This page describes two coupon period fields, the Coupon field and the Coupon Type Code field, that you can use when you set up fixed income securities for use with Eagle Accounting.
Coupon
Coupon (tag 70). Specifies Specifies the rate at which the security accrues interest. It is expressed as an accrual rate. A value of zero is required for zero coupon bonds.
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If the value of this field changes after a position exists, provided the Coupon Type is Fixed, the change affect the current and future coupon periods' earnings. Prior coupon periods' earnings are not affected by a change to this field, unless earnings are rolled backed to that period and then rolled forward, or a trade is backdated for a previous coupon period and thus, when earnings roll forward, they pick up the new value when the earnings process runs.
Coupon Type Code
Coupon Type Code (tag 97). Indicates the type of coupon that is associated with the security. The options include Floating Rate (X), Inverse Floating Rate (R), Variable Rate (I), Step Coupon (S), Fixed Rate (F), and Unscheduled Variable Rate (V). This field is required. When Coupon Type is set to X, I, S, F, R, or V, the Coupon field in the SMF (tag 70) is for reference only, because the system does no processing on tag 70.
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The following table compares the coupon types.
Coupon Type | Coupon Code | Definition |
|---|---|---|
Floating | X (see note) | Fixed coupon dates. Variable coupon rate. Coupon rate is calculated off of an index. |
Variable Rate | I (see note) | Fixed coupon dates. Variable coupon rate. |
Step Coupon | S (see note) | Fixed coupon dates. Variable coupon rate. |
Fixed | F | Fixed coupon dates. Fixed coupon rates. |
Unscheduled | V (see note) | Variable coupon periods/Variable coupon rate. Each time a coupon changes, Eagle Accounting drops a coupon. |
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When you set the Coupon Type to Floating (X), Variable Rate (I), Step Coupon (S), or Unscheduled (V), the Coupon field in the SMF (tag 70) is for reference only, because the system does no processing on tag 70. |
The following table compares coupon types on several criteria.
Step Bond | Variable Rate | Floating Rate | Unscheduled Variable Rate | |
|---|---|---|---|---|
Predetermine Coupon Rates | Yes | No | No | No |
Logic to derive Income Dates | Yes | Yes | Yes | No |
Coupon Rate Calculated off an Index | No | No | Yes | No |
Basis Points Adjustment | No | No | Yes | No |
Coupon Rates Can Change | Yes | Yes | Yes | Yes |