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    Cash Transfer Methods: Berito, Quennie Bernal, Jessamie Cacho, Carmina

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    Jewelyn Ciocon
    This document discusses various cash transfer methods including their advantages, disadvantages, and controls. It covers check payments and the check processing flow. It also discusses wire transfers, ACH payments, letters of credit, procurement cards, and cash payments. For each method it provides details on how the method works and considerations around fees, timing, and uses. It also provides examples of controls that should be implemented for different cash transfer methods to prevent fraud and ensure accurate payments.

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    © All Rights Reserved
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    Cash Transfer Methods: Berito, Quennie Bernal, Jessamie Cacho, Carmina

    Uploaded by

    Jewelyn Ciocon
    73 views26 pages
    This document discusses various cash transfer methods including their advantages, disadvantages, and controls. It covers check payments and the check processing flow. It also discusses wire transfers, ACH payments, letters of credit, procurement cards, and cash payments. For each method it provides details on how the method works and considerations around fees, timing, and uses. It also provides examples of controls that should be implemented for different cash transfer methods to prevent fraud and ensure accurate payments.

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    Group 2 Module 2

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    This document discusses various cash transfer methods including their advantages, disadvantages, and controls. It covers check payments and the check processing flow. It also discusses wire transfers, ACH payments, letters of credit, procurement cards, and cash payments. For each method it provides details on how the method works and considerations around fees, timing, and uses. It also provides examples of controls that should be implemented for different cash transfer methods to prevent fraud and ensure accurate payments.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    73 views26 pages

    Cash Transfer Methods: Berito, Quennie Bernal, Jessamie Cacho, Carmina

    Uploaded by

    Jewelyn Ciocon
    This document discusses various cash transfer methods including their advantages, disadvantages, and controls. It covers check payments and the check processing flow. It also discusses wire transfers, ACH payments, letters of credit, procurement cards, and cash payments. For each method it provides details on how the method works and considerations around fees, timing, and uses. It also provides examples of controls that should be implemented for different cash transfer methods to prevent fraud and ensure accurate payments.

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    Cash Transfer Methods

    Module II

    Berito,
    Berito, Quennie
    Quennie
    Bernal,
    Bernal, Jessamie
    Jessamie
    Cacho,
    Cacho, Carmina
    Carmina
    Check Payments
    A check payment is made on a paper
    document, which has traditionally been
    physically routed from the payer to the
    payee, to the payee’s bank, and then back to
    the payer’s bank.
    Check Process Flow
    Check is Payer’s bank
    Payee’s bank
    Payee transmitted transfer cash Payer’s bank
    sets value Payer’s bank
    Payee records to payers to payee’s credit
    Payer issues date for debits
    check receives check and bank bank payee’s
    entry in payer’s
    check deposits at through through account on
    payee’s bank account
    bank settlement settlement value date
    balance
    system system
    Mechanics of Check Payment

    Processing Presentation Availability


    Mail float
    Float Float Float
    CHECK PAYMENTS
    THROUGH A LOCK BOX
    Remote Deposit Remote
    A company can have Capture Disbursement
    it’s bank receive and
    • Allows a A float concept can
    process checks on its company to also be applied to a
    behalf, which is avoid the company’s
    termed a lockbox physical payments. The key
    service. movement area that can be
    of received lengthened is the
    checks to its presentation float.
    bank.
    Wire Transfer
    A wire transfer is a way of sending funds to the
    recipient’s bank account more easily than any
    other form of payment, and is mostly used in
    international payment.
    The following information are
    needed in wire transfer:
    The following information are needed in
    1
    wire transfer:
    2 Recipient’s name and account number
    Recipient bank’s name and bank
    3
    identification number
    4 Amount of the payment
    How does wire transfer work?
    What is ACH Payments
    The ACH is an electronic network for the
    processing of both credit and debit transactions
    especially in the United States and Canada. ACH
    payments include:

    • direct deposit payroll,


    • Social Security payments,
    • tax refunds,
    • bills
    What is ACH Payments
    ACH Debits Global
    ACH Payments

    The existing global ACH payment system is not


    perfect. Here are two limitations that are of
    particular concern:

    • Limited coverage.
    • Limited remittance information.
    Letters of Credit
    Procurement Cards
    It is a type o company charge card used in
    making smaller purchases for greater cost
    efficiency, control and convenience. It is also
    known as purchasing cards and PCards.
    System of Managing
    Procurement Cards
    ItIt is
    is important
    important to
    to The
    The employees
    employees cancan
    understand
    understand how
    how simply
    simply charge
    charge the
    the
    they
    they can can be
    be used
    used items
    items to
    to their
    their
    by
    by aa company.
    company. pcards.
    pcards.

    The
    The employees
    employees are
    are
    ItIt is
    is use
    use aa
    expected
    expected to
    to follow
    follow
    replace
    replace checks
    checks to
    to
    the
    the companies
    companies
    make
    make payments.
    payments.
    policies.
    policies.
    Advantages of P-card
    1 Information

    2 Convenience

    3 Efficiency

    4 Rebates
    Cash Payments
    It is a bills or coins paid by the recipient of
    goods or services by the provider. It can also
    involve a payment within a business to
    employees.
    Advantages of Cash Payments

    No Security
    1
    breaches

    2 No overspending

    3 Less Marketing
    Fees for Cash Transfers
    The fees charged by the banks vary
    considerably for different types of cash
    transfers.
    Cash Transfer Methods
    ADVANTAGES DISADVATAGES PRIMARY USE

    Automated Clearing Assured delivery on


    House Debit scheduled date Risk of fraud Recurring payments

    Requires setup, so not


    Automated Clearing Low cost and efficient
    as efficient for one- Corporate payables
    House payment processing time pays.

    Payment requires time


    Bank check Less efficient process Corporate payables
    to clear.

    Low cost and fast cash Payments between


    Book transfer accounts at the same
    transfer
    bank
    Requires strong
    Cash controls and expensive Retail sales
    to handle
    Cash Transfer Methods
    ADVANTAGES DISADVATAGES PRIMARY USE

    Timing is under the


    Payment may not clear
    Company check control of the payer and has a less efficient Corporate payables
    and the payer takes
    process.
    advantage of float.

    Administratively International
    Letter of credit Secure for the seller
    tedious payments

    Consolidate small Significant fee for cash


    Procurement card Retail and small sales
    billings recipient

    Can experience delays Large one time


    Relatively fast and in some countries and payments that are
    Wire transfer
    assured delivery it requires more required on short
    manual processing. notice.
    Controls for check Payments

    The following controls should be used to create and monitor check payments:
    Controls for Remote Deposit
    Capture
    Controls are needed in converting the checks to an electronic format
    Controls for Electronic
    Payment
    The controls for electronic payments:
    The following controls address these additional issues in electronic
    payments such as unauthorized account debits and potentially
    incorrect or fraudulent payments.
    Controls for Letter of Credit
    The following controls should be implemented prior to finalizing a letter of credit:
    The following controls involves the creation of the seller’s invoice to
    the buyer, to ensure that it will be acceptable to the bank:
    Thank You
    Any Questions ?

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