Financial Account

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Introduction

A Financial Account represents an account at a financial institution such as a bank account, a credit card issuer, an electronic payment service, as well as a cash or petty cash register.

Openbravo allows to create as many Financial Accounts as required by the organization in the financial account window which therefore is used to record monetary transactions such as invoice payments, bank fees, credit card charges, etc.

Payment obligations and amounts due from customers are created in the Purchase and Sales invoice windows. Collections from customers and payments to suppliers for these invoices, however, are normally recorded in the Financial Account window or in the Payment In and Payment Out windows.

It is very important to properly define every parameter of each Financial Account. During your Financial Account setup process, you will need information like: the bank account information, the payment methods allowed, the bank account currency/ies, the accounting information, etc. Have a look at Financial Account Screen Reference in order to collect all needed information.

Account

The financial account window contains essential information such as the bank account number and allows to perform a set of processes such as to add deposit or withdrawal transactions to the financial account or to import and match a bank statement file.

The essential financial account information to be filled in the top section of the financial account window is:

• The Name and a Description of the account.
• The Currency of the account
• The account Type: There are two account types: Bank and Cash.
  Depending on the type selected the required information to enter changes. There is no need to fill in the bank account information if the account type selected is "Cash".
  It is possible to define additional account types by extending the List Financial Account Type.
• Whether this is the Default account to be used in transactions or not. When invoices, orders and other documents including a Financial Account are created, this will be the one shown by default.
• The Business Partner associated to this bank account. For example, the Financial Institution holding the account. This information is used for accounting purpose. Location address related to the business partner is just visual information, loaded when the business partner is selected.
• The Initial Balance: In most cases the business is already up and running at the time Openbravo is implemented. This field allows to initialize the initial balance of each Financial Account by providing real balance of the cash / bank account as it was on a date of the last reconciliation. Later on this field value is used as a Starting / Beginning Balance in the first reconciliation of this Financial Account in Openbravo. This field is only editable when creating the Financial Account.
• The Current Balance: is the balance of the Financial Account as per Openbravo records. It is calculated as the sum of the Initial Balance and every Financial Account transaction. This field is placed in the Status Bar.
• The Matching Algorithm to be used during the reconciliation process.
  • If no matching algorithm is selected in that field it is not possible to import and then match a bank statement file but to Reconcile the account transactions.
  • If a matching algorithm such as the Standard matching algorithm is selected that allows to use the Import Statement process. This process allows to import data from a file to the Imported Bank Statements tab, and then use the Match Statement process to match the account transactions with the imported bank statement lines. This matching algorithm supports "G/L item transactions" recognition.
  • There is another algorithm delivered as a module named Advanced Matching Algorithm. This module allows Imported Bank Statement lines to be matched not only with the existing financial account transactions but also with payments, invoices or orders. If no transaction document of that type is found it registers a credit payment for the Business Partners to be used later on. This matching algorithm supports the automatic creation of payments and financial account transactions (deposits and withdrawals), including the creation of "G/L item transactions".
  • The Funds Transfer Enabled is used to enable/show funds transfer button process. By default, every financial account is set as enabled.

The next section Bank Account is visible only for accounts of the type Bank and are used to specify the bank account number. This section includes information such as:

• the Generic Account No - a generic account number to identify the bank account can be introduced here. This field must be mandatory set in case either the Use Generic Accoun No. or Use SWIFT + Generic Account No. is selected at the "Bank Account Format" field.
• The IBAN - The International Bank Account Number (IBAN) is an international standard for numbering bank accounts.
  The IBAN consists of a two letter ISO 3166-1 country code, followed by two check digits, and up to thirty alphanumeric characters for the domestic bank account number, called the BBAN (Basic Bank Account Number). This field must be mandatory set in case the Use IBAN option is selected at the "Bank Account Format" field. The IBAN code will be automatically validated when inserting/updating the record taking into account the rules for the country bank defined.
• The SWIFT Code - Corresponds to the ISO 9362 international bank code identifier. It must be mandatory set in case the Use SWIFT + Generic Account No. option is selected at the "Bank Account Format" field.
• Country - you can select a country from the list to specify if the bank account is a domestic bank account or a foreign bank account.
• Bank Account Format - List that contains all the possible values for generating the Displayed Account Number, which will be later on used by other reports or processes to get the account identifier. Possible values are:
  • Use Generic Account No.
  • Use IBAN
  • or Use SWIFT + Generic Account No.

Note that other options can be added by other modules that extend the supported Bank Account Format.

More information section can include information such as:

• The Type Write-off Limit field which allows to define different type of write-off limits for a financial account.
  This field is displayed when the "Write-off limit" property value is set to "Y" in the Preference window.
  • The only option currently available is "Amount"
• And the Write-off Limit Value for the Write-off limit in a payment. When type selected is Amount, the value holds the amount on financial account currency.
  This field is displayed when the "Write-off limit" property value is set to "Y" in the Preference window.

Let's take for instance the setup of a "Write-off Limit" amount of 1,00 $ for a given financial account.
While registering a customer's payment in the Add Payment window the system will not allow to write off an amount above the write-off limit amount defined.
Same applies to supplier's payments created by using the Add Payment window or the Payment Proposal feature.

The financial account window allows to perform below listed actions:

Transaction Tab

The transactions of a financial account can be of two types:

• Deposit transactions in the case of receiving whatever document type (invoice, order, G/L item or fee) payment in
• or Withdrawal transactions in the case of making a payment out of whatever document type (invoice, order, G/L item or fee)

Those two transaction types can be created in three ways:

• automatically, if the payment method used to pay a document (and assigned to a given financial account) is configured to get that:
  • the supplier's payments once processed in the Payment Out window are automatically withdrawn from the financial account
  • the customer's payments once processed in the Payment In window are automatically deposited in the financial account.
  • or the "G/L Item Payments" once created in a G/L Journal are automatically either deposited to/withdrawn from the financial account.
• in a batch, by adding several payments as transactions through the Add Multiple Payments process window [since PR15Q3]
• or manually, by creating a new record in the transaction tab of the financial account window.

• Fields to note in transaction tab:
  • Transaction Type: the Transaction Type indicates the type of transaction to be submitted. The transaction tab also allows to create a "Deposit" or a "Withdrawal" transactions based on a "G/L Item" transaction type or on a "Payment".
    • Bank fee
    • BP Deposit
    • BP Withdrawal
  • Transaction Date: the Transaction Date field defines the date of the transaction being processed.
  • Accounting Date: The date this transaction is recorded for in the general ledger.
  • Payment: Payment selector
  • G/L Item: General ledger item selector
  • Currency: Indicates the currency to be used when processing this document
  • Deposit Amount: amount in the case of receiving a payment
  • Withdrawal Amount: amount in the case of make a payment
  • Accounting Dimensions

If it is needed to create a "Bank Fee", Select "Bank Fee" in "Transaction Type" combo, enter a transaction and accounting date and the amount either received in or paid out.
Then save and process the transaction.

To create a new G/L item transaction, select "BP Deposit" or "BP Withdrawal" in transaction type and select the "G/L Item" in the G/L item combo, enter a transaction and accounting date, select a G/L Item, enter the amount either received in or paid out and save and process the transaction.

If the user needs to create a new payment transaction it is allow to select a created payment or create a new payment from the payment selector.

• If the payment is created, the user should choose the payment in the payment selector.

Description and amount fields in transaction tab will be automatically filled and to complete the transaction it is necessary to save and process.

• If it is needed to create a payment deposit transaction the user should be click in '+' button' in payment selector and add payment popup will be open. "Received In" needs to be selected in the field "Document".

This window allows to:

• • select already created and processed payments
    • use the field "Received From" to narrow down the searching of documents to pay
  • use the business partner's "Available Credit" if any, selecting the credit in credit grid
  • enter the "Actual Payment" amount received
  • enter a "Payment Date"
  • select the "Transaction Type" to pay
  • use some other filters such as the Order or Invoice "Document No." or the "Amount From/To"
  • and finally to enter a "G/L Item Payment" if needed, by adding "GL Items" in a gl item grid.
  • Last step is to process the just created payment and get it deposited in the financial account.

Exchange rates

This tab allows to define an exchange rate to use while posting the financial account transaction to the ledger whenever the currency of the financial account is not the same as the general ledger currency.

Accounting History

This tab shows the accounting history of a given transaction.

Accounting Configuration

The accounting configuration tab is used to define the accounts of a General Ledger to use while posting transactions such as a bank fee or a deposit.

Payment Method

This tab lists all the payment methods assigned to the financial account. A payment can either be deposited in or withdrawn from the financial account if the payment method used is assigned to the financial account.

Imported Bank Statements

The tab lists the imported bank statement files as well as the bank statements created manually.

Bank Statement Lines

This tab list all the lines of a bank statement.

Reconciliations

The reconciliation tab shows the reconciliations created manually if no matching algorithm is assigned to the financial account as well as the ones created while matching an imported bank statement file otherwise.

Cleared items

This tab shows the transactions cleared or set as matched in a reconciliation.

Accounting

The accounting tab is a read-only tab which showa every financial account transaction posting.

Full list of Financial Account window fields and their descriptions is available in the Financial Account Screen Reference.

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