1.2.1 Derivatives Workflow
The various operations and events in the life cycle of a derivatives contract are summarized below:
- Booking, amendment, termination and settlements
- Accounting treatment for life cycle events
- Initial and final exchange of principal (if applicable) and interest schedules
- Assumptions/purchase and assignments/sale of running contracts (trade deals)
- Brokerage Processing
- Revision of floating interest indices and interest accruals
- Revaluation of contracts
- Amortizations – Inception and Termination gains/losses
- Counterparty limit tracking under credit lines
- Exposure tracking under ISDA and other Master agreements
- SWIFT Messaging including multi-party messaging
Parent topic: Features of Derivatives