In the ever-evolving financial management landscape, the SAP Cash Application emerges as a revolutionary solution designed to streamline and automate the often complex and time-consuming cash allocation process.
With intelligent automation of the manual cash application process, integration with embedded machine learning proposals, and intelligent data management capabilities, the SAP Cash Application represents a strategic leap towards optimizing cash management workflows.
This article will discuss the intricacies of the innovative SAP Cash Application tool, examining its features, benefits, and the transformative impact it brings to the realm of financial operations within the SAP ecosystem. We’ll also chat briefly about our SAP consulting services to help you better understand where our team can come in to help.
What is Cash Application in SAP?
SAP Cash Application offers a consolidated bundle of cloud microservices that leverages an intelligent machine learning model to simplify the order-to-cash process and streamline other areas of the accounts receivable process.
By utilizing a machine learning model trained with data from past manual transactions, the SAP Cash Application applies historical data to new master data, enabling a higher rate of automatic clearing and reducing manual post-processing of incoming bank statements.
When the SAP Cash Application is in production, incoming payments and accounts receivables are reviewed and maintained for efficient matching, returning both matching payments and proposals depending on the configured target auto-clearing accuracy and documenting all automated actions in secure logs.
Four Pillars of the SAP Cash Application Solution
The SAP Cash Application solution comprises four main pillars that improve the efficiency and effectiveness of the cash application process, including:
SAP Cash Application app
The SAP Cash Application is designed to help customers quickly and easily resolve cases of uncleared payments through intelligent machine-learning tools, addressing payments that lack sufficient information for clearing by the Accounts Receivable (AR) team and accelerating the processing of incoming payments for improved customer service.
Receivables automation capabilities in SAP Cash Application are powered by SAP Machine Learning, enabling users to access and learn from historical transactions in which customer payments are applied to invoices for open accounts receivable items.
With the SAP Cash Application, customers can leverage intelligent receivable matching automation functionality to automate the process of clearing incoming payments with corresponding receivables, proposing prediction results and a matching proposal based on historical data.
Manage Bank Statement Reprocessing Rules app
The Manage Bank Statement Reprocessing Rules application enables business users to leverage predefined conditional rules to clear open bank statement items automatically and create reprocessing rules based on proposed templates.
This application analyzes previous clearings and postings and leverages historical data to generate rule templates that cater to individual users’ needs and can be run automatically after each bank statement is imported into the system.
By leveraging the Manage Bank Statement Reprocessing Rules app, companies can leverage artificial intelligence and machine learning functionality to create bank statement posting and clearing rules, reducing the amount of manual processing in the bank statement process and leading to greater accuracy for critical bank statements.
Reprocess Bank Statement Items app
The Reprocess Bank Statement Items app is an SAP S/4HANA Cloud application designed for bank statement processing, enabling users to manually or automatically enter bank statements into the system, reprocess an open bank statement item, and add attachments to statement items as needed.
By pairing the Reprocess Bank Statement Items app with SAP Cash Application functionality, users can directly integrate information from both systems into the Reprocess Bank Statements app, eliminating the need for new applications and complex migrations between systems.
Manage Payment Advices app
The Manage Payment Advices application is used to manage payment advices in the cash application process, including critical text, amounts, and item numbers from a customer to indicate that a customer invoice has been with an incoming payment.
SAP supports payment advices in both PDF formatted files and Microsoft Excel spreadsheets, enabling the automatic import, reading, and storage of each payment advice within the SAP Roadmap and improving the efficiency of core payment advice extraction and clearing processes.
With the Manage Payment Advices app, SAP customers can:
- Upload payment advices from existing files or manually enter them through the app
- Confirm payment advices
- Mass upload payment advices from an email server on a pre-scheduled basis
- Run reports of payment advices available for use in the cash application process
Key Features of SAP Cash Application Software
Here are a few critical features of the SAP Cash Application solution for business users:
Intuitive receivables matching
- Matching proposals for open items and customers
- Automatic posting and clearing processes
- Options to schedule receivables processing as a single run or recurrent process
Intelligent payment advice documents
- Automatically match customer payments to invoices
- Classify specific regions on payment documents
- Extract and transfer relevant payment and open invoice information from S/4HANA to a matching engine
Integration with machine learning technology
- Automate repetitive and labor-intensive clearing processes with a model that automatically clears and suggests proposed matches for review
- Free up accounting teams to focus on more complicated cases that cannot be cleared automatically, improving accuracy and efficiency
- Leverage machine learning tools to learn from previous accountant behavior and apply knowledge to future payments
Main Advantages of SAP Cash Application for Business Users
Let’s take a closer look at five of the main advantages of the SAP Cash Application:
Acceleration
By leveraging an intelligent machine learning model, the SAP Cash Application allows users to accelerate the processing of incoming payments, reduce overall days sales outstanding, and improve service for customers across the entire business ecosystem.
Cost
With embedded machine learning capabilities that learn from real accountants and match both customer and country-specific receivables, companies can automatically respond and adapt to change, reduce the total cost of ownership, and improve time to value.
Scalability
The SAP Cash Application enables users to extract value from historical data, complement standard bank statement and payment advice rules, and maintain core processing workflows.
Pre-built integration between on-premise and cloud SAP S/4HANA deployments also makes it easier for customers to improve collaboration across teams and facilitate more efficient data exchange.
Complexity
In addition to its capacity to handle a high quantity of customer payments, the SAP Cash Application can process payments with a higher level of complexity, enabling companies to manage all critical payments and invoices from the same platform.
The algorithms in SAP Cash Application easily identify and match an individual payment to multiple existing line items and configure both country and region-specific settings to further segment payments and reduce overall complexity for business users.
Efficiency
The SAP Cash Application simplifies the cash application process, allowing for a reduced manual workload for employees and a higher degree of automation across systems.
By automating core processes, companies can identify, analyze, and post bank statement items and lockbox items more efficiently, saving valuable time, effort, and money to spend on higher-value tasks.
How Can We Help?
Whether you need help implementing new SAP applications, an extra hand navigating complex integrations between SAP and non-SAP systems, or additional support handling module-specific tasks, like entering data into a clearing document or analyzing remittance information, Surety Systems can help.
Our senior-level, US-based SAP consultant team has the technical knowledge, functional expertise, and experience to handle your most critical project needs and ensure your internal teams are prepared for success in the future.
Getting Started with Us
Interested in learning more about SAP Cash Application or its connections to other SAP solutions, like SAP S/4HANA, SAP S/4HANA Cloud, SAP ECC, and the SAP Business Technology Platform? Ready to get started on a project with our team of expert SAP consultants?
Contact us today for more information.
