What is cash concentration in SAP FS-AM-IM-CC - Cash Concentration?

SAP Term: cash concentration

• Component: FS-AM-IM-CC

• Component Name: Cash Concentration

• Description: Creation of payment orders that credit or debit accounts in an account hierarchy. The goal of the cash concentration is to keep the balances of the participating accounts within certain limits at defined times. The main account root account at the top of the account hierarchy takes the superfluous balances of the other accounts or clears any lack of coverage there. The cash concentration can either be run for a single master contract, or for a certain number of master contracts in a mass run. &EXAMPLE& A cash concentration can, for example, be used to specify that an account is to always have a certain minimum balance. Alternatively, it can be used to specify that the credit on an account is to be transferred at the end of each month to another account, for example, an investment account.

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• Key Concepts: 
  Cash concentration is a process used by companies to manage their cash flow. It involves the transfer of funds from multiple accounts into a single account, allowing for easier management and control of cash. This process is often used to reduce the cost of managing multiple accounts and to improve liquidity. 
  
  How to use it: 
  The FS-AM-IM-CC Cash Concentration component of SAP allows companies to manage their cash concentration process. It provides features such as automated payments, automated reconciliation, and reporting capabilities. It also allows companies to set up rules for when and how funds should be transferred between accounts. 
  
  Tips & Tricks: 
  When setting up the FS-AM-IM-CC Cash Concentration component, it is important to consider the company’s specific needs and goals. This will help ensure that the component is set up in a way that best meets the company’s needs. Additionally, it is important to regularly review the rules and settings of the component to ensure that they are still meeting the company’s needs. 
  
  Related Information: 
  The FS-AM-IM-CC Cash Concentration component is part of SAP’s Financial Services suite of products. Other components in this suite include Accounts Payable, Accounts Receivable, and Treasury Management. Additionally, SAP offers a range of other products and services related to cash management, such as Cash Flow Forecasting and Cash Flow Optimization.