The profit and charges batch function processes liquidation’s and accruals for the day. This process should be executed after the end of transaction input has been marked for the day, for your branch.
For those accounts marked for auto liquidation and accrual, the End of Day process
This chapter contains the following sections:
When you mark the end of transaction input for the day, the IP Maintenance Consistency Check reports any inconsistencies in the data that you have maintained. The IP Maintenance Consistency Check reports the following inconsistencies in data:
This section contains the following topics:
You will recall that you can liquidate profit for accounts:
If you opt to liquidate profit automatically, you must specify the liquidation date and frequency for the product at the ‘Profit Preferences’ level which you apply on the account(s). On the scheduled liquidation date, profit will automatically be liquidated by the IP End of Day process (IPEOD) for the accounts.
If the profit liquidation day falls on a holiday, profit for those accounts that are to be liquidated on the holiday will be liquidated by the End of Day process that is run on the last working day before the holiday. However, processing for a holiday will be done on the next working day will be done on the subsequent working day if the holiday falls in the next financial cycle.
An ad-hoc liquidation can be carried out any time on an account, even if it has been defined for automatic liquidation. An ad-hoc liquidation of profit on an account defined for auto liquidation will liquidate profit till the date that you have specified. The subsequent automatic liquidation of the account will be for the remaining days in the liquidation period.
Profit Statements will be generated for applicable accounts. A profit statement, which should be generated, is specified for the profit liquidation event (PLIQ).
The Rate Change Advice will be generated when you mark the end of financial input for the day. This advice will be generated for all those accounts that had a UDE change event in any of the UDE rate values in the products linked to them.
While building a formula for the rule to which you have linked the product, if you indicated that the result of the formula is profit that should be accrued, the profit amount for all the accounts linked to the product will be accrued.
When defining the preferences for the product, if you specified the accrual frequency, profit will be accrued, by the End of Day process, according to the frequency you have specified.
Accruals will also be performed whenever there is profit liquidation. For an account on which a liquidation is done out of turn, an ad-hoc liquidation when a periodic liquidation is not due, accrual entries will be passed till the date of liquidation.
Entries will be passed to the accrual accounts that you specified while creating the product, that you have applied on the account. If you specified that accrual entries have to be passed for a product rather than for individual accounts, then a consolidated entry will be passed for the product. If not, an entry will be passed for each account on which you have applied the product.
Note
An ad-hoc liquidation of profit on an account, defined for auto liquidation, will liquidate profit till the date that you have specified. The subsequent accrual of profit will be from the date of ad hoc liquidation.
The details of accruals for each account will be available in the Accrual Control Journal, a report generated whenever accruals are performed as part of End of Day processing.
End of Day Processing for Tax/Non Tax IP Products
If IP product is maintained as a Tax product or non-tax product, then the EOD processing occurs in the following manner:
The system applies the existing formula for calculation of the credit profit for all accounts of the Non –Tax products. All Non Tax products are processed first. The system calculates, accrues, and liquidates these accounts and then subsequently processes the Tax products.
You need to maintain the formula for Tax products in the given format:
The TDS amount is deducted from the customer account and the relevant accounting entries will be posted for all Tax products. However, no accounting entries are posted for Non Tax products.
For the Event IACR (Profit Accrual), no accounting entries are posted for Tax products. The following accounting entries for the TDS amount will be passed when the PLIQ event is triggered:
Some changes in IP maintenance may necessitate the reversal of accrual entries already passed. These reversal entries are passed by the IP Daily functions. Some of the situations that require a reversal of accruals are:
Charges applied for maintenance and amendment of Creditor Direct Debit (DD) agreement in the Payments and Collections module are tracked and computed by the IP End of Day process, and applied to the relevant accounts. The following charge bases are used to compute such charges:
All of these charge bases are only tracked if the ‘Charge Applicable’ option has been enabled in the respective DD Agreement maintenances.
For details regarding the maintenance and servicing of DD agreements, refer the Payments and Collections module user manual.
When the liquidation event (CLIQ) is triggered for charge products linked to consolidated charge products, charges are computed depending upon the rule associated, but the corresponding entries are not posted. Similarly, for account classes linked to consolidated charge products, charges are computed during liquidation (CLIQ) but are not posted.
A consolidated entry comprising the charge entries for all linked charge products, for all account classes using the consolidated charge product, is posted when the liquidation is executed in respect of the consolidated charge product, after applying the applicable discounting and the range (minimum / maximum) validations.
IPEOD (Islamic Profits End of the Day) batch is configured in branch to handle profit computation of Islamic accounts. IPEOD branch is controlled operationally. This batch can be configured at Mandatory Batch Program Maintenance level as part of;