...
When you set the entity's Stale Factor Processing field to:
Yes. Stale factor processing occurs when you run factor processing and process paydown/payup transactions. Processing ignores the lot level Stale Factor Processing value but updates it to reflect the current value of the entity level Stale Factor Processing field. The system determines rollback by the Settlement date, orders replay by the Trade date, and creates paydowns with the correct quantity.
No. Stale factor processing does not occur when you run factor processing. Processing ignores the lot level Stale Factor Processing value but updates it to reflect the current value of the entity level Stale Factor Processing field. The system determines rollback by the Settlement date and orders replay by the Trade date.
All activity with the Trade date less than the Paydown date and the Settlement date less than the Paydown date created with a stale factor needs to be rebooked. Paydowns that occur when there is a Close with the Trade date less than the Paydown date and the Settlement date greater than or equal to the Paydown date and have a stale factor do not have the correct quantity until the Close is rebooked with the correct factor. If the Close has the current factor at the time of the paydown, the paydown has the correct quantity.
State Factor Processing Example
...
A trade was bought on 3/8 and settled on 4/4, with a Factor of 1 (a Stale Factor), as shown in the following table.
Option | Value |
|---|---|
Original Face | 1,000,000.00 |
Current Face | 1,000,000.00 |
Factor | 1.0 |
Price | 100.00 |
Principal | 1,000,000.00 |
Coupon | 5%` |
Accrued Interest Bought | 416.67 (1,000,000.00 * 5.00% / 360 * 3 days) |
Net Amount | 1,000,416.67 |
You enter a Factor of .9 on 4/1. When the factor process is run, Eagle Accounting automatically rolls back the original trade and replays it with the correct 4/1 factor of .9.
The trade now appears as shown in the following table.
Option | Value |
|---|---|
Original Face | 1,000,000.00 |
Current Face | 900,000.00 |
Factor | .90 |
Price | 100.00 |
Principal | 900,000.00 |
Coupon | 5% |
Accrued Interest Bought | 375.00 (900,000.00 * 5.00% / 360 * 3 days) |
Net Amount | 900,375.00 |
If the Stale Factor Processing option is not enabled for the entity associated with the trade in Eagle Accounting, you have to manually cancel the original trade when the factor is known, and then manually rebook the new trade using the current factor.
...