2.1.5 Shares Characteristics

This topic provides information on shares characteristics button of fund rule screen details.

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.

  1. Click Shares Characteristics tab from the Fund Rules Detail screen.
    The Shares Characteristics screen is displayed.

    Figure 2-3 Shares Characteristics


    Description of Figure 2-3 follows
    Description of "Figure 2-3 Shares Characteristics"

    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.

  2. On Shares Characteristics screen, specify the fields.
    For more information on fields in the screen, refer the below table.

    Table 2-4 Shares Characteristics

    Field Description
    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:

    • Certificate -Option
    • Scrip Based
    • Scrip Less

    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:

    • Designate that certificate issue for the fund is mandatory. This means that certificates must be issued to unit holders for transactions in the fund. To indicate this, choose the Scrip Based option in this field.
    • Designate that certificate issue is not mandatory for the fund. This means that certificates are not required to be issued to unit holders for transactions in the fund. To indicate this, choose the Scrip Less option in this field. If you do so, the fund is a scrip less fund, and you can designate that certificates must be issued only for block transactions, if so needed, by checking the Certificate Required For Block check box in this screen.
    • Designate that certificate issue is to be based on the choice of the investor at the time of transacting. In such a case, certificates will be issued only if the investor specifically requests for certificates at the time of entering into a transaction. To indicate this, select Certificate Option in this field. Such funds are known in the system as certificate option funds.

    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:.

    • Round Up - Choose Round Up to indicate rounding the value at the precision decimal place to the next higher numeral
    • Round Off - Choose Round Off to indicate normal rounding at the precision decimal
    • Round Down - Choose Round Down to indicate truncation of the value at the precision decimal place

    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 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 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.

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

    Table 2-5 Shares Characteristics - Preferences

    Field Description
    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:

    • Daily
    • Bi-Weekly
    • Half Yearly
    • Monthly
    • Quarterly
    • Weekly
    • Yearly

    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.

    Table 2-6 Shares Characteristics - Foreign Investors Limit

    Field Description
    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.

    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.

    Table 2-7 Shares Characteristics - Certificate Details

    Field Description
    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 Numeric; 30 Characters; 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.

Parent topic: Fund Rule