Basic Customizing for Stock Investments – Part 2

This is the first part is available here

Assign Update Types for Valuation

FSCM-TRM-TM-General Settings-Accounting-Key Date Valuation-Update Types-Assign Update Types for Valuation

Derived Business Transactions Update Types and Usages

FSCM-TRM-TM-General Settings-Accounting-Derived Business Transactions-Update Types-Define Update Types and Assign Usages

Assigned Update Types for Derived Business Transactions

FSCM-TRM-TM-General Settings-Accounting-Derived Business Transactions-Assigned Update Types for Derived Business Transactions

Define Account Assignment References

FSCM-TRM-TM-General Settings-Accounting-Link to Other Accounting Components-Define Account Assignment References

Because we have a difference in accounting treatment for the price gains between our 2 security classifications, we need 2 account assignment references.

Define Account Assignment Reference Determination

FSCM-TRM-TM-General Settings-Accounting-Link to Other Accounting Components-Define Account Assignment Reference Determination (Securities/Listed Derivatives)

Indicate Update Types as Relevant to Posting

FSCM-TRM-TM-General Settings-Accounting-Link to Other Accounting Components-Indicate Update Types as Relevant to Posting

All of the update types created should be made relevant to posting except for DBN_E001 and DBN_E002 which TRM uses internally when calculating gains and losses.

Define Account Determination

FSCM-TRM-TM-General Settings-Accounting-Link to Other Accounting Components-Define Account Determination

Account Symbols

Business Definition	Number	SAP Definition
Equity Investment	1	Position
Cash	3	Bank Clearing
Dividend Income	4.1.4	Dividend Income
Unrealized FX Gain	4.9.4.2	Increase FX
Unrealized FX Loss	4.9.3.2	Decrease FX
Realized FX Gain	4.9.2.1	Realized Gain FX
Realized FX Loss	4.9.1.1	Realized Loss FX
Unrealized Price Gain	4.9.4.4	Increase Titel
Unrealized Price Loss	4.9.3.4	Decrease Titel
Realized Price Gain	4.9.2.2	Realized Gain Titel
Realized Price Loss	4.9.1.2	Realized Loss Titel
Technical Clearing	9.1.3	Technical Clearing
OCI – Unrealized Price Gain	6.1.2.1	Valuation Titel (positive)
OCI – Unrealized Price Loss	6.1.2.2	Valuation Titel (negative)
Commission Fee	4.2.2	Provision/Fee

Posting Specifications

Posting Spec	Description	Debit Symbol	Credit Symbol
11100	Share Purchase	1	3
11200	Share Sale	3	1
11300	Position to Tech Clearing	1	9.1.3
11400	Tech Clearing to Position	9.1.3	1
11500	Tech Clearing to Bank Clearing	9.1.3	3
11600	Bank Clearing to Tech Clearing	3	9.1.3
12100	Realized Price Gain	1	4.9.2.2
12200	Realized Price Loss	4.9.1.2	1
12230	Price loss from unrealized to realized	4.9.1.2	4.9.3.4
12300	Realized FX Gain	1	4.9.2.1
12400	Realized FX Loss	4.9.1.1	1
13200	Dividend Received	3	4.1.4
13500	Tech Clearing to Dividend Income	9.1.3	4.1.4
14300	Fee Payment	4.2.2	3
15100	Price Gain (P/L)	1	4.9.4.4
15200	Reset Price Gain (P/L)	4.9.4.4	1
15230	Price gain from unrealized to realized	4.9.4.4	4.9.2.2
15300	Balance Sheet Revaluation (gain)	1	4.9.4.2
15400	Reset FX Gain	4.9.4.2	1
15430	Move FX gain from unrealized to realized	4.9.4.2	4.9.2.1
15500	Price Loss (P/L)	4.9.3.4	1
15600	Reset Price Loss (P/L)	1	4.9.3.4
15700	Balance Sheet Revaluation (loss)	4.9.3.2	1
15730	Move FX loss from unrealized to realized	4.9.1.1	4.9.3.2
15800	Reset FX Loss	1	4.9.3.2
22310	Move Realized Security Gain from OCI to P/L	6.1.2.1	4.9.2.2
33610	Move Realized Security Loss from P/L to OCI	4.9.1.2	6.1.2.2
23100	Price Gain (OCI)	1	6.1.2.1
23150	Reset Price Gain (OCI)	6.1.2.1	1
23200	Price Loss (OCI)	6.1.2.2	1
23250	Reset Price Loss (OCI)	1	6.1.2.2

Assignment of Update Types to Posting Specs

Update Type	Posting Specification
SE1110	11100
SE2210	11200
SE3303	11100
SE3313	14300
SAM5113	13200
SAM8114	13500
SAM8115	11300
RHT0003	11300
RHT0004	11400
RHT0005	11600
RHT0006	11500
CA0001	No Posting Spec Required
CA0002	No Posting Spec Required
CA0003	No Posting Spec Required
DBN_B001	12100
DBN_B002	12100
DBN_B003	12200
DBN_B004	12200
DBN_B005	12300
DBN_B006	12300
DBN_B007	12400
DBN_B008	12400
DBN_E001	Not relevant to posting
DBN_E002	Not relevant to posting
DBN_E003	15230
DBN_E004	12230
DBN_E005	15430
DBN_E006	15730
DBNOE003	22310
DBNOE004	22610
NV200	15100
NV201	15500
NV202	15300
NV203	15700
NV250	15200
NV251	15600
NV252	15400
NV253	15800
NV200OCI	23100
NV201OCI	23200
NV250OCI	23150
NV251OCI	23250

Assignment of GL account to Account Symbol

Number	AAR	GL Account
1	STOUSGHFT	11310100
3	STOUSGHFT	+++++++++5
4.2.2	STOUSGHFT	73410200
4.1.4	STOUSGHFT	73410100
4.9.1.1	STOUSGHFT	73310603
4.9.2.1	STOUSGHFT	73310603
4.9.1.2	STOUSGHFT	73210201
4.9.2.2	STOUSGHFT	73210201
4.9.3.2	STOUSGHFT	73310503
4.9.4.2	STOUSGHFT	73310503
4.9.3.4	STOUSGHFT	73210101
4.9.4.4	STOUSGHFT	73210101
9.1.3	STOUSGHFT	11119905
1	STOUSGAFS	11310100
3	STOUSGAFS	+++++++++5
4.2.2	STOUSGAFS	73410200
4.1.4	STOUSGAFS	73410100
4.9.1.1	STOUSGAFS	73310603
4.9.2.1	STOUSGAFS	73310603
4.9.1.2	STOUSGAFS	73210201
4.9.2.2	STOUSGAFS	73210201
4.9.3.2	STOUSGAFS	73310503
4.9.4.2	STOUSGAFS	73310503
9.1.3	STOUSGAFS	11119905
6.1.2.1	STOUSGAFS	32320100
6.1.2.2	STOUSGAFS	32320100

Trying it out

For our demonstration, we will use IBM as the issuer and Bank of Montreal as our counterparty and depository bank. Use transaction code BP to enable them in these roles with your company code. The next step is to create a security account. Use transaction TRS_SEC_ACC to create the account.

We also need to create the security we will be trading using FWZZ

At this point, we are ready to enter our first transaction in FTR_CREATE. In the initial screen, we have to specify our company code (1001), transaction type (100-purchase), our counterparty (BMO) and the ID number (IBM_CS).

It is possible to add the commission (expensed or capitalized) directly in the deal by using the “other flows” tab. After saving the deal, we have to settle it in FTR_EDIT as the processing category we selected requires settlement. Once the deal is settled, use TBB1 to post the purchase transaction. Let’s add a manual fee with FWBS.

To be able to fair value our position at month end, we need a closing price. You can use FW17 to enter a price for the security class. Remember that our valuation step requires a closing price. Because we did not configure reset flows for valuation, we need to use the “Mid-Year Valuation with Reset” option in TPM1. Next, let’s pretend IBM declares a dividend of 25 cents per share. We first need to enter a dividend condition on the security class using FWZZ.

Let’s also pretend that we participate in IBM’s DRIP but that they don’t support fractional share ownership. In order to capitalize the dividend, we have to use FWZE and enter the amount and number of shares to capitalize.

Whatever amount is left (3$ in our example) will be expected in the bank sub account. The next business process we will cover is Corporate Actions. Let’s assume IBM announces a 2 for 1 split effective Feb 12th. We must first enter the action using FWK0. We must also activate the action before we can post.

To make the split effective in the sub-ledger, we must post it with FWKB. If you look at our position in TPM12 after posting, the number of units has doubled but the purchase value has not changed.

To finalize this example, let’s sell all of our shares for a big profit. Once the deal is settled and posted with TBB1, we end up with the following entries in the posting journal (TPM20)

Thanks for reading. I hope you have enjoyed this post and that you learned a thing or two in the process.