14. Annexure A – Accounting Entries and Advices

This section contains details of the suggested accounting entries that can be set up, for the Islamic Financing module of Oracle FLEXCUBE. The details of the suggested accounting entries are given event-wise.

This chapter contains the following sections:

• Section 14.1, "Events "
• Section 14.2, "Accounting Roles"
• Section 14.3, "Event-wise Advices"

14.1 Events

The following is an exhaustive list of events that can take place during the lifecycle of an Islamic Financing contract. In the subsequent paragraphs we shall examine the accounting entries and advices for each of the events listed below.

	Event Code		Event Description
	ACCR		Accrual
	ADCH		ADHOC charge application
	ALIQ		Auto liquidation
	ARVN		Automatic Rate Revision
	BADJ		Back Dated Adjustment
	BNTC		Billing Notice Event
	BOOK		Booking Of Contract
	CLOS		Closure for off balance sheet comp
	DNTC		Delinquency Notice Event
	DSBR		Disbursement
	INIT		Contract Initiation
	ISTM		Profit Statement Event
	LCYP		LCY update processing
	LIQB		Liquidation Tanking
	LSTM		Finance Statement Event
	MLIQ		Manual Liquidation
	NOVA		Novation
	PROV		Provisioning
	READ		Readjustment Processing
	REOP		Reopen of finance account
	REVC		Reversal Of Contract
	REVD		Reversal Of Disbursement
	REVN		Rate Revision
	REVP		Reversal Of Payment
	RNOG		Re-Negotiation
	ROLB		Roll Over Booking
	ROLL		Roll Over Of Contract
	SROL		Special Roll over
	STSH		Installment Status Change
	TAXC		Specific Tax Calculation
	UDCN		UDE Cascade Change
	USGR		Un-Secured GL Transfer Reversal
	USGT		Unsecured GL Transfer
	VAMB		Value Dated Amendment Booking
	VAMI		Value Dated Amendment Initiation
	YACR		Yield to Maturity based Discount Accrual
	UIDB		Unearned Profit Booking
	PACR		Principal Accrual
	CONF		Sale Confirmation
	INSR		Insurance Renewal
	VPRV		Vendor Payment Reversal
	VPAY		Vendor Payment
	TRFR		Transfer
	TADJ		Transfer Adjustment

14.2 Accounting Roles

In this section we have provided a list of sample accounting roles.

	Accounting Role		Description
	ASSETGL		The Customer GL to which the Finance Account movements are reported.
	PRINCIPAL_LIQD		Principal Liquidated
	PRINCIPAL_INCR		Principal Increased
	COMPONENT _INC		Component Income
	COMPONENT EXP		Component Expense
	COMPONENT RIA		Component Received in Advance
	COMPONENT PAY		Component Payable
	COMPONENT REC		Component Receivable
	COMPONENT PIA		Component Paid in Advance
	BRIDGE GL		Intersystem Bridge GL
	SETTLEMENT ACCOUNT		Customer Account Settled From / To
	FEES_REC		Fees Receivable
	CHARGES_REC		Adhoc Charges Receivable
	PURCHASE ASSET		Purchase Asset GL
	COMPONENT_UID		Component Unearned Profit Booking
	DEFPRINCIPAL		Deferred Rental (Principal) Account
	PRINCIPALINC		Income from Ijarah (Principal)
	DealerWIPACC		Dealer work in progress in account
	WAKALA_ASSETGL		Real Asset for Wakala account
	WAKALA_SUSPGL		Suspense GL for Wakala-Murabaha
	INSURANCE_ACC		Insurance Company account
	INSURANCE_REC		Account Receivable – Insurance collection
	ASSET_FINANCING		Istisna Asset financing

Accounting roles for the YACR event

	Accounting Role		Acquisition Type		Role Type
	EIMDISCRIA		Discount		Asset
	EIMDISCINC		Discount		Asset
	EIMPREMPIA		Premium		Asset
	EIMPREMEXP		Premium		Asset
	EIMINTADJREC		Par		Asset
	EIMINTADJINC		Par		Asset

14.3 Event-wise Advices

In this section we will discuss the suggested events and advices that should be generated for that particular event in the life cycle of Islamic Financing.

This section contains the following topics:

• Section 14.3.1, "BOOK "
• Section 14.3.2, "INIT"
• Section 14.3.3, "UIDB"
• Section 14.3.4, "DSBR"
• Section 14.3.5, "ACCR"
• Section 14.3.6, "ADCH"
• Section 14.3.7, "ALI and MLIQ"
• Section 14.3.8, "STCH"
• Section 14.3.9, "VAMB and VAMI"
• Section 14.3.10, "ROLL"
• Section 14.3.11, "SROL – Special Roll-over"
• Section 14.3.12, "RNOG – Re-negotiation"
• Section 14.3.13, "NOVA – Novation"
• Section 14.3.14, "REVC – Finance Reversal"
• Section 14.3.15, "REVP - Payment Reversal"
• Section 14.3.16, "REVN – Periodic Rate Revision "
• Section 14.3.17, "ARVN – Automatic Rate Revision "
• Section 14.3.18, "UDCH – User Defined Element Value Changes"
• Section 14.3.19, "YACR – Yield to Maturity Discount Accrual"
• Section 14.3.20, "CLIQ – Charge Liquidation"
• Section 14.3.21, "PACR – Principal Accrual"
• Section 14.3.22, "INSR – Insurance Renewal"
• Section 14.3.23, "TRFR Event"
• Section 14.3.24, "TADJ Event"
• Section 14.3.25, "AUTH Event"

14.3.1 BOOK

The system uses this event to enter details of a finance account. However, at this stage the account is not initialized thus there will not be a change in the balance but you can perform other activities (processing fee etc) for the finance account. The accounting entries passed will be either Contingent Entries for disbursement or component liquidations entries.

	Advice Name		Description		Format Name
	CL_­CONT_ADV		Contract Advice		CL_CON­TR_STMT

You can maintain the following accounting entries for Murabaha product along with the other entries.

	Accounting Role		Amount Tag		Dr /Cr
	PURCHASE ASSET		PRINCIPAL		Dr
	CR_SETTLE­MENT_BRIDGE		PRINCIPAL		Cr

The following accounting entries for ‘Amount Financed’ and ‘Down Payment’ are passed for this event:

For Financial Lease without Asset Booking

	Accounting Role		Amount Tag		Dr /Cr
	PURCHASE_ASSET		PRINCIPAL		Dr
	PURCHASE ASSET		PRINCIPAL_DOWNP­MNT		Dr
	CR_SETTL_BRIDGE (Dealer A/c)		PRINCIPAL		Cr
	CR_SETTL_BRIDGE (Dealer A/c)		PRINCIPAL_DOWNP­MNT		Cr

 

The following accounting entries are passed for this event for Islamic Financing product:

For Financial Lease with Asset Booking

	Accounting Role		Amount Tag		Dr /Cr
	PURCHASE_ASSET		PRINCIPAL		Dr
	PURCHASE ASSET		PRINCIPAL_DOWNP­MNT		Dr
	CR_SETTL_BRIDGE		PRINCIPAL		Cr
	CR_SETTL_BRIDGE (Dealer A/c)		PRINCIPAL_DOWNP­MNT		Cr

 

The following accounting entries are passed for this event for the down payment:

	Accounting Role		Amount Tag		Dr /Cr
	PURCHASE_ASSET		PRINCIPAL		Dr
	VENDORPAYABLEGL		PRINCIPAL		Cr
	PURCHASE_ASSET		PRINCIPAL_DOWNP­MNT		Dr
	VENDORPAYABLEGL		PRINCIPAL_DOWNP­MNT		Cr

The following accounting entries are maintained for Istisna UIDB product component for this event:

	Accounting Role		Amount Tag		Dr /Cr
	ASSET_FINANCING		PRINCIPAL		Dr
	VENDORPAYABLEGL		PRINCIPAL		Cr

14.3.2 INIT

The system uses this event to initiate a finance with a value date as the date of initiation. However, you can not disburse the finance under this event.

	Advice Name		Description		Format Name
	CL_INIT_ADV		Initiation Advice		CL_INIT_ADV
	CL_CAP		Capitalization Advice		CL_CAP_ADV
	CL_CONT_ADV		Contract Advice		CL_CONTR_STMT
	CLST_SUM­MARY		Finance Summary Statement Advice		CL_LOAN_SUMMARY
	COUPON		Coupon Advice		ADV_COUPON

The following accounting entries are passed for this event:

For Operational Lease

	Accounting Role		Amount Tag		Dr /Cr
	INT_INC		PRINCIPAL_DOWNP­MNT		Cr
	DR_SET­TL_BRIDGE		PRINCIPAL_DOWNP­MNT		Dr

 

The following accounting entries are maintained for Istisna UIDB product component for this event:

	Accounting Role		Amount Tag		Dr /Cr
	LOAN_ACCOUNT		PRINCIPAL		Dr
	ASSET_FINANC­ING		PRINCIPAL		Cr

14.3.3 UIDB

The system uses this event whenever there is a change in principal or in rate revision. This event is triggered along with INIT, DSBR, VAMI, REVN, ROLL and MLIQ events.

	Accounting Role		Amount Tag		Dr /Cr
	ASSET		PRINCIPAL		Dr
	PURCHASE ASSET		PRINCIPAL		Cr

For unearned profit booking, the entries passed are:

	Accounting Role		Amount Tag		Dr /Cr
	COMPONENT_REC		COMPONENT_UINT		Dr
	COMPONENT_UID		COMPONENT_UINT		Cr

The following accounting entries are passed for this event for Islamic Financing product:

For Financial Lease with Asset Booking

	Accounting Role		Amount Tag		Dr /Cr
	COMPONENT_REC		COMPONENT_UINT		Dr
	COMPONENT_UID		COMPONENT _UINT		Cr

 

For Rebate Amount Calculation

	Accounting Role		Amount Tag		Dr /Cr
	COMPONENT_REC		COMPONENT_UINT		Dr
	COMPONENT_UID		COMPONENT_UINT		Cr

 

The following accounting entries are maintained for Istisna UIDB product component for this event:

	Accounting Role		Amount Tag		Dr /Cr
	PROFIT_REC		PROFIT_UINT		Dr
	PROFIT_UID		PROFIT_UINT		Cr

14.3.4 DSBR

This event is marked by the disbursement of the finance amount. The disbursement may be done manually or can be triggered by a disbursement schedule. The finance account will have debit balances after total disbursement.

	Advice Name		Description		Format Name
	CR_ADV		Credit Advice		CL_CR_ADV
	CLST_DE­TAILS		Finance Detailed Statement Advice		CL_LOAN_DETAIL
	CLST_SUM­MARY		Finance Summary Statement Advice		CL_LOAN_SUMMARY
	TAX_ADVICE		Tax Advice		CL_TAX_ADVICE

The entries passed are:

	Accounting Role		Amount Tag		Dr /Cr
	LOAN_AC		PRINCIPAL		Dr
	CR_SETTLE­MENT_BRG		PRINCIPAL		Cr

You can maintain the following accounting entries for Murabaha product along with the other entries.

	Accounting Role		Amount Tag		Dr /Cr
	ASSET		PRINCIPAL		Dr
	PURCHASE ASSET		PRINCIPAL		Cr

The following accounting entries for ‘Amount Financed’ and ‘Down Payment’ are passed for this event:

For Financial Lease without Asset Booking

	Accounting Role		Amount Tag		Dr /Cr
	LOAN_ACCOUNT		PRINCIPAL		Dr
	PURCHASE ASSET		PRINCIPAL		Cr
	PURCHASE ASSET		PRINCIPAL_DOWNPMNT		Cr
	DR_SETTL_BRIDGE (Customer A/c)		PRINCIPAL_DOWNPMNT		Dr

 

The following accounting entries are passed for this event for Islamic Financing product:

For Financial Lease with Asset Booking

	Accounting Role		Amount Tag		Dr /Cr
	PURCHASE ASSET		PRINCIPAL		Cr
	DEALERWIPACC		PRINCIPAL		Dr
	PURCHASE ASSET		PRINCIPAL_DOWNP­MNT		Cr
	DR_SET­TL_BRIDGE		PRINCIPAL_DOWNP­MNT		Dr
	LOAN_ACCOUNT		PRINCIPAL		Dr
	DEFPRINCIPAL		PRINCIPAL		Cr

 

For Insurance Refund

	Accounting Role		Amount Tag		Dr /Cr
	DR_SET­TL_BRIDGE		COMPO­NENT_DP		Dr
	COMPONENT_PAY		COMPO­NENT_DP		Cr
	COMPONENTPAY		COMPO­NENT_DP		Dr
	CR_SET­TL_BRIDGE		COMPO­NENT_DP		Cr

Note

• The finance account of the customer reports to an internal GL of the bank, determined by the Role to Head mapping done at the product level.
• A settlement bridge account is used since there is a probability of the customer ac­count being present in another system which is capable of interfacing with Oracle FLEXCUBE. During the reconciliation process, the appropriate customer account in the relevant system is credited with the finance amount.

The following accounting entries are passed for DSBR event for the down payment:

	Accounting Role		Amount Tag		Dr /Cr
	DPRCVDGL		PRINCIPAL_DOWNPMNT		Dr
	PURCHASE_ASSET		PRINCIPAL_DOWNPMNT		Cr
	LOAN_ACCOUNT		PRINCIPAL		Dr
	PURCHASE_ASSET		PRINCIPAL		Cr

The following accounting entries are passed for this event for the product with Insurance Required:

	Accounting Role		Amount Tag		Dr /Cr
	DR_SETTL_BRIDGE		COMPONENT_DP		Dr
	COMPONENTPAY		COMPONENT_DP		Cr
	COMPONENTPAY		COMPONENT_DP		Dr
	CR_SETTL_BRIDGE		COMPONENT_DP		Cr

The following accounting entries can be set up for the DSBR event in insurance renewal processing:

	Accounting Role		Amount Tag		Dr /Cr		Netting
	DR_SETTL_BRIDGE		COMPONENT_DP		Dr		No
	COMPONENTPAY		COMPONENT_DP		Cr		Yes
	COMPONENTPAY		COMPONENT_DP		Dr		Yes
	CR_SETTL_BRIDGE		COMPONENT_DP		Cr		No
	CR_SETTL_BRIDGE		COMPONENT_PREMIUM		Dr		No
	INSURANCE_ACC		COMPONENT_PREMIUM		Cr		No

The following accounting entries are maintained for Istisna UIDB product for this event:

	Accounting Role		Amount Tag		Dr /Cr
	VENDORPAYABLEGL		PRINCIPAL		Dr
	CR_SETTL_BRIDGE		PRINCIPAL		Cr

14.3.5 ACCR

The accrual of the various components will be triggered based on the accrual parameters you maintain at the product level.

The following accounting entries are passed for this event:

For Profit Accrual

	Accounting Role		Amount Tag		Dr /Cr
	INT_REC		INT_ACCR		Dr
	INT_INC		INT_ACCR		Cr

For Compensation Profit Accrual

	Accounting Role		Amount Tag		Dr /Cr
	PENAL_INT_REC		PENAL_INT_ACCR		Dr
	PENAL_INT_INC		PENAL_INT_ACCR		Cr

 

For unearned profit booking

	Accounting Role		Amount Tag		Dr /Cr
	COMPONENT_UID		COMPONENT_ACCR		Dr
	COMPONENT_INC		COMPONENT_ACCR		Cr

 

For Financial Lease without Asset Booking

	Accounting Role		Amount Tag		Dr /Cr
	COMPONENT RECEIVA­BLE		INT_ACCR		Dr
	INCOME		INT_ACCR		Cr

For Operational Lease

	Accounting Role		Amount Tag		Dr /Cr
	COMPONENT RECEIVA­BLE		COMPONENT _LIQD		Dr
	INT_INC		COMPONENT _LIQD		Cr

The following accounting entries are passed for this event for Islamic Financing product:

 

For Financial Lease with Asset Booking

	Accounting Role		Amount Tag		Dr /Cr
	COMPONENT UID		COMPO­NENT_ACCR		Dr
	COMPONENT INC		COMPO­NENT_ACCR		Cr

 

For Rebate Amount Calculation

	Accounting Role		Amount Tag		Dr /Cr
	COMPO­NENT_UID		COMPO­NENT_ACCR		Dr
	COMPO­NENT_INC		COMPO­NENT_ACCR		Cr

 

The following accounting entries are maintained for Istisna UIDB product component for this event:

	Accounting Role		Amount Tag		Dr /Cr
	CompnameEXP		Compna­me_ACCR		Dr
	CompnamePAY		Compna­me_ACCR		Cr

14.3.6 ADCH

The following accounting entries are passed for this event for Islamic Financing product to process the insurance refund component:

	Accounting Role		Amount Tag		Dr /Cr
	DR_SET­TL_BRIDGE		COMPO­NENT_ADCH		Dr
	COMPONENT_PAY		COMPO­NENT_ADCH		Cr
	COMPONENT_PAY		COMPO­NENT_ADCH		Dr
	CR_SET­TL_BRIDGE		COMPO­NENT_ADCH		Cr

 

14.3.7 ALI and MLIQ

Depending on the mode of liquidation opted for, whether automatic or manual, the appropriate event is triggered. A batch process will be triggered at EOD for payments that are marked for auto liquidation.

ALIQ

	Advice Name		Description		Format Name
	DR_ADV		Debit Advice		CL_DR_ADV
	DELIN­QYADV		Delinquency Advice		CL_DELQ_ADV

 

MLIQ

	Advice Name		Description		Format Name
	BILNOTC		Billing Advice		CL_­BILL_ADVC
	DELINQYADV		Delinquency Advice		CL_DELQ_ADV
	PAYMENT_ADVICE		Payment Advice		CL_PMT_ADV

The accounting entries for these events will be as follows:

Principal Repayment

	Accounting Role		Amount Tag		Dr /Cr
	DR_SETTLE­MENT_BRG		PRINCI­PAL_LIQD		Dr
	LOAN_AC		PRINCI­PAL_LIQD		Cr

 

Profit Repayment

	Accounting Role		Amount Tag		Dr /Cr
	DR_SETTLE­MENT_BRG		INT_LIQD		Dr
	INT_REC		INT_LIQD		Cr

 

Compensation Profit Repayment

	Accounting Role		Amount Tag		Dr /Cr
	DR_SETTLE­MENT_BRG		PENAL_INT_LIQD		Dr
	PENAL_INT_REC		PENAL_INT_LIQD		Cr

 

Prepayment Compensation

	Accounting Role		Amount Tag		Dr /Cr
	CUSTOMER		Compo­nent_LIQD		Dr
	componentINC		Compo­nent_LIQD		Cr

 

For Rebate Amount Calculation

	Accounting Role		Amount Tag		Dr /Cr
	CUSTOMER A/C (DR_­SETTL_BRIDGE)		COMPONENT_LIQD		Dr
	COMPONENT_REC		COMPONENT_LIQD		Cr
	COMPONENT_UID		COMPONENT_UINR		Dr
	COMPONENT_REC		COMPONENT_UINR		Cr

The accounting entries for these events with the residual amount liquidation will be as follows:

	Accounting Role		Amount Tag		Dr /Cr
	LOAN_ACCOUNT		PRINCI­PAL_RV		Cr
	DR_SETTL_BRIDGE		PRINCI­PAL_RV		Dr
	COMPONENT RECEIVA­BLE		INTEREST_RV		Cr
	DR_SETTL_BRIDGE		INTEREST_RV		Dr

The following accounting entries can be set up to process the product with Insurance requred:

	Accounting Role		Amount Tag		Dr /Cr
	DR_SET­TL_BRIDGE		COMPO­NENT_LIQD		Dr
	COMPONENTPAY		COMPO­NENT_LIQD		Cr
	COMPONENTPAY		COMPO­NENT_LIQD		Dr
	CR_SET­TL_BRIDGE		COMPO­NENT_LIQD		Cr

The following accounting entries can be set up for the MLIQ/ALIQ event to process insurance renewal:

	Accounting Role		Amount Tag		Dr /Cr		Netting
	DR_SET­TL_BRIDGE		COMPO­NENT_LIQD		Dr		No
	COMPONENTPAY		COMPO­NENT_LIQD		Cr		Yes
	COMPONENTPAY		COMPO­NENT_LIQD		Dr		Yes
	CR_SET­TL_BRIDGE		COMPO­NENT_LIQD		Cr		No
	CR_SET­TL_BRIDGE		COMPONENT_REC		Dr		No
	INSURANCE_REC		COMPONENT_REC		Cr		No

The following accounting entries are maintained for rebate component for this event:

	Accounting Role		Amount Tag		Dr /Cr
	CompnamePAY		Compname_LIQD		Dr
	CR_SETTL_BRIDGE		Compname_LIQD		Cr

14.3.8 STCH

This event is triggered when a status change occurs. It could be a Forward Status Change (FSTC) where the finance moves from one adverse status to another or a Backward Status Change (BSTC) wherein, on repayment of overdue installments, a reversal of status takes place. The status derivation rule is used to resolve the status. The change may occur due to a status rule being activated. If the number of days by which a component becomes overdue, exceeds the allowed number of days (may be referred to as the grace period), the component can undergo a status change if a status rule is defined with such a criteria. A status change is triggered if any condition defined for the rule is satisfied.

The accounting entries, if maintained for the events (FSTC and BSTC) will be triggered. The accounting role provided will be the same for all the changes. However, the Role to Head mapping rules will resolve the entries to the appropriate accounts for each status.

Profit accrual for status ‘ACTIVE’

	Accounting Role		Amount Tag		Dr /Cr
	INT_REC (Mapped to a Real Asset)		INT_ACCR		Dr
	INT_INC (Mapped to a Real Income GL)		INT_ACCR		Cr

 

Profit accrual for status ‘PAST DUE’

	Accounting Role		Amount Tag		Dr /Cr
	INT_REC (Mapped to a Contingent Asset)		INT_ACCR		Dr
	INT_INC (Mapped to a Contingent Liability)		INT_ACCR		Cr

 

14.3.9 VAMB and VAMI

These statuses are triggered because of making amendments to a finance account.

VAMB (Booking of a Value Dated Amendment)

This event is triggered when you book a value dated amendment.

You can book for an amendment of the following:

• Maturity date
• Principal Increase
• Rate change

The batch program will identify the changes booked and the same is triggered appropriately on the value date by the VAMI event.

	Advice Name		Description		Format Name
	CLAMDADV		Amendment Advice		CL_AM­D_ADV

 

VAMI (Initiation of a Value Dated Amendment)

This event will pick up the future dated VAMBs and on the value date, initiate the same.

The accounting entries for an increase in principal will be as follows:

	Accounting Role		Amount Tag		Dr /Cr
	LOAN_AC		PRINCIPAL_IN­CREASED		Dr
	CR_SETTLE­MENT_BRG		PRINCIPAL_IN­CREASED		Cr

Any change to Rate and Tenor (Maturity Date) will alter the original finance schedules.

The following accounting entries are passed for this event:

For Financial Lease without Asset Booking

	Accounting Role		Amount Tag		Dr /Cr
	LOAN_ACCOUNT		PRINCI­PAL_INCR		Dr
	CR_SET­TL_BRIDGE		PRINCI­PAL_INCR		Cr

 

14.3.10 ROLL

This event is triggered when a finance is renewed with new terms. Rollover will have either a combination of liquidation and rollover of Principal. It can also have liquidation of Profit and compensation Profit.

	Advice Name		Description		Format Name
	CLAMDADV		Amendment Advice		CL_AMD_ADV
	CL_ROLL_ADV		Rollover Advice		CL_ROLL_ADV
	PAYMENT_ADVICE		Payment Advice		CL_PMT_ADV

The entries passed for rollover of the Principal are as follows:

	Accounting Role		Amount Tag		Dr /Cr
	CR_SETTLEMENT_BRG		PRINCIPAL_ROLL		Cr
	LOAN_AC		PRINCIPAL_ROLL		Dr

For liquidation of Principal, the following entries are passed:

	Accounting Role		Amount Tag		Dr /Cr
	DR_SETTLEMENT_BRG		PRINCIPAL_LIQD		Dr
	LOAN_AC		PRINCIPAL_LIQD		Cr

For liquidation of Profit and Compensation Profit, the entries are:

	Accounting Role		Amount Tag		Dr /Cr
	DR_SETTLEMENT_BRG		LIQD_AMT		Dr
	INT_REC		INT_LIQD		Cr
	PENAL_INT_REC		PENAL_INT_LIQD		Cr

You may encounter the following cases:

Case 1: Rollover only Principal Outstanding; Pay Profit & Compensation Outstanding

In this case, both ‘PRINCIPAL_LIQD’ and ‘PRINCIPAL_ROLL’ will be zero and hence the ‘LOAN_ACCOUNT’ balance is not affected.

The Outstanding Profit and Principal will be liquidated. Referring to the accounting entries above,

• INT_LIQD = Profit Outstanding
• PENAL_INT_LIQD = Compensation Profit Outstanding
• LIQD_AMT = INT_LIQD + PENAL_INT_LIQD (If Netting is ‘ON’ and both have the same Settlement Account).

Case 2: Rollover Principal + Profit Outstanding; Pay Compensation Outstanding

In this case,

• PRINCIPAL_LIQD = 0,
• PRINCIPAL_ROLL = INT_ROLL (which is the Profit Rolled over as Principal);
• PENAL_INT_LIQD = Compensation Profit Outstanding
• LIQD_AMT = PENAL_INT_LIQD (If Netting is on and both have the same Settlement Account).

Case 3: Rollover Principal + Profit + Compensation Outstanding

PRINCIPAL_ROLL = INT_ROLL + PENAL_INT_ROLL

LIQD_AMT = 0

Case 4 - a: Rollover Special Amount, Amount > Principal Outstanding

This is in effect a disbursement. Therefore,

PRINCIPAL_ROLL = SPECIAL_AMOUNT – PRINCIPAL_OUTSTANDING

Since the rolled over amount is greater than the outstanding principal, it will be positive and hence an increase in the finance amount is registered.

Case 4 – b: Rollover Special Amount, Amount < Principal Outstanding

This results in a decrease in Principal and hence

PRINCIPAL_ROLL = SPECIAL_AMOUNT – PRINCIPAL_OUTSTANDING will lead to a negative amount which will reduce the Dr Balance on the Finance Account.

14.3.11 SROL – Special Roll-over

This event is triggered when a roll-over is done and it involves a change in the currency, product and customer.

	Advice Name		Description		Format Name
	CLAMDADV		Amendment Advice		CL_AMD_ADV
	CL_ROLL_ADV		Roll-over Advice		CL_ROLL_ADV

14.3.12 RNOG – Re-negotiation

This event is triggered when a customer is not being able to honor the terms and conditions of the credit. In such a situation, the client re-negotiates the terms and conditions of the credit before maturity date.

	Advice Name		Description		Format Name
	CLAMDADV		Amendment Advice		CL_AMD_ADV
	PAYMENT_ADVICE		Payment Advice		CL_PMT_ADV

14.3.13 NOVA – Novation

This event is triggered when a primary customer is changed.

	Advice Name		Description		Format Name
	CLAMDADV		Amendment Advice		CL_AM­D_ADV

14.3.14 REVC – Finance Reversal

This event is triggered when a finance is withdrawn. This will pass the DSBR entries with a reversal of signs (-ve) for the amounts, as follows:

	Accounting Role		Amount Tag		Dr /Cr
	LOAN_AC		- PRINCIPAL		Dr
	CR_SETTLE­MENT_BRG		- PRINCIPAL		Cr

14.3.15 REVP - Payment Reversal

The latest payment made, both auto and manual, will be reversed during this event. This will pass the ALIQ or MLIQ event selected with a reversal of signs for the amounts.

Reversal of Principal Repayment

	Accounting Role		Amount Tag		Dr /Cr
	DR_SETTLE­MENT_BRG		- PRINCI­PAL_LIQD		Dr
	LOAN_AC		- PRINCI­PAL_LIQD		Cr

 

Reversal of Profit Repayment

	Accounting Role		Amount Tag		Dr /Cr
	DR_SETTLE­MENT_BRG		- INT_LIQD		Dr
	INT_REC		- INT_LIQD		Cr

 

Reversal of Compensation Profit Repayment

	Accounting Role		Amount Tag		Dr /Cr
	DR_SETTLE­MENT_BRG		- PENAL_INT_LIQD		Dr
	PENAL_INT_REC		- PENAL_INT_LIQD		Cr

 

14.3.16 REVN – Periodic Rate Revision

This will change the Floating Profit Rates based on the periodicity that you maintain.

	Advice Name		Description		Format Name
	CL_INT_STMT		Profit Statement Advice		CL_INT_STMT
	RATECH_ADV		Rate Change Advice		CL_RTCH_ADV

14.3.17 ARVN – Automatic Rate Revision

This will change the Floating Rate as and when the rate changes.

	Advice Name		Description		Format Name
	CL_INT_STMT		Profit Statement Advice		CL_INT_STMT
	RATECH_ADV		Rate Change Advice		CL_RTCH_ADV

14.3.18 UDCH – User Defined Element Value Changes

This event will be triggered whenever there is a change in the UDE values. This will be required to have Rate revision advices sent to the customers.

14.3.19 YACR – Yield to Maturity Discount Accrual

This event will be triggered for the computation of IRR. The following accounting entries will be passed:

	Accounting Role		Amount Tag		Dr /Cr
	EIMDISCRIA		EIM_ACCR		Dr
	EIMDISCINC		EIM_ACCR		Cr
	EIMPREMEXP		EIM_ACCR		Dr
	EIMPREMPIA		EIM_ACCR		Cr

If refunding needs to be done as part of with complete pre-payment, the following entries should be passed in addition to the ones specified above:

	Accounting Role		Amount Tag		Dr /Cr
	<Charge Comp>_RIA		EIM_ADJ		Dr
	CR_SETTL_BRIDGE		EIM_ADJ		Cr
	DR_SETTL_BRIDGE		EIM_ADJ		Dr
	<Charge Comp>_PIA		EIM_ADJ		Cr

14.3.20 CLIQ – Charge Liquidation

This event triggers the liquidation of charges applicable to the finance accounts. You need to set up the following entries for this event:

	Accounting Role		Amount Tag		Dr /Cr
	DR_SETTL_BRIDGE		<Charge Comp>_LIQD		Dr
	<Charge Comp>_RIA		<Charge Comp>_LIQD		Cr
	CR_SETTL_BRIDGE		<Charge Comp>_LIQD		Dr
	<Charge Comp>_PIA		<Charge Comp>_LIQD		Cr

14.3.21 PACR – Principal Accrual

This event realizes the principal payment in different accounts. You need to set up the following entries for this event:

	Accounting Role		Amount Tag		Dr /Cr
	DEFPRINCIPAL		PRINCIPAL_PACR		Dr
	PRINCIPALINC		PRINCIPAL_PACR		Cr

14.3.22 INSR – Insurance Renewal

This event triggers renewal of insurance. You need to set up the following entries for this event:

	Accounting Role		Amount Tag		Dr /Cr
	INSURANCE_REC		COMPONENT_REC		Dr
	CR_SETTL_BRIDGE		COMPONENT_REC		Cr
	CR_SETTL_BRIDGE		COMPONENT_PREMIUM		Dr
	INSURANCE_ACC		COMPONENT_PREMIUM		Cr

14.3.23 TRFR Event

The accounting entries for transferring principal outstanding Profit accrued and overdue (if any)  to the new branch is:

	Accounting Role		Amount Tag		Dr /Cr
	LOAN_ASSET_GL		PRINCIPAL_OUTSTAND_TRFR_OBRN		Cr
	PROFIT_REC		PROFIT_OUTSTAND_TRFR_OBRN		Cr
	LOAN_ASSET_GL		PRINCIPAL_OUTSTAND_TRFR_NBRN		Dr
	PROFIT_REC		PROFIT_OUTSTAND_TRFR_NBRN		Dr

For CI with Unearned Profit, the unearned profit GL can be transferred with entries:

	Accounting Role		Amount Tag		Dr /Cr
	PROFIT_UID		PROFIT_UINT_TRFR_OBRN		Dr
	PROFIT_UID		PROFIT_UINT_TRFR_NBRN		Cr

To transfer the receivable GL for products with UIDB event defined the following entries need to be maintained:

	Accounting Role		Amount Tag		Dr /Cr
	PROFIT_REC		PROFIT_UREC_TRFR_OBRN		Cr
	PROFIT_REC		PROFIT_UREC_TRFR_NBRN		Dr

For vendor Payment, the vendor payable GL is transferred during the TRFR event.

	Accounting Role		Amount Tag		Dr /Cr
	VENDOR_PAYABLE_GL		PRINCIPAL_VPAY_TRN_OBRN		Dr
	VENDOR_PAYABLE_GL		PRINCIPAL_VPAY_TRN_NBRN		Cr

Purchase Asset

The balance in purchase asset has to be transferred during the transfer event. Hence the accounting entries maintained fro TRFR is as follows:

	Accounting Role		Amount Tag		Dr /Cr
	PUR_ASSET_GL		PURCHASE_ASSET_TRFR_OBRN		Cr
	PUR_ASSET_GL		PURCHASE_ASSET_TRFR_NBRN		Dr

Down Payment

The balance in down payment receivable has to be transferred during the transfer of event. Hence the accounting entries maintained for TRFR is:

	Accounting Role		Amount Tag		Dr /Cr
	DPRCVDGL		DOWNPAY_REC_TRFR_OBRN		Cr
	DPRCVDGL		DOWNPAY_REC_TRFR_OBRN		Dr

A transfer advice attached with event TRFR displays the account number, old and new branches, transfer date, the finance outstanding as on transfer date and the schedule details. The advice specifies whether the transfer is done as part of branch merger, product transfer or customer initiated transfer.

	Advice Name		Description		Format Name
	CI_TRFR_ADV		Transfer Advice		CI_TRFR_ADV

14.3.24 TADJ Event

The event adjusts the income in the old branch in case of reversal of pre-transfer events and for back-dated events beyond the transfer date. You need to set up the following entries for the event:

	Account Role		Amount Tag		Dr/Cr
	PROFIT_INC		PROFIT_ADJINC_TADJ_OBRN		Dr
	PROFIT _INC		PROFIT_ADJINC_TADJ_NBRN		Cr

14.3.25 AUTH Event

The event is sent when any asset is processed to be taken over and authorized.

	Advice Name		Description
	CL_TKOVER		Take Over Advice