Optimising Cash Flow: A Guide to SAP Open Item and Customer Clearing

Effective cash flow management begins with efficient customer clearing and open item clearing. 

For SAP-driven organisations, the speed and accuracy of cash application directly impact working capital efficiency, customer relationships, and overall financial performance. 

Our guide explores how advanced clearing techniques and automation transform traditional cash application processes into strategic cash flow optimisation tools.

Understanding SAP Open Item Clearing

Open item clearing in SAP involves matching and clearing outstanding transactions across different accounts and company codes. Traditional SAP limitations prevent automated clearing across different company codes or General Ledger accounts, creating bottlenecks that delay financial reporting and impact cash flow visibility.

BEST’s open item clearing module overcomes these standard SAP limitations by automatically matching and clearing items across multiple companies and account types without manual effort. The solution uses intelligent matching algorithms that rapidly process items based on user-defined criteria on any account field.

Key open item clearing features:

• Customisable clearing rules: Define flexible clearing criteria that accurately reflect your business processes, enabling automated processing of routine transactions.
• Intuitive user interface: Easily modify references, search fields, and group items for streamlined open item clearing operations.
• Inter-company clearing: Automate matching and clearing across different company codes, particularly valuable for inter-company trade reconciliations.
• Inter-account clearing: Automate matching and clearing across different General Ledger accounts, essential for interface accounts from retail, payroll, and other external systems.

Benefits of automated open item clearing

• Improved operational efficiency: Automated bulk clearing eliminates manual intervention for routine transactions, enabling staff to focus on exception handling and analysis.
• Faster period-end closing cycles: Automated processing significantly reduces the time required for month-end clearing activities, accelerating financial close timelines.
• Sharp visibility into unreconciled items: Real-time processing provides immediate visibility into outstanding items requiring attention.
• Reduced compliance risk exposure: Automated processes ensure consistent application of clearing rules while maintaining comprehensive audit trails.

Advanced Customer Clearing in SAP

Customer clearing automation represents a critical component of cash flow optimisation. BEST’s customer clearing module streamlines cash application by automatically uploading customer payment advice into SAP and matching remittances to open receivables.

Customer clearing capabilities:

• Comprehensive automation: The solution covers clearing across customers and company codes for single remittances, eliminating manual processing requirements.
• Customer account determination: Advanced algorithms automatically identify customer accounts based on remittance line item details, reducing matching time and improving accuracy.
• Robust validation: Comprehensive validation processes ensure accuracy by validating remittance lines against SAP records throughout the clearing process.
• Easy exception handling: User-friendly tools manage residuals and short payments, ensuring smooth processing even in complex scenarios.

Benefits of automated customer clearing

• Complete visibility into open Iiems: Real-time dashboards provide comprehensive visibility into outstanding receivables and clearing status across all customer accounts.
• Accelerated order-to-cash cycles: Automated matching and clearing significantly reduce the time between payment receipt and cash application.
• Reduced days sales outstanding (DSO): Faster payment processing directly impacts DSO metrics, improving working capital efficiency.
• Time and cost savings: Automation enables receivables personnel to focus on exception management rather than routine data processing.

Enhanced Processing Capabilities

The BEST customer clearing module includes sophisticated features that address complex processing requirements:

• Batch manager integration: Efficiently manage large volumes during peak periods, optimising processing capabilities for high-transaction environments.
• Statistical reporting: Detailed reporting provides insights into customer clearing statistics, enabling continuous process improvement and performance monitoring.
• Advanced matching algorithms: Sophisticated algorithms ensure high straight-through processing rates while maintaining accuracy standards.

Cash Flow Optimisation Through Efficient Clearing

Effective clearing processes directly impact cash flow management through several mechanisms:

• Accelerated cash recognition: Faster payment application improves cash visibility and enables more accurate cash flow forecasting.
• Enhanced working capital management: Automated processing reduces the cash conversion cycle, improving overall working capital efficiency.
• Reduced processing delays: Elimination of manual bottlenecks ensures timely cash application and accurate financial reporting.
• Improved customer relationships: Accurate, timely payment processing reduces customer queries and enhances account management efficiency.

The transformation from manual to automated clearing represents a fundamental shift in cash flow management capability. It enables finance teams to focus on strategic cash optimisation rather than transactional processing while achieving significant operational efficiencies across both open item and customer clearing functions.

Looking to simplify open item clearing in SAP with BEST? Click here to book a demo.