Top 5 things you need to know about Banking




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Welcome everybody and thank you for attending. Just a few housekeeping rules to start. Attendees will be on mute and will remain on mute for the whole webinar. If you do have a question related to the topic, they will all be answered after the demo. If we do run out of time or if the question requires a longer answer, then we’ll answer that offline directly. Please use the chat box for any questions related to the webinar.

So for example, if you can’t hear the audio or if the presenter is going too fast. Please note that a link to view the recording of the webinar will be sent to all of the attendees after the demo. Okay. So this is the 17th announced series of monthly webinars on key areas of NAV Business Central, you can sign up for as many as you like on our website and I’ll show you the list of upcoming webinars at the end of the session and we also do send out regular emails to register for the next one.

My name is Karen and I’ll be facilitating the demo today. I’m an account manager here at TVision. My background is 18 years of software account management experience working for ERP companies. Ian will be doing the demo today. He’s our support consultant here at TVision and he’s been working here for about three years and using NAV and Business Central since 2000.

So banking is one of the largest areas of inquiry we have after a client who’s gone live on NAV or Business Central. Once clients start using a solution for a while, they do start to question whether the banking process can be automated. But to help you get started its worth considering or being aware of the following. So on your GL, do you want to see a separate line for each bank account, or one total for all bank accounts? And how do you want to see that cash asset on your GL?

Each bank has a different file format, we’ve done exports and imports with all the major UK Banks and some foreign ones, but they do tend to change their file formats on a regular basis. So we need to do the work to produce the correct file format rather than rely on what we’ve done previously.

We can do development, or extension, if you’re on software as a service that’s required. Or you can look to third-party solutions such as AMC, IDYN or Envestnet. The same applies to Direct Debits, as these aren’t standard in NAV or Business Central.

Once you’re set up and you can see transactions or payments, you have the option of allowing the software to auto-match on certain parameters, such as the date or amount, or you can choose to do this manually. If you transact or make payments in different currencies, then you have the option of manually updating this rate, or you can link to an external exchange rate website. Some of these sites require payment for this service. You also need to decide how often you want to update the rates. Where there are differences in exchange rates at the end of the month, for example, there is built-in functionality to update your general ledger with the new exchange rates and post the differences to the FX gains losses account. To keep all these things in mind while we go through the demo.

Here are the top 5 things about banking that we’re going to discuss and show you today. First of all the banking set up. Second the payment journals or exporting backs.

Third Bank, reconciliations and statement import. Cash receipt journals and exporting direct debits, and then manage the foreign currency transactions. So before the demo, I’m going to show you… I’m going to launch a quick poll just to get an idea of how automated you like your bank process to be, and after that I’ll hand over to Ian for the demo. So I’m just going to launch it now. If you wouldn’t mind just putting in your answers, that would be brilliant.

And what I’ll do is I’ll let you know what the results are and then I’ll hand over to Ian.

Okay, so it’s just collecting responses at the moment. Just give it another 30 seconds to a minute just while we wait the more people to vote.

Okay, just getting the last few in.



So if I just look at the results, it’s pretty split between people wanting a mostly automated processes. Just checking manual errors, and then also being somewhat automated and doing a manual check before posting. Okay. I’m now going to hand over to Ian.

Hi guys. Thanks for joining us today. For today’s demo, I’m using Business Central latest version, pretty standard set up. So nothing really fancy. It’s out of the box. I’ve chosen to use Business Central because there are a few subtle differences between Business Central and NAV, and I just wanted to make sure you were aware of those. So as Karen mentioned right at the beginning is your chart of accounts, how you want to report your cash assets.

So if we just look at this company and we have a quick look at the chart of accounts.

And here we can see where my bank accounts are stored in the GL. When the system arrived these GL accounts were here, all the Pound Sterling accounts, bank accounts rolled up into one GL account, foreign currencies rolled up into another. For simplicity, I’ve created two new GL accounts – one for my Sterling, and one for a USDA account just to show some of the differences.

You’ll notice here in my GL, my Sterling account has a thousand pounds, my US account has six hundred forty eight pounds. Those numbers do become important to little bit later on. One thing to remember with bank accounts on the GL, these are not your actual bank accounts. This is just the reporting of your bank account on the general ledger. So you do your transactions in the bank account and that automatically roll into your general ledger.

So it’s very important for all of your controlled accounts to make sure direct costing is turned off, that guarantees nobody can manually fiddle with these numbers here. They’re forced to post through the bank in order to change these accounts. Manual posting on control accounts – never a good idea.

Once you’ve got your GL accounts setup where you want the banks to go, if you have any banks in foreign currencies, you’re going to want to go and set up those currencies in your system and set up the exchange rates that you’re going to use. That’s not something I’m going to go into much detail with here. I’m going to concentrate more on the banking, but one important thing if you’re using foreign currencies is to keep your exchange rates updated. There are two ways of doing that.

You can manually once a month update the exchange rates, or I think Karen mentioned you can pay for a service where you can download the exchange rates automatically and you can do that every day if you wanted to if you really want to keep your exchange rates up to date if you’re doing a lot of foreign currency transactions. And it’s pretty simple to set that up. Right, so once you’ve got your currency setup, you’ve got your GL account setup, let’s go and have a look at our bank accounts themselves.

So I’ve logged on in the finance department. So I’ve got some nice shortcuts to get to these things. These are all the bank accounts that came with the system. I’ve created these two new accounts, and just let’s have a look at the US dollar account. You put in the standard information bank account numbers Branch codes etc.

And this code down here is where you link this bank account to the GL account, and we can see that this bank account is going to go to the GL account two-nine three-two. It’s also set as a US dollar bank account. So when we look at the balance on this account, it contains $1,000 in Pounds Sterling. That’s six hundred forty eight pounds 83. So while the bank account is showing me in it’s its currency US Dollars. The GL should be reporting this number.

If you not allowing any manual postings in the GL on that account this, number and the general ledger, should always match. And that’s nice check to do at the end of every month. Just make sure that the balance on the bank accounts, balance in the GL, all the same to make sure there are no rogue transactions that you need to look into.

All right. So once you’ve got your bank accounts set up, there are some activities that you’re going to want to perform for main activities. You probably want to perform pay your creditors your vendors receive payment from your customers your debtors.

You might want to transfer money from one account to another account and then once a month or even more frequently than that, you probably going to want to reconcile that bank account make sure the bank and your system are showing the same amount. So first thing payments, but before we go into payments, there’s an important decision that you need to make. How are you going to handle your payments? So here in the UK when we pay our vendors usually we create a BACS file, we give it to our bank and the bank then mix of payments from our account.

Sad news BACS format is pretty unique to the United Kingdom. It’s not a worldwide format. So in Business Central by default BACS is not on the system. If you’ve got an older version of NAV 2017/2016. It came as a UK version of NAV and it came with BACS functionality. Business Central that’s been taken away and they put in the international standards instead.

So you need to decide how are you going to get your BACS file? And you’ve got two options. You can ask your partner. That’s TVision in this case, to give you an extension or change your code to put BACS file functionality onto your Business Central system.

Or you could go to the marketplace and you could look for an extension to do this for you from a third party. So if we just have a quick look you’ve got something like Envestnet, which Karen mentioned, this is a service that lets you download your bank statements. There are others that exist AMC banking. There’s one called IDYN. These are third party solutions, I cannot endorse any of them.

You would have to do your due diligence check those companies make sure that they’re suitable for you. If you want to use them, and these services generally they charge you a monthly fee to use their service to transmit and receive files from your bank. And they act as an intermediary translating everything into the correct formats. You will notice there are some other options on here that jump out PayPal and Worldpay.

So if you’re a cutting-edge company and you’ve got a PayPal account, you can start using that integrated functionality as well. Let’s come back. We assume that we’ve made our decisions. So we chose BACS (TVision have put BACS functionality on for us). So now we can start processing some transactions. So I’m going to go to a payment journal first of all.

And you notice there are a lot of different payment journals. You can create as many as you need in this case. We’re just going to use this top one called Bank.

Important things if I want to export a file to upload to the bank, I need to make sure that I’ve ticked the option to allow this and also if I’m going to allowed that differences etc., just make sure that I take all the correct options. Let’s go in and have a look.

Okay standard payment journal, you can type in the vendor that you want to pay the amount that you want to pay etc., or you can use Business Central functionality and let the system suggest vendor payments automatically based on document due dates and any filters that you might put in down here. So I’m just going to look for something where the currency code is in pound sterling.

Two empty quotes just says where there’s nothing there.

And I let it go and find any payments just so we’ve got something to look at.

It’s come back with three suggested payments. You will notice on any one of these lines. It’s asking for something here in the payment method code. So if you’re paying by BACS you would select BACS from this list, you’ll notice this is a default system, so BACS is not there.

There’s the bank conversion services for domestic and international, if you’ve installed any of those other options, AMC or IDYN etc., their option will appear here. You can choose which option you want to use. So you choose the correct option, BACS, BACS, BACS in this case. This is not a real bank account not a real company. So if I try and export a file here it is going to fail, but once you’ve selected that you go to bank and you would say export.

I get an error message because it’s not a real bank. It was it would just ask you where do you want to save the file? And then you’ve got the file that you can upload onto your online banking or transmit to your bank using whichever method you use and you can post this document to post the payment.

Pretty straightforward. One important thing to remember, if you have transmitted that file if you’ve exported it, you’re going to see a tick appear in the exported column. Once it’s ticked. If you then decide you want to change one of the lines, Business Central is going to start throwing up warnings to say that you’ve already exported this or you really sure you want to do it. It’s just trying to save you from making a mistake. If you want to avoid this entire batch, you don’t want to transmit that file to the bank then you can always come along and you can void that export which will turn off those ticks.

Let’s the system know that you’re not going to transmit to the bank. So it’s not going to complain if you make changes. Once you’ve made any changes you’re happy you can then export once again.

So that’s payment journal. It’s pretty straightforward. If you’ve chosen BACS, you would have had the option there for BACS. You would have said download and sent it off to the bank. There are some slightly newer options. If you enroll with one of the other services, you can transmit the file directly to the bank from within Business Central, all that’s doing is taking out that middle step, so you’re not downloading the file and then uploading it.

You’re directly transmitting it to the bank, some of those third-party services allow you to do that.

The second thing I would like to talk to you about is, the other side of that transaction is, receiving money from your customers. So let’s go back to my home screen, and it works in pretty much the same way – instead of payment journals cash receipt journals.

Again as many batches as you need, we’ll just look at this top one.

I’ve already got a transaction that I put in here a little earlier, and you will notice in a default system, there is no Bank button. So you don’t need to transmit anything to the bank when a customer is paying you. However, if your company collects direct debit payments from your customers, you could ask TVision to give you that same functionality on your Cash Receipts Journal, so you get the bank button which would give you the option of downloading a direct debit x file. Which you could send to the bank to instruct the bank to collect money on your behalf. And we would also add the functionality for ‘suggest customer payments’, which would use that same logic, go through all the customers’ accounts, see who’s got anything that’s doing the date range, and suggest them in here so that you can download load and give to the bank.

The same rules would apply for downloading a direct debit x file as for a payment BACS file. It would work in exactly the same way.

So that’s making payments and receiving payments. Another thing that you occasionally might want to do is transfer money from one of your bank accounts to another one of your bank accounts – and that can get fun. Especially if they’re in two different currencies. So maybe you want to transfer some pounds into your US dollar account.

Let’s just have a look at this journal that I set up.

Now the interesting thing when I’m moving from one currency to another currency, you’ll notice I’m splitting this over two lines. I am not putting in a balancing bank account. So intuitively you might feel that you put in £650 pounds, the balancing account is my US dollar account and it’s going to turn that into a thousand dollars. So you might want to try and put it in there, the moment you put your US dollar account in this cell. It’s going to put a currency code of US dollars.


And Business Central is going to get really confused, because then it doesn’t know is this pound sterling is this US dollars? So it’s just not going to let you do that, it forces you to split the transaction over two lines – one line for the pounds one line for the US Dollars.

When I entered a thousand dollars, it came up with a Sterling equivalent to six hundred forty eight pounds. Not quite the same as a 650 pounds that I’m actually transferring. So I can see on this journal, there is a one-pound eighteen pence difference.

That needs to be accounted for somewhere and I’m not going to be able to post this journal until I correct this. I’ve got a couple of options. I can manually force this number to be 650 pounds, what that’s going to do, that’s going to, instead of using the system’s exchange rate, it’s going to use a spot rate of 650 to 1000 just for this transaction. Then your next transaction, it’s going to go back and carry on using the exchange rate on your system. The other alternative is to put in a balancing line to say where this one-pound eighteen pence has gone to so you would probably if you wanted to do it that way say it’s going to a general ledger account and usually right at the bottom of your general ledger you have foreign currency gains and losses accounts. In this case, we’re paying 650 when we should pay 648 so it’s a loss.

So I will put it into that account. I hope I got that the right way around, and I will put in the amount in pound sterling, is 8. We can now see that my journal balances, so I can transfer my 650 pounds to $1,000, one pound and 18 lost to an exchange rate fluctuation.

I did type that line manually, if your system is set up correctly and you’ve put in all the default accounts, you can ask the system to insert rounding line if there are any rounding errors as well.

In this case, there is no rounding error, but it was a penny off it would add another line to say the penny’s gone to a variance account. At this point I can post this transaction and I would see the 650 pounds out of my GBP account $1,000 into my USD account.

So that’s your foreign currency transfers between bank accounts. If you’re paying your vendors in foreign currencies, if you’re receiving money from your customers in foreign currencies, you just use a normal payment journal or cash receipt journal, it works and it uses that default exchange rate. Last thing I want to talk about is your bank account reconciliation.

So come the end of the month, or if you’ve got a very busy bank account you might do it at the end of every week – or even a couple of companies I’ve worked for they’ve done it every day. Reconciling that bank account against what’s on your system just to make sure that everything is where it should be. So let’s go and have a look at a bank account reconciliation.

Bank account reconciliations. We’ll ignore these two that exists here now, we’ll create a new one. Basically, you tell it which bank account you’re going to reconcile, you choose from the list.

This is the first statement for this account. What is the date of the statement? Today’s date. The last statement was at zero point zero zero because it’s new account. There was nothing there, and I simply tell the system what is the balance according to the bank statement at the end of this period – $1,000.

And you’ll notice this is my USD account. I’m inputting my transactions here. My reconciliation in US Dollars not in pounds sterling.

At this point the system is picked up any transactions that it can find within the date range, to say this is what it thinks the bank statements going to tell it. On this side, this is where my bank statement goes. There are three ways I can get my bank statement into this side, one way if I’ve got a paper copy of my bank statement. I can manually line by line type in exactly what my bank statements is.


For small bank account you might be happy to do that. If you’ve got a busy bank account, you probably not keen on taking that approach.

Another option is to let the system suggest what it thinks should be in the bank statement. Which is ‘suggest lines’, if I click ‘suggest lines’, the system is going to take everything that it knows about, and it’s going to put it here and say I assume this is what’s on your bank statement. Let’s do that.

And it automatically matches them off by making, you can see they’re matched off because they’ve been made green, and there’s the tick in the applied box. And we can see that there is no difference. So that’s a second way of bringing it in. But if there was a difference on my bank account, I could still add that remaining line perhaps there’s some Bank charges some interest or something that I just want to add in here.

A third option for getting your bank statement in here, is to actually import your bank statement. Once again, if you’re with a local bank, you can ask TVision to set this up with your bank’s format. So you download a file from your bank or your online banking portal you save it and then you can import it into the system.

This one’s not going to work because as I said, it’s not a real bank account. But if you had that it would then upload your bank statement here and you would be able to reconcile the entries on this side with the entries on this side.

I’m going to go out to this one, and I’m going to open a much more interesting bank reconciliation.

This one’s a lot busier. There’s a lot more transactions and you will notice that the balance according to my bank statement ends with 89.20. The balance according to Business Central ends with 7920. So there is a 10 pounds difference between what Business Central knows about, and what is on this bank statement that we imported. If you’re eagle-eyed, you can already see it down there.

But we might need to go match everything off to see where the differences are. There are two different ways that you can match things off. So you can scroll down this list find a transaction. So I found this 24,000 over here and I found the matching 24,000 on this side. And I can manually match them and that will tick them off against each other. And I can do this for each line, find the matching entry, highlight them both, manually match, and that ticks them off. When I’m finished, anything that’s not highlighted, is something a difference that needs reconciling.

As Karen mentioned there is the ability to match automatically as well.

So if I choose this option, it asks me for a date tolerance, so I can put in, for instance, One D, anything where it’s got the same amount on both sides for the same date, it will automatically match.

If I change this to 2D, then it would allow a two day difference between the dates on either side, as long as the amounts are the same, it would automatically match. So for this one, I’m going to make it one day, you can make that as many days as you want depending how quickly your bank processes transactions, and how quickly you enter those transactions onto your system. So I’ll just say okay.

Okay, so it’s managed to match up everything on this side. It’s all green. It’s managed to match up everything on this side except for this 10 pounds difference.

So I’m missing a transaction in Business Central that my bank says I should be aware of, it’s for Bank charges.

And again, I’ve got choices at this point. I can go out of this reconciliation. It will be saved in its current state, I can go and I can do a payment journal to post a transaction for these Bank charges.

They will then appear on this side of the reconciliation and I can manually match them off, or there’s a nice bit of automation if there were two or three lines here, I could, let me hope I can find it very quickly. There it is. Transferred to general journal, so anything that’s still outstanding, if I click this button, it’s going to create a general journal for me in order to post it quickly. So we click there, which general journal do I want to use, it’s going to use that payment general, which I think we’ve got some transactions in there from earlier, but I’ll use it anyway.

Nope. It’s a nice empty one. So it has created a line for me. It has put in the amount over here, the bank account that I’m reconciling, all that’s left for me to do is say which GL account number do I want these Bank charges to go to. I would choose the correct account.

Put in any narrative or any Dimensions that I might need, and I could then put this journal, and at that point when I reopened this I would have matching transactions on both sides. I could manually match or ask it to automatically match again. Once I’ve got a zero difference I can then post this reconciliation.

And I am finished. So those are the four main tasks you’re going to perform with your bank payments, receipts, transfers, and reconciliation. One nice trick that we haven’t mentioned so far. It’s not really a trick, one last thing that you can do, on your bank accounts.

We have set up all of our bank accounts here, and I would expect you probably want to have all of your bank accounts here, but you’re not just limited to bank accounts in your bank account list. You could have petty cash. You could add another bank account for your petty cash, and you could treat all your transactions through your petty cash tin as Bank transactions.

And then you can use payment journals, cash receipts journals to record when you’re going out of that tin, coming into that tin. At the end of the month, you could do a Reconciliation on that petty cash as an extra feature. Also, if you’ve got a company credit card account, you could set up that company credit card account as a bank account, and you could treat all transactions on that company credit card as bank account transactions.

And then you can use all of that functionality, reconciliations, transferring money into the account, when you want to pay off the credit card etc. You can use the standard built-in banking functionality. So those are the main points I wanted to show you I will pass you back to Karen.

Great, thank you, right if anybody has any questions if you’d like to submit them using the question box and we’ll try to answer as many as we can. So I’ll just give you a couple of minutes for that.

Okay, we’ve got one here in, can I set up a bank import or export from more than one Bank?

Yep, that’s very possible. So quite a few of our clients, they might bank with one account at HSBC and other account at Barclays Bank. You can set up two different banks on your system with two different bank export file formats. We can help you with that. It’s not a problem. We’ve done it for plenty of clients.

Okay and Karen, system handle transfers from one foreign account to another foreign account. Okay, what I showed you in that demo was transferring from my local currency pound sterling to US Dollar account. There’s nothing that stops you transferring if you’ve got a Euro account to the US dollar account transferring money between those two banks. The system will use the two exchange rates. It will record everything in Pounds Sterling on the GL. And again the same rule applies. You’d have to put both lines of that transaction on a separate line in the journal. You can’t use a balancing account because both lines are in a different currency.

So it would work in exactly the same way.

All right. Thanks, right. So I’m now just going to talk about the 5 key takeaways about banking which will hopefully assist you. So have a think about how many transactions and payments do you have is it actually worth the time to set up an automated process, and how automated you want things to be? Are you happy with the solution also matching versus the bank statement?

Would you prefer TVision to do the work needed or would you prefer to have a third party solution for automation? What’s the time and cost benefit of setting up an automated exchange rates as opposed to just manually changing them when you need to. And how are you going to record any exchange rate gains and losses? So we have you found this webinar interesting and informative. As mentioned, it is the 17th in the series of webinars. We will be sending an email soon to register for the next.

And if you want to just take a quick look to see what the next couple are coming up. If you do want to look at the recordings for any previous ones that are on our website. If you go to learn and go to webinars go halfway down the page go to webinar recordings will find them there.

Okay, so thank you for attending. When I close this session a survey will appear and be great if you could respond with some feedback. If there are any unanswer questions, we will answer you directly afterwards. Thank you very much. Thanks guys. Bye.

You can view another of our webinars in the series here. Alternatively click here to learn more about Business Central, or get a quote with our Estimate Generator.