Financial Transactions Getting Started

A Financial Transaction is an agreement between a buyer and a seller to exchange Services or Physical Goods for payment. The transaction’s nature is differentiated by its classification (Invoice, Credit Note, Payment, Refund etc.) It involves a change in the status of the finances of the businesses or individuals involved, and is reflected on the customer's Accounts Receivable balance.

What Comes First

To start using Financial Transactions configure the System to support your own business model. In the following table, find the configuration modules related to Financial Transactions. 

Sub-module	Type	Classification	Navigation	Dig In
Payment Methods	Configuration		CONFIGURATIONFINANCE APPLICATIONFINANCIAL TRANSACTIONSSET UP PAYMENT METHODS	Financial Transactions
Financial Transaction Types	Configuration		CONFIGURATIONFINANCE APPLICATIONFINANCIAL TRANSACTIONSSET UP TYPES	Financial Transactions
Rejection Reasons	Configuration		CONFIGURATIONFINANCE APPLICATIONFINANCIAL TRANSACTIONSSET UP REJECTION REASONS	Financial Transactions
Financial Transaction Definitions	Configuration		CONFIGURATIONFINANCE APPLICATIONFINANCIAL TRANSACTIONSSET UP BUSINESS DEFINITIONS	Financial Transactions
Financial Transaction Categories	Configuration		CONFIGURATIONFINANCE APPLICATIONFINANCIAL TRANSACTIONSSET UP CATEGORIES	Financial Transactions

Step 1: Setting up Payment Methods 

Start by configuring the Payment Methods used by Financial Transaction Types of Classification Payment.

Payment Methods are the options available to customers for paying for Products. The Payment Method is defined during the creation of Payments.

For each defined Payment Method,  provide a unique Name and Alternative Code.

Step 2: Setting up Financial Transaction Types

Financial Transaction Types must be configured next.

Financial Transaction Types determine the behaviour and the nature of each Financial Transaction. Multiple Financial Transaction Types can exist in the System.

For each Financial Transaction Type define:

• Classification: the nature of the transaction, including its notation in the double-entry accounting system (debit or credit). Financial Transaction Type Classifications are predefined in the System and cannot be overridden:
  • Invoice
  • Invoice Cancellation
  • Credit Note
  • Payment
  • Payment Cancellation
  • Refund
• Allowed Payment Methods: The predetermined ways to make a Payment. Available and Mandatory on Conditions only if the Classification if set to Payment.

Step 3: Setting Up Rejection Reasons

Rejection Reasons are defined next.

Rejection Reasons is the explanation for rejecting a Financial Transaction.  Only Financial Transactions in a 'Draft' state can be rejected.

Step 4: Setting Up Financial Transactions Definition

An 'Active' Financial Transactions Definition must be configured next.

Financial Transaction Definitions is a set of business rules used to control the behaviour of Financial Transactions throughout their Life Cycle.

Through the Definition you can:

• Define values for System Generated Financial Transactions Settings. Specify the Financial Transaction Types that will be selected automatically (i.e. by default) when a Financial Transaction of each Classification is created. A Financial Transaction Type can be specified for each of the following Classifications:
  
  • Invoice
  • Full Invoice Cancellation
  • Credit Note
  • Payment
  • Payment Cancellation
  • Refund
• Define Available Rejection Reasons: Defines the reasons for which Financial Transactions in a 'Draft' state can be rejected. It is mandatory to select the default Rejection Reason.

Step 5: Setting Up Financial Transactions Categories

Configure the following module for additional functionality and categorisation. You can skip the configuration of these modules if they are not required by your business model.

• Financial Transaction Categories: Used to classify Financial Transactions into generic groups based on common attributes. Financial Transaction Categories follow a hierarchical structure.

Do it Yourself!!