Withdrawals processing

Purpose

To automate the processing, classification, and accounting of client withdrawals, ensuring accurate liability management, correct cash outflow posting, and proper recording of fees across all payment systems and currencies.

Data sources

1. Pending withdrawal requests: Newly created withdrawal instructions awaiting processing.
2. Previous-day withdrawals: Withdrawals initiated in earlier periods but requiring action or journal entries in the current period.
3. Processed withdrawals: Completed withdrawals with confirmed payment execution.
4. Chart of accounts: Defines mapping to liability accounts, fee income accounts, provider cash accounts, and unrealized payable accounts.

Key processing steps

1. Withdrawal classification

Categorizes each withdrawal into one of three operational stages:

• Pending – New withdrawals created during the current period
• Previous Days – Requests initiated earlier but still active
• Processed – Withdrawals completed and cash paid out

This classification determines the accounting treatment and journal entry type.

2. Unrealized payable management

Handles liability transitions between withdrawal stages:

• Reverses unrealized payables when pending withdrawals move into matched or processed status
• Debits unrealized payables upon final processing (cash outflow stage)
• Supports time-shifted workflows where unrealized amounts may originate in prior periods

3. Multi-currency and special asset handling

• Processes withdrawals in all supported currencies
• Incorporates currency-specific rules (e.g., USD, EUR, GBP, CHF, etc.)
• Selects provider accounts based on the user's chosen payment system (bank wires, PSPs, crypto networks, etc.)

4. Fee calculation and posting

Separates fee components from withdrawal amounts:

• Identifies client fees charged at withdrawal
• Posts fees to the correct fee income GL accounts
• Handles fee amounts in all currencies
• Produces clear fee-level detail in reporting and pivots

5. Journal entry construction

Produces journal entries for each stage:

Pending withdrawals

• Debit client payable
• Credit unrealized payable

Processed withdrawals

• Debit unrealized payable
• Credit provider cash / payment system account

Fee entries

• Debit client payable
• Credit fee income account

Outputs

• Journal entries: Complete JE sets for pending, previous-day, and processed withdrawals.
• Pivot tables: Summaries of withdrawals by status, currency, payment system, and fee category.
• Source data outputs: Cleaned and classified transaction-level withdrawal records.