This section contains details of the suggested accounting entries that can be set up, for the Murabaha MM module of Oracle FLEXCUBE. The details of the suggested accounting entries are listed event-wise in the following sections:
The following is an exhaustive list of events that can take place during the lifecycle of an MMM contract. In the subsequent paragraphs we shall examine the accounting entries and advices for each of the events listed below.
| Event Code | Event Description | Remarks | |||
|---|---|---|---|---|---|
| BOOK | Booking a contract (Mandatory) | All Types | |||
| INIT | Takedown or Initiation (Mandatory) | All Types | |||
| ACCR | Accrual (Mandatory for products with profit payment frequency) | All Types | |||
| LIQD | Liquidation (Mandatory) | All Types | |||
| CONF | Confirmation of contract | All Types | |||
| CAMD | Amendment | All Types | |||
| NOTC | Billing Notice Generation | Placements | |||
| ROLL | Rollover execution (treated as a liquidation + new booking) | All Types | |||
| REVC | Reversal (Mandatory) | All Types | |||
| REAS | Reassign User | All Types | |||
| RESD | Reversal of Residual Accrual | All Types | |||
| REVC | Contract Reversal | All Types | |||
| REVN | Rate Revision | All Types | |||
| REVP | Reversal of Payment | All Types | |||
| STCH | Status Change | Placements | |||
| VAMB | Value Dated Amendment Booking | All Types | |||
| VAMI | Value Dated Amendment Initiation | All Types | |||
| OFFR | Offer sent or accepted | All Types | |||
| GRNT | Guarantee sent or received | All Types | |||
| UIDB | Upfront Profit Booking | All Types | |||
| YACR | Yield Accrual | All Types |
The amount tags listed below are hard-coded in Oracle FLEXCUBE.
| Amount Tag | Description | ||
|---|---|---|---|
| PRINCIPAL | Principal Amount | ||
| PRINCIPAL_DECR | Decrease in principal on amendment | ||
| PRINCIPAL_FWD | Forward takedown amount | ||
| PRINCIPAL_INCR | Increase in principal on amendment | ||
| PRINCIPAL_LIQD | Principal Amount Liquidated | ||
| PRINCIPAL_ROLL | Principal Amount Rolled over | ||
| PRINCPAL_XFWD | Principal Amount Reclassified | ||
| PRINCPAL_XREV | Principal Amount Unclassified | ||
| ROLLOVER_AMT | Rollover Amount | ||
| PRINCPAL_ADDL | Additional Principal | ||
| component_LIQD_CY | Current year Unrealized accrual amount for a component | ||
| component_LIQD_PY | Previous year Unrealized accrual amount for a component. | ||
| <PROFIT_COMPONET>_ROLL | The outstanding profit will be stored in a bridge account | ||
| PRINCIPAL_ROIN | This is the principal of the rollover child contract. It equals the amounts of PRINCIPAL_ROLL and <PROFIT_COMPONET>_ROLL. | ||
| PRINCIPAL_ADDL | The incremental Principal amount that has to be paid to borrower in a Finance rollover | ||
| Component_UINT | Total profit amount for the contract for each component. It would also be used to book unearned profit amount adjustments, if any. |
In addition to these you can define amount tags as per your requirements for profit and charges that will be attached to the product.
| Accounting Role | Description | ||
|---|---|---|---|
| EIMDISCINC | Effc Int Based Disc Accrued Till Dt | ||
| EIMDISCRIA | Effec Int Discount to be Accrued | ||
| EIMPREMEXP | Effective Int Premium Expense | ||
| EIMINTADJPAY | Effective Int Par Payable | ||
| EIMINTADJEXP | Effective Int Par Expense | ||
| EIMDISCPIA | Effective Int Discount Paid In Adva | ||
| EIMDISCEXP | Effective Int Discount Expense | ||
| EIMPREMRIA | Effective Int Premium to be Accrued | ||
| EIMPREMINC | Effective Int Premium Income | ||
| EIMINTADJREC | Effective Int Par Receivable | ||
| CUSTOMER | Customer | ||
| Component_UID | Deferred income GL for booking the unearned profit amount |
Below, we have provided two separate lists of sample accounting roles. List I contains accounting roles that can be set up for a Placement product. List II contains samples of accounting roles that are applicable for a Borrowing product.
| Accounting Role | Description | Role Type | |||
|---|---|---|---|---|---|
| BROKEXP | Brokerage Expense | Expense | |||
| BROKPAY | Brokerage Payable | Liability | |||
| BROKPIA | Brokerage payable in advance | Asset | |||
| ASSETGL | Asset GL for Placements | Asset | |||
| FWDASSETGL | GL for Future Dated Placements | Contingent Asset | |||
| FWDASSETOFF | Offset for Future Dated Placements | Contingent Liability | |||
| INTERINC | Fixed Profit Rate | Income | |||
| INTERRIA | Fixed Profit Rate | Liability | |||
| PENL1INC | Penal Int on Ovd Principal | Income | |||
| PENL1REC | Penal Int on Ovd Principal | Asset | |||
| CHARGINC | Common Flat Amt W/o Slab | Income | |||
| ComponentUNRL | Unrealized Income | Income | |||
| ROLL_WASH | Bridge account to wash the original parent’s outstanding balances to the child contract | Asset | |||
| ComponentUID | The unearned profit amount for a profit component (Deferred Income GL). | Income |
| Accounting Role | Description | Role Type | |||
|---|---|---|---|---|---|
| LIABGL | Liability GL for Borrowings | Liability | |||
| FWDLIABGL | GL for Future Dated Borrowings | Contingent liability | |||
| FWDLIABOFF | Offset for Future Dated Borrowings | Contingent Asset | |||
| INTEREXP | Fixed Profit Rate | Expense | |||
| INTERPIA | Fixed Profit Rate | Asset | |||
| INTERPAY | Fixed Profit Payable | Liability | |||
| CHARGEXP | Common Flat Amt W/o Slab | Expense | |||
| FRTAX1_PAY | Tax payable role forFRTAX1 | Liability | |||
| FRTAXS_PAY | Tax payable role for FRTAXS | Liability | |||
| ComponentREAL* | Realized Income | Income |
* The ‘component’ is the ICCF component that you have created.
Note
In the accounting roles listed above the prefixes INTER (Profit), PENL (Compensation), BROK (brokerage), CHARG (Charge) FRTAX1 (Tax) and FRTAXS are ICCF components.
The suffixes stand for:
| AQP | Acquired profit payable | ||
|---|---|---|---|
| AQR | Acquired profit receivable | ||
| EXP | Expense | ||
| PAY | Payable | ||
| PIA | Payable in advance | ||
| REC | Receivable | ||
| RIA | Received in advance |
In the subsequent sections we have defined suggested accounting entries and advices for each of the events in the life-cycle of an MMM deal. Samples of accounting entries, advices, and events have been given for four different types of MMM deals. They are:
Note
Also note that some of the Amount Tag’s linked to the Accounting Roles are user defined.
The preferences set for this product are as follows:
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| CHARGINC | CHARG | Credit | |||
| CUSTOMER | CHARG | Debit | |||
| FWDASSETOFF | PRINCIPAL_FWD | Credit | |||
| FWDASSETGL | PRINCIPAL_FWD | Debit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MM_DEAL_SLIP | Deal Slip | ||
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 | ||
| PAYMENT_MESSAGE | Payment Message | ||
| MMCONPLA | MM Placement Confirmation |
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| INTERRIA | INTER_LIQD | Credit | |||
| CUSTOMER | INTER_LIQD | Debit | |||
| ASSETGL | PRINCIPAL | Debit | |||
| CUSTOMER | PRINCIPAL | Credit | |||
| FWDASSETGL | PRINCIPAL_FWD | Credit | |||
| FWDASSETOFF | PRINCIPAL_FWD | Debit | |||
| FWDASSETGL | PRINCIPAL_FWD | Debit | |||
| FWDASSETOFF | PRINCIPAL_FWD | Credit | |||
| ASSETGL | PRINCIPAL_ROIN | Debit | |||
| ROLL_WASH | PRINCIPAL_ROIN | Credit | |||
| ASSETGL | PRINCIPAL_ADDL | Debit | |||
| CUSTOMER | PRINCIPAL_ADDL | Credit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MM_CONT_ADV | Contract Advice |
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| INTERINC | INTER_ACCR | Credit | |||
| INTERRIA | INTER_ACCR | Debit | |||
| PENL1INC | PENL1_ACCR | Credit | |||
| PENL1REC | PENL1_ACCR | Debit |
Advices
No advices allowed for this event.
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| PENL1REC | PENL1_LIQD | Credit | |||
| CUSTOMER | PENL1_LIQD | Debit | |||
| ASSETGL | PRINCIPAL_LIQD | Credit | |||
| CUSTOMER | PRINCIPAL_LIQD | Debit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 | ||
| PAYMENT_MESSAGE | Payment Message |
Accounting Entries
Nil
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MMAMDADV | Amendment Advice |
Accounting Entries
Nil
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
Nil
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
No accounting entries allowed for this event.
Advices
| Advice Name | Description | ||
|---|---|---|---|
| BILLNOTC | Billing Notice | ||
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
No accounting entries allowed for this event.
Advices
Nil
Accounting Entries
No accounting entries allowed for this event.
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| PENL1REC | PENL1_LIQD | Credit | |||
| CUSTOMER | PENL1_LIQD | Debit | |||
| CUSTOMER | PRINCIPAL_LIQD | Debit | |||
| ASSETGL | PRINCIPAL_LIQD | Credit | |||
| CUSTOMER | PRINCIPAL_LIQD | Debit | |||
| ASSETGL | PRINCIPAL_LIQD | Credit | |||
| CUSTOMER | <Profit_Component>_LIQD | Debit | |||
| Interest_componentREC | <Profit_Component>_LIQD | Credit | |||
| ROLL_WASH | PRINCIPAL_ROLL | Debit | |||
| ASSETGL | PRINCIPAL_ROLL | Credit | |||
| ROLL_WASH | <Profit_Component>_ROLL | Debit | |||
| Interest_componentREC | <Profit_Component>_ROLL | Credit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MM_ROLL_ADV | Rollover Advice | ||
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
The preferences set for this product are as follows:
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| CHARGEXP | CHARG | Debit | |||
| CUSTOMER | CHARG | Credit | |||
| FWDLIABGL | PRINCIPAL_FWD | Credit | |||
| FWDLIABOFF | PRINCIPAL_FWD | Debit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MMBRKCON | Broker Confirmation | ||
| MM_DEAL_SLIP | Deal Slip | ||
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 | ||
| PAYMENT_MESSAGE | Payment Message | ||
| MMCONDEP | MM Borrowing Confirmation |
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| FRTAX1_PAY | FRTAX1_AMT | Credit | |||
| CUSTOMER | FRTAX1_AMT | Debit | |||
| CUSTOMER | FRTAXS_AMT | Debit | |||
| FRTAXS_PAY | FRTAXS_AMT | Credit | |||
| INTERPIA | INTER_LIQD | Debit | |||
| CUSTOMER | INTER_LIQD | Credit | |||
| LIABGL | PRINCIPAL | Credit | |||
| CUSTOMER | PRINCIPAL | Debit | |||
| FWDLIABGL | PRINCIPAL_FWD | Debit | |||
| FWDLIABOFF | PRINCIPAL_FWD | Credit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MM_CONT_ADV | Contract Advice |
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| INTEREXP | INTER_ACCR | Debit | |||
| INTERPIA | INTER_ACCR | Credit | |||
| PENL1EXP | PENL1_ACCR | Debit | |||
| PENL1PAY | PENL1_ACCR | Credit |
Advices
No advices allowed for this event.
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| LIABGL | PRINCIPAL_LIQD | Debit | |||
| CUSTOMER | PRINCIPAL_LIQD | Credit | |||
| CUSTOMER | INTER_LIQD | Credit | |||
| INTPIA | INTER_LIQD | Debit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 | ||
| PAYMENT_MESSAGE | Payment Message | ||
| LIQDNOTC | Liquidation Notice |
Accounting Entries
Nil
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MMAMDADV | Amendment Advice |
Accounting Entries
Nil
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
Nil
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
No accounting entries allowed for this event.
Advices
| Advice Name | Description | ||
|---|---|---|---|
| BILLNOTC | Billing Notice | ||
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
No accounting entries allowed for this event.
Advices
Nil
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| CUSTOMER | INTER_LIQD | Credit | |||
| INTERPIA | INTER_LIQD | Debit | |||
| LIABGL | PRINCIPAL_LIQD | Debit | |||
| CUSTOMER | PRINCIPAL_LIQD | Credit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 | ||
| MM_ROLL_ADV | Rollover Advice |
The preferences set for this product are as follows:
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| FWDASSETGL | PRINCIPAL_FWD | Debit | |||
| FWDASSETOFF | PRINCIPAL_FWD | Credit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MMCONPLA | MM Placement Confirmation | ||
| MM_DEAL_SLIP | Deal Slip | ||
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| ASSETGL | PRINCIPAL | Debit | |||
| CUSTOMER | PRINCIPAL | Credit | |||
| FWDASSETGL | PRINCIPAL_FWD | Credit | |||
| FWDASSETOFF | PRINCIPAL_FWD | Debit | |||
| FWDASSETGL | PRINCIPAL_FWD | Debit | |||
| FWDASSETOFF | PRINCIPAL_FWD | Credit | |||
| ASSETGL | PRINCIPAL_ROIN | Debit | |||
| ROLL_WASH | PRINCIPAL_ROIN | Credit | |||
| ASSETGL | PRINCIPAL_ADDL | Debit | |||
| CUSTOMER | PRINCIPAL_ADDL | Credit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MM_CONT_ADV | Contract Advice |
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| INTERINC | INTER_ACCR | Credit | |||
| INTERREC | INTER_ACCR | Debit | |||
| PENL1INC | PENL1_ACCR | Credit | |||
| PENL1REC | PENL1_ACCR | Debit | |||
| PENL2INC | PENL2_ACCR | Credit | |||
| PENL2REC | PENL2_ACCR | Debit |
Advices
No advices allowed for this event.
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| CUSTOMER | INTER_LIQD | Debit | |||
| INTERREC | INTER_LIQD | Credit | |||
| PENL1REC | PENL1_LIQD | Credit | |||
| CUSTOMER | PENL1_LIQD | Debit | |||
| CUSTOMER | PENL2_LIQD | Debit | |||
| PENL2REC | PENL2_LIQD | Credit | |||
| ASSETGL | PRINCIPAL_LIQD | Credit | |||
| CUSTOMER | PRINCIPAL_LIQD | Debit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 | ||
| PAYMENT_MESSAGE | Payment Message |
Accounting Entries
Nil
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MMAMDADV | Amendment Advice |
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| ASSETGL | PRINCIPAL_INCR | Debit | |||
| CUSTOMER | PRINCIPAL_INCR | Credit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
Nil
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
No accounting entries allowed for this event.
Advices
| Advice Name | Description | ||
|---|---|---|---|
| BILLNOTC | Billing Notice | ||
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
No accounting entries allowed for this event.
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
No accounting entries allowed for this event.
Advices
Nil
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| CUSTOMER | INTER_LIQD | Debit | |||
| INTER_REC | INTER_LIQD | Credit | |||
| ASSET GL | INTER_ROLL | Debit | |||
| INTER_REC | INTER_ROLL | Credit | |||
| ASSETGL | PRINCIPAL_LIQD | Credit | |||
| CUSTOMER | PRINCIPAL_LIQD | Debit | |||
| CUSTOMER | PRINCIPAL_LIQD | Debit | |||
| ASSETGL | PRINCIPAL_LIQD | Credit | |||
| CUSTOMER | <Profit_Component>_LIQD | Debit | |||
| Interest_componentREC | <Profit_Component>_LIQD | Credit | |||
| ROLL_WASH | PRINCIPAL_ROLL | Debit | |||
| ASSETGL | PRINCIPAL_ROLL | Credit | |||
| ROLL_WASH | <Profit_Component>_ROLL | Debit | |||
| Interest_componentREC | <Profit_Component>_ROLL | Credit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| LD_ROLL_ADV | Rollover Advice |
The preferences set for this product are as follows:
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| FWDLIABGL | PRINCIPAL_FWD | Credit | |||
| FWDLIABOFF | PRINCIPAL_FWD | Debit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MMBRKCON | Broker Confirmation | ||
| MMCONDEP | MM Borrowing Confirmation | ||
| MM_DEAL_SLIP | Deal Slip | ||
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 | ||
| PAYMENT_MESSAGE | Payment Message |
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| FRTAXC_EXP | FRTAXC_AMT | Debit | |||
| FRTAXC_PAY | FRTAXC_AMT | Credit | |||
| LIABGL | PRINCIPAL | Credit | |||
| CUSTOMER | PRINCIPAL | Debit | |||
| FWDLIABGL | PRINCIPAL_FWD | Debit | |||
| FWDLIABOFF | PRINCIPAL_FWD | Credit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MM_CONT_ADV | Contract Advice |
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| INTEREXP | INTER_ACCR | Debit | |||
| INTERPAY | INTER_ACCR | Credit |
Advices
No advices allowed for this event.
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| INTERPAY | INTER_LIQD | Debit | |||
| CUSTOMER | INTER_LIQD | Credit | |||
| CUSTOMER | PRINCIPAL_LIQD | Credit | |||
| LIABGL | PRINCIPAL_LIQD | Debit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 | ||
| PAYMENT_MESSAGE | Payment Message |
Accounting Entries
Nil
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MMAMDADV | Amendment Advice |
Accounting Entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| LIABGL | PRINCIPAL_INCR | Credit | |||
| CUSTOMER | PRINCIPAL_INCR | Debit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
Nil
Advices
| Advice Name | Description | ||
|---|---|---|---|
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
No accounting entries allowed for this event.
Advices
| Advice Name | Description | ||
|---|---|---|---|
| BILLNOTC | Billing Notice | ||
| SWIFT_MESSAGE | MT320, MT330, MT335, MT350 |
Accounting Entries
No accounting entries allowed for this event.
Advices
Nil
Accounting entries
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| CUSTOMER | INTER_LIQD | Credit | |||
| INTER_PAY | INTER_LIQD | Debit | |||
| ASSET GL | INTER_ROLL | Credit | |||
| INTER_PAY | INTER_ROLL | Debit | |||
| ASSET GL | PRINCIPAL_LIQD | Debit | |||
| CUSTOMER | PRINCIPAL_LIQD | Credit |
Advices
| Advice Name | Description | ||
|---|---|---|---|
| LD_ROLL_ADV | Rollover advice |
You will need to maintain the following accounting entry set-up when an MMM contract is liquidated with previous year adjustment option.
During liquidation of a schedule/contract the unrealized accruals for the previous year are liquidated before liquidation of unrealized accruals for the current year.
For liquidating the profit components the system posts the following entries during Liquidation (LIQD) for a bearing contract:
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| ComponentREC | Component_LIQD | Credit | |||
| Customer | Component_LIQD | Debit | |||
| ComponentUNRL | Component_LIQD_PY | Debit | |||
| ComponentINC | Component_LIQD_PY | Credit | |||
| ComponentUNRL | Component_LIQD_CY | Debit | |||
| ComponentINC | Component_LIQD_CY | Credit |
If the profit has been collected in advance the following entries are passed:
| Accounting Role | Amount Tag | Dr./Cr. Indicator | |||
|---|---|---|---|---|---|
| ComponentUNRL | Component_LIQD_PY | Debit | |||
| ComponentINC | Component_LIQD_PY | Credit | |||
| ComponentUNRL | Component_LIQD_CY | Debit | |||
| ComponentINC | Component_LIQD_CY | Credit |
When the Amount Tag is of type component_LIQD_PY and the Accounting Role pertains to unrealized income/expense, the head for the accounting role will be replaced by the previous year adjustment GL, while passing accounting entries.
Note
In case a contract spans over multiple years, any event (Back dated Rate revision, Principal Change, back dated booking of contract, and so on) which causes the accrual balances of the previous year to be recomputed, the accrual entries will be posted to the current year unrealized income and expense GL only.
This movement of balance is applicable only for components that require accruals.
Accounting Entries
Nil
Advices
| Advice Name | Description | ||
|---|---|---|---|
| MM_OFFER | MT199 (for MM Borrow contracts) | ||
| MM_ACPT_OFFER | MT199 (for MM Placement contracts) |