1.18.1 Formulae used to compute difference in units

This topic gives instructions on formulae used to compute difference in units.

The formula used to compute difference in units for Subscriptions with transaction mode as amount is as follows:

• Difference Units = Revised Units Allotted – Actual Units Allotted
• Adjusted Units = Difference Units – Adjusted Units (Units adjusted in previous interim run if any)
• If sign of Adjusted Units is Negative (-), then Action for this record needs to be updated as R – Redeem else Action would be S – Subscribe.

The formula used to compute difference in units for Redemptions with transaction mode as amount is as follows:

• Difference Units = Actual Units Allotted - Revised Units Allotted
• Adjusted Units = Difference Units – Adjusted Units (Units adjusted in previous interim run if any)
• If sign of Adjusted Units is Negative (-), then Action for this record needs to be updated as R – Redeem else Action would be S – Subscribe.

The formula used to compute difference in units for Redemptions with transaction mode as Unit is as follows:

• Difference in Settlement Amount = Revised Settlement Amount – Actual Settlement Amount
• Difference Units = Difference in Settlement Amount / Revised Unit Price
• Adjusted Units = Difference Units – Adjusted Units (Units adjusted in previous interim run if any)
• If sign of Adjusted Units is Negative (-), then Action for this record needs to be updated as R – Redeem else Action would be S – Subscribe.

Depending on whether the batch processing is Interim/Year End, the system will generate the allotted subscriptions/redemptions as follows:

• If the Type of Batch Processing is Interim, the system will generate allotted subscriptions/ redemptions for Unitholder ID – Policy – Fund combinations wherever fund balance already exists and mark the status as P – Processed. This interim processing can be more than once per period in such a case we need to eliminate these adjustment trade while correction and readjust the trade accordingly.
• If the Type of Batch Processing is Year End, system would generate subscriptions/ redemptions for Unitholder ID – Policy – Fund combinations wherever fund balance already exists and mark the status as P – Processed. Also system would sum up Diff Units (Net of +ve and –ve values) for Unitholder ID – Policy – Fund combinations having no balances and distribute these units proportionately to existing policies having balances in this fund.

Example: This shows the difference in units of transaction.

22nd Jan 2007 - S1- UH1 - F1 - 1000 ZAR – 100 Units @ 10ZAR

First Interim: On 30th Mar 2007 the price is revised to 10.10 ZAR the transaction would be 1000/10.10 = 99.01 units. Now, the difference is 0.99 units.

Second Interim: On 29th Jun 2007 the price is revised to 10.15 ZAR the transaction would be 1000/10.15 = 98.52 units. Now, the difference 1.48 units but we have already subscribed for 0.99 units hence redeem only for 1.48 -.99  0.49 units.