This chapter contains the following section:
Important terms used in this manual have been listed here.
Beginning of Day
This is the automatic processes initiated in the system at the beginning of each business day, as part of the AEOD. The system date change is executed and the change authorized, and the system is in readiness to accept transaction input for the day.
End of Cycle
This is the stage of Automated End of Day (AEOD) processing wherein automatic functions that are marked EOC, after the End of Financial Input (EOFI) and before the EOD (End of Day) process, will be executed.
End of Day
This is the last stage of AEOD processing in the system at the end of each business day, which indicates that all activities are complete for the business day. Any further activities in the system can only begin after the Beginning of Day stage, when the system date is changed to the next working day.
Basis Amount To
This is the higher limit of the slab or tier to which a charge is to be applied, either as a fixed rate or flat amount.
Charge Rule
The nature of application of a charge can be defined uniquely as a charge rule.
Customer Category
This is a group of customers with logically similar features or attributes.
Event
This represents each of the different stages in the processing life-cycle of a contract.
Floating Interest
In a contract, the interest that is applicable based on prevailing market rates, unlike a fixed rate, which is fixed at the time of initiation of the contract. The interest could be applied each time the prevailing market rate changes or periodically. A spread could be applied on a floating interest rate.
Grace Days to Penalty
In case of repayment made by the drawee after the repayment date, the grace period is the number of days after the repayment date for which no penal interest is charged.
ICCF Rule
A rule that identifies the manner in which appropriate charges and fees, as well as interest components and commissions, can be applied on a transaction in a product in FLEXCUBE.
Main Interest
When more than one interest component is applicable on a contract involving a product, one of the components may be designated as the main interest component for the contract. It helps identify and differentiate the different interest components applicable for the component.
Interest Method
This is the method to be used for the calculation of interest in transactions. .
Product
This is an identifier, in Oracle FLEXCUBE, for any type of service that a bank offers its customers. A set of attributes and preferences are maintained for the product, which will apply to the processing of any contracts, transactions or deals involving the product (service).
Rule Type
This indicates the basic nature of an ICCF (interest, commission, charge or fee) rule.
Tenor Basis
This is the basis upon which a charge or interest rule is defined, if applied based on the tenor of a contract.
Transaction Codes
Unique identifiers can be maintained in Oracle FLEXCUBE for different types of cash transfers (transactions) within the branch. A transaction code is also an identifier for each accounting entry that describes the nature (i.e., debit or credit) of the entry.
Brokerage Rule
This is a rule that identifies the calculation of a specific brokerage component applicable on a contract.
Brokerage Booking Method
This is the manner in which the brokerage payable to a broker must be booked. It could be either at the time of initiation of the contract (in advance) or at liquidation of the contract, as arrears.
GL
This is the module that forms the single repository in Oracle FLEXCUBE for financial information and accounting for all types of accounts held by the bank. Balances, turnovers and so on for any account or type of account can be maintained and consolidated.
LCY
This is a local currency in which profit and loss entries can be posted to a GL. Reporting will obtain details in this currency.
FCY
This is a foreign currency in which record of the profit and loss entries posted to a GL can be maintained.
Chart of Accounts
This is the structure or framework in which the different GLs are maintained, in the bank.
Rate Code
This is an identifier for a floating interest rate maintained for a specific currency and account type, in the Rates Maintenance.
Slab Structure
This is the pattern in which interest can be applied on a balance type account. In this pattern, interest is calculated according to the rate applied for the slab in which the entire amount falls.
Tier Structure
This is the pattern in which interest can be applied on a balance type account. In this pattern, the entire amount is split into tiers, and interest is calculated according to the rate applied for each tier.
User Data Element
This is the component that is used to build an interest rule for the application of interest on a balance type account in Oracle FLEXCUBE. Unlike a system data element, a user data element is not updated in the database by the system, but is specified by the user, and can take different values as specified. An example of a user data element would be the rate at which interest must be calculated.
Import LC
This is the incoming Letter of Credit that involves an applicant who is a customer of the processing bank.
Export LC
This is the outgoing Letter of Credit that involves the beneficiary who is a customer of the processing bank.
Guarantees
Guarantee is a form of comfort, issued by the bank to its client, in cases where the bank is not very comfortable with the credit rating of the customer. Unlike a letter of credit, in which the bank has to pay on maturity, the amount is payable only on invocation of guarantee by the creditor.
Amount Tag
This is the amount entry that is passed into a general ledger / sub ledger in the chart of accounts for each transaction.
Commission Calculation Type
This is the basis upon which commission applicable on a letter of credit is to be computed. It can be computed on a periodic or non-periodic basis.
Commission Collection Type
This is the manner in which commission applicable on a letter of credit can be collected. Commission could be collected either in advance or as arrears.
Commission Collection
This is the collection of commission applicable on a letter of credit. Commission may be collected by the issuing bank or the advising bank, for an LC, or against amendments to an LC.
Commission Calculation
This is the computation of commission applicable on a letter of credit.
Accrual Entries Level
The level at which commission accrual entries for letters of credit must be passed, by the automatic commission accrual process. Two levels are possible – product-level, indicating that a single entry for all the LCs for which commission was accrued automatically will be passed; or contract level, wherein accrual entries will be passed for each of the LCs for which commission was accrued.
Schedule Type
The kind of repayment schedule defined for a MM contract. It could be amortized, normal or capitalized.
Schedule Frequency
The frequency at which the repayment of the MM amount will be amortized in equated installments over the tenor of the contract.
Accrual Frequency
This is the frequency at which components of a contract such as interest, charges or commissions must be accrued over the tenor of the contract.
Tenor
This is the default period during which a contract is effective. The default Maturity Date of a contract is calculated from tenor.
Pre-Payment
Repayment of principal (whole or part) of a MM contract before the repayment schedule falls due. Prepayment involves a re-computation of subsequent interest schedule amounts.
Interest Application Method
This is the basis upon which interest on a contract is applied. Interest on a contract could be applied as an amount, or a fixed rate, or floating rate.
Interest Collection Method
This is the manner in which the main interest payable on a MM contract is collected or liquidated. The methods could be Bearing, Discounted or True Discounted.
ICCF
(Interest, Commission, Charge and Fee) The different charges and fees (including commissions and brokerage) and the interest components that are applicable on a contract are set up from the same ICCF Rule Details screen in Oracle FLEXCUBE.
ICCF Rule
An ICCF Rule identifies the calculation of a specific charge, fee, interest, commission or brokerage component applicable on a contract.
Interest Class
A specific type of interest component in Oracle FLEXCUBE, with specifically defined attributes, that could be applied on a contract.
MM - Money Market
This is the market for issuing and trading of short-term investment instruments, typically debt instruments such as bills, commercial paper, etc.
Securities
General term used to refer to all tradable instruments such as equities, bonds, zero coupon bonds, warrants, rights, etc.
Securities Deal
This is the transaction in which a security is bought/sold.
Coupon
This is the annual rate of interest payable to the holder of a bond, on the face value of the bond. The coupon also refers to the certificate representing the bond, which is proof of the interest due on it.
Cascade Amount
The commission will be calculated on the amended amount of an LC/BG, if Cascade Amount is chosen in the Commission Rule.
Rounding Period
If you indicate the rounding period as 0, the commission will be calculated for the actual number of days of the LC Contract. Otherwise, the commission will be rounded up to the nearest rounding period.
Rate Period
The rate period is used to define the period for which, the fixed commission rate is applicable. Instead of expressing the commission rate on a per annum basis, you should specify it on a rate period basis, which is expressed in months.
Brokerage Discount Maintenance
A stockbroker who carries out buy-and-sell orders, at a reduced commission compared to a full-service broker, but provides no investment advice is called as a Discount Broker.