BAI2 Format for Lockbox

March 26, 2018 | Author: Sekhar Katta | Category: Cheque, Electronic Data Interchange, Payments, Invoice, Financial Transaction


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BAI2 Format for LockboxPurpose The purpose of this page is to clarify the understanding of the BAI2 format for lockbox, such as characters and segments of the file. Overview A wider knowledge about the file structure you are uploading to your SAP ERP allows you to avoid many problems those looks like to be application issues. In the following sections you will be able to understand better the BAI2 structure. BAI2 Structure  Record 1 - Header  Record 2 - Service  Record 5 - Detail Header Record  Record 6 - Detail Record  Record 4 - Overflow Record  Record 7 - Batch Total Record (Some banks process groups of checks in batches)  Record 8 - Lockbox Total Record Trailer Record Detailed information regarding each record can be found through Transaction Code SE11:  FLB01 . Record 9 .Header  FLB02 .Service .  FLB05 .Detail Header Record .  FLB26 .Overflow Record .Detail Record  FLB24 .  FLB07 .Batch Total Record  FLB08 .Lockbox Total Record . Trailer Record . FLB09 . BAI2 splits the check total into separate invoice references and associated payment amounts. The company then informs their customers that all open item payments for their accounts must be submitted to one of the established bank lockbox accounts. within a large batch. These files are typically transferred nightly to the various lockbox owners (companies). As a result. In these scenarios.Concept of Lockbox Purpose This page is intended to explain the basic characteristics of Lockbox Overview A company can create accounts called 'lockbox' at its bank (or banks) that act as payment collection accounts for customer payments. the entire check will enter into SAP as: an "On account" posting (if the payment and invoice totals don't match). Data entry clerks at the bank manually enter the information into an electronic file for transmission to the company to which the lockbox account belongs. your Accounts Receivable cash application clerks will have to perform manual application to clear payments against open items on the proper accounts. the entire check amount must match perfectly (or within configured payment difference tolerances) the total amount for all invoices listed. or An "Unprocessed" posting (if no customer account and documents could be identified from the transmission). your 'hit rate' percentage of payment-invoice matching from each transmission is likely to be higher when using BAI2 rather than BAI formats. others will land on account. in BAI format files. The bank collects these payments along with the customers' remittance information that indicates what open items the customer payments intend to clear. Thus. Instead. one check total amount simply has all invoices listed underneath it. Otherwise. The files adhere to one of two standard banking industry transmission formats: BAI. BAI2 (Bank Administration Institute). Conversely. Easy reconciliation Clearing Errors can be avoided Difference between BAI and BAI2 BAI and BAI2 formats differ in their level of information detail. BAI does not separate out the incoming check line items by invoice subtotal reference. Thus. Advantages of Lockbox Following are some of the advantages of using the lockbox: Manual Handling of checks can be avoided Checks can be processed in time. BAI2 format files will allow a "Partially applied" status in which some identifiable payments within the check total will be matched and cleared. . accurate payment data is necessary for automatic clearing to take place. . Therefore. Payment amounts and other information.Partially Applied: Checks that are partially applied may require further processing. Payment advice processing  Matching of customer open items The lockbox program uses detailed information from the payment advice to automatically search and match customer open items. create a data file of the customer remittance information and payment amounts.  Payment Advice Status If the checks were applied or partially applied. On regular basis. Customer name. and deposit the checks into client bank account. Customer MICR number ( Bank routing and Account Number). If the check was unprocessed or placed on account of customer. the advice is kept on file for further processing. The server translates the message using as standard EDI interface into an IDOC (Intermediary documents) and sends it to the SAP Server. User must manually clear any checks that were on-account of customer or not applied to customer account. . the lock box file will contain information viz. . the post process function clears the open item. Invoice number. Customer Number. deletes the payment advice and sets the check status to applied. invoice numbers and customer number. The first 4 invoices would clear. the Lockbox Import Program posts the payment on account. but one was incorrectly keyed.  What is the Lockbox Data Flow? Customers send their payments to a lockbox. Depending on the status of the check. Then bank collects the data and sends (either through EDI 820 and 823 formats) to R/3 users EDI server (standard Process). a program is clicked (RFEBLB30 or FLBP transaction) to check the information stored in bank statement tables and create payment advices with Payment amount.  What happens in SAP server? Once the message is received and stored in SAP table. The Lockbox overview screen details the number of checks in each category. Ex: Check may have paid 5 invoices.. In the post processing step. the advice is deleted from the system after processing. Payment date.  Post Processing The post process function entails reviewing the status of the checks applied through the lock box function. Check amount.FAQ  What Bank will do? Bank Receives the payments. the user determines what needs to occur to apply checks. Client company receives this data file for processing to update in their accounts.On account: If the bank keyed in the correct invoice number. The payment amount for the 5th invoice would be put onaccount and would have to be post processed to clear.  What lockbox data file contain? Depending upon the choice of services with the Bank. you access the payment advice and correct the document number and upon saving the changes. The document number on the payment advice is matched against the document number in the customer open item file. I also expected to go to FLB1 and find only the invoice that was previously cleared.Define Lockboxes for House Banks SAP IMG -> Financial Accounting -> Bank Accounting -> Bank accounts -> Define Lockboxes for House Banks 3. .Define Posting data SAP IMG -> Financial Accounting -> Bank Accounting -> Business Transactions -> Payment Transactions -> Lockbox -> Define Posting data After preparing the lockbox file (for test purpose) execute the following transaction to test the lockbox configuration: FLB2: Import Lockbox File FLB1: Post-processing Lockbox Data Where in the CONFIG does it impact achieving the Partially Applied status? I am doing testing and I cannot get this status. Once the payment is researched and the customer and invoice is identified. I must have that configured wrong. Configuration 1. Please advise. There is also a help ticket opened with some company with SAP but no resolution yet.Define Control Parameters SAP IMG -> Financial Accounting -> Bank Accounting -> Business Transactions -> Payment Transactions -> Lockbox -> Define Control Parameters 4. In the case of having one invoice previously cleared and the other open and match at the dollar amount. it would be applied during post processing. I have searched the forum for over 4 hours and it appears to be a problem that none has found a resolution. I am seeing both of them! Does it have something to do with the payment advice? If so.Unprocessed: Any payment that could not be identified either by customer MICR number (check) or the document number would remain Unprocessed.Define House Banks SAP IMG -> Financial Accounting -> Bank Accounting -> Bank Accounts -> Define House Banks (Transaction Code: FI12) 2.. I expected it to give me a status of Partially Applied.
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