required fields as below:
PstKy: "40" representing Debit entry G/L
Account: Enter 98536240 (WP1) or 6599000000 (PF1) which is G/L account for other financial expenses
Press "Enter" to go to the next screen.
Amount: The amount of charged interest
Cost center: The defined digits representing CBNR Cost Center
Text: "BD DISCOUNTING"
Click "Post" and get the document number.
4. Posting for Bank Draft Transferred to Vendor
Transferring Bank Draft to Vendor is requested when AP and Site Controller agreed to use Bank Draft as a payment to vendor on a regular basis. After received a request, AR clear Notes Receivable recorded earlier in SAP and clear or post on Account Payable.
Step:
1. When Site Controller and AP agree to make payment to vendor by using Bank Draft, AP is accountable to prepare and send all information to AR. Then AR review and record Bank Draft list in the inventory file.
2. Record and clear Notes Receivable in SAP by using t-code F-36.
Document Date/Posting Date: The date of receiving request to transfer bank draft
Type: "DW" representing Customer Bill Exchange
Company code: 4 Digits representing the company
Currency: "CNY"
Reference: "TRF. BD to AP"
Doc. Header Text/ Clearing text: "Transfer to Vendor" + Vendor Name
Transaction to be processed: "Incoming Payment" is default selected.
In the "First Line item Data", insert information in the required fields as below:
PstKy: "29" representing Special G/L debit for Vendor account
Account: Vendor code
Special G/L Ind.: The special G/L indicator "A"
Press "Enter" to go to the next screen.
Amount: The total amount of transferred bank draft
Tax Code: "JP"
Assignment: "TRF. BD to AP"
Text: "Transfer to Vendor" + Vendor Name
Click "Choose open item" to go to the next screen.
In the "Open item selection", enter account information that Bank Draft is recorded on,
Company code: 4 Digits representing the company
Account: Customer code
Account Type: "D"
Special G/L Ind.: "8" or "9"
Click "Process open item" to go to the next screen. And select open item to clear. (Clear transferred bank draft)
Click "Post" and get the document number.
3. If vendor reject or return bank draft back to our company, there are 2 options to post the document
Option 1 : AR reverse the document that posted for transferring bank draft earlier by t-code FB08.
Insert information in "Document Details" and "Specifications for Reverse Posting", then click "Post" and get document number.
Option 2 : AR repost Note Receivables (refer to Posting for Bank Draft Receiving) and create debit entry on vendor account by using t-code F-36.
After repost Notes Receivable, insert information in the required fields of "Next Line Item" as below:
PstKy: "31" representing Debit entry on Vendor account
Account: Vendor code
Press "Enter" go to the next screen.
Amount: The total amount of returned Bank Draft
Payt Terms: Please remove it
Assignment: "BD Return"
Text: "BD Returned from Vendor" + Vendor Name
Click "Post" and get the document number.
Remark: WP1 document requires to update "Profit Center" via t-code "ZWFA111".
5. Posting for Bank Draft Returned/Exchanged to Customer
Bank Draft is mostly returned when it is used as "Mortgage Bank Draft" and be requested to return back to customer. And sometimes when we receive huge amount of Bank Draft, customer would request us to give the change in smaller amount of Bank Draft, it is usually called "Exchange Bank Draft" or transfer Bank Draft to customer.
Step:
After received request and approval, AR or Cashier transfer Bank draft through bank portal, then AR follow below procedures to perform the posting.
1. Open t-code FBL5N to check bank draft and AR balance;
For "Mortgage Bank Draft", both debit entry (Notes Receivable) and credit entry (Accounts Receivable) should have the same amount and be posted in the same document.
2. Clear bank draft and Account Receivable in SAP;
2.1. Use t-code F-32 for clearing returned bank draft.
Account/ Company Code: Customer code and Company code that the Bank Draft is recorded on
Clearing date/ Period: The date of returning bank draft
Currency: "CNY"
Special G/L Ind: "A" and "8" or "9"
Click "Process open items" to go to the next screen.
Select open item to be cleared by clicking on the item amount.
Click "Post" and get the document number.
2.2. Use t-code f-36 for clearing exchanged bank draft.
Document Date/Posting Date: The date of transferring bank draft
Type: "DW" representing Customer Bill Exchange
Company code: 4 Digits representing the company
Currency: "CNY"
Reference: "TRF. BD to CUST."
Doc. Header Text/ Clearing text: "Transfer to Customer" + Customer Name
Transaction to be processed: "Incoming Payment" is default selected
Click "Choose open item" to go to the next screen.
In the "Open item selection", insert account information that Bank Draft is recorded on,
Company code: 4 Digits representing the company
Account: Customer code
Account Type: "D"
Special G/L Ind.: "8" or "9" and "A" or any credit entry on Account Receivable
Click "Process open item" to go to the next screen. And select open item to clear. (Clear transferred bank draft and Account Receivable)
Click "Post" and get the document number.
2. On the screen: “Bill of Exchange Payment Customer item”, enter information in the fields as below:
- Amount: Enter the amount of bank draft.
- Assignment: Bank Draft Number
- Text: Same as "Doc. Header Text".
- Due on: The Maturity date of the bank draft.
- Issue date: Date of issue Bank Draft
Then For Option 1 if need to clear AR choose " Process open item " button.
Option 2 In AR-BO practical we post as advance incoming to customer account first.
Thus we will put the information in next line item.
- PstKy: 19 is Special G/L credit
- Account: Enter the customer account.
- Special G/L Ind.: Enter the special G/L indicator: "A" is Down payment
Press "Enter" go to the next screen.
"The warning screen, it won't be shown every time. It will be reminded that credit limit is exceeded for this account, ignore it."
On the next screen for option 1: "Bill of Exchange Payment Select open items", enter information in the fields
Then process open item screen show as below to select open item to match with received bank draft amount.
Even if cannot match the amount we can choose the item and leave outstanding by partial or residul item.
For China, invoice that can be choose need to have Fa Piao (Gloden Tax number) in reference key1 feild.
Press "simulate" to check all entry G/L
Once we choose the residual item, on overview Screen line item of outstanding amount will show in "blue" for enter the detail.
Then enter Payment term, Bline date: refer from original invoice.
And Text: Residual-invoice number
Clicks “save” to post the document and get the document number.
On the next screen for option 2: "Bill of Exchange Payment add Customer item", enter information in the fields as below:
Press "simulate" to check all entry G/L
Press "Save" to post the document.
The document number will be shown on the bottom of the screen.
4.2 Clearing Bank draft
AR Accountant (BO) clear bank draft record when bank draft following below:
- Bank draft due , Local Cashier submit to local bank and get the money to bank account
- Transfer bank draft to Vendor, PtP team and Local Cashier agreed to pay vendor by customer's bank draft receiving.
- Bank Draft Discount, Local Cashier agrees with local bank to get the money before bank draft due by interest charges.
Transaction code: F-36 and F-30 and Excel file
In the event of Bank draft due and bank draft discount, clearing bank draft record in system by T-Code F-30 document type DA.
Step:
Bank Draft Due is Bank Draft submitted bank to get the money.
Bank Draft Discount is Bank Draft submitted bank to get the money before maturity date with interest charges.
Check statement and get information from Local cashier and/or Treasury Team
From AR-BO download and monitor bank account statement by daily basis.
Once we have incoming about bank draft due and/or bank draft discount.
Example statement file and Bank draft inventory file.
Bank Statement
Bank Draft due
Bank Draft Discount
Bank Draft inventory file
Bank Draft due
Bank Draft Discount
Posting and clearing in SAP by F-30 document type DA.
- Document Date: Enter the date of the accounting document.
- Type: "DA" is Customer document
- Company Code/ Currency/Rate: Enter information about bank draft
- Reference/ Doc. Header Text: Enter a text that will be displayed on all of the lines for this posting.
- Transaction to be processed: “Transfer posting with clearing” is displayed by default.
“First Line item Data”, enter information in the fields as below:
- PstKy: 40 is Debit entry G/L
- Account: Enter the GL bank account.
Press “Enter” go to the next screen.
- Amount: Enter the amount of bank incoming.
- Value Date: Default by system.
- Text : Same as "Doc. Header Text".
Presses "Choose open item" go to the next screen.
Then process open item screen to select open item.(Choose bank draft which Due / dicounted)
Press “simulate” to check all entry G/L
And discount case,Bank would charge interest to company. AR-BO would post interest to expense G/L
"Other Line item Data", enter information in the fields as below:
PstKy: 40 is Debit entry G/L
Account: Enter the GL other financial expense.
Amount: Enter the amount of bank interest.
Cost center: Default by system.
Text: Same as "Doc. Header Text".
Press "simulate" to check all entry G/L
Clicks "save" to post the document and get the document number.
Document sample for Bank draft Due
Document sample for Bank draft Discount
In the event of Transfer bank Draft to Vendor, clearing bank draft record in system by T-Code F-36 document type DW.
Transfer bank draft to Vendor is PtP team and Local Cashier agreed to pay vendor by customer's bank draft.
Step:
Local cashier and PtP agree to pay vendor by customer bank draft. (Which bank draft to pay, what vendor code, is concerning project?)
PtP send all information with approval's Authorizer.
Bank Draft inventory file
Posting and clearing in SAP by F-36 document type DW.
Document Date: Enter the date of the accounting document.
Type: "DW" is Customer Bill Exchange.
Company Code/ Currency/Rate: Enter information about bank draft
Reference/ Doc. Header Text: Enter a text that will be displayed on all of the lines for this posting.
Transaction to be processed: "Incoming Payment" is displayed by default.
"First Line item Data", enter information in the fields as below:
PstKy: 29 is Special G/L debit for Vendor
Account: Enter the Vendor account
Special G/L Ind.: Enter the special G/L indicator: "A" is Down payment.
"M" is Down payment for Tangible Asset.
Press "Enter" go to the next screen.
Amount: Enter the amount of Bank Draft Transfer.
Purch.Doc: PO number, PtP inform
WBS Element: Cost center of project, PtP inform.
Text: Same as "Doc. Header Text".
Presses "Choose open item" go to the next screen.
Presses "Process open item" go to the next screen.
Select open item to clear.
Then press "simulate" to check all entry G/L
Clicks "save" to post the document and get the document number
Document sample for Transfer Bank draft to Vendor
4.3 Bank Draft Stocktaking (Bank Draft Reconciliation)
AR Accountant (BO) reconcile bank draft inventory after month end closing. To declare movement and balancing of bank draft by cross check with G/L account on monthly basis.
Transaction code: FS10N and Excel File
Record movement of bank draftStep: During month once we have movement about bank draft, AR-BO keeps all movement, historical of each bank draft by comment, document number and clearing document.
After monthend closing ,AR-BO do bank draft reconciliation.
Show movement bank draft processing and reconcile with GL account in SAP.
Use T-Code FS10N to check balancing of GL account of each month for reconcile bank draft balancing.
On screen FS10N ,enter G/L account number , company code and Fiscal Year and click execute.
Then reconcile balancing against cumulative balance of G/L account by monthly.
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