Accounts Receivable (FI-AR)

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Table of content

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Table of content
1 Accounts Receivable (FI-AR)
1.1 Customizing for Postdated Checks
1.2 Postdated Checks
1.2.1 Check Portfolio
1.2.2 Bank Subaccount
1.2.3 Collection Account
1.2.4 Special G/L Account for Postdated Checks Receivable
1.2.5 Special G/L Account for Bounced Checks Receivable
1.2.6 Entry and Processing of Postdated Checks
1.2.6.1 Entering Incoming Postdated Checks
1.2.6.2 Presenting Postdated Checks to Banks
1.2.6.3 Clearing Postdated Checks
1.2.6.4 Entering Bounced Checks
1.2.7 Reversing Check Transactions
1.2.8 Transaction Records
1.2.8.1 Printout of Transaction Records
1.2.9 Postdated Check List

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1 Accounts Receivable (FI-AR)

The Accounts Receivable (FI-AR) component covers the most important laws and business practices specific to the United Arab Emirates. The following
documentation describes these aspects of the component.
For generic information about FI-AR, see Accounts Receivable and Accounts Payable Overview.

1.1 Customizing for Postdated Checks

To customize the payment functions for postdated checks for use in the United Arab Emirates, make the following settings in Customizing for Financial Accounting
(New) under
Bank Accounting Business Transactions
Bill of Exchange Transactions
Bill of Exchange Receivable :
Enter bank subaccounts
Choose
Present Bill of Exchange Receivable at Bank
Define Bank Subaccounts , and enter a different bank subaccount for each of the collection
accounts that you have defined.
Define a separate collection account for each of your banks
Choose
Present Bill of Exchange Receivable at Bank
Maintain House Bank Details , and enter the account number in the Collection acct
(Collection Account) field.
Assign an alternative reconciliation account to a special G/L account
Choose
Post Bill of Exchange Receivable Define Alternative Reconcil. Acct for Bills/Exch. Receivable , and assign the corresponding G/L account
to the check portfolio that you use to record postdated checks receivable and bounced checks receivable.
Assign a special G/L account to each portfolio
Choose
Post Bill of Exchange Receivable Bill of Exchange Portfolios
Define Bill of Exchange Portfolios , and enter an alternative special G/L
account for checks receivable or a special G/L account for bounced checks.

1.2 Postdated Checks

In the United Arab Emirates (UAE), postdated checks are a common form of payment. You can use the SAP system to enter postdated checks receivable in the
system as they arrive, and to process them as they become due.

Features
To process checks, you use the Bills of Exchange solution originally developed for Turkey. The documentation here focuses on the most important procedures for
working with the solution in United Arab Emirates (UAE). For more information about the solution, see Bills of Exchange.
The companies in the United Arab Emirates (UAE) must use this solution instead of the generic Checks solution or the generic Bills of Exchange solution. The
generic Checks solution, for example, cannot handle postdated checks. The generic Bills of Exchange solution, on the other hand, does not allow you to record
preprinted check numbers, and does not allow you to process multiple postdated checks simultaneously.

Activities
Customizing
In Customizing, set up:
Check portfolios
Number ranges for transaction records
Collection accounts and the corresponding bank subaccounts
Special G/L accounts for incoming postdated checks and for bounced checks
Day-to-Day Activities
You can enter and process incoming postdated checks them as described under Entry and Processing of Postdated Checks. You organize your checks in
portfolios.
For each transaction, the system automatically creates the appropriate accounting documents, and prints out a transaction record as required. You can reprint
transaction records as required.
Finally, to keep track of your checks, you can use the Postdated Check List report.

1.2.1 Check Portfolio

A collection or group of checks receivable. Storing checks in portfolios makes it easier to manage them.
You can work with as many portfolios as you like, but you must keep bounced checks in separate portfolios from other checks receivable.

Customizing
Define your check portfolios in Customizing for Financial Accounting (New) under
Transactions
Bills of Exchange Receivable Post Bill of Exchange Receivable

Bank Accounting Business Transactions

Bill of Exchange
Bill of Exchange Portfolios
Define Bill of Exchange Portfolios .

You assign a special G/L account to each portfolio. If the portfolio is for checks receivable, enter an alternative special G/L account for checks receivable. If it is
for bounced checks, enter a special G/L account for bounced checks.
Day-to-Day Activities

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When you enter an incoming postdated check, you specify which portfolio you want to record it in. The system debits the check to the customer account, and
makes an entry in the special G/L account that you have assigned to the portfolio in Customizing.
When a check bounces, the system effectively removes the check from the portfolio for checks receivable and transfers it to a portfolio for bounced checks. You
specify which bounced check portfolio you want to use in the transaction. Again, this portfolio also controls which special G/L account the system records the
check in.
You can display which checks any portfolio currently holds using the Postdated Checks List report.

1.2.2 Bank Subaccount

A G/L account that the system uses to record contingent liabilities for postdated checks that you present to a bank until the bank clears them. It denotes that the
check has not been cleared.

Customizing
Define the accounts in Customizing for Financial Accounting (FI), by choosing
Bank Accounting Business Transactions
Bill of Exchange Receivable Present Bill of Exchange Receivable at Bank
Define Bank Subaccounts .

Bill of Exchange Transactions

For each of the collection accounts that you have defined, enter a different bank subaccount.
Day-to-Day Activities
When you present a check to a bank, you specify which collection account the check is to be recorded in. The system automatically credits the check amount to
the liability account that you have defined in the above Customizing activity.
When the bank clears the check or the check bounces, the system debits the same amount to the bank subaccount to clear it.

1.2.3 Collection Account

A G/L account that the system uses to record checks receivable that you have presented to banks for collection. It denotes that a check has been sent to a bank
and is awaiting clearing.

Customizing
Define the accounts in Customizing for Financial Accounting (FI), by choosing
Bank Accounting Business Transactions
Bill of Exchange Receivable Present Bill of Exchange Receivable at Bank
Maintain House Bank Details .

Bill of Exchange Transactions

Enter the account number in the Collection Acct (Collection Account) field. You must define a separate collection account for each of your banks.
You must also assign each collection account a bank subaccount.
Day-to-Day Activities
When you present a check to a bank, you specify which collection account you want to post it to. The system then debits the check to this account.
When the bank clears the check or the check bounces, the system clears the check from the collection account.

1.2.4 Special G/L Account for Postdated Checks Receivable

A special G/L account that the system uses to record postdated checks receivable.
For more information, see The Basic Principles of Special G/L Transactions.

Customizing
Define the accounts in Customizing for Financial Accounting (FI), by choosing
Bank Accounting Business Transactions
Bill of Exchange Transactions
Bill of Exchange Receivable Post Bill of Exchange Receivable Define Alternative Reconciliation Accounts for Bills of Exchange Receivable .
Assign the account to the check portfolio that you use to record postdated checks receivable.
Day-to-Day Activities
When you enter an incoming postdated check, you specify which portfolio you want to enter it in. The system automatically debits the check to the customer
account, but makes the reconciliation posting to the special G/L account instead of the normal customer reconciliation account.
When you clear the check or the check bounces, the system clears the check from the customer account and the special G/L account.

1.2.5 Special G/L Account for Bounced Checks Receivable

A special G/L account that the system uses to record bounced postdated checks.
For more information, see The Basic Principles of Special G/L Transactions.

Customizing
Define the accounts in Customizing for Financial Accounting (FI), by choosing
Bank Accounting Business Transactions
Bill of Exchange Transactions
Bill of Exchange Receivable Post Bill of Exchange Receivable Define Alternative Reconciliation Accounts for Bills of Exchange Receivable .
Assign the account to the check portfolio that you use to record bounced checks.
Day-to-Day Activities
When a check bounces, you specify which portfolio you want to enter the check in. The system automatically posts it to this account.

1.2.6 Entry and Processing of Postdated Checks

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1.2.6 Entry and Processing of Postdated Checks

This process illustrates what you have to do to enter and process postdated checks, and which accounting postings the system makes.

Process
1. A customer purchases some goods from you. You enter an invoice in the system accordingly and send it to the customer.
When you enter the invoice, the system creates an accounting document as follows (in this example, the invoice is for AED 5,500):

2. The customer sends you a postdated check by means of payment, and you enter the check in the system.
The system creates an accounting document to clear the open item for the customer account, and to open another open item on the customer account for the
check, reconciled with the special G/L account for postdated checks:

3. When the check is due, you present it to your bank to be collected.

The system creates the following accounting document, debiting the check to the bank's collection account and crediting the corresponding bank account:

4. The bank clears the check and you record it in the system. However, if the check has bounced, proceed as described in Entering Bounced Checks.
The system creates two accounting documents. The first document debits the check to the bank account and clears the collection account:

The other accounting document reverses the contingent liability from the bank subaccount and clears the check from the special G/L account:

1.2.6.1 Entering Incoming Postdated Checks

In the United Arab Emirates, when you enter a postdated check in Accounts Receivable (FI-AR), you follow the standard procedure and, in addition, you assign
the check to the correct business place. The system also prints out a transaction record.

Prerequisites
You have already entered a customer invoice and have now received a postdated check by means of payment.

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Procedure
1. On the SAP Easy Access screen, choose
Accounting Financial Accounting Accounts Receivable Document Entry
Bill of Exchange
Payment .
2. Enter the header data as required.
3. In the Transaction to Be Processed group box, select Incoming Payment .
4. In the First Line Item group box, enter data as required, including:
PstKy (Posting key): Enter a posting key to debit the check to a special G/L account for checks. In the standard system, you use posting key 09.
Account : Enter the customer that sent the check.
Sp. G/L (Special G/L indicator): Enter a special G/L indicator for checks receivable. In the standard system, you use indicator W (bills of exchange
receivable).
5. Choose Enter .
The Bill of Exchange Portfolio Entry dialog box appears.
6. Enter the check portfolio and choose Enter .
The Bill of Exchange Payment: Add Customer Item screen appears.
7. In the Item 1 group box, enter data as required, including:
Amount : The amount stated on the check.
8. In the Bill of Exchange Details group box, enter data as required, including:
Due On : Enter the check's due date.
Ext. No. (External Number): Enter the number that is printed or written on the check.
Bank/Acct No : Enter the bank and account number that the check draws on.
9. Choose Choose Open Items .
The Bill of Exchange Payment: Select Open Items screen appears.
10. Enter data as required, so that you can find the customer invoice that the check is for.
11. Choose Process Open Items .
12. Activate the invoice that the check is for.
13. Choose
Document Simulate .
14. Make sure that the line items are correct and save the check.
The Print dialog box appears.
15. Assuming you want to print the transaction record, enter data as required and choose Print . If you want to print it out later, choose Cancel , but note that
this does not cancel the posting of the transaction.

Result
The system does the following:
Creates an accounting document for the check
Prints out the transaction record
When the check's due date arrives, you can present the check to your bank for clearing.

1.2.6.2 Presenting Postdated Checks to Banks

In the United Arab Emirates, when you present a postdated check to a bank for collection, proceed as follows.

Prerequisites
A customer has sent you a postdated check, and you have entered the check in the system. The check's due date has now arrived and you want to present the
check to the bank to clear it.

Procedure
1. To access the report, on the SAP Easy Access screen, choose
Accounting Financial Accounting Accounts Receivable Document Entry
Bill
of Exchange Bill of Exchange / Postdated Checks Enhancement Bill of Exchange / Postdated Checks Transactions .
2. Enter your company code.
3. On the Transactions tab page, select Presented to Bank .
4. On the Selection Criteria tab page, enter data as required, including which check portfolio the check is in and which currency the check is in, and choose
Execute .
A list of checks appears, which is formatted using the SAP List Viewer: see this documentation for more information about navigating and formatting options
within the list.
5. Select the checks that you want and choose Execute .
The Posting Data dialog box appears.
6. Enter the collection account for checks to be collected by this bank, and choose Enter .
The Print dialog box appears.
7. Assuming you want to print out the transaction record, enter data as required and choose Print . If you want to print it out later, choose Cancel , but note that
this does not cancel the posting of the transaction.

Result
The system:
Creates an accounting document to post the check
Prints out a record of the transaction

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When the bank notifies you that the check has cleared, you can record this in the system.

1.2.6.3 Clearing Postdated Checks

In the United Arab Emirates, when a bank clears a postdated check, proceed as follows to record it in the system.

Prerequisites
You have already entered the check in the system and have presented it to the bank. Now you have received notification from your bank that the check has been
cleared.

Procedure
1. On the SAP Easy Access screen, choose
Accounting Financial Accounting Accounts Receivable Document Entry
Bill of Exchange Bill of
Exchange / Postdated Checks Enhancement Bill of Exchange / Postdated Checks Enhancement Transactions .
2. Enter your company code.
3. On the Transactions tab page, select Cleared at Bank .
4. On the Selection Criteria tab page, enter a collection account (in the Interim Account field), a check portfolio, a currency, and any other data, and choose
Execute .
A list of checks appears, which is formatted using the SAP List Viewer: see this documentation for more information about navigating and formatting options
within the list.
5. Select the checks that the bank has cleared and choose Execute .
The Confirmation dialog box appears.
6. Choose Yes to continue.

Result
The system creates two accounting documents to clear the check.

1.2.6.4 Entering Bounced Checks

In the United Arab Emirates, when a bank cannot collect a check, proceed as follows to record it in the system. The system clears all the open items associated
with the check, and creates a new open item for the bounced check.

Prerequisites
You have already entered the check in the system and have presented it to the bank. Now you have received notification from your bank that the check has not
cleared.

Procedure
1. On the SAP Easy Access screen, choose
Accounting Financial Accounting Accounts Receivable Document Entry
Bill of Exchange Bill of
Exchange / Postdated Checks Enhancement Bill of Exchange / Postdated Checks Transactions .
2. Enter your company code.
3. On the Transactions tab page, select Cleared at Bank .
4. On the Selection Criteria tab page, enter a collection account (in the Interim Account field), a check portfolio, a currency, and any other data, and choose
Execute .
A list of checks appears, which is formatted using the SAP List Viewer: see this documentation for more information about navigating and formatting options
within the list.
5. Select the checks that the bank has cleared and choose Execute .
The Posting Data dialog box appears.
6. Enter a check portfolio for bounced checks and the special G/L indicator for bounced checks and choose Enter .

Result
The system:
Creates two accounting documents for the check
The first document clears the check from the customer account (and the special G/L account for postdated checks), and clears the bank subaccount as
well:

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The second document creates a new open item on the customer account (and the special G/L account for bounced checks), and clears the collection
account.

The only open item remaining is the bounced check on the customer account.
Prints out the transaction record
If the customer notifies you that it now has enough funds to cover the check, and asks you to present the same check to the bank, you can reverse the bounced
check and then present it to the bank once again.

1.2.7 Reversing Check Transactions

When a check bounces, your customer may, after making sure that its bank account has sufficient funds to cover the check, ask you to try to clear the check
again. If you have already entered the bounced check in the system, the simplest procedure is to reverse the bounced check transaction, to reset the check's
status from Bounced at Bank but Presented to Bank .
You can also use this function to reverse all other check transactions, with the exception of bounced bills that you have cleared from the system.

Procedure
The report works the same way for each type of transaction that you have to reverse.
1. To access the report, on the SAP Easy Access screen, choose
Accounting Financial Accounting Accounts Receivable Document Entry
Bill
of Exchange Bill of Exchange / Postdated Checks Enhancement Reversal of Bill of Exchange / Postdated Checks Transactions .
2. Enter your company code.
3. On the Reverse Postings tab page, select From Bounced at Bank/Vendor to Presented to Bank (or another transaction that you want to reverse).
4. On the Selection Criteria tab page, enter the check portfolio and the currency, and other data as required, and choose Execute .
A list of checks appears, which is formatted using the SAP List Viewer: see this documentation for more information about navigating and formatting options
within the list.
5. Select the checks that you want to reverse and choose Execute .
The Confirmation dialog box appears, where you are required to confirm your entries.
6. Choose Yes .

Result
The system:
Creates the accounting documents needed to reverse the postings as appropriate
It creates a separate accounting document for each document to be reversed.
Prints a transaction record, in the following cases only:
Cleared at Bank to Bounced at Bank/Vendor
Cleared at Vendor to Bounced at Bank/Vendor
Bounced at Bank/Vendor to Cleared at Bank
You can now try to clear the check again.

1.2.8 Transaction Records

The system automatically prints out written records of (some) transactions involving checks.

Activities
Customizing
Make the settings in Customizing for Financial Accounting (New) , choose
Bank Accounting Business Transactions
of Exchange Receivable Post Bill of Exchange Receivable Bill of Exchange Portfolios
Transaction Records .

Bill of Exchange Transactions

Bill

Day-to-Day Activities
The system creates transaction records automatically when you:
Enter an incoming postdated check
Present a postdated check to a bank
Enter a bounced postdated check
Reverse a check transaction
Whenever you enter one of these transactions, the system automatically saves the transaction record in the database and prints out a copy of it.
You can also reprint the transaction records if required.

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1.2.8.1 Printout of Transaction Records

You use this program to print out copies of existing transaction records. There is no limit to the number of printouts that you can make.

Activities
1. To access the report, on the SAP Easy Access screen, choose
Accounting Financial Accounting Accounts Receivable Document Entry
of Exchange Bill of Exchange / Postdated Checks Enhancement Printout of Transaction Records .
2. Enter data as required and choose Execute .
A list of transaction records appears, which is formatted using the SAP List Viewer: see this documentation for more information about navigating and
formatting options within the list.
3. Select the records that you want to print and choose Transaction Record .

Bill

1.2.9 Postdated Check List

You use this function to display a list of all of your postdated checks receivable. In particular, you can use it to find out which bills' protest periods have elapsed,
so that you can clear them.

Features
The list is a localized version of the standard bill of exchange list. Its main additional feature is that it allows you to work with portfolios. For more information, see
Bill of Exchange List.
The list makes use of the bill of exchange history and is formatted using the SAP List Viewer: see this documentation for more information about navigating and
formatting options within the list.
To improve system performance, you can implement the Business Add-In in Customizing for Financial Accounting (New) , choose
Bank Accounting
Business Transactions
Bill of Exchange Transactions
Bill of Exchange Receivable Post Bill of Exchange Receivable Bill of Exchange Portfolios
Business Add-Ins
Dynamic Selections in Bill of Exchange List .

Activities
To access the report, on the SAP Easy Access screen, choose
Exchange Bill of Exchange / Postdated Checks Enhancement

Accounting Financial Accounting Accounts Receivable

Bill of Exchange / Postdated Check List .

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Document Entry

Bill of

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