Example A illustrates the Daily Life-to-Date Calculation, the first Eagle Accounting processing principle.
The security that follows was purchased into entity TaxDemo2, with a Trade Date and Settle Date on 20160401; Par is 1,000,000.00 and it has accrued for 3 days, to 20160404.
The following tables describe the security, entity, and global tax table information used for this example.
| Value | ||||||
|---|---|---|---|---|---|---|---|
Issue Name | FI Issue Tax Type Change | ||||||
Description | FI Issue Tax Type Demo | ||||||
Ticker | FIITTD | ||||||
Primary Asset ID | 555555555 | ||||||
Processing Security Type | DBIBFD | ||||||
Issue Date | 20091015 | ||||||
Dated Date | 20091015 | ||||||
First Coupon Date | 20100415 | ||||||
Last Coupon Date | 20180415 | ||||||
Maturity Date | 20181015 | ||||||
Coupon Type Code | Fixed | ||||||
Coupon Rate | 5.00 | ||||||
Day Count Basis | 30/360 | ||||||
Issue Country | United Kingdom | ||||||
Payment Frequency | Monthly | ||||||
Issue Tax Type | Standard | ||||||
Primary Exchange | London |
Entity Information Option | Value |
|---|---|
Entity ID | TAXDEMO2 |
Portfolio Country | United States |
Amortizing | Constant Yield 2 |
Accrue Tax Indicator | Yes |
Entity Tax Type | MF (Mutual Fund) |
Entity Tax Qualifier | Level 1 |
Global Tax Table Information |
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|---|---|---|---|---|---|---|---|---|---|
Begin Date | End Date | Portfolio Country | Issue Country | Entity Tax Type | Entity Tax Qualifier | Issue Tax Type | Primary Exchange | Tax W/H | Tax Reclaim |
20090101 |
| US | UK | MF | Level 1 | All | ALL | 10.00 | 5.00 |
20090101 |
| US | UK | MF | Level 1 | Standard | London | 7.50 | 2.50 |
20090101 |
| US | UK | MF | Level 1 | Special | ALL | 5.00 | 1.00 |
20090101 |
| US | UK | MF | Level 1 | Special | London | 12.5 | 10.00 |
Now you change the Issue Tax Type from STANDARD to SPECIAL, accrued to 20140405.
Results. In this scenario, Eagle Accounting applies the new applicable Tax Withholding rate and Tax Reclaim rate for the period, and then recalculates the tax withholdings and tax reclaim numbers for the period.
Eagle Accounting can now apply the Tax Withholding rate of 12.5% (from 7.5%), and can apply a Tax Reclaim rate of 10.00% (from 2.5%) for the current coupon period, the next time earnings are run on 20140405. Because you run the accrual on 20140405, the change appears on the general ledger and sub ledger, as of 20140405.
If you want to have this change occur on 20140401 (settlement date of the trade) on the general ledger (assuming accounting periods are open) and sub ledger, you can roll back the earnings to 20140401, and then replay earnings to 20140405.
Note: | You can roll back earnings using the Run Income Accruals panel, located in Global Processes. You must set the Allow Earnings Rollback field (tag 1257) to Yes for Eagle Accounting to rollback earnings. Earnings rollback can only be performed at the "One Entity" level. |
The following table shows the result of local earning values after the issue tax type change.
Trade Date | Acct. Date | Tax W/H Rate | Tax Reclaim Rate | Traded Interest Local | Accrual Delta Local | Tax Expense | Tax Reclaim Amount Local | Tax Reclaim Receivable Delta |
|---|---|---|---|---|---|---|---|---|
Apr 01 2014 | Apr 01 2014 | 7.500 | 2.500 | 23,055.56 | 138.88 | 1,159.72 | 579.86 | 579.86 |
Apr 02 2014 | Apr 02 2014 | 7.500 | 2.500 | 23,055.56 | 138.89 | 1,166.67 | 583.33 | 3.47 |
Apr 03 2014 | Apr 03 2014 | 7.500 | 2.500 | 23,055.56 | 138.89 | 1,173.61 | 586.81 | 3.48 |
Apr 04 2014 | Apr 04 2014 | 7.500 | 2.500 | 23,055.56 | 138.89 | 1,180.56 | 590.28 | 3.47 |
Apr 05 2014 | Apr 05 2014 | 12.500 | 10.000 | 23,055.56 | 138.89 | 593.75 | 2,375.00 | 1,784.72 |
If the accounting periods are not open for 20140404 and you want to roll back and replay earnings, you have the following two options.
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