You must define bank account relationships and cash account relationships used for cash segregation before processing transactions for those entities.

Book Manual Trades with Cash Segregation

When you book an Open transaction, you can provide a custodian bank name, custodian bank code, and custody bank account number for use in cash segregation in the custody basis. If you do not provide the custody bank account number for the transaction, you must include the custodian bank code and custody bank account number at a minimum to enable the system to apply the appropriate cash account to the transaction.

If the cash account is missing for a transaction, the system uses the bank account relationships and the cash account relationships in effect for the transaction to assign the appropriate cash account number to the transaction.

It considers the transaction's cash category, cash event type, security type, and long/short indicator, along with its settle currency, and chooses the appropriate cash account relationship with a cash account type of Trade by default.

When you book a Close transaction, the lot selection process is not affected by custodian location, although you may hold the same asset at multiple custodian locations in the same account. A position created by transactions in one custodian location can be closed by transactions from other locations. The transaction location increases or decreases by the appropriate location level quantities.

To book a manual trade with cash segregation:

1. In Accounting Center, in the left navigation pane, click Transactions > Trades > Book Trade/Rebook Trade > Book Trade. 
   You see the Book Trade workspace.

2. Complete the options in the Search Details pane and click Search.
   You see the search results based on the criteria you selected.

3. Select the row with the security you want to trade.  

4. On the Book Trade tab, in the Actions group, click Action Rules, point to Open or Close, and then select the appropriate trade option.
   You see the trade panel.

5. Click the Custodian Bank Name or the Custodian Bank Code and select the name or code of the custodian bank responsible for the trade.
   The field lookups allow you to select the custodians that have bank account relationships defined for the entity or for the composite associated with the entity. When you select a value, the system displays values for the Custody Bank Account Number field, Custody Bank Subaccount field, Cash Account Name field and Cash Account Number field, based on the bank account relationships and cash account relationships that apply to the transaction.

6. Click the Custody Bank Account Number field and select the custodian bank primary account number.
   The panel displays the value associated with the selected bank account relationship for the custodian. In the Custody Bank Subaccount field, the panel displays a value of OTHER as the custodian bank subaccount number for the transaction when you use cash segregation.

7. Click the Cash Account Name field and select the name of the cash account for the custodian.
   The system displays a cash account name based on the cash account relationships that apply to the transaction, but you can override it. It selects the cash account relationship for the transaction based on the transaction's cash account type, currency, and long/short indicator. The lookup displays valid cash account relationships that apply to the transaction. If you use cash segregation, you hold the cash for the trade in this account for the custody basis.

8. Click the Cash Account Number field and select the account number of the cash account for the custodian.
   The system displays a cash account number based on the cash account relationships that apply to the transaction, but you can override it. It selects the cash account relationship for the transaction based on the transaction's cash account type, currency, and long/short indicator. The lookup displays valid cash account relationships that apply to the transaction. If you use cash segregation, you hold the cash for the trade in this account for the custody basis.

9. Complete the remaining options in the panel.

10. Click Submit.
    If the panel cannot determine the cash account, you cannot submit the trade. Or if multiple bank account relationships exist for a given entity, and the panel cannot determine which one to use, you cannot submit the trade.

Settle Transactions with Cash Segregation

After you book trades or corporate actions eligible for cash segregation, you settle those transactions. During processing, the system creates settled cash balances in the custody basis based on the cash accounts assigned to each cash record.

Settle Cash with Cash Matching

When you use cash segregation, you can settle cash based on actual cash settlement. The actual cash settlement method allows you to settle cash based on actual cash settlement for bank settlements sent into the Eagle system from a bank, custodian, or third party.

Eagle Accounting matches inbound cash settlements at the omnibus level, that is, across funds, to individual cash activity across accounting entities and allocates settlements back down to the entities. After it matches bank settlements to open receivables and payables, the system sends the settlements that are successfully matched to the accounting engine for further processing.

The accounting engine then creates settled transaction records at the entity level. When you use cash matching, you can release unmatched settlement records into accounting into a default portfolio of the cash account, where it is allocated to suspense.

You can schedule the Run Cash Auto Match panel to match cash automatically and can use the Cash Matching workspace to match cash manually.

Settle Cash with the Run Multiple Settlements Panel

Eagle's Accounting solution allows you to use the Run Multiple Settlements panel to settle trades. If you use the Run Multiple Settlements panel to settle cash manually, and you select an entity that uses cash segregation, you can limit settlement processing to transactions associated with a single custodian.

The following fields in the Run Multiple Settlements panel allow you to specify a custodian:

• View by Custody Location (tag 990). Indicates whether to list unsettled transactions for all custodians. Options include Yes and No. If you select Yes, you limit your results to a single custody location. A custody location is a custodian bank with a custodian bank account number. If you select No, your results include all custody locations for the entity. This field appears if you select an entity that uses cash segregation.

• Custodian Bank (tag 1146). Specifies a custodian bank with a bank account relationship defined for the entity or the entity's reporting composite. If multiple custodians have bank account relationships with the entity, you can select one custodian. This field appears if you set the View by Custody Location field to a value of Yes.

Process Corporate Actions with Cash Segregation

The system can process both simple corporate actions, such as maturities, and complex corporate actions for entities that use cash segregation. It can generate entitlements (units and cash) by location account and cash account for entities that use cash segregation.

When you define a voluntary corporate action election for an entity that uses cash segregation, the election applies only to holdings at a specified entity/custody location rather than to the overall entity. If you hold a position at more than one custody location for an entity, you can define multiple voluntary corporate action elections for an entity. The following fields in the Add Voluntary Corporate Action Election panel allow you to specify the entity's custody location after you select an entity eligible for cash segregation:

• Custody Bank Name (tag 1146). Specifies the name of the custodian bank associated with a bank account relationship.

• Custody Bank Code (tag 1240). Specifies the code value, or short name, used to identify the custodian bank holding the assets for a bank account relationship.

• Custody Bank Account Number (tag 1660). Specifies the custodian bank account number for the entity that is held in custody for a bank account relationship.

When the system processes global corporate actions for entities that use cash segregation, the corporate action transactions that the system generates for the primary/controlling accounting basis affect the custody basis as well as other secondary accounting bases to which you replicate events.

During global processing, the system assigns the appropriate cash account to the entries created for the custody basis based on the original custodian information used for the open transactions. The custodian location and custodian account number is always the same. However, the system can override the open transaction's cash account if you defined such criteria within the hierarchy of rules defined in bank account relationships and cash account relationships.

When processing cash dividends and coupons, the system can apply cash entitlements at the lot level or the position level. For entities that use cash segregation, the system uses the basis level setting specified in the Cash Div Cash Entitlement Level field and the Coupon Cash Entitlement Level field, which defaults to the position level for a CUST basis.

Post Direct Cash Events with Cash Segregation

Direct cash events affected by cash segregation include cash associated with cash contributions, cash withdrawals, and miscellaneous income and expenses. These direct cash events increase or decrease the overall cash balance of the portfolio. While direct cash events do not affect quantity segregation, they affect the segregated Cash objects in the custody basis.

When you manually enter a direct cash event for an entity with cash segregation, you must identify the custody location. That is, you provide a custodian bank name, custodian bank code, and custody bank account number associated with a bank account relationship for the transaction.

The panel uses the bank account relationship and the cash account relationships in effect for the transaction to assign the appropriate cash account for the custody basis. It chooses the cash account relationship with a cash account type of Trade by default.

When the system automatically generates cash records for these events in the custody basis, it uses the bank account relationship and cash account relationships in effect for the transaction to assign the appropriate cash account to the record using the same hierarchy to apply cash accounts that the system uses during trade processing.

To manually post a direct cash event with cash segregation:

1. From any Eagle window, click the Eagle Navigator button to access the Eagle Navigator.

2. Enter the panel name for the direct cash event in the Start Search text box.
   For example, enter the name of one of the following panels:
   –  Add Cash Contribution
   –  Add Cash Withdrawal
   –  Add Misc. Expense - Position Level
   –  Add Misc. Expense - Asset Specific
   –  Add Misc. Income - Position Level
   –  Add Misc. Income - Asset Specific

3. Click the link the access the panel.
   You see the panel you selected.

4. Complete the fields in the panel.

5. Click the Custodian Bank Name or the Custodian Bank Code and select the name or code of the custodian bank responsible for the transaction.
   You can select a custodian with a bank account relationship defined for the entity or a composite associated with the entity. When you select a value, the system displays values for the Custody Bank Account Number field, Custody Bank Subaccount field, Cash Account Name field and Cash Account Number field, if available, based on the bank account relationships and cash account relationships that apply to the transaction.

6. Click the Custody Bank Account Number field and select the custodian bank primary account number.
   You can select a value associated with the selected bank account relationship for the custodian. In the Custody Bank Subaccount field, you see the custodian bank subaccount number associated with the selected bank account relationship for the custodian. However, you see a value of OTHER as the custodian bank subaccount number for the transaction when the entity uses cash segregation.

7. Click the Cash Account Name field or the Cash Account Number field and select the name or account number of the cash account for the custodian.
   If the entity uses cash segregation, you can select a cash account for a cash account relationship that applies to the selected bank account relationship. The lookup displays cash account relationships that apply to the transaction based on the transaction's cash account type, currency, and long/short indicator. You hold the cash for the transaction in this account for the custody basis.

8. Click Submit.