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Administrator Guide
Last Updated: 2023-06-23
Define Cash Balancing Rules for Cash Transactions

Define Cash Balancing Rules for Cash Transactions

  • Process all open transactions and payments that generate cash accounting.
  • Security:
    Set Up: Worktag Balancing
    domain in the Common Financial Management functional area.
You can create a cash balancing rule to associate a primary balancing worktag to a bank account. Example: A specific fund or pooled cash funds as a primary balancing worktag. When you add this rule to your worktag balancing transaction rule set, Workday:
  • Derives the balancing worktag defined in the rule on cash accounting entries.
  • Generates interworktag payable and receivable journal lines to balance at the bank account level.
You can generate interworktag entries at the time of settlement to reflect accurate balances for cash balance checks or financial reports. When you use this rule, you no longer need to create manual journal entries to balance between funds at period close.
  1. Access the
    Create Cash Balancing Rule
     task.
  2. As you complete the task, consider:
    Option Description
    Worktag Type
    Worktag types are groupings of worktags by a business dimension: Cost center, business unit, region, fund, and custom organization. Select the type to use to balance journals for transactions subject to this rule.
    Your choice determines the worktags available for selection within this balancing rule.
    You can use only 1 balancing worktag type for all companies.
    Note that when the cash balancing rule is
    In Use
     as part of your worktag balancing configuration, you can't change the worktag type.
    Default Option
    Default Value
    The
    Default Option
     applies to all bank accounts except for accounts specified in the
    Balancing Worktag Offset
     grid. Select to either:
    • Inherit
       the same balancing worktag as the operational transaction side (spend or revenue). The offset journal lines automatically balance by the balancing worktag value of the transaction.
    • Specify
       a default balancing worktag value to use.
  3. (Optional) In the
    Balancing Worktag Offset
     grid, map a specific bank account to a primary balancing worktag. Workday applies the balancing worktag to the cash entries with the matching bank account worktag.
  4. To add the cash balancing rule to your worktag balancing transaction rule set, you:
    1. Edit the worktag balancing transaction rule set.
    2. Select the
      Always Inherit
       check box for all worktag balancing transaction types in the
      Financial Transaction Types
       grid.
      The transaction accounting entries will inherit the balancing worktag from the offset lines. This prevents Workday from generating the due to and due from entries at the time of accrual.
    3. Clear
      Always Inherit
       in the
      Cash Transaction Type
       grid.
    4. Select the cash balancing rule to apply it to all cash entries associated with a bank account.
Workday uses the primary balancing worktag to create interworktag balancing entries when generating cash accounting or settling cash transactions for each bank account. Any predefined optional balancing worktags also display on the interworktag balancing entries.
Workday overrides any balancing worktags defined in the financial balancing rule with the bank account worktag defaults for:
  • Ad hoc bank transactions
  • Ad hoc payments
  • Miscellaneous payment requests (cash basis accounting)
  • Prenote payments
For bank account transfers and transfers for settlement, Workday derives the associated balancing worktag when generating the transactions.
Your proposed amount of $100,000 for your project that uses Fund A is approved for budget. You receive a federal grant of $100,000 for the approved budget in your Treasury Fund. This intermediary fund assigned to the Treasury bank account pays and receives on behalf of other funds. In turn, Fund A has a claim on cash with the Treasury Fund.
When you create the customer invoice for the federal agency, Workday uses the worktag balancing transaction rule to generate accrual accounting entries with the inherited
Fund A
 worktag:
Ledger Account
Debit
Credit
Worktag
Accounts Receivable
100K
Fund A
Revenue
100K
Fund A
When you receive the grant, you record the customer payment and apply the payment to the agency invoice. Workday generates the cash entry with the
Treasury Fund
 worktag mapped to the Treasury bank account defined in the cash balancing rule. Workday also generates initial claim on cash (interworktag) entries between the
Treasury Fund
 and
Fund A
 worktags:
Ledger Account
Debit
Credit
Worktag
Cash
100K
Treasury Bank Account
Treasury Fund
Accounts Receivable
100K
Fund A
Claim on Cash
100K
Treasury Fund
Claim on Cash
100K
Fund A
You expend the grant funds and record a supplier invoice for Fund A. Workday uses the worktag balancing transaction rule to generate accrual accounting entries with the inherited
Fund A
 worktag:
Ledger Account
Debit
Credit
Worktag
Spend
100K
Fund A
Accounts Payable
100K
Fund A
When you settle the supplier invoice, Workday generates the cash entry with the
Treasury Fund
 worktag mapped to the Treasury bank account. Workday also generates claim on cash entries to balance between Treasury Fund and Fund A:
Ledger Account
Debit
Credit
Worktag
Interworktag Affiliate
Accounts Payable
100K
Fund A
Cash
100K
Treasury Bank Account
Treasury Fund
Claim on Cash
100K
Treasury Fund
Fund A
Claim on Cash
100K
Fund A
Treasury Fund
To help ensure manual cash accounting entries post with the correct balancing worktag, use the
Worktag doesn’t match Cash Balancing Rule
 report field to create:
  • A custom validation to inform you when a manually entered balancing worktag on a cash journal line doesn't match the rule definition.
  • A custom report to identify manual cash journal lines with a bank account and balancing worktag that doesn't match the rule definition.