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Eagle Accounting recognizes a security as a sinking fund bond when you set the security's Sinkable or Sink Flag (tag 1780) option to Yes. When the security master record has the
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Sinkable field set to Yes, the system expects you to populate a sinking fund schedule, both in the Schedule table and in the Corporate Action table.
However, if you expect actual sinking fund payments to change from expected payments, and plan to use custom sinking fund schedules rather than sinking fund schedules, you must also set the security's
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Sinkable (tag 1780) option to Yes. The system then allows you to define a custom sinking fund schedule in the Schedule table and the system, in turn, defines a corresponding sinking fund schedule in the Corporate Action table.
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Set Up Securities
When you establish the SMF, the following options apply to sinking fund securities that use sinking fund schedules or custom sinking fund schedules. For general information on using Reference Data Center to set up securities, see Create and Delete Securities. Otherwise, if you use Issue Viewer to set up securities, see Set Up Securities in Issue Viewer.
You can use the following options when you set up sinking fund securities for use with Eagle Accounting.
Option | Tag | Description |
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Sinkable (formerly Sink Flag) | 1780 | Determines whether the security is eligible for sinking fund payments. Options include:
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Pro Rata Sink | 11304 | Indicates whether the security is a Pro Rata sinking fund. The system uses this option in conjunction with the Sinking Fund Payment Redemptions Gain/Loss Flag field in the accounting basis to determine if the entity/accounting basis and security combination should use the Capitalization method or record cost reduction for sinking fund payments as Gain/Loss or as Accelerated Amortization. Options include Yes and No. For more information, see Set Up Entities for Sinking Funds |
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Add a Custom Sink Schedule
WRITERS NOTE: new section
In the Schedule tab of the Securities workspace, you can add a custom sink schedule for a sinking fund security. For more information about adding schedules in Reference Data Center, see Manage Schedules.
To add a custom sink schedule:
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By default the Source Type box defaults to Gold Copy, but you can create new vendor data by selecting Vendor, and then selecting the corresponding Source.
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When you add a custom sink schedule, the system creates a custom sinking fund schedule in the Schedule table,The schedule has a Schedule Type of CSTMSINK. The system also creates a corresponding custom sinking fund schedule in the Corporate Action table. The sink schedule has a Transaction Type of PMT, a Reason of Custom Sink, and. Corporate Action Notes of CUSTOM_SINK.
Edit a Custom Sink Schedule
In the Schedule tab of the Securities workspace, you can edit a custom sink schedule for a sinking fund security. For more information about editing schedules in Reference Data Center, see Manage Schedules.
To edit a custom sink schedule:
- In Reference Data Center's Reference Desk workspace, click Securities in the left navigation.
You see the Securities workspace with all the available securities. - Select a security, edit the security details and then click the Schedule tab.
- Under Schedules, click the row for the schedule that you want to edit.
Ensure you select a row with a Schedule Sub Type of Custom Sink. - Under Schedule Details, click the row that you want to edit, and then click Override Value.
You see the fields for the selected schedule row, You cannot change the Effective Date or Schedule Sub Type values. The Edit Type list shows a default value of Override. - In the Schedule Amount box, you can change the payment amount.
For a custom sink schedule where the Bypass Sink Check field has a null value, the schedule's Schedule Amount values must add up to 1.0, or 100%. For a custom sink schedule where the Bypass Sink Check field has a Yes value, the system does not require the Schedule Amount values or payments for the custom sink schedule to add up to 1.0, or 100%. - Update the remaining fields as needed, click Apply and Close, and then click Save.
The system saves the revised record to the database.
When you edit a custom sink schedule, the system updates the custom sinking fund schedule in the Schedule table, If you change a schedule amount, the system also updates the corresponding custom sinking fund schedule in the Corporate Action table.
Understand Custom Sink Corporate Action Announcements
WRITERS NOTE: verify if you can create announcement created manual in panel or they'd need a new panel? Verify if you can see the BYpass value onscreen.
Eagle Accounting processes sinking fund payments associated with custom sink schedules based on information in the Corporate Action table.
After you use the Add Schedule panel or procedure to define a custom sink schedule in the Schedule table, Eagle Accounting automatically creates a corresponding custom sink schedule in the Corporate Action table The corporate action record has a a transaction type of PMT,, a Corporate Action Type (tag 1728) value of Custom Sink, and a Corporate Action Notes (tag 1740) value of CUSTOM_SINK. The Corporate Action table also stores the value set for the schedule's Bypass Sink Check option.
When the system populates the Corporate Action table with the Custom Sink payment schedule, it bases the schedule on the percentage sunk. For example, if the Original Issue Amount is $1,000,000 and the Sinking Fund Percentage is .1%, the amount posted is $1,000. If you did not select the Bypass Sink Check option for the custom sink schedule, the entire custom sinking fund schedule must add up to 1 (100%). However, if you selected the Bypass Sink Check option for the custom sink schedule, Eagle Accounting lifts the restriction that the payments must add up to 1.
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The Create Sink Schedule panel allows you to manually add a sink schedule corporate action announcement associated with a sink schedule. You cannot use the corporate action announcement panels to manually add a custom sink schedule corporate action announcement associated with a custom sink schedule. Instead, when you add the custom sink schedule, the system automatically creates a corporate action record for the announcement in the Corporate Action table. You can modify the corporate action announcement as needed. When you need to update the payment amounts for the custom sink schedule, you can override the Schedule Amount values for the schedule. The system then automatically updates the corresponding values in the Corporate Action table . |
Process Custom Sink Payments
In the Global Process workspace's Sink Schedule Processing panel, you can process sinking fund payments globally. Global processing only uses sinking fund values in the Corporate Action table that have a corporate action status of Released.
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