Integration with Enterprise Performance Management Warehouses
PeopleSoft Financial Services Industry analytic applications (PeopleSoft Risk-Weighted Capital and PeopleSoft Funds Transfer Pricing) draw data from the Enterprise Performance Management (EPM) Warehouse for their processing and post results back to the EPM Warehouse tables for reporting. After loading the data from a source system, the EPM Warehouse validates, enriches, stores, and moves the data for multidimensional reporting and analysis.
This section discusses:
Performance ledger, products, and instruments.
Performance ledger versus average daily balance ledger.
Instrument table population.
Performance Ledger, Products, and Instruments
The analytic applications can process data at either a summary level, using performance (PF) ledger data, or at a detail level, using instrument or treasury position data. The primary table for PF ledger balances is PF_LEDGER_ F00, containing data that originates from the general ledger. PF ledger balances are typically current, end-of-period balances, that are used for management profitability reporting, as opposed to GAAP reporting. You can think of the relationship between the PF ledger, product definitions, and instrument balances, as a type of hierarchy. The PF ledger is the highest level in the tree hierarchy. Many of the PF ledger accounts consist of application balances that roll up to the balance sheet accounts in the PF Ledger table, and the products are made up of individual instrument balances.
Use the financial product definition pages to define the characteristics and processing rules used by the financial analytic applications for all of the instruments you define. The product definitions specify the types of financial products that the institution sells or carries in its portfolio, for example, mortgages, auto loans, and foreign exchange contracts. The instruments are the specific financial obligations, contracts, and accounts. A product or application defines the attributes of a generic instrument, specifically its behavior in terms of cash flow. An instrument is a specific instance of a product. The instrument records are the institution's specific individual financial obligations, and one of the key defining attributes on the instrument record is its product ID. In terms of the bank's balance sheet, the product or instrument can be an asset (loans, lines of credit), or a liability (checking accounts, certificates of deposit), or an off-balance sheet item (derivative contracts, foreign exchange contracts).
In some cases, it makes sense to define analytic application rules and process them at the PF ledger account level. Several types of balance sheet accounts are not application-specific, for example, fixed assets, cash, accounts receivable, and accounts payable. However, these account balances can still represent a significant source or use of funds and should have an internal funding credit or charge allocated to them. For most product specific balances, analyze and report at the product or instrument detail, where individual attributes (such as credit risk), or cash flow characteristics (such as loan prepayments) require individual treatment.
To minimize processing time and enhance efficiency, instruments can be aggregated into instrument pools by the Stratification application engine, using criteria and stratification rules that you define. The instrument pool is viewed and treated like a synthetic instrument and can be used by the cash flow generator as a proxy for all of the instruments that were aggregated into the instrument pool.
PF Ledger Versus Average Daily Balance Ledger
The PF Ledger table stores current end-of-period balances. The Average Daily Balance (ADB) Ledger table (PF_LED_ADB_F00) stores average daily balances. You may prefer to use average daily balances for such calculations as monthly funds transfer charges or risk-weighted capital allocations for accounts whose balances fluctuate throughout the month (for example, cash and credit cards). PeopleSoft Financial Services Industry analytic applications enable you to choose either PF ledger or ADB ledger type balances for your processing.
Note: PF ledger is the master table that stores all account balances, and it is the sole basis for selection of rows (balances) for processing. Once a balance sheet rule processes an account, it does not process it again. The reason for this is to prevent any possibility of double-counting a balance that may be included in more than one basis ID. Similarly, a balance sheet rule can process a ledger row as either an ADB or a PF ledger type of balance, but never both.
Instrument Table Population
You load the data warehouse tables with financial instrument details from the source systems. The instrument details are stored in the FI_INSTR_F00 table. Because a product defines a type of instrument in generic terms, the product definitions (or templates) may be used as default values for instrument details in the FI_INSTR_F00 table. This may be done in cases where the source data are not available or when the analysis at hand does not warrant the loading of individual instrument details. In such cases, generic product descriptions may be sufficient. If you use product templates to populate the FI_INSTR_F00 table, the following data must be provided at a minimum from the source system:
Initial and current balances of the instrument.
Start and end dates.
Current interest rate.
Note: If you want to do instrument level profitability reporting from the PF ledger, make sure that you use only 18 characters to uniquely identify each instrument ID. Use only 18 of the available 20 characters in FI_INSTRUMENT_ID. The reason is that when you run the PF_EDIT program prior to posting data to PF_LEDGER, it checks that each of these instrument IDs appears in the PF_OBJ_TBL, which can only handle field sizes up to 18 characters.