Fixed-Term Deposits 

Use

The trading of fixed-term deposits (including overnight money and eurocurrency) includes transactions with fixed interest rates and an end of term arranged at the start. This includes the transaction types fixed-term deposit investment and fixed-term deposit borrowing. If the authorized business partners and corresponding payment details are already defined in the standing instructions, the required entries are restricted to the required entries in the structural characteristics. In addition to functions for entering and changing fixed-term deposits, the system also supports functions for rollovers and reversals.

You only have to define the standard interest calculation method and the calendar you want to use once, and these will then be used as default values for the transaction.

Prerequisites

Before you can use the Money Market component, you have to maintain master data. You have to

·        Create your business partners , assign the corresponding roles to these partner and maintain the transaction authorizations.

·        Set up the Standing Instructions   (correspondence, payment details) and release the business partner.

You also have to make the following settings in Customizing:

·        Define the product type   (if you do not want to use one of the standard product types delivered with the system, you can define your own product types). You create financial transactions and manage positions on the basis of product types. A fixed-term deposit is one example of a product type in the Money Market area.

·        Define the transaction type  . Transaction types determine the type of transactions that can be concluded with a particular product type. They also control the transaction and position management process. An example of this is the Investment or Borrowing of fixed-term deposits.

·        Define the Flow Type. These describe the various changes to the cash flows. Example: Increase in the nominal amount

·        You must assign flow types to transaction types.

·        Define the condition type. This setting controls which structural characteristics are displayed when you create transactions. Example: Nominal interest

For more information, see the relevant section in the Implementation Guide.

You can then define Money Market transactions in the SAP R/3 System.

Features

For more detailed information, see Processing Fixed-Term Deposits and Creating Fixed-Term Deposits.