You can initiate retrospective amortization processing by an amortization rule change. Whenever the system finds an amortization rule is found in normal earnings Earnings processing, the system stores the amortization rule Instance is stored on the lot in tag 4256. Each time the system runs the earnings Earnings process is run, the system checks the amortization rule Instance on the lot level (tag 4256) to see if the Instance changed. If the amortization rule Instance changed and the change to the amortization rule could affect the yield result, the earnings Earnings process initiates a retrospective amortization calculation. It sets up the retrospective amortization calculation based on two additional tags:
- Amortization Rule Change Application tag (tag 9007) value on the amortization rule.
- Last earnings retro type (tag 10467) on the lot. Tag 10467 has a value of C (Conversion Date/Settlement Date retrospective amortization calculation) or Null, unless an original retro has been run in the meantime. If an Original retro has been run, the tag's value is O.
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If there is an amortization rule change that only affects some of the lots in a position (because the rule is a lot level override rule), only those lots initiate retro calculations. Earnings accomplishes this by setting the Retrospective Amortization Type to Y for the event on the initial retro calc, so that the rule processes it appropriately, and then sets it back to N before the next lot processes.
For more information about the specific conditions where changes to an amortization rule can affect the yield result, see Understand Yield Recalculation after an Amortization Rule Change.