Procedure

This procedure applies if you are already using the Securities application and want to manage drawable bonds as an additional product.

Create a new flow type for the redemption payment in Customizing for the securities area. Choose Securities → Transaction Management → Flow Types (Transaction) → Define Flow Types (The model Customizing settings contain the flow type 1106 Redemption ). This flow type should have the following settings:

Flow category: TTRA

Calculation category: TTRA

+/- sign for effective interest: -

Eff.int.calc. indicator should be set

Posting control: 1

Incoming payment: 1

Relevant for posting indicator should be set

Create the corresponding condition type for installment repayment. In Customizing choose Securities → Master Data → Product Types → Condition Types → Define Condition Types (The model Customizing settings contain the condition type 262 Installment repayment ).

Enter a number and a descriptive text for the new condition type. Assign the new flow type for installment repayment (flow type 1106) to the condition type in field FTyp1 . Save your entries. Maintain the field selection settings for the condition type. Set the fields listed below as optional fields. You can hide the remaining fields.

Percentage Rate

Condition Amnt

Base Reference

Freq. in months

Calculat. date

Month-End Calc.

Due Date

Month-End Due Date

Condition Form

Pro Rata Temp.

Calendar

Int. calc. method

Immed. settlement

Inclusive ID

Shift Due Date

Calendar Rule

Val. date method

Calendar Rule

Due date method

Create two new condition groups. In Customizing choose Securities → Master Data → Product Types → Condition Types → Define Condition Groups.

Condition group for drawable bonds (the model Customizing settings contain the condition group 44 Drawable Bonds )

Condition group for installment bonds (the model Customizing settings contain the condition group 45 Bonds with Installment Repayment )

Assign condition types to these condition groups. In Customizing choose Securities ® Master Data ® Product Types ® Condition Types ® Assign Condition Types to Condition Groups.

Assign the condition types Interest (Percentage-Quoted) and Repayment rate to the condition group Drawable Bond.

Assign the condition types Interest (Percentage-Quoted) , Repayment rate and Installment repayment to the condition group Bond with Installment Repayment.

When you assign the condition type Installment repayment, you can enter "100" in the Percentage rate field under Basic Data . This ensures 100% redemption when the drawn positions are transferred to the class with installment repayment.

If you make this setting, it is advisable to create a separate product type for "normal" installment bonds. [However, it is also possible to change the predefined repayment rate manually when creating the class data.]

Create the product types Installment bond and Drawable bond. In Customizing choose Securities ® Master Data ® Product Types ® Define Product Types

Start with the product type bond with installment repayment. This product type has the product category 040 Bond . Assign the new condition group Bonds with Installment Repayment to this product type. Make the other product type settings, such as the calculation method, alternative key, and so on.

Assign a number range with external number assignment . The number range interval should match the number range interval for drawable bonds.

Create the product type Drawable Bond. This product type has the product category 040 Drawable Bond . Assign the condition group Drawable Bonds to this product type. Make the other product type settings, such as the calculation method, alternative key, and so on.

Assign a number range with external number assignment . The number range interval should match the number range interval for installment bonds.

In the Drawn Positions section, assign the product type you have already created for installment bonds.

The class for the drawn partial positions is used to transfer the drawn partial positions with the Exercise Security Rights function. The class is created automatically when you save the class data for the drawable bond, and assigned the product type you specify here. When you enter the installment bond, the ID number of the drawable bond also appears as a default entry for the installment bond ID number. You therefore only have to add a letter or number. (Obviously, you cannot use the same ID number for both classes, since the ID number uniquely defines the class in the system.) You can, of course, choose an entirely different ID number, or use internal number assignment to have a number assigned by the system.

You can also enter an Additional text to be used in the description of the class for the partial positions (for example, "drawn"). The system then proposes a default text for the class of the drawn partial positions, consisting of the text for the drawable bond and this additional text.

Assign Repayment type 2 to the product types. In Customizing choose Securities → Master Data → Product Types → Assign Repayment Types to Product Types.

Define a corresponding update type for the new flow type, assign the usage Securities Account Management to this update type, and specify the update type for securities account management. In Customizing, choose Securities → Position Management → Securities Account Management → Update Types.

When you specify the update types for securities account management, you can stipulate the +/- sign for calculating the effective interest rate. This corresponds to the settings for a flow type. In the sample Customizing settings for the flow types, the sign is "+" for payment outflows (such as purchase), and "-" for payment inflows (such as sale or redemption). However, the update types for securities account management have been defined differently. The +/- sign for the effective interest calculation depends on the payment flow generated by the update type. For payment outflows, the sign is "-", and vice versa. You can also make update type settings that differ from the sample Customizing settings. However, you must ensure that your assignments are consistent (in other words, update types with payment flows in the same direction must have the same +/- sign).

Assign the flow type to the update type. In Customizing, choose Securities → Transaction Management → Update Types → Assign Flow Types to Update Types.

Define account determination for the new flow type and update type. In Customizing, choose Transaction Manager → General Settings → Accounting → Link to Other Accounting Components → Define Account Determination. Make settings also under Indicate Update Types as Relevant to Posting .

Make the product type settings for transaction management:

Create a purchase transaction type and a sale transaction type for each new product type. In Customizing choose Securities ® Transaction Management ® Transaction Types ® Define Transaction Types.

Assign the required flow types to the transaction types. In Customizing choose Securities ® Transaction Management ® Flow Types (Transaction) ® Assign Flow Types to Transaction Type.

Make the company code-dependent settings for the product type. In Customizing choose Securities → Master Data → Product Types → Define Company Code-Dependent Settings for the Product Type.

If you want to use the cash management update function, you must also assign cash management planning levels. In Customizing choose Transaction Manager → General Settings → Link to Cash Management → Assign Planning Levels.

You can create classes for redemption schedule sets in Customizing by choosing Securities → Master Data → Specific Class Data → Settings for Special Types of Securities → Drawable Bonds → Define Classes for Redemption Schedule Sets You can use these classes to describe the redemption schedule sets defined in the IMG activity Define Redemption Schedule Sets .

The following classes could be used to indicate the origin of the data in the redemption schedule sets:

OWN 'Own Data'

EXT 'External Data'

Create the names for redemption schedule sets in Customizing by choosing Securities → Master Data → Specific Class Data → Settings for Special Types of Securities → Drawable Bonds → Define Redemption Schedule Sets.

You can use the name for the redemption schedule set to indicate the origin of the redemption schedules in the redemption schedule sets. Possible examples:

Data provider (class 'EXT')

Own estimates (class 'OWN')

Compare your settings with the model Customizing settings.

Depending on your Customizing settings, you may need to make settings in other IMG activities (for example, determination of account assignment reference, assignment of position management procedure, and so on). In doing so, you must ensure that all the product-type dependent settings you have made are also made for the new product types, making different settings for the new product types where you want them to be handled differently.