When you use ex interest processing, Eagle Accounting allows coupons to post on ex-date rather than on coupon day. As part of normal accrual processing in Eagle Accounting, coupons typically post on coupon day. However, with ex interest processing, the system can separate the coupon payment from the bond and post on ex-date. You can use ex interest processing with certain securities that require the coupon payment to be separated from the bond and post on ex-date.
If a transaction meets the criteria for ex interest processing and you process accruals on the ex-date of a bond, the system creates a coupon entitlement for each settled lot. That is, any lot that is entitled to the coupon has a traded cash record created for the full coupon that is paid to the current holder of the bond.
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About Ex Interest Processing determine whether to use processing for a given trade perform several setup tasks. You must identify the entities that are eligible for ex interest processing, and you additionally Set Up Entities
For each entity that is eligible for ex interest processing, set the entity's Ex Interest Processing Flag field to Yes. This field is available in the Create/Edit Entity panel, the Create Master Fund panel, and the Edit Master Fund/Sector panel. A description of this option follows.
Option | Tag | Description |
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Ex Interest Processing Flag | 16311 | Indicates whether the system can create coupons for the entity posted on ex-date rather than on coupon day. Options include:
Yes. The entity uses ex interest processing for eligible securities. When for , the system creates . The system uses the security's ex interest schedule or the security's Ex-Interest Days field to determine the ex interest daysNo. Default. The entity does not use ex interest processing. Coupons post on coupon day. is eligible for processing an entity that uses ex interest processingWhen an entity uses ex interest processing, trade processing value. If you manually book a trade for an entity that does not use ex interest processing, the panel resets this default field value from STAR Calculated to CUM after you enter the settlement details in the panel. Otherwise, if you book a trade for an entity that uses ex interest processing, the panel resets the initial field from STAR Calculated to EX or CUM the Ex Interest Processing Flag value for the entity related to the trade to indicate whether the entity associated with the trade can use ex interest processing. Otherwise, no value appears. Options The entity can use ex interest processing to create coupons posted on ex-date rather than on coupon day. If the trade has the Accrued Interest Type field set to STAR Calculated, the to determine the ex-interest days. If an ex interest schedule is unavailable, the system uses the security value - The system uses this information in conjunction with the trade settlement details to assign the trade a CUM or EX value. The entity cannot use ex interest processing.