Record Letter of Credit Draw Downs

Administrator Guide

Create a bank routing rule for your company.

Create a letter of credit for your sponsor with the bank account on the bank routing rule.

Create and approve an award with the letter of credit on the award header. Create and approve the billing schedule for the award.

Complete and settle expenses for the grant.

Create customer invoices for the grant transactions.

Configure the Letter of Credit Draw Down Event (Default Definition)
business process and security policy in the Grants Management functional area:

To record details from the draw request such as draw request date and confirmation number, add the Record Draw Request
action step before the Record Amount Received for Letter of Credit Draw Down
step.

To record payment amounts that are different from draw amounts, add the Adjust Amount Received
action step after the Record Amount Received for Letter of Credit Draw Down
step.

To route the Adjust Amount Received
action step to the initiator only:

On the business process security policy, configure the security groups on the Adjust Amount Received
action step as the security groups for the Record Letter of Credit Draw Down
initiating action, and add the Initiator user group.

On the business process definition, add the Initiator to the security groups on the Adjust Amount Received
action step.

You can record a letter of credit drawdown of claimed award expenses from federal grants, contracts, and cooperative agreements. The drawdown includes expenses for all awards with the same letter of credit for a company or company hierarchy. For multicompany awards, the letter of credit drawdown aggregates all billable expenses for the award across companies.

When you record a letter of credit drawdown, Workday creates an association between the drawdown and the specific sponsor invoices that make up the draw amount. See Concept: Associating Sponsor Invoices with Letter of Credit Drawdowns for more detail.

Before recording a drawdown, you can preview the amounts to draw and export the drawdown lines by accessing the

Pro-Forma Letter of Credit Draw Down

report.

Access the

Record Letter of Credit Draw Down

task.

As you complete the task, consider:

Option	Description
Company	Select a company hierarchy if you want to draw down for multiple related companies at once.
Sponsor	The sponsor on the letter of credit and the bill-to sponsor on the awards that use the letter of credit.
Letter of Credit	You can only select from the letters of credit for Sponsor .
Exclude Zero Amount to Draw	Select this check box to display only drawdown lines with non-zero unpaid billed amounts.

As you review the

Letter of Credit Draw Down Lines

tab, consider:

Option	Description
Draw ID	The letter of credit draw ID associated with 1 or more billing schedules on the award. Each draw line corresponds to 1 draw ID. Workday first groups award lines by award, then by draw ID for each award, even when the draw IDs are shared across multiple awards. For award lines that aren't associated with any draw IDs, Workday groups them into 1 draw line for each award, with a blank draw ID. This column doesn't display when none of the awards use a letter of credit draw ID.
Award Lines	Award lines that are associated with the draw ID through their billing schedules, or award lines that aren't associated with any draw IDs, for each award.
Line Amount	The sum of line amounts on award lines associated with the draw ID by award, or with the award when there's no draw ID. This value is for your information only and won't impact your spend processing.
Cost-Reimbursable Expense	The total cost-reimbursable expense for the draw ID by award, or for the award when there's no draw ID. This amount includes the direct spend amount and facilities and administration costs. This column only displays when there are cost-reimbursable expenses for awards on the letter of credit.
Invoiced Amount	The total amount already invoiced in approved customer invoices and customer invoice adjustments for the draw ID by award, or for the award when there's no draw ID.
Total Amount Paid	The total amount paid in previously completed drawdowns for the draw ID by award, or for the award when there's no draw ID.
A/R Balance	The difference between the Invoiced Amount and the Total Amount Paid .
Available Draw Amount	The amount that’s available for you to draw down from a letter of credit. Workday calculates this amount by taking the total value of all eligible invoices and subtracting the amounts that are either partially paid or already allocated to in-progress draws. When a reviewer sends back an in-progress drawdown, Workday recalculates this amount to include any new eligible sponsor invoices created since the business process was initiated. Sponsor invoices that are installment invoices must have a billing schedule on the invoice to be included in this amount.
Pending Draw	The total amount still in progress from previous drawdowns for the draw ID by award, or for the award when there's no draw ID.
Amount to Draw	Enter the amount you want to draw for the draw ID by each award, or for the award when there's no draw ID. Workday populates this field with the difference between the A/R Balance and Pending Draw amounts. The amount you specify can't exceed the Billing Limit amount. When you edit the amount, Workday associates the drawdown with eligible sponsor invoices based on the amount on the invoices and the specified amount to draw. Sponsor invoices that are installment invoices must be associated with a billing schedule to be eligible. You can overdraw by specifying an Amount to Draw that's more than the Available Draw Amount , but Workday only associates the available invoice amounts with the eligible invoices, leaving the excess draw amount to be manually applied to other invoices. See Reapply an Unapplied Customer Payment.

(Optional) To review the total draw amount for awards on the letter of credit, access the

Award Totals

tab.

As you review the

Award Totals

tab, consider:

Option	Description
Billing Limit	Workday limits your drawdown amount based on these settings on the award header: Billing Limit Override . Authorized Amount , when Billing Limit Override isn't defined. The billing limit on the billing schedule, if defined, doesn't apply to letter of credit drawdowns.

(Optional) To review the total draw amount for companies on the letter of credit, access the

Company Totals

tab.

The Letter of Credit Draw Down Event
business process routes the transaction to these steps:

Step	Details
Initiation	Workday associates the letter of credit drawdown with the eligible sponsor invoices that comprise the Available Draw Amount at the time of recording.
Review Letter of Credit Draw Down	This step enables you to override the default draw amount. When you change Amount to Draw , Workday recalculates Available Draw Amount and either pulls in new eligible sponsor invoices or drops existing invoices from the associated list of invoices. See Concept: Associating Sponsor Invoices with Letter of Credit Drawdowns Once this step is approved, you can contact the sponsor and request payment.
Record Draw Request	This step enables you to record the: Date that you submit the draw request on the external payment system. Confirmation number that you receive from the external payment system acknowledging the draw request.
Record Amount Received for Letter of Credit Draw Down	This step enables you to enter the amount and date for payment received from the sponsor. To enter an amount received that's less than the total amount drawn, the business process definition must contain the Adjust Amount Received step after this step. To better align with standard drawdown practices, you can't record an amount received that's more than the total draw amount.
Adjust Amount Received	This step enables you to adjust the amount received on each award line so that they sum up to the total payment amount received. Workday only routes to this step when the total amount received entered is different from the total amount drawn. Before you proceed, ensure that the: Total Amount Received on the header equals the sum of Amount Received on all draw lines. Amount to Adjust on the header is equal to zero. When you adjust the amount received on each drawdown line and submit this step, Workday refreshes the list of associated sponsor invoices one last time, finalizing the list for remittance advice generation.
Auto Apply Letter of Credit Draw Down Payment	This required completion step automatically applies payment for the drawdown and generate remittance advice against the associated sponsor invoices. Workday only applies payment for the drawdown after the: Approval step. Adjust Amount Received step when there's no Approval step. Record Amount Received for Letter of Credit Draw Down step when there's no Approval or Adjust Amount Received step. During payment application, Workday: Creates the corresponding customer payment and customer deposit. Applies the customer payment against the award invoices. Creates the accounting for the drawdown.

If you update the remittance advice manually outside of the Letter of Credit Draw Down Event
business process, ensure that you run the payment application to update the association between the letter of credit drawdown lines and sponsor invoices.

You can access the:

Letter of Credit Draw

report to view all letter of credit drawdowns for a company and export data for third-party reporting.

Letter of Credit Draw Down Lines and Linked Sponsor Invoices

report to view drawdown details for a specific letter of credit or drawdown, especially the sponsor invoices associated with the drawdowns.

Schedule Record Letter of Credit Draw Down

task to schedule future letter of credit drawdowns.

To cancel a letter of credit drawdown event after you submit it, access the Letter of Credit Draw Down Event
business process event from My Tasks under