Overview: Reversals in the Securities Area

Use

The reversal functions enable you to reset flows that have been posted incorrectly.

The procedure you use to reverse an activity depends on the origin of the flow you are reversing. The following functions are available in the securities area:

Reversal function	Flows to be reversed
Transaction Management
·        Reverse the transaction in the operative valuation area ·        Post the reversal in the general ledger for the operative valuation area using the Reverse Documents function. ·        Post the reversal and the recalculated derived flows in the parallel valuation areas using the function Post Reversal/Recalculation.	Purchases and sales Additional flows entered in for transaction (brokerage, commission, other fees, taxes). Accrued interest Interest capitalization flows for zero bonds that result from a sale. Price gains, price losses and adjustment flows that result from a transaction in the operative valuation area. Derived business transactions in the parallel valuation areas have to be reversed, recalculated and then posted again.
Special Functions
·        Reverse Corporate Action	·        Flows that result from a corporate action.
·        Reverse Security Right	·        Flows that were generated by exercising a security right.
·        Reverse Manual Posting / Manual Debit Position	·        Flows generated by the conditions of a security (interest, dividends, bullet repayment) ·        Price gains, price losses and adjustment flows resulting from a bullet repayment. ·        Interest capitalization flows for zero bonds that result from a bullet repayment or a securities account transfer.
·        Reverse Accrual/Deferral	·        Accrual/deferral flows ·        Accrual/deferral reset flows
·        Reverse Securities Account Transfer	You can use this function to reverse the flows that result from a securities account transfer. To access this function, choose Back Office ® Securities Account Management ® Securities Account Transfer ® Reverse.
Position Management
·        Operative Valuation Area
¡        Reverse Valuation	·        Security write-ups ·        Security write-downs ·        Foreign currency write-ups ·        Foreign currency write-downs ·        Write-downs for costs ·        Foreign currency write-downs for costs
¡        Reverse Amortization	·        Interest capitalization flows that result from executing the amortization function.
¡        Reverse Balance Sheet Transfer	·        Flows for the balance sheet transfer.
·        Parallel Valuation Areas
¡        Reverse Key Date Valuation
¡        Reverse Valuation Class Transfer
¡        Reverse Account Assignment Reference Transfer

Prerequisites

The following prerequisites apply for reversals in the operative valuation area, but not to reversals in the parallel valuation areas:

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       1.      If closed flows exist that have a later position value date than the business transaction you want to reverse, you first have to reverse these flows in reverse chronological order.

A closed flow is a flow that was included in a period-end closing run for the same key date as the position value date of the flow, or for a later key date.

You have to reverse the closed flows that affect the positions and securities accounts relating to the business transaction. These are:

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                            a.      Positions for the affected classes in the securities accounts relating to the business transaction.

                            b.      Positions for the affected classes in the securities accounts that are valued together with the securities accounts relating to the business transaction.

You can see whether or not a flow has been closed in the cash flow for the operative valuation area by displaying the flow details (double-click on the line for the flow) and displaying the Technical Data tab page.

This applies to all reversal functions with the exception of accrual/deferral reversals.

       2.      If no closed flows exist, the prerequisites for the individual reversal functions determine whether or not you can reverse a flow. If you cannot reverse a business transaction because of a subsequent flow, you first have to reverse that flow.

Features

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·        If you reverse postings that were generated on the basis of conditions, the actual records are converted back into planned records. All the other actual records that were reversed no longer appear in the cash flow.

You can display the reversed flows in the posting journal for position management (securities). This also displays the CFM-specific reversal reason.

The document header of the FI reversal document displays the original document to which the reversal relates.

·        You have the option of performing the reversal in the subledger only.

We recommend that you only use this function if you need to post a transaction in the securities subledger separately from the posting in the FI general ledger (for example, if the document has already been reversed in FI).

We do not recommend using this function if you want to perform the reversal in the subledger, but do not want to reverse the related flows in Financial Accounting. In this case, the reference to the corresponding FI document is missing in the CFM document when you repeat the posting in the subledger after the reversal.