Cash Journal Process

February 21, 2009 by mySAP
Filed under: General Ledger Process 


This refers to the process of making payments via petty cash or cheques.

Common Business Requirement

Multiple cash journals and multiple currencies will be defined within the system.

Cash journals will be used only for petty cash expenses. Entries will be passed by the cashiers without updating the GL. The entries that are passed will be posted after approval. Expenses incurred for employees should be captured using cost center. Customer or vendor transactions without the special G/L indicator will be defined in the cash journal.

The closing balance as reflected in the cash journal will always match the amount of cash on hand unless there is error in data entry.

Common Business Process Flow

Common Business Process Flow for Cash Journal is as follow:

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Cash Journal

Daily cash transactions will be captured and recorded in Cash Journal, a sub-ledger of Bank Accounting in SAP. Cash journal are capable of managing all cash transactions and maintain real time cash balances by adding the cash receipts and deducting the cash expenses. The sub-ledger balance in the cash journal is always reconciled to the main GL balance.
Basically, each cash journal is represented by a 4 characters alpha numeric code. Depending on how many locations within the company code deals in cash, more than 1 cash journal will be set up.
Each cash journal is linked to a petty cash GL account in the configuration. E.g., when posting payment in the cash journal, the system will debit the expense account and automatically credit the petty cash account. Similarly, when posting receipt into the cash journal, the system will automatically debit the petty cash account.

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