3.13 Commodity Details Maintenance for a Contract

This topic describes the systematic instruction to capture the commodity details maintenance for a contract.

Murabaha MM contracts that require commodity tracking are processed under products for which you have selected the ‘Commodity Tracking’ option as a preference in the Murabaha Money Market - Preferences screen. For such contracts, commodity tracking becomes mandatory to activate the contract. You can capture the commodity details for a contract using MC Commodity Tracking screen.

1. On the Home page, type MCDCOTRKin the text box, and click the next arrow.

   MC Commodity Tracking screen is displayed.

   Figure 3-5 MC Commodity Tracking

   
2. On the MM Confirmation Rule Maintenance screen, specify the details as required.
   In this screen, by default the following fields are displayed:

   • Contract reference number - the contract for which you have to specify the commodity details
   • Counterparty
   • Event sequence number
   • Operation - When you unlock a contract, this field is populated based on the contract type and the commodity tracking status. For instance, for the contract type ‘Placement’, if the commodity tracking status is ‘Waiting for Offer’, then this field is populated as ‘Offer Acceptance’ and if the commodity tracking status is ‘Offer Received and Accepted’, then it is populated as ‘Closure’. Similarly for the contract type ‘Borrow’, if the commodity tracking status is ‘Offer to be sent’, this field is populated as ‘Sending Offer’ an

   Note:

   You can not change the above details.

   For information on fields, refer to the below table.

   Table 3-4 MM Confirmation Rule Maintenance - Field Description

   Field	Description
   Goods Description	You can describe the goods/commodity being bought. You cannot modify this information if the ‘Commodity Tracking Status’ is ‘Closure’.
   Global Agreement Reference	Specify the agreement reference number associated with the transaction.
   Global Agreement Date	Specify the date of the agreement that you associate with the contract.
   Quantity Units	Specify the unit in which the commodity is measured. You cannot modify this information if the ‘Commodity Tracking Status’ is ‘Closure’.
   Quantity	Specify the quantity to be purchased. You cannot modify this information if the ‘Commodity Tracking Status’ is ‘Closure’.
   Purchase Price	By default, the principal amount of the transaction is displayed as the purchase price of the commodity. You will not be able to change this value. The currency of the purchase amount is also displayed.
   Purchase Unit Price	Based on the quantity of the commodity purchased and the purchase price, the system arrives at the unit price (Purchase Price/Quantity). The currency of the amount is also displayed.
   Sale Price	By default the system displays the sum of principal amount and profit of the transaction. You will not be able to change this value. The currency of the amount is also displayed.
   Sale Unit Price	Based on the quantity of the commodity sold and the sale price, the system arrives at the unit price (Sale Price/Quantity).
   Location	Specify the place of the trade, that is, the place where the sales and purchases of the commodity occurs.
   Counter Party	Specify the name of the counterparty associated with the trade.
   Payment Instructions	Here, you can capture payment instructions for the trade. You cannot modify this information if the ‘Commodity Tracking Status’ is ‘Closure’.
   Title Documents	Specify the documents that should be submitted as part of commodity trading.
   Guarantee Ref	Specify the reference number of the guarantee linked to the contract. The option list will display all valid guarantee contracts (advice of guarantee for placement contracts) that have not already been linked to an Murabaha MM contract. You can associate a guarantee only if the Commodity Tracking Status’ is ‘Closure’. Note: The ‘Commodity Tracking Status’ in the status bar of the Contract Online screen displays the current tracking status of the contract and this varies depending on the contract type, whether ‘Placement’ or ‘Borrowing’, as follows: Table 3-5 For Placements Events Commodity Tracking Status BOOK (Booking a contract) Waiting for Offer OFFR (Offer received and accepted) Offer Received and Accepted GRNT (Receipt of the letter of the guarantee) Closed Table 3-6 For Borrowings Events Commodity Tracking Status BOOK (Booking a contract) Offer to be sent OFFR (Offer received and accepted) Offer sent GRNT (Receipt of the letter of the guarantee) Closed Contracts that require commodity tracking will be initiated or activated only when the status is ‘Closed’. For contracts involving normal products, ‘Commodity Tracking Status’ will be displayed as ‘Not Applicable’. You cannot perform any operation in the ‘Commodity Tracking’ screen when the ‘Commodity Tracking Status’ is ‘Closed’. You can also view the commodity details for a contract by clicking ‘Commodity Tracking’ button in the ‘Contract Online’ screen.