3. Maintenances and Operations

Before you begin using the Leasing module, you must maintain the following information in the system:

Bank Parameters

These are parameters that you need to specify at the bank level. These will include the following:

Branch Parameters

These are parameters that you need to specify at the branch level. These will include the following:

In addition, you also have to maintain the following:

Check Lists

For different events, you can maintain check lists. You can maintain the checklists based on the combination of event code and product code.

Written down Value (Current Asset value)

You can capture the written down value of an asset linked to a lease account. These will include the following:

Re-computation of insurance amount on changed/ new written down value will be processed during EOD for all accounts. Also, only the latest written down value can be amended

The above maintenances are discussed in the following sections in this chapter:

3.1 Maintaining Bank Parameters

You can maintain the bank parameters in the ‘Lending – Bank Parameters’ screen. You can invoke this screen by typing ‘CLDBKPMT’ in the field at the top right corner of the Application toolbar and clicking on the adjoining arrow button.

Here you can capture the following details:

Bank Code

Specify the code that represents your bank

Include To date for Interest Calc

If you check this option, then accrual entries will be passed from the value date + 1 till the maturity date. However, if this box is not checked, then accrual entries will be passed from the value date till the maturity date - 1.

Amount Blocking for inactive account

Indicate whether an amount block needs to be imposed on an inactive account or not

Split Offset Leg

Check this box if you wish to have split accounting entries for the offset leg of a transaction. For example, if a certain transaction debits a particular GL and credits two different GLs (as in off balance sheet entries), the system will pass two debit entries for the first GL to be in sync with the credit entries to the other GLs. If this option is not checked the accounting entries will be as under:

Dr/Cr

Account

Amount

Dr

00000001

50

Cr

00000011

20

Cr

00000022

30

If this option is checked the accounting entries will be as under:

Dr/Cr

Account

Amount

Dr

00000001

20

Cr

00000011

20

Dr

00000001

30

Cr

00000022

30

Achieve Processed Records from events diary

The parameter Reference Date, Frequency, Unit will be used to archive the processed records in Event Diary

The archival will be done in EOD by batch function. If this parameter is not set then no archive will be done.

Purge Inactive Loans

Specify the tenor in units of days, months and year, for which you want to keep the inactive loans for purging.

Cut off Transactions

Select the Cutoff GL from the option list. Transactions after 2:00 pm on a day will be considered on the next working day. The accounting entries for such transactions will be passed into the Cutoff GL and not the Settlement GL.

3.2 Maintaining Branch Parameters

You can maintain the branch parameters in the ‘Leasing – Branch Parameters’ screen. You can invoke this screen by typing ‘LEDBRPMT’ in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button.

 

Branch parameters include the following:

Branch Code

You have to indicate the code of the branch for which the parameters have to be maintained. The codes of the various branches of your bank are available in the option list provided.

Branch Name

Based on the branch code selected, the branch name is defaulted here.

Process Till Next Working Day – 1

This specification will determine the day on which automatic events such accrual, liquidation etc. falling due on a holiday, should be processed. If you select this option, events scheduled for a holiday will be processed on the last working day before the holiday.

Netting

GL Netting Accrual

Here, you need to indicate the netting preference for posting entries during accrual, liquidation and status change.

GL Netting Liquidation

If you opt to net, the system will post a single consolidated entry for a GL and Currency combination. If you do not select this option, entries are posted individually for each account.

GL Netting Status Change

Check this option to indicate that installment level status change should be done.

Netting of Notices across Accounts

The Netting of Notices across Accounts can be used to indicate that for or all accounts for which the payments falls due on a particular date, the requests for invoice generation should be consolidated.

Auto Allocate Part Payment

Check this option if you want to do a partial payment through auto allocation.

Settlement

The settlement accounts for processing lending transactions have to be specified here. You have to specify the Bridge GL/Account to be used for the settlement of the debit and credit legs of transactions that would be processed at your branch. You can select the accounts from the option lists provided for the same.

Account Auto Generated

You can select this option for automatic generation of account numbers. The system generates the account numbers automatically when you create customer accounts through the ‘Account Details’ screen. If this option is not checked, you have to capture the account number yourself.

Account Mask

Check this box to specify a format/mask for account numbers in order to maintain uniformity in the account numbers generated/captured across a branch. If you specify that account numbers should conform to a specific format, you have to specify the mask in the ‘Account Mask’ field.

User Ref no in Msgs

Check this box to indicate that the User Reference Number provided in the account screen has to be used in Tag 20 of MT103 and Tag 21 of MT202. If the box is unchecked, the loan account number will be used instead of the User Ref no.

Auto Gen User ref

Check this box to indicate that system should auto generate user ref no during account creation.

IRR Processing

Check this option to trigger the YACR (Yield Accrual) event for the branch batch.

Accrual Entries on Holidays

Check this option to determine whether the accrual entries due on the holidays should be passed as of the holiday itself or as on the working day before the holiday(s)/after the holiday(s) depending on the Process Till Next Working Day -1 option.

3.3 Maintaining Check Lists

You can maintain check list for different events using the ‘Check List Maintenance’ screen. The check lists that you maintain here will be validated during the execution of that event for a lease account.

You can invoke this screen by typing ‘CLDCHKMT’ in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button.

The following details have to be captured here:

Product Code

Specify the product code for which you need to maintain a check list. Alternatively, you can also select the product code from the adjoining option-list. All valid loans and leasing products that you have maintained in the system will be available for selection. You can also select the option ‘All’ select all the product codes.

Event Code

Select the event code for which check list items have to be maintained, from the drop down list.

Product Description

The product description is defaulted based on the product selected.

Check List Item

Specify the check list item name that you want to maintain for the selected event. The check list items that you maintain here will be validated by the system during that event, while processing the lease account.

3.4 Maintaining Written Down Value (Current Asset Value)

You can capture the written down value for an asset linked to a lease account using the ‘Leasing Written Down Value’ screen. To invoke this screen, click ‘LEDWDVAL’ in the field at the top right corner of the Application tool bar and click on the adjoining arrow button.

The following details need to be maintained here:

Account

Specify the account for which written down value needs to be captured. Alternatively, you can also select the account number from the adjoining option list. All active financial lease accounts will be available in the list of options.

Written Down Date

Specify the date from which the written down value should become effective. Alternatively, you can also select the date by clicking the adjoining calendar button.

Written down Value

Specify the value for the asset. The value has to be in the same currency as that of the lease account.

Currency

The currency of the lease account number is defaulted here.

Remarks

Here you can capture additional information, if any.

During insurance processing, system computes the insurance premium using the SDE ‘WRITTEN_DOWN_VALUE’. The value for this SDE for a lease account is derived from the maintenance done in the ‘Asset Details’ screen. System picks up the value for the latest effective date and the insurance rate is applied on this value to arrive at insurance premium amount.

3.5 Viewing Written Down Value (Current Asset Value)

You can view the written down value for an asset linked to a lease account using the ‘Leasing Written Down Value Summary’ screen. You can invoke this screen by typing ‘LESWDVAL’ in the field at the top right corner of the Application tool bar and clicking the adjoining arrow button.

You can query on records based on any or all of the following criteria:

Click ‘Search’ button. The system identifies all records satisfying the specified criteria and displays the following details for each one of them: