Finance and Accounting · Daily operations · 9 min read

Treasury register, cash position and cash forecast

Register cheques, guarantees, deposits and letters of credit, watch maturities, and read cash position and the weekly cash forecast.

Before you begin

• Permissions: treasury.view to read; treasury.manage to register, edit, change status and record drawings; treasury.release to release; report.view for cash position and forecast; journal.prepare to save forecast versions.
• Instrument types exist. Under Finance > Configuration > Treasury instrument types, press Add the standard types (cheque, bank guarantee, performance guarantee, advance payment guarantee, bid bond, fixed deposit and letter of credit) or New type.

Register an instrument

1. Open Finance > Treasury > Register and press Register an instrument.
2. Choose the Type. The type's kind decides which fields are required: a cheque or guarantee needs the number or reference and the counterparty; a guarantee, deposit or letter of credit needs the bank.
3. Enter the Face value (above zero), the Currency (blank is the company currency), Issued and the date it Matures (not before issue). The Direction defaults to held for a cheque and issued for the rest.
4. Optional: collateral type, amount and note (visible only to managers and releasers), and notes.
5. Save. The instrument gets a code and a starting status such as Post dated.

Move it through its life

On the instrument page use Mark as with the next allowed status. For a cheque: post dated to received, deposited, then cleared or returned. Returned, called, cancelled and expired need a note. Cleared and cancelled are final.

For a letter of credit, press Record a drawing with the amount; it cannot exceed the balance left. Example: a USD 80,000.00 letter of credit drawn 50,000.00 has a balance of 30,000.00; a further 40,000.00 is refused.

Release

1. A user with treasury.release opens a guarantee, deposit or letter of credit and presses Release. The target is shown: released, withdrawn or closed. A cheque has no release.
2. Enter the Evidence (for example the bank's release letter) where the type requires it.

If the type says a second person releases it, the person who registered the instrument cannot release it.

Watch maturities

Open Finance > Treasury > Maturities and choose how far to look ahead (30, 60, 90, 180 days or a year). Cash-related items (cheques and deposits) and contingent items (guarantees and letters of credit) are listed apart, with totals per currency in and out. Cash and contingent amounts and different currencies are never added together. Open instruments past maturity are shown in red with a warning.

Cash position

Open Finance > Banking > Cash position and choose the date. For each cash and bank account you see the ledger balance, pending receipts and payments (booked but not yet on a statement), the estimated bank balance and available cash.

Worked example. Ledger balance AED 100,000.00, a receipt of 8,000.00 and a payment of 3,000.00 not yet on any statement. Pending receipts 8,000.00 and pending payments 3,000.00. Estimated bank balance = 100,000 - 8,000 + 3,000 = 95,000.00. Available cash = 100,000 - 8,000 = 92,000.00.

Cash forecast

1. Open Finance > Banking > Cash forecast. Choose the Start, the number of Weeks (1 to 52) and the Scenario.
2. Add assumptions: date, category, description and signed amount (positive in, negative out). You can add up to 200.
3. Press Calculate. The weekly table keeps three kinds of figure apart: actual (open invoices and bills), committed (confirmed orders) and assumptions. See the closing cash, the lowest point and the weeks below zero.
4. Press Save this version to keep it; each save is a new version that never changes.

Example: available cash AED 92,000.00. An overdue bill of 15,000.00 lands in week 1 (closing 77,000.00). A customer invoice of 20,000.00 is due in week 2 (97,000.00). A confirmed sales order of 10,000.00 falls in week 3 (107,000.00). A payroll assumption of -85,000.00 in week 4 leaves 22,000.00.

Good to know

• Payroll, tax, projects and treasury instruments are not read by the forecast; add them as assumptions.
• The summary tile counts "due soon" at 30 days while each row uses its type's alert days.
• Turning off the Treasury feature also switches off the cash forecast.