Eagle's Accounting solution provides several ways for you to transfer entity information. An interportfolio transfer (IPT) is the transfer of positions and/or lots from one entity to another entity or entities. An intraportfolio transfer is a transfer within an entity.
About Manual Interportfolio Transfers
In the Run an Interportfolio Transfer panel, you can manually transfer a position and/or lots from a single security from one entity to another entity. After you submit the panel, the system transfers the position and/or lots. In the Run Interest Rate Swap Transfer panel, you can manually transfer an interest rate swap position and/or lots from a single security from one entity to another entity.
Override Non Financial Data on From and To Side Transactions
When you process a manual interportfolio transfer, you can update non financial data such as Broker, Trade Ticket Number, and User Defined Fields. Otherwise, the system logic passes values from the original position/lot detail to the From transactions and to the new To transactions.
However, on taxable transfers, you may need the From and To transaction to have a unique identifier. There are also scenarios where an interportfolio transfer runs at a current market or predetermined price rather than transferring the position/lots at an original or amortized cost value. You can view these types of IPTs as two distinct “transactions” in the market and treat them as such from an accounting perspective. Thus the Run an Interportfolio Transfer panel lets you define a new Trade Ticket Number, User Defined Float value, or Broker on the From and To transactions independently, allowing you to separate the transactions from a recordkeeping perspective.
You can update all, some, or none of these tag values for the From and To transactions, independently. If you do not define a new value in the panel for a From/To broker, trade ticket number, or user defined float field, the existing logic for passing these values on the From and To transactions remains and the system passes values from the original position/lot detail. Only new tag values you enter manually into the panel override historical logic/data.
Be aware that historical logic for Trade Ticket Number (tag 761) is slightly different from that used for the broker or trade ticket number. For manual non-taxable transfers (at amortized or original cost), the Trade Ticket Number value populates on the To transactions but not the From transactions. For manual taxable transfers (at market price), the Trade Ticket Number value does not populate on the To transactions or the From transactions.
Use Manual Interportfolio Transfers with Derivatives
You can use a manual interportfolio transfer to support contract novation for certain types of derivatives when you use the Market transfer method. Contract novation is an act in contract and business law that either replaces a contract obligation with a new one, adds an obligation, or replaces a party to the agreement. It is a legal process of ending a contract between the original trading counterparties and creates two new contracts between the original trading counterparty and the central counterparty. You can use the Run an Interportfolio Transfer panel to transfer a credit default index (CDX) swap using the Market transfer method. Or you can use the Run Interest Rate Swap Transfer panel to transfer an interest rate swap using the Market transfer method. During the transfer, you can modify the clearing broker.
Use Manual Interportfolio Transfers with Ex Interest Securities
When you process an interportfolio transfer for positions that trade ex interest, the system does not determine whether the non market event is in an ex interest period, as it does for market trades. For more information, see About Ex Interest Processing.
About Rule-Based Interportfolio Transfers
You can transfer one security from one entity to one or more entities. Or you can transfer one or more securities from one entity to another entity. You can perform a rule-based interportfolio transfer by first defining a single step or a multi step interportfolio transfer rule with the transfer criteria and then triggering that transfer rule to execute the transfer. If you define an interportfolio transfer rule for a multi basis entity and you want to use different price/transfer methods for the accounting bases, you can use the multi basis transfer rule election panels to identify the price/transfer method to use for each accounting basis during the interportfolio transfer.
