Entity Setup

There is no special entity setup required for SAFE & SAFT trading.

Reference Data

Storage & Configuration

Each SAFE & SAFT security master file (SMF) is modeled as a Right or Warrant. Warrants are typically longer duration than Rights, but the functionality and processing are identical in Eagle Accounting.

Market Data

SAFEs & SAFTs are priced based on market value. Each position is held as a single unit, allowing market values to be applied directly to holdings. If the same SAFE or SAFT is held in multiple portfolios, a different market value and thus SMF is typically required for each portfolio.

Security Data

SAFE & SAFT SMFs can be set up and maintained in Issue Viewer or Reference Data Center (RDC). The lists below capture all required fields.

• Issue Name (961)

• Primary Asset ID (14) & Type (1432)

• Processing Security Type (3931): EQRTXX (Rights) or EQWRXX (Warrants)

• Security Type (82) & Sub Security Type (1464): use these fields to identify your SAFEs & SAFTs vs. other Rights/Warrants

  • These fields are driven by the SECURITY TYPE and SUB SEC TYPE Code Categories respectively

• Price Multiplier (18) = 1.00

• Quantity Scale (19) = 1.00

• Issue Country (1418)

• Asset Currency (85): set to the investment currency

• Expiration Date (38): set to a date far in the future if there is no expiration

• Right/Warrant Type (1142): can be American or European

• Convertible Information: if populated, these fields will be looked up automatically in the Create Right/Warrants Exercise corporate action announcement panel

  • Underlying Security ID (1348): a security representing the future equity or token can be set up and linked as an underlying

  • Exercise Price (67)

  • Conversion Ratio (215)

Trade Processing

Trades are entered using the Book Trade module once the entity and reference data have been configured. Enter the appropriate entity, security identifier, and trade (35)/settle dates (37) and click Submit to query for the security.

Open

Right-click the SAFE or SAFT security and select Open > Buy. The lists below captures all required fields to book a trade.

• Shares (40) = 1.00

• Price Per Share (45): enter the total amount of the investment

• The following fields are available to capture trade fees and taxes:

  • Commission (47)

  • SEC Fee (48)

  • Tax Amount (46)

  • Stamp Duty Tax (51)

  • Other Fee (3752)

• Broker (88): we recommend adding a new value to the BROKER CODES Code Category with short code = NONE and long code = NOT APPLICABLE

Close

Right-click the SAFE or SAFT security and select Close > Sell or BuytoCover. All fields on the close are the same as the open, except Lot Selection Method (27). This defaults to the entity-level election, but can be overridden.

Cancel & Rebook

Faulty SAFE & SAFT transactions can be cancelled and rebooked using the Cancel & Rebook Trade module. Alternatively, trades can be cancelled using Cancel Trade, with the transaction rebooked using the Book Trade module.

Accounting

Once a SAFE or SAFT trade is booked it will be picked up in Eagle’s global workflow. Accounting valuation is calculated when posting unrealized gain/loss, and Data Management valuation is calculated in the STAR to PACE push. These can be scheduled or triggered manually.

• Global Processes (V17)

  • Accounting Valuation: Unrealized Gain Loss Entries > Post Daily Fund Unrealized Gain Loss-Position

  • Data Management Valuation: Eagle STAR to Eagle PACE Direct Processing > Transfer Data - Batch

• Global Process Center (prior to V17)

  • Accounting Valuation: Unrealized Gain Loss Entries > Post Daily Fund Unrealized Gain Loss-Position

  • Data Management Valuation: STAR to PACE Direct Processing > Transfer Data - Batch

Valuation

SAFEs & SAFTs use the standard valuation methodology in Accounting and Data Management. They are represented by a single unit/share and should be priced based on market value.

Exercise

SAFEs & SAFTs are exercised into their underlying using corporate actions. To create one, open Reference Data Center > Corporate Actions > Announcements > Create Rights/Warrants Exercise or Issue Viewer > Corporate Action Announcements > Rights/Warrants Exercise.

• From Asset ID (14): enter the Primary Asset ID of the SAFE or SAFT

• Sweep Date (1197): date when Eagle Accounting’s global corporate action process will pick up the exercise

• Ex Date (65): date when the corporate action takes effect (exercise date)

• Pay Date (1275): date when cash settles

• Treatment Of Fractional Shares (3965) = Post Fractional Shares

• Corporate Action Status (54) = Released

• Corporate Action Sub Priority (3961) = 1

  • Only applicable if multiple corporate actions are being processed for the same day on same security

• Mandatory/Voluntary Indicator (1734) = Mandatory

• To Asset ID (1348): Primary Asset ID of underlying security

  • Looked up automatically based on Underlying Security ID if it was populated on the SMF

• Subscription Price (1705): unit price of the equity shares or tokens being received

  • Looked up automatically based on Exercise Price if it was populated on the SMF

• To Ratio (Shares) (1001): enter the total number of equity shares or tokens being received

  • Looked up automatically based on Conversion Ratio if it was populated on the SMF

• Corporate Action Type (1728) = Rights Exercise

To process the corporate action, use Accounting Center > Processing and Exceptions > Global Processes > Corporate Actions > Rights & Warrants Redemption / Exercise Processing (V17+) or Global Process Center > Corporate Actions Processing > Rights & Warrants Redemption/Exercise (pre-V17). Set Select Query Option to an option that will include the SAFE or SAFT, set Corporate Action Begin Sweep Date (220) and End Sweep Date (221) to a range that includes Sweep Date from the announcement, and submit.

A cash outflow is created equal to To Ratio (Shares) * Subscription Price. The cost of the resulting position is equal to the cash outflow plus the cost of the SAFE or SAFT as shown in the example below.

• SAFE or SAFT Cost = 100,000

• Subscription Price = 3.00

• To Ratio (Shares) = 200,000

• Cash Outflow = 600,000

• Resulting Position Cost = 700,000

Reporting

STAR to PACE (S2P)

Almost all reports in Eagle leverage data from the Warehouse, which is populated by the S2P process. This will be scheduled as part of the daily workflow, but can also be triggered manually as described in the Accounting section.

The S2P process creates a single row for each SAFE & SAFT in the POSITION, POSITION_DETAIL, TRADE, and CASH_ACTIVITY tables. The MARKET_VALUE_INCOME column captures the total market value, inclusive of price fluctuations and period-to-date accruals payable or receivable.

Accounting Reports

Eagle has a core set of accounting reports that can be used to review SAFE & SAFT information. These are designed to support the daily operational workflow for business users, allowing Grid Reports to be easily exported to Excel and customized to provide additional details as needed. Advanced Reports are intended to be client-facing and do not provide the same level of customization.

Data Management Reporting

Performance

The performance toolkit has full functionality to calculate market value-based performance for SAFEs & SAFTs using data supplied by the S2P process. Risk and performance attribution features are available to analyze SAFE & SAFT performance.