3. Setting up Fund Rules

This chapter contains the following sections:

3.1 Fund Rule

This section contains the following topics:

3.1.1 Setting up Fund Rules

In Oracle FLEXCUBE Investor Servicing, each fund that the AMC wishes to maintain can be entered into the system database.

Oracle FLEXCUBE Investor Servicing enables you to specify a set of logically grouped guidelines for each fund, which pertain to aspect of the method of operation of the fund. Each of these logically grouped sets of guidelines is distinct and unique, and is called a ‘fund rule’.

For each fund, you can maintain a complete set of such guidelines or ‘fund rules’. The options chosen by the AMC in specifying each of the rules will be directives to the system for the operation of the fund. Therefore, Oracle FLEXCUBE Investor Servicing processes each transaction in a fund according to the fund rules that you maintain for the fund.

Whenever you need to refer to any or all guidelines about the operation of a fund, you can refer to the fund rule records that you have maintained for the fund.

Some fund rules are mandatory and you must set them up before you authorize a fund, while others are optional, and you may be set up as and when required.

There are many different fund rules that may be defined for a fund and these may be enumerated as follows:

Fund Demographics

This is the entry point for setting up a fund in the system. The Fund name, Fund ID, the base currency for the fund, the country that the fund is based in and the effective date for the fund rules may be set here. You can also designate the Type and the Class that the fund comes under. You can specify the AMC that operates the fund.

This is a mandatory fund rule, and you must set it up before you authorize a fund.

Corporate Actions

In this section, you can specify the rules that will govern the pattern of processing corporate actions for the fund. This includes the income distribution by the fund to its unit holders. These rules include the Dividend Declaration and Payment frequencies, the Default Distribution Mode, Tax Deducted at Source (TDS) details, the lead times for the different dates such as the Book Closing, Freeze Holdings, and Dividend Payment dates.

Setting up this rule is optional, and you can set it up for a fund as and when required. It is recommended that you set it up before you authorize the fund.

For corporate actions such as dividend, you can set up individual, separate rules for processing cash dividend as well as stock dividends for the same fund.

General Operating Rules

In this section, you can designate the rules that will govern the operation of the fund. You can specify the frequency at which the fund price is declared. You can also designate a fund to have automatic redemption.

This is a mandatory fund rule, and you must set it up before you authorize a fund.

Shares Characteristics

These rules govern the features of shares that are issued in the fund. You can designate a fund as scrip-less fund or a scrip-based fund that issues certificates. The limits on the number of unit holders that must be allowed to subscribe to the fund and the ceiling on the capital that may be issued by the fund may also be specified in this rule. You can set up the standard lot, the maximum and minimum certificate denominations and the issue number range. You can also set up the limits for Foreign Investors in the fund, either as an amount or as a percentage of the issued share capital.

This is a mandatory fund rule, and you must set it up before you authorize a fund.

Transaction Processing Rules

These rules govern the parameters by which each transaction is processed in the fund, and these rules may be set up according to each transaction type. These parameters typically include the ranges of volumes allowed for each transaction type, the range of periods and times for the processing of a transaction, the processing policy for each transaction type and the base price definition types and factors. You may enable or disable a transaction type as the requirement may be.

This is a mandatory fund rule, and you must set it up before you authorize a fund.

Setting up the Amount/Units Limits for Investor Categories

The limits in the volume of investment for each category of investors can be setup using this fund rule. This is a sub-rule that you can maintain as part of the Transaction Processing Rules rule.

Setting up the Amount/Units Limits for Communication Modes

The limits in the volume of investment for each communication mode can be set up using this fund rule. This is a sub-rule that you can maintain as part of the Transaction Processing Rules rule.

Setting up the Amount/Units Limits for Investment and Standing Instructions

The limits in the volume of investment for initial investments and standing instructions can be set up using this fund rule. This is a sub-rule that you can maintain as part of the Transaction Processing Rules rule.

Fund Load Setup

These rules govern the ways in which an applicable fee or incentive will impact the processing of transactions in the fund.

Setting up this rule is optional, and you can set it up for a fund as and when required. It is recommended that you set it up before you authorize the fund.

Fund Formula Setup

This fund rule facilitates the specification of any expression that will be used in estimating the base prices or the Net Asset Value for any transaction type.

Setting up this rule is optional, and you can set it up for a fund as and when required. It is recommended that you set it up before you authorize the fund.

Fund Residency Restriction Setup

This fund rule enables the Fund Manager to make restrictions with respect to the nationality of the unit holders who subscribe to the fund.

This is a mandatory fund rule, and you must set it up before you authorize a fund.

Fund Sale Country Setup

If some funds are not to be opened for investment in specific countries, restrictions can be made in respect of that country, identifying that the fund cannot be sold in that country.

This is a mandatory fund rule, and you must set it up before you authorize a fund.

Fund Transaction Currencies Setup

The Fund Manager can also identify the currencies that the fund can transact in, and restrict the use of other currencies for transactions. Therefore, each Fund can have a set of identified currencies that may be used as transaction currencies, and other currencies may be disallowed for transactions.

This is a mandatory fund rule, and you must set it up before you authorize a fund.

Specific Fund Price Date Setup

You can use this fund rule to specify specific price dates to be operable at a specific frequency for certain transaction types, for a fund. Setting up the specific price date is an optional fund rule, and may be edited, authorized or amended just as the other fund rules.

Amount Limits for IRA Transactions

For funds that form part of the investment portfolio of retirement products that you offer to investors, and in which you have opted to allow investment into retirement accounts (IRA), you can define the limits for the different kinds of transactions into such accounts that would apply to the fund.

This is an optional rule, and must be maintained only in the event of IRA investment being allowed for the fund.

Additional Information Setup

You can also maintain additional information for a fund, if additional information heads have been maintained for the AMC, to be applicable for funds.

Though maintenance of additional information is not, strictly speaking, a fund rule, you can only maintain the information through the Fund Demographics screen, when you are setting up a fund, along with all the other fund rules.

3.1.2 Invoking Fund Rule Screen

You can set up the fund rules for a fund in the ‘Fund Rules Detail’ screen. You can invoke this screen by typing ‘UTDFNDRL’ in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button.

In this screen, you must set up the first fund rule, the Fund Demographics rule, before you can set up the other fund rules.

After you have maintained the Fund Demographics rule, click ‘Ok’ button.

Click on any of the links to invoke the corresponding setup screen for any of the other fund rules. For instance, to set up Corporate Actions for the fund, click on the Corporate Actions link. The name, and ID of the fund is defaulted in each of the fund rule setup screen, from the Fund Demographics record.

Choosing an Umbrella Fund

If you are maintaining fund rules for an umbrella fund in the Fund Demographics screen, select Yes in the Umbrella Fund drop-down list and click ‘Umb Fund’ option list which displays the hierarchy structure. The fund you select is displayed in the Umbrella Fund field. The Fund ID of the selected umbrella fund is populated in the Fund ID field of the main fund rule screen. The same steps must be followed in the Summary Fund Rule screen when you are trying to retrieve the record of an umbrella fund.

3.1.3 Maintaining Fund Demographics

This is the entry point for setting up a fund in the system. A rudimentary, demographic profile is captured for the fund that includes the following basic details, and lays down a basis for defining other important rules and details for the fund:

A fund will not be identified within the system unless it has a Fund Demographics profile record, and all other rules and details for the fund cannot be set up unless the fund has this profile.

To set up the Fund Demographics profile for a fund, use the Fund Demographics screen. You can invoke this screen by typing ‘UTDFNDRL’ in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button.

 

Note

Before you set up a Fund Demographics profile record, it is desirable to ensure that the following information is already setup in the system:

You can specify the following details in this screen:

Fund ID

Alphanumeric; 6 Characters; Mandatory

The Fund ID is a unique Identification for each Fund in the system. Enter a unique value for the fund for which a Fund Demographics record is being set up. If the record of an umbrella fund has been retrieved, the Fund ID is defaulted to the Family ID, and cannot be altered. If the record retrieved is that of a share class, then the unique six-character system generated ID appears and this cannot be altered.

Rule Effective Date

Date Format; Mandatory

Using the date picker, specify the date from when the Fund Demographics Rule that is currently being set up should become effective.

If the Existing Fund box is checked, the Rule Effective Date specified here must be earlier than the Application Date, and later than the Fund Start Date.

If the fund is not an existing fund, i.e., the Existing Fund box is not checked, and the fund is a new fund, the Fund Start Date and Rule Effective Date must be the same.

The Rule Effective Date should be later than (or same as) the Fund Start Date and it should also be later than (or same as) the current application date of the system.

Fund Start Date

Date Format; Mandatory

Using the date picker, specify the date upon which the fund is to begin operations (in case of a new Fund).

If the Existing Fund box is checked, the Fund Start Date specified must be earlier than the Application Date.

For new funds, the Fund Start Date specified is same as the Application Date.

Fund Name

Alphanumeric; 60 Characters; Mandatory

Enter the name of the fund for which the Fund Demographics profile is being set up in this record. If the record of an umbrella fund has been retrieved, the Fund Name is defaulted to the Family Description, and cannot be altered.

Fund Short Name

Alphanumeric; 15 Characters; Mandatory

Enter the short name of the fund for which the Fund Demographics profile is being set up in this record. If the record of an umbrella fund has been retrieved, the Fund Short Name is defaulted to the Family ID, and cannot be altered. If the record retrieved is that of a share class, then the Fund Short Name is defaulted to the name specified in the Sub-Fund Share Class Mapping.

Fiscal Year Start Date

Date Format; Mandatory

Enter the date from when the Fiscal Year should start for the fund. This will be the base date for arriving at any frequency defined in the system.

The Fiscal Start Date must be earlier than the application date and the Rule Effective Date of the fund.

Fiscal Year End Date

Date Format; Mandatory

This is the date on which the Fiscal Year should end for the fund when the Fiscal Start Date is specified; the system displays the Fiscal Year End Date exactly a year later than the Start Date.

The Fiscal End Date should be later than (or same as) the current date of the system. It should also be later than (or same as) the Rule Effective Date of the fund that is being set up.

Primary Registration Address

Alphanumeric; 255 Characters; Mandatory

If the registration address for the fund is different from the address of the AMC to which the fund belongs, you may specify the address in this field. By default, the address of the AMC is considered to be the primary registration address for the fund.

This address is necessary for reporting and information purposes only.

Fund Identification Number

Alphanumeric; 12 Characters; Optional

Specify the ISIN identification number (ISIN Code) assigned to the fund.

The ISIN Code is a 12-character alphanumeric code, with the first two digits being non-numeric, and the last two, strictly numeric. Along with the Fund ID, It is used for retrieval of the fund details in all search facilities in the system, and is captured during transaction entry as identification for the fund.

Fund Base Currency

Alphanumeric; 3 Characters; Mandatory

Specify the currency in which the fund will be denominated, from the drop down list provided. The NAV and dividend declarations for the fund will be in this base currency.

Fund Base Currency Description

Display

The system displays the description for the selected fund base currency.

Min Amt for Tax ID-Indv

Numeric, 18 Characters; Mandatory

Enter the minimum subscription/IPO subscription amount beyond which the system needs to validate the PAN of the unit holder.

While capturing a transaction, the system will check the transaction amount with the amount maintained here for unit holders of the type ‘Individual’. If a transaction exceeds the stated minimum amount, the system will throw up an error and not save the transaction.

Min Amt for Tax ID-Corp

Numeric, 18 Characters; Mandatory

Enter the minimum subscription/IPO subscription amount beyond which the system needs to validate the PAN of the corporate investor.

Existing Fund?

Optional

Choose ‘Yes’ from drop-down list to indicate that the fund for which the record is being set up here is an existing fund, i.e., the Rule Effective Date is earlier than the Application Date.

Fund Class

Mandatory

Select the class to which the Fund must belong, from the drop-down list. The list displays the following values:

AMC

Alphanumeric; 12 Characters; Mandatory

Specify the AMC that this Fund will be operative in. Alternatively, you can select AMC ID from the option list. The list displays all valid AMC ID maintained in the system.

AMC Description

Display

The system displays the description for the selected AMC.

Legal Entity

Alphanumeric; 12 Characters; Optional

Specify the legal entity details. The adjoining option list displays all valid entity ID maintained in the system. You can choose the appropriate one.

Legal Entity field option list will default value only If (While creating AMC) AMC Structure is marked to YES. If AMC is Fund Structure Applicable AMC then Legal Entity Filed is mandatory

Legal Entity Description

Display

The system displays the description for the selected legal entity ID.

Brokers Mandatory?

Mandatory

Select Yes from drop-down list to indicate that brokers are to be mandatory for the given Fund. If not, select ‘No’ in this field.

Fund Enabled?

Mandatory

This field may be used to enable or disable a fund. By default, when you are setting up a new fund, this field has a ‘Yes’ value, indicating that every new fund is created in the system initially as an enabled fund. You can select one of the options from the drop-down list. The list displays the following values:

Minimum Holding Period

Numeric; 22 Characters; Optional

Enter the lock in period for the investors investing in a Money Market Mutual Fund.

Fund Tax ID

Alphanumeric; 25 Characters; Optional

You can use this field to indicate the Tax ID assigned to the fund. It is used for reporting and information purposes. The Tax ID you specify here cannot be specified for any other fund in the system.

Fund Ticker Symbol

Alphanumeric; 25 Characters; Optional

Specify the ticker symbol that identifies the fund in the stock exchange list.

IRA Investments Allowed

Optional

You can use this field to indicate whether investment into the fund is allowed through an Individual Retirement Account (IRA). Select ‘Yes’ from drop-down list to indicate that IRA investments are allowed, into the fund. If so, you must maintain the limits for such investments by in the Fund IRA Transactions section in this screen.

Note

If you select ‘Yes’ option, it implies that the fund is a pension fund.

Fund Suspended?

Mandatory

You can use this field to suspend a fund for transactions of all types. Select ‘Yes’ from drop-down list to indicate that the fund is suspended for transactions. Transactions of all types (both those entered through the Transaction Detail screens as well as system-generated and uploaded transactions) into suspended funds are not allowed.

If a fund is suspended, transactions of all types are not allowed into the fund. If a fund is not suspended, transactions of specific types that have been suspended for the fund in the Transaction Processing Rules (if any) are not allowed.

Umbrella Fund?

Optional

To enter a Fund Demographics Profile for an umbrella fund, choose ‘Yes’ from the drop-down list. This will enable the Umbrella Fund Details.

Umb. Fund

Alphanumeric; 25 Characters; Optional

Specify the umbrella fund

Currency of Expression Fund

Display

The system displays the currency of expression fund based on the fund price currencies maintained.

If price currency maintained in Fund Price Currency tab then this field will be Yes else it will be No

Fund Type

Alphanumeric; 38 Characters; Mandatory

Specify the Fund Type from the option list. This list is populated with the Fund Types set up in the Fund Type Maintenance.

You can use this field to identify if the fund is equity fund or money market fund.

Fund Type Description

Display

The system displays the description for the selected fund type.

Fund Family

Alphanumeric; 6 Characters; Mandatory

Specify the fund family under which the fund must be placed from the option list that is populated with all fund families that are maintained in the system as part of the Fund Family Maintenance. If this record is being set up for an umbrella fund, then the ID of the Immediate Parent Family is displayed here from the Fund Family Maintenance, and this cannot be altered.

Fund Family Description

Display

The system displays the description for the selected fund family.

Fund Country

Alphanumeric; 3 Characters; Mandatory

Specify the country of domicile of the fund. This information is used to determine whether a unit holder that subscribes to the fund must be considered a Foreign unit holder or not.

Fund Country Description

Display

The system displays the description for the selected fund country.

Registrar

Alphanumeric; 12 Characters; Mandatory

Select the Registrar for the fund being set up, from the options provided.

Registrar Description

Display

The system displays the description for the selected registrar.

Trustee

Alphanumeric; 12 Characters; Mandatory

Select the Trustee for the fund being set up, from the options provided.

Trustee Description

Display

The system displays the description for the selected trustee.

Custodian

Alphanumeric; 12 Characters; Mandatory

Enter the custodian details.

Custodian Description

Display

The system displays the description for the selected custodian.

Hedge Fund

Optional

Select ‘Yes’ from the drop-down list to indicate that the selected fund is a hedge fund and select ‘No’ to indicate otherwise.

Relationship Termination Date

Display

The system displays the relationship termination date.

Fund Domicile

Display

The system defaults the fund domicile value as off-shore or on-shore while saving the fund based on the fund country and installed entity country.

3.1.4 Multi Language Details Button

Click ‘Multi Language Details’ tab to access the Multi Language Details screen.

 

The Fund Name and the language specified in the Fund Demographics screen are displayed. You can re-enter the fund name in the languages shown in the screen.

Details

Language Code

Alphanumeric; 12 Characters; Mandatory

Specify the language code.

Fund Name

Alphanumeric; 60 Characters; Optional

Specify the fund name.

Refer the chapter Maintaining Reference Information under Reference Information User Manual for information about Multiple language support.

3.1.5 Shares Characteristics Button

The Shares Characteristics fund rule enables you to maintain certificate details for the fund. Further, the fund corpus information, limits on the unit holders and the foreign investors and the account statement information are maintained here.

You can also maintain the rounding precision pattern for allocation of units in this screen.

To set up the Shares Characteristics rule for a fund, use the ‘Shares Characteristics’ screen. You can invoke this screen by clicking ‘Shares Characteristics’ tab from the ‘Fund Rules’ screen.

 

Note

Before you set up a Shares Characteristics profile record for a fund, it is desirable to en­sure that the fund already has an existing, unauthorized Fund Rules profile record.

You can specify the following details in this section:

Basic Information

Fund ID

Display

This field indicates the ID fund for which you are setting up the Shares Characteristics profile. This information is defaulted from the Fund Demographics screen.

Rule Effective Date

Display

The Rule Effective Date for the fund, which you specified in the Fund Demographics screen, is displayed here.

Scrip Based

Mandatory

Select the scrip based option from the drop-down list. The list displays the following values:

In this field, you can designate the applicability of certificate issue for investment in the fund. According to the option you select here, you can:

You can specify the details of certificate issue for the fund, in the Certificate Details tab in this screen.

Unit Par Value

Numeric; 17 Characters; Mandatory

Enter the Par Value for the fund. Normally, this will be the base price for Initial Public Offer (IPO) period. However, you can change the base price for IPO.

Rounding Option for Units

Mandatory

Select the rounding options for the value of the number of allotted units, designated for the fund from the drop-down list.The list displays the following values:.

Example

Let us suppose that the number of allotted units reckoned for a subscription transaction is 100.36497, and that this value must be rounded to the 3rd decimal place.

If you indicate rounding up, then the value reckoned would be 100.365.

If you indicate rounding off, then, applying normal rounding off rules, the value reckoned would be 100.365.

If you indicate rounding down or truncation, then the value would be truncated as it is, in the 3rd decimal place, and it would be reckoned as 100.364.

Min No of Unit Holders

Numeric; 22 Characters; Mandatory

Enter a value to specify the lower limit (i.e.) Minimum Number of unit holders beyond which the system will disable the fund and await action from the Fund Manager. At any point of time, when the fund is enabled, the number of unit holders cannot fall below this value. This value must not be lower than zero.

Min Registered Capital

Numeric; 30 Characters; Mandatory

Enter an amount to specify the lower limit of Fund Corpus beyond which the system will disable the fund and await action from the Fund Manager. At any point of time, when the fund is enabled, the fund corpus (registered capital) cannot go below this value.

Rounding Precision for Units

Numeric; 22 Characters; Mandatory

Specify the decimal value or negative value for the units and the units would be reckoned for rounding precision.

Max No of Unit Holders

Numeric; 22 Characters; Mandatory

Enter a value to specify the Upper limit (i.e.) Maximum Number of unit holders beyond which the system will disable the fund and await action from the fund Manager. At any point of time, when the fund is enabled, the number of unit holders cannot go above this value. This value must not be lower than or equal to zero.

Max Registered Capital

Numeric; 30 Characters; Mandatory

Enter an amount to specify the Upper limit of Fund Corpus beyond which the system will disable the fund and await action from the Fund Manager. At any point of time, when the Fund is enabled, the fund corpus (registered capital) cannot go above this value.

This upper limit must be below the figure of ten thousand trillion, at any point of time.

Certificate Required For Block

Optional

For scrip less funds, select ‘Yes’ from the drop-down list to indicate that certificates must be issued to investors for block transactions in the fund.

Maximum Registered Units

Numeric; 22 Characters; Optional

Enter a value to specify the maximum registered units for the fund. A transaction can be allocated only if it does not breach the maximum registered units specified here or at the investor category level. If breached, system will calculate the balance in the fund at the fund level as well at the investor category level, after considering the effect of the transaction to be allotted. If any of the limits are breached, the transaction will not be allocated and marked as error.

You can specify the limits at the fund-investor category level in the ‘Holding Limit for Investor Category’ screen. This screen is explained in detail further in the chapter.

Preferences

In this section, you can set up your preferences for the Foreign Investors limits and the frequency and lead times for Account Statements.

Account Statement Frequency

Mandatory

Select the frequency with which the system should initiate the Account Statement processing, from the drop-down list. The list displays the following values:

This is applicable only if Account Statement is required.

Print Account Statement?

Mandatory

Select ‘Yes’ from drop-down list to indicate that the Account Statement is to be printed for the fund that is being set up.

Account Statement Lead Time

Numeric; 22 Characters; Mandatory

Enter a lead-time in days. This lead-time is to prompt the Registrar that the processing of Account Statement should happen within this lead-time.

Print Holdings Statement?

Mandatory

Select ‘Yes’ from drop-down list to indicate that the Holdings Statement is to be printed for the fund that is being set up.

Foreign Investors Limit

Limit By

Mandatory

Choose ‘Amount’ from the drop-down list if the foreign investors limit is in terms of a flat Amount or choose ‘Percentage’ if the limit is to be defined in terms of percentage of Registered Capital.

Limit Value

Numeric; 12 Characters; Optional

Enter a value to specify the percentage of fund corpus that foreigners are allowed to hold. This could be either a percentage of Fund Corpus or a flat Amount. If it is a percentage, then it cannot be greater than 100.

If this is entered as a flat amount, then it should never exceed or be equal to the figure of one hundred trillion.

Limit Allowed?

Optional

Select ‘Yes’ from drop-down list to indicate the fund that is being set up is allows Foreign Investors to invest in the fund.

Certificate Details

For funds in which certificate generation is mandatory, or is at the option of the unit holder, you must specify the details of the certificate denominations as mandatory information in this section. Therefore, if you have chosen either the ‘Scrip Based’ option or the ‘Certificate Option’ in the Certificate Options field, then you must specify the certificate details as mandatory information in this tab.

If you have chosen the ‘Scrip Less’ option in the Certificate Options field, and have checked the Certificate Required for Block box, then this section is not applicable.

Standard Lot

Numeric; 22 Characters; Optional

Enter a value to specify the standard lot for fund. This is also the marketable lot.

Start Issue No.

Numeric; 22 Characters; Optional

Enter a value for this field. This is just for information. For a new Fund, the Certificate Numbers will start from this number.

Prefix DNR Code

Alphanumeric; 1 Character; Optional

Enter a character for this field. This will be used as prefix to the Distinctive Number Record (DNR) Number.

This information is only applicable if you have specified the number of decimals for units as zero, in the Number of Decimals for Units field in this screen.

Start DNR No

Alphanumeric; 1 Character; Optional

Enter a value for this field. This is just for information. For new funds, this will be same as last DNR issued number.

This information is only applicable if you have specified the number of decimals for units as zero, in the Number of Decimals for Units field in this screen.

Min Cert Denomination

Numeric; 22 Characters; Optional

Enter a value to specify the minimum certificate denomination, i.e., the next level of denomination after the standard lot. The system will use this after exhausting the maximum certificate denominations.

Prefix Code

Alphanumeric; 1 Character; Optional

Enter a character for this field. This will be used as prefix to the Certificate Number.

Prefix Certificate Code and Prefix Distinctive Number Record Code will reflect as per maintenance in the report.

Last Issued No.

Display

The system displays the last issued certificate number.

This is to specify that this was the last certificate number that has been issued so far and system needs to start from next number. For new funds, this could be zero. This is also equal to the Start Certificate Issue Number in the case of new Funds.

Last DNR No.

Display

The system displays the last Distinctive Number Record number.

This is to specify that this was the last DNR number that has been issued so far and system needs to start from next number. For new funds, this could be zero. This is also equal to the Start Certificate Issue Number in the case of new Funds.

This information is only applicable if you have specified the number of decimals for units as zero, in the Number of Decimals for Units field in this screen.

Max Cert Denomination

Numeric; 22 Characters; Optional

Enter a value to specify the maximum certificate denomination. This is the first level of denomination used by the system.

Note

Min. Cert Denomination is 100, Max. Cert Denomination is 1000 and a unit holder purchas­es 5500 units. The certificates will be issued for 5 of 1000 denomination and 5 of 100 de­nomination.

User Override Allowed

Mandatory

Select ‘Yes’ from drop-down list to indicate the user on the unit holder’s request can override the default denominations defined above. If this is enabled, system will allow the teller to override the fund default denominations. This is true only for minimum and maximum denominations. The Standard lot cannot be changed. This is applicable only to scrip-based funds.

3.1.5.1 Holding Limit for Investor Category Button

You can specify the limits in terms of units that can be allowed for any given investor category. You may either skip this maintenance or specify limits for one or more investor categories. Use the Holding Limit for Investor Category screen to specify the limits.

Click ‘Holding Limit for Investor Category’ button from the ‘Share Characteristics’ screen to invoke this screen.

Fund ID

Display

This field indicates the ID fund for which you are setting up the Shares Characteristics profile. This information is defaulted from the Fund Demographics screen.

Rule Effective Date

Display

The Rule Effective Date for the fund, which you specified in the Fund Demographics screen, is displayed here.

UH Category

Alphanumeric; 2 Characters; Mandatory

Enter one of the valid investor categories. During unitholder amendment the system will validate if the amendment breaches the limit set up at the investor category level. System will not allow the amendment if the limits are breached and displays an appropriate error message.

Maximum Registered Units

Numeric; 27 Characters; Mandatory

Specify the maximum registered units.

You can click add icon to add details on Investor Category. Similarly you can click delete icon to delete the details.

The allocation of the following transactions will be impacted:

System will check if any limit has been set for the maximum registered capital at the fund level as well as fund - investor category level. If yes, system will calculate the balance in the fund at the fund level as well as investor category level, after considering the effect of the transaction to be allotted. If any of the limit is breached the transaction will not be allocated and marked as error. This transaction will get picked up in the subsequent EODs and may or may not be allotted based on the holding on that day. The validation for the balances will always be made for the latest fund rule only, regardless of the transaction being backdated or current dated.

3.1.6 General Operating Rules Tab

This fund rule facilitates the maintenance of guidelines that will govern the operation of the fund with respect to the following parameters:

To set up the General Operating Rules for a fund, use the General Operating Rules screen. You can invoke this screen by clicking ‘General Operating Rules’ tab from the Fund Rules Detail screen.

 

Note

Before you set up a General Operating Rules profile record for a fund, it is desirable to en­sure that the fund already has an existing, unauthorized profile record.

You can specify the following details in this screen:

Fund ID

Display

This field indicates the ID fund for which you are setting up the General Operating Rules profile. This information is defaulted from the Fund Demographics screen.

Rule Effective Date

Display

The Rule Effective Date for the fund, which you specified in the Fund Demographics screen, is displayed here.

3.1.6.1 Basic Information Tab

Click ‘Basic Information’ tab in ‘General Operating Rules’ screen.

 

Post Priced?

Mandatory

Select ‘Yes’ from the drop-down list to indicate that the price for the fund will be announced Post Transactions.

Next Price Declare Date

Date Format; Mandatory

Specify the next date upon which the fund price is to be declared. This date must be after the Rule Effective Date of the fund, and the current system date.

Price Declare Frequency

Alphanumeric; 1 Character; Mandatory

Select a value to specify the frequency with which the price will be announced, from the options provided.

If you are specifying the General Operating Rules for a Post-priced Fund, you must specify this frequency as Daily

No of Decimals for NAV

Numeric; 22 Characters; Mandatory

Indicate the maximum number of decimals that would be reckoned for rounding precision, for the NAV.

Rounding Options for NAV

Mandatory

Select the rounding options for the value of the NAV for the selected transaction type, for the fund from the drop-down list. The list displays the following values:

Example

Let us suppose that the NAV for the fund on a certain date 02-03-2003 is 10.561234, and that this value must be rounded to the 3rd decimal place.

If you indicate rounding up, then the value reckoned would be 10.562.

If you indicate rounding off, then, applying normal rounding off rules, the value reckoned would be 10.561.

If you indicate rounding down or truncation, then the value would be truncated as it is, in the 3rd decimal place, and it would be reckoned as 10.561.

NAV Lot

Numeric; 6 Characters; Mandatory

Specify the NAV lot.

Money Market Fund?

Mandatory

Select ‘Yes’ from the drop-down list if the fund is for money market.

Multiple Price Basis?

Mandatory

You can use this field to indicate whether multiple price bases are allowed for the fund. Select one of the options from the drop-down list:

If you select this option, price bases other than the standard bases such as NAV and the Transaction Base Prices are also allowed for the fund.

Ageing Date

Mandatory

Select the ageing basis for the fund from the drop-down list. The list displays the following values:

Based on the ageing date specified here, ageing for period based loads are calculated.

By default, the ageing date is the transaction date. You are allowed to specify the ageing basis if you are creating a new fund. You cannot modify this value, post authorization of the fund.

Amount Block Allowed

Optional

Select ‘Yes’ from drop-down list to indicate that the amount block is allowed at the fund level.

Note

You will be allowed to enter details in the Amount Block Maintenance screen provided this box is checked for the fund. Moreover, the amount blocked will not be available for re­demption.

Block Priority Number

Numeric; 4 Characters; Optional

The funds are selected in the ascending order of the priority number .When blocking is done at UH/ CIF level across funds. During Unblock, funds will be selected in the reverse priority of Block.

This is field is not optional, if check box 'Amount Block Allowed' is Y, it is mandatory. If check box is N, Block priority will be disabled.

Guaranteed Fund

Optional

Select the option ‘Yes’ if you want the system to:

Dividend Equalization Applicable

Optional

Select ‘Yes’ from drop-down list to indicate dividend equalization is applicable.

Funds typically consist of units which have received some benefit in the form of income or dividend distribution and units which have not received any such inflows. The former are G1 units and the latter G2 units.

Since the income and dividend distribution rates are different for units belonging to the G1 and G2 groups, you can apply an equalization rate to equalize the benefit for the G2 units during dividend distribution. This rate will be considered only for the G2 units. To enable application of this rate, select ‘Yes’. Else you can retain the default value ‘No’ to carry out normal dividend distribution.

Note

You cannot maintain stock dividend if you select this option.

Allow Fee Calculation in Transaction Currency

Mandatory

If you select ‘Yes’ from drop-down list, then the field ‘Fee Calculation Basis’ will be provided at the transaction level, where you can indicate that load should be computed in terms of the transaction currency in addition to the fund base currency for the fund.

Maturity Date

Date Format; Mandatory

Specify the maturity date for the fund. This field is only visible and enabled if the fund is close-ended.

Retain IPO Balance?

Mandatory

Select ‘Yes’ from drop-down list to indicate that the IPO Balance of unit holders must to be stored for later use.

Allow Rejections before Allocation

Mandatory

Select ‘Yes’ from drop-down list to indicate that a rejection of a transaction as applicable, for all authorized transactions, prior to allocation. If this is not specified, then all authorized transactions will be taken up for allocation directly.

Allotment on Check Clearing

Mandatory

Select ‘Yes’ from drop-down list to indicate that allocation must be done on the check clearing date, using the price prevailing on that date, for transactions in which the payment mode is Check.

Ageing Policy

Optional

By default transactions are ordered in a First In First Out (FIFO) basis. If the unit holder has specified as to how transactions are to be ordered, then click on the drop-down menu and select Txn-Receipts. The drop-down list displays the following values:

For AMCs, those service distributors, where the distributor books are maintained in the AMC at hierarchical levels mutually decided on through a service level agreement, the option of ageing based on the hierarchy is available.

For funds in which there is a daily declaration of dividend (typically money market funds), and in which redemption transactions would be requested across non-taxable and taxable products, you can select the FIFO Across Products option if required. This feature is available only if your installation has specifically requested for it.

For Funds where IOF and IRRF taxes are applicable on the profits the ageing policy should selected to be ‘IOF/IRRF’ Optimization.

In case of Certificate Option funds, i.e. if certificate issue is to be based on the choice of the investor at the time of transacting, then the ageing policy can be specified as ‘Hierarchy’.

The USERMNTFIFO aging policy will use the Aging sequence maintained in Fund Preference Maintenance (UTDFPMNT) screen during allocation of outflow transaction.

VAT Percentage

Numeric; 5 Characters; Optional

Specify the VAT percentage.

Exchange Rate Source

Alphanumeric; 6 Characters; Optional

You can specify the exchange rate source from which the exchange rate for cash dividends must be obtained. By default, the exchange rate source that you specify here is used for cash dividends.

Cancel Instruction

Alphanumeric; 2 Characters; Optional

You can use this field to indicate whether standing instructions defined in respect of a unit holder, in the fund, are to be cancelled. If you select this option, the standing instructions for the transaction are cancelled, including those that are to be generated after an automatic redemption occurs. Select the ‘Standing Instruction’ option in this field to indicate cancellation of standing instructions.

If this option has been chosen in the General Operating Rules, the automatic redemption process generates redemption transactions for unit holders in the fund, with the ‘Cancel Instruction’ option automatically set.

If this option is set for an outflow transaction such as redemption, switch or transfer, the End of Day process cancels all standing instructions (irrespective of the transaction type) for the unit holder in the fund after the outflow transactions involving the unit holder have been allocated for the day.

Investment Simulation Method

Mandatory

Specify if the investment simulation option would be applicable for the fund or not by selecting an option from the drop down list. The options are:

Refer to the chapter ‘Generating Reports’ in Volume II of the Agency Branch User Manual for further information regarding investment simulation.

Fund Risk Level

Numeric; 3 Characters; Optional

Specify fund risk level details. Alternatively, you can select fund risk level from the option list. The list displays all valid fund risk level maintained in the system.

If restricted fund is selected as ‘Yes’, then Fund risk level will be defaulted to null. You can modify it.

Note

You can configure Fund risk level and investor risk level at param maintenance for FUN­DRISKPROFILE and INVRISKPROFILE param codes respectively. The system will vali­date the fund risk for an investor in ‘Investor Fund Risk Rating Mapping’ screen.

Fund Risk Level Description

Display

The system displays the description for the selected fund risk level details.

3.1.6.2 Automatic Redemption Preferences Tab

If the fund is to have automatic redemption of units of the unit holder based on the threshold balance, the preferences and guidelines may be laid down in this section.

Click on ‘Automatic Redemption Preferences’ tab to maintain these details:

 

Automatic Redemption Allowed?

Mandatory

Select ‘Yes’ from drop-down list to indicate that Automatic Redemption is to be allowed for the fund. This is applicable only for Open Ended funds. When the balance the unit holder falls below a defined minimum level, then the investor will be intimated about it and will be provided with some lead-time to either increase the balance above the minimum level or redeem all his units. After the elapsed lead- time, if the unit holder balance still lies below the defined minimum level, then the automatic redemption of those units will be done.

If automatic redemption is allowed for the fund, and this box is checked, the following fields are enabled:

Elapsed Days

Numeric; 22 Characters’ Optional

Enter the number of days from the date of intimation after which Automatic Redemption will be initiated. This is the lead-time provided to the investor.

Minimum Balance

Numeric; 30 Characters’ Optional

Enter the minimum balance (in amounts / units based on what balance type has been specified above) to be maintained for Automatic Redemption.

Minimum Balance Type

Optional

Select the type of Minimum balance to be maintained for Automatic Redemption from the drop-down list. The list displays the following values:

3.1.6.3 Min / Max Holding Check Tab

You can indicate the minimum/maximum holdings balance that is required for redemption, switch or transfer transaction, for a CIF or an individual unit holder, in the fund. The minimum holdings value can be specified either as an amount, number of units, or redeemable value of units.

Click on ‘Min / Max Holding Check’ tab to maintain these details:

 

As part of the minimum holdings options, you can also indicate whether the holdings considered for validation are those of all unit holders under a CIF, or for an individual unit holder.

Note

The above check is not validated online during transaction capture or authorization. When there are transactions into a fund violating the minimum holdings validation, the system logs an exception in the Pre-End of Day Check screen. During the End of Day processes, the system allocates the transactions, logging the exceptions in respect of them.

Minimum Holdings Amount

Numeric; 18 Characters; Mandatory if Minimum Holdings Indicator is specified

Specify the minimum redeemable value of holdings in the fund, for a redemption, switch or transfer transaction involving a CIF or individual unit holder.

Example

For the Royal Trust Growth Fund, you have selected the ‘Amount’ option as the Minimum Holdings Indicator for redemption, switch and transfer transactions. You have also specified the Minimum Holdings Amount value as 1200 USD (the fund base currency is USD).

The minimum holdings validation is required to be enforced for individual unit holders and not for CIFs.

Therefore, the redeemable value of total number of units held by an individual unit holder, in the Royal Trust Growth Fund must exceed or equal 1200 USD, for a redemption, switch or transfer transaction involving the unit holder.

Minimum Holdings Indicator

Mandatory

Select the basis upon which the minimum holdings check is performed from the drop-down list. The list displays the following values:

If you choose either of the last two options (Lower of Amount/Units or Higher of Amount/Units), you must specify the applicable minimum amount in the Minimum Holdings Amount field as well as the applicable minimum number of units in the Minimum Holdings Units field. Also, in either case, the redeemable value of the total number of units held by all investors under the CIF is considered for validation, if the check is to apply at CIF level.

Minimum Threshold limit

Numeric; 5 Characters; Optional

Specify the percentage value to be applied on minimum balance amount or units setup here.

Max Lock-in Period for Gain (Days)

Numeric; 4 Characters; Optional

Specify the maximum lock-in period beyond which if the subscription is redeemed gains would be passed over to the Unitholder and so IOF and IRRF taxes will be applicable. This should be greater than or equal to the Min Lock-in Period.

Note

When a transaction is redeemed within the Lock-In period, redemption happens at the low­est applicable NAV as on date of Subscription or on the date of Redemption.

Default Lock-in Period for Gain (Days)

Numeric; 4 Characters; Optional

Specify the default lock-in period within which if the subscription is redeemed no gains would be passed over to the Unitholder and so IOF and IRRF taxes will not be applicable.

Note

The default lock-in period should be within the minimum and maximum lock in period.

Minimum Holdings Units

Numeric; 27 Characters; Mandatory if Minimum Holdings Indicator is specified

Specify the minimum number of units required to be held by an individual unit holder, or a CIF, in the fund, for a redemption, switch or transfer transaction.

Example

For the Carey Bugle Growth Fund, you have selected the ‘Units’ option as the Minimum Holdings Indicator for redemption, switch and transfer transactions. You have also specified the Minimum Holdings Units value as 1000.

The minimum holdings validation is required to be enforced for individual unit holders and not for CIFs.

Therefore, the total number of units held by an individual unit holder, in the Carey Bugle Growth Fund must equal or exceed 1000 units, for a redemption, switch or transfer transaction involving the unit holder.

A note on the minimum holdings validation

If the Minimum Holdings Indicator selected is ‘Lower of Amount/Units’, the redeemable value of the specified Minimum Holdings Units is arrived at, and compared with the Minimum Holdings Amount specified. The lower of the two values is considered as the minimum holdings value against which the minimum holdings validation would be made. Similarly, if the Minimum Holdings Indicator selected is ‘Higher of Amount/Units’, the redeemable value of the specified Minimum Holdings Units is arrived at, and compared with the Minimum Holdings Amount specified, and the higher of the two values is considered as the minimum holdings value against which the minimum holdings validation would be made.

Example

For the Burton Carey Growth Fund, you have selected the ‘Lower of Amount/Units’ option as the Minimum Holdings Indicator for redemption, switch and transfer transactions. You have also specified the Minimum Holdings Amount value as 1200 USD, and the Minimum Holdings Units value as 1000 units.

The minimum holdings validation is required to be enforced for CIFs, and not for individual unit holders.

To arrive at the minimum holdings value against which the validation would be made, the redeemable value of 1000 units is computed, at the redemption price. If the redemption price is 0.8, the redeemable value = 1000 * 0.8 = 800 USD.

The redeemable value obtained (800 USD) is compared with the Minimum Holdings Amount specified (1200 USD). Since the Minimum Holdings Indicator chosen is ‘Lower of Amount/Units’, the minimum holdings value to be validated against, is 800 USD. Therefore, the redeemable value of total number of units held by all unit holders under a CIF, in the Burton Carey Fund must equal or exceed 800 USD, for redemption, switch or transfer transaction involving a CIF.

If the Minimum Holdings Indicator were selected as ‘Higher of Amount/Units’, the higher value (1200 USD) would be considered as the minimum holdings value against which the validation would be made. Therefore, the redeemable value of total number of units held by all unit holders under a CIF, in the Burton Carey Fund would have to equal or exceed 1200 USD, for a redemption, switch or transfer transaction involving a CIF.

Minimum Holdings Apply For

Optional

Select whether the minimum holdings check is applicable for CIFs, or for individual unit holders from the drop-down list. The list displays the following values:

If you select ‘CIF’ option, the redeemable value of the total number of units held by all unit holders under the CIF in the fund is considered for validation.

Min Lock-in Period for Gain (Days)

Numeric; 4 Characters; Optional

Specify the minimum lock-in period applicable for the fund. During subscription transaction, the lock-in period specified at the transaction level should be equal to or greater than the minimum period indicated here.

3.1.6.4 Advance Options Tab

Click on ‘Advance Options’ tab to maintain specify advance options:

 

You can specify the following fields in this screen:

GO Applicable?

Mandatory

Select if GO is applicable or not from the adjoining drop-down list. Following are the options available:

.If the value ‘Yes’ is selected, then the fund will be eligible for ‘GO’ generation. If the value ‘No’ is selected, then the fund will not be eligible for GO generation. However, if the value ‘with trading box’ is selected, then the fund will be eligible for GO generation by applying the trading box functionality and not the GO Maintenance feature.

Refer the Suspense Accounts, Statutory Accounts and Trading chapter in the Fund Manager

User Manual for a fuller discussion of the trading functions available in the FC-IS system.

CDSC Fund?

Alphanumeric; 2 Characters; Optional

If Contingent Deferred Sales Charge (CDSC) is applicable for transactions in this fund, then specify the CDSC calculation method to be used for the fund. The options are:

The CDSC load should be of period based. CDSC fund load set up for redemption method to derive the CDSC amount is calculated as follows:

CDSC Load Amount = NR Units * Redemption TBP * CDSC Load %

CDSC Applicable for Switches?

Optional

Select ‘Yes’ from drop-down list to indicate that the Contingent Deferred Sales Charge (CDSC) must be applicable to switch or exchange transactions.

Reinvestments First

Optional

Select ‘Yes’ from drop-down list to indicate that reinvestment transactions must be taken up first for aging during computation of Contingent Deferred Sales Charge for redemption transactions in this fund.

This field is not applicable for onshore funds having ‘USERMNTFIFO’ ageing Logic.

Interest Rate

Numeric; 15 Characters; Optional

Specify the interest rate.

Performance Fee Threshold

Numeric; 5 Characters; Optional

Specify the performance fee threshold details.

EUSD Scope

Optional

Select the EUSD scope of the fund from the drop-down list. The list displays the following values:

i.e. if EUSD is applicable only for redemption and switch transactions or only for dividend or for both.

Swinging Price Basis

Display

The system displays the Swinging Price Basis as maintained at the Fund Family Level.

If swinging price basis is not ‘No’ at the fund level, then reference currency and exchange rate source fields should be maintained at the fund family level. The sale value of the funds is converted to the reference currency to arrive at the swinging price.

Include Holding Period

Optional

Select whether the holding period should be considered or not from the drop-down list, while calculating the age of investments during computation of Contingent Deferred Sales Charge.

Note

This option will be enabled only for CDSC applicable funds.

Threshold Basis

Mandatory if the swinging price basis is semi swinging

Select the basis as Amount or Percentage from the drop-down list.

Dilution Levy Applicable

Optional

Select ‘Yes’ from drop-down list if dilution levy is applicable for the fund or else select ‘No’. Outflow and inflow breach factor can be maintained only if the value in this field is maintained as ‘Yes’. To arrive at dilution breach limit amount the system considers the inflow breach factor for IN transactions and the Outflow breach factor for OUT transactions.

Threshold Value

Numeric; 30 Characters; Mandatory if the swinging price basis is semi swinging

Specify the threshold value for the semi swinging price basis fund.

Only daily priced funds can be grouped under a fund family. For non daily price funds, if swinging price is applicable, each fund will have to be mapped to a separate family.

Inflow Breach Factor(%)

Numeric; 5 Characters; Optional

Specify the breach factor for inflow transactions, as a percentage of the fund value upon which dilution levy is applicable.

Outflow Breach Factor

Numeric; 5 Characters; Optional

Specify the breach factor for outflow transactions, as a percentage of the fund value, upon which dilution levy is applicable.

Fund Tax Class

Alphanumeric; 3 Characters; Optional

Specify tax class of a fund details. Alternatively, you can select fund tax class details from the option list. The list displays all valid fund tax Class details maintained in the system.

Fund Grouping

Alphanumeric; 6 Characters; Optional

Specify fund grouping details to group the funds under one fund. Alternatively, you can select fund grouping details from the option list. The list displays all valid fund grouping details maintained in the system.

You can group the different Tax Class Funds under one group for Tax Class Switch using this field. If you want to create four funds in the system, then the fund group ID should be one of the fund IDs of the four funds that you intend to create.

WAC Method

Optional

Select the WAC method from the drop-down list. The list display the following values:

If you select Life WAC and Base Cost is not provided while capturing a transaction, then the system will calculate Weighted Average Cost (WAC) as follows:

LIFE WAC = ((No of units in the fund before inflow) * (WAC before inflow) + (No of units in the inflow for fund) * (Unit Price of inflow)) / (Total Units in Fund)

Where,

Unit price = (Net investment amount) / number of units purchased

Net Investment amount = Gross investment amount – all Fee except the ones which are paid to AMC

The net investment amount will not exclude any Fee for which To Entity is AMC. The system will deduct any other fee (apart from those where To Entity is AMC) from the gross investment amount to arrive at the net investment amount.

Total units in Fund = (No of units in the fund) + (No of units in the inflow for the fund)

If you select a product with WAC method as LIFE WAC, and if a Switch transaction is done within the same Fund Family and Base Cost is not provided while capturing the transaction then the system will calculate WAC as follows:

Life WAC = ((No of units rolling over) * (WAC in ‘From’ Fund) + (No of units in the ‘To’ fund) * (WAC in ‘To’ Fund)) / (Total Units in ‘To’ Fund)

Where Total units in ‘To’ Fund = (No of units rolling over into To Fund) + (No of units in the ‘To’ fund)

The system will calculate Capital Gain or Loss as follows:

Gain / Loss = Units surrendered / redeemed from Fund* ((Price of fund on the date of Redemption / Surrender) – WAC for fund)

If there is a gain then Capital Gain Tax has to be deducted.

To deduct the capital Gain Tax, a separate Load will be mapped under Product load mapping as post allocation load. If the Slab basis is selected as weighted average then this load will be applied on the Gain portion and tax will be deducted and only the net amount will be paid to the customer.

If the Fund Family of Switch Out and Switch In Fund is same, the calculations for the Switch Out Leg will change to the extent wherein Gain will be calculated as 0.

Processing of Swinging Price

For a swinging price fund, the system computes the net transaction of sales value (Inflow - Outflow) on the application date (current date) at fund family level for the given fund and arrives at the fund price

The gross amount in the fund family base currency is used for the net of sales value computation. For unit based transactions, the net sales is computed as follows: units applied * latest available NAV.

For Semi Swinging Funds, the system computes the net of sales value (Inflow – Outflow) for transaction date at fund family level for the given fund and arrives at the fund price based on threshold basis at fund level as follows:

If Threshold Basis is Amount then:

If Threshold Basis is Percentage then:

Net asset value of the fund is computed as the BOD outstanding units * latest available NAV. The reference types mapped at fund family level is used to compute the net of sales value. The swinging price computed is used for unitizing all transaction types mapped at fund family level.

For transaction types not mapped at fund family level, the system does not use swinging price. The system uses the gross amount in fund base currency for net of sales value computation. For unit based transactions, the net of sales is computed by using units applied * latest available NAV.

A mini EOD computes and populates the swinging price and swinging price basis for Swinging Price and Semi Swinging Price Fund. This mini EOD is run during the day to arrive at the Total Inflow, Total Outflow, and Net Sales value.

3.1.6.5 Limit Order Processing Options Tab

Click on ‘Limit Order Processing Options’ tab to maintain these details:

 

Allow Limit Orders

Optional

Select ‘Yes’ from drop-down list to indicate that limit order processing is enabled for the fund.

Allow Future Dated Transaction

Optional

Select ‘Yes’ from drop-down list to indicate that future dated transactions, in respect of limit order processing, are allowed for the fund.

Automatic Processing

Optional

Select ‘Yes’ from drop-down list to indicate that automatic processing, in respect of limit order processing, is allowed for the fund.

This option is intended for funds floated by your AMC. If automatic processing is enabled for such funds, the limit order transactions are automatically generated and allocated by the end of day processes according to the price and date options specified. For third party funds, where your AMC would proceed with limit order processing only after appropriate confirmation is received, you could disable this option.

Pricing Rule

Optional

Select the option to be considered if the date on which the limit order is to be executed is a fund or system/ AMC holiday. You could indicate that the transaction be generated prior to the holiday, or following the holiday. Select the appropriate option (Prior or After) from the drop-down list.

3.1.6.6 Transaction Cancellation Period Tab

In this section, you must maintain the options in the fund rules for processing cancellations of transactions. Click on the ‘Transaction Cancellation Period’ Tab to maintain the details:

 

You can specify the following details in this screen:

Transaction Cancellation Period

Numeric; 3 Characters; Optional

You can specify a number of calendar days that represents a period from the date of transaction within which cancellations are allowed.

Transaction Cancellation Allowed

Optional

Select whether cancellation is allowed for the fund. Choose ‘Yes’ from the drop-down list if you wish to allow cancellation or else choose ‘No’.

Cancellation Period Calendar Basis

Optional

Select the cancellation period from the drop-down list. The list displays the following values:

Allow Switching in Cancellation Period

Optional

You can specify if you wish to allow switch transactions any time within the cancellation period. Choose ‘Yes’ from drop-down list to allow switches in the holdings due to the transaction else choose ‘No’.

Cancellation Price Basis

Alphanumeric; 10 Characters; Optional

Specify the price basis to be followed for cancellations. The price basis could be NAV for a single pricing fund. For other type of funds, the basis could be Bid or Offer Price.

The current market value computation as well as the cancellation amount would depend on the bid / offer / NAV.

The system will consider original Subscription price as cancellation price during allocation. While adding subscription load amounts to redemption proceeds, the system will consider only Fee paid by the unitholder.

3.1.6.7 Check Writing Tab

In this section, you can specify the rules that govern check writing for the fund, such as:

Click on the ‘Check Writing’ Tab to indicate the check writing options:

 

You can specify the following details in this screen:

Allow Check Writing

Mandatory

You can use this field to indicate whether cheque writing facility is allowed for investors who invest in this fund. Select ‘Yes’ from drop-down list to indicate that cheque writing is allowed.

Minimum Amount for Checks

Numeric; 18 Characters; Optional - If cheque writing is allowed for the fund, then this information is mandatory.

Specify the minimum amount that can be redeemed through a redemption cheque, for investors holding balances in the fund, who have opted for cheque writing facility. If the amount written on a cheque falls below this value, the cheque attracts penal charges.

Maximum Amount for Checks

Numeric, 18 Characters; Optional - If cheque writing is allowed for the fund, then this information is mandatory.

Specify the maximum amount that can be redeemed through a redemption cheque, for investors holding balances in the fund, who have opted for cheque writing facility. If the amount written on a cheque exceeds this value, the cheque attracts penal charges.

Minimum Holding Period Violation

Mandatory

You can use this field to indicate whether a violation of the holding period for balances in this fund, by a unit holder using the cheque writing facility must be validated for. Select ‘Yes’ from drop-down list to indicate validating of violation of the holding period.

Stop Payment Request on Check

Mandatory

You can use this field to indicate whether a stop payment request can be applied on a cheque issued by a unit holder availing cheque writing facility, for this fund. Select ‘Yes’ from drop-down list to indicate that a stop payment can be applied.

Minimum and Maximum Check Amount Violation

Mandatory

You can use this field to indicate whether a violation of the minimum and maximum cheque amounts by a unit holder using the cheque writing facility in this fund, must be validated for. Select ‘Yes’ from drop-down list to indicate validating of violation of the maximum and minimum cheque amounts.

Minimum Holding Period (Days)

Numeric; 5 Characters; Optional - If check writing is allowed for the fund, then this information is mandatory.

Specify the minimum number of days for which units must be held in the investor account before they can be redeemed through a redemption cheque.

Account Closure

Mandatory

You can use this field to indicate whether an investor can close the unit holder account through cheque redemption. Select ‘Yes’ from drop-down list to indicate that account closure through cheque writing is allowed.

Penalty Applicable

Mandatory

You can use this field to indicate whether an investor can close the unit holder account through a cheque redemption. Select ‘Yes’ from drop-down list to indicate that account closure through cheque writing is allowed.

Insufficient Account Balance

Mandatory

You can use this field to indicate whether insufficient balance in this fund, in the account of a unit holder using the cheque writing facility must be validated for. Select ‘Yes’ from drop-down list to indicate validating of insufficient balance situations.

3.1.6.8 Regulations Tab

In this section you can capture the details regarding Foreign Account Tax Compliance Act. Click on ‘Regulations’ tab to maintain the details.

 

You can specify the following details in this screen:

FATCA Information

FATCA Applicable

Mandatory

Select Yes or No from drop-down list to indicate whether FATCA is applicable. However, the system defaults the value ‘No’.

Employer ID Number (EIN)

Display

The system displays the employer ID number.

FATCA Classification

Alphanumeric; 25 Characters; Optional

Select the classification of FATCA from the adjoining option list. FATCA Classification is mandatory if FATCA Applicable is ‘Yes’.

Classification Description

Display

The system displays the description for the selected FATCA classification code.

FATCA Reason

Alphanumeric; 255 Characters; Optional

Specify the reason for FATCA classification.

FATCA Effective Date

Date Format; Optional

Specify the FATCA Effective Date if FATCA is applicable.

FATCA Effective Date cannot be lesser than the fund start date.

FATCA Sponsor Type

Optional

Select the type of FATCA sponsor from the drop-down list. Following are the options available in the drop-down list:

FATCA WHT Applicable

Optional

Select if FATCA WHT is applicable or not from the drop-down list. Following are the options available in the drop-down list:

Sponsoring Entity Type

Alphanumeric; 1 Characters; Optional

Specify the sponsoring Entity type. You can also select the valid sponsoring entity type from the adjoining option list.

FATCA WHT Indicator

Optional

Select the FATCA WHT indicator from the drop-down list. Following are the options available in the drop-down list:

Sponsoring Entity ID

Alphanumeric; 12 Characters; Optional

Specify the sponsoring Entity ID. You can also select the valid sponsoring entity ID from the adjoining option list.

FATCA WHT Dividend Level

Optional

Select the FATCA WHT dividend level from the drop-down list. Following are the options available in the drop-down list:

Global Intermediary Identification Number (GIIN)

Alphanumeric; 30 Characters; Optional

Specify the global intermediary identification number.

FATCA WHT Intermediary Commission

Optional

Select the FATCA WHT broker commission from the drop-down list. Following are the options available in the drop-down list:

GIIN Issue Date

Date Format; Optional

Specify the GIIN issue date.

The GIIN issue date cannot be greater than the application date.

FATCA WHT Trailer Commission

Optional

Select the FATCA WHT trailer commission from the drop-down list. Following are the options available in the drop-down list:

GIIN Expiry Date

Date Format; Optional

Specify the GIIN expiry date.

The GIIN expiry date cannot be lesser than the GIIN issue date.

GIIN Verified Flag

Display

System displays the GIIN verified flag based on the GIIN. If you specify the GIIN then, GIIN verified flag gets displayed as ‘No’. If you select the GIIN then, GIIN verified Flag gets displayed as ‘Yes’.

UCITS Fund

UCITS Fund

Optional

Select if the fund is UCITS or not from the drop-down list. The list displays the following values:

MIFID

MIFID Fund

Optional

Select if the fund is scoped under MIFID regulation or not from the drop-down list. The list displays the following values:

Target Market

Alphanumeric; 255 Characters; Optional

Specify the country code of the Country to which the product is sold as part of MIFID regulation. Alternatively, you can select the country code maintained in the system. The system displays all valid country code maintained in the system.

Investment Horizon

Optional

Select the investment objective from the drop-down list. The list displays the following values:

MIFID Product Classification

Alphanumeric; 1 Character; Optional

Specify the MIFID Product Complexity details. It is a mandatory field for MIFID funds.

MIFID Product Classification Description

Display

The system displays the description of the selected MIFID Product Complexity.

3.1.6.9 Ageing Policy for Fund

A subscription transaction entered into by an investor into any fund can be tracked till the units resulting from the transaction have been cleared in full from the unit holder account of the investor. This is known as ageing.

Each fund may have a different approach to ageing a transaction. The approaches followed in Oracle FLEXCUBE Investor Servicing are presented below:

FIFO (First In First Out)

In this approach, in a scrip-less fund, the unit balance resulting from the earliest transactions of the unit holder in the fund would be considered for redemption.

Ageing based on Transaction Receipts

In this approach, in a scrip-less fund, the unit balance resulting from any earlier transaction chosen by the unit holder, based on the receipt presented for the same, would be considered for redemption.

Hierarchy

If the AMC services distributors according to a service level agreement, and the distributor books are maintained at the AMC, the option of ageing transactions received from the distributors according to the hierarchy agreed to, is available. The allocation process updates the balances at a unit holder and fund level. The distributor books are a reflection of the underlying hierarchy holdings based on the AMC-Distributor agreement.

IOF/IRRF Optimization

If a fund has IRRF/IOF taxes applicable, provided the fund holding is redeemed within a stipulated time then the IRRF/IOF based funds and the subscription transactions to be redeemed are selected in the following order of priority.

Funds following the IRRF/IOF taxation method need to be classified as “Pension Funds” and “Non Pension Funds”.

FIFO across products

In money market funds in which there is a daily declaration of dividend, the ordering of transactions for ageing, in the event of redemption, is based on the FIFO principle. In addition, the dividend due to the unit holder as a result of the transactions that has been distributed in the present payment cycle is also considered.

After the dividend computation is made and the appropriate tax deducted, the transactions are ordered for ageing based on non-taxable and taxable holdings of the unit holder across products, in the following sequence:

  1. Units for which the retention period has expired and which have already gone through a minimum of one dividend cycle and are taxable
  2. Units for which the retention period has expired and which have not gone through a single dividend cycle and are taxable
  3. Units for which the retention period has expired and which have already gone through a minimum of one dividend cycle and are not taxable
  4. Units for which the retention period has expired and which have not gone through a single dividend cycle and are taxable
  5. Units for which the retention period has not expired and which have not gone through a single dividend cycle and are taxable
  6. Units for which the retention period has not expired and which have not gone through a single dividend cycle and are not taxable

Note

This feature (FIFO across products) is available only if your installation has specifically re­quested for it.

3.1.6.10 Specifying Limit Order Options for Funds

For a fund, you can specify the following options for processing limit orders, in the General Operating Rules screen:

Automatic processing for limit orders involves the automatic generation of buy or sell transactions. If your AMC processes limit orders for third party funds, and must wait for confirmation before processing the orders on the specified dates, you might need to disable automatic processing.

You specify the limit order options in the Limit Order Processing Options section of the General Operating Rules screen.

3.1.6.11 Indicating Re-computation of Fund Prices and Adjustment of Units

The fund prices of funds like Employee Benefit Growth Fund are derived based on the forecasted rate of growth. The rates will be re-forecasted in the interim several times and the actual rate of growth is published at the end of the year.

If you choose the option ‘Yes’ for Guaranteed Funds, the system will:

Example

Let us assume that a Fund (F100) is launched with the price of 10 ZAR with the forecasted rate of 10% per annum. Consequently, 10 * 10/ (100 * 365) = 0.0027 will be the increase in price till a new rate is declared. Please note that the price used here is an example and not the exact formulae as such.

Day 0 à 10 ZAR

Day 1 à 10.0027 ZAR

Day 2 à 10.0054 ZAR

Day 3 à 10.0081 ZAR

Day 4 à 10.0108 ZAR

Day 5 à 10.0135 ZAR

Day 100 à 10.27 ZAR

Day 101 à 10.2727 ZAR

Day 102 à 10.2754 ZAR

Day 103 à 10.2781 ZAR and so on….

If an investor invests on Day 2 the transaction will get unitized using the price 10.0054…

Assume these are trades captured on Day 2 @ 10.0054…

UH ID

Fund ID

Subscription Amount (in ZAR)

Units

UH1

F100

10,000

999.460

UH2

F100

20,000

1998.921

UH3

F100

30,000

2998.381

UH4

F100

35,000

3498.111

UH5

F100

25,000

2498.651

UH6

F100

15,000

1499.190

Assume these are trades captured on Day 100 @ 10.27…

UH ID

Fund ID

Redeems Units

Redeems Proceeds (in ZAR)

UH1

F100

100

1027.00 ZAR

UH5

F100

2498.651

25661.15 ZAR

Therefore, the balance of the investors in Fund F100 will be:

UH ID

Fund ID

Balance (in Units)

UH1

F100

899.460

UH2

F100

1998.921

UH3

F100

2998.381

UH4

F100

3498.111

UH5

F100

0

UH6

F100

1499.190

Let us assume that a Fund Manager revises an interim forecast of 11% instead of 10%. Consequently, all the trades that are unitized during the current fiscal year of the fund will be considered for impact and the units will be recomputed based on the new prices.

Day 0 à 10 ZAR

Day 1 à 10.003 ZAR

Day 2 à 10.006 ZAR

Day 3 à 10.009 ZAR

Day 4 à 10.012 ZAR

Day 5 à 10.015 ZAR

Day 100 à 10.30 ZAR

Day 101 à 10.3030 ZAR

Day 102 à 10.3060 ZAR

Day 103 à 10.3090 ZAR

After subscription, the adjustment for the investors in F100 will be:

UH ID

Fund ID

Balance (in Units)

UH1

F100

999.1008 (Difference in units - 0.3595)

UH2

F100

1998.2020 (Difference in units-0.7190)

UH3

F100

2997.3020 (Difference in units - 1.0784)

UH4

F100

3496.8530 (Difference in Units - 1.2582)

UH5

F100

2497.7520 (Difference in Units - 0.8987)

UH6

F100

1498.6510 (Difference in units 0.5392)

The adjustment due to redemption will be:

UH ID

Fund ID

Balance (in Units)

UH1

F100

99.7087 (Difference units 0.3595)

UH5

F100

2491.3740 (Difference in units 0.8987)

The new/actual Balances are:

UH ID

Fund ID

Balance (in Units)

UH1

F100

899.3921

UH2

F100

1998.2020

UH3

F100

2997.3020

UH4

F100

3496.8530

UH5

F100

6.3780

UH6

F100

1498.6510

Based on this condition, the system redeems certain number of units from each investor.

UH ID

Fund ID

Balance (in Units)

UH1

F100

899.3921 - 899.460 = 0.0679

UH2

F100

1998.2020 - 1998.921 = 0.719

UH3

F100

2997.3020 - 2998.381 = 1.079

UH4

F100

3496.8530 - 3498.111 = 1.258

UH5

F100

6.3780 – 0 = 6.378

UH6

F100

1498.6510 - 1499.190 = 0.539

The system will generate a redemption transaction for the above adjustment units excluding the Investor UH5 and will be available for reporting only in case of interim run. If it is on actual rate at the end of the year, the same will be shared with other investors proportionately.

When the next interim or actual run is executed the system will ignore these adjustment redemptions and while adjusting units these adjusted units will taken into account.

3.1.7 Transaction Processing Rules Button

This fund rule lays down the guidelines according to which transactions of each transaction type will be processed for each fund. These guidelines include the following:

To set up the Transaction Processing Rules for a fund, use the Transaction Processing Rules screen.

You can invoke this screen by clicking ‘Transaction Processing Rules’ button from the ‘Fund Rules’ screen.

 

The screen displays the details of the fund for which the rules are being set up, in the Fund Information section, and the details of all Transaction Processing Rules already maintained for any transaction type, in the Maintained Transaction Details section. It also contains the following data entry sections, each of which can be invoked by clicking the appropriate tab:

The details of rules that have already been made for any transaction types, if any, are displayed in the Maintained Transaction Details section. The following information is displayed in the box for each transaction type, and clicking on the row of each transaction type will cause the transaction processing rules profile for that transaction type to be displayed in the lower portion of the screen, and in each of the sections.

If you need to view all the details of a particular transaction processing rules profile for a transaction type in the fund, click that transaction type in this box and the profile will be populated in the lower half of the screen and in the sections.

Note

Before you set up a Transaction Processing Rules profile record for a fund and transaction type, it is desirable to ensure that the following information is already setup in the system:

You can specify the following fields:

Fund ID

Display

This field indicates the ID fund for which you are setting up the Transaction Processing Rules profile. This information is defaulted from the Fund Demographics screen.

Rule Effective Date

Display

The Rule Effective Date for the fund, which you specified in the Fund Demographics screen, is displayed here.

3.1.7.1 Basic Info Tab

 

Transaction Type

Alphanumeric; 2 Characters; Mandatory

Specify the transaction type for which a transaction processing rules profile has been maintained for the fund.

Transaction Type Description

Display

The system displays the description for the selected transaction type.

Transaction Frequency

Mandatory

Select the frequency at which the transaction type will operate for the fund from the drop-down list. The list displays the following values:

Transaction Enabled?

Mandatory

Select ‘Yes’ from the drop-down list to indicate that the transaction is enabled for the fund. It is possible to set up a temporary suspension of transactions, even if the transactions are open for the fund.

Start Date

Date Format; Mandatory

Specify the date from which the transaction type is enabled for transaction entry and processing for the fund.

End Date

Date Format; Mandatory

Specify the date up to which the transaction type is enabled for transaction entry and processing for the fund.

Gross Amount

Mandatory

Select if the processing mode for transaction type is gross or not from the drop-down list.

Net Amount

Mandatory

Select if the processing mode for transaction type is Net or not from the drop-down list.

Gross Unit

Mandatory

Select ‘Yes’ for gross units from the drop-down list.

For transactions with a gross processing mode, the value of the transaction, whether as an amount or a number of units, will be processed as a gross value from which any applicable charges will be deducted.

Note

Opting for a gross or net mode in transaction processing is mode is only available for IPO, subscription or redemption transactions.

Net Unit

Mandatory

For transactions with a net processing mode, the amount value of the transaction will be processed as a net value apart from the charges.

Transaction Suspended?

Mandatory

You can use this field to suspend transactions of specific types for a fund. Check this box to indicate that the transactions of the selected type are suspended for the fund. The suspension would be enforced for transactions of the specific type both entered through the Transaction Detail screens as well as system-generated and uploaded transactions.

Note

If the fund is suspended (as specified in the Fund Demographics), transactions of all types are not allowed into the fund. If the fund is not suspended, transactions of specific types that have been suspended for the fund in the Transaction Processing Rules (if any) are not allowed

Restrict Sale to Investor

Mandatory

You can use this field to indicate that transactions of the selected type, into the fund must only be available to existing customers, and not to new customers. Select ‘Yes’ from drop-down list to indicate this.

If no such restrictions are applicable, select ‘No’ in this field.

When the system applies this restriction, it considers a new investor to be one whose balance holding in the fund is zero. This restriction is only applicable to the inflow transaction types subscription, switch in and transfer.

Maximum IPO Issue Size

Numeric; 27 Characters; Optional

Specify the maximum issue size for IPO transactions in the fund. This value places a restriction on the total IPO order value for the fund. If the total order value units exceed the maximum issue size, the number of allocated units is computed as follows:

Quantity allotted = Quantity applied * (Maximum issue size / Total order value)

Allow Systematic Plans?

Optional

Select ‘Yes’ from drop-down list to allow systematic plans. Select ‘No’ if you do not wish to allow systematic investment plans.

This indicator would be allowed for capture for IPO Subscription, Subscription, Redemption, Transfer and Switch type of transactions.

3.1.7.2 Transaction Rules Tab

In this section, the following details may be captured:

 

Start Period

Numeric; 22 Characters; Mandatory

Enter a value to specify the Start Period within the frequency mentioned above. Within a particular frequency, you have an option to restrict it to a particular period.

End Period

Numeric; 22 Characters; Mandatory

Enter a value to specify the End Period within the frequency mentioned above.

Example

Transaction Frequency is WEEKLY, Start Period is 2 and End Period is 5. This means that the Fund is open for this transaction from second day till the fifth day of the week.

The End period has to be within the Transaction Frequency i.e., it can take values up to 7 (weekly) and not greater than that.

Holding Period Applicable?

Mandatory

Select ‘Yes’ in this field to indicate that a lock in period is applicable for the investors investing in a money market mutual fund. If you select this option, then you must specify whether the holding period is to be enforced.

This feature is only available if your installation has requested for it.

Counter

Numeric; 22 Characters; Mandatory

Enter a value to specify the total number of transactions to be allowed in this transaction type.

Enforce Holding Period

Mandatory

Select ‘Yes’ from drop-down list to indicate that the minimum holding period specified for the fund in the Fund Demographics profile must be enforced as mandatory for the transaction type, by selecting this option.

This feature is only available if your installation has requested for it.

Start Time (HH24:MI:SS)

Time (hh: mm format); Mandatory

Enter a time to specify the start time for a given working date. On a given day when the fund is open for this transaction, you can start entering transactions from this time.

End Time (HH24:MI:SS)

Time (hh:mm format); Optional

Enter a time to specify the end time for a given working date beyond which you cannot enter any transactions for this transaction type.

Cut Off Time(HH24:MI)

Time (hh:mm format); Mandatory

Specify the time, on a given working day before which a transaction of the selected type will be accepted with the transaction date being the current date. Beyond this time on a working day, the transaction date will be set by default to be the next working date.

If electronic order (SWIFT/Upload) is received after cut off time, the system will automatically move to the next business day without displaying any warning message.

For SWIFT messages, message creation time to be considered for cut off time validation.

A new user maintainable parameter “UPLDCUTOFFTIME’ will be introduced.

If turned on and order received date and time is not present in upload file, the system will consider the time of transaction creation as order received time and trade date to be derived.

The appserver time will be taken into consideration for cut off time determination.

GO Threshold Units

Numeric; 27 Characters; Optional

Specify the Global Order threshold units.

If the difference units are more than the threshold units maintained then this will be handled manually.

If the difference units falls under the threshold units maintained, the system will automatically rounded off.

If the AMC confirmed units are more than that the system has allotted, then system calculates Negative (-ve) differential units.

If the AMC confirmed units are less than that the system has allotted, then system calculates Positive (+ve) differential units.

GO Cutoff Lag(HH24:MI)

Time (hh:mm format); Optional

Specify the additional time for the fund cut-off. The cut-off lag/time will be in addition to the cut-off time maintained for the fund for a selected AMC.

If a GO has been generated prior to amendment the new cut-off lag will be affected for the next GO generation onwards only. Already generated GO for the day will not be affected. However, if the GO is generated after the amendment, the system will consider the same with latest value.

The automated generation of GO will be achieved by using a time based scheduler. A procedure will be enabled to run the time-based scheduler after a predefined time interval say after every 5 minutes or 10 minutes. The time based scheduler will trigger automated Global Order generation process by adding the Cutoff time to the Fund Cut-Off Time. Once GO for a fund is generated the scheduler will mark the Global Order as generated.

The cut-off lag will accept any late transaction received in the system after the fund cut-off time and allows additional time before the GO is generated. This functionality is applicable only for Global Orders and not for Trading.

GO Settlement Lag

Numeric; 22 Characters; Optional

Specify the Global Order settlement lag details.

GO Settlement Lag Calendar

Optional

Select the Global Order settlement lag calendar details from the drop-down list. Following are the options available:

Details

Applicable Account Types

Alphanumeric; 255 Characters; Optional

Select one or more account types for which fund transfer is allowed. If you do not select any particular option, then all account types will be allowed. The validation of this rule will happen during the save of Standing Instruction as well as the different transactions including subscription and redemption.

3.1.7.3 Unit Holder Rules Tab

The limits on the number of transactions allowed for a unit holder in this transaction type and in this fund are captured in this section.

 

Frequency

Mandatory

This is to specify the frequency with which a unit holder can carry out any number of transactions within the limit specified earlier. Select the frequency from the drop-down list. The list displays the following values:

Free

Numeric; 22 Characters; Mandatory

Enter a value to specify the number of free transactions within the permitted transactions. This definition will override all loads that will be set for this transaction

Note

You can not modify the frequency or the cycle basis of the Unitholder limits. However you are allowed to modify the number of free transaction number which will only be applicable from the subsequent cycles and not immediately.

While tracking free transactions, pseudo switch transactions will be treated on par with switch transactions. The Redemption leg of the pseudo switch transaction will be treated on par with Switch from and the subscription leg of the pseudo switch transaction will be treated on par with switch to.

Limit

Numeric; 22 Characters; Mandatory

Enter a value to specify the number of transactions that are allowed for a unit holder. You can restrict the unit holder from operating more than the specified limit for transactions.

Cycle Basis

Optional

Provided the frequency selected is yearly, you are allowed to specify the period basis during which the free transactions will be applicable. Select the cycle basis from the drop-down list. The list displays the following values:

The option ‘Actual Calendar Basis’ will be enabled only if the frequency is ‘Yearly’.

Note

If the free transaction is reversed and the transaction date of the transaction belongs to the current cycle, the free transaction counter will be increased by 1. If it belongs to the previ­ous cycle the counter will not be affected.

3.1.7.4 Transaction Limit Tab

You can use this screen to indicate the minimum volume limits for initial transactions and the limits for standing instruction transactions for investors in a fund, for a certain transaction type.

You can also specify the minimum holdings balance for an IPO or subscription transaction in respect of a standing instruction, for a CIF or an individual unit holder, in the fund.

You can access this screen from the Transaction Processing Rules profile screen for each fund, by clicking on the Limits for SI/Investment link in the Transaction Limits section.

When you save your specifications in this screen, it will be closed and you will be returned to the main Transaction Processing Rules screen. When you save the transaction processing rule record for the fund, the specifications you have made in this screen are saved as part of the same record, in the database.

The volume limits on transactions in the transaction type are captured here.

The limits that may be specified here depend upon the Application Mode specified for this transaction type. If the Mode specified is Amount, then the Amount limits in this section are mandatory. If the Mode is Units, the Units limits are mandatory. If the Mode is ‘Both’, then both limits are mandatory.

 

Minimum Amount

Numeric; 22 Characters; Optional

Specify the minimum transaction amount allowed for this transaction type in this fund.

Minimum Units

Numeric; 22 Characters; Optional

Specify the minimum number of units that may be applied for in this transaction type in this fund.

Maximum Amount

Numeric; 22 Characters; Optional

Enter a value to specify the Maximum Transaction Amount that a unit holder can invest or redeem. This is the maximum amount that can be accepted for the fund for this given transaction type.

Maximum Units

Numeric; 22 Characters; Optional

Enter a value to specify the Maximum Transaction Units that a unit holder can invest or redeem.

This operates in lines similar to that of the Transaction Amount.

The maximum volume (in terms of units) of a single transaction that is entered should never exceed or be equal to the figure of one billion.

For instance, if a user wishes to enter a transaction of 1.5 billion units, he will have to consider entering two transactions, with neither exceeding a maximum limit of 999999999.999999 units.

Min. Initial Transaction Amount

Numeric; 30 Characters; Optional

Specify the minimum amount permitted for an initial transaction, for an investor in this fund.

Min. Initial Transaction Units

Numeric, Optional

Specify the minimum number of units permitted for an initial transaction, for an investor in this fund.

SI Minimum Amount

Numeric; 22 Characters; Optional

Specify the minimum amount allowable for a standing instruction transaction in this fund.

SI Minimum Units

Numeric; 22 Characters; Optional

Specify the minimum number of units allowable for a standing instruction transaction in this fund.

SI Minimum Holdings Amount

Numeric; 22 Characters; Optional

Specify the minimum redeemable value of holdings in the fund, for an IPO or subscription transaction in respect of a standing instruction involving a CIF or individual unit holder.

Example

For the Royal Trust Growth Fund, you have selected the ‘Amount’ option as the Minimum Holdings Indicator for IPO or subscription transactions that would be generated in respect of standing instructions. You have also specified the Minimum Holdings Amount value as 1200 USD (the base currency of the fund is USD).

The minimum holdings validation is required to be enforced for individual unit holders and not for CIFs.

Therefore, the redeemable value of total number of units held by an individual unit holder, in the Burton Carey Fund must exceed or equal 1200 USD for an IPO or subscription transaction in respect of a standing instruction involving the unit holder.

Step Amount

Numeric; 22 Characters; Optional

Enter a value to specify the steps of amount in which a unit holder can invest or redeem.

Step Units

Numeric; 22 Characters; Optional

Enter a value to specify the steps of units in which a unit holder can invest or redeem. This will operate above the Minimum Transaction Units.

SI Maximum Amount

Numeric; 22 Characters; Optional

Specify the maximum amount allowable for a standing instruction transaction in this fund.

Note

If the client country parameter is set to “SIRULEATFREQ” for your bank, in order to main­tain SI specific details click on the link ‘SI Rules for Frequency under the Transaction limit tab. For further reference please refer to the Annexure.

SI Maximum Units

Numeric; 22 Characters; Optional

Specify the maximum number of units allowable for a standing instruction transaction in this fund.

Note

If the client country parameter is set to “SIRULEATFREQ” for your bank, in order to main­tain SI specific details click on the link ‘SI Rules for Frequency under the Transaction limit tab. For further reference please refer to the Annexure.

SI Minimum Holdings Units

Numeric; 22 Characters; Optional

Specify the minimum number of units required to be held by an individual unit holder, or a CIF, in the fund, for an IPO or subscription transaction in respect of a standing instruction.

Example

For the Carey Bugle Growth Fund, you have selected the ‘Units’ option as the Minimum Holdings Indicator for IPO or subscription transactions that would be generated in respect of standing instructions. You have also specified the Minimum Holdings Units value as 1000.

The minimum holdings validation is required to be enforced for individual unit holders and not for CIFs.

Therefore, the total number of units held by an individual unit holder, in the Carey Bugle Growth Fund must equal or exceed 1000 USD, for an IPO or subscription transaction in respect of a standing instruction involving the unit holder.

A note on the minimum holdings validation

If the Minimum Holdings Indicator selected is ‘Lower of Amount/Units’, the redeemable value of the specified Minimum Holdings Units is arrived at, and compared with the Minimum Holdings Amount specified. The lower of the two values is considered as the minimum holdings value against which the minimum holdings validation would be made. Similarly, if the Minimum Holdings Indicator selected is ‘Higher of Amount/Units’, the redeemable value of the specified Minimum Holdings Units is arrived at, and compared with the Minimum Holdings Amount specified, and the higher of the two values is considered as the minimum holdings value against which the minimum holdings validation would be made.

Example

For the Burton Carey Growth Fund, you have selected the ‘Lower of Amount/Units’ option as the Minimum Holdings Indicator to be validated for successful generation of an IPO or subscription transaction in respect of a standing instruction. You have also specified the Minimum Holdings Amount value as 1200 USD, and the Minimum Holdings Units value as 1000.

The minimum holdings validation is required to be enforced for CIFs, and not for individual unit holders.

To arrive at the minimum holdings value against which the validation would be made, the redeemable value of 1000 units is computed, at the redemption price. If the redemption price is 0.8, the redeemable value = 1000 * 0.8 = 800 USD.

The redeemable value obtained (800 USD) is compared with the Minimum Holdings Amount specified (1200 USD). Since the Minimum Holdings Indicator chosen is ‘Lower of Amount/Units’, the minimum holdings value to be validated against, is 800 USD. Therefore, the redeemable value of total number of units held by all unit holders under a CIF, in the Burton Carey Fund must equal or exceed 800 USD, for an IPO or subscription transaction in respect of a standing instruction involving a CIF.

If the Minimum Holdings Indicator were selected as ‘Higher of Amount/Units’, the higher value (1200 USD) would be considered as the minimum holdings value against which the validation would be made. Therefore, the redeemable value of total number of units held by all unit holders under a CIF, in the Burton Carey Fund would have to equal or exceed 1200 USD, for an IPO or subscription transaction in respect of a standing instruction involving a CIF.

SI Minimum Holdings Apply For

Optional

Select whether the minimum holdings check is applicable for CIFs, or for individual unit holders from the drop-down list. The list displays the following values:

If the check is to apply at CIF level, the redeemable value of the total number of units held by all investors under the CIF in the fund is considered for validation.

Max. Initial Transaction Amount

Numeric; 22 Characters; Optional

Specify the maximum amount permitted for an initial transaction, for an investor in this fund.

Max. Initial Transaction Units

Numeric; 22 Characters; Optional

Specify the maximum number of units permitted for an initial transaction, for an investor in this fund.

SI Minimum Holdings Indicator

Mandatory

Select the basis upon which the minimum holdings check is performed from the drop-down list. The list displays the following values:

If you choose either of the last two options (Lower of Amount/Units or Higher of Amount/Units), you must specify the applicable minimum amount in the Minimum Holdings Amount field as well as the applicable minimum number of units in the Minimum Holdings Units field. Also, in either case, the redeemable value of the total number of units held by all investors under the CIF is considered for validation, if the check is to apply at CIF level.

Amount/Units Limit for Investor Category

The volume ranges of a transaction, for each transaction type, can be limited for each investor category, for a Fund. The limits can be defined in terms of units or amount of the transaction type.

You can set up these limits as part of the Transaction Processing Rules profile for each fund, and, as such, may be set up through that maintenance screen.

When you save your specifications in this screen, it will be closed and you will be returned to the main Transaction Processing Rules screen. When you save the transaction processing rule record for the fund, the specifications you have made in this screen are saved as part of the same record, in the database.

You can also access this screen from the Amount / Units Limits for Investor Category menu of the Fund Manager component. If you have accessed the screen in this manner, the limits defined here will supersede the limits defined in the Transaction Processing Rules profile for the fund and transaction type.

Before you set up an Amount/Units Limits on Investor Categories profile record for a fund, it is desirable to ensure that the following information is already setup in the system:

Details

You can specify the following fields in this screen:

Investor Category

Alphanumeric; 2 Characters; Mandatory

Specify the category of Investor for whom the amount/units limit is to be set up.

Minimum Amount

Numeric; 18 Characters; Mandatory

Specify the minimum amount that an investor who falls under this category can transact in this fund and transaction type.

Step Amount

Numeric; 18 Characters; Optional

Specify the amount, in steps of which an investor who falls under this category can transact in this fund and transaction type.

Maximum Amount

Numeric; 18 Characters; Mandatory

Specify the maximum amount that an investor who falls under this category can transact in this fund and transaction type.

The maximum volume of a single transaction that is entered should never exceed or be equal to the figure of one trillion.

For example, if the user wishes to enter a transaction of 1.5 billion, he will have to consider entering two transactions, neither exceeding a maximum limit of 999999999999.999.

Minimum Units

Numeric; 27 Characters; Mandatory

Specify the minimum number of units that an investor who falls under this category can transact in this fund and transaction type.

Step Units

Numeric; 27 Characters; Optional

Specify the number of units, in steps of which an investor who falls under this category can transact in this fund and transaction type.

Maximum Units

Numeric; 27 Characters; Mandatory

Specify the maximum number of units that an investor who falls under this category can transact in this fund and transaction type.

The maximum volume of a single transaction that is entered should never exceed or be equal to the figure of one billion, in terms of units.

For example, if the user wishes to enter a transaction of 1.5 billion units, he will have to consider entering two transactions, neither exceeding a maximum limit of 999999999.999999 units.

Communication Mode Amount / Units Limits Screen

The volume ranges of an IPO or subscription transaction, for each transaction type, can be limited for each means of purchase or communication mode, for a fund.

To set up these limits, use the Limit for Communication Mode screen. You can access this screen from the Transaction Processing Rules screen for each fund, by clicking on the Max/Min for Communication Mode link in the Transaction Limits section.

When you save your specifications in this screen, it will be closed and you will be returned to the main Transaction Processing Rules screen. When you save the transaction processing rule record for the fund, the specifications you have made in this screen are saved as part of the same record, in the database.

You can also access this screen from the Amount / Units Limits for Communication Mode menu item in the Maintenance menu category of the Fund Manager component. If you have accessed the screen in this manner, the limits defined here will supersede the limits defined in the Transaction Processing Rules profile for the fund and transaction type.

Before you set up these limits for a fund, it is desirable to ensure that the following information is already setup in the system:

Details

You can specify the following fields in this screen:

Communication Mode

Alphanumeric; 2 Character; Mandatory

From the list, select the means of purchase or communication mode for which you are setting up the transaction limits. You can set up the limits for any of the following modes, from the list:

If you have selected ‘Internet’, then the system will not consider transaction cut-off time maintained at transaction processing rules.

Minimum Amount

Numeric; 18 Characters; Mandatory

Specify the minimum amount that an investor who subscribes through the selected means of purchase can transact in this fund, through an IPO or subscription transaction.

Maximum Amount

Numeric; 18 Characters; Mandatory

Specify the maximum amount that an investor who subscribes through the selected means of purchase can transact in this fund, through an IPO or subscription transaction.

The maximum volume of a single transaction that is entered should never exceed or be equal to the figure of one trillion.

For example, if the user wishes to enter a transaction of 1.5 billion, he will have to consider entering two transactions, neither exceeding a maximum limit of 999999999999.999.

Minimum Units

Numeric; 27 Characters; Mandatory

Specify the minimum number of units that an investor who subscribes through the selected means of purchase can transact in this fund, through an IPO or subscription transaction.

Maximum Units

Numeric; 27 Characters; Mandatory

Specify the maximum number of units that an investor who subscribes through the selected means of purchase can transact in this fund, through an IPO or subscription transaction.

The maximum volume of a single transaction that is entered should never exceed or be equal to the figure of one billion, in terms of units.

For example, if the user wishes to enter a transaction of 1.5 billion units, he will have to consider entering two transactions, neither exceeding a maximum limit of 999999999.999999 units.

Disallow First Transaction

Optional

Select ‘Yes’ from drop-down list to ensure that the users transacting in this fund are not allowed to communicate through the selected communication channels.

This option is applicable for the first subscription for the combination unit holder and fund.

Note

3.1.7.5 Pricing Tab

In this section, you can set up the pricing details, such as the basis of price definition, the base price factor, the number of decimals for the price, the price lag and the back dating limits.

 

Back-Dating Allowed?

Mandatory

Select ‘Yes’ in this field to specify that backdating should be allowed for this fund. This means that on any given date, for this transaction type, the system will allow the user to enter transactions dated earlier to the current date.

Back Dating Limit

Numeric; 22 Characters; Mandatory

Enter a value to specify the number of days that one can back date. This is applicable only if Allow Back Dating is True. This has to be later than the transaction start date. Fund Price as effective on that date will be taken into account during allocation.

Rounding Options for Base Price

Mandatory

Select whether the base price value must be rounded off or truncated from the drop-down list, for the selected transaction type, for the fund. The list displays the following values:

Rounding Precision for Base Price

Numeric; 22 Characters; Mandatory

Indicate the maximum number of decimals that would be reckoned for rounding precision, for the transaction base price.

Rounding Options for Unit Price

Optional

Select the rounding options for the value of the unit price for the selected transaction type from the drop-down list. The list displays the following values:

Example

Let us suppose that the unit price computed for a subscription transaction is 10.561234, and that this value must be rounded to the 3rd decimal place.

If you indicate rounding up, then the value reckoned would be 10.562.

If you indicate rounding off, then, applying normal rounding off rules, the value reckoned would be 10.561.

If you indicate rounding down or truncation, then the value would be truncated as it is, in the 3rd decimal place, and it would be reckoned as 10.561.

Rounding Precision for Unit Price

Numeric; 22 Characters; Optional

Indicate the maximum number of decimals that would be reckoned for rounding precision, for the unit price for the selected transaction type.

Rounding Options for Units

Mandatory

Select the rounding options for the computation of the units allotted in respect of a transaction, for the selected transaction type from the drop-down list. The list displays the following values:

The rounding options specified for the fund in the Shares Characteristics profile is displayed here by default, and you can alter this specification if necessary. The rounding option specified in this field will be deemed as the final specification for the fund and transaction type.

Rounding Precision for Units

Numeric; 22 Characters; Optional

Specify the decimal value or negative value for the units and the units would be reckoned for rounding precision.

Base Price Definition

Mandatory

Select the Base Price definition for the transaction, from the drop-down list. The list displays the following values:

The Unit Price will be calculated based on this price and loads defined for this transaction.

Base Price Factor (%)

Numeric; 7 Characters; Mandatory

Enter a value to specify the Percentage of Base Price value that is defined above. This percentage will be applied to the price arrived from the above calculations to arrive at the Base Price for this transaction type for the fund.

Payment Lag Calendar Basis

Mandatory

Select whether the payment lag days should be considered based on the holiday calendar for the fund, the actual calendar, the System calendar or the payment currency calendar from the drop-down list. The list displays the following values:

Payment Lag (Days)

Numeric; 22 Characters; Optional

Specify a value to indicate the number of days by which the settlement for a transaction would be lagged or deferred, after it has been allotted and confirmed.

In the case of redemption transactions, to arrive at the actual date of redemption settlement, both the confirmation lag (if specified) and the payment lag (if specified here) are taken into consideration. For instance, if the redemption transaction was allocated on 15th January and both the confirmation lag and payment lag were specified as 2, then the actual redemption payout to the unit holder would be effected on 19th January (15 + 2+ 2), provided it is not a holiday in the system, and provided there are no intervening holidays.

Price Lag Calendar Basis

Mandatory

Select whether the price lag days should be considered based on the holiday calendar for the fund, the actual calendar or the System calendar from the drop-down list. The list displays the following values:

Price Lag

Numeric; 22 Characters; Mandatory

If you require the price applied for transactions of the selected type in the fund to be the prevalent price as on a date earlier than the transaction date (for cash-based transactions) or the clearing date (for instrument-based transactions), you can specify the number of lag days in this field.

The number of days you specify is considered based on the Price Lag Calendar Basis specified.

For instance, if you specify a price lag of 2, and the lag is based on the fund calendar, and the transaction date for a cash-based transaction is 12th December 2003, the price as of 10th December is used for allocation, provided both 11th and 10th December is working days for the fund. If the lag is based on the actual calendar, the price as of 10th December is used.

Fluctuation (%)

Numeric; 22 Characters; Optional

You can specify the fluctuation allowable in the base price for the transaction type, for the fund. When prices are entered for the transaction type for the fund, for the day, the system validates whether the fluctuation is within the allowable limit specified in this field.

Future Date Limit

Numeric; 22 Characters; Optional

Indicate the number of days (in terms of fund calendar days) up to which the future dating will be allowed. The transaction date should be within the future dating limit.

3.1.7.6 Policies Tab

In this section, you can set up the following information:

 

Policy

Mandatory

Select ‘First In First Out’ or ‘Proportionate’ option from drop-down list to specify the policy for allocation in case the maximum limit is reached for a given day. This policy is with respect to the allocation percentage that is allowed against the fund corpus.

Acknowledgment Note Required?

Mandatory

Select ‘Yes’ from drop-down list to indicate that the Acknowledgment Slip is to be printed after every transaction. Otherwise this can be printed only at the User’s request.

Allocation Lag

Numeric; 22 Characters; Mandatory

Enter a value to specify when the transaction should be allocated if the transaction is ‘T’. T + X, where ‘X’ signifies the number of lag days. Lag can only be positive.

Check On Par with Cash

Mandatory

Select ‘Yes’ from drop-down list to indicate that all cheque / Demand Draft transactions are to be treated on par with cash transactions. If this is true, then during allocation, the cheque / demand draft transactions will be taken for allocation for the same day. The units allocated will be provisional, and will be confirmed only after the cheque is cleared.

Retain Ageing to Subscription?

Mandatory

Select ‘Yes’ from drop-down list to indicate that the aging principle must be applied to subscription transactions in the fund. Aging is the process of keeping track of a transaction from the transaction date right up to when it is cleared in full from the account of the unit holder. Depending upon the policy specified for aging, (i.e., either FIFO or Proportionate), aging is applied.

In case of CDSC funds it is mandatory for you to select ‘Yes’.

Limit Mode

Optional

Select the mode based on which redemption will be limited from the drop-down list. The list displays the following values:

Transfer On Par With Cash

Mandatory

Select ‘Yes’ from drop-down list to indicate that all transfer transactions to be treated on par with cash transactions. If this is true then during allocation the transfer transactions will be taken for allocation for the same day. The units allocated will be provisional, and will be confirmed only after the bank transfers are cleared.

Apply Entry Time Load?

Optional

For exit fee loads applied on outflow transactions such as redemption, switch-out and transfer, you can choose to apply the return values prevalent at the time of initiation of the inflow subscription or IPO transaction being aged, or the return values prevalent at the time of the outflow transaction.

To indicate that the entry load values must be applied, select ‘Yes’ from the drop-down list. To indicate that exit load values must be applied, select ‘No’ in this field.

Pseudo Switch Lag

Numeric; 22 Characters; Optional

Specify the pseudo switch lag.

Notice Period

Numeric; 3 Characters; Optional

Notice period is the number of days which an investor has to inform the Transfer Agent in advance before certain number of days, in case of transaction (Subscription / Redemption / Switch / Transfer/ IPO transaction) in a fund.

A notice period is set at each transaction type level for a fund. The system tracks the transaction breaches if any from the notice period. The person who authorizes the transaction is made aware of the notice period breach.

The following details are captured in the Fund rules - transaction processing rules screen to capture Notice period and the Notice period date basis:

The system raises a warning message for breach in notice period if the transaction date added to the notice period is greater than the dealing date during transaction capture. You can view the overridden warning messages at the time of transaction authorization.

The system internally tracks a transaction level indicator to indicate the breach in notice period. The criteria based flat percentage or amount based load can be setup for transactions which breached the notice period based on this indicator.

Note

There is no change in deriving dealing date logic. The system will not re-validate the trans­action for any changes in the holiday calendar post transaction save.

Confirmation Lag

Numeric; 22 Characters; Mandatory

Enter a value to specify when the redemption transaction should be picked for confirmation after allocation. T + X, where ‘X’ signifies the number of lag days. Lag can only be positive.

The confirmation lag can be defined to be applicable to both AMC as well as Distributor installations.

Full Outflow

Mandatory

Select ‘Yes’ from drop-down list to allow full outflow of a fund. Else select ‘No’.

If this option is checked for a redemption transaction, then partial redemption will not be allowed for the fund.

Note

If this checked then the maturity date of a fund will not be displayed and the transaction mode will be defaulted as “Percent” and transaction value as “100” in the redemption screen.

Min Maturity Period (Days)

Numeric; 4 Characters; Optional

Specify the minimum maturity period of the fund here. During subscription transaction, maturity date will be defaulted as the sum of the application date and the minimum maturity period specified here.

Transaction Threshold Amount

Numeric; 30 Characters; Optional

Specify a threshold amount for redemption type transaction. On saving a redemption transaction, the system will display a warning message if the transaction amount (in fund base currency) is greater than the maintained threshold amount.

In case of unit based transaction, units applied and latest available NAV will be used to derive the basis value for comparison. The system will use the par value if latest NAV is not available. Similarly, for multi-currency transaction, to derive the basis value for comparison, the transaction base currency is converted to fund base currency based on the transaction exchange rate. If transaction’s exchange rate is not available, then the system will use the latest available exchange rate (as per project allocation logic). The system will not validate the transaction value with maintained threshold amount if the exchange rate is not available.

Online Allocation?

Mandatory

Select ‘Yes’ from drop-down list to indicate that Online Allocation is to be allowed for the given transaction type. This can be enabled only if the fund is pre-priced.

For Post Priced Fund with Allocation as Online, the Transaction Frequency is Allocation.

Allocation Percentage Versus Registered Capital

Numeric; 20 Characters; Optional

Specify the percentage up to which allocation can be allowed for a given registered capital on a given day, for the selected transaction type.

Confirmation Note Required?

Mandatory

Select ‘Yes’ from drop-down list to indicate that the Confirmation Slip is to be printed after every transaction. Otherwise this can be user initiated after allocation of the transaction.

Cross Branching Allowed?

Mandatory

Select ‘Yes’ from drop-down list to indicate that the transactions of the selected type can be entered from a different branch.

Credit Card On Par With Cash?

Mandatory

Select ‘Yes’ from drop-down list to indicate that all credit card transactions to be treated on par with cash transactions. If this is true then during allocation the credit card transactions will be taken for allocation for the same day. The units allocated will be provisional, and will be confirmed only after the credit card transaction is cleared.

Carry Forward?

Optional

Select the manner in which the balance over redeemed quantity to be treated from the drop-down list. The list displays the following values:

Allocation Lag Calendar Basis

Mandatory

Select whether the allocation lag days should be considered based on the holiday calendar for the fund, the System calendar or the actual calendar. Select one of the options from the drop-down list:

Pseudo Switch Calendar Basis

Optional

Select the pseudo switch calendar basis option from the drop-down list. The list displays the following values:

Notice Period Date Basis

Optional

Select the notice period date basis option from the drop-down list. The list displays the following values:

Link to Unsettled Trades?

Mandatory

Select the option ‘Yes’ from the drop-down list to indicate redemption transactions can be linked to unsettled inflow transactions. Select the option ‘NO’ to indicate redemption transactions can be linked to settled inflow transactions only.

Note

This field, by default, will be set to ‘NO’.

If entry time loads are being applied as specified here, and the loads are overridden at the time of transaction entry, the overridden load values are applied.

Similarly, if entry time loads are being applied, and a unit holder deal has been specified for the unit holder, the deal values are applied.

Note

This feature is only available if your installation has specifically requested for it.

Max Maturity Period (Days)

Numeric; 4 Characters; Optional

Specify the maximum maturity period applicable for the fund.

Note

Once the maturity date is reached, automatic redemption of the fund will take place as a BOD activity provided there is no judicial block (partial or full) on the subscription.

3.1.7.7 SI Specific Info Tab

In this section, you can maintain the rules for standing instruction generation that are to be applicable for the fund.

You can maintain the following rules:

For instance, if SI start date is 28th of every month, assuming, post maintaining the SI transactions 28th, 29th and 30th of that month has been marked as holiday. If the holiday rule is set as After, then the system will generate SI for that month on the next available Business day. There will not be any change in regular transaction of that month, i.e. the system will generate another transaction on 28th again.

The system will increment the successful debit counter on the date when clearing happens

Example

Assume SI Start date is 28th Mar 2017 and if the holiday rule is set as ‘Next’. Holiday is marked for 28th, 29th, 30th and 31st of March. In such cases, the system will generate SI on 03-Apr-2017. The next processing date will be on 28-Apr-2017

If the holiday rule is set as Prior, then the system will generate SI for that month on the previous available Business day.

 

Note

You can specify the following details:

Holiday Rule

Optional

Select holiday rule from the drop-down list. The list displays the following values:

Specific Gen.Day

Alphanumeric; 3 Characters; Optional

Specify the specific generation day.

Default SI Frequency

Optional

Select default SI frequency from the drop-down list. The list displays the following values:

SI Cut-Off Day

Numeric; 22 Characters; Optional

Specify the SI cut-off day.

Enforce Generation

Optional

Select ‘Yes’ from drop-down list to enforce generation.

Max No. of SI Txns

Numeric; 22 Characters; Optional

Specify the maximum number of SI transactions.

SI Lead Time

Numeric; 22 Characters; Optional

Specify SI lead time.

SI Auto-Termination Cumulative Counter

Numeric; 22 Characters; Optional

Specify the SI auto termination cumulative counter.

Default SI Description

Alphanumeric; 255 Characters; Optional

Specify the default SI description.

Calendar Basis

Optional

Select the calendar basis from the drop-down list. The list displays the following values:

SI Generation Freq.

Optional

Select SI generation frequency from the drop-down list. The list displays the following values:

SI Cut-off Lag

Numeric; 22 Characters; Optional

Specify the SI cut-off lag details.

Max. Validity(Days)

Numeric; 22 Characters; Optional

Specify the maximum validity in days.

Inflow Overridable Msg

Optional

Select ‘Yes’ from drop-down list to inflow overridable message.

Last Working Day

Optional

Check this box to indicate the last working day.

SI Auto-Termination Consecutive Counter

Numeric; 22 Characters; Optional

Specify SI Auto-Termination Consecutive Counter details.

3.1.7.8 SI Rules for Frequency Tab

You can maintain the rules for standing instructions generation, for a fund-investment account type and transaction type combination, in the SI Specific Information Tab. To invoke this screen, click on the SI Specific Information link in the Fund Demographics screen.

 

This information is optional and can be captured for IPO, Subscription, Redemption, Switch and Transfer transaction types.

For each combination, you can maintain the holiday rule and the calendar basis that is to be used. To view the transaction type level rules that have been defined in the Transaction Processing Rules for the fund, click SI Details button.

Details

In this section, you can maintain the rules for standing instruction generation that are to be applicable for the fund.

You can maintain the following rules:

Frequency

Mandatory

Select the frequency for standing instruction generation from the drop-down list. The list displays the following values:

SI Minimum Amount

Numeric; 18 Characters; Optional

Specify the SI minimum amount.

SI Maximum Amount

Numeric; 18 Characters; Optional

Specify the SI maximum amount.

SI Minimum Units

Numeric; 18 Characters; Optional

Specify the SI minimum units.

SI Maximum Units

Numeric; 27 Characters; Optional

Specify the SI maximum units.

Frequency ID

Alphanumeric; 10 Characters; Mandatory

Specify the frequency ID.

SI Minimum Holdings Amount

Numeric; 18 Characters; Optional

Specify SI minimum holdings amount.

SI Minimum Holdings Units

Numeric; 18 Characters; Optional

Specify SI minimum holdings units.

SI Minimum Holdings Apply For

Optional

Select SI minimum holdings apply for option from the drop-down list. The list displays the following values:

SI Minimum Holdings Indicator

Mandatory

Select SI minimum holdings indicator from drop-down list. The list displays the following values:

Min No of SI

Numeric; 5 Characters; Optional

Specify the minimum number of SI.

No. Of Consecutive Failures

Numeric; 2 Characters; Optional

Specify the number of consecutive failures.

Holiday Rule

Optional

Select the holiday rule to be applied from the drop-down list. The list displays the following values:

SI Auto-Termination Counter

Numeric; 2 Characters; Optional

Specify the SI auto termination counter.

3.1.7.9 Processing and Validating Transaction Processing Rules

The system will validate the transaction limit against each fund price currency and transaction type during transaction capture only if there is limit maintenance in the transaction processing rules table in the ‘Fund Price Currencies’ tab.

If Transaction Base Currency (TBC) = FBC and limits are maintained for both fund base currency and fund price currency, then the system will validate transaction amount against the fund base currency limit maintained at the fund rules (TPR).

If Transaction Base Currency = fund price currencies, and Min/Max amount Limits in FPC’s are maintained; then system will validate the transaction amount against the Amount Limits maintained for the transaction type in fund price currency.

In case the transaction base currency is neither FBC nor FPC, system will validate the transaction amount against the FBC limits maintained for the transaction type in TPR by using the latest exchange rate to convert the amount in FBC. In this case only FBC limits are maintained.

If the upload transaction currency is FPC, the system will validate the amount limit maintained for Fund price currencies.

The fields Minimum Units, Maximum Units and Step Units for FPC is irrelevant in case of unit based transactions because the unit applied in case of unit based transactions is in FBC.

If you create fund with Currency of Expression fund’ as Yes and capture a transaction with currency of expression transaction field value as yes at transaction level and authorize the same; and before the allocation if you amend the fund and delete one of the price currency maintained or delete all the fund price currencies maintained; then you will have to manually reverse these transaction captured due to change/deletion in fund price currencies at fund level and post new transactions. Allocation will fail for such transactions where there is mismatch due to the change /deletion of fund price currencies at fund level.

The system will perform pre-EOD check to validate any un-allotted transactions (due to the change /deletion of fund price currencies at fund level. Pre-eod will display the list of impacted transactions i.e. Transaction number, Fund ID and Transaction currency.

If currency of expression fund is made as non currency of expression fund and if you inputs a back dated /future dated transactions, then system will always look at the rule effective for the fund.

In case of redemption transactions, the system will validate the fund account in transaction currency if the transaction base currency is one of the fund price currencies.

3.1.7.10 Pre EOD Check

The system will perform the Pre EOD check to check whether price in fund price currencies have been maintained for the day in the system. System will behave in the similar fashion as it happens in case of no price in FBC. In case the system does not find the Price in currency of expression, the transaction entered in currency of expression will not be allotted. The system will list the fund ID and the currencies for which the prices have not been entered.

The system will validate any un-allotted transactions due to the change /deletion of fund price currencies at fund level. This Pre-EOD will display the list of impacted transactions with Transaction number, Fund ID and Transaction currency details.

3.1.8 Fund Restriction Button

To set up a fund restriction, use ‘Fund Restriction’ screen. You can invoke this screen by clicking ‘Fund Restriction’ button in ‘Fund Rule Details’ screen.

 

You can specify the following details:

Fund ID

Display

The system displays the fund ID.

Rule Effective Date

Display

The system displays the rule effective date.

3.1.8.1 Fund Sale Country Restriction Tab

This fund rule facilitates the maintenance of restrictions in respect of the fund being allowed for sale or operations in certain countries. You can maintain a list of countries as the only countries where the fund is allowed for sale.

To set up the country of sale restrictions for a fund, use the Fund Sale Country Restriction screen. You can invoke this screen by clicking the ‘Fund Sale Country Restriction’ Tab in ‘Fund Restriction’ screen.

Checks

Before you set up a Fund Sale Country Restriction profile record for a fund, it is desirable to ensure that the following information is already setup in the system:

Country Code

Alphanumeric; 3 Characters; Mandatory

Specify the country code. The adjoining option list displays all valid accounts maintained in the system. You can choose the appropriate one.

3.1.8.2 Fund Residency Restriction Tab

This fund rule facilitates the maintenance of restrictions in respect of the nationalities of unit holders who must not be allowed to transact in the fund. You can maintain a list of countries that must not be excluded from operating in the fund, and all unit holders whose country of domicile is found in this list will be allowed to subscribe into the fund.

To set up the nationality restrictions for a fund, use the Fund Residency Restriction screen. You can invoke this screen by clicking the ‘Fund Residency Restriction’ Tab in ‘Fund Restriction’ screen.

Checks

Before you set up a Fund Residency Restriction profile record for a fund, it is desirable to ensure that the following information is already setup in the system:

 

Country Code

Alphanumeric; 3 Characters; Mandatory

Specify the country code. The adjoining option list displays all valid accounts maintained in the system. You can choose the appropriate one

3.1.8.3 Inflow Restriction Tab

In this tab you can specify the inflow restriction details.

 

Restricted Fund

Optional

Select if transaction type or ref types should be allowed or not from the adjoining drop-down list. Following are the options available:

Ref Types

Optional

Select if ref type is allowed or not.

If you have selected ‘Restricted Fund’ field as ‘Yes’, then you should choose the allowed/ disallowed option and provide restriction list.

If you have selected ‘Allowed’ option, then on transaction posting, the system will display warning message for the transaction/ reftypes, which are not part of the restriction list.

If you have selected ‘Disallowed’ option, then on transaction posting, the system will display warning message for the transaction/ reftypes, which are part of the restriction list.

If you have selected ‘Restricted Fund’ field as ‘No’, then the system will validate that no transaction should be provided in the restriction list.

Ref Type for Share Class Restriction

Transaction Type

Alphanumeric; 2 Characters; Optional

Specify the transaction type. The adjoining option list displays all valid transaction type maintained in the system. You can choose the appropriate one.

For switch / transfer transaction, the system will display the warning message if the Restricted fund field is enabled for the To fund.

Ref Type

Alphanumeric; 2 Characters; Optional

Specify the ref type. The adjoining option list displays all valid ref type maintained in the system. You can choose the appropriate one.

Ref Type Description

Display

The system displays the description for the selected Ref type.

In case of fund transaction suspension, RSP will continue to generate transaction. This can be achieved by maintaining Fund Restriction in Fund Rule Maintenance (UTDFNDRL) by only allowing transaction type ‘02’ and ref type ‘41’ (RSP).

In case of fund transaction suspension, DRSP will continue to generate transaction. This can be achieved by maintaining Fund Restriction in Fund Rule Maintenance (UTDFNDRL) by only allowing transaction type ‘02’ and ref type ‘45’ (DRSP).

3.1.9 Fund Transaction Currencies Button

This fund rule facilitates the maintenance of restrictions in respect of the currencies that may be used in a transaction. You can maintain a list of currencies that will be exclusively allowed as valid transaction currencies, and all other currencies will not be accepted in the process of the transaction.

To set up the transaction currency restrictions for a fund, use the Fund Transaction Currency Restriction screen. You can invoke this screen by clicking the Fund Transaction Currencies link from the Fund Rules screen.

 

Before you set up a Fund Transaction Currency Restriction profile record for a fund, it is desirable to ensure that the following information is already setup in the system:

You can specify the following fields in this screen:

Fund ID

Display

This field indicates the ID fund for which you are setting up the Fund Transaction Currency Restriction profile. This information is defaulted from the Fund Demographics screen.

Rule Effective Date

Display

The Rule Effective Date for the fund, which you specified in the Fund Demographics screen, is displayed here.

Currency Code

Alphanumeric; 3 Characters; Optional

Choose only the currencies that you wish to allow for transactions in the fund from the option list. When you do not choose any currency, all the currencies are allowed for the fund

3.1.10 Corporate Actions Button

This fund rule facilitates the definition of the guidelines that will govern the distribution of income derived from the fund by the unit holders that subscribe to the fund. You can define the framework according to which corporate actions such as dividend declaration and processing must be performed for a fund. Through this screen the system can also process multiple distributions of a fund on the same day and process the distribution on the same day.

To set up the Corporate Action rules for a fund, use the Corporate Actions screen. You can invoke this screen by clicking ‘Corporate Actions’ button from the Fund Rules screen.

Note

This screen cannot be used to maintain parameters for corporate actions such as liquida­tion, split, reverse split and merger. To maintain these, you must use the Corporate Ac­tions Maintenance screen, which you may invoke by clicking on Corporate Actions in the Maintenance menu, and Detail under it.

For more information on these corporate actions and the Corporate Actions Maintenance screen, refer the chapter Other Fund Activities in this user manual.

Note

Before you set up a Corporate Actions profile record for a fund, it is desirable to ensure that the fund already has an existing, unauthorized profile record.

You can specify the following details in this screen:

Fund ID

Display

This field indicates the ID fund for which you are setting up the Corporate Actions profile. This information is defaulted from the Fund Demographics screen.

Rule Effective Date

Display

The Rule Effective Date for the fund, which you specified in the Fund Demographics screen, is displayed here.

Corporate Action Type

Alphanumeric; 1 Character; Optional

Select the type of corporate action for which this rule is being set up. It could be either a cash dividend or a stock dividend. It could be either a cash dividend for income, or capital gains earnings.

For stock dividends, the following information is accepted by default:

Dividend Declaration Frequency

Mandatory

Select the frequency with which the dividend is to be declared from the drop-down list. The list displays the following values:

Default Distribution Mode

Mandatory

If the Income Distribution Setup for the unit holder has not yet been specified, the fund level default Unit Holder Distribution Mode to be considered for the unit holder can be specified here. Any one of the options from the drop-down list may be chosen. The following values may be entered:

If the rules are being setup for a share class fund for which reinvestment is mandatory, then this field is defaulted to Full Reinvestment and locked for data entry.

For stock dividends, the option ‘Full Reinvestment’ is selected here by default, and cannot be changed.

Dividend Payment Frequency

Mandatory

Select the frequency with which the declared dividends are to be paid from the drop-down list. The list displays the following values:

As the system supports accumulation of dividends, the payment could be for any dividend that has been declared earlier.

The Dividend Payment Frequency must not be less than Dividend Declaration Frequency.

Tax ID

Alphanumeric; 15 Characters; Optional

Enter the tax ID for the fund that is being set up.

Rounding Option

Mandatory

Select the rounding options for the value of the dividend, designated for the fund from the drop-down list. The list displays the following values:

Example

Let us suppose that the dividend earned by an investor, Mrs. Laurie Klein, in the ABC Growth Fund is 700.679263 currency units, and that this value must be rounded to the 3rd decimal place.

If you indicate rounding up, then the value reckoned would be 700.680.

If you indicate rounding off, then, applying normal rounding off rules, the value reckoned would be 700.679.

If you indicate rounding down or truncation, then the value would be truncated as it is, in the 3rd decimal place, and it would be reckoned as 700.679.

Rounding Precision

Numeric; 5 Characters; Mandatory

Indicate the maximum number of decimals that would be reckoned for rounding precision, for the dividend. You cannot indicate a precision higher than 6 decimal places.

Dividend Exchange Rate Basis

Mandatory

Select the basis upon which the exchange rate will be applied for dividend processing from the drop-down list. The list displays the following values:

TDS Basis

Mandatory

This is to indicate whether slab should be looked for every dividend payment separately or whether consolidated on a fiscal year basis. Choose one of the options from the drop-down list. The list displays the following values:

For stock dividends, the option “Tax –Exempt” is selected here by default, and cannot be changed.

EPU LOT

Numeric; 6 Characters; Mandatory if EPU is applicable

Specify the number of units for which the EPU quote is deemed to be applicable, for the fund.

Setting up EPU components is not applicable for stock dividends.

Distribution Mode For Minimum Balance

Mandatory

Indicate how the income derived from the fund is to be distributed, in respect of unit holders whose holdings balance falls below the minimum holdings specified for the fund.

Select the mode of distribution for minimum balance from the drop-down list. The list displays the following values:

Units For Freeze Holding

Mandatory

Select the units for freeze holding from the drop-down list. The list displays the following values:

Preferences

EPU Based on Components?

Mandatory

Select ‘Yes’ from drop-down list if EPU is based on components. Else select ‘No’.

Restrict IDS for Unit Holder

Mandatory

Select ‘Yes’ from drop-down list to indicate that specific income distribution setups for unit holders may be overridden.

Special Dividend

Mandatory

Select ‘Yes’ from drop-down list to indicate that special dividends are applicable for the fund. This feature is only available if your installation has requested for it.

Holiday Rule

Mandatory

Select the rule to be applied if the dividend processing date falls on a holiday. You can select either the PRIOR rule (the previous working day is considered) or the AFTER rule (the next working day is considered), for the dividend type from the drop-down list.

The holiday rule you select here will be applicable to all dividend-processing dates that have been arrived at using a frequency. They are not applicable to dates arrived at using lead times or lag periods.

Reinvestment Lag

Numeric; 22 Characters; Optional

Specify the reinvestment lag as the number of days to enable reinvestment on a different date or the same day as the payment date. The default value is 0. If the value is considered as 0, then the reinvestment is made on the same day as the payment date. For a value other than 0, the system calculates the reinvestment date from the payment date. For example: If the number of days entered is 10 and the payment date is 30th June, then the reinvestment date will be 10th July.

Payment Lag (Days)

Numeric; 3 Characters; Mandatory

Specify a lag period (in days) for the payment of dividend. The lag value is interpreted in calendar days, and is used to arrive at the payment date for the dividend. The payment date is arrived at as follows:

Dividend Payment Date = Dividend Declaration Date + Payment Lag

Reinvestment Price Basis

Numeric; 10 Characters; Mandatory only if default distribution mode is ‘Reinvestment’.

Reinvestment transactions into the fund can be put through either at the NAV for the day or the transaction base price. You can use this field to indicate the price that must be used.

Default EPU to Previous Declared EPU?

Optional

Specify whether the previous day’s Earning Per Unit (EPU) needs to be defaulted during the generation of a dividend record. You can select either ‘Yes’ or ‘No’ from the drop-down list.

If you select the option ‘Yes’, the system will default the previous day’s EPU while generating the dividend record at the Beginning of Day (BOD). This record will be an authorized record. However, you will be able to modify it. If the previous day’s EPU is zero, the system will still default the value and generate an authorized record. You can enter the EPU value for this record.

This field is available only for Money Market funds. Also, if ‘Dividend Declaration Frequency’ and ‘Dividend Payment Frequency’ are the same, this field will be disabled.

Action on Minimum Amount Validation

Optional

Select the options from drop-down list. The list displays the following values:

Auto Reinvestment for Unclaimed Dividend

Optional

If you select ‘Yes’ from drop-down list, system will automatically reinvest when dividend is unclaimed, i.e., dividend check is not encashed within the expiry date.

Note

By default, this option will be ‘No’.

Track Dividend for Uncleared Transactions?

Optional

Indicate whether dividend payment/re-investment should be tracked for an individual un-cleared transaction.

If you select ‘Yes’ from drop-down list, dividend will be held back temporarily for subscription transactions whose cheques are not cleared as on the Dividend Declaration Date. Dividend will be released when the payment is cleared.

Note

By default, this option will be ‘No’.

Pay Ungenerated Reinvestments?

Optional

Select ‘Yes’ from drop-down list to indicate that in case the re investment results in zero units allotment, the amount should be paid out to the investor.

If you select ‘Yes’, then system executes the following steps:

If the number of units in the result of step 3 is greater than zero, re-investment transaction will be generated. If the result is zero then the amount should be paid out to the investor in the unit holder preferred currency. In case any specific preference has been set at the unitholder fund level then the respective currency will be used.

Reinvestment Allowed?

Mandatory

Select ‘Yes’ from the drop-down list to indicate that reinvestment is allowed for the fund. If the rules are being setup for a share class fund for which reinvestment is mandatory, then this field has a default ‘Yes’ and locked for data entry.

Look Ahead Processing?

Mandatory

Select ‘Yes’ from the drop-down list to indicate that in the event of intervening holidays, the system would obtain the EPU information and process dividends for the holiday period, ahead of the prior business day, for the fund.

First Dividend Declare Date

Date Format; Optional

Specify the first date for dividend declaration, for the fund. The system considers the first dividend date in arriving at the date for dividend processing, as follows:

First dividend processing = First Dividend Declare Date – Dividend Declaration Frequency + Dividend Payment Frequency.

The system also uses the first dividend declare date to arrive at the next dividend declare date, applying the specified declaration frequency.

If you do not specify the first dividend declare date, the fiscal year specified for the fund is used to determine the next dividend declare date.

Mock Dividend?

Mandatory

Select ‘Yes’ from drop-down list to indicate the applicability of mock dividends for the fund. This feature is only available if your installation has requested for it.

Pay Dividends During Redemption?

Mandatory

Select this option to indicate that dividends may be paid during redemption from the drop-down list. The list displays the following values:

Compulsory Reinvestment for Retirement Account?

Mandatory

You can use this field to indicate that dividend due from the fund on an IRA account must be compulsorily reinvested. Select ‘Yes’ from drop-down list to indicate compulsory reinvestment.

Interest to be compounded for the payment Period?

Optional

Indicate whether the dividend interest needs to be compounded for the entire payment period or not. You can select either ‘Yes’ or ‘No’ from the drop-down list.

If you select ‘Yes’, the system will calculate the dividend on the amount instead of multiplying the units by the EPU. The EPU value maintained as ‘As amount’ will be directly used in the dividend calculations.

This field is available only for Money Market funds. Also, if ‘Dividend Declaration Frequency’ and ‘Dividend Payment Frequency’ are the same, this field will be disabled.

Example

Assume that the EPU is 0.001267. This value will be directly used during dividend processing to calculate the payment amount.

Consider the following case listing the transactions from Jan 1, 2005 to Jan 31, 2005:

Open Bal

InTxns (Bal. sum)

Freeze holding balance

Div calc base

EPU

Div Units

NAV

Div amt

Div Sum from the 1st till date(Units)

Div Sum from the 1st of the Month till date (Amount)

100000

0

100000

100000.0000

0.000136986

15.07

25.00

376.71

15.07

376.71

100000

0

100000

100015.0685

0.000136986

15.07

25.00

376.75

30.14

753.46

100000

0

100000

100030.1385

0.000136986

15.07

25.00

376.75

45.21

1130.21

100000

0

100000

100045.2085

0.000136986

15.07

25.00

376.75

60.28

1506.96

100000

0

100000

100060.2785

0.000136986

15.07

25.00

376.75

75.35

1883.71

100000

0

100000

100075.3485

0.000136986

15.07

25.00

376.75

90.42

2260.46

100000

0

100000

100090.4185

0.000136986

15.08

25.00

377.00

105.50

2637.46

100000

0

100000

100105.4985

0.000136986

15.08

25.00

377.00

120.58

3014.46

100000

0

100000

100120.5785

0.000136986

15.08

25.00

377.00

135.66

3391.46

100000

0

100000

100135.6585

0.000136986

15.08

25.00

377.00

150.74

3768.46

100000

0

100000

100150.7385

0.000136986

15.09

25.00

377.25

165.83

4145.71

100000

0

100000

100165.8285

0.000136986

15.09

25.00

377.25

180.92

4522.96

100000

0

100000

100180.9185

0.000136986

15.09

25.00

377.25

196.01

4900.21

100000

0

100000

100196.0085

0.000136986

15.09

25.00

377.25

211.10

5277.46

100000

5000

105000

105211.0985

0.000136986

15.85

25.00

396.25

226.95

5673.71

105000

0

105000

105226.9485

0.000136986

15.85

25.00

396.25

242.80

6069.96

105000

0

105000

105242.7985

0.000136986

15.85

25.00

396.25

258.65

6466.21

105000

0

105000

105258.6485

0.000136986

15.86

25.00

396.50

274.51

6862.71

105000

0

105000

105274.5085

0.000136986

15.86

25.00

396.50

290.37

7259.21

105000

0

105000

105290.3685

0.000136986

15.86

25.00

396.50

306.23

7655.71

105000

0

105000

105306.2285

0.000136986

15.86

25.00

396.50

322.09

8052.21

105000

0

105000

105322.0885

0.000136986

15.87

25.00

396.75

337.96

8448.96

105000

0

105000

105337.9585

0.000136986

15.87

25.00

396.75

353.83

8845.71

105000

0

105000

105353.8285

0.000136986

15.87

25.00

396.75

369.70

9242.46

105000

0

105000

105385.5685

0.000136986

15.87

25.00

396.75

385.57

9639.21

105000

0

105000

105385.5685

0.000136986

15.88

25.00

397.00

401.45

10036.21

105000

0

105000

105401.4485

0.000136986

15.88

25.00

397.00

417.33

10433.21

105000

0

105000

105417.3285

0.000136986

15.88

25.00

397.00

433.21

10830.21

105000

0

105000

105433.2085

0.000136986

15.88

25.00

397.00

449.09

11227.21

105000

0

105000

105449.0885

0.000136986

15.88

25.00

397.00

464.97

11624.21

105000

0

105000

105464.9685

0.000150685

15.89

25.00

397.25

480.86

12021.46

 

 

 

 

Total Divi­dend

 

 

12021.46

 

 

During payment processing at the end of the month (in case the payment frequency is monthly), the EPU entered at the end of the month will be used for all calculations for the payment period. In case the EPU entered at the end of the month is different, then the new EPU will be used to calculate the dividend amount payable for all days in the payment period.

In case the payment date happens to be a holiday, defined in the system calendar, the system will process the dividend on the day preceding the holiday (if the holiday rule is set to ‘prior’).

Minimum Amount for Payment

Numeric; 30 Characters; Optional

Indicate the threshold dividend amount in fund base currency. If Investor has chosen the cash option for dividend payment and the dividend income in the current processing cycle is more than threshold dividend amount, then dividend income can be paid out.

If Unit holder has chosen distribution mode as a combination of cash and reinvestment and the cash portion of dividend amount net of tax is less than Minimum Amount for Payment then system will generate a single reinvestment transaction for the total dividend income.

Override at Pay Time

Optional

Select ‘Yes’ option from drop-down list to indicate Minimum Amount for Payment can be overridden during dividend payment processing.

Auto Reinvestment for Unclaimed Dividend When No Balance Left

Optional

If you select ‘Yes’, then system will automatically reinvest when dividend is unclaimed, i.e., dividend check is not encashed within the expiry date and when the unit holder does not have sufficient balance in the underlying fund.

Note

By default, this option will be ‘No’.

Track Dividend for Blocked Transactions?

Optional

Specify whether dividend payment should be tracked for a blocked transaction, where some or all units are blocked at the time of dividend processing.

If you select ‘Yes’ from drop-down list, system will process the dividend as per the action selected in the Block Transaction Screen.

Note

By default, this option will be ’No’.

TDS Applicable for all UH

Optional

You can enter a value in this field only if you have selected the ‘Dividend Equalization Applicable’ option in the General Operating Rules for the fund. The default value is ‘No’; if you select ‘Yes’ from drop-down list, the system will distribute dividend after deducting the tax applicable for all unit holders who are entitled to dividend. This is applicable even for the equalization amount.

Minimum Amount for Reinvestment

Numeric; 30 Characters; Optional

Specify the minimum amount for reinvestment.

FDAP Income

Optional

Select ‘Yes’ from drop-down list to indicate the dividends distributed in this fund are FDAP income.

Note

Lead Times

Book Closing

Numeric; 5 Characters; Optional

Enter a lead-time in days. The Registrar must enter the book closing dates within this lead-time from the time the dividend information is declared.

The Book Closing From and To Dates together signify the period within which no change will be allowed to a unit holder’s balances in a fund. This means that any transaction that has been entered within these dates will not be allocated for the unit holder.

Freeze Holding

Numeric; 5 Characters; Optional

Enter a lead-time in days. The Registrar must enter the Freeze Holdings Date within this lead-time from the time the dividend information is declared.

The Freeze Holding Date is the date on which the balances held by all unit holders in the fund will be consolidated.

You can specify any of the following options:

Note

If the fund is a dividend equalization fund, i.e. if you have checked the ‘Dividend Equaliza­tion Applicable’ option in the General Operating Rules for the fund, you can maintain only the following options here:

If units for freeze holding is based on transaction/dealing date then all the transactions backdated to the previous dividend cycle would be treated as old units (G1 units). If units for freeze holding is based on allocation date then all the transactions backdated to the previous dividend cycle would be treated as new units (G2 units).

Example

Consider two dividend cycles - the first from January 01, 2010 to January 31, 2010 and the second from February 01, 2010’ to ‘February 28, 2010. A subscription transaction (S1) is captured on application date, February 15, 2010, with transaction date as January 15, 2010 and allocation date as February 16, 2010. For the second dividend, units allotted in this transaction would be treated as G1 units (if the units for freeze holding is based on transaction/dealing date) or G2 units (if the units for freeze holding is based on allocation date).

Board Meeting

Numeric; 5 Characters; Optional

Enter a lead-time in days. The Registrar must enter the Board Meeting Date within this lead-time, before the time the dividend information is declared. This is captured for information purposes only.

Dividend Payment

Numeric; 5 Characters; Optional

Enter a lead-time in days. The Registrar must enter the Dividend Payment Date within this lead-time, from the time the dividend information is declared.

Each of the lead times must be less than the Dividend Declaration Frequency. For example, if the Dividend Declaration Frequency is WEEKLY, the Board Meeting Lead Time cannot be 8 days.

NPI Preferences

NPI Applicable

Mandatory

Select ‘Yes’ from drop-down list to indicate that non permissible income (NPI) component is allowed for this fund.

NPI Payment

Alphanumeric; 3 Characters; Optional

If NPI is applicable for this fund, then specify the default payment option from the drop-down list provided.

Override Unitholder Preference?

Mandatory if NPI is applicable

Select ‘Yes’ from drop-down list if the fund override the NPI payment preferences maintained for the investor at the unit holder level. However, if the NPI payment preferences are not maintained at the unitholder level, then NPI payment will be made as per the fund preferences.

Force Reinvestment of Uncleared units

Numeric; 1 Character; Mandatory if NPI is applicable

The system does not consider NPI amount while processing reinvestments, even if it is from un-cleared balances. It should either be paid to a trust or to the unit holder.

However, in case of Permissible income, you can opt to reinvest the Un-cleared Unit balances by choosing the ‘Force reinvestment’ option. Else, select ‘No preference’, which overrides the UH IDS setup.

Multiple Distribution

Net/Gross

Optional

Select Net or Gross from the drop-down list.

Multiple Distribution

Optional

Select if different types of distributions can be processed on the same day or not from the adjoining drop-down list. Following are the options available:

Multiple Distribution

Distribution Type

Alphanumeric; 3 Characters; Mandatory (if multiple distribution box is checked.)

This field is enabled if the Multiple Distribution is selected as ‘Yes’ box is selected. Select the appropriate value from the drop-down list. The options available are INT (Interest), DIV (dividend), and PID (Property Income Distribution). This distribution is applicable for corporate action type ‘Cash’ only.

Distribution Value

Display

The system displays the description for the selected distribution type.

3.1.10.1 Dividend Processing for Fund

In Oracle FLEXCUBE Investor Servicing, there are two types of dividend that can be processed for a fund:

In the case of cash dividends, the unit holders receive the dividend in monetary form. If an income distribution setup record is defined for an investor, then the dividend received is reinvested according to the framework of the same. Cash dividends could be declared for capital gains or income.

In the case of stock dividends, the unit holders receive dividend in the form of units in addition to their holdings as on the record date, which are reinvested in the same fund.

In Oracle FLEXCUBE Investor Servicing, you can define an individual corporate actions record for each of the dividend types, in the Corporate Actions screen. For a fund, if both cash and stock dividends are declared, a separate Corporate Actions profile must be set up for each of the dividend types.

Refer the chapter Dividend Maintenance in the Fund Manager User Manual for information

about the static maintenance for processing dividends in the system.

Setting up Rules for Cash Dividend for Fund

To set up the guidelines for a cash dividend for a fund in the Corporate Actions screen,

  1. The ID of the fund and the Rule Effective Date are filled in from the Fund Demographics screen.
  2. In the Corporate Action type field, select “Cash Dividend”. If you are defining a cash dividend for capital gains, choose Cash Dividend – Capital Gains. For a cash dividend for income, choose Cash Dividend – Income.
  3. Specify the frequencies for declaration and payment of dividend, in the Dividend Declaration Frequency and Dividend Payment Frequency fields respectively.
  4. Specify the rounding rules for dividend, in the Rounding Options and Rounding Precision fields.
  5. Specify the default mode of distribution for the cash dividend – payment by cheque, transfer or reinvestment.
  6. Specify the basis upon which exchange rate for dividend will be obtained, in the Dividend Exchange Rate Basis field.
  7. Specify the first dividend declaration date for the fund, in the First Dividend Declare Date field.
  8. Specify the tax ID for the fund, as well as the basis for tax deduction at source, in the TDS Basis field.
  9. Specify the units to be considered for the record date (freeze holdings) for dividend eligibility, in the Units for Freeze Holding field.
  10. If EPU components are applicable for the fund, select the Allow EPU Component Setup option and specify the EPU Lot. The default value for EPU lot will be 1.
  11. If look-ahead dividend processing for holidays is to be applicable for cash dividends for the fund, select the Look Ahead Processing option.
  12. Specify a lag period for dividend payment, if necessary, in the Payment Lag field.
  13. Specify a lag period for reinvestments, if necessary, in the Reinvestment Lag field.
  14. Specify the holiday rule to be applicable for cash dividends for the fund.
  15. In the Lead Times section, specify the lead times for freeze holdings, book closing, directors’ meeting and dividend payment, as applicable for cash dividends for the fund.

Setting up Rules for Stock Dividend for Fund

To set up the guidelines for a stock dividend for a fund in the Corporate Actions screen,

  1. The ID of the fund and the Rule Effective Date are filled in from the Fund Demographics screen.
  2. In the Corporate Action type field, select “Stock Dividend”. The following information is considered by default for stock dividends:
  3. Since stock dividends are exempt from tax, the TDS Basis field has a default value, “tax-exempt”, and is locked for data entry.
  4. Income Distribution Setup options are not applicable for unit holders eligible for stock dividends, and the option Restrict IDS for Unit Holders is selected and cannot be changed. Also, the distribution mode for such dividends is taken by default to be Reinvestment.
  5. EPU components are not applicable for stock dividends.
  6. Specify the frequencies for declaration and payment of dividend, in the Dividend Declaration Frequency and Dividend Payment Frequency fields respectively.
  7. Specify the rounding rules for dividend, in the Rounding Options and Rounding Precision fields.
  8. Specify the basis upon which exchange rate for dividend will be obtained, in the Dividend Exchange Rate Basis field.
  9. Specify the first dividend declaration date for the fund, in the First Dividend Declare Date field.
  10. Specify the units to be considered for the record date (freeze holdings) for dividend eligibility, in the Units for Freeze Holding field.
  11. If look-ahead dividend processing for holidays is to be applicable for stock dividends for the fund, select the Look Ahead Processing option.
  12. Specify a lag period for dividend payment, if necessary, in the Payment Lag field.
  13. Specify a lag period for reinvestments, if necessary, in the Reinvestment Lag field.
  14. Specify the holiday rule to be applicable for stock dividends for the fund.
  15. In the Lead Times section, specify the lead times for freeze holdings, book closing, directors’ meeting and dividend payment, as applicable for stock dividends for the fund.

3.1.11 Fund Load Button

This fund rule enables you to designate different fees or incentives that are levied during the processing of transactions, as applicable for transactions in specific funds. A simple mapping can be done where the appropriate fees or incentives, called loads in the system, may be tagged as applicable to the appropriate transaction types for the appropriate funds.

You can also designate the loads as applicable to certain reference types of transactions, such as standing instructions, policy transactions and so on.

The load details maintained will be attached to the funds using this maintenance screen. Only authorized loads can be attached to a fund, whose fund rules are not authorized.

To map loads to a fund, use the Fund Load Setup screen. You can invoke this screen by clicking the ‘Fund Load’ tab from the Fund Demographics screen.

 

Before you set up a Fund Load mapping profile record for a fund, it is desirable to ensure that the following information is already setup in the system:

You can specify the following fields in this screen:

Fund ID

Display

This field indicates the ID fund for which you are setting up the Fund Load Setup profile. This information is defaulted from the Fund Demographics screen.

Rule Effective Date

Display

The Rule Effective Date for the fund, which you specified in the Fund Demographics screen, is displayed here.

Load ID

Numeric; 5 Characters; Mandatory

Specify the name of the Load (fee/incentive) that must be applied for the selected Fund. You may make your choice from the options provided in the drop-down list.

Note

Load Description

Display

The system displays the description for the selected load ID.

Transaction Type

Alphanumeric; 2 Characters; Mandatory

Specify the transaction type for which the loads are being defined. The adjoining option list displays all valid transaction type codes along with their description. You can choose the appropriate one.

Transaction Description

Display

The system displays the description for the selected transaction type.

From Entity Type

Alphanumeric; 1 Character; Mandatory

Specify the entity that bears this load. Alternatively, you can select From Entity Type from the option list. The list displays all valid entity types maintained in the system.

To Entity Type

Alphanumeric; 1 Character; Mandatory

Specify the entity that will be recipients of the load. Alternatively, you can select To Entity Type from the option list. The list displays all valid entity types maintained in the system.

Processing Frequency

Mandatory

Select the frequency at which this load is to be applied from the drop-down list. The list displays the following values:

Note

Capital Gains Tax may also be designated as an allocation time load.

GL Account Code

Alphanumeric; 10 Characters; Optional

Specify the code that will be used to map this load to its corresponding charge code in the external system.

When transaction information is exported to an external system, if separate books of accounts are to be posted for different loads, this code will be used to identify this load information in the export data.

Debit or Credit

Optional

Indicate whether the applied load would result in a debit or credit for the fund from the drop-down list. The list displays the following values:

This data is captured for information purposes only and has no processing implications in the system database.

Contra Account Code

Alphanumeric; 10 Characters; Optional

Specify the code that will be used to identify the second leg of accounting entries for any transaction, in the event of exporting of transaction information to an external system.

Round Off / Down / Up

Optional

Indicate the rounding options for the load amount for the selected transaction type, for the fund.

Example

Let us suppose that the load amount computed for a subscription transaction is 10.561234, and that this value must be rounded to the 3rd decimal place.

If you indicate rounding up, then the value reckoned would be 10.562.

If you indicate rounding off, then, applying normal rounding off rules, the value reckoned would be 10.561.

If you indicate rounding down or truncation, then the value would be truncated as it is, in the 3rd decimal place, and it would be reckoned as 10.561.

No. of Decimals

Numeric; 1 Character; Mandatory

Indicate the maximum number of decimals that would be reckoned for rounding precision, for the load amount.

Priority Number

Numeric; 22 Characters; Mandatory

Enter a value to specify the priority number in case of optional loads.

For a mandatory load, the priority number is set to 0 and for an optional load the priority number should be unique, i.e., for a given fund, no more than one load can have the same priority number.

Mandatory

Mandatory

Select Mandatory or Optional from drop-down list to specify whether the load is mandatory or optional.

Based on Income?

Optional

Select the based on income details from the drop-down list. The list displays the following values:

If the load is a Capital Gains Tax, and it is to be applied based on the gross amount after allocation, choose the Capital Gains – Gross option in this field, for such a load.

If indexation is being applied for capital gains tax computation, choose the Capital Gains – Indexation option in this field. The capital gains load is then applied using appropriate indexation, according to the option chosen by the investor.

If Contingent Deferred Sales Charge (CDSC) is applicable for transactions in this fund, choose the option CDSC option in this field to identify the CDSC load. This option will be available only when Fund chosen is CDSC applicable Fund.

If the ageing policy for the fund has been specified as ‘IOF/IRRF’ optimization in the General Operating Rules screen, then the following additional options are available:

If Dilution Levy is selected, then the system applies the load only if the sum of transactions for the combination of unit holder, fund, and transaction type exceeds the breach factor (inflow/outflow) for the corpus, even though all other criteria are satisfied. An EOD batch computes the aggregated net transaction amount at unit holder, fund, and transaction type level for dilution levy enabled fund. If dilution levy limit of a fund is breached, then the system applies the dilution levy load is applied for specific or all transactions for that unit holder, fund and transaction type combination based on the parameter set.

A system parameter DILUTIONLEVY governs whether Dilution Levy needs to be applied for specific or all Unit Holder (for Unit Holder, Fund, Transaction Type combination) transactions. The parameter value S indicates that Dilution Levy is applicable for specific transactions only whereas parameter value A indicates that Dilution Levy is applicable for all transactions for Unit Holder, Fund, and Transaction Type combination.

The above options are provided under the criterion that the transaction type is redemption and price to load is set to ‘No’. These options are applicable only for normal and systematic withdrawal ref types.

Note

You can select the load with Short Trade Units option to calculate penalty charge for outflow transactions with short trade units, i.e., in case of outflow transaction captured with Nominee Account and Short Trade Units Details are entered.

You can select the load with Short Trade Period option to calculate penalty charge for outflow transactions when the transaction is captured for other than Nominee account.

The system will identify Off-Shore/ On-Shore fund based on the Installed entity country and Fund country.

If Installed entity country and Fund country are same, then the system will classify the fund as Off-Shore fund.

If Installed entity country and Fund country are not same, then the system will classify the fund as On-Shore fund.

Installed EntityID

Installed EntityID Country

TWDDISTE

TWD

Fund ID

Fund Country

Classification

OFFSHR

HKG

OFFSHORE

ONSHR

TWD

ONSHORE

VAT Applicable?

Mandatory

Select ‘Yes’ from drop-down list to indicate that the Load to Price is applicable. Therefore VAT Load to Price is dependent on Load to Price.

Differential Fee?

Mandatory

Select ‘Yes’ from drop-down list to indicate that the differential fee in the case of switch transactions for any fund is to be applicable.

Send for GL Interface

Mandatory

Select ‘Yes’ from drop-down list to indicate that accounting entries due only to the selected load must be posted to the external asset management system, for the fund.

Slab Basis

Optional

Select the basis on which the slabs will be reckoned for an amount-based load that you are designating as applicable for the fund from the drop-down list. The list displays the following values:

Apply Indexation on CGT?

Optional

If the load is a capital gains tax load, you can use this field to indicate whether indexation is to be applied on capital gains tax computation, for transactions in this fund. Select ‘Yes’ from drop-down list to indicate application of indexation. Else select ‘No’.

Price Add In

Mandatory

Select ‘Yes’ from drop-down list to indicate that the add-in factor is to be applicable for computing the return value for the load, for the selected transaction type. The add-in factor is used to arrive at the return value for a load, at the time of allocation.

Level ID

Numeric; 22 Characters; Optional

Indicate the order in which the load is to be applied. Load is computed based on the fund transaction amount and applied in the order of level id specified.

Note

Level ID is not applicable for LTP loads.

Load To Price

Mandatory

Select ‘Yes’ from drop-down list to indicate that this load is to be loaded to the base price.

Note

Load To Price to be set to No at fund load level.

Dependent Level

Numeric; 22 Characters; Optional

Indicate the dependent level for the selected load, if any.

In case the load has a dependent level, then load will be applied on the difference between the transaction amount and the sum of all dependent level load amounts, without considering all recursive levels.

Note

The dependent level Id must be less than the Level Id. The dependent level Id is not ap­plicable for LTP loads.

FDAP Income

Optional

Select ‘Yes’ from drop-down list to indicate the load maintenance is a FDAP income.

This field is applicable only when ‘To Entity’ is Broker/Agent/Agency Branch/AO/IFA and ‘From Entity’ is fund/AMC/Unit holder. For other cases, if you check this field, then the system will display the warning message. However, if you wish to continue, then the system will do the WHT deductions and processes.

Details

Ref Type

Alphanumeric; 4 Characters; Optional

To designate a load as being applicable for a reference transaction type for the selected fund, select the load reference type from the Available Reference Types box and move it to the Mapped Reference Types box, using the arrows.

If loads are to be designated applicable to reference types for a fund, you must set up an individual fund-load mapping record in this screen for each reference type for the fund, just as you do for each transaction type.

Example

If the AMC wants a fee to be charged on subscription transaction but not on reinvestment transaction, it can map only subscription transaction in the Ref Type field and not the reinvestment.

Note

It must be remembered that, while mapping a load to a reference transaction type, the sys­tem does not support the mapping of the Ref Type 68 (Funding Repayment) to any load.

For more information, refer the chapter ‘The Allocation Process’ in the ‘Fund Manager User Manual’.

3.1.12 Fund Formula Setup Button

This fund rule is an optional one that facilitates the definition of mathematical expressions and factors that will be used in computation of any of the components in the NAV, Transaction Base Prices, etc.

To set up a formula for a fund, use the Fund Formula screen. You can invoke this screen by clicking the ‘Fund Formula Setup’ link from the Fund Demographics screen.

 

Before you set up a Fund Formula record for a fund, it is desirable to ensure that the following information is already setup in the system:

You can specify the following fields in this screen:

Fund ID

Display

This field indicates the ID fund for which you are setting up the Fund Formula. This information is defaulted from the Fund Demographics screen.

Rule Effective Date

Display

The Rule Effective Date for the fund, which you specified in the Fund Demographics screen, is displayed here.

Used for Fund Price Computation

Mandatory

Select ‘Yes’ from drop-down list if the rule is for fund price computation or not.

Fund Formula Section

Component ID

Alphanumeric; 10 Characters; Mandatory

Specify the component of the fund price, for which an expression is being defined for computation, by selecting any one of the Component ID’s, from the list given. This is an Alphanumeric ID that is used to build the fund formula.

The component could be one of the standard price bases such as the Net Asset Value or Transaction Base Prices; or an additional price basis such as Offer Price, Bid Price, Price Before Performance, Price After Performance and so on. These additional price bases are built on the appropriate parent standard price bases.

For instance, the additional price basis ‘Offer Price’ could have the standard price basis TBP02 as its parent.

Additional price bases can be defined only if multiple price bases are allowed as indicated in the General Operating Rules for the fund.

If multiple price bases are defined, you must also indicate the applicable inherent fees or incentives.

Component Type

Alphanumeric; 5 Characters; Mandatory

Specify the component type. Alternatively, you can also select component type from the option list.

Component Description

Alphanumeric; 50 Characters; Mandatory

Enter any text message or remark regarding the formula. This is a free format text.

Formula

Alphanumeric; 255 Characters; Optional

When Formula is selected as the Component Type, then this field becomes mandatory. Any text or value entered here should be equal to the result of the formula. When Formula is not selected as the Component Type, then this field becomes unavailable for data entry.

Fluctuation(%)

Numeric; 5 Characters; Optional

You can specify the fluctuation allowable in the additional components (typically tax components) for the transaction type, for the fund. When prices are entered for the transaction type for the fund, for the day, the system validates whether the fluctuation is within the allowable limit specified in this field.

Default Value

Numeric; 22 Characters; Optional

Specify the data value.

Price Basis

Mandatory

If multiple price bases are allowed as indicated in the General Operating Rules for the fund, you can use this field to indicate whether price bases other than the NAV and Transaction Base Prices are being specified for computation of the fund price component, using the formula specified.

For the NAV and Transaction Base Price components, the ‘Yes’ option is defaulted in this field and cannot be changed. For additional components, you can select ‘Yes’ to indicate additional bases, or ‘No’ if no additional bases are being used in the formula.

Parent Basis

Alphanumeric; 10 Characters; Optional

For components used for additional price bases, specify the standard price basis from which the additional price basis derives, in this field. You can select either the NAV or the Transaction Base Price as the parent price basis. NAV can be chosen as the parent price basis only for NAV components.

Additional price bases can only be defined if allowed for the fund in the General Operating Rules.

For components used for standard price bases such as NAV and Transaction Base Price, the parent price basis is defaulted to the component itself.

Inherent Fee

Numeric; 22 Characters; Optional

If multiple price bases are defined, you must also indicate the applicable inherent fee in this field. You can use the ‘Find’ link to select the applicable loads. The selection list displays loads tagged as Price Basis Loads in the Load Definition.

For Transaction Base Prices, the inherent fee / incentive cannot be parameterized.

Note

Any loads that have been defined as price basis loads are only used as the indicator for computing load values, and are not picked up during evaluation of criteria. That is, the oth­er load details specified for such loads, such as the return value, slabs and so on, are not taken into consideration. The difference between the Transaction Base Price and the Price Basis defined for the transaction is considered as an inherent fee or incentive, during allo­cation.

For instance, if the Price Basis for a transaction is ‘Offer Price’, and Transaction Base Price is 1.009 and the Offer Price is 1.060, the difference (1.06-1.009 = 0.051, without currency rounding) is considered as the inherent fee (since the TBP is less than the offer price). If the offer price were less than the TBP, the difference between the two is considered an inherent incentive.

Inherent Incentive

Numeric; 5 Characters; Optional

If multiple price bases are defined, you must also indicate the applicable inherent incentive loads in this field.

Exclude

Mandatory

Select ‘Yes’ option from drop-down list indicate that the selected price component must be excluded from capital gains computation. This specification can only be made for the user-entered components.

This feature is only available if your installation has specifically requested for it.

Default

Mandatory

For each of the standard price basis components that are used as parent price bases, (that is, the NAV and the Transaction Base Prices) you must assign one default price basis value. Check this box to default price basis value.

For instance, you have defined the components Offer Price 1 and 2, with the parent price basis TBP02. You must choose either Offer Price 1 or 2 as the default price basis value for TBP02.

Click ‘Compute’ button to compute the fund price.

3.1.12.1 Entering Fund Formulae

The following considerations must be kept in mind while entering Fund Formulae:

The maintained fund formula for that fund will be applicable to all the prices in all allowed currency of expression for the Fund along with FBC.

The formula maintained for OFFER component as OFFER = NAV+3%of NAV (or the formula maintained can be NAV+2). This formula will be considered to derive the OFFER price component in FBC and other maintained Fund Price currencies for that fund using the NAV entered for respective currencies. This will be similar for other price components maintained in Fund Formula.

The price calculation method must be identical for each transaction currency within each share class. Trailer commission will be calculated in FBC.

In case of load held as amount, the system to apply the COE conversion factor and also the floor, ceiling and return value held in FBC will also use COE currency factor. All the amount values maintained in Load maintenance will be in FBC and the system will use CEO conversion factor for amount based load.

Definition of Additional Components with Fund Prices

You can record additional components to be used for reporting along with the fund price, such as tax information, interim profit, stock profit (capital gains), accumulated gains, and so on. For instance, you may wish to include tax information as part of the Fund Price information, but you may wish to indicate that the tax information you provide must not be used for actual price computation.

Note

This feature is only available if your installation has specifically requested for it. An exhaus­tive note on this feature is found in the Annexure. The discussion in this chapter pertains only to definition of fund formula using components used in fund price computation.

System logic to derive the Price Currency

You can derive the applicable fund price currency for currency of expression fund transactions as follows:

When TBC= fund base currency then price currency will be FBC itself. No FX will be required. This is applicable for subscription, redemption and switch transactions.

When a trade is placed in a currency (TBC) that is the allowed fund price currency for the fund then Price currency will be respective fund price currency. No FX will be required. This is applicable for Subscription, Redemption and Switch transactions.(TBC = FPC then price CCY will be FPC)

When a trade is placed in a currency that is neither the fund base currency nor an allowed fund price currency for the fund, Price Currency will be FBC. FX will be required between Transaction Currency and FBC. This is applicable for Subscription and redemptions. (TBC ≠FBC or FPC; then Price CCY will be FBC.)

Scenarios

Transaction Type

TBC

FX

Resultant Price CCY

TBC= FBC

Subscription, Redemption, Switch

FBC

Not Applied

FBC

TBC=FPC

Subscription, Redemption, Switch

FPC

Not Applied

FPC

TBC≠FBC or FPC

Subscription Redemption, switch

≠FBC or TBC

Yes TBC to FBC

FBC

3.1.13 Additional Information Button

To maintain any additional information for a fund, click on the Additional Information button in the Fund Demographics screen. The Additional Information Details screen is opened, with the different information heads maintained for the AMC, where you can specify the information.

 

You can only maintain additional information if any information heads have been maintained in the System Parameters, to be applicable for funds, for the AMC.

Click ‘Get Additional Information’ button to view the following additional information details:

The information heads that you maintain are user defined. You will have to map the same against the entity type ‘Fund’ in the Entity Mapping Maintenance screen.

Note

The Additional Information section allows you to capture valuation data and has no pro­cessing implications.

Refer to the chapter Maintaining System Parameters in Volume 1 of the Fund Manager User Manual for further information.

3.1.14 Specific Fund Price Date Button

The price (Real NAV) applicable for a fund is declared on a daily basis by the Fund Manager. On any business day, the transactions that are entered are picked up and allocated by the End of Day process using the Real NAV declared for that business day.

You can also set up a specific date on which all transactions entered during a period can be allocated, using the price as on that date. This specific date can be maintained for each transaction type mapped to a fund. A specific pricing frequency can also be set up for the application of the specific pricing date.

Example

For the Carey Bugle Memorial Fund, a specific price date has been maintained for IPO and subscription transactions, which is the 15th January 2002. The specific pricing is to be applied on a monthly frequency basis, the first specific price date being 15th January 2002. The declared price on this date is 12.45 for IPO, and 12.34 for subscription.

All IPO and subscription transactions that have been entered into the Carey Bugle Fund from the 1st January 2002 till the 15th January 2002 will be allocated on 15th January 2002, using the prices 12.45 and 12.34 respectively.

Any IPO or subscription transactions entered between 1st January and 15th can be redeemed by the concerned unit holders only after 15th January.

The next specific pricing date for IPO and subscription transactions will be 15th February 2002, (the pricing frequency being monthly), and all IPO and subscription transactions entered between 16th January 2002 and 15th February 2002 will be allocated on this date.

Note

If specific pricing has been defined for a fund, the specific pricing parameters would take precedence over the pricing method and frequency defined in the General Operating Rules for the fund.

To set up specific price dates for any transaction types mapped to a fund, use the ‘Specific Fund Price Date Setup’ screen. Invoke this screen from the ‘Fund Rules’ screen by clicking ‘Specific Fund Price Date’ link.

Setting up the specific price date is an optional fund rule, and may be edited, authorized or amended just as the other fund rules.

For a fund, you can specify whether specific prices are to be applicable:

 

You can specify the following fields in this screen:

Fund ID

Display

This field indicates the ID fund for which you are setting up the Specific Price Date rule. This information is defaulted from the Fund Demographics screen.

Rule Effective Date

Display

The Rule Effective Date for the fund, which you specified in the Fund Rules Detail screen, is displayed here.

Price Frequency

Mandatory

Select the frequency at which the pricing dates will occur, from the options in the drop-down list.

If you choose an option other than daily, you must define the frequency of pricing for the fund in Pricing Frequency Definition screen. The frequency of fund-price input and allocations will happen on dates based on the definitions in Pricing Frequency Definition screen

Forward Pricing Applicable

Mandatory

You can use this field to indicate whether forward specific pricing is applicable for the fund. To select this option, choose ‘Yes’ from drop-down list.

When you opt for forward pricing, you should choose the ‘User Defined’ option for Price Frequency and define the price dates in the ‘Details’ section in the Pricing Frequency Definition screen. You may, if you choose, also maintain a Cut-off frequency.

If forward pricing is applicable, then you must also indicate the parameters given below in addition to the pricing frequency and the holiday rule:

Note

Forward specific pricing can be indicated only for post-priced funds.

Calendar Basis

Optional

In this field you can indicate whether the pricing frequency takes into consideration the fund calendar, system calendar or the actual calendar. Select the desired option from the drop-down list.

Forward Pricing Applicable

Select ‘Yes’ from drop-down list if forward pricing is applicable. Else select ‘No’.

If you indicate forward pricing is not allowed, you will be able to view the fields in the screen given above. You must specify the following information in the Details section to set up a specific pricing date.

Price Day

Optional

Select the specific date on which the price used for allocation is declared from the drop-down list. Consequent to this first price date, the system will arrive at the next price date by taking into consideration the price frequency.

The date specified here must be the Rule Effective Date. Future dates cannot be specified.

Price Month

Optional

Select the month when the price is to be user input from the drop-down list.

Price Week

Optional

Select the month when the price is to be user input from the drop-down list.

Price Frequency Definition

Alphanumeric; 1 Character; Optional

Specify the frequency at which the pricing dates will occur. The adjoining option list displays the valid price frequency definition codes maintained in the system. You can choose the appropriate one. In the option list you will find information on price frequency and the price frequency definition.

The system displays the description the adjacent field.

Auto Generation Of Fund Prices

Optional

Choose one of the following options for automatic fund price generation from the drop-down list:

Note: As mentioned earlier, if specific pricing has been defined for a fund, the specific pricing parameters would take precedence over the pricing method and frequency defined in the General Operating Rules for the fund. Also, the prices for funds with specific pricing are only picked up on the specific pricing date (the Price Day).

For such funds, you may require fund price information on all working days of the selected calendar (fund or system), even though the price is picked up for transactions only on the specific pricing date. You can indicate automatic generation of fund prices, for such funds. When you indicate automatic generation of fund prices, the system uses the last available price for the fund, and automatically generates the fund price for each working day.

You can specify the required option for automatic generation of prices, in the Auto Generation of Fund Prices field.

Note

Details

Transaction Type

Alphanumeric; 2 Characters; Mandatory

Select the type of transaction for which the specific pricing date is applicable, for the fund.

First Price Date

Date Format; Mandatory

Indicate the specific date on which the price used for allocation is declared. Consequent to this first price date, the system will arrive at the next price date by taking into consideration the price frequency.

The date you specify here should be the same as the Rule Effective Date.

If you wish to specify the first price date as a future date, then you must indicate forward pricing.

Holiday Rule

Mandatory

In the event of the price date being a holiday in the system, indicate whether the next or previous working day is to be considered as the price date.

If the next working day is to be considered, select ‘Next Day’ from the drop-down list. If the previous working day is to be considered, select ‘Previous Day’ from the drop-down list.

Dealing Lag (In Days)

Numeric; 22 Characters; Optional

Indicate the lag period (in days) for the dealing date. The lag value is interpreted in fund calendar days, and is used to arrive at the dealing date for the fund price.

Dealing date is the number of business days (based on the fund calendar) prior to/after the price date of the fund.

Dealing Rule

Optional

Select the dealing rule from the drop-down list to be applied while deriving the dealing date. Dealing date for a transaction is derived based on the forward or backward lag with regard to the fund price date.

If the dealing rule is ‘After’, then the dealing lag will be added to the price date. If the dealing rule is ‘Prior’, then the dealing lag will be deducted from the price date.

Cut-Off Day

Numeric; 22 Characters; Optional

You may choose to maintain cut-off dates for funds to facilitate ease of operation.

Cut-Off Week

Numeric; 22 Characters; Optional

Specify the cut-off week for funds

Cut-Off Month

Numeric; 22 Characters; Optional

Specify the cut-off month for funds

Cut-Off Frequency

Optional

Select the transaction cut-off date options for different frequencies, from the options in the drop down list.

Cut-Off Frequency Definition

Optional

Specify the frequency at which the cut-off should take place by choosing one of the following from the drop-down list:

Trading at cut off applicable

Optional

Select if trading at cut off is applicable or not from the drop-down list. The list displays the following values:

If you select ‘Yes’, the system will derive the transaction date as single date in the specified pricing frequency. You will not be able to change transaction date/Order received date and time post authorization.

If you select ‘No’, the system will derive the transaction date entered in the system. The Price Date will be derived using the transaction date and based on fund pricing rules that will remain unchanged.

Trade cut off holiday rule

Optional

Select the trade cut off holiday rule from the drop-down list. The list displays the following values:

Trade cut off calender basis

Optional

Select the trade cut off calendar basis from the drop-down list. The list displays the following values:

User Defined Price Date

Price Date

Date Format; Mandatory

If you choose the option User Defined, you should specify the price dates.

You can specify the Price Dates in the Details section by clicking on the option list. This is enabled only when the Pricing Frequency Definition option is User Defined.

In all cases, if the next price date falls on a holiday, the holiday rule set for the specific date setup is applied to arrive at the next price date.

You can also specify the last day of the cycle (month, quarter, half-year or year) as the price date. To do this, check the option ‘Based on last specified day of the cycle’. Prices are made available on the last day of the cycle that you specify. You can specify any weekday from Sunday to Saturday as the last day. For instance, if you have specified a monthly frequency, enabled the ‘Based on last specified day of the cycle’ option, and specified Sunday as the last day, prices are made available on the last Sunday of each month.

Note

The prices that are generated will be used for reporting only. You will however, be allowed to Edit/Amend the Unauthorized/Authorized fund price that is generated if any Adhoc Price Dates are maintained that day.

3.1.14.1 Specifying Price Date Options for Different Frequencies

You can specify the price date options for different frequencies according to the guidelines in the table below:

Pricing Frequency

Price Day

Price Week

Price Month

Remarks

Daily

 

 

 

Prices will be made availa­ble on all days of the chosen cal­endar.

Weekly

Any day from Sunday to Satur­day *

 

 

Prices will be picked up as on the speci­fied price day

Fortnightly

Any day from Sunday to Satur­day for the selected week *

Either the first week or the second week of the fortnight

 

Prices will be picked up as on the speci­fied price day

Monthly (based on month day)

Any day from the 1st to the 31st of the month

 

 

Prices will be picked up as on the speci­fied price day

Monthly (based on week and weekday)

Any day from Sunday to Satur­day for the selected week *

Any week from the first to the last week of the month

 

Prices will be picked up as on the speci­fied price day

Quarterly

Any day from Sunday to Satur­day for the selected week *

Any week from the first to the last week of the selected month

Any month from the first to the third month of the quarter

Prices will be picked up as on the speci­fied price day

Half-Yearly

Any day from Sunday to Satur­day for the selected week *

Any week from the first to the last week of the selected month

Any month from the first to the sixth month of the half-year

Prices will be picked up as on the speci­fied price day

Yearly

Any day from Sunday to Satur­day for the selected week *

Any week from the first to the last week of the selected month

Any month from the first to the twelfth month of the year

Prices will be picked up as on the speci­fied price day

User Defined

 

 

 

Prices will be made availa­ble on days chosen.

“*” - Sunday is considered the first day of the week, and Saturday, the seventh day.

For quarterly frequencies, you can indicate either of the following:

For half-yearly frequencies, you can indicate:

For yearly frequencies, you can indicate:

3.1.14.2 Specifying Cut-off date for Different Frequencies

You can specify the transaction cut-off date options for different frequencies according to the guidelines in the table below:

Cut-off Frequency

Cut-off Day

Cut-off Week

Cut-off Month

Weekly

Any day from Sunday to Saturday *

 

 

Fortnightly

Any day from Sunday to Saturday for the selected week *

Either the first week or the second week of the fortnight

 

Monthly (based on month day)

Any day from the 1st to the 31st of the month

 

 

Monthly (based on week and weekday)

Any day from Sunday to Saturday for the selected week *

Any week from the first to the last week of the month

 

Quarterly

Any day from Sunday to Saturday for the selected week *

Any week from the first to the last week of the selected month

Any month from the first to the third month of the quarter

Half-Yearly

Any day from Sunday to Saturday for the selected week *

Any week from the first to the last week of the selected month

Any month from the first to the sixth month of the half-year

Yearly

Any day from Sunday to Saturday for the selected week *

Any week from the first to the last week of the selected month

Any month from the first to the twelfth month of the year

“*” - Sunday is considered the first day of the week, and Saturday, the seventh day.

3.1.14.3 How pricing frequency is considered

Without Forward Pricing

If the first specific price date is the rule effective date (application date), the next price date is arrived at based on the pricing frequency as follows:

Pricing Frequency

Next price date

Daily

Last price date + 1 calendar day

Weekly

Last price date + 7 calendar days

Fortnightly

Last price date + 14 calendar days

Monthly

Last price date + 30 calendar days

Quarterly

Last price date + 90 calendar days

Half-Yearly

Last price date + 180 calendar days

Yearly

Last price date incremented by one year

If the next specific price date so arrived at falls on a holiday, the holiday rule defined for the specific price date is taken into account. Accordingly, the actual price date is taken as the next working day (if the holiday rule is ‘After’) or the previous working day (if the holiday rule is ‘Prior’)

Note

The actual calendar is considered in arriving at the next price date, in the logic discussed above.

Forward Pricing

If the first specific price date is a date in the future (forward pricing), the next price date is arrived at based on the following factors:

The next price date is arrived at as given in the example below for various combinations:

Price Frequency

Price Month

Price Week

Price Day

Price available on

Daily

 

 

 

Price can be entered from Sunday to Sat­urday

Weekly

 

 

3

Third day (Tuesday) of every week

Fortnightly (Price week specified)

 

1

4

Fourth day of the first week of the fort­night.

Fortnightly (Price week not specified)

 

 

4

Fourth day of the fortnight

Monthly (Price week speci­fied)

 

4

2

Monday of fourth week of every month.

Monthly (Price week not specified)

 

 

2

Second day of the month

Quarterly

1

1

1

Sunday of first week of first month of every quarter.

Half Yearly

5

2

4

Fourth day of second week of fifth month of every half.

Yearly

9

3

5

Last day of third week of every Septem­ber.

If the next specific price date so arrived at falls on a holiday in the specified calendar (Fund or System), the holiday rule defined for the specific price date is taken into account. Accordingly, the actual price date is taken as the next working day (if the holiday rule is ‘Next Day’) or the previous working day (if the holiday rule is ‘Previous Day’)

3.1.14.4 How Cut-off Frequency is Considered

The system determines the specific pricing cycle (either current or subsequent) to be used based on the cut-off frequency and cut-off days defined for the transaction type.

If the transaction date exceeds the cut-off date, the price date is moved to the next specific pricing cycle.

The cut-off date is arrived at as given in the example below for various combinations:

Cut-off Frequency

Cut-off Month

Cut-off Week

Cut-off Day

Remarks

Weekly

 

 

3

Third day (Tuesday) of every week

Fortnightly (Price week specified)

 

1

4

Fourth day of the first week of the fortnight.

Fortnightly (Price week not specified)

 

 

4

Fourth day of the fortnight

Monthly (Price week specified)

 

4

2

Monday of fourth week of every month.

Monthly (Price week not specified)

 

 

2

Second day of the month

Quarterly

1

1

1

Sunday of first week of first month of every quarter.

Half Yearly

5

2

4

Fourth day of second week of fifth month of every half.

Yearly

9

3

5

Last day of third week of every September.

The examples given below illustrate how the cut-off frequency is considered.

Example 1

Pricing Frequency

Price Day

Cut-off Frequency

Cut-off Day

Weekly

4 (Thursday)

Weekly

1 (Monday)

Let us suppose the current date is a Wednesday. Since it is beyond the cut-off day for the week, the specific price date is moved to the next cycle, that is, the specific price of the Thursday of the week is considered.

Example 2

Pricing Frequency

Price Day

Cut-off Frequency

Cut-off Day

Cut-off Week

Weekly

4 (Thurs­day)

Monthly

1

4

The cut-off day is the Monday of the fourth week of the month. If the current date is 10th September 2003 (say a Wednesday), it falls in the second week of the month. Since it is before the cut-off day for the present cycle, the specific price date falls on the current cycle, that is, the pricing on 4th September (the Thursday of the current pricing cycle) is considered.

If, in this same example, the cut-off week is 2, then the cut-off day is the Monday of the second week of the month. Since the current date, 10th September 2003, a Wednesday, is beyond the cut-off day, the specific price date is moved to the subsequent cycle, that is, the pricing on 11th September (the Thursday of the subsequent pricing cycle) is considered.

Note

The number of business working days is considered while determining the cut off days. The number of cut off days does not include the Fund holiday and the AMC Holiday.

3.1.15 Amount Limits for IRA Transactions Button

For funds in which you have allowed IRA (Individual Retirement Account) investment, you can define the transaction limits. Use the Amount Limit for IRA Transactions section in the Fund Rules Detail screen to specify the limits.

 

It is mandatory for you to specify the IRA Limits fund rule for funds in which IRA investments are allowed.

The following limits are specified:

You can specify the following details in this section:

Initial Investment

Minimum Amount (Initial Investment)

Numeric; 30 Characters; Mandatory if IRA investment is allowed for the fund

Specify the minimum amount that can be contributed in the initial investment into this fund, for a plan purchased in a product for which the fund forms part of the portfolio. This limit cannot exceed the corresponding limit set for the product, the portfolio of which the fund is a part.

Maximum Amount (Additional Investment)

Numeric, 30 Characters; Mandatory if IRA investment is allowed for the fund

Specify the maximum amount that can be contributed as an additional investment into this fund, for a plan purchased in a product for which the fund forms part of the portfolio. This limit cannot exceed the corresponding limit set for the product, the portfolio of which the fund is a part.

Subsequent Investments

Maximum Amount

Numeric; 30 Characters; Mandatory if IRA investment is allowed for the fund

Specify the maximum amount that can be contributed in the initial investment into this fund, for a plan purchased in a product for which the fund forms part of the portfolio. This limit cannot exceed the corresponding limit set for the product, the portfolio of which the fund is a part.

Minimum Amount

Numeric; 30 Characters; Mandatory if IRA investment is allowed for the fund

Specify the minimum amount that can be contributed as an additional investment into this fund, for a plan purchased in a product for which the fund forms part of the portfolio. This limit cannot exceed the corresponding limit set for the product, the portfolio of which the fund is a part.

Withdrawals

Minimum Amount

Numeric; 30 Characters; Mandatory if IRA investment is allowed for the fund

Specify the minimum amount that can be withdrawn through a withdrawal transaction out of this fund, for a plan purchased in a product for which the fund forms part of the portfolio. This limit cannot exceed the corresponding limit set for the product, the portfolio of which the fund is a part.

Maximum Amount

Numeric; 30 Characters; Mandatory if IRA investment is allowed for the fund

Specify the minimum amount that can be withdrawn through a withdrawal transaction out of this fund, for a plan purchased in a product for which the fund forms part of the portfolio. This limit cannot exceed the corresponding limit set for the product, the portfolio of which the fund is a part.

3.1.16 Fund Delivery Instructions Button

You can specify the fund delivery instructions details by clicking ‘Fund Delivery Instructions’ button in ‘Fund Rule Details’ screen.

 

You can specify the following details:

Fund ID

Display

This field indicates the ID fund for which you are setting up the Fund Investment Account profile. This information is defaulted from the Fund Demographics screen.

Rule Effective Date

Display

The Rule Effective Date for the fund, which you specified in the Fund Demographics screen, is displayed here.

Registered Unit Holder Account

Optional

Select if the unit holder account is registered or not from the drop-down list. The list displays the following values:

Deliver to Custodian Account

Optional

Select if the fund details are delivered to the custodian account or not from the drop-down list. The list displays the following values:

Deliver to Clearing Agent

Optional

Select if the fund details are delivered to the clearing agent or not from the drop-down list. The list displays the following values:

Physical Delivery - Certificate Option

Optional

Select if the certificate-based funds are physically delivered along with certificates to the customer or not from the drop-down list. The list displays the following values:

PUEV

Optional

Select if PUEV option is yes or not from the drop-down list. The list displays the following values:

Default Account

Optional

Select the default account options from the drop-down list. The list displays the following values:

Details

Denomination

Alphanumeric; 200 Characters; Optional

Specify the denomination details.

Default

Optional

Select if the denomination details are defaulted or not from the drop-down list. The list displays the following values:

3.1.17 Fund Investment Account Button

To associate the allowable fund investment account types for a fund, you can use the Fund Investment Account screen. When you are setting up a fund, you can invoke this screen from the Fund Demographics screen by clicking on the Fund Investment Account link.

Note

You can also use the Fund Investment Account screen to map provident fund account types as well as non-provident fund account types (such as cash nominee account types) to a fund.

In this screen, select the allowable fund investment account types for the fund, in the Account Type field.

For each investment account type that you associate for the fund, you must specify a validity period, by indicating a start date for validity and an end date.

Operations on Fund Investment Account Specifications

The Fund Investment Account specifications can be copied for child umbrella funds or made part of a fund template. They can also be uploaded from a bulk client as fund rules for a fund.

Through the fund rule amendment function, you can change the account types allowable, by revoking an existing allowable account type, and allowing a new type.

You can specify the following fields in this screen:

Fund ID

Display

This field indicates the ID fund for which you are setting up the Fund Investment Account profile. This information is defaulted from the Fund Demographics screen.

Rule Effective Date

Display

The Rule Effective Date for the fund, which you specified in the Fund Demographics screen, is displayed here.

Details Section

Account Type

Numeric; 2 Characters; Optional

Specify the fund investment account type that you wish to allow, for the fund. You can select either CPF or non-CPF account types in this field, to be mapped for the fund.

Account Types Description

Display

The system displays the based on the account type selected.

Minimum Age

Numeric; 3 Characters; Mandatory

Specify a minimum age required for an investor to invest in the for the account type specified. If the age of the investor is lower than the minimum age specified, he will not be allowed to invest in this account type,

Start Date

Date Format; Optional

Specify the date that marks the beginning of the period for which the selected fund investment account type is allowed for the fund.

If you have selected a non-CPF account type, you need not specify the Start Date. The system defaults the Low Date Value maintained in the Defaults Maintenance as the Start Date.

End Date

Date Format; Optional

Specify the date that marks the end of the period for which the selected fund investment account type is allowed for the fund.

If you have selected a non-CPF account type, you need not specify the End Date.

3.1.18 SI Specific Information Button

In this section, you can maintain the rules for standing instruction generation that are to be applicable for the fund. Click ‘SI Details’ button in ‘Fund Rules Detail’ screen. The following window is displayed:

 

You can specify the following fields in this screen:

Fund ID

Display

This field indicates the ID fund for which you are setting up the Fund Investment Account profile. This information is defaulted from the Fund Demographics screen.

Rule Effective Date

Display

The Rule Effective Date for the fund, which you specified in the Fund Demographics screen, is displayed here.

Details

Transaction Type

Alphanumeric; 2 Characters; Mandatory

Specify the transaction type for which the amount limitations are to be maintained. Alternatively, you can select the transaction type from the option list. The list displays all the valid transaction type maintained in the system.

Account Type

Alphanumeric; 2 Characters; Mandatory

Specify the account type for which the amount limitations are to be maintained. Alternatively, you can select the account type from the option list. The list displays all the valid account type maintained in the system.

Holiday Rule

Mandatory

Select holiday rule from the drop-down list. The list displays the following values:

Calendar Basis

Mandatory

Select the calendar basis from the drop-down list. The list displays the following values:

Default SI Frequency

Mandatory

Select default SI frequency from the drop-down list. The list displays the following values:

SI Description

Alphanumeric; 255 Characters; Optional

Specify the SI description.

Specific Gen.Day

Alphanumeric; 3 Characters; Optional

Specify the specific generation day.

SI Generation Freq.

Mandatory

Select SI generation frequency from the drop-down list. The list displays the following values:

SI Minimum Amount

Numeric; 30 Characters; Optional

Specify the SI minimum amount.

SI Maximum Amount

Numeric; 30 Characters; Optional

Specify the SI maximum amount.

SI Minimum Units

Numeric; 27 Characters; Optional

Specify the SI minimum amount.

SI Maximum Units

Numeric; 27 Characters; Optional

Specify the SI maximum amount.

SI Cut-Off Day

Numeric; 22 Characters; Optional

Specify the SI cut-off day.

SI Cut-off Lag

Numeric; 22 Characters; Optional

Specify the SI cut-off lag details.

Enforce Generation

Mandatory

Select ‘Yes’ from drop-down list to enforce generation.

Max. Validity(Days)

Numeric; 22 Characters; Optional

Specify the maximum validity in days.

Max No. of SI Txns

Numeric; 22 Characters; Optional

Specify the maximum number of SI transactions.

Last Day of SI Gen Cycle

Optional

Select if last day of SI generation cycle to be considered from the drop-down list. The list displays the following values:

SI Auto-Termination Cumulative Counter

Numeric; 3 Characters; Optional

Specify the SI auto termination cumulative counter.

SI Auto-Termination Consecutive Counter

Numeric; 3 Characters; Optional

Specify SI Auto-Termination Consecutive Counter details.

3.1.19 KYC Maintenance Button

You can maintain a list of required KYC documents specific for the fund. Click on the KYC Maintenance link in the Fund Demographics screen. The KYC Maintenance Detail screen is opened.

 

You can specify the following fields in this screen:

Fund ID

Display

This field indicates the ID fund for which you are setting up the Fund Investment Account profile. This information is defaulted from the Fund Demographics screen.

Rule Effective Date

Display

The Rule Effective Date for the fund, which you specified in the Fund Demographics screen, is displayed here.

Details

Requirement

Alphanumeric; 255 Characters; Mandatory

Specify the required document details to indicate that the document must be collected from the investor.

3.1.20 Documents Button

Click ‘Documents’ button in ‘Fund Rules Detail’ screen to upload the documents.

 

You can upload the required documents by clicking ‘Upload’ button.

3.1.21 Hedge Fund Tab

You can specify the fund rules associated with hedge funds in ‘Hedge Fund Processing Rules’ screen. To invoke this screen click ‘Hedge Fund’ button in Fund Rules detail screen. You can click this button only if the related fund has been specified as a hedge fund.

 

You can specify the following fields in this screen:

General Details

Hedge Fund Type

Optional

Select the type of the hedge fund from the drop-down list provided. The following options are available:

Note

For more details on various methods of performance fee computation, refer the section titles

‘Computing Performance Fee for Hedge Funds’ section in this user manual.

For more details on different types of hedge funds, refer Overview chapter in this user manual.

Hedge Fund Manager

Alphanumeric; 12 Characters; Optional

Specify the name of the hedge fund manager or select the fund manager from the option list provided. All entities maintained as fund managers in ‘Entity maintenance’ screen are displayed in the list.

Transaction Generation Basis

Optional

Select the criteria based on which the transaction has to be generated. The following options are available in the drop-down list:

Note

This is applicable for master funds and fund of funds.

Master Fund UH ID

Alphanumeric; 12 Characters; Optional

Specify the unit holder Id for which the master fund transaction is generated.

You can also query for unit holder ID by clicking ‘Find UH’ button.

Note

This is applicable only for master funds.

Performance Fee Details

Performance fee is a periodic fee collected by the fund manager from the investors of the fund, calculated as a percentage of the fund’s profit.

In this section you can specify your preferences related to performance fee calculation. The values you specify here are not applicable for side pocket type of hedge funds.

Group ID

Alphanumeric; 10 Characters; Optional

Specify the rule group to be used for performance fee calculation or select the same from the option list provided. All valid rule groups maintained in the system are displayed in the option list.

Description

Display

The description associated with the selected rule group gets displayed here.

Computation Method

Alphanumeric; 4 Characters; Optional

Specify the computation method to be used for performance fee calculation or select the same from the option list provided. The following options are available in the option list:

Description

Display

The description associated with the computation method selected, gets displayed here.

Performance Fee %

Numeric; 22 Characters; Optional

Specify the percentage of the fund value that needs to be given as the performance fee.

Payment Frequency

Optional

Select the frequency of payment of performance fee from the options provided in the drop-down list:

Accrual Frequency

Optional

Select the frequency of accrual of performance fee from the options provided in the drop-down list:

Next Accrual Date

Date Format; Optional

Specify the date on which the accrual of the performance fee should happen next. You need to specify this value only once during initial fund setup.

For subsequent accruals, this date gets displayed automatically based on the accrual frequency.

Next Payment Date

Date Format; Optional

Specify the date on which the payment of the performance fee should happen next. You need to specify this value only once during initial fund setup.

For subsequent payments, this date gets displayed automatically based on the accrual frequency.

Last Accrual Date

Display

The system automatically displays the date on which performance fee accrual happened last.

Last Payment Date

Display

The system automatically displays the date on which performance fee was paid last.

Hurdle Rate Details

Hurdle rate is the minimum fund returns necessary for a hedge fund manager to start collecting performance fees. The hurdle rate is usually tied to a benchmark rate such as LIBOR.

In this section you can specify details related to hurdle rates used for performance fee calculation. The values you specify here are not applicable for side pocket type of hedge funds.

Hurdle Rate Applicable

Optional

Select the option to indicate whether hurdle rate is applicable for performance fee calculation. Select ‘Yes’ from drop-down list to indicate that hurdle rate needs to be considered for performance fee calculation and ‘No’ to indicate otherwise.

Hurdle Type

Optional

Select the type of hurdle from the options provided in the drop-down list. The following options are available:

Reset Hurdle

Optional

Select ‘Yes’ from the drop-down list to indicate that the hurdle rate needs to be reset and ‘No’ to indicate otherwise. Hurdle rate gets reset if the fund price at the end of the performance fee calculation fee period is greater than the total of High Water Mark and hurdle rate.

Note

This is applicable only for ‘Cumulative’ type of hurdles.

Hurdle Rate Type

Optional

Select the type of hurdle rate from the options provided in the drop-down list. The following options are available:

Hurdle Calculation Method

Optional

Select the method to be used for calculating the hurdle rate. The following options are available in the drop-down list:

Rate Code

Alphanumeric; 10 Characters; Optional

Specify the interest rate code to be used for hurdle rate calculation. You can also select the rate code from the option list provided.

Note

This is applicable only for hurdle rates of type ‘Variable’ or ‘Semi-variable’.

Day Basis

Optional

Select the basis on which the number of days is considered for hurdle rate calculation. The following options are available in the drop-down list:

Rate Basis

Optional

Select the basis on which the hurdle rate is calculated from the following options available in the drop-down list:

Rate

Numeric; 22 Characters; Optional

Specify the value associated with the rate code that is considered for computing the hurdle rate. If you have selected ‘Basis Points’ as rate basis, then a percentage value of this basis point is considered for computing the hurdle rate.

3.1.21.1 Fund Linkage Details Tab

You can indicate the linkages of a fund in this section. You can specify the following details here:

Hedge Fund ID

Alphanumeric; 6 Characters; Mandatory

Specify the fund ID of the linked fund or select the linked fund ID from the option list provided. For master funds, this list will display the list of feeder funds and for fund of funds this list will display the list of underlying funds.

If the hedge fund type is specified as ‘Follow-up Series’, you can specify the fund ID of the related ‘Lead Fund’ here.

Note

For side pocket funds the main fund name is captured here with the percentage specified as blank.

Fund Name

Display

The name of the selected fund gets displayed here.

Percentage

Numeric; 22 Characters; Optional

Specify the percentage to be used for generating the underlying transaction.

Note

For fund of funds the sum of percentage of investment in each fund should not be greater than 100.

Unit Holder ID

Alphanumeric; 12 Characters; Optional

Specify the unit holder ID for generating the underlying transaction.

You can also query for unit holder ID by clicking ‘Find UH’ button.

Note

Unit Holder ID is applicable only for underlying funds in case of Fund.

3.1.21.2 Investor Category Details Tab

In this section, you can override the performance fee percentage details at the investor category level. Click ‘Investor Category Details’ tab to specify these details.

 

Investor Category

Alphanumeric; 12 Characters; Optional

Specify the investor category of the unit holder or select the category from the option list provided. All unit holder categories existing in the system get displayed in the option list.

Investor Category Name

Display

The name associated with the investor category selected gets displayed here.

Performance Fee %

Numeric; 22 Characters; Optional

Specify the percentage of performance fee to be paid for the selected investor category. This value overrides the performance fee percentage specified generically.

3.1.22 Fund Price Currencies Button

If the fund created is a currency of expression fund then you can maintain the fund price currencies along with the general operating and transaction processing limits for each fund price currencies. You can maintain fund price currency by clicking ‘Fund Price Currencies’ button in ‘Fund Rules Details’ screen.

 

You can specify the following details:

Fund ID

Display

The system displays the fund ID for which the fund price currency is being maintained.

Rule Effective Date

Display

The system displays the rule effective date of the fund.

Fund Price Currency

You can maintain the allowed list of currencies for the fund.

Currency Code

Alphanumeric; 3 Characters; Mandatory

Specify the currency code which is added as fund price currency

Currency Description

Display

The system displays the description for the specified currency code.

General Operating Rules

You can maintain the holding amount limit validation for the fund price currency added.

Minimum Holding Amount

Numeric; 18 Characters; Optional

Specify the minimum holding amount.

Transaction Processing Rules

You can maintain the minimum and maximum amount limits for the transaction types for the fund price currency added.

Transaction Type

Alphanumeric; 2 Characters; Optional

Specify the transaction type for which the amount limitations are to be maintained. Alternatively, you can select the transaction type from the option list. The list displays all the valid transaction type maintained in the system.

The system allows the following list of transactions types:

Transfers not allowed as part of this list

Transaction Type Description

Display

The system displays the description for the selected transaction type.

Minimum Amount

Numeric; 18 Characters; Optional

Specify the minimum amount limit for the currency selected.

Maximum Amount

Numeric; 18 Characters; Optional

Specify the maximum amount limit for the currency selected.

Step Amount

Numeric; 18 Characters; Optional

Specify the step amount for the currency.

Initial Min. Transaction Amount

Numeric; 18 Characters; Optional

Specify the minimum initial amount limit.

Initial Max. Transaction Amount

Numeric; 18 Characters; Optional

Specify the maximum initial amount limit.

On saving the fund rule,

During the Pre EOD check, the system will check if the price in fund price currencies are maintained for the day. If the system does not find the Price in currency of expression, then the transaction entered in currency of expression will not be allotted.

3.1.23 Processing Holding Limit in Currency of Expression

The system will validate holding limit for fund price currencies for the outflow transactions only if the limits are maintained in the general operating rules (Fund Price Currency Tab) and accordingly generate warning message for the outflow transactions.

If the transaction base currency is the unit holders’ currency of expression; then TBC should be validated against the Unit Holders’ ‘Holdings/balance’ and the fund’s minimum holdings/balance in that currency of expression to conclude whether or not the minimum holdings/balance amount has been breached.

If the transaction base currency is a fund price currency for the fund, but not a unit holders’ currency of expression, and if limits are maintained for the fund price currency then TBC should be validated against the Unit Holders’ ‘Holdings/balance’ and the Fund’s minimum holdings/balance in FPC to conclude whether or not the minimum holdings amount has been breached.

If the transaction base currency is a Fund price currency for the fund, and limits are not maintained, then the transaction amount is to be converted into the FBC (based on the latest price) and should be validated against the Unit Holders’ ‘Holdings/balance in FBC’ and the Fund’s minimum holdings in FBC to conclude whether or not the minimum holdings/balance Amount has been breached. The system will use COE factor in this case.

If the transaction base currency is FBC; then that amount should be validated against the unit holders “holdings/balance in FBC” and the fund’s minimum holdings in FBC to conclude whether or not the minimum holdings amount has been breached.

If the transaction currency is neither the FBC nor a FPC nor unit holders’ currency of expression, then the amount is to be converted into FBC based on the exchange rate and then validate against the UHs ‘holdings in FBC’ and the fund’s minimum holdings in FBC to conclude whether or not the minimum holdings amount has been breached.

If the transaction currency is neither the FBC nor a FPC nor unit holders’ currency of expression, then the amount is to be converted into FBC based on the exchange rate and then validate against the UHs ‘holdings in FBC’ and the fund’s minimum holdings in FBC to conclude whether or not the minimum holdings amount has been breached. The system will validate holding/balance limit for FPC for all modes of transactions (outflow transaction) i.e. manual inputs and uploads as well.

The UH/CIF balance = UH fund balance * declared NAV in FBC

The Min/Max holding check is maintained in the ‘Fund Price Currency’ tab. The values for “minimum holding indicator, minimum threshold limits and minimum holding apply for” will be looked at what is maintained for fund base currency at the GOR. In case values are not maintained here then it will be same logic as is for fund base currency.

The system will perform the following checks for the different values maintained for minimum holding indicator:

Case 1: Minimum holdings indicator =Amount

Balance to be checked = minimum holding amount + (minimum holding amount * threshold percentage)

If UH/CIF balance is less than or equal to the balance to be checked, then the system will display warning message as ‘The unit holder balance has reached the threshold value’.

If UH/CIF balance is 0 then the system will display warning message as ‘This is a terminating transaction, Unit holder balance will be Zero.’

Case 2: Minimum holdings indicator =lower of amount/units

Balance to be checked = least of minimum holding amount and (minimum holding units * declared NAV in currency of expression) + (least of minimum holding amount and (minimum holding units * declared NAV in currency of expression)) * threshold percentage)

If UH/CIF Balance is less than or equal to balance to be checked then the system will display warning message as ‘The Unit holder balance has reached the threshold value’.

If UH/CIF balance is 0 then the system will display warning message as ‘This is a terminating transaction, Unit holder balance will be Zero.’

Case 3: Minimum holdings indicator = higher of amount/units

Balance to be Checked = higher of minimum holding amount and (minimum holding units * declared NAV in currency of expression) + (higher of minimum holding amount and (minimum holding units * declared NAV in currency of expression)) * threshold percentage)

If UH/CIF Balance is less than or equal to balance to be checked then the system will display warning message as ‘The Unit holder balance has reached the threshold value’.

If UH/CIF balance is 0 then the system will display warning message as ‘This is a terminating transaction, Unit holder balance will be Zero.’

If you try to amend an existing fund or add new currencies (fund price currencies-FPC’s) and prices are not maintained/available for the new fund price currencies and the same currency is used for redemption transactions then system will display warning message while saving the transactions.

3.2 Fund Rules Summary Screen

This section contains the following topics:

3.2.1 Retrieving Record in Fund Rules Summary Screen

You can retrieve a previously entered record in the Summary Screen, as follows:

 

Specify any or all of the following details in the corresponding fields:

Click ‘Search’ button to view the records. All the records with the specified details are retrieved and displayed in the lower portion of the screen.

Note

You can also retrieve the individual record detail from the detail screen by querying in the following manner:

You can perform Edit, Delete, Amend, Authorize, Reverse, Confirm operations by selecting the operation from the Action list. You can also search a record by using a combination of % and alphanumeric value.

Example

You can search the record for Fund ID by using the combination of % and alphanumeric value as follows:

3.2.2 Editing Fund Rules Record

You can modify the details of a Fund Rules record that you have already entered into the system, provided it has not been subsequently authorized. You can perform this operation as follows:

3.2.3 Viewing Fund Rules Record

To view a record that you have previously input, you must retrieve the same in the Fund Rules Summary screen as follows:

3.2.4 Deleting Fund Rules Record

You can delete only unauthorized records in the system. To delete a record that you have previously entered:

3.2.5 Authorizing Fund Rules Record

An unauthorized Fund Rules record must be authorized in the system for it to be processed. To authorize a record:

When a checker authorizes a transaction, details of validation, if any, that were overridden by the maker of the transaction during the Save operation are displayed. If any of these overrides results in an error, the checker must reject the transaction.

Note

You cannot edit or delete an authorized fund rule

You can map agents to a fund, set up backdating limits, and enter transaction prices for a fund only after you authorize it. Similarly, the tracking of limits, and acceptance of unit holder transactions into the fund can only take place after authorization.

You cannot authorize a fund until you have maintained the following fund rules for it:

The following fund rules are not mandatory for a fund, and it can be authorized without them:

These fund rules may be maintained as and when necessary.

3.2.6 Amending Fund Rules Record

After a Fund Rules record is authorized, it can be modified using the Unlock operation from the Action List. To make changes to a record after authorization:

Note

An amendment must be subsequently authorized so that the new rules come into effect on the new rule effective date. You must specify a date that is either the current date or later.

The Fund Name and Fund Short Name cannot be altered for umbrella funds, sub-funds and share class funds, during an amendment.

You will not be able to successfully amend the Specific Fund Price Date Setup if the Rule Effective Date is lesser than the Application Date. While amending, the Rule Effective Date will have to be GREATER than the Application Date.

If required, fund rules may be amended on a business day, with the new Rule Effective Date being the current date itself. This feature is only available if your installation has spe­cifically requested for it. An exhaustive note on this feature is available in the Annexure.

You can amend the following basic details provided no transactions have been accepted for the fund, and provided no fund price has been entered for the fund:

3.2.7 Authorizing Amended Fund Rules Record

An amended Fund Rules record must be authorized for the amendment to be made effective in the system. The authorization of amended records can be done only from Fund Manager Module and Agency Branch module.

The subsequent process of authorization is the same as that for normal transactions.

3.2.8 Copying Attributes

If you want to create a new Fund Rules record with the same attributes of an existing maintenance, you can copy the attributes of an existing Fund Rules record to a new one.

To copy the attributes:

3.3 Fund Investment Components

This section contains the following topics:

3.3.1 Maintaining Fund Investments Component

To validate the Prudential Investment Guidelines it is mandatory to define the various investment components that constitute the fund investment for a product or policy. Investment components are a division of the fund that is allocated for investment in policies. These components may be individual components or a combination of two or more components. Based on the relation of the allotted fund characteristic, these components are allotted a percentage or ratio, which describes the relation of these funds to the total Fund Investment.

Refer the chapter ‘Prudential Investment Guidelines Standard’ and ‘FOREX Compliance’, in the LEP User Manual for more information on maintaining Prudential Investment Guidelines and forex compliance.

To maintain the Fund Investment Components, you need to:

Note

The system does not differentiate onshore /offshore components at this level.

You need to maintain ratios for respective investment components type according to the following considerations:

You can invoke the ‘Fund level Investment Components – Ratio Maintenance Detail’ screen by typing ‘UTDFICRM’ in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button. Select ‘New’ from the Actions menu in the Application tool bar or click new icon to input the details of the fund component.

 

Fund ID

Alphanumeric; 6 Characters; Mandatory

Specify the Fund ID. Alternatively, you can select fund ID from the option list. The list displays a record of all stored fund types.

Fund Level Investment Components-ratio Maintenance

After selecting the required fund types you are provided with the records matching the input information specified to the system.

Component Type

Alphanumeric; 3 Characters; Optional

Specify the component type. This adjoining option list displays all valid component type maintained in the system. You can choose the appropriate one.

Investment Component

Display

The portion of the allocated Fund investment is displayed here as the Investment component.

Percentage

Numeric; 5 Characters; Optional

This is the ratio or percentage of the Total Investment Fund including the selected component. It should be input as 100.

After capturing these details, click ‘Ok’ button to save the component.

3.4 Fund Investment Component Summary Screen

This section contains the following topics:

3.4.1 Retrieving Record in the Fund Investment Component Summary Screen

You can retrieve a previously entered record in the Summary Screen, as follows:

 

Specify any or all of the following details in the corresponding fields:

Click ‘Search’ button to view the records. All the records with the specified details are retrieved and displayed in the lower portion of the screen.

Note

You can also retrieve the individual record detail from the detail screen by querying in the following manner:

You can perform Edit, Delete, Amend, Authorize, Reverse, Confirm operations by selecting the operation from the Action list. You can also search a record by using a combination of % and alphanumeric value.

Example

You can search the record for Fund ID by using the combination of % and alphanumeric value as follows:-

3.4.2 Editing Fund Investment Component Record

You can modify the details of a Fund Investment Component record that you have already entered into the system, provided it has not been subsequently authorized. You can perform this operation as follows:

3.4.3 Viewing Fund Investment Component Record

To view a record that you have previously input, you must retrieve the same in the Fund Investment Component Summary screen as follows:

3.4.4 Deleting a Fund Investment Component Record

You can delete only unauthorized records in the system. To delete a record that you have previously entered:

3.4.5 Authorizing a Fund Investment Component Record

When a checker authorizes a transaction, details of validation, if any, that were overridden by the maker of the transaction during the Save operation are displayed. If any of these overrides results in an error, the checker must reject the transaction.

3.4.6 Amending Fund Investment Component Record

After a Fund Investment Component record is authorized, it can be modified using the Unlock operation from the Action List. To make changes to a record after authorization:

3.4.7 Authorizing Amended Fund Investment Component Record

An amended Fund Investment Component record must be authorized for the amendment to be made effective in the system. The authorization of amended records can be done only from Fund Manager Module and Agency Branch module.

The subsequent process of authorization is the same as that for normal transactions.

3.4.8 Copying Attributes

If you want to create a new Fund Investment Component record with the same attributes of an existing one, you can copy the attributes of an existing Fund Investment Component record to a new one.

To copy the attributes:

3.5 Fund Rule Interface

This section contains the following topics:

3.5.1 Invoking Fund Rule Interface Screen

You can monitor the transfer of funds from AMC to distributor using ‘Fund Rule Interface’ screen. You can invoke this screen by typing ‘UTDFNDRI’ in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button.

 

You can view the following details:

Log Number

Display

The system displays the log number of the fund being transferred.

Fund ID

Display

The system displays the fund ID of the fund which is being transferred.

AMC ID

Display

The system displays the AMC ID of fund from which the fund is getting transferred to distributor.

Distributor ID

Display

The system displays the distributor to which the fund is being transferred.

Operation Type

Display

The system displays the type of operation by which the fund is being transferred.

Maker ID

Display

The system displays the ID of the maker who transfers the fund (saves the fund transfer record).

Maker DT Stamp

Display

The system displays the Date and time when the fund is transferred from AMC to distributor.

3.6 Fund User Restriction

This section contains the following topics:

3.6.1 Invoking Fund User Restriction Screen

You can restrict the user for particular fund using ‘Fund User Restriction’ screen. You can invoke this screen by typing ‘UTDFNDUS’ in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button.

 

You can specify the following details

User ID

Alphanumeric; 6 Characters; Mandatory

Specify the user ID for which the funds are to be restricted for usage. Alternatively, you can select user ID from the option list. The list displays all valid user IDs maintained in the system.

Select Fund ID to Restrict For the User

Fund ID

Alphanumeric; 6 Characters; Mandatory

Specify the fund ID for which the funds are to be restricted for usage. Alternatively, you can select fund ID from the option list. The list displays all valid fund IDs maintained in the system.

Fund Name

Display

The system displays the name of the selected fund ID.