Inhouse Cash Management in SAP S/4 Hana FSCM

SAP In-House Cash is used for processing internal and external payment transactions within a group or company. By using SAP In-House Cash you can reduce the number of external bank accounts you hold and the volume of foreign payments you have to make. SAP In-House Cash is implemented at a central location within a group of companies, for example, in head office.

With SAP In-House Cash , you can process the following transactions:

• Internal payments
• Central payments
• Local payments
• Central incoming payments

The following graphic shows the flow of data within a group of companies that uses SAP In-House Cash in its head office.

To use the In-House Cash functions, make the necessary system settings in the Implementation Guide (IMG) by choosing Financial Supply Chain Management In-House Cash.

Make the following settings in the implementation guide (IMG) under Financial Accounting for the subsidiary companies and head office.

SAP In-House Cash is connected to the head office’s Financial Accounting (FI) system, and uses its functions, such as the payment program. The affiliated companies also use Financial Accounting (FI) functions. For instance, they also use the payment program to clear open items. The IDocs generated as a result automatically forward payment orders to the in-house cash center. Electronic account statements for the house bank of the head office can be imported to Financial Accounting (FI), and the data is passed on to the in-house cash center. The affiliated companies also receive an account statement from the in-house cash center.

If you create an IHC financial status , you can forward this to SAP Cash Management .

The main component of SAP In-House Cash is the in-house cash center which processes payments between the various subsidiary companies. The in-house cash center is basically a virtual internal bank where subsidiaries hold current accounts. Current account processing depicts receivables and payables between the in-house cash center and affiliated subsidiary companies. It calculates the turnover and balances of the current accounts and forwards this information in summarized form to Financial Accounting (FI).

You can find the SAP In-House Cash functions on the SAP Easy Access screen under Accounting Financial Supply Chain Management In-House Cash .

Example

The following graphic shows a group of companies, organized to enable both cross-bank-area and local payments:

• Two companies use SAP In-House Cash and both serve as internal banks for a certain number of subsidiary companies.
• They are also mutual clearing partners.
• Subsidiaries 3 and 4 carry out local payments as clearing partners for other subsidiaries.International Group Structure

Bank Area

Definition

Organizational unit of Bank Customer Accounts that allows independent account management. This also means that the account numbers that exist in a bank area must be unique.

Structure

Customizing Settings

You make settings for bank areas in Customizing for Bank Customer Accounts (BCA). The important settings are described below:

• Bank key
• Check digit method that controls or checks the issuing of account numbers
• Time at which posting cut-off is to be automatically executed every day
• Exchange rate category that stores conversion rates in the system
• Country/region, language, and the public holiday calendar used

Special Feature: Bank Area and Bank Key

The bank key is particularly significant, since bank keys, along with the account number, are used for the processing of payment transactions. All banks participating in payment transactions can be identified by a unique numerical labeling.

Branch offices either have their own bank identification number or one that is related to their main office.

The internal organization of a bank may require several bank areas to depict the bank structure.

One Bank Key Can Involve Several Bank Areas

The system checks that the account number is unique in all bank areas with the same bank key. In addition, to avoid the creation of the same account number simultaneously in different bank areas, the system locks this account number in all bank areas belonging to the bank key.