Capitalize

Capitalize

There is a job running every night which creates accrued interest transactions in relation to the bond instruments. The transaction dimension used for this is "AI" for Accrued Interest. The transactions have the label: Accrued interest and key: Default_Payment_Accruals_Instrument in Bricknode Broker. When the instrument is created, you enter when the instrument is to be capitalized. It's only FYI so back office administrators need to keep track of when the accrued interest is to be capitalized.

Navigate to Instruments to capitalize.

Select an instrument and click the action menu and select "Capitalize". 

The instrument chosen is prefilled but can also be changed. 

Fill in the amount of the capitalization and select a date that should be used for including accrued interest transactions.

 If the funds haven't been applied to a Bricknode Broker account, we should select No. Transactions will be made on custody, issuer and customer accounts. 

1. Apply money to custody account.
   Fill in account number or label and available accounts will be visible. (The drop-down menu will be empty until we write something)
   Select trade and settlement date for when we should apply money to the custody account. 
   
   
   
2. Apply money to Bricknode Broker account. (Issuer for the instrument)
   Fill in account number or label on the issuer and available accounts will be visible. (The drop-down menu will be empty until we write something)
   Select trade and settlement date for when we should apply money to the issuer account. 
   
   
   
   
3. Deduct money from Bricknode Broker account (Issuer for the instrument). 
   Fill in account number or label and available accounts will be visible. (The drop-down menu will be empty until we write something)
   Select trade and settlement date for when the money should be distributed to the receivers
   A - Separate transactions will be created on the issuer account if we choose to unmark the checkbox. 
   
   
   
   If we already have made transactions in Bricknode Broker for the funds, for example, used "Deposit Money" on the issuer and custody account we can select Yes. Transactions will only be made on issuer and customer accounts.

   Deduct money from Bricknode Broker account (Issuer for the instrument). 
   Fill in account number or label and available accounts will be visible. (The drop-down menu will be empty until we write something)
   Select trade and settlement date for when the money should be distributed to the receivers.
   A - If this is checked only one transaction for the total amount should be created in the issuer account when the amount is charged. Separate transactions will be created on the issuer account if we choose to unmark the checkbox. 

   

Click Preview  to receive a summary of the distribution. You can always change the information on the left side and click Preview before clicking Confirm. 

Click Confirm when you are satisfied. You will receive a progress bar and a message when it's finished. 

Transactions have now been created in Bricknode Broker, see example below how it looks like in Bricknode Broker when we have created all transactions through the app. (Transactions > Business Transactions). 

For each account summarize the accrued interest and then create a transaction to set the accrued balance to 0 with the same transaction type that was used to create it and then create a new transaction in Trade and one in Settle to establish the real balances. 

The customer has now received the capitalization on the accrued interest.