Modeling Cash Flows for New Instruments

Access the Cash Flow Modeler from the PeopleSoft Funds Transfer Pricing application.

This section discusses how to:

Generate cash flows for new instruments.
Define detailed parameters.
View cash flows.
View financial measures.
View error messages.
Save modeling results.

Pages Used to Model Cash Flows for New Instruments

Page Name	Definition Name	Navigation	Usage
Model New Instruments	FI_MODEL_NEW_INSTR	select Financial Services Industries, then select Analysis and Processing, then select Cashflow Modeler, then select Model a New Instrument, then select Model New Instruments	Generate cash flows for instruments, products, or pools.
Detailed Parameters	FI_CF_DETAIL_PARAM	Click the Detailed Parameters link on the Model New Instruments page.	View, modify, and define detailed parameters.
Cashflows	FI_CF_R00	select Financial Services Industries, then select Analysis and Processing, then select Cashflow Modeler, then select Model a New Instrument, then select CashFlows	View cash flow modeling results (statistics and charts).
Financial Measures	FI_CFCALC_R00	select Financial Services Industries, then select Analysis and Processing, then select Cashflow Modeler, then select Model a New Instrument, then select Financial Measures	View financial measures resulting from cash flow modeling.
Financial Calculation Output	FI_CFE_R00	Click the Display Error Message link on the Cashflows page.	Displays financial calculation output when cash flow is generated online from the Cash Flow Modeler process. View error messages concerning missing data, and errors generated when running the cash flow process. The system automatically displays the Error Messages page if you attempt to run the Cash Flow Modeler with missing data or if the process fails. The system displays the set, message number, message text, and process instance for each processing error.
Notes	FI_CASHFLOW_NOTES	select Financial Services Industries, then select Analysis and Processing, then select Cashflow Modeler, then select Model a New Instrument, then select Notes	Enter a description of the cash flow model.

Model New Instruments Page

Use the Model New Instruments page (FI_MODEL_NEW_INSTR) to generate cash flows for instruments, products, or pools.

Navigation

select Financial Services Industries, then select Analysis and Processing, then select Cashflow Modeler, then select Model a New Instrument, then select Model New Instruments

Image: Model New Instruments page

This example illustrates the fields and controls on the Model New Instruments page. You can find definitions for the fields and controls later on this page.

Run Cashflow

Click to run the cash flow process after defining the parameters.

Business, Model, Scenario

Business Unit

Select a predefined business unit from your business environment.

Scenario ID

Select a scenario ID from the predefined values. When you enter the scenario ID, the system displays default values for the Scenario Type, FIN Model, andInterest Rate fields.

Note: On the Historic Business Rules page select (Support Modules, then select Scenarios, then select Historic Business Rules) a model ID is associated with the specified scenario ID. Before you process cash flows, make sure that theTrace Settings field on the Model Definition page is set to a moderate value for that model ID. ATrace Settings field value of8-Complete could compromise performance capability significantly while processing cash flows.

FIN Model

After you select a scenario ID, the system displays the financial model.

See Setting Up Model Definitions.

Interest Rate

After you select a scenario ID, the system displays the Interest Rate type. The possible values areMarket, Deterministic, orStochastic.

Create From:

ScratchExisting Instrument, Existing Product, andExisting Pool

Select Scratchif you are modeling a new instrument.

If you are not modeling a new instrument, select one of the other options to use a template as a starting point.

Product, Instrument, Pool

Instrument Type

Select Bond/Note, Cap/Floor, Deposit, LOC, Loan, orSwap Leg.

Instrument ID, Product ID, andPool ID

Select an Instrument ID,Product ID, orPool ID.

The selection that you make depends on the Instrument Type selection.

Template Type

This field is available if you are using a loan template. Select 15FX Loan, 20FX Loan, 30FX Loan, 40FX Loan,orFL Loan.

Parameters Defined

The system selects the Parameters Defined check box to indicate that all the parameters required to run the cash flow are defined. Define the parameters on the Detailed Parameters page if this option is not selected.

Upgrade Cashflow Type

Select to save this cash flow as a user-defined cash flow. Otherwise, the system saves the cash flow as a new instrument cash flow.

Note: You also need to click the Save button at the bottom of the page to save the cash flow results.

Detailed Parameters

Click to access the Detailed Parameters page. Enter or modify the instrument, product, or pool details.

Detailed Parameters Page

Use the Detailed Parameters page ( FI_CF_DETAIL_PARAM ) to view or modify parameters.

Navigation

Click the Detailed Parameters link on the User Defined Cashflows page.

Image: Detailed Parameters page (1 of 2)

This example illustrates the fields and controls on the Detailed Parameters page (1 of 2). You can find definitions for the fields and controls later on this page.

Image: Detailed Parameters page (2 of 2)

This example illustrates the fields and controls on the Detailed Parameters page (2 of 2). You can find definitions for the fields and controls later on this page.

You define the fields on the Detailed Parameters page by using the Product Portfolio Definition product, under the Product Setup and Behavioral Models pages. If you use an existing instrument, product, or pool template for your cash flow model, the system populates most of these fields, but you can modify many of the fields. If you are creating a new cash flow model, you need to provide much of the information on the Detailed Parameters page; however, the system automatically populates some of the fields, which you can modify as needed.

Depending on whether you are modeling cash flows for an instrument, product, or pool, the following are required fields:

Disc Rate Tbl (discount rate table)
Start Date
First Rep Date (first reprice date)
Reprice Freq (reprice frequency)
Init Balance (initial balance)
Installments
Amortizing
Interest Rate
Index ID

Viewing Cash Flows

The system displays four tabs depending on the instrument, product, or pool that you are modeling.

Cashflow Data Tab

Use the Cashflows page (FI_CF_R00) to view the cash flow modeling results (statistics and charts).

Navigation

select Financial Services Industries, then select Analysis and Processing, then select Cashflow Modeler, then select User Defined Cashflow, then select Cashflows

Image: Cashflows page: Cashflow Data tab

This example illustrates the fields and controls on the Cashflows page: Cashflow Data tab. You can find definitions for the fields and controls later on this page.

The cash flow results appear on the Cashflows page, and include balance, principal, and interest amounts. Click the Balance button to chart the balance amounts Click thePrincipal and Interest button to chart the principal and interest amounts.

See Understanding Financial Calculation Rules.

Earning Output Tab

If the instrument, product, or pool that you are modeling uses a Forecast Scenario type, then the system displays the Earning Output page, which includes income, fees, and amounts associated with gains or losses.

Click the Balance button to view the charted balance amounts. Click thePrincipal and Interest button to view the charted principal and interest amounts.

Behavioral Output Tabs

If the instrument, product, or pool that you are modeling uses a Behavioral Model, then the system displays the deposit behavioral output page or the loan or line of credit behavioral output page.

Click Balance to chart the balance amounts. Click thePrincipal and Interest button to chart the principal and interest amounts.

See Setting Up Behavioral Models.

Financial Measures Page

Use the Financial Measures page (FI_CFCALC_R00) to view financial measures resulting from cash flow modeling.

Navigation

select Financial Services Industries, then select Analysis and Processing, then select Cashflow Modeler, then select Model a New Instrument, then select Financial Measures

Image: Financial Measures page

This example illustrates the fields and controls on the Financial Measures page. You can find definitions for the fields and controls later on this page.

After you run the Cash Flow Modeler, the system displays the resulting financial measurements for the modeled instrument, product, or pool.

See Understanding Financial Calculation Rules.

Financial Calculation Output Page

Use the Financial Calculation Output page (FI_CFE_R00) to displays financial calculation output when cash flow is generated online from the Cash Flow Modeler process.

View error messages concerning missing data, and errors generated when running the cash flow process.The system automatically displays the Error Messages page if you attempt to run the Cash Flow Modeler with missing data or if the process fails. The system displays the set, message number, message text, and process instance for each processing error.

Navigation

Click the Display Error Message link on the Cashflows page.

The system displays the Error Messages page if you attempt to run the Cash Flow Modeler with missing data or if the process fails. The system displays the set, message number, message text, and process instance for each processing error.

Saving Modeling Results

To save the modeling results, click the Save button on the Model New Instruments page. The system saves the Model New Instruments page data in the FI_CF_DEFN table, the Detailed Parameters page data in the FI_CF_INSTR_SEQ table, the cash flow data in the FI_CF_R00 table, and the Financial Measures page data in the FI_CFCALC_R00 table.