Investment pools that are established at institutions, such as universities, are used to manage cash donations or other assets. The revenue earned from the investment of these funds represents a secure and long-term financial source (for research projects or scholarships, for example). If there are many investment pool participants at an institution, they are often grouped in investment pools. Grouping reduces administrative work and its associated costs, and the greater amounts of investment result in higher yields.
But this is only a small part of possible investment pools. For more reffer to wiki.
To have a share in an investment pool, an investment pool participant purchases pool certificates. The pool certificates held by a participant confirm the investment pool share. The value of the investment pool is determined periodically on selected key dates, such as the end of the month. The price for each certificate is also determined. An investment pool participant can only buy or sell certificates on these key dates.
In the Transaction Manager, the investment pool certificates are mapped using securities from the Investment Certificate product category (product type 02A).
Configuration Prerequisites: Basic steps. Detailed description of Security configuration is a matter of other article.
- Activate and configure Public Sector Management Fund and Grant management. Article
- Configure Security product type 02A “Investment certificates”
- Define Company Code-Dependent Settings for the Product Type: (tr. SM30 -> V_TWPB)
- Other required steps
- Assign General Valuation Class:
- Either in tr. TPM89 – Edit Investment Pool Master Data. Set a check mark “Create issues” and you’ll see “Transaction details” group of fields with “Gen.Val.Class Issue” field.
- or Assign General Valuation Class (tr. SM34 -> VC_ATCVC) if you don’t follow First item in this list.
- or badi BADI_TPM_TRANSACTION_TRE, methods FILL_ENDOWMENT_FIELDS / FILL_POOL_FIELDS, field CH_VALUATION_CLASS “General Valuation Class”
- Check if transaction types 100 “Purchase” and 200 “Sale” are created (tr. SM30 -> V_GART2). And create transaction types 300 “Issue: Placement” and 400 “Issue: Repurchase”. Transaction types 300 and 400 are used if you set “Create issues” mark in tr. TPM89 “Edit Investment Pool Master Data”
- Assign Transaction Types for Inv. Pool Participant Transactions (tr. SM30 -> TREV_TRANS_TYPE)
- Define and Assign Position Management Procedure (SM30 -> TRGV_PM_PROC and TRGC_PM_PROC_***)
We’ll need two Position managment procedure. One for pool participants (managed as Asset) and other for fund managers (managed as Liability). Choose the right ones or create new.
- some other steps.
Master data prerequisites:
- Create Fund master data (tr. FM5I)
- Create Grant master data (optional) (tr. GMGRANT)
- We need to create Securities account with the category “Liabilities Securities Account” (tr. TRS_SEC_ACC) – this is our account as fund manager / invesment pool. We will issue security using this security account.
- We need to create several Securities account with the category “Asset security account” (tr. TRS_SEC_ACC) representing accounts of each investor. They will purchase investment pools using this security accounts.
- The investment pool certificate needs to be created as a security in the Investment Certificate category (product type 02A) (tr. FWZZ)
- For security created you need to enter prices (tr. FW17)
Invesment pool management:
The participants and the investment pools are entered in the master data. An investment pool is characterized by its company code and securities ID number. An investment pool participant is characterized by the company code, fund, and grant (optional).
SAP Menu -> Accounting -> Financial Supply Chain Management -> Treasury and Risk Management -> Transaction Manager -> Special Functions from Public Sector -> Investment Pool …
- Master Data:
- Investment Pool Participant: Edit Additional Fund Data (tr. TPM85)
First define Permitted investment pools using company code, fund, grant (optional) and Security created at Master data prerequisites step (ID Number – product type 02A).
If you specify a date under Entry Effective From and Entry Effective To, the investment pool participant can only invest in the pool within this period.
If you only specify a date for Entry Effective From, the investment pool participant can invest in the pool from this date onwards. It is open-ended.
If you only specify a date for Entry Valid To, the investment pool participant can invest in the pool until the specified date.
If you do not specify a date under Entry Valid From or Valid To, the investment pool participant can invest in the pool at any time.
Second, we define and edit additional fund data for investment pool participants. An investment pool participant is represented in the system using the combination of company code, fund, grant (optional parameter) and Investor’s security account. It means we show in what investment pool investor wants to invest.
The business partner defined as the depository bank for this securities account is used as the counterparty of the investment pool participant transaction.
- Edit Investment Pool Master Data (tr. TPM89)
- Indicator Create Issues: Set the indicator Create Issues if you want the system to generate a mirrored investment pool issue transaction at the same time it generates an investment transaction. Liabilities positions are generated for the investment pool which can then be used to map payments from investment pool income to the investment pool participants, for example. If you have not set the indicator, the system generates the investment transactions without the corresponding investment pool issue transaction.
- Decimal places: Enter the number of decimal places to be used when the system generates the investment transactions and the investment pool transactions. A maximum number of five decimal places is permitted.
- Account assignment elements Fund and Grant: The system uses the account assignment elements Fund and Grant to post all the flows belonging to the investment pool to the Public Sector Management component. You must make an entry for the Fund. You only need to enter a Grant if you have activated Grants Management and if you want to differentiate positions in the Transaction Manager by Grant.
- Securities Account: Under Liability Securities Account, specify the securities account to be used for the issue transactions in the investment pool. This securities account position reflects the number of certificates that are issued to the investment pool participants by the investment pool. The system uses the Business Partner specified as the depository bank as the counterparty for the issue transaction.
- Gen.Val.Class: Under Gen.Val.Class Issue, choose the general valuation class valid for the investment pool issue transactions. Based on the general valuation class, the system derives the special valuation classes for the investment pool position for each valuation area. If you didn’t set indicator “Create issues” then you can fill “Gen.Val.Class” using methods from Configuration prerequisites step.
When purchasing investment pool certificates, the system always rounds down. Sales, however, are always rounded up. This ensures the the amount to be invested is never exceeded and the amount to be withdrawn is reached.
Investment pool participant A intends to invest an amount of 500 000 at a rate of 1 100 000 for the pool certificate. The number of units is calculated as 0.45454545454545 recurring. By rounding to three decimal places, 0.45 units are purchased at a value of 495 000, whilst 0.46 units are sold at a value of 506 000. See screenshot in Edit Investments and Generate Transactions for Investment Pool Participants paragraphs.
- Back Office:
The involvement of a participant in an investment pool is mapped in the system by the purchase (transaction type 100) of an investment pool certificate and its mirrored issue (transaction type 300). If there are only a few investment pool participants at an institution, you can enter the corresponding transactions manually. For a greater number of investment pool participants, the transactions can be generated automatically. In this case, you specify for each investment pool participant the amounts that are to be invested in the pools.
- Edit Investments (tr. TPM90)
You can use this function to enter changes to investments made by investment pool participants in one or more investment pools. The system uses the data to automatically generate the required securities transactions in one final processing step. The system maps increased pool investments using certificates purchased (transation type 100) by the investment pool participants and certificates issued (transaction type 300) by the investment pool. A decrease in investment share is mapped using the sale (transaction type 200) of certificates by the investment pool participants and the simultaneous repurchase of certificates (transaction type 400) by the investment pool.
Enter the position number if more than one entry is required for the position value date, investment pool, and investment pool participants combined. This may occur if transactions generated for a particular entry are reversed and new transactions are to be created.
You should use a consecutive number for the position, which is unique for each combination of position value date, investment pool, and investment pool participant.
For existing table entries for which securities transactions were not yet generated, you can change the fields “Payment Amount in Investment Pool Currency” and “Purchase/Sale”. If you want to make changes to one of the other fields, you need to delete the table entry and enter a new one.
For table entries for which the system has already generated securities transactions, the “Transaction Created” field is selected. It is not possible to delete or change these table entries.
- Generate Transactions for Investment Pool Participants (tr. TPM86)
With this function, the system automatically generates transactions for investment pool participants (investors and/or fund managers). These transactions are based on the data that you entered under Edit Investments.
The payment amount defined in the data for each investment pool and investment pool participant is used together with the security price in the system to determine the traded number of investment pool certificates.
Specify the company code and position value date (usually equal to Position Value Date in Edit Investments) for which transactions should be generated. You can use the selection criteria to restrict the transactions to be created.
Enter the transaction calculation date or payment date if it is different to the position value date.
You can simulate the generation of the transactions first by setting the Test Run indicator.
- Reverse Transactions for Investment Pool Participants (tr. TPM87)
Generated transactions can be reversed individually or together:
- Individual Reversal
If you want to reverse only an individual transaction, you can use the reversal function in the Transaction Management area by choosing Start of the navigation path Treasury and Risk Management Next navigation stepTransaction Manager Next navigation stepSecurities Next navigation stepTrading Next navigation step Edit Financial Transaction End of the navigation path.
- Reversal of Multiple Transactions
To reverse multiple transactions, choose Start of the navigation path Treasury and Risk Management Next navigation stepTransaction Manager Next navigation stepSpecial Functions from Public Sector Next navigation stepInvestment Pool Next navigation stepBack Office Next navigation step Reverse Transactions for Investment Pool Participants End of the navigation path (TPM87).
Specify the company code and position value date of the transactions to be reversed, as well as the reason for reversal.
You can use the selection criteria to restrict the transactions to be reversed.
You can use the BAdI Investment Pool Participant Transactions (BADI_TPM_TRANSACTION_TRE) to change the data of the transactions to be created.
IMG -> Financial Supply Chain Management -> Treasury and Risk Management -> Transaction Manager -> Securities -> Transaction Management -> Special Functions from Public Sector -> BAdI: Transactions for Inv. Pool Participants (badi BADI_TPM_TRANSACTION_TRE)
Once the system has generated the investment pool transactions and participant transactions, you can edit them manually (change or reverse them, for example). Make sure that the data remains consistent in the corresponding transactions. You can check this using the overview of transactions of investment pool participants
- Information System:
- Overview of Transactions of Investment Pool Participants (tr. TPM88)
The transactions to be displayed can be restricted using the selection criteria or by using the following three indicators:
- Display Active Transactions
The system displays all the investment pool transactions and participant transactions that have not been reversed.
- Display Inactive Transactions
The system displays transactions for the investment pool and its participants that have been completely reversed.
- Display Transactions to Be Created
The system displays data that you entered using the Edit Investments function (TPM90), but for which transactions have not yet been generated.
The transaction list appears. From this list, you can branch to the individual transactions and you can make overview of all transaction’s parameters.
In addition to the transaction data, you can display other information:
- The symbols for “Transactions Created” and “Transactions Not Created” show whether the transactions already exist or whether they still need to be generated using tr. TPM86. The transactions that have not yet been created are only displayed in the overview list if you have selected the “Display Transactions to Be Created” indicator on the selection screen.
- Differences in Central Data
This field uses the symbols “No Differences” and “Differences Exist” to show whether there are any differences between the transaction for the investment pool participants and the corresponding transaction for the investment pool, with regard to the number of units, price, payment amount, payment currency, activity category, or active status.
Differences may arise from transactions being manually changed or reversed after generation. Such differences need to be checked and eliminated since it is most likely that they have arisen due to incorrect entries during manual processing.
more about Invesment pool help.sap.com
more about Public Sector Management account assignment Fund and Grant reffer to help.sap.com
more about Theory of Investment pool reffer to wiki.