AC816 Loans Management for Corporates - hservers.org

SAP AG 1999

AC816 Loans Management for Corporates

AC816AC816

Loans Management forCorporatesLoans Management forCorporates

R/3 System

Release 4.6C

Dezember 2000

5004 1951

SAP AG 1999

Copyright 2000 SAP AG. All rights reserved.

Neither this training manual nor any part thereof maybe copied or reproduced in any form or by any means,or translated into another language, without the priorconsent of SAP AG. The information contained in thisdocument is subject to change and supplement without priornotice.

All rights reserved.

Copyright

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SAP AG 1999

Treasury

Treasury Overview

AC030 3 days

Level 2 Level 3

Financial Accountingand Reporting

AC010 5 days

Cash BudgetManagement

AC215 1 day

Basic Functions inTreasury Management

AC810 3 days

Cash Management

AC805 3 days

Money Market, ForeignExchange and Derivatives

AC825 3 days

Loans Management forFinancial Services

AC815 5 days

Loans Management forCorporates

AC816 3 days

Securities Management

AC820 4 days

Market Risk Management

AC830 3 days

SAP AG 1999

AC030 - Treasury Overview

AC810 - Basic Functions inTreasury Management

Course Prerequisites

SAP AG 1999

Target Group

Audience:Project manager

Project team

Duration: 3 days

Notes to the user: The training materials are not teach-yourself programs. They complement the course instructor's explanations.

© SAP AG AC816 1-1

SAP AG 1999

Course goals

Course objectives

Course content

Course overview diagram

Main business scenario

Contents:

Course Overview

© SAP AG AC816 1-2

SAP AG 1999

This course will prepare you to:

Use the functions for loans taken and selectedfunctions for loans given, and make thecorresponding Customizing settings

Outline typical processes for loans taken,including the data transfer to FinancialAccounting and integration with CashManagement

Course Goals

© SAP AG AC816 1-3

SAP AG 1999

Unit 7 Closing Operations

Unit 8 Special Cases

Unit 9 Condition Changes

Unit 10 Master Data

Unit 11 Contract CurrencyChangeover

Unit 12 Overview of LoansGiven

Unit 1 Course Overview

Unit 2 Loans Managementwithin SAP Treasury

Unit 3 Process Flow for LoansTaken

Unit 4 Loan Contract

Unit 5 Disbursement

Unit 6 Payments Due

Preface

Course Content

© SAP AG AC816 1-4

SAP AG 1999

At the conclusion of this course, you will be able to:

Carry out all the steps in the loan process andmake the corresponding system settings

Course Objectives

© SAP AG AC816 1-5

SAP AG 1999

Process flow for loans taken

Loan contract

Payments due

Disbursement

Closing operations

Condition changes

Special casesMaster data

Contract currencychangeover

Overview of loans given

Course overview

Loans managementwithin SAP Treasury

Course Overview Diagram

© SAP AG AC816 1-6

SAP AG 1999

You are using (or have successfully installed) the FIand Treasury Cash Management modules. You nowwant to use SAP Loans Management to enter andmanage loans received by your company, and tocarry out the related accounting tasks.

Main Business Scenario

© SAP AG AC816 2-1

SAP AG 1999

Overview of SAP R/3 Treasury

Role of Loans Management

Loan forms supported

Process flows for loans taken

Interface to Financial Accounting

Datafeed link

Contents:

Loans Management Within SAP Treasury

© SAP AG AC816 2-2

SAP AG 1999

Provide an overview of SAP R/3 Treasury

State the relevant product types

Describe the role of Loans Management withinSAP R/3 Treasury

List the loan forms supported and outline theprocess flows in Loans Management

At the conclusion of this unit, you will be able to:

Loans Management within SAP Treasury:Unit Objectives

© SAP AG AC816 2-3

SAP AG 1999


Process flow for loans taken

Loan contract

Payments due

Disbursement

Closing operations

Condition changes




Course overview

Loans Managementwithin SAPTreasury

© SAP AG AC816 2-4

SAP AG 1999

Before you begin working in the project team youwant to gain an overview of SAP Treasury, inparticular of the Loans Management area.

Which products and processes can be mappedusing Loans Management? What functions areavailable?

Loans Management within SAP Treasury:Business Scenario

© SAP AG AC816 2-5

SAP AG 1999

Financial Accounting

Overview of SAP Treasury

Bank data

Businesspartner

Market data

DownloadMarket Risk Management:• Interest/currency

exposure• Sensitivities• Mark-to-market• Risk analysis/simulation• Value at risk

Cash Management:• Electronic banking• Liquidity status• Integrated operationalsystems

• Control functions

Transaction Management:• Management of financialtransactions and positions

• Transfer to FinancialAccounting

• Flexible reporting andportfolio analysis

• Datafeed interface

DD CC DD CC100100100100

TM/LOTM/LO

SecuritiesSecuritiesDerivativesDerivatives

Money Mkt ForexMoney Mkt Forex LoansLoans

Logistics

The objective of the SAP Treasury module is to ensure efficient liquidity, portfolio and risk management.

SAP Treasury is subdivided into the following areas: Cash Management (CM) offers tools for efficient liquidity analysis. Transaction Management (TM) supports financial transaction and position management. Market Risk Management (MRM) provides methods and procedures for assessing risk positions.

© SAP AG AC816 2-6

SAP AG 1999

MortgageloansBorrower'snote loansPolicy loansOther loans

Fixed-termdepositsDeposits atnoticeCommercialPaper

Product types

DerivativesForexLoansSecuritiesMoney marketStocksSubscriptionrightsInvestmentcertificatesBondsConvertiblebondsWarrant bondsWarrants

Forex spotdealsForwardexchangedealsForex

swaps

Caps / FloorsFRAsSwaps - Interest rate - Cross-curr. int. rate OTC options - Currency - Interest rate - Security - Swaption Futures

Hedging instrumentsInvestment/borrowing instruments

Selection of Financial Instruments

In the short-term, you can use money market or foreign exchange transactions to smooth out liquidity deficits or surpluses. In the medium to long term, securities and loan transactions also come into play.

Derivative financial instruments allow you to hedge against interest-rate and currency risks.

© SAP AG AC816 2-7

SAP AG 1999

Money marketinstruments:

- Fixed-term deposits- Deposits at notice- Commercial Paper

Forexinstruments:

- Spot transactions- Forward transactions- Forex swaps

Loans

Long-termLong-term

InvestmentSecurities

Borrowing BorrowingLoans

Liqu

idity

pos

ition

Planning horizon

DeficitDeficit

SurplusSurplus

Short-termShort-term

Money marketForex

Borrowing

Money marketForex

InvestmentTR-TMTR-TM

TR-TMTR-TM

Short-Term Financial Instruments

© SAP AG AC816 2-8

SAP AG 1999

Loans

Long-termLong-term

InvestmentSecurities

Borrowing BorrowingLoans

Liqu

idity

pos

ition

Securities:

- Stocks- Bonds- ...

Loans:

- Mortgage loans- Borrower's note loans- Policy loans- ...

TR-TMTR-TM

TR-TMTR-TM

Planning horizon

DeficitDeficit

SurplusSurplus

Short-termShort-term

Money marketForex

Borrowing

Money marketForex

Investment

Medium- to Long-Term Financial Instruments

© SAP AG AC816 2-9

SAP AG 1999

Loan Forms Supported

Borrower's note loans

General loans

Policy loans

Mortgage loans

General loans

Mortgage loans

Loans takenLoans given Loans Management

The SAP Loans Management module supports various loan forms:

Mortgage loans: Loans that are linked to a lien upon real property (encumbrance).

Borrower's note loans: Loans based on a borrower's note.

Policy loans: Loans related to a policy (such as a life insurance policy).

General loans: You choose this option for all other forms of loan (for example, loans to employees).

For loans taken the system supports the loan forms "mortgage loan" and "general loan".

© SAP AG AC816 2-10

SAP AG 1999

Integration with R/3 Financial Accounting / TR Cash Management

Master dataMaster data Business partners Credit standing check New business tables Filed documents Collateral Object master data Collateral values

Transaction mgmtTransaction mgmtApplication

Offer Contract

Rollover Process management Transfer postings . . .

Position mgmtPosition mgmt

Evaluations in the Information System

New Loan Transactions: Process Overview

The Loans Management component takes a process-oriented view. You can manage loans at each stage and link them to different master data.

Numerous position management functions are available for loans that have been entered in the system.

The transactions in the Loans Management module are integrated with the R/3 Financial Accounting component and with TR Cash Management.

A range of programs allow you to carry out evaluations according to different criteria.

© SAP AG AC816 2-11

SAP AG 1999


Integration with R/3 FI / TR Cash Management

ContractContractContract offerContract offerApplicationApplication ContractContract

• Mortgage loans• General loans



Possible Procedures for Loan Processing

There are separate menus for each type of loan. These contain the possible steps in the loan process for the type of loan in question.

All forms of loan are integrated with R/3 FI and TR-CM and can be evaluated according to various criteria.

© SAP AG AC816 2-12

SAP AG 1999

Loans Given / Loans Taken

Loans given

Posting viacustomeraccounts

Yes

Yes

No

Yes

Loans taken

Posting withoutcustomeraccounts

The system only supports loans taken processed without customer accounts.

© SAP AG AC816 2-13

SAP AG 1999

Producttypes Contract

ConditionsBusiness

operationsPartner

management

Companycode

Plannedrecords

G/L accoun-

ting

Accts receiv.

Openitems

CashMgmt

Incoming payments

Technical Overview: Loan Processing

* *

*

When you create a loan contract, the system calculates the future cash flows on the basis of the loan data and includes them as planned records in the cash flow display. The flows are posted to the "Treasury subledger for Loans Management". The system then transfers the posting information to the R/3 FI general ledger and FI subledger (accounts receivable), depending on the settings made in Customizing. * Only applies for loans given posted via customer accounts.

© SAP AG AC816 2-14

SAP AG 1999

InterfaceInterfaceInterface

Customer financialaccounting system

Customer Customer financialfinancialaccounting accounting systemsystem

Loans Management

R/3 - Financial Accounting(FI)(FI)- General ledger -

Loans Management - Financial Accounting

Regardless of whether or not you use the R/3 System for financial accounting, the system always transfers the posting data from Loans Management to the R/3 general ledger.

If you are not using R/3 FI, you export the posting data from the R/3 general ledger to your own financial accounting system using a customer-specific interface (extract program).

© SAP AG AC816 2-15

SAP AG 1999

Selection of transactions/flowsto be posted

Loan contract: Cash flowLoan contract: Cash flow05/01/YY05/01/YY 150,000.00 150,000.00 Loan disbursementLoan disbursement 1001100106/30/YY06/30/YY 1,720.83 1,720.83 InterestInterest 1110111006/30/YY06/30/YY 639.05 639.05 Annuity repaymentAnnuity repayment 11251125

FI interface


Integration with FI

Each loan is based on certain transaction data (such as nominal amounts, interests rates), which is used to generate the loan flows, as illustrated above. The loan flows are then used to determine the data required for posting. This data is transferred to the FI interface along with the generated flows that need to be posted. The postings are made online using FI functions.

The posting logic is based on the account assignment reference defined for the loan transaction and the user-definable settings for account determination.

© SAP AG AC816 2-16

SAP AG 1999

SAP R/3 Datafeed provider

Selective refresh

Request

Req

uest

Reply Internet/RFC

TR applications

Informationproviders

Externalinterfaceprogram Datafeed

LogDatafeedserver

Datafeed Architecture

Translationtable

MarketRisk

MgmtSecurities Forex . . .

OperativeSAP tables

Reply

Marketdata

buffer

There are three ways to maintain current market data (such as exchange rates, securities prices, reference interest rates, indexes) in the R/3 System:

Manual entry

Market data file interface This allows you to maintain the relevant data (manually or via a data provider) using a different medium, such as MS Excel, and then import the data into the R/3 System in a compatible format.

Datafeed The datafeed link enables you to make market data available in the system on a real-time basis.

© SAP AG AC816 2-17

SAP AG 1999

TR rolesTR roles

Cash Manager

Trader

Back OfficeProcessor

Staff Accountant

Risk Controller

Credit Analyst

...

TR Administrator

TreasuryManager

Assignactivities

Generatemenus

Role-Based Menus

The following sample roles for Loans Management (SAP_TR_LO) are delivered with the system:

Credit Analyst (credit advisor) CREDIT_ANALYST: Phase leading up to contract conclusion: collateral/objects, collateral value calculation; collateral value proposal; release of collateral value; credit standing check

Loans Officer LOANS_OFFICER: Ongoing business partner and contract management: business partners; entering application data; creating offers; creating contracts; entering disbursements; correspondence; releasing loans

Rollover Officer ROLLOVER_OFFICER: Contract extension: rollover; correspondence

Treasury Staff Accountant for Loans STAFF_ACCOUNTANT: Monitoring postings and payment flows: posting transactions; accrual/deferral; position valuation; accounting reports; reversal; posting/checking incoming payments; clearing postings

Manager of Loans Department DEPARTM_MANAGER: Responsible for position management: release; condition table; reporting

© SAP AG AC816 2-18

SAP AG 1999

Provide an overview of SAP R/3 Treasury

State the relevant product types

Describe the role of Loans Management withinSAP R/3 Treasury

List the loan forms supported and outline theprocess flows in Loans Management

You are now able to:

Loans Management within SAP Treasury:Unit Summary

© SAP AG AC816 3-1

SAP AG 1999

General posting options

Creating a contract

Entering conditions

Cash flow

Contract disbursement

Integration with FI

Payment program for payment requests

Initial interest payments/repayments

Contents:

Process Flow for Loans Taken

© SAP AG AC816 3-2

SAP AG 1999

Provide an overview of the complete loan processfor a general loan, from creating and disbursingthe contract through to the initial interestpayments and repayments


Process Flow for Loans Taken: Unit Objectives

© SAP AG AC816 3-3

SAP AG 1999

Loan contract

Payments due

Disbursement

Closing operations

Condition changes




Course overview

Loans Managementwithin SAPTreasury Process flow for

loans taken


© SAP AG AC816 3-4

SAP AG 1999

Our sample company decides to use SAP R/3Loans Management to enter and manage the loansit receives. It wants to map the transaction processfrom conclusion of the contract through topayment processing for the interest payments andrepayments.

Process Flow for Loans Taken: Business Scenario

© SAP AG AC816 3-5

SAP AG 1999

1. Disbursement: a) "Preliminary posting": Bank clearing to Balance sheet account

b) Bank statement: Bank to Bank clearing

2. Debit position: a) "Preliminary posting": Bal. sheet acct to Bank clearing (payable) Interest expense

b) Bank statement: Bank clearing to Bank

I. Without customer, not using payment program for payment requests

General Posting Options I

If the loan is not managed on the basis of customer accounts, the postings are made directly to G/L accounts (I).

If you do not use customer accounts, the functions for entering payment details are available for payment processing.

© SAP AG AC816 3-6

SAP AG 1999

1. Disbursement a) "Preliminary posting": PR clearing to Balance sheet acct.

b) Payment prog. for PR: Bank clearing to PR clearing

c) Bank statement: Bank to Bank clearing

2. Debit position a) "Preliminary posting": Balance sheet acct to PR clearing (payable) Interest expense

b1) We pay by direct debit:

Bank statement: PR clearing to Bank clearingBank clearing to Bank

or

b2) We pay by bank transfer:

Payment program for PR: PR clearing to Bank clearing

Bank statement: Bank clearing to Bank

II. Without customer account, using payment program for payment requests (PR)

General Posting Options II

If you do not use customer accounts, the functions for entering payment details are available for payment processing. In this case, you can either post the payment "directly" (see I), or use a payment request (see II).

If you use payment requests, the posting logic is the same as for loans managed on the basis of customer accounts, except that the customer account is replaced by a clearing account for payment requests. This account can then be cleared by a payment program (SAPF111).

© SAP AG AC816 3-7

SAP AG 1999

Interest payments / repayments

(Application / Offer)

Contract

Disbursement

General Process Flow

You usually enter the loans you receive in the system after you have concluded a legally-binding loan contract. However, you also have the option of entering applications you have made or offers you have received.

© SAP AG AC816 3-8

SAP AG 1999

Bank statement

Post interest payments/repayments due

Payment program and/or bank statement

(Application / Offer) / Contract

Disburse contract

Process Flow: Example

© SAP AG AC816 3-9

SAP AG 1999

2

1

4Application Transfer to

contract

3Createcontract

Transfer tocontract

Transfer tocontract

Transfer toofferApplication

Offer

Contract - 4 Ways to Enter Contracts in the SAPSystem

Once you have entered a contract and posted the disbursement, the system creates a corresponding loan position in the balance sheet.

You can also map the process leading up to conclusion of the legally-binding contract. You can enter initial loan data in the form of an application. Further details can be added during the offer phase or when you draw up the final version of the contract.

The stages through which a loan must (or can) progress (application, offer, contract) depend on your Customizing settings.

© SAP AG AC816 3-10

SAP AG 1999

ContractContract

ChangeChange

DisburseDisburse

WaiveWaive Full waiver

Partial waiver

DisplayDisplayCreateCreate

ReactivateReactivate

Contract - Functional Overview

© SAP AG AC816 3-11

SAP AG 1999

Create Contract: Initial ScreenCreate Contract: Initial Screen

Company codeLoan numberProduct type

0001/internal/33B

Business partner selectionRole category: Main loan partner

Contract - Initial Screen

E N T E R

A loan (application, offer, contract) is identified uniquely in the system by means of the loan number. The loan number can be assigned externally by the user, or internally by the system, depending on your Customizing settings.

© SAP AG AC816 3-12

SAP AG 1999

Basic dataBasic data ConditionsConditions CollateralCollateral CorrespondenceCorrespondence

Loan typeLoan class (standard loan, interim loan, ...)Contract currency (UNI, EUR, ...)Approval datePurpose of loan (personal loan, building loan, ...)Term (term < 1 year, ...)

Contract - Basic Data

The basic data is used in the following ways:

For information purposes

For reporting evaluations

Delivers values for determining the account assignment reference automatically

The following short forms help to speed up data entry: Date entries: 0 : today +n : today + n days -n: today - n days ++n: today + n months +++n: today + n years Amounts: T or t for thousands, M or m for millions (You can rename the abbreviations T/t and M/m in Customizing.)

© SAP AG AC816 3-13

SAP AG 1999


Condition header:

- Commitment capital- Disbursement rate- Repayment type (instalments, annuity, full repayment upon maturity)- Start of term / end of term- Fixed from / fixed to- Effective interest method (PAngV, Braess, ...)- ...

Contract - Condition Header

The condition header contains the basic condition data for the loan, including:

Start of term / end of term: Term of the loan

Fixed from / fixed to: The period for which the first set of conditions applies. The fixed from / fixed to period can be the same as or shorter than the loan term.

© SAP AG AC816 3-14

SAP AG 1999


Condition items:

For each condition type (fixed nominal interest / instalment repayment /charge, ...):

- Effective from- Percentage rate or amount- Calculation date- Due date- Exact payment form- ...

Contract - Condition Items

You enter the individual conditions as condition items. The calculation date relates to the calculations in financial mathematics. In the case of an interest condition, for instance, this would be the last interest date for the corresponding interest period. The due date refers to the date on which the payment is due. The exact payment form (PE - Payment form with adjustment days) is the combination of the payment form (at the start of the period, mid-period, at the end of the period) and the frequency in months (monthly, quarterly, half-yearly ...). It therefore tells you exactly up to when the amounts have been calculated and when they are due.

You can enter all the data for the condition items manually, or enter certain "initial values" and let the system fill in the remaining fields. To use the latter option, you must specify the commitment capital, the effective period for the condition, the percentage rate or amount, and the exact payment form (or payment form and frequency).

© SAP AG AC816 3-15

SAP AG 1999


Calculate cash flowCalculate cash flow

Due on Settlement amnt100,000.00

1,166.671,333.331,726.672,000.001,691.672,000.001,656.672,000.001,621.672,000.001,551.672,000.001,516.67

2,000.001,481.672,000.00

Curr.UNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNI

05/01/YY06/30/YY06/30/YY09/30/YY09/30/YY12/31/YY12/31/YY03/31/YY+103/31/YY+106/30/YY+106/30/YY+109/30/YY+109/30/YY+112/31/YY+112/31/YY+103/31/YY+203/31/YY+2

Name P

SPPPPPPPPPPPPPPPP

FType10011110112011101120111011201110112011101120111011201110112011101120

L_Loan disbursem.L_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payable

Contract - Cash Flow

On the basis of the conditions belonging to a financial transaction and the specified calculation period, the function modules for financial mathematics for the relevant application (such as stock purchase, swap, loan contract) calculate a series of payment flows for the transaction. This series of flows is referred to as the cash flow.

The cash flow for financial transactions is used as the basis for all trading, transaction management and position management processes, as well as for the evaluation activities within Treasury. Activities based on the cash flow include:

Effective interest calculation

Posting

Accrual and deferral of expenses and revenues.

The cash flow display is linked to the ABAP List Viewer.

© SAP AG AC816 3-16

SAP AG 1999

Exercise: Create Contract

© SAP AG AC816 3-17

SAP AG 1999

Disburse Contract: Basic DataDisburse Contract: Basic DataDisburse Contract: Basic Data

Disbursement basic data

CoCdLoan

Flow typeTextPayment dateIntValDateWithhold. up toPosting control

House bankAccount ID

L_Loan disbursement receivable

Capital dataCurr.cntrct cap.Nominal capitalDisbursement in %Gross pmnt amountNet pmnt amount

Disbursement rate

General loanCiti

000140000000

33B

1001

05/01/YY05/01/YY05/01/YY

100,000.00 UNI 0.00 100.0000 100,000.00 UNI

100.00000

99,900.00

Automatic debit position

Incl.

DBGIRUN

Contract: Disbursement

The entries for the disbursement have the following effects:

Payment date: Disbursement date that is transferred to FI and Cash Management

Interest value date inclusive/exclusive: Interest for the disbursement amount is calculated for the disbursement date / is not calculated for the disbursement date

House bank: The system defaults to the house bank defined in the standing instructions (payment details).

Disbursement in %: Full disbursement or partial disbursement

Net/Gross payment amount: If you have partial disbursements with incidental costs, you must decide whether the incidental costs reduce the disbursement amount (net) or increase the disbursement amount counted towards the calculation capital (gross). (Gross: value-dated amount; net: payment flow) Example: Debit position 100,000 UNI. First partial disbursement 40%. Incidental costs 2,000 UNI. Case 1: Gross pmnt amount 40,000 --> net pmnt amount 38,000; Case 2: Gross pmnt amount 42,000 --> net pmnt amount 40,000. Last partial disbursement 60%, no incidental costs: Gross/net Case 1: 60,000; Case 2: 58,000.

© SAP AG AC816 3-18

SAP AG 1999

Create Disbursement: Incidental CostsCreate Disbursement: Incidental CostsCreate Disbursement: Incidental Costs

Capital amountsAvailable capital Value-dated capital

Flows

Flow Name

CoCdLoan

0001 33B40000000

Due on W/HSettlementamount

Pmnt meth.

100.000,00 100.000,00

6145 05/01/YY 100.00 X Processing charges

......

Disburse Contract: Incidental Costs

If you have to pay disbursement charges (one-time incidental costs), you enter these charges in this screen. In Customizing you define which flow types are permitted. You can withhold the incidental costs that you enter here. This means that they are deducted from the disbursement amount (flag: W/H). Alternatively, you can post the incidental costs separately (W/H flag not set). If you want to trigger the payment yourself later on, you must enter a payment method for processing using the payment program.

© SAP AG AC816 3-19

SAP AG 1999

Disbursement

Save Post (manually)

P

Post manually Post automatically

"Automatic debit position”or"Manual debit position"

"Automatic debit position"

I I

I

Prerequisite: Field: Posting control


Saving/Posting Disbursements

You can either post the disbursement immediately (I = actual record), or save it first (P = planned record) and post it later.

The planned record for a disbursement you have saved can be posted in two ways: By calling up the disbursement data for the loan, you can post the individual record manually. Alternatively, you can let the system post the flow automatically with the mass processing function Post Planned Records. The entry you make in the Posting control field for the disbursement determines the type of posting permitted - manual posting only, or both manual and automatic posting.

© SAP AG AC816 3-20

SAP AG 1999

Bal. sheet acct62120

Bank clearing acct113105

1) 100,000100,000 4)

Other expenses204000

2) 100

100 2) 1) 100,000

4) 99,900

Technical clearing acct194200

100 3)4) 100 3) 100

1) Loan disbursement2) Credit position, incidental costs3) Incidental costs withheld: Outgoing payment4) Incidental costs withheld: Reduction of disbursement (only posted in FI)

Disburse Contract: Posting

Example: Disbursement of a loan with incidental costs

© SAP AG AC816 3-21

SAP AG 1999

Selection of transactions/flows to be posted

Loan contract: Cash flowLoan contract: Cash flow05/01/YY 100,000.00 Loan disbursement 1001 06/30/YY 1,166.67 Interest payable 111006/30/YY 1,333.33 Annuity rep. payable 1125

05/01/YY 100,000.00 Loan disbursement 1001 06/30/YY 1,166.67 Interest payable 111006/30/YY 1,333.33 Annuity rep. payable 1125

FI interface


Integration with FI

When you post the disbursement, the system calls up the interface to Financial Accounting. Before the disbursement posting, no loan data is transferred to FI.

© SAP AG AC816 3-22

SAP AG 1999

Cash flow in contract

Post disbursement


Payment date Settlement amnt Name P FType

05/01/YY 100,000.00 Loan disbursement P 1001


05/01/YY 100,000.00 Loan disbursement I 1001

'Planned record'

'Actualrecord'

Planned Record -> Actual Record

Flows that have been entered but not posted are displayed as P - planned record in the cash flow. Records that have been posted are displayed as I - Actual record.

© SAP AG AC816 3-23

SAP AG 1999

Payment received from the lender

By bank transferor

by check

Bank statement

BANK FileNote topayee

~~~~~~~~~~

BANK

Automatic bank statement Manual bank statement /

Payment Options

If the lender pays by bank transfer or check, you receive the money and the related information with the bank statement from your house bank.

© SAP AG AC816 3-24

SAP AG 1999

Bankstatement

Manualentry

Interimdataset

G/L accountingdocuments

Subledgeraccountingdocuments

Postdirectly

*

Incoming Transfer: Example of a Manual BankStatement

Once the payment appears in the bank statement, the flows for the corresponding account are updated in the system. On the basis of the data entered, the system generates an interim dataset, which then has to be posted. The flows can either be posted directly, or at a later stage using batch input. In the case of loans taken, the postings only affect the general ledger (bank account and bank clearing account). * In the case of loans given that are managed on the basis of customer accounts, postings are also made to the subledger (customer account).

© SAP AG AC816 3-25

SAP AG 1999

5) Bank statement

99,900 5)

Bank account113100



1) 100,000100,000 4)


2) 100

100 2) 1) 100,000

4) 99,900


100 3)4) 100 3) 100

5) 99,900

Disbursement Payment (Bank Transfer): Posting

© SAP AG AC816 3-26

SAP AG 1999

?

totototo

000140000000

Company codeContract numberPartnerProduct type

Up to and includingdue date

x Test runx Log

40 46020 UNIOther lendings

1,333.33 D

40 UNIInterest expenses220000 1,166.67 D

50 113105Bank clearing acct

UNI 2,500.00 C

Pl. rec. selection

Posting control

Automatic Posting: Posting Planned Records

The future flows that have been calculated for a loan must be posted as "due" on the respective dates. The Post Planned Records function allows you to generate the postings in a mass processing run. All of the planned records for the loans selected that are due either on or before the date in the Up to and including due date field are posted.

© SAP AG AC816 3-27

SAP AG 1999

6) Post planned records: Post amounts due (interest payments and repayments) ( P--->I)

99,900 5) Bank account

113100



1) 100,000100,000 4)


2) 100

100 2) 1) 100,000

4) 99,900


100 3)4) 100 3) 100

5) 99,900

6) 1,333

Interest expenses220000

6) 1,167

1,333 6) 1,167 6)

Posting Planned Records Due

© SAP AG AC816 3-28

SAP AG 1999

Payment made to lender

Bank statement Payment program for PR

Bank statement

By bank transfer or

by checkBy direct debit

Payment Options

The processing steps for paying the amounts due depend on the payment method you choose:

If you opt for direct debit, the lender debits the money from your account, and you receive the debit information with the bank statement from your house bank.

If you pay by check or bank transfer, you trigger the payment using the payment run for payment requests. The money is transferred using the payment media generated by the payment program. The account statement data informs you about the outgoing payment.

© SAP AG AC816 3-29

SAP AG 1999

7) Outgoing payment of due amounts (for example, by direct debit)

2,500 7)

Bank account113100


1) 100,000


2) 100


100 3)4) 100

6) 99,900

6) 1,333

Interest expenses220000

6) 1,167

99,900 5)


100,000 4)100 2) 1) 100,000

4) 99,900 3) 100

1,333 6)

1,167 6)

7) 2,500

Outgoing Payments

© SAP AG AC816 3-30

SAP AG 1999

Provide an overview of the complete loan processfor a general loan, from creating and disbursingthe contract through to the initial interestpayments and repayments


Process Flow for Loans Taken: Unit Summary

© SAP AG AC816 3-31

Process Flow Exercises

Unit: Process Flow

After completing these exercises, you will be able to:

• Enter a transaction

You are taking out a loan with Deutsche Bank and want to enter the contract, the agreed conditions and related information in the system.

1 You are taking out a general loan with your house bank. Create a contract for a general loan in your company code TRXX (XX = group ID). Your business partner is the existing partner Deutsche Bank (DEUBA) in the role of "Main lender".

1-1 Enter the basic data for the loan:

• Term: 5 years

• Corresponding commitment date

1-2 Enter the loan conditions. Condition header:

• Commitment capital: 100,000 UNI

• Disbursement rate: 100%

• Repayment in instalments

• Fixed for 5 years

• End of term in 5 years

© SAP AG AC816 3-32

Individual condition items:

• Nominal interest rate: 5.75 %

• Exact payment frequency: Every 12 months, payable at the end of the year

• Instalment payments: Annual instalment payments, payable at the end of the year, instalment calculated by the system

• You want the instalment payments to be settled immediately .

• An administration charge of 200 UNI is due at the end of each year.

Look at the cash flow generated on the basis of the conditions.

Save your loan and make a note of the loan number assigned by the system.

© SAP AG AC816 3-33

Process Flow Solutions

Unit: Process Flow

• Entering a transaction

• Integration with Cash Management

1 Entering a loan contract:

→ Accounting → Treasury → Loans → Transaction Management → General Loan → Contract → Create

Field name or data type Values

Company code TRXX

Product type 33B

You do not need to enter a loan number. This number is assigned internally by the system.

© SAP AG AC816 4-1

SAP AG 1999

Creating a contract

Customizing:

- Loans and Financial Accounting- Business partners- Product types- Flow types- Conditions

Contents:

Loan Contract

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SAP AG 1999

Enter loans taken with different condition structurevariants (such as fixed interest, variable interest, orsuspended repayment)

Make the system settings for the product types yourequire and the corresponding conditions


Loan Contract: Unit Objectives

© SAP AG AC816 4-3

SAP AG 1999

Payments due

Disbursement

Closing operations

Condition changes




Course overview


loans taken

Loan contract


© SAP AG AC816 4-4

SAP AG 1999

Our sample company wants to take out a generalloan with customer-specific conditions.

We need to make Customizing settings that allowfor different condition structures.

Loan Contract: Business Scenario

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SAP AG 1999

General Customizing Settings:

1. Enterprise Structure

2. Financial Accounting

3. Treasury

Loans Management

Configuration Levels

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SAP AG 1999

Implementation Guide for R/3 Customizing (IMG)

Enterprise Structure

Financial AccountingDefine, Copy, Delete, Check Company Code :

Company code 0001Company name Group 01

Language

_

_

_ Definition_

City WalldorfCountry DECurrency UNI

Enterprise Structure Settings

A company code (FI) is the smallest organizational unit for which a complete, self-contained set of accounts can be drawn up for external reporting. The company code is the unit for which you record all the posting activities and generate all the documents for financial statements (balance sheet, profit and loss account).

In Loans Management you always create a loan in a company code.

© SAP AG AC816 4-7

SAP AG 1999


Financial Accounting Global SettingsFinancial Accounting

Company code

_

_

+

_

_

+

+

Enter Global Parameters

Company codeChart of accts...Max. exchange rate deviation

0001

INT

10%

Fiscal year variant...Financial Assets Mgmt active

K4

Financial Accounting Settings

In this step you make general settings, such as the chart of accounts to be used for the company code and the fiscal year variant.

If you want to use the Loans component, you need to flag the Financial Assets Mgmt active field.

© SAP AG AC816 4-8

SAP AG 1999

_

Treasury

Basic Functions

__


+++

Organization

+

___ Treasury Management

_

_

Define Company Code Additional Data

_

Company code

0001

1

Calendar...Reg. rep. active Ident. no. ID 5

01

Treasury Settings (1)

For each company code you can maintain specific data for the Treasury area.

The calendar you enter here is used for the working day check for the following:

Disbursement

Entering business operations

Incidental costs (manual posting)

Manual changes to flows in the cash flow

© SAP AG AC816 4-9

SAP AG 1999

_

Treasury

Loan

__


+++

Basic Settings

+

___ Treasury Management

_

Installation Parameters

_

Contract curr.Word process.Archiv. install.

UNI

SAPSCRIPT

x

Treasury Settings (2)

You make the general settings for Loans Management in the Loans section of Customizing under Basic Settings.

If you want to use the optical archive for loan correspondence, select the Archiv. install. indicator.

© SAP AG AC816 4-10

SAP AG 1999

Transaction Management Portfolio / Accounting

- Create loan- Business partners- Conditions

Appli- Offer Appli- Offer Contract Disburse-Disburse- Other Other RolloverRollover cation ment activ. cation ment activ.

Mortgage Loan - Process Flow / Contract

© SAP AG AC816 4-11

SAP AG 1999

ContractContract

Change

CreateCreate Display

Mortgage loan General loan

Creating a Contract

The product categories "mortgage loan" and "general loan" are supported for loans taken.

© SAP AG AC816 4-12

SAP AG 1999

Create Contract: Initial ScreenCreate Contract: Initial Screen


0001/internal/33B


Loan - Initial Screen

E N T E R

A loan (application, offer, contract) is identified uniquely in the system by means of the loan number. The loan number can be assigned externally by the user, or internally by the system, depending on your Customizing settings.

When you create a contract, you must specify the company code, the product type and (if you are using external number assignment) the loan number. You then enter the loan partner.

© SAP AG AC816 4-13

SAP AG 1999

APPLICATION LEVEL

ProductProductcategorycategory

Flow categoryFlow category Calculation cat.Calculation cat.

Condition typeCondition type

SYSTEM LEVEL

Status cat.Status cat.

Product typeProduct type Condition groupCondition group

Status definitions/Status definitions/status transfersstatus transfers

Flow typeFlow type

Customizing Structure: Loans

Product cat.Product cat.

Product categories used to classify the various financial investment and borrowing instruments. They are predefined in the system and apply for all company codes. Product categories cannot be modified by the user.

Product types represent a refinement of product categories at user level and, unlike product categories, can be defined by the user. When you define a product type, you specify the framework for financial instruments of this product type. A product type can only be assigned to one product category. However, several product types may be assigned to the same product category. You create and process your individual financial transactions on the basis of product types.

The following activities are dependent on the product type:

Assignment of different processing methods

Selections for reporting

Assignment of different structure characteristics

Definition of yield curves in Market Risk Management

Example: Product category "mortgage loan"; product type 1 "Fixed-rate mortgage loan", product type 2 "variable-rate mortgage loan". Since both product types belong to the same product category, the system processes them in the same way. The subdivision might be used for reporting purposes, for example.

© SAP AG AC816 4-14

SAP AG 1999

Product type 33B

Short text G.loan.tkn

Order mgmt

Long text General loan taken

Collateral activeObjects activeUser exit active

Loan master data

Borrower's note: Purchase/sale

Customizing: Defining Product Types

Prod. categoryAssets/Liab.

3001

Int. per disb.504Condition group Price gain

301Limit group

a

Properties

a

You make the following general settings for the product type (settings which apply for all company codes):

Product category: Controls how the system processes the loan in the background.

Assets / Liabilities: Loans given / loans taken (received)

Condition group: The condition group determines which conditions the user is allowed to enter for loans of this product type.

Limit group: The limit group determines the limit product group to which amounts from loans in this product type are assigned for limit management.

Interest per disbursement: If several partial disbursements are entered in the same interest period, the system either generates a nominal interest flow for each partial disbursement (indicator set) or calculates the nominal interest flow for the cumulative amount (balance method, flag not set). Example: See F1 Help

Price gain: If this indicator is set, you can make a net posting instead of a gross posting. This field is relevant for borrower's note loans.

Order management: For each borrower's note product type you can define whether the borrower's notes should be processed using the order management functions or in the same way as a "standard loan".

Collateral/objects/user exit active: For each product type you can specify whether the tabs for entering collateral and/or object data should appear when a loan is created (the field Objects active is only relevant for the product category "mortgage loan").

© SAP AG AC816 4-15

SAP AG 1999

Exercise: Defining Product Types

© SAP AG AC816 4-16

SAP AG 1999

Loan no. 10000007 Number assignment for loans

Simple numberassignment

With numbercomposition

I. II.

Loan Number

The numbers for loans (application, offer, contract) can either be specified by the person who enters the loan (external), or assigned by the system according to certain rules (internal).

If you use simple number assignment, the system assigns the loan numbers sequentially from a predefined number interval. If you use number composition, you can determine the components and the exact structure of the loan number yourself.

© SAP AG AC816 4-17

SAP AG 1999

-> Product Types -> Loan Numbers -> Loan Number

-> Product Types -> Loan Numbers -> Define Number Components-> Assign Number Components

to Product Type_ _ _ _ _ _ _ _ _ _ _ _ _

Component 1 Component 2 ...

Internal / external / in conjunction with an object or file

I.

II.

Customizing: Number Range for Loan Numbers

10000000No. From number To number Current number01

Ext19999999 10000005

If you use simple internal number assignment, the number range must be numerical. If you use number composition or external number assignment, you can assign alphanumeric loan numbers.

A special user exit is available for applying a check digit procedure to the number composition. The name of the corresponding module pool is SAPFF67N.

© SAP AG AC816 4-18

SAP AG 1999

Product Types -> Company Code-Dependent Settings for Product Type

PTyp Text Prod.cat. Cond. group

30A Mortgage loan given 300 1

30B Mortgage loan taken 300 504

31A Borrower's note loan 310 2

33A General loan given 330 4 33B General loan taken 330 504...

"Double-click” "Double-click” for detailedfor detailedinformationinformation see

following slides

Customizing: Product Types

© SAP AG AC816 4-19

SAP AG 1999

Product Types -> Company Code-Dependent Settings for Product Type - Details

Company codeProduct typeProd. category

Condition group

0001

300504

Dunning block

01

CM period 4FI posting 4 Actual record in Treasury, posting in FI without customer

No. status 10000088Number range

A

33B General loan taken

Ref. management 2

No. char.MUSample recNoRg

Dunning activeDec. activePmt form startPrice gains w/o prop. gains fr. def. WB

Payment details

Rev. level IP

x

Number range

Basic settings

Indicators

Reversal

Customizing: Product Types / Details (1)

© SAP AG AC816 4-20

SAP AG 1999

Product Types -> Company Code-Dependent Settings for Product Type - Details

Company codeProduct typeProd. categoryCondition group

0001

300504

Default values

Plan/Act. pr.Posting system 0

Eff. int. method 1Alt. eff. int. mth 4Int. calc. method 1

0Int.VDate incl.

PAngVMoosmüller360E/360

Disc. determin.

Pmnt block IPPmnt block OI

Payment method

1

33B General loan taken

Currency UNI

IPD control

Pmnt summariz.Incoming pmnt

Withhold. disb.

Dis. accr./defer. 1

Field selection

!!

Customizing: Product Types / Details (2)

© SAP AG AC816 4-21

SAP AG 1999

CS DGr1

Status name Int. level

Company codeProduct type

0001 33B

37 33760 335

Contract waivedContract

FI CG AFSX

X4 X

Company Code-Dependent Settings for Product Type - Status per Product Type

DGr

Customizing: Status Definitions

Field selection

© SAP AG AC816 4-22

SAP AG 1999

Basic data classification bas....Basic data posting rules basis...Conditions basic data

ChooseChoose

Basic data classification bas....

Loan type

Loan class

Primary collateral

Company Code-Dependent Settings for Product Type -> Define Status perProduct Type -> Field Selection

Suppress Req. entry Opt. entry Display

Customizing: Status Definitions - Field Selection

Select group

You can optimize your entry screens by customizing the values for the individual field status groups.

© SAP AG AC816 4-23

SAP AG 1999

PrevStat. Status name0

Prev.status Status name New status


0001 30B

0Contract

6060

Contract60

Company Code-Dependent Settings for Product Type -> Define Status Transfers per Product Type

Transfer matrix for external statuses

Contract

Status name

Customizing: Status Transfers

Copy stat. trans. Position...

For each company code, you define the permitted status transfers for each product type. This controls the processing steps permitted / required in loan processing. Example: Previous status "0" to New status "60" means that you can create a contract manually. You can map business processes used in your company by selecting the relevant status transfers. Status transfers that are not defined here are not permitted in the application.

To allow changes for a permitted status in the application, you have to create an entry where the previous status is the same as the new status. Example: If you want to allow changes to be made in contract status, you make the following entry: Previous status 60 - New status 60

© SAP AG AC816 4-24

SAP AG 1999

Exercise: Configuring Statuses

© SAP AG AC816 4-25

SAP AG 1999

You need to make the following Customizing settingsfor business partners used in the loans area:

1. Treasury Management -> Basic Functions -> Business Partners Examples: Number ranges, role category field modifications, views,

groupings, central data, general data, company code-dependent data

2. Treasury Management -> Loans -> Basic Settings ->Business Partner Settings

Examples: Assign role category to application, default values per producttype, company code-dependent settings for creating FI customersautomatically

Customizing: Business Partners

In addition to the settings for business partners in the Treasury/Basic Functions section of the IMG, you also need to make specific business partner settings in the Loans section.

© SAP AG AC816 4-26

SAP AG 1999

Central data General data

Company codedata

Businesspartner

NameAddress overview

Bank detailsPersonal data

Employment dataLegal data

Fiscal yearsRelationships

Role overviewRole data

Credit standingTax data

Reg. reporting dataControls

Bank

Account informationAccount interest

Autom. pmnt transact.Payment dataDunning data

Reg. reporting dataControls

Relationships

Business Partner Data: Overview

The data you can maintain for business partners is divided into three areas:

Central data This data is available for every business partner, regardless of the partner role.

General data General data is held centrally for all roles. Access to this data can vary according to the role category, depending on the settings in Customizing (role-view-assignment).

Company code-dependent data Data which only applies for a particular role category in a certain company code.

Each of these areas is divided into different views: Example: The "central data" area contains various views: - Name - Address overview - Bank details - ...

The business partner data also includes the Standing Instructions.

© SAP AG AC816 4-27

SAP AG 1999

Name RoleC

Business Partners

Control Data

Define Role-ViewAssignment

_

_

_

Roles

General

_

_Role ViewName of role Name

Acct mgmt0100

0100

Main partn.

Main partn.

0010

Pmnt data0040_

_

+

Define Role Types

RType Name RType RoleCA100 Main borr. 0100 Main partn.A102 Main lender 0100 Main partn.

Basic Functions: Customizing Settings forBusiness Partners (1)

In Customizing you can define which data views can be accessed for each role category. Example: If you do not assign the "Dunning data" view to the role category "Issuer", the user cannot call up dunning data for a partner in the role of issuer in the application. You can use role-view assignment to assign views from the general data and company code data areas to roles. Central data can be called up for all role categories.

Business partner roles (role categories) define the functions of the business partner in the transaction. You can refine the role categories predefined in the system by defining role types in Customizing.

© SAP AG AC816 4-28

SAP AG 1999

CreateCreatebusinessbusinesspartnerpartner

FI

CreateCreatecustomercustomer

Customizing:

Grp. NR Acct group Descr.of group.

TR01 01 DEBI TR partner (int)TR02 02 DEBI TR partner (ext)

No. From no. To no. Curr.no. Ext.

01 000000 000099 502 AAAAAA ZZZZZZ X

BP grouping

Number ranges

createdautomatically

Basic Functions: Customizing Settings forBusiness Partners (2)

TR

You define the number range for the business partner via the business partner grouping. This number range controls whether the business partner key is assigned internally by the system, or externally by the user. It also determines whether the key must be numeric or alphanumeric.

In addition, you use the business partner grouping to create the link to Financial Accounting by assigning a corresponding customer account group. If you create a partner and call up views that are relevant for processing on the basis of customer accounts, the system automatically creates an FI customer. Customer-based views: Bank details; tax data; control data; account information; account interest; automatic payment transactions; payment data; dunning data.

If an FI customer account is generated when a business partner is created, this does not necessarily mean that the customer account will actually be used later on. For example, if you create a business partner as the lender for a loan you have received and call up a customer view, the system still generates a customer account, even though this account is not used for processing loans taken.

© SAP AG AC816 4-29

SAP AG 1999

Create / change / displayCreate / change / display

Create / change / display in roleCreate / change / display in role in conjunction with loan

Loans Management

Basic Functions TR-TM

PartnerPartner

Business Partners

In business partner management, you can create, change and display general business partner data.

You can enter a loan partner in the system in three ways:

1. Create the business partner by choosing Basic Functions ->Business Partner in the application menu: In this case, you create the partner using a grouping, without assigning an application area. You can then assign loan-specific roles and data to the partner later on.

2. Within the Loans Management component - Business partner -> Create in Role: In this case, you first specify the application area (mortgage loan or general loan) and then enter the partner role (for example, "A102" Main lender) on the next screen. If role types have been defined for a role category, these are displayed; if not, the role category is displayed.

3. Within the Loans Management component - Create business partner in role when creating a loan: In this case, you select the partner role (role type or category) when you enter a loan. If an FI customer account is required for loans in that particular status (for example, "contract"), the system creates an FI customer automatically on the basis of the default values defined in Customizing. If no FI customer is required for this loan status, the system only creates an FI customer using the default values if you call up a customer view.

© SAP AG AC816 4-30

SAP AG 1999

Main loan partner

Guarantor

Loan clerk

Business partner

Role categories:

. . .

Business Partners: Roles

You can assign one or more business partners to a loan. A business partner may have one or several roles.

© SAP AG AC816 4-31

SAP AG 1999

Create Partner: Application AreaCreate Partner: Application Area

Application cat.

Role types / categoriesA100 Main borrowerA101 Other borrowerA102 Main lender...

Creating a Partner: Application Area

0010 Mortgage loan0011 Borrower's note loan0012 Policy loan0013 General loan0015 Interested party0016 Special arrangements

F4

Before you create the partner data, you choose the application area for which you want to use the partner. The application area determines the roles that can be chosen in the next screen.

Example: 0013 -> Mortgage loan

© SAP AG AC816 4-32

SAP AG 1999

RoleC Name of role category0100...

Main loan partner

Application - Mortgage loan

-

-

Loans

Basic Settings

- Business Partner Settings

Assign Role Category to Application

Grouping

"Double-click"

DAR1

Loans: Customizing Settings for Business Partners

In the Loans section you define which role categories (with their corresponding role types) are available for the various applications (mortgage loans, borrower's note loans, ...). This ensures that the choice of roles is relevant for the application in question. The role "Issuer", for example, is only relevant for borrower's note loans.

In the detail screen, you define which business partner grouping should apply for the role category. The grouping contains information relating to the number range and the FI account group. It creates the link to Financial Accounting.

© SAP AG AC816 4-33

SAP AG 1999

Loan 40000000

Select partner (or "double-click")

Treasury - Business partner management

PartnerClassification Appl. cat. General loan

Citi Organization

Loans: Business Partner Overview

Partner listName of role Name/address Address Citibank, Hamburg Default

PartnerCiti

Role0100Main loan partner

You can either create a business partner in advance (in general business partner management for Treasury or in the Loans menu) or define the business partner directly when you create a loan.

Within an application, offer, or contract you can call up all the data for the borrower by choosing Partner overview.

From the partner overview, you can also branch directly to the general Treasury business partner management functions and display or change partner data in the various screens.

© SAP AG AC816 4-34

SAP AG 1999

Basic dataBasic data ConditionsConditions CollateralCollateral ObjectsObjects Correspon-dence

Correspon-dence

..... various fields for information purposes / reporting / automaticdetermination of account assignment referenceContract currencyDiscount accrual/deferralFinance projectIPD control (only for loans given managed using customeraccounts)Planned/actual principleClerk assignmentCapital amountsAdditional fieldsUser fields

Creating a Contract - Basic Data

The system proposes the contract currency defined in the company code-dependent settings for the product type in Customizing. If no default currency has been maintained, the system proposes the currency of the company code.

You can define the additional fields yourself and use them for drilldown reports.

The other references and user fields are displayed for information purposes. You set up the user fields in Customizing.

© SAP AG AC816 4-35

SAP AG 1999

Loan type

Loan purpose

Maturity

Loan category

F4

Customizing Loans Master Data

Customizing: Basic Data (1)

The screens for entering an application, contract offer, or contract are identical. You can use field selection to define for each status which fields are displayed or hidden and which entries are required or optional.

For many of the fields in the basic data screens, you can call up possible entries using the F4 key. Most of these proposals reflect settings you can make yourself in the Implementation Guide (IMG), such as the loan type or the purpose of the loan.

In the IMG, you define the default values in the Loans -> Master Data section.

© SAP AG AC816 4-36

SAP AG 1999

Loans

+

+_

Basic Settings

Transaction Management

Master Data

Basic Settings

__

Indicators

_

_

_

Balance sheet indicators

:

Loan type / loan class

Purpose of loan

Maturity

Customizing: Basic Data (2)

You make the settings for the application, offer and contract basic data screens using the IMG activities in the Master Data section.

© SAP AG AC816 4-37

SAP AG 1999

Interest calculation capital

TimeRepayment:

debit positionRepayment:

Incomingpayment

Key:

Planned principle Actual principle

Basic Data: Planned/Actual Principle

! For loans taken, only the planned principle is permitted !

Indicator: Planned principle / actual principle: This indicator controls which repayment flows in the cash flow reduce the interest calculation capital.

Planned principle: The reduction in the interest calculation capital is calculated on the basis of the posted and planned debit positions as at the repayment settlement date.

Actual principle: The reduction in the interest calculation capital is calculated on the basis of the posted repayments in conjunction with the planned repayment debit positions as at the repayment settlement date.

© SAP AG AC816 4-38

SAP AG 1999

Customizing:

Activity type Role category Clerk as business partner2.

1. Field selection control for clerk fields in the basic data

Application: Loan contract no. 10000007

Activity type

P...

Loan clerk

P

Basic Data: Clerks

For information purposes, you can enter the name of the responsible loan clerk or team in the loan.

The rollover function is a special case. You have to create your rollover clerks as business partners with the role category "0991 Loan rollover clerk". There is a fixed link in the system between this role and the activity type "P - Rollover".

© SAP AG AC816 4-39

SAP AG 1999

Contract capital

Reduction

Current contract capital

Nominal capital

Commitment capital

Value-dated capital

Effective capital

Disbursement commitment

Remaining capital debit

position

Nominal remaining capital

Contract capital originally agreed

Total partial waivers

Contract capital ./. reduction

Total posted disbursements

Capital of current fixed period (see condition

header)

Total disbursements with capital transfers

Value-dated capital ./. repayments

Current contract capital ./. value-dated capital

Value-dated capital ./. (all) repayments

Debit position for the remaining capital without

price gains and discount (relevant for borrower's

note loans with net posting)

Basic Data: Capital Amounts

The capital amounts in the basic data are always based on posted and protected flows.

You can select the flows to be included in the calculations for the capital amounts by choosing the Cap. amnts button. In the dialog box, select the relevant flow and choose Calculation parameters. All flows takes all the records: planned records, actual records, protected records, simulated records and records still to be released

© SAP AG AC816 4-40

SAP AG 1999

Loan basic dataLoan basic data

Condition header

Cash flowCash flow

Condition items

Planned records

------------------------------------------------------

Condition Structure

The condition structure in the loans area is based on the central condition concept.

© SAP AG AC816 4-41

SAP AG 1999

Loan contractLoan contractLoan contract

Annuity repmntfrom 05/01/YY4.0%

Condition items

Condition header

Interestfrom 05/01/YY6.0%

Interestfrom 05/01/YY+35.5%

Fixed periodfrom 05/01/YY

04/30/YY+3

Fixed periodfrom 05/01/YY+3

04/30/YY+6

Chargesfrom 05/01/YY USD 100

Condition Header / Condition Items

The combination of condition header and condition items offers a high degree of flexibility when you set up the loan conditions.

The condition header contains date details (such as Fixed until) as well as information relevant for all items (such as Disbursement rate, Effective interest rate or Effective interest method).

Each condition item contains information relevant to that particular condition type (for example, nominal interest). You assign an effective period to each individual condition. This allows you to represent a condition structure in which the conditions change within the fixed period (example: an interest rate that changes annually for a fixed period lasting several years).

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SAP AG 1999


Correspon-dence

Condition header:

- Commitment capital- Disbursement rate- Repayment type (instalments, annuity, full repayment upon maturity)- Start of term / end of term- Fixed from / fixed to- Effective interest method (PAngV, Braess, ...)- Interest calculation method- Calculation buttons (end of term, instalment, interest, capital, effective interest, ...)

Contract - Condition Header

The condition header contains the basic condition data for the loan, including:

Term start / Term end: Term of the loan

Disbursement rate: Consideration of a premium or discount

Repayment type: The following repayment types are supported: Full repayment upon maturity, annuity repayment (fixed payment instalment); instalment repayment (falling repayment instalment); imputed annuity (partial disbursements and unscheduled repayments are not considered for the annuity calculation).

Fixed from / Fixed until: The period for which the first set of conditions applies ("fixed period" for the condition). The fixed from / fixed until period can be the same as or shorter than the loan term.

Effective interest method: Select the appropriate method from the possible entries.

Interest calculation method: Select the appropriate method from the possible entries. The method in the condition header applies for all the condition items that have no specific calculation method entry (see F1 Help with examples).

If you have made all the required entries except for one, you can let the system calculate the last value. For example, if you have already entered the term, interest rate and repayment parameters, the system will work out the repayment instalment.

You can calculate up to three effective interest values: Effective interest rate, internal effective interest rate and an alternative effective interest rate for comparison. For each individual effective rate you can specify a different yield method and define in Customizing which flow types are relevant for the calculation.

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Time periodsTime periodsTime periods

Condition item

Nominal interest rate5%

Eff. from MM/DD/YY

% or amount% or amount% or amount

Example: Nominal interest

Example: Effective from

MM/DD/YYYY

Example: 5%

Condition typeCondition typeCondition type

Contract: Conditions

Usually, a condition comprises of an amount or percentage rate in conjunction with a date.

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SAP AG 1999


Correspon-dence

Condition items:

For each condition type (fixed nominal interest / instalmentrepayment / charge, ...):

- Effective from- Percentage rate or amount- Calculation date- Due date- Exact payment form- ...

Contract - Condition Items

You enter the individual conditions as condition items.

The calculation date relates to the calculations in financial mathematics. In the case of an interest condition, for instance, this would be the last interest date for the corresponding interest period.

The due date is the date on which payment is due.

The exact payment form (PE) is the combination of the payment form (at the start of the period, mid-period, at the end of the period) and the frequency in months (monthly, quarterly, half-yearly ...). It therefore tells you exactly up to when the amounts have been calculated and when they are due.

You can enter all the data for the condition items manually, or enter certain "initial values" and let the system fill in the remaining fields. To use the latter option, you must specify the commitment capital, the effective period for the condition, the percentage rate or amount, and the exact payment form (or payment form and frequency).

The effect of a condition item depends on the Effective from date in conjunction with the calculation category defined (via the flow type) in Customizing. Nominal interest, for example, is not due until the first value date. You can also make the condition calculations dependent on certain events. Example: Charging a processing fee for each partial disbursement (see the documentation for the exact procedure).

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SAP AG 1999

Condition Items - Fields

Condition itemsCond.type text

Nom. interest

Ann. repmnt

Eff. from Percent Amnt Curr. Lvl IS PF PE Frq Due on ED Calc. date MC CR

05/01/YY 6.0000 UNI 3 VN 3 06/30/YY 06/30/YY

305/01/YY 4.0000 UNI VN 3 06/30/YY 06/30/YY

... ... ... ... ... ... ...... ... ... ...

Explanation of field names:

Lvl: Level number of condition items for recurring condition types

IS: Immediate settlement

PF: Payment form (at start of period, mid-period, at end of period)

Frq: Number of months in period

PE: Payment form - exact day (with adjustment days)

ED: End-of-month indicator for due date

MC: End-of-month indicator for calculation date

CR: Calendar rule. You can use the calendar rule to shift a public holiday, Saturday or Sunday to a working day. This is not usually applied to the calculation date (the interest calculation does not depend on whether the day is a working day), but is relevant for the due date (payments can only be made on a working day).

Example: Due date 01/01/YY (relevant for calculating the capital amounts) is shifted using the calendar rule to the next working day 01/03/YY, and referred to as the payment date (relevant for processing in accounting).

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Condition type 1

PF PE Frq Due on Calc. date Eff. from Percent

04/01/YY 5 05/15/YY 06/30/YY

One-time payment: Interest 04/01/YY - 06/30/YY, due on 05/15/YY

Condition type 2 04/01/YY 5 3 05/15/YY 06/30/YY

Regular payment: Interest calculated quarterly to the end of thequarter, payable at the middle of each quarter:04/01/YY - 06/30/YY, due on 05/15/YY07/01/YY - 09/30/YY, due on 08/15/YY10/01/YY - 12/31/YY, due on 11/15/YY......

or

Condition Structure: Frequency (1)

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Time(month)

01 02 03 04 05 06 07 08 09 ...

Example: Eff. from: 03/15/YY Frequency: 03Calculation date: 05/10/YY

Due on: 06/30/YY

Cash flow: Interest 03/15/YY - 05/10/YY, due on 06/30/YYInterest 05/11/YY - 08/10/YY, due on 09/30/YYInterest 09/11/YY - 11/10/YY, due on 12/31/YYInterest 11/11/YY - 02/10/YY+1, due on 03/31/YY+1....

Condition Structure: Frequency (2)

Calculations for financial mathematics (FiMa) start on the Effective from date. The last date up to which FiMa calculations for the (first) period are made is referred to as the calculation date.

The recurring periods for the FiMa calculations are determined by the calculation date in conjunction with the frequency. The calculation starts on the Effective from date of the first period.

The due date tells you when the amounts calculated are due, and reflects the accounting viewpoint. It is used in conjunction with the frequency to calculate the recurring due dates.

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Condition type 1

Condition type 1

Condition type 1

Condition type 2

Condition type 3

Eff. from Percent

04/01/YY 5

04/01/YY+1 6

10/01/YY+3 7

04/01/YY ...

04/01/YY ...

Interest:04/01/YY - 03/30/YY+1: 5% p.a.

04/01/YY+1 - 09/30/YY+3: 6% p.a.

10/01/YY+3 - "Fixed until": 7% p.a.

Condition Structure: Condition Types

You can enter the same condition type for different effective periods. Each condition entry applies from the Effective from date up to the next Effective from date of the same condition type, or the end of the fixed period.

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Int. rateadjustment

Int. rateadjustment

Repayment settlement

Repayment settlement

ChargesCharges

Variableinterest

RepaymentRepayment

Fixedinterest

Condition Types

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Condition items Condition form

1.1.2.2.3.3.

Zero conditionZero conditionFixed conditionFixed conditionStatistical conditionStatistical condition

Condition Form

You can use the Condition form (CF) field in the condition item to control the effect of a condition. If you choose the entry "Zero condition", the system only allows you to enter an amount or percentage rate of zero for that condition type. This is relevant when you have arranged to suspend repayments (repayment amount = 0), for example. "Fixed condition" means that the condition item is not recalculated for an alternative effective interest rate or term end. If a condition item is fixed, its values are not changed for the FiMa calculations.

A statistical condition is an inactive condition item that does not generate any flow records. This condition form is only used for information purposes.

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Condition OverviewCondition Overview

Detail screenDetail screen

Condition Items - Detail Screen

Items

Nominal interest

"Double-click"on relevant item

Here, you can enter additional data or edit existing entries.

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CoCdLoanCond. type 501

General loan taken Contract000140000000 L_Nominal int.

33B

Ref. int. rate

Eff. from 05/01/YY

Percent. calc.

FormulaInt. calc. method

Calculation dateDue datePayment date

No shiftIncl.

Calendar 01Calculation date Regular 3 Months 1st date

Data for percentage calculation

Regular 3 Months 1st date Incl.

No shift

Amounts

Dates

Condition Items - Detail Screen

Posting control 1 Automatic debit position Posting data / Other

Due date

If the loan has a variable interest rate or formula-based interest rate, you enter the reference interest rate or formula in the detail screen. You can also map "composite" interest rates, such as "EURIBOR + 5%" or "EURIBOR - 0.5%.

Field Posting control: For each condition item, you can define whether the planned records for the conditions can only be posted automatically (Post Planned Records) or only manually (Post Individual Records).

In the detail screen, you also enter the calendar to be checked by the calendar rule.

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Exercise: Conditions

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InterestRepayment

05/01/YY05/01/YY

6%4%

33

Cash flow - Planned records

. . . . . . . . .

Calculate yield

Interest /repayment schedule

FlowsFlows

Planned Records

On the basis of the conditions, the system generates flows. Initially, these flows are created in the form of planned records.

The system then uses the planned records to generate the cash flow, which is in turn required to determine the effective rate. The main component of the loan cash flow is the interest/repayment schedule.

The cash flow, the interest scale for the effective interest calculation, and the interest and repayment schedule are calculated on the basis of the fixed period for the conditions. If no Fixed until date has been entered for the conditions, the system generates the cash flow up to the specified Term end (but only for a maximum of 20 years).

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Correspon-dence

Due on Settlement amnt Curr.Name PFType

Loans - Cash Flow

L_Loan disbursem.L_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payable

100,000.001,166.671,333.331,726.672,000.001,691.672,000.001,656.672,000.001,621.672,000.001,551.672,000.001,516.672,000.001,481.672,000.00

UNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNI


SPPPPPPPPPPPPPPPP

10011110112011101120111011201110112011101120111011201110112011101120

On the basis of the conditions belonging to a financial transaction and the specified calculation period, the function modules for financial mathematics for the relevant application (such as stock purchase, swap, loan contract) calculate a series of payment flows for the transaction. This series of flows is referred to as the cash flow.

The cash flow for financial transactions is used as the basis for all trading, transaction management and position management processes, as well as for the evaluation activities within Treasury. Activities based on the cash flow include:

Effective interest calculation

Posting

Accrual and deferral of expenses and revenues


Flow types describe the different changes to the cash flows. Together, all the flows for a transaction form the basis for generating the cash flow, and for further processing, such as posting. The cash flow contains all the flow records in chronological order and is used as a basis for updating the transaction data in Financial Accounting, Cash Management, and Market Risk Management. Typical flow types are fixed or floating interest, increases in nominal amounts or commission.

© SAP AG AC816 4-56

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IDES AG

AIBD/ISMA Braeß Moosm. PAngV

Scaling period 05/01/YY to 04/30/YY+5Contract no. : 10000000

Effective rate: 7.79600

Page 1

% PANGV

Value date

05/01/YY06/30/YY06/30/YY09/30/YY09/30/YY12/31/YY12/31/YY03/31/YY+103/31/YY+105/01/YY+106/30/YY+106/30/YY+1

Activity

L_DisbursementL_Instalm. repmntL_Interest payableL_Instalm. repmntL_Interest payableL_Instalm. repmntL_Interest payableL_Instalm.rep.L_Interest payableInterest capitalizat.L_Instalm. repmntL_Interest payable

Amount

100,000.001,333.33-

1,166.67-2,000.00-1,726.67-2,000.00-1,691.67-2,000.00-1,656.67-6,777.93-2,000.00-1,621.67-

Balance

100,000.0098,666.6797,500.0095,500.0093,773.3391,773.3390,081.6688,081.6686,424.9993,202.9291,202.9289,581.25

Days

59

90

91

90

3059

90

Interest

1,179.34

1,754.03

1,705.73

1,620.57

518.261,099.18

1,611.57

Effective Interest Calculation

The system draws on both the planned and actual records in order to determine the effective interest rate. The key flow information is derived from the condition items. A special feature in Loans Management is that the effective rate is calculated on the basis of the cash flow. This avoids the disadvantages of a conventional solution with mathematical formulas. It also allows you to include any of the various price components or flows (for example, insurance premiums) in the effective rate calculation. You can then switch between methods and compare the different results.

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PAYMENT SCHEDULE Loan no. 10000000 05/01/YY

Mortgage loanUNI 150,000.00Universal currency

Loan type:Commitment cap.:Display currency:

Conditions

L_Nom. int.

L_Instalm. rep.

Payment date

05/01/YY06/30/YY09/30/YY12/31/YY03/31/YY+1

Eff. from

05/01/YY

05/01/YY

Payment

2,500.003,726.673,691.673,656.67

Percent

7.00000 %

Interest

1,166.671,726.671,691.671,656.67

Amount

2,000.00

Frequency

Quarterly

Quarterly

Repayment

1,333.332,000.002,000.002,000.00

Calculation from:Calculation to:Start of term:End of term:End of fixed period:

05/01/YY04/30/YY+505/01/YY04/30/YY+1004/30/YY+5

First pmnt

06/30/YY

06/30/YY

Other

Int. calc. meth.

360/360

360/360 imm. settlem.

100,000.00 98,666.68 96,666.6794,666.6792,666.67

Rem. bal.

Payment Schedule

The system generates the payment schedule on the basis of the planned records in the cash flow. The payment schedule contains both general data relating to the loan and the condition items. It lists all the payments for the fixed period, split into interest payments and repayments, with the corresponding outstanding balance.

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SAP AG 1999

APPLICATION LEVEL

Product cat.Product cat. Flow categoryFlow category Calculation cat.Calculation cat.


SYSTEM LEVEL




Flow typeFlow type


Flow types describe the different changes to the cash flows. Together, all the flows for a transaction form the basis for generating the cash flow, and for further processing, such as posting. The cash flow contains all the flow records in chronological order and is used as a basis for updating the transaction data in Financial Accounting, Cash Management, and Market Risk Management. Typical flow types are fixed or floating interest, increases in nominal amounts or commission.

Flows are generated on the basis of conditions (such as interest flows), manual entries (such as charges), accrual/deferral runs (such as interest deferrals), or valuation runs (such as write-downs).

© SAP AG AC816 4-59

SAP AG 1999

Controls accountingprocessing

Controls processing in financial mathematics

Example:Flow type

Flow category

Inflow

Calculation category

Inflow

A AA

Loan disbursement1001

Customizing: Define Flow Types (1)

The payment flows for the cash flow and those for posting are controlled by two indicators that must be assigned to each flow type. The calculation category controls how the flow is processed by the financial mathematics modules that generate the cash flow. The flow category controls how the flow is posted.

Each flow type is assigned to exactly one flow category. However, several flow types can be assigned to the same flow category. For example, the flow types for fixed interest and floating interest are assigned to the flow category "interest".

Examples of flow categories include accounting flows, such as inflows (such as loan disbursements), outflows (such as repayments), expenses or revenues. Flows relevant for generating the cash flow include loan disbursements, interest payments, repayments, or charges.

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SAP AG 1999

Flow type

Flow categoryCalculat. cat.

InflowInflow

Assets/Liab. Loans taken

Posting controlIncoming pmnt

Relev. to CM

L_Loan disbursement rec.

AAA

1

Payment requestIndividual pmnt

Payment details

Direction +

Grouping

Posting

!

!

Customizing: Define Flow Types (2)

1001

A flow type can either be used for loan assets (loans given) or loan liabilities (loans taken).

If you want to transfer the amounts for a flow type to Cash Management, set the indicator Relevant to CM.

You can only use the payment details for loans that are not posted to customer accounts. If you want payment details to apply for a flow, specify the direction in the flow type. If a direction exists, the information that belongs to this direction is taken into account:

Payment request indicator: Set = PR permitted, not set = PR not permitted.

Individual payment: If the Payment request indicator is set to active, and you activate the Individual payment indicator, the system does not allow payment netting.

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SAP AG 1999

Exercise: Defining Flow Types

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CGr

504

Flow category

Disc. / prem.

FTyp1

1165FTyp2

1170

Payment date

05/01/YY

05/01/YY

. . .

Settlem. amnt Name

Loan disbursement

Discount pay.

P FTyp

P 1001

P 1165

Cash flow

FCat

TA

Name

Discount pay.

3,000.00

150,000.00

Name

Premium rec.

CustomizingCustomizing

Cash flowCash flow

Assign Flow Types to Flow Category

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SAP AG 1999

APPLICATION LEVEL

ProductProductcat.cat.

Flow categoryFlow category Calculation cat.Calculation cat.


SYSTEM LEVEL




Flow typeFlow type


In the SAP Treasury system, financial transactions are mapped using conditions and flows. Conditions are components of the transaction contract. You can define your own condition types, for example different forms of interest and repayment. You assign each condition type to a product type (via the condition group). This ensures that every product type has the appropriate structure characteristics. Condition types therefore control which structure characteristics are displayed when you create transactions for a specific product type.

To simplify the procedure, related condition types are grouped in condition groups, and the condition groups are assigned to the product types.

On the basis of the conditions, the system automatically generates flows that appear in the cash flow. You therefore need to assign flow types for generating the cash flow to the condition types. Example: In the case of the product type "30B Mortgage loan", the system generates the interest amount as at the interest due date on the basis of condition "501 Fixed nominal interest". The flow type "1110 Nominal interest" is assigned to the condition "501 Interest".

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Define condition types

Define condition groups

Assign condition types to condition groups

Assign flow type to condition group perapplication function

1.1.

2.2.

3.3.

4.4.

Customizing: Conditions

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SAP AG 1999

CTyp Condition type text RefC FTyp1 FTyp2 FCat FiMa Payt500 L_Nom. interest var.501 L_Nom. Interest fixed509 L_Int. rate adjustm.512 L_Processing fee561 L_Annuity repayment562 L_Instalm. repayment

...

11101110

500614511251120

TZ TZTZZFTB TB

TTANTTRA

TZZA

TTANTTRA

Customizing: Condition Types

Field selection

The main task of conditions is to generate flows automatically. You therefore need to assign flow types for generating the cash flow to the condition types. Note that some condition types do not generate flows (for example, interest rate adjustment or repayment settlement).

For some condition types, you have to specify a reference condition type for processing in the cash flow. When you define these condition types, you must enter the corresponding reference condition type in the RefC field (for example, interest rate adjustment).

If the Payment activity (Payt) indicator is set to active, flows for this condition can be posted to a customer account or to a G/L account. In this case, the setting for the product type (FI posting 3 or 4) is decisive. If the Payment activity indicator is not set, flows for this condition are never posted to a customer account.

You can influence what appears on the entry screen for the various condition types by using field selection control (fields: suppress, required, optional, display).

© SAP AG AC816 4-66

SAP AG 1999

CGr Name Ass/Lia

1 Mortgage loan given

2 Borrower's note loan

3 Policy loan given

4 General loan given

504 Loan taken...

0

0

0

0

1

Customizing: Condition Groups

In this step, you define the condition groups you require. You assign the appropriate condition types to these condition groups, and then assign the condition groups to your product types. As a check, the condition groups for loans given / loans taken (assets/liabilities) are named accordingly.

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500 L_Nominal interest var.501 L_Nominal interest fixed509 L_ Int. rate adjustment512 L_ Processing fee 561 L_ Annuity repayment562 L_Instalment repayment571 L_Annuity rep. settlement572 L_Inst. rep. settlement..

.. .

.

Double-clickDouble-click DetailsDetails

CTyp Condition type text

Condition group 504

Assign condition types to condition groups

Customizing: Condition Assignment

You assign appropriate condition types to each condition group.

You can make detail settings for each condition type in relation to a particular condition group.

© SAP AG AC816 4-68

SAP AG 1999

Sequence no. 1Hierarchy Hide

Int. calc. methodPmnt methodIncoming pmntPosting control

Calendar rule

Inclusive ID

Calendar rule

Due date meth.

Condition form

Month-end Month-end calc.1

1

No shift No shift

Regularly with fixed dates

Field control

Default valuesBasic data Payment data / Posting

Calculation date Due date

Other data

501 L_Nominal interest var.1Condition group

Condition type

Customizing: Condition Assignment -> Details

Pmnt formCalendar 01

In the detail screen you define the sequence of the condition types within a group.

If you set the Hide indicator, this condition type does not appear on the screen automatically when a loan is entered. If necessary, however, the user can add this condition to the list of condition items manually. Example: You usually need to enter an interest rate condition for a loan. By contrast, a processing charge is optional. This condition type should only be included if you intend to charge processing fees (suppress condition type "processing charge").

You can define default values for each condition type (per condition group). These default values appear as proposals when you enter the conditions in the contract. Example: You want to shift dates to working days. You can make the relevant entries in the application by entering the calendar rule in the condition overview and the corresponding calendar in the condition detail screen. To simplify data entry, you can define default values for the calendar rule and calendar in Customizing.

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Application:

- Company code- Product type

Product category Condition group

Condition types

Flow types

Flow category Calculation category

Create loan (Application, offer, contract)

Customizing:

Application: Cash flow

Other flow types

Conditions: Summary

When you create a loan, you must specify the company code, product type, business partner, and (if you have opted for external number assignment) the loan number.

The system applies the Customizing settings for the product type chosen by the user.

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Exact payment form

PE

JMJNJVMM:

Name

Mid-yearYearly at end of periodYearly at start of periodMiddle of the month - 1 day:

via F4

Company code-dependent settings for product type - detail screen

Pmt form start

Pmt form start

Condition items

Cond. type text Eff. from Percent Amnt Curr.Lvl IS PF PE Frq Due on ED Calc. date UB CR

05/10/YY 10.0000 UNI 3 MN 12 06/09/YY 06/09/YYNominal int.

Customizing: Payment Form

The Exact payment form (PE) with correction days is a combination of the payment form (at start of period, mid-period, at end of period) and the frequency. To speed up data entry, you can define meaningful keys for these options in Customizing (for example, J - yearly; combined with V - at start of period, M - mid-period, N- at end of period).

You define the basis for the frequency (calendar units or Effective from date) in the company code-dependent settings for the product type. Example: Nominal interest, effective from 05/10/YY, PE: MN - Calculation date/due date on basis of calendar: 05/31/YY - Calculation date/due date on basis of condition date: 06/09/YY

© SAP AG AC816 4-71

SAP AG 1999


Creating a Loan: Initial Screen

Reference data

Sample loan no.Partner

Sample loan

0001/internal/33B

There are three alternative ways of creating a loan (application, offer, contract):

1. Fill all the master data fields manually.

2. Transfer the data from a sample loan. You create a sample loan using the Sample loan function. The data is entered in the same way as for a "standard" loan, but without a business partner. If you want to use a sample loan to create a new loan, you enter the corresponding data in the Reference data section.

3. Copy the data from a "standard" contract created previously. Choose Copy from... . A dialog box appears prompting you to specify the contract from which you want to copy the data.

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Correspon-dence

Contract - Correspondence

...External account statement

...Interest certificate

....Dunning

The Correspondence tab is only relevant for loans given. The Dunning section on this tab only applies for loans given managed on the basis of customer accounts.

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SAP AG 1999

Enter loans taken with different condition structurevariants (such as fixed interest, variable interest, orsuspended repayment)

Make the system settings for the product types yourequire and the corresponding conditions


Loan Contract: Unit Summary

© SAP AG AC816 4-74

Loan Contract Exercises

Unit: Loan Contract


• Set up product types for specific types of loan

• Set up the process for entering loans in the system

• Set up the entry screens

You intend to take out another loan. For this loan, you want to define a new product type (for example, for reporting purposes).

1 You have been granted a new general loan, and want to define a new product type for entering this loan in the system. Create the product type DXX for your group (XX = your group number). Make the following assignments:

• Product category 330

• Loans taken

• Condition group 504

• Collateral active

2 You now need to make the necessary settings for your company code: Amongst other things, you want to be able to create a contract directly in the application.

2-1 In your company code, you want the loan number to be assigned internally (by the system). Use the number range "04".

• You want to use the functions for payment details.

• In your company, Cash Management is updated for a period of 5 years.

2-2 To simplify data entry, you only want specific fields to be available for input. Make corresponding field selection settings for the following areas:

• Basic data order/accept.basis:

- Approval date

- Currency

• Basic data inter.calcul. basis:

- Planned/actual principle

© SAP AG AC816 4-75

• Basic data evaluation inform.:

- Loan maturity

• Conditions basic data:

- End of term

- Commitment capital

- Start of fixed period

- Discount calculation method

- Effective interest method

- Repayment type

Interest calculation method

2-3 Create the status "60" (contract).

Enter the following criteria:

• Internal level 35

• Document group 3

• Generate cash flow in contract status (CG)

2-4 Set up the necessary status transfers. Also allow changes within a status.

3 Display the conditions for the contract you have already entered. Branch to the condition details.

4 You require an additional flow type for a special charge.

Define the flow type SXX (L_Special charge GRXX). To do this, copy the existing flow type 6145 (L_Processing charges Pay.).

© SAP AG AC816 4-76

Loan Contract Solutions

Unit: Loan Contract


• Set up product types for specific types of loan

• Set up the process for entering loans in the system

• Set up the entry screens

1 Defining a product type

→ Treasury → Treasury Management → Loans → Transaction Management → Product Types → Define Product Types

Make sure that you use the name specified in the exercise for your product type, since other Customizing settings depend on this name.

2-1 Company code-specific settings for product type

→ Treasury → Treasury Management → Loans → Transaction Management → Product Types → Company Code-Dependent Settings for Product Type

2-2 Defining field selection ...

→ Company Code-Dependent Settings for Product Type

Button: Field selection

Set up the fields as "Required" or "Optional". Set the field for the Planned/Actual principle to "Display".

© SAP AG AC816 4-77

2-3 Define Status per Product Type


In this screen: → Define Status per Product Type

For status 60 (contract), enter the reference to the internal level 35.

2-4 Setting up status transfers


In this screen:

→ Define status transfers per product type

© SAP AG AC816 4-78

3 Displaying contract conditions → Accounting

→ Treasury → Loans → Transaction Management → General Loan → Contract

→ Display

To see the detail screen for a condition, double-click on the corresponding condition item.

4 Defining a flow type → Treasury

→ Treasury Management → Loans → Transaction Management → Flow types → Define Flow Types

First select flow type "6145", and then use the copy function.

© SAP AG AC816 5-1

SAP AG 1999

Processing disbursements received

Integration: Loans Management --> Financial Accounting

Integration: Loans Management --> Cash Management

Customizing:

- Accounting and product type / status / flow types /conditions

- Account assignment reference- Account determination- Integration with Cash Management

Contents:

Disbursement

© SAP AG AC816 5-2

SAP AG 1999

Process (post) the disbursement for a loan youhave entered

Configure the system in such a way that postingactivities can be carried out correctly


Disbursement: Unit Objectives

© SAP AG AC816 5-3

SAP AG 1999

Payments due

Closing operations

Condition changes




Course overview


Process flow forloans taken

Loan contract

Disbursement


© SAP AG AC816 5-4

SAP AG 1999

The loan has been disbursed to us.

Disbursement: Business Scenario

© SAP AG AC816 5-5

SAP AG 1999

- Create loan- Business partners- Conditions- Loan: Disbursement / posting- Integration with CM- Integration with FI

Appli- Offer ContractAppli- Offer Contract Disburse- Other data Other data RolloverRollover cation cation ment



© SAP AG AC816 5-6

SAP AG 1999

Disburse Contract: Basic DataDisburse Contract: Basic DataDisburse Contract: Basic Data

CoCdLoan

General loan takenCitibank Hamburg

000110000000

33B

Disburse Contract: Settlement

Disbursement basic dataFlow typeTextPayment dateIntValDateWithhold. up toPosting control


L_Loan disbursement Rec.1001

05/01/YY05/01/YY05/01/YYAutomatic debit position

Incl.

DBGIRUN

Capital dataCurr.cntrct cap.Nominal capitalDisbursement in %Gross pmnt amountNet pmnt amount

Disbursement rate 98.00000

146,500.00

150,000.00 UNI 0.00 100.0000 150,000.00 UNI

If you enter a date in the Withhold. up to field, the system selects all of the condition-based planned records for the contract that are due by this date and flagged for withholding, and withholds them from the disbursement amount. The selected records are listed on a second screen for incidental costs.

The following applies for each loan contract:

Only one disbursement can be entered for each payment date.

You cannot create a disbursement with a payment date earlier than the last existing disbursement.

If you have created several partial disbursements, you can only change the last disbursement entered.

You can create as many partial disbursements with "planned" status as you require.

You can only have one disbursement with the status "to be released"; additional disbursements can only be carried out once an existing disbursement has been released.

© SAP AG AC816 5-7

SAP AG 1999

Create Disbursement: Incidental CostsCreate Disbursement: Incidental CostsCreate Disbursement: Incidental Costs

Company codeLoan

General loan takenCitibank, Chicago

Disburse Contract: Incidental Costs / Withholdings

Capital amountsAvailable capital Value-dated capital150,000.00 150,000.00

Flows

Flow type Name Due on W/HSettlement

amountPmntmethod

Processing charges

Discount

......

6145 05/01/YY 500.00 X

1165 05/01/YY 3,000.00 X

0001 33B10000000

In Customizing, you can control which flow types can be processed for the disbursement.

The incidental costs you enter here can be withheld (deducted) from the disbursement amount (W/H flag set). Alternatively, you can post the incidental costs separately (W/H flag not set); if you want to trigger the payment yourself later on, you must enter a payment method for processing with the payment program.

Examples of incidental costs are: - Premiums/discounts - applied automatically by the system - Flows created explicitly here (for example, disbursement charges) - Condition-based planned records - selected via Withhold up to

If condition-based planned records are selected, these are only considered if the withholding indicator has been set. Other incidental costs entered in this screen are considered as either withheld or as a pure debit position posting (you can choose whether to specify a payment method). You can set the withholding indicator as a default in the company code-specific data for the product type.

© SAP AG AC816 5-8

SAP AG 1999

Disbursement

Save Post (manually)

P

Post manually Post automatically

"Automatic debit position”

or

"Manual debit position"

"Automatic debit position"

I I

I



Saving/Posting Disbursements

You can either post the disbursement immediately (I = actual record), or save it first (P = planned record) and post it later.

The planned record for a disbursement you have saved can be posted in two ways: By calling up the disbursement data for the loan, you can post the individual record manually. Alternatively, you can let the system post the flow automatically with the mass processing function Post Planned Records. The entry you make in the Posting control field for the disbursement determines the type of posting permitted - manual posting only, or both manual and automatic posting.

© SAP AG AC816 5-9

SAP AG 1999

Liquidity forecast / cash position

05/01/YY 146,500.00

L o a n d i s b u r s e m e n t

TR-CM interface FI interface

Disbursement postedDisbursement savedDisbursement posted



As soon as you save a disbursement, the system generates planned records and writes them to the database. These planned records form the basis for integration with TR Cash Management.

If you post the disbursement immediately, the records are also integrated with Financial Accounting. You can then display the corresponding FI document.

© SAP AG AC816 5-10

SAP AG 1999

TR - LO

Application, offer

Contract

Saved contract disbursement Not posted to customer (Planned record) accounts (without PR):

Banks: Level 1, Account113100

TR - CMTR - CM

Integration: Disbursement / Cash Management

Amounts from an application, offer, or contract are not transferred to Cash Management, since the cash outflow data has not yet been fixed (amount (full or partial disbursement), date).

Once you know the disbursement details, you enter them using the disbursement function. When you save the data, the cash flows are visible in CM.

PR - payment request

© SAP AG AC816 5-11

SAP AG 1999

Loans Management: Cash flowLoans Management: Cash flowLoans Management: Cash flow05/01/YY 150,000.00 Loan disbursement 0001 06/30/YY 1,720.83 Interest debit pos. 100106/30/YY 639.05 Annuity repayment 1103

Planned loan disbursement

Without customer accounts

TR-CM Cash position

Grouping: BanksGrouping: Banks Bank accounts 05/01/YY

DBGIRO 113100

Level 1* Loans 150,000.00

Integration with Treasury Cash Management

© SAP AG AC816 5-12

SAP AG 1999

Posting log FI document: 160000164805/01/YY

CoCdePK

0001

405040504050

4040405050

40504050

1131056212098000113105204000113105

113105113105194200113105113105

113105194200113105194200

Bank clearing accountLoans from financial institutionsDeferred expensesBank clearing accountOther expensesBank clearing account

Bank clearing accountBank clearing accountTechnical clearing accountBank clearing accountBank clearing account

Bank clearing accountTechnical clearing accountBank clearing accountTechnical clearing account

150,000.00 D150,000.00 C

3,000.00 D3,000.00 C

500.00 D500.00 C

149,500.00 D146,500.00 D

3,500.00 D150,000.00 C149,500.00 C

3,000.00 D3,000.00 C

500.00 D500.00 C

1001 L_Loan disbursement rec.

1165 L_Discount pay.

6145 L_Processing charges pay.

1001 L_Loan disbursement rec.1001 L_Loan disbursement rec.1001 L_Loan disbursement rec.6375 L_Reduct. loan pay-in amount6375 L_Reduct. loan pay-in amount

6365 L_Discount withheld

6345 L_Processing charges withheld

Disburse Contract: Posting Log

The above screen is an example of a posting log generated upon disbursement of a contract. In this case, the contract is not posted to a customer account, and does not generate a payment request.

© SAP AG AC816 5-13

SAP AG 1999

TR - LO

Application, offer

Contract

Disbursement saved Banks: Level 1*, bank account(planned record)

Disbursement posted Banks: Level 2*, bank clearing acct(actual record)

Planned records for interest/ Banks: Level 1*, bank accountrepayment

Bank statement Banks: Level 3*, bank account

Not posted to customer accounts (without PR) TR - CMTR - CM

Integration with Cash Management - Overview

PR - payment request

Above example: Posting not made to customer accounts

Level 1*: Taken from Customizing for loans; all the other levels come from the FI account master records.

© SAP AG AC816 5-14

SAP AG 1999

Exercise: Disbursing a Contract

© SAP AG AC816 5-15

SAP AG 1999

LoansLoanssubledgersubledger

FI generalFI generalledgerledger

G/L accounts Customer master data Screen control Document types Posting keys

Customizing: Integration with FI

To use the subledger accounting functions for loans, you have to make settings in R/3 Financial Accounting.

For example, you have to create loan-specific account groups and number ranges in the customer master data.

In addition, you have to set up loan-specific field status definitions for screen control.

© SAP AG AC816 5-16

SAP AG 1999

40

50

+



Line Item

Define Posting Keys

Financial Accounting Global Settings

Document

Controls

FI Posting Keys for Loans

To use the Loans component, you have to change the field status of some of the standard FI posting keys.

To do this, set the field status groups "Invoice reference" and "Financial assets management" to optional entry status. As a result, the additional fields Contract number, Contract type, and Flow type are displayed when you enter a document with the corresponding posting keys.

Loans taken: G/L account posting keys only (for example, 40 and 50)

In the above example we have assumed that the posting keys displayed are used for account determination in Loans Management.

© SAP AG AC816 5-17

SAP AG 1999

Financial AccountingG/L accounts

TR Loans(1) Product types

(2) Status definitions/transfers

(3) Flow types

(4) Conditions

(5) Account assignment reference / account determination

Accounting Customizing: Overview

All the postings from Loans Management are transferred to R/3 Financial Accounting. You must therefore set up the appropriate accounts in FI.

© SAP AG AC816 5-18

SAP AG 1999

Assets/Liab.

(1) FI posting (post with or without customer)4: Only post without customer

CM period (horizon for which planned records aresaved)

Function-specific settingsDefault setting for withholding indicator fordisbursement

....

Product type

Customizing: Product Types and Accounting

© SAP AG AC816 5-19

SAP AG 1999

(2) FI posting without customer (4)

You can make postings in the first status thatcontains an entry:FI posting = 4: Only postings without customeraccounts possible

Status

Customizing: Status and Accounting

The settings for the FI posting in the product type (1) must match the corresponding setting for the respective status (2).

If "4" is entered in the product type as well as in the status (without customer), no flows are posted to customer accounts, irrespective of the entries for the condition (4) or the flow type (3).

© SAP AG AC816 5-20

SAP AG 1999

Exercise: Posting Settings for a Specific ProductType

© SAP AG AC816 5-21

SAP AG 1999

Appl.func.

001

. . .

FType

1001

. . .

Name


. . .

Pmnt tr. ID

. . .

Flow type

Text

Payment date

Disburse Contract: Settlement

05/01/YY

0001

Flow types

(3)

Per condition group

001Disbursement:Settlement

002Disbursement:Incidentalcosts

100Individualplanned recordposting...

F4


ApplicationApplication

Assign Flow Types to Condition Groups for EachApplication

In Customizing, you define which flow types may be used for specific application functions. For example, there are two application functions for disbursement: 1) Settlement (initial screen), 2) Incidental costs. When you enter a disbursement, you can then choose from the flow types that you have assigned. Example: You are entering a partial disbursement, and want to clear the interest amounts due for the previous partial disbursement. If the flow type for interest has been assigned to the application function for this condition group (and is therefore permitted), you can select these records to withhold them from the partial disbursement you are currently processing (field: Withhold. up to).

The Payment transaction ID field controls the value of the payment transaction field for a flow type per application. Possible values: 0: Not posted to customer accounts 1: Only posted to customer accounts (loans given only) 2: Both possible (posted to customer accounts / not posted to customer accounts)

© SAP AG AC816 5-22

SAP AG 1999

FTyp

1110

1165

6145

1001

1001

Name

L_Interest pay.

L_Discount pay.

L_Processing charges pay.



RFlT

6310

6365

6345

6385

6375

Name

L_Interest withheld

L_Discount withheld

L_Processing charges withheld

L_Increase loan pay-in amount

L_Reduct. loan pay-in amount


Company code 0001

Relationship

009 Incoming payment fromwithholding on disbursement

011 Change in disbursementobligation resulting fromwithholding: debit position

042 Change in disbursementobligation resulting fromwithholding: credit position

F4

009

011

042

Flow types

Disbursement: Offsetting Flows

© SAP AG AC816 5-23

SAP AG 1999

Define Condition Types

CTyp Condition type text RefC FTyp1 FTyp2 FCat FiMa Payt200 A_Nominal int. var.201 A_Nominal int. fixed...500 L_Nominal interest var....

01100110

TZ TZTZ TZ

(4) Payment activity (= posted to a customer account?)

Flag = Yes = Posting possible with/without customer

No flag = No = Posting without customer

Conditions

1110 TZ TZ

Customizing: Conditions and Accounting

© SAP AG AC816 5-24

SAP AG 1999

Flow Types and Accounting

Flow types control the following:

The financial mathematical basis for calculating the cashflow (calculation category)The effective interest calculation

Integration with Treasury Cash Management

The posting record in the general ledger

(5) Account determination

© SAP AG AC816 5-25

SAP AG 1999

Example: Loan disbursement receivedPosting record (= "Posting specifications") :

From (40) Bank clearing account to (50) Balance sheet account ... UNI

to 62120 ... UNILoans fr. fin. institutions

from

Here: From Bank clearing account

Bank clearing account

- changeable -

Transaction (paymentdetails) or accountdetermination

Account determination

Balance sheet account

from

Transaction

Acct assignment reference

- fixed -

Posting Loans: Overview

To post disbursements: You define the balance sheet account in the account assignment reference. As well as the account number for the loan balance sheet account, the account assignment reference also contains additional information (for example, the business area). The account assignment reference itself is determined automatically by the system in accordance with the rules you have defined in Customizing. You cannot change the balance sheet account in the account determination settings for transaction postings.

The system takes the bank clearing account from the payment details in the loan (if used), or from the account determination settings. If you specify an account in the payment details for the loan, you can change it later as part of account determination for the posting.

© SAP AG AC816 5-26

SAP AG 1999

Posting Loans Given and Taken

Loans given

Posted to customeraccounts

- Yes- No payment details (PD)- Use of FI payment program

- Yes- PD can be used- Payment program for payment requests can be used

- No

- Yes- PD can be used- Payment program for payment requests can be used

Loans taken

Not posted to customeraccounts

If a product type is not managed on the basis of customer accounts, you can permit the user to enter payment details in the transaction by activating the corresponding indicator in the detail screen for the product type in Customizing. The following functions are then available:

Maintenance of payment details for the loan/borrower's note order; possible to let the system default to the data from the business partner standing instructions

Update in Cash Management using the house bank and house bank account specified in the payment details

Use of the replacement rule in account determination for the house bank account specified in the payment details

Generation of payment requests

Netting with other payments processed using payment requests

© SAP AG AC816 5-27

SAP AG 1999

Account assignment referenceDefine

Set up automatic determination

(5) Account determinationDefine

Customizing: Account Assignment Reference /Account Determination

© SAP AG AC816 5-28

SAP AG 1999

AcctAssRef Short text30A <1 Mortgage loan given (term less than 1 year)30A 1- 5... .

.

G/L account

.

.

62120

Company code TR00

Details

Mortgage loan given (term 1 to 5 years)

Account Assignment Reference

The account assignment reference determines the G/L account (balance sheet account) in FI to which the loan is posted. By using different account assignment references, you can achieve a differentiated position structure.

When you save a loan, the system determines the account assignment reference according to certain rules and inserts it in the transaction. If the system is unable to determine the account assignment reference, you can still save the loan. You cannot, however, create a disbursement, since you need to know the balance sheet account in order to be able to post a disbursement. You may have to enter additional loan data for determining the account assignment reference.

© SAP AG AC816 5-29

SAP AG 1999

Posting specificationsAccounts Symbols

Flow type 1001

Debit 40 3 Bank clearing Comp

Credit 50 1Document type SA Posting category

1001

Debit 40 3.1 Bank (replacement)Comp

Credit 50 1 Balance sheet acct

Flow type

Document type Posting category

1110

Debit 403.1

Interest paidComp

Credit 504.1.3

Bank (replacement)

Flow type

Document type Posting category

SA

SA

31

Payment transact. 2

31

Payment transact. 2

43

Payment transact. +

...

DebitComp

Credit

Flow type

Document type

Payment transact.

Balance sheet acct

Account Determination: Posting Specifications (1)

You specify the accounts to be used for the various posting transactions in account determination. The account determination settings contain the posting specifications, the account symbols used for the posting specifications, and the (G/L) accounts assigned to the symbols. The account determination settings depend on the flow type and the payment transaction.

Debit and credit postings are defined using the corresponding posting keys (40: G/L account debit posting, 50: G/L account credit posting, 14: Subledger account debit posting).

The document type controls posting in Financial Accounting (SA: G/L account document).

In order to carry out posting in Financial Accounting you need to fulfil the following prerequisites:

All the accounts you require have been created and set up correctly.

The document type table contains the document types and permits postings to the account types required.

The number range relating to the document type has an internal number assignment in Financial Accounting.

The posting period is open for posting.

© SAP AG AC816 5-30

SAP AG 1999

Payment transaction

Posting specifications

1110 L_Interest pay.

1001FTyp Name

L_Loan disbursement rec.::

::

2 Not posted to cust. accounts, house bank account defined

X Posted to customer accounts

Flow types • Posting category

Account Determination: Posting Specifications (2)

1 Not posted to cust. accounts, no house bank account defined

11 Balance sheet to balance sheet12 Balance sheet to subledger13 Balance sheet to bank14 Balance sheet to profit/loss15 Balance sheet to G/L account21 Subledger to balance sheet .31 Bank to balance sheet32 Bank to subledger33 Bank to bank34 Bank to profit/loss35 Bank to G/L account41 Profit/loss to balance sheet42 Profit/loss to subledger43 Profit/loss to bank44 Profit/loss to profit/loss45 Profit/loss to G/L account51 G/L account to balance sheet::

PT Name

You make the account determination settings in two steps:

1 You first define the posting specifications, which are based on the flow type and payment activity. The posting specifications describe the type of posting in an abstract form - irrespective of the chart of accounts. For each type of posting, you define the document type, posting key, account symbols, and the posting category. The posting category indicates the type of account to which the posting should be made (for the debit and credit sides respectively):

1: Balance sheet account (from account assignment reference) 2: Subledger account (Customer) 3: Bank (clearing) account 4: Profit/loss account (G/L account with cost center) 5: G/L account (G/L account without cost center)

2 You then assign actual G/L accounts to the account symbols, or make any necessary changes to the account entries. Posting category 1 is an exception - in this case, the system automatically replaces the account symbol for the balance sheet account with the balance sheet account defined in the account assignment reference. As a result, the account cannot be changed.

Note: The entry "+" for the payment transaction is a generic entry. This means that the account determination settings for this entry are only used if no account determination settings with another payment transaction (x, 1, or 2) apply to the flow type.

© SAP AG AC816 5-31

SAP AG 1999

Accounts Posting specs

Application 0101 Treasury: Loans

Acct symbol Description:#

3

4.1.35.2.2

1

:

::

Determine autom.Balance sheet acctBank clearing

Interest paidInterest payable (liab.)

::

Symbols

3.1 Bank (replacement)

Account Determination: (Account) Symbols

Account symbols

Account symbols describe a group of G/L accounts. They are used to summarize postings of the same type (for example, write-down expenses).

The symbols can be used for several different sets of posting specifications. Differentiated postings are achieved by selecting different G/L account assignments.

You need to reserve a symbol for internal automatic determination of specific data. This is relevant for the postings for the contract currency changeover, for example.

© SAP AG AC816 5-32

SAP AG 1999

Accounts

Posting specs Symbols

Application 0101 Treasury: Loans

Acct symbol

Chart of accts International chart of accounts

Acct assignment ref. Currency G/L acct

INT

::

::

33

4.1.35.2.2

+++++

+USD+++

113105113155++++++++++5220000179100

Chart of accounts INT

Account assignment

3.1

Account Determination: Account Assignment

You assign one or more G/L accounts for the relevant chart of accounts to the account symbol. The multiple assignment is based on the currency and/or the account assignment reference. This permits differentiated settings for the various posting activities. Example: A loan is disbursed. If the contract currency is USD, the system selects account 113155 on the basis of the account determination settings; for other currencies, account 113105 is selected.

If the value for the payment transaction indicator is "X" (posting to a customer account), you must specify all of the accounts to which postings are to be made explicitly in the account block. The system determines the bank account during the payment run on the basis of the rules defined for the payment run.

If the value for the payment transaction indicator is "1" (no house bank account defined), you also have to specify the bank account in the account block. (Example: Account symbol 3, account specification: 113105 or 113155)

If the value for the payment transaction indicator is "2" (house bank account defined), you can still change the account specified in the transaction via the account block. You can use the replacement rule to do this (Example: Account symbol 3.1, account masked). Example: A loan is disbursed (not posted to a customer account). Current account 113100 is entered in the payment details. Since a preliminary in-house posting is made to a bank clearing account, the current account specification in account determination is changed. The last character is replaced by a "5", and the disbursement is posted to account 113105.

© SAP AG AC816 5-33

SAP AG 1999

Mortgage loan: 25 years, disbursem. 150,000.00 -> acct ass. ref. 1.2.1

May 01 Loans from fin. inst. 150,000.00May 01 1001 Disbursements 150,000.00

Bank clearingBank clearing 113105 113105

D150,000.00

Balance sheet account acc. to account assignment ref.

Loans from fin. inst. 62120Loans from fin. inst. 62120

Disbursementobligation

D

40 Debit Bank clearing

50 Credit Payables

Flow type

Posting specificationsPosting specifications

1001 / 2

C

150,000.00

C

Postings: Account Determination

For each flow that is relevant for posting, the system determines the corresponding posting specifications via the flow type.

The posting specifications control how individual business operations are posted. They contain the rules for posting and account determination for each flow type, and are dependent on the account assignment reference and the currency.

The posting specifications contain control information which is transferred directly to Financial Accounting, such as the document type and the posting keys for the debit and credit sides of the posting. They also include the posting category and account symbols, which are required to determine the specific G/L and subledger accounts using the loans posting interface.

© SAP AG AC816 5-34

SAP AG 1999

Exercise: Account Determination Settings

© SAP AG AC816 5-35

SAP AG 1999

Characteristic 2

Determination of Account Assignment Reference -Overview

Assign account assignment references to the combinations selected

Selection for automatic determination of theaccount assignment reference

(All) combinations of value groups

ABC

DE

1

2

Value groups > Values

Characteristic 1

When you create a transaction, you need to enter information about the balance sheet account to which the posting is to be made later on. In the loans area, the system determines the account assignment reference automatically. The system reads certain characteristics in the transaction, and determines the account assignment reference automatically on the basis of the values defined for these characteristics.

© SAP AG AC816 5-36

SAP AG 1999

Company code 0019Contract type 1 LoansProduct category 300 Mortgage loan

Business partner numberPosting system indicator for borrower's notesLoan type indicatorLoan class indicatorObject typePurpose of loanCurrency....

....

Selectable characteristics

Loan maturityProduct type

Selected characteristics

Val.grp Comment

Value CommentValue groups

Values

Double-click

Example

123

Less than 1 year1 to 5 yearsMore than 5 years

010203

*

Term less than 1 yearTerm 1 -3 yearsTerm 3 -5 yearsOther

Determination of Account Assignment Reference:Characteristics

The system determines the account assignment reference automatically on the basis of certain characteristics that are selected in Customizing. You define values for the characteristics, and put these values into value groups.

You make the settings for automatic determination of the account assignment reference in the company code, either for the selected product category, and/or for the contract type "loans" (in other words, for all product categories). The account assignment reference is determined in two steps: 1. If an entry exists at product category level, the system uses this account assignment reference. 2. If no entry is found for the product category, the system uses the account assignment for the contract type. If the system is unable to find settings for either 1. or 2., an error message appears.

© SAP AG AC816 5-37

SAP AG 1999

Maturity Val.grp Product type

Account assignment reference allocation

Combination

AcctAssRef

Val.grp Maturity Val.grp Product type

Val.grp

Select and copy

Enter and save

0001 Less than 1 year 0001 Mortgage loan given0001 Less than 1 year 0002 Mortgage loan taken0002 1 to 5 years 0001 Mortgage loan given0002 1 to 5 years 0002 Mortgage loan taken0003 More than 5 years 0001 Mortgage loan given0003 More than 5 years 0002 Mortgage loan taken

30A<1 0001 Less than 1 year 0001 Mortgage loan given30B<1 0001 Less than 1 year 0002 Mortgage loan taken30A 1-5 0002 1 to 5 years 0001 Mortgage loan given30B 1-5 0002 1 to 5 years 0002 Mortgage loan taken

Determination of Account Assignment Reference:Allocation

Using the values and value groups defined for the characteristics selected, the system displays all of the combinations of value groups that can be used for automatic determination of the account assignment reference. You then allocate account assignment references to the combinations selected.

© SAP AG AC816 5-38

SAP AG 1999

Exercise: Automatic Determination of AccountAssignment Reference

© SAP AG AC816 5-39

SAP AG 1999


Treasury

Treasury Management

Cash Management

Securities

Loans

TR-CMDefine account groupsPlanning levels(bank/subledger)

TR-LO LoansFlag flow types asrelevant for CashManagementAssign planning levels

Customizing: Integration With TR CashManagement

© SAP AG AC816 5-40

SAP AG 1999

FTyp

Name1000 Purch.

L_Interest pay.1110

Flow type 1001

Posting

Posting controlIncoming pmnt

1

1001 L_Loan disbursement rec.

L_Disbursement

Grouping

InflowFlow category

Flow types

Other

Relev. to CMx

...

Double-clickFTyp

Define flow types

Integration: Cash Management - Loans I

You need to flag the flow types for the loan activities you want to include in Cash Management as Relevant to CM.

© SAP AG AC816 5-41

SAP AG 1999

PTyp Sta ACat Level (bank known) Level (bank unknown)30A 60 0 LB LP31A 60 0 LB LP31B 60 0 LB LP32A 60 0 LB LP33A 60 0 LB LP

: :

Treasury : Assign Planning Levels

Company code 0001

33B 60 0 LB LP

Integration with Cash Management - Loans II

You assign planning levels for each company code and product type. They indicate the logical origin of the cash flows in the accounts. Only the Status column is relevant for Loans Management.

The Bank known level is relevant for non-customer postings (cash position), the Bank unknown level is relevant for postings made to customer accounts (liquidity forecast).

© SAP AG AC816 5-42

SAP AG 1999

Loans Bank clearing

Loan is flagged as 'disbursed' in the system.

However, the borrower has not yet received the payment.

150,000 146,5001 1

Other

3,5001

Postings: Disbursement from Lender

(1) The contract is disbursed.

The contract is flagged as disbursed within the Loans component.

At this point, however, the borrower has not yet received the disbursement payment (internal posting).

When the lender transfers the money, the incoming payment appears on the borrower's bank statement.

The contract is flagged as "disbursed" as soon as you save a disbursement.

© SAP AG AC816 5-43

SAP AG 1999


Post disbursement



05/01/YY 146,500 Loan disbursement P 1001


05/01/YY 146,500 Loan disbursement I 1001

'Planned record'

'Actualrecord'

Wait for bank statement, then post incoming payment

Loan disbursed

Planned Record -> Actual Record

Flows that have been entered but not posted are displayed as P - planned record in the cash flow. Records that have been posted are displayed as I - Actual record.

When you post a disbursement, you have only completed the posting transaction. The bank statement indicates when the incoming payment was actually credited.

© SAP AG AC816 5-44

SAP AG 1999

Payment Options

Payment received from lender

By bank transferor

by check

Bank statement

BANK FileNote to payee

~~~~~~~~~~

BANK

Automatic bank statement Manual bank statement/

If the lender pays by bank transfer, you receive the money and the related information with the bank statement from your house bank.

© SAP AG AC816 5-45

SAP AG 1999

Accountstatement

Manualentry

Interimdataset


Subledgeraccountingdocuments

Postdirectly

Incoming Transfer: Example of a Manual BankStatement

Once the payment appears in the bank statement, the flows for the corresponding account are updated in the system. On the basis of the data entered, the system generates an interim dataset, which then has to be posted. The flows can either be posted directly, or at a later stage using batch input. The postings always affect the general ledger (bank account and bank clearing account), and may affect the subledger (customer).

© SAP AG AC816 5-46

SAP AG 1999

Loans150,000

Bank clearing 146,500 2

1

1 2

Bank146,500146,500

Other3,5001

Postings: Bank Statement


(2) The incoming payment for the disbursement is posted on the basis of the bank statement.

© SAP AG AC816 5-47

SAP AG 1999

Process (post) the disbursement for a loan youhave entered

Configure the system in such a way that postingactivities can be carried out correctly


Disbursement: Unit Summary

© SAP AG AC816 5-48

Disbursement Exercises

Unit: Disbursement


• Enter loan disbursements

• Make product type-specific settings for posting

• Make the relevant posting settings in Customizing

The loan you have taken out is disbursed. You also want to make Customizing settings in advance for another loan you expect to receive.

1 You receive the disbursement payment for the loan you have taken out.

1-1 Enter a posting text and execute the disbursement posting.

• Compare the display in Cash Management before and after the posting.

• Have a look at the posting for the contract disbursement.

• Make a note of the document number.

1-2 Go back to your contract and look at the cash flow. What changes can you see?

2 For your new product type DXX you want to make the relevant settings for posting in FI. Make the settings as follows:

2-1 Actual records in Treasury, posting in FI without customer

2-2 When a loan is entered, postings should be possible from contract status.

© SAP AG AC816 5-49

3 Set up the posting for a special charge. Configure account determination for the new flow type SXX in the same way as for the existing flow type 6145.

To do this, copy the existing flow type 6145 (L_Processing charges Pay.) using payment transaction 2.

Copy to:

Flow type: SXX

Payment transaction: 2

Consider the effect of these settings on the posting.

4 The system determines the account assignment reference automatically on the basis of the product type. Check the settings for automatic determination of the account assignment reference for your new product type DXX for general loans.

© SAP AG AC816 5-50

Disbursement Solutions

Unit: Disbursement


• Enter loan disbursements

• Make product type-specific settings for posting

• Make the relevant posting settings in Customizing

1-1 Cash Management: → Treasury

→ Cash Management

→ Information System

→ Reports for Cash Management

→ Liquidity Analyses

→ Cash Position

The contract only appears in Cash Management after you have saved/posted the disbursement.

Disburse contract → Accounting

→ Treasury → Loans → Transaction Management → General Loan → Contract → Disburse

Cash Management

See above

© SAP AG AC816 5-51

1-2 Display cash flow → Accounting

→ Treasury → Loans → Transaction Management

→ General Loan → Contract → Display

2 Company code-specific settings for product type

2-1 Define posting data for the product type (Customizing)

→ Treasury → Treasury Management

→ Loans → Transaction Management → Product Types → Company Code-Dependent Settings for Product Type


FI posting 4

2-2 Define posting data for the status (Customizing)


In this screen:

→ Define Status per Product Type


FI 4

© SAP AG AC816 5-52

3 Define Account Determination


→ Loan → Functions → Accounting → General Ledger Update

→ Define Account Determination

Go directly to the existing flow type 6145 (payment transaction "2") using the Position function.

→ Edit → Copy

4 Automatic determination of the account assignment reference


→ Loans → Functions → Accounting → General Ledger Update

→ Control Automatic Determination of Account Assignment Ref.


Company code TRXX

Product category 330

• Assignment criteria:

• Characteristic "Product type"

• Value group 2 "General loan taken"

• Value: "DXX"

© SAP AG AC816 6-1

SAP AG 1999

Generating due items

Entering outgoing payments to the lender

Contents:

Payments Due

© SAP AG AC816 6-2

SAP AG 1999

Make outgoing payments


Payments Due: Unit Objectives

© SAP AG AC816 6-3

SAP AG 1999

Disbursement

Closing operations

Condition changes




Course overview



Loan contract

Payments due


© SAP AG AC816 6-4

SAP AG 1999

Interest and repayments on the loan received aredue at the end of the month.

We make the payments due:− By authorizing the lender to debit the

amounts due directly or

− By bank transfer (active payment)

Payments Due: Business Scenario

© SAP AG AC816 6-5

SAP AG 1999


- Create loan- Business partners- Conditions- Loan: Disbursement / posting- Integration with CM- Integration with FI- Generate due items- Outgoing payments

Appli-Appli- Offer Offer ContractContract Disburse-Disburse- Other RolloverRollovercationcation mentment data


© SAP AG AC816 6-6

SAP AG 1999


Post interest/repayments due"Debit position"or"Credit position"

Contract disbursement

Application / Offer / Contract

Bank statement

Outgoing payments

Example of Process Flow: "Credit Position" andOutgoing Payments

The term "debit position" comes from the loans given area, and means generating receivable items due; receivables are posted to the debit side, hence the term "debit position".

In the case of loans taken, generating payable items due is referred to as a "credit position". However, the term "debit position" is often used to refer to the credit side as well.

© SAP AG AC816 6-7

SAP AG 1999

Credit position

Execute Posting: Mass Processing

--> Post Planned Records

Execute Posting: Per Contract

--> Post Individual Loan

Credit Position: Mass Processing <-> Per Contract

© SAP AG AC816 6-8

SAP AG 1999

MM/DD/YY Interest 500 UNIMM/DD/YY Repayment 1,000 UNI

Cash flow

PP

Post planned records as at the due date: P --> IThe system generates due items, ---> "credit position"

MM/DD/YY Interest 500 UNIMM/DD/YY Repayment 1,000 UNI

Cash flow

II

Bal. sheet acct

1,000

Bank clearing account /PR clearing account

1,500

Interest paid

500

Posting Planned Records - General Description

When you carry out an automatic credit position run, the system processes both planned records resulting from the cash flow and postings entered and released manually in subsequent posting applications (such as disbursement). The items due are posted according to the settings in account determination.

Exception: The system does not select the items with the posting control key '21' (manual debit position).

© SAP AG AC816 6-9

SAP AG 1999

Exercise: Taking Out a New Loan

© SAP AG AC816 6-10

SAP AG 1999

Company code 0001 toProduct type 33B toLoan number to Only disbursed loansSelection of loans by currency and interest calc. type

LC loans with reference interest rateLC loans with other interest calculation

Loans acc. to plan principleLoans acc. to actual principle

Only display loans not updated

Preparation for the Credit Position Run:Update Planned Records

The planned record update function regenerates the cash flow on the basis of the defined conditions and the postings that have been made, and writes the planned records to the database.

You can also use this function to carry out interest rate adjustments. When you start this report, the system adjusts any amounts which depend on reference interest rates to reflect the reference interest rates currently defined in the system. The same principle applies to foreign currency loans; the planned records update recalculates the planned records using the current exchange rate in the system.

When you create a contract, the system writes the cash flow for the CM period to the database (see Customizing for the product type). However, if the fixed period ends before the CM period, the cash flows are only written to the database up to the end of the fixed period.

You should run this program for all loans at least every six months, in order to make the cash flow available for the full CM period. Loans which depend on reference interest rates or foreign currency loans obviously need to be updated more frequently to ensure that the current values are calculated before posting.

Note: For loans taken, you should only used the planned principle

© SAP AG AC816 6-11

SAP AG 1999

Payment made to lender


Bank statement

By bank transfer orby check

By direct debit

Payment Options

The processing steps for paying the amounts due depend on the payment method you choose: If you opt for direct debit, the lender debits the money from your account, and you receive the debit information with the bank statement from your house bank. If you pay by check or bank transfer, you trigger the payment using the payment run for payment requests. The money is transferred using the payment media generated by the payment program. The account statement data informs you about the outgoing payment.

© SAP AG AC816 6-12

SAP AG 1999


000110000000

Posting control

Automatic Credit Position: Posting PlannedRecords

Test runLog

Posting dateDocument text

Pmnt methodUp to and including due date

Loan credit position06/30/YY

?

The automatic debit position run selects all the due items for the contracts specified on the selection screen. It posts all the planned records for the selected loans that are due either on or before the date in the Up to and including due date field. (You have already defined whether the debit position should be generated manually or automatically on the detail screen for the contract conditions.)

You can simulate the run to check the results by setting the Test run indicator.

All planned records from contracts that have not been released and that do not have the posting control indicator '01' (automatic debit position) are excluded from the selection.

If errors occur during the debit position run, the system does not process any of the planned records selected for the corresponding main loan partner. In this case, the system omits the contract that caused the error as well as any other contracts with the same borrower.

© SAP AG AC816 6-13

SAP AG 1999

CoCd Doc.no. Date Doc.type Cont. type Cont. no. FlowTypePK Acct G/L Curr.CoCd Doc.no. Date Doc.type Cont. type Cont. no. FlowTypePK Acct G/L Curr.

Posting logLoan debit position09/01/YY

Posting logLoan debit position09/01/YY

00000100000001SA06/30/YY000140

40

220000Interest expense

625.00 D 1110

1125965.98 D62120Bal. sheet account

UNI

UNI

625.00 C

965.98 C

113105

113105Bank clearing

Bank clearing

50

50 UNI

UNI

Automatic Credit Position: Example - Direct Debit

The above example shows a posting log for interest and repayment postings.

© SAP AG AC816 6-14

SAP AG 1999

Loans

150,000


1

1 2

Bank146,500146,500

Other3,5001

965.983

3965.98

625.00

Interest paid3

625.00 3

Credit Position (Example: Direct Debit)



(3) Posting of the amounts due (debit position or credit position)

© SAP AG AC816 6-15

SAP AG 1999

Bankstatement

Manualentry

Interimdataset


Subledgeraccountingdocuments*

Postdirectly

Manual Bank Statement:Example: Payment is Debited

Once the payment appears in the bank statement, the flows for the corresponding account are updated in the system. On the basis of the data entered, the system generates an interim dataset, which then has to be posted. The flows can either be posted directly, or at a later stage using batch input. In the case of loans taken, the postings only affect the general ledger (bank account and bank clearing account).

. * In the case of loans given that are managed on the basis of customer accounts, postings are also made to the subledger (customer account).

© SAP AG AC816 6-16

SAP AG 1999

Loans

150,000


1

1 2

Bank146,500146,500

Other3,5001

965.983

3965.98

625.00

4

Interest paid3

625.00 3

41,596.98

1,596.98

Bank Statement (Example: Direct Debit)




(4) Posting of the bank statement, which indicates that the amounts have been debited

© SAP AG AC816 6-17

SAP AG 1999

Exercise: Making Payments Due

© SAP AG AC816 6-18

SAP AG 1999

Automatic Credit Position: Posting PlannedRecords


000110000000

Posting control

Test runLog

Posting dateDocument text

Pmnt methodUp to and including due date

Loan credit position06/30/YY

?

The automatic debit position run selects all of the due items in the contracts specified on the selection screen. It posts all the planned records for the loans selected that are due either on or before the date in the Up to and including due date field. (You have already defined whether the debit position should be generated manually or automatically on the detail screen for the contract conditions.)

You can simulate the run to check the results by setting the Test run indicator.

All planned records from contracts that have not been released and that do not have the posting control indicator '01' (automatic debit position) are excluded from the selection.

If errors occur during the debit position run, the system does not process any of the planned records selected from the corresponding main loan partner. In this case, the system omits the contract that caused the error as well as any other contracts with the same borrower.

© SAP AG AC816 6-19

SAP AG 1999

Posting logLoan credit position09/01/YY

Posting logLoan credit position09/01/YY

00000100000001SA06/30/YY000140

40

220000Interest expense

625.00 D 1110

1125965.98 D62120Bal. sheet account

UNI

UNI

625.00 C

965.98 C

118888

118888PR clearing acct

PR clearing acct

50

50 UNI

UNI

Automatic Credit Position: Example - BankTransfer

CoCd Doc.no. Date Doc.type Cont. type Cont. no. FlowTypePK Acct G/L Curr.CoCd Doc.no. Date Doc.type Cont. type Cont. no. FlowTypePK Acct G/L Curr.

The above example shows a posting log for interest and repayment postings.

© SAP AG AC816 6-20

SAP AG 1999

Loans

150,000


1

1 2

Bank146,500146,500

Other3,5001

965.983

3965.98

625.00

Interest paid3

625.00 3

PR clearing

Credit Position (Example: Bank Transfer)




© SAP AG AC816 6-21

SAP AG 1999

Paymentadvicenote

Transfer

Eurocheck

Check

Editproposal

Currentparameters

Paymentcontrol

Paymentsummary

Print program

MasterDocu-ments

IDOC

Automatic Payments: Payment Program for PR

Proposal dataset

Print dataset

Payment run

Proposal run

PmntPmntreq.req.

Functions of the payment program for payment requests:

Payment request processing (PR): Automatic selection of requests

Generation of payment documents (customer accounts / vendor accounts / G/L accounts): (Transfer) posting to the corresponding bank (sub-) accounts for each house bank and currency

Generation of payment data

Generation of payment lists and logs

"Print programs" process this payment data to generate payment media, such as checks

You usually carry out a payment proposal run first. The system generates a proposal dataset, which you can then check and edit before the actual payment run.

© SAP AG AC816 6-22

SAP AG 1999

Loans

150,000


1

1 2

Bank146,500146,500

Other3,5001

965.983

3965.98

625.00

Interest paid3

625.00 3

PR clearing

4

4

1,596.98

1,596.98

Postings: Payment Program for Payment Requests




(4) Payment program for payment requests; generation of payment media; presentation of the bank transfer to the house bank

© SAP AG AC816 6-23

SAP AG 1999

Bankstatement

Manualentry

Interimdataset


Subledgeraccountingdocuments*

Postdirectly

Manual Bank Statement:Example: Outgoing Bank Transfer

Once the payment appears in the bank statement, the flows for the corresponding account are updated in the system. On the basis of the data entered, the system generates an interim dataset, which then has to be posted. The flows can either be posted directly, or at a later stage using batch input. In the case of loans taken, the postings only affect the general ledger (bank account and bank clearing account). * In the case of loans given that are managed on the basis of customer accounts, postings are also made to the subledger (customer account).

© SAP AG AC816 6-24

SAP AG 1999

Loans

150,000


1

1 2

Bank146,500146,500

Other3,5001

965.983

3965.98

625.00

Interest paid3

625.00 3

PR clearing

5

4

1,596.98

1,596.98

1,596.98

1,596.98 4

5

Bank Statement (Example: Bank Transfer)




(4) Payment program for payment requests; Generation of the payment media; presentation of the bank transfer to the house bank

(5) Posting of the bank statement, which indicates that the payment has been transferred

© SAP AG AC816 6-25

SAP AG 1999

Payment Requests: CustomizingPayment Requests: Customizing

Maintain the number range for payment requests

Set up and assign the Cash Management planning levelfor payment requests

Define the clearing account for payment requests in thechart of accounts

Assign this clearing account to the company code

Standing Instructions: Set the Payment request andIndividual payment indicators, as required; Enter apayment method in the Payment methods field

...

© SAP AG AC816 6-26

SAP AG 1999

- Preparation for credit position run: Planned record update

- Execute credit position run

1. Generate due items

- Payment by direct debit: Wait until amount is debited: Import bank statement

or

- Payment by bank transfer: Start payment program Payment is transferred: Import bank statement

2. Pay amount due

Outgoing Payments: Summary

Before you carry out the debit position run, you must carry out a planned record update in order to update the planned record amounts for foreign currency loans (exchange rate) as well as variable interest loans (reference interest rate).

How the payments due are actually processed depends on what you have agreed with the lender (direct debit / bank transfer / check).

© SAP AG AC816 6-27

SAP AG 1999

EvaluateEvaluateAccount statement

Posting journal

Accounting - Evaluations

The Account statement function displays all the postings relating to a particular contract.

The Posting journal function displays all the postings for the loans area.

© SAP AG AC816 6-28

SAP AG 1999

Exercise: Posting Journal

© SAP AG AC816 6-29

SAP AG 1999

Account statement Date 07/01/YY

From: 01/01/YY to: 12/31/YY

10000000 Citibank, Hamburg

Pstg date05/01/YY05/01/YY05/01/YY05/30/YY05/30/YY

Pmnt date05/01/YY05/01/YY05/01/YY06/30/YY06/30/YY

Doc.no.999

1414

RIn FTyp10011165336511101125

NameDisbursementDisc. deb. pos.Disc. withheldInt. deb. pos.Ann. repmnt

Debit150,000.00 3,000.00

625.00 965.98

Credit

3,000.00

FI document Loandocument

Evaluations: Loan Account Statement

You can use the Account statement function to display all the relevant posting information for a loan or for all the loans for one partner. You can change the time period in the display.

From the account statement, you can branch to the corresponding FI (G/L) and loan (subledger) documents.

© SAP AG AC816 6-30

SAP AG 1999

Make outgoing payments


Payments Due: Unit Summary

© SAP AG AC816 6-31

Payments Due Exercises

Unit: Payments Due


• Make outgoing payments

You take out another loan. Interest and repayments become due.

1 To finance another investment, you take out a new loan. The lender is the Deutsche Bank. To enter the loan in the system, use the newly-defined product type DXX. You make the following arrangements:

• General loan

• Term: 5 years

• Corresponding commitment date

Condition header:

• Commitment capital: 100,000 UNI

• Disbursement rate: 99%

• Discount calculation: Total amount with the first disbursement

• Fixed for 5 years

• Annuity repayment

• Interest calculation method: 360/360

• Effective interest method: PAngV

© SAP AG AC816 6-32

Individual condition items:

• Nominal interest rate: 5.2 %

• Exact payment frequency: Monthly, payable at the end of the month

• Annuity repayments: Monthly, payable at the end of the month, instalment calculated by the system

• Repayment settlement: Quarterly, at the end of the quarter

2 Post the disbursement for the loan.

3 The next interest payment and repayment are due. You have arranged to pay the interest and repayments by direct debit.

3-1 Update the planned records.

3-2 Post the interest and repayments due automatically.

4 Call up the posting journal, and look at the postings.

© SAP AG AC816 6-33

Payments Due: Solutions

Unit: Payments Due


• Make outgoing payments

1 Create a new loan

→ Accounting → Treasury → Loans → Transaction Management → General Loan

→ Contract → Create

2 Post disbursement

→ Accounting → Treasury → Loans → Transaction Management

→ General Loan → Contract

→ Disburse

3-1 Planned record update

→ Accounting → Treasury → Loans → Portfolio → Periodic Processing → Update Planned Records

© SAP AG AC816 6-34

3-2 Post interest payments and repayments:

→ Accounting → Treasury → Loans → Accounting → Execute Posting: Per Contract → Post Individual Loan

Check your entry for the due date.

4 Posting journal

→ Accounting → Treasury → Loans → Accounting → Accounting Evaluations

→ Posting journal

© SAP AG AC816 7-1

SAP AG 1999

Accruals/deferrals

Valuation

Summarization

Information system

Customizing:− Accruals/deferrals− Valuation− Information system

Contents:

Closing Operations

© SAP AG AC816 7-2

SAP AG 1999

Carry out an accrual/deferral run for a loanposition and value the position for accountingpurposes

Use the summarization function to improveperformance

Use the information system


Closing Operations: Unit Objectives

© SAP AG AC816 7-3

SAP AG 1999

Payments due

Condition changes




Course overview



Loan contract

Disbursement

Closing operations


© SAP AG AC816 7-4

SAP AG 1999

At the end of the month, you want to create interimfinancial statements. In order to do this, you needto carry out an accrual/deferral run and a valuationrun for the loan position.

Closing Operations: Business Scenario

© SAP AG AC816 7-5

SAP AG 1999


- Create loan- Business partners- Conditions- Loan: Disbursement / posting- Integration with CM- Integration with FI- Determine amounts due- Outgoing payments

Appli-Appli- Offer Offer ContractContract Disburse-Disburse- Other RolloverRollovercationcation mentment data

- Accruals/deferrals- Valuation- Summarization- Information system


© SAP AG AC816 7-6

SAP AG 1999

Accruals/deferrals:- Reset procedure (for interest etc.; for discount)- Difference procedure (for discount)

Reverse accruals/deferrals

Reset accruals/deferrals (for reset procedure)

Accruals/Deferrals: Overview

You calculate accruals and deferrals in order to assign receipts and expenditures to the correct accounting period.

The accrual/deferral procedure determines how the postings are made to the relevant expense and revenue accounts. In a selection screen, you specify the transactions for which you want to perform the accrual/deferral run and the accrual/deferral key date. The system then selects the flows from these transactions that are relevant for accrual/deferral up to this date. For each flow, it calculates the accrual/deferral amount and generates accrual/deferral flows. You can carry out the accrual/deferral run as a test run (accrual/deferral log), or post the accruals/deferrals immediately (accrual/deferral log and posting log).

If you carry out accruals/deferrals using the reset procedure, you reset the accruals/deferrals using the Reset Accrual/Deferral function.

You can reverse accruals that have been posted or reset using the Reverse Accrual/Deferral function. If you have posted an accrual/deferral and a reset, you have to reverse the reset before you can reverse the accrual/deferral. If you want to reverse several discount deferrals, you must proceed in reverse chronological order.

© SAP AG AC816 7-7

SAP AG 1999

Reset procedure(R/3 Loans: for interest etc.,for discount)Difference procedure(R/3 Loans: For discount)

Linear (proportional totime)

Proportional to interest

Financial mathematical*

Accrual/deferralprocedures

Accrual/deferralmethods

* Not relevant for the loans area

Accruals/Deferrals: Procedures/Methods

The accrual/deferral procedure determines how the postings are made to the relevant expense and revenue accounts.

If you use the reset procedure, you post the portion of the flow that is relevant for the accounting period as at the key date, and then reset the posting directly afterwards (usually on the next working day).

If you use the difference procedure, the posting is not reset. In this case, the next time you carry out an accrual/deferral run, the system only posts the difference.

The accrual/deferral method determines how the accrual/deferral amounts are calculated.

The linear calculation is proportional to time.

The interest-based method calculates the discount deferral in proportion to the ratio of the interest due for the accrual/deferral period to the total remaining interest. This method is supported for discount deferral. The financial mathematical method is not supported for the loans area.

© SAP AG AC816 7-8

SAP AG 1999

Accrual/deferral as part of closing operations

11/01Payment date

for interest1,200 UNI

12/31Accrual/deferral

key date

04/30Due date

for interest1,200 UNI

11/01: Interest payment in advance, 1,200 UNI

Financial statements created as at 12/31 -> Deferral of 800 UNI

01/02

Reset

01/02: Deferral of 800 UNI is reset

Accruals/Deferrals: Reset Procedure

The above example illustrates a deferred interest payment.

This amount has to be deferred when a period is closed in order to prepare financial statements. 11/01: Flow type 1110: Debit position: Interest expenses to Bank clearing 1200 UNI Outgoing payment: Bank clearing to Bank 1200 UNI 12/31: Flow type 8804: Deferral: Deferred expenses to Interest expenses: 800 UNI 01/02: Flow type 8823: Reset deferral: Interest expenses to Deferred expenses: 800 UNI 04/31: -

© SAP AG AC816 7-9

SAP AG 1999

Company codeProduct typeLoan number 10000001

tototo

X

Control parameters

Accruals/Deferrals: Execute

000133B

Test run

Discount/premium acc./def.Other accruals/deferralsAccrual/deferral key date 12/31/YY

© SAP AG AC816 7-10

SAP AG 1999

Linear

8801

0001

1

Company codeFlow typeAcc./defer. method

1110 L_Interest pay.

Reset procedure

8821

8804

8823

Accrual

Accrual reset

Deferral

Deferral reset

L_Acc.: Expense to other liab.

L_Acc.: Other liab. to expenses

L_Def.: Def. exp. to expenses

L_Reset def.: Exp. to def. exp.

-> Check account determination

Customizing: Accruals/Deferrals I

Difference procedure

You maintain the flow types to be considered for accrual/deferral in a special table. For each flow type that is relevant for accrual/deferral, you have to define the accrual/deferral method and the accrual/deferral procedure. For the procedures, you need to specify the corresponding accrual/deferral flow types for posting. You also have to make the corresponding settings in account determination for all the flow types. Example: 1110 Interest: Interest expenses to Bank clearing 8804 Deferral: Deferred expenses to Expenses 8823 Reset Deferral: Expenses to Deferred expenses

© SAP AG AC816 7-11

SAP AG 1999

0001Company codeFlow type 1165 L_Discount pay.

Interest base for flow type

Int. base Name1110 L_Interest pay.

Customizing: Accruals/Deferrals II

If you want to create a discount deferral in proportion to the interest, you must also define the interest amounts (condition type) upon which the calculation should be based.

The interest-based calculation calculates the discount deferral in proportion to the interest amount. Calculation basis: Ratio numerator/denominator:

Numerator: Total interest (from disbursement date or last accrual/deferral date up to the current date)

Denominator: (from the disbursement date or last accrual/deferral date up to the Fixed until date in the condition header).

© SAP AG AC816 7-12

SAP AG 1999

Maintain exchange rates Valuation log Posting log

Foreign currencyloans:Position valuation

Valuation: Position Valuation

To produce (monthly or quarterly) financial statements, you need to value any foreign currency loans. You can value loan positions at any key date. The key date valuation function values the positions as at a certain key date for accounting purposes using the exchange rate valid on this key date.

You set the valuation parameters in Customizing.

© SAP AG AC816 7-13

SAP AG 1999

Product typeContract currency...

tototo

...

...

...

Selections

Company codeContract number

toto

Parameters for foreign curr. valuation

Key date

Valuation principle

Rate calculation

Simulation/testReset valuation

Position Valuation: Initial Screen

You choose the loan positions to be valued for accounting purposes via the selection criteria.

Parameters:

Key date: The valuation is based on the position and the exchange rate as at this date.

Valuation principle: Principle defined in Customizing that determines whether a write-up or write down is permitted/mandatory if there is a difference between the book exchange rate and the valuation exchange rate.

Rate calculation indicator: Determines which rate type is used (example: M = middle rate).

Simulation/Test: You can carry out the valuation as a simulation run, a test run or an update run: If you simulate the valuation, the system displays a valuation list. If you carry out a test run, the system checks the account determination settings and displays both the valuation list and the (test) posting log. In the update run, the system makes the relevant postings and transfers them to Financial Accounting.

If the Reset valuation indicator is set, the system resets the valuation postings automatically on the following day (key date + 1). This function is useful when you carry out interim valuations for information purposes.

© SAP AG AC816 7-14

SAP AG 1999

Posting log

TR00 1000006 30BUSD 100,000.00 150,000.00 1.50000

140,000.00 1.40000147,000.00 1.47000

7,000.00+ 140,000.00 1.40000

CoCd Loan numberCurrency Rem. capital Acquisition value Acquis. rateExch. rate date Curr. Value Curr. price

Old book value Old book rateValuation gain/loss New book value New book rate

Valuation log

Position Valuation: Logs

40 62120 UNI 7,000.00 DMortgage loans taken

50 230010 UNI 7,000.00 CUnrealized gains fr. curr. valuation

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Valuation principle

Valuation method Valuation rules

11

One-step Two-step

22 33- 0 None - 0 None- 2 Up to key date value - 2 Up to acquisition

value- 4 Up to key date value

Valuation loss Valuation gain

Valuation: Defining Valuation Principles

For each valuation principle, you define a valuation method and select valuation rules.

The valuation methods are predefined in the system.

Two-step methods are required for valuing securities positions. This allows you to deal with the security price and exchange rate components separately.

In the loans area, only the one-step method is relevant.

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0 No valuation loss1 (Not supported at present)2 Valuation loss up to key date value

0 No valuation gain1 (Not supported at present)2 Valuation gain up to acquisition value3 (Not supported at present)4 Valuation gain up to key date value

Valuation loss

Valuation gain

Valuation: Write-Down / Write-Up Options

You set down the valuation rules for a valuation principle by selecting the relevant write-up and write-down options.

For loans given, a reduction in the loan position resulting from a revaluation (write-down) represents an exchange rate loss. For loans taken, a reduction represents an exchange rate gain. For loans given, an increase in the loan position resulting from valuation (write-up) represents an exchange rate gain. For loans taken, an increase represents an exchange rate loss.

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Valuation principleName of valuation principle

Valuation method 1

Valuation lossValuation gain

Valuation loss up to key date value

No valuation gain

Valuation: Example of the One-Step Principle

Strict lowest value principle101

20

Example: Strict lowest value principle: Full valuation loss, no valuation gain

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SAP AG 1999

Problem: Performance

(in the form of totals records in a separate table)

Cumulation of condition-based, recurring accountingdocuments per flow type in the form of carryforwardrecords

Solution: Summarization of document data

Summarization / Reorganization: Overview

Initial situation: Performance problems for applications with long runtimes as a result of high position volumes and large numbers of documents

Critical points (technical view):

Quantity of documents to be read from the database

Quantity of documents to be processed by the application

Not the number of documents in the database itself!

Solution: Document summarization in the form of totals records (carryforward records) in a separate table

For each loan, the summarization function writes totals records for a given key date from the posted documents to a separate table.

Example: Total repayments to date

Applications that read posted documents and use the data for further processing can then access the carryforward records that have been generated. If there are no valid carryforward records, the application reads the original documents.

Applications that effect changes in summarized periods (for example, reversal) flag the summarization as invalid.

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XXXX

X

Documents Documents

Carryforwardrecords

Carryforwardrecords (II)

Carryforwardrecords (I)

Today

3 months3 years

Performance optimization

Performance optimization and subsequent archiving (future releases)

Administrativedata

Original documents in the systemOriginal documents archivedTime

Archiving Summarization Originaldocuments

Summarization: Carryforward Records

The summarized documents are flagged, and the summarization records are available as "carryforward" records. Summarization information (such as when the records were summarized) is stored as administrative data.

The following applications can work with summarized data:

Update Planned Records

Overview Loans for partner (calculation of capital amounts)

Accrual/Deferral

Planned: successive integration in further applications

You should select a summarization period that lies approximately 3 - 5 months in the past. This reduces the probability that subsequent business transactions will affect the summarized period.

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SAP AG 1999

Company codeContract number

Call type

Carry out summarizationInvalidate summarized recordsDelete summarized recordsDisplay information

Summarization: Call Types

The following call types are available:

Carry out summarization

Invalidate summarized records: The summarization for the loans selected is flagged as invalid. The summarization records remain on the database. Example: If, after the summarization has been carried out, you make a posting that falls within the summarization period, the summarization records are no longer up-to-date; they are automatically invalidated by the application.

Delete summarized records: The summarized records are deleted from the database.

Display information

Because of the long runtime and problems with blocks, you should carry out the summarization in the background when the system is not being used online.

© SAP AG AC816 7-21

SAP AG 1999

Reportsdelivered with

the SAP System

User-definedreports

Cumulative values Non-cumulative values

Information System: Overview

In addition to using the reports delivered by SAP, you can define your own evaluations.

© SAP AG AC816 7-22

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Loans Management

AccountingAccounting evaluations

Account statementMaturity list for posted documentsBalance listPosting journalCustomer account

Display line itemsAnalysis

Information systemTransactionPosition/Position trendRevenue analysisAccountingRisk settingsMaster data

Information System: Loans

SAP delivers various reports for the loans area with the system. These reports appear in the relevant sections of the application menu.

Note: The reporting menu contains all the available reports, regardless of the area to which they apply (some reports may only be relevant for loans given, others only for loans taken). Only selected reports are actually available for the loans taken area.

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Exercise: Information System

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B

usin

ess

part

ner

Brown

Miller

Fisher

Report list

Currency

CHF USDDEM

Product type

Policy loansMortgage loans Borr. Note loans

Drilldown Reporting Principle

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Navigation to all levels (characteristics)Exception reporting provides a visual warning wheredeviations are criticalHierarchy processing lets you map external hierarchies(for example, flow type hierarchies)Graphics help you to visualize the figuresAnalysis functions allow you to classify your dataData mining identifies conspicuous values in the datasetautomaticallyCurrency translation determines currency influences

Drilldown Reporting Functions

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Drilldown reporting structures

PART

NER

PRODUCT TYPE Borrowing/sale

1

PRODUCT TYPE

2PA

RTNE

R

CURRENCY

PRODUCT TYPE

CURRENCY

Company codeTraderProduct typePortfolioSecurities account

X

PartnerFinancial transactionCurrencyAcct assignment ref.

X

X

Investment/purchaseX

PART

NER

CURRENCY

Money Money marketmarketForexForex

DerivativesDerivativesSecuritiesSecurities

LoansLoans

3

PART

NER

PRODUCT TYPE

CURRENCY

Multidimensional Dynamic Drilldown Reporting

Within drilldown reporting, you have various navigation options:

Drilldown - enables you to navigate through drilldown reporting levels, changing the order of the characteristics in the search as required.

Change drilldown - allows you to replace one characteristic with another.

Deactivate characteristics - allows you to calculate totals for all the values of any given characteristic.

Sort characteristics - changes the search strategy, in other words, the order in which the system navigates through the characteristics.

Initial list - returns to the the original list.

Detail list - enables you to branch to the details for a selected characteristic value.

Hierarchy - allows you to structure the list as a hierarchy.

© SAP AG AC816 7-27

SAP AG 1999

FormsForms

ListsGraphicsNavigation/drilldown

BatchBatchlistlist

CreateChangeExecute

Drilldown report

...Mail ExcelWinword

ReportReportlibrarylibrary

Drilldown Reporting Architecture

Save

Save

CharacteristicsCharacteristicsKey figuresKey figures

When you define reports, you can enter characteristics and key figures, and create forms. A report generates several lists that can be called up interactively and displayed on the screen. You can also print the reports, export them to Word or Excel, or store them in a file.

The form describes the content and structure of the reports. It serves as the basic framework for a report. You specify the details when you define the report itself.

Characteristics determine the classification options for the dataset, for example, company code, business partner, product type. Additional information relating to characteristics is expressed in the form of attributes (for example, the attribute country for the characteristic business partner).

You can include the characteristics in both the form and the report.

Key figures are not restricted to amounts and quantities; You can use a special key figure function to define additional key figures on the basis of existing ones (key figure tree). Example: Assets = Investment/purchase - Borrowing/sale

You can select the key figures in the form or in the report.

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SAP AG 1999

Carry out an accrual/deferral run for a loanposition and value the position for accountingpurposes

Use the summarization function to improveperformance

Use the information system


Closing Operations: Unit Summary

© SAP AG AC816 7-29

Closing Operations Exercises

Unit: Closing Operations


• Carry out the necessary accruals/deferrals at the end of the period

You are preparing financial statements at the end of the month.

1 To prepare for the quarterly financial statements, carry out an accrual/deferral run for the interest and discount payments as at MM+2.

2 Reset the accruals/deferrals.

3 Gain an overview of the information system.

© SAP AG AC816 7-30

Closing Operations Solutions

Unit: Closing Operations


• Carry out the necessary accruals/deferrals at the end of the period

1 Perform accrual/deferral

→ Accounting → Treasury → Loans → Accounting → Closing Operations → Accrual/Deferral

Carry out the accrual/deferral run for both interest payments and the discount.

2 Reset accrual/deferral

→ Accounting → Treasury → Loans → Accounting → Closing Operations

→ Reset accrual/deferral

Only the interest accruals/deferrals are reset, since the difference procedure is applied to the discount.

3 Information system: Loans

→ Accounting → Treasury

→ Loans → Information System

© SAP AG AC816 8-1

SAP AG 1999

Changing the cash flow

Business operations:- Entering charges individually- Entering charges as a business operation- Unscheduled repayment- Posting individual records

Balance sheet transfer

Capital transfer

Reversal

Customizing

Contents:

Special Cases

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SAP AG 1999

Enter unscheduled and supplementary activitiesin the system

Examples:- Unscheduled repayment- Supplementary charge


Special Cases: Unit Objectives

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SAP AG 1999

Disbursement

Closing operations

Condition changesMaster data



Course overview



Loan contract

Payments due

Special cases


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SAP AG 1999

The lender charges a supplementary fee.

We make an unscheduled repayment.

Special Cases: Business Scenario

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Applic-Applic- OfferOffer ContractContract Disburse-Disburse- Other RolloverRollovercationcation mentment data

- Accruals/deferrals- Valuation- Summarization- Information system- Special cases


© SAP AG AC816 8-6

SAP AG 1999



Correspon-dence

Loans - Cash Flow

Due on Settlement amnt Curr.Name PFTypL_Loan disbursem.L_Interest pay.L_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payable

100,000.001,166.671,333.331,726.672,000.001,691.672,000.001,656.672,000.001,621.672,000.001,551.672,000.001,516.672,000.001,481.672,000.00



SPPPPPPPPPPPPPPPP

10011110112011101120111011201110112011101120111011201110112011101120

Flow types describe the different changes to the cash flows. Together, all the flows for a transaction form the basis for generating the cash flow, and for further processing, such as posting. The cash flow contains all the flow records in chronological order and is used as a basis for updating the transaction data in Financial Accounting, Cash Management, and Market Risk Management. Typical flow types are fixed or variable interest, repayments, or commission.


© SAP AG AC816 8-7

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Changes to condition-based flows via the cash flow

Prerequisites:You have posted a disbursement (full or partial disbursement)

Conditions are changeable (if there is a saved disbursement,for example, conditions cannot be changed)

Changeable flows:Only condition-based flows

Only planned flows for the current fixed period

No capital reductions or increases

No final repayments (full repayment upon maturity)

Cash Flow: Manual Changes

In some cases, it is useful to be able to make changes to the planned records quickly and easily, especially for loans taken. For example, the lender uses a different procedure to calculate the loan payments, and you want to adjust your planned records accordingly.

Changeable data:

Due date

Payment date

Settlement date (for alternative settlement)

Amount

Payment data

- Partner

- Partner bank type

- Payment method

- Dunning area

- Dunning block

© SAP AG AC816 8-8

SAP AG 1999

Cash Flow: Making Changes

Contract --> Change --> Cash flow --> Select flow record --> Extras--> Change flow

Manual changes to flows in the cash flow

12/31/YY 12/31/YY 5,000.00 1120 L_Instalm. rep.

Due date Payment date Amount Flow type Text

Icon for change

Icon for fixing

You can change flows manually. If you want these changes to be considered when you recalculate the cash flow, you must fix the changes. If you fix the due date/payment date, a calendar icon appears. If you fix all the data for a flow, a lock icon appears.

© SAP AG AC816 8-9

SAP AG 1999

Calculate cash flowCalculate cash flow Basic view

Due date view

Calculation view

Posting view

View for manual changes

......

Loans - Cash Flow: Display Variants

Due on Settlement amnt Curr.Name PFTypL_Loan disbursem.L_Interest pay.L_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payableL_Interest payableL_Inst. rep. payable

100,000.001,166.671,333.331,726.672,000.001,691.675,000.001,656.672,000.001,621.672,000.001,551.672,000.001,516.672,000.001,481.672,000.00



SPPPPPPPPPPPPPPPP

10011110112011101120111011201110112011101120111011201110112011101120

The cash flow display is linked to the ABAP List Viewer. You can use the display variants to focus on different information. There is a predefined view for manual changes, for example.

The cash flow is regenerated on the basis of the fixed changes. Should the changes result in new annuity or instalment amounts, or a reduction in the term, these flows must be calculated separately to take effect.

© SAP AG AC816 8-10

SAP AG 1999

Exercise: Adjusting an Amount in the Cash Flow

© SAP AG AC816 8-11

SAP AG 1999

Business Operations for Contracts

What is a business operation (BO)?

An activity relating to a loan, which generates one orseveral flow records (for example, unscheduled repayment,charges)

These flow records are not posted using the automaticdebit position run. Instead, you must trigger the postingspecifically for this activity.

The "Business operation" function replaces the "Manual posting" function.

© SAP AG AC816 8-12

SAP AG 1999

Reversed

Deleted

Included in thecash flow as asimulated record

Saved in thedatabase asa planned record

Saved in thedatabase asan actual record

Status of business operation:

Activate (if release procedure is activated,release first)

DeleteChange

Delete

Reverse

Post

Entered/saved

Activated

Posted

Business Operations: Process

A business operation (BO) can pass through three statuses. It is first entered, then activated, and then posted. You can also enter a business operation and post it immediately.

Entered business operations are included as simulated records in the (simulated) cash flow calculation (as part of business operation processing). If you delete the business operation, you cannot trace the history.

Activated business operations contain fixed flows that can no longer be changed. These flows are saved to the database as planned records. If you delete an active business operation, you can still trace the history.

Posted business operations cannot be deleted. They have to be reversed.

If the release procedure is set to active, the business operation must be released between "entered" status and "activated" status. When you call up the function to activate a business operation, this triggers the release procedure, and the business operation appears for release in the Business Workplace inbox of the relevant employee. After the release, the business operation has activated status. Activated status is a prerequisite for further processing.

© SAP AG AC816 8-13

SAP AG 1999

Disbursement( )

Types of Business Operation

Enter Charges Individually

- Entry of one or several business operations- Each business operation consists of one flow record- You can activate, post or reverse each business operation

separately

Enter Charges as Business Operation Unscheduled Repayment

- Entry of one or several business operations- Each business operation can consist of several flow records- You can activate, post or reverse each business operation

separately; this affects all the flows for a business operation

You can use each of the above functions to enter one or several business operations. You use the functions Enter Charges as Business Operation and Unscheduled Repayment to enter more complex business operations, which can also involve derived flows (such as rate gains or accrual/deferral flows) or incidental costs. Since disbursement is also a type of business operation, you can call up the disbursement function under the Business Operations for Contract node of the menu. However, because disbursement is so complex, it is treated as an independent function in the system. Although you can call up the disbursement function under business operations, the system actually branches to the separate disbursement function, which is not subject to the same processing logic as business operations.

You post the flows generated by the business operation using the business operation function. Flows entered using the function Enter Charges Individually can also be posted using the Post Individual Records function.

© SAP AG AC816 8-14

SAP AG 1999

CoCdLoan

BO status Name First entered by First entered on

Entered Special charge Harry Smith MM/DD/YY Activated Posting charge Harry Smith MM/DD/YY

Flows for business operation

Activate Post Create Details

FTyp Amount Curr. Pmnt date Name Pmnt transact. PK6145 100 UNI MM/DD/YY Special charge x 21

100000060001

Entering Charges as a Business Operation:Example

6146 50 UNI MM/DD/YY Extra charge x 216147 10 UNI MM/DD/YY Proc. charge x 21

The overview for the contract contains all the business operations of a given type that have not yet been posted.

You define the flows the user is permitted to enter for each business operation in Customizing.

The system automatically enters the value "21" (manual debit position) in the Posting control field. The setting for the Payment transaction indicator depends on the Customizing settings.

© SAP AG AC816 8-15

SAP AG 1999

Business Operations: Customizing

1. Maintain the number range for business operations

2. Assign Flow Types to Cond. Group per Application

− Application 101: Unscheduled repayment

− Application 102: Enter charges as business operation

− Application 103: Enter charges individually

3. Business Operations

− Define company code-specific texts

− Define default values for flow types

− Define parameters(should an unscheduled repayment reduce the loan term orreduce the repayment instalment?)

Each business operation has its own number in the system.

For each condition group, you must assign the following for each application function:

The flow types permitted for each type of business operation

Whether the respective flow types should be posted to customer accounts (Payment transaction ID = "1").

SAP recommends that you assign the calculation category NOOP (no operation) to flow types posted by business operation functions. Exception: Flows for the business operation unscheduled repayment.

You can make the following settings for business operations:

For a given company code and application function, you can specify a text to be transferred with the postings.

For a given company code, product type and flow type, you can define default values for the payment method. These values appear as proposals when you enter this flow type in the application.

For the business operation Unscheduled Repayment, you can set a default value for the effect of the repayment on the loan term or payment instalment (the repayment reduces the loan term, reduces the payment instalment, or has no effect on the term/instalment payment). You make this setting for a given company code and product type. If the term is reduced, the system automatically adjusts the end of the term and, where necessary, the end of the fixed period. If the instalment is reduced, the system automatically inserts a new condition item with the new payment instalment and the next effective from date. The details for this condition item are based on the condition data (frequency, calculation date, ...) and the calculation date of the unscheduled repayment. If you reset an unscheduled repayment that has been activated or posted, you have to adjust the reduction in the instalment or term manually.

© SAP AG AC816 8-16

SAP AG 1999

Business operationEnter Charges Individually

Condition-based plannedrecords

(posting control: "manual debit position")

Post Individual Records

Initial screen: Company code, loan number, due date from ... to ...

xx

MM/10/YY 6145 120.00 UNI

Post

Posting Individual Records

MM/10/YY 6146 300.00 UNI

MM/30/YY 1110 2,530.50 UNI

Due on Flow type Amount Curr.

You can use the Post Individual Records function to post the following:

Flows entered (and activated) using the function Enter Charges Individually

Condition-based planned records set up for "manual posting" in the posting control section of the condition detail screen.

© SAP AG AC816 8-17

SAP AG 1999

Exercise: Special Charges

© SAP AG AC816 8-18

SAP AG 1999

Bal. sheet: Account 2

Bal. sheet: Account 1

Capital position 1

Capital position 2

Capital position n

Capital position x

Capital position 1

Capital position a

Capital position b

Capital position y

Balance sheetBalance sheettransfertransfer

Capital transfer: Capital transfer: Group contractsGroup contracts

Capital transfer: Capital transfer: Split contractSplit contract

Transfer Postings: Overview

You can use the Balance Sheet Transfer function to transfer loan positions for a contract from one G/L account in Financial Accounting to another. In this case, the transfer posting only affects the FI general ledger.

You use the Capital Transfer functions to transfer positions between contracts. This affects both the loans subledger and the FI general ledger.

When you group contracts, you usually transfer capital amounts from several source contracts to one target contract. When you split a contract, you usually transfer the capital from one source contract to several target contracts.

© SAP AG AC816 8-19

SAP AG 1999

Account assignment ref. X: Bal. sheet account 46000

Automaticdetermination

Change contract

Contractdata:yyy Account assignment ref. Y:

Bal. sheet account 46020

Automaticdetermination

Flagged for balance sheettransfer

Execute balance sheet transfer

4602046000

10,000BST 10,000 BST 10,000

Balance Sheet Transfer

Contractdata:xxx

The balance sheet account for posting the loan position is taken from the account assignment reference. This is determined automatically on the basis of the data entered for the loan and the rules in Customizing for automatic determination of the account assignment reference.

If you make changes in the contract that result in a different account assignment reference according to the Customizing settings, the following applies:

1. If the contract (disbursement) has not yet been posted:

- The account assignment reference in the contract is changed

2. If the contract has already been posted:

- The account assignment reference in the contract is changed

- The loan is flagged for balance sheet transfer, regardless of whether the balance sheet accounts for the two account assignment references differ.

You trigger the balance sheet transfer itself as a separate activity. The system calculates the balance of the old balance sheet account on the basis of the actual records, and posts it via an interim account to the new balance sheet account.

Indicator Delete transfer flag if acct assignment reference has not changed: If you set this indicator, the system deletes the transfer flag for contracts that are not actually affected from the database. This can be the case, for example, when loan data has been changed several times, and the combined effect of the changes results in the same account assignment reference (assuming that the existing transfer flags have not been posted).

© SAP AG AC816 8-20

SAP AG 1999

Target loan (or source loan) information

Control parameters Capital amountsTransfer dateFlow typeSource loan InclusiveTarget loan Inclusive

Company codeTarget (or source) loan...

Source loan(or target loan)

Transfer amount

Distribute cash receiptsDisc./prem. def. not to revenue

Capital Transfer: Grouping and Splitting Contracts

By selecting Source loan inclusive, or Target loan inclusive, you define whether the transfer date (key date) is still included in the interest calculation for the source loan, or counted towards the interest calculation for the target loan.

Prerequisites for capital transfers:

The source loan to be transferred has been disbursed (either fully or partially).

The outstanding principle for the source loan (available capital = remaining capital + unscheduled (and saved) inflows and outflows) must be at least as great as the amounts to be transferred.

The target loan has a disbursement obligation of at least the amount to be transferred.

All contracts have the same contract currency and the same product category.

There are no cash flow-relevant, non-condition-based postings after the transfer posting date; if such postings exist, you must reverse them manually beforehand (examples: posted partial disbursements, posted unscheduled repayments).

There are no balance sheet transfers after the key date.

Treatment of existing postings after the key date:

Posted debit positions: Automatically reversed, recalculated, and reposted.

Accrual/deferral postings: Automatically reversed, recalculated, and reposted.

Discount: Cleared automatically and distributed in proportion to capital, depending on the selection (indicator).

© SAP AG AC816 8-21

SAP AG 1999

Other posting

Capital transfer

Debit position

Disbursement

Reverse Individual Activity

Interest accrual/deferral

Reset

Discount deferral

Reverse Accrual/Deferral

Reversal

If you reverse a document in Loans Management, the system reverses the document in Financial Accounting automatically. As for "normal" postings, you should always trigger reversals from the Loans Management component; the system automatically transfers the information that is relevant for posting to Financial Accounting (FI).

You can reverse accrual/deferral postings and resets using the Reverse Accrual/Deferral function. If you have posted an accrual/deferral and a reset, you have to reverse the reset before you can reverse the accrual/deferral. If you want to reverse several discount deferrals, you must proceed in reverse chronological order.

© SAP AG AC816 8-22

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The system displays all items* for the activities chosen in the specified period(* reversible items with selection checkbox; items that cannot be reversed can onlybe displayed)

Select record to be reversed

Specify Treasury reversal reason

Post reversal

Reversal categories or groups:Disbursement / Debit position / Capital transfer / Other postings

Selection

Reversal posting: Update run or simulation

Reversing an Individual Activity

You can use the Reverse Individual Activity function to reverse all posted activities (ACTUAL records), as long as there are no subsequent postings in the cash flow. If such postings exist, you must reverse the related activities first.

Examples:

Reversal of an actual record (A1, interest debit position), which is followed by two other actual records (A2, A3 both interest debit positions). Before you can reverse A1, you have to reverse A3 and A2 in reverse chronological order.

Reversal of an actual record (A, interest debit position), which is followed by non-condition-based planned records (P) with a later date, such as a saved disbursement. Before you can reverse A, you must delete the planned record P.

© SAP AG AC816 8-23

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I. Define Treasury reversal reasons

RRe Long name PmntBlType

01 Processing error02 Other reason

Reversal: General Customizing Settings I

The Treasury-specific reversal reasons are used for information purposes for evaluations in the loans subledger. They are only relevant for reversing individual activities.

Payment blocks are only relevant for loans given (posted to customer accounts).

© SAP AG AC816 8-24

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II. Define flow types for reversing incoming/outgoing payments

1. Flow types 4596 (A_Reversal acct incoming pmnts) or 4597 (A_Reversal acct outgoing pmnts)

2. Define account determination(Automatic clearing to Reversal account or Reversal account to Automatic clearing)

3. Assign flow types to incoming payment processing category (14 or 15)

Reversal: General Customizing Settings II

As from Release 4.5, two separate flow types are required for reversing incoming payments and outgoing payments (see Customizing example above). This is necessary for technical reasons following changes to the reversal function.

© SAP AG AC816 8-25

SAP AG 1999

Assign activity category for reversal transaction grouping

PTyp Text Activity cat. Rev. group 1 Disbursement2 Debit position3 Incoming payments4 Capital transfer5 Other posting

F4

...0009 Disbursement: Credit...0027 Transfer: Credit...

F4



... ... ...

... ... ...

Reversal: Customizing Settings for IndividualActivities

By assigning the (flow type) activity categories to reversal groups (reversal categories), you determine which documents (for the corresponding posted flow type) are displayed in which group. A checkbox appears beside the reversible documents, with which you can select the documents for the reversal posting.

Reversal group 5 is used for other postings, such as write-offs or waivers for loans given posted to customer accounts.

You can also assign other activity categories, such as accruals/deferrals, to reversal groups, even though accruals/deferrals are not actually reversed using the Reverse Individual Activities function, but separately. The effect of assigning other activity categories to a reversal group here is that the corresponding documents (such as accruals/deferrals) are displayed when you choose Other postings in the application. They cannot, however, be selected (no selection checkbox). This can be helpful for information purposes. Exception: Documents from the contract currency changeover are never displayed by these reversal functions.

© SAP AG AC816 8-26

SAP AG 1999

Enter unscheduled and supplementary activitiesin the system

Examples:- Unscheduled repayment- Supplementary charge


Special Cases: Unit Summary

© SAP AG AC816 8-27

Special Cases Exercises

Unit: Special Cases


• Enter unscheduled / supplementary activities

The interest amount you have calculated differs from the amount calculated by the lender.

The lender charges a supplementary fee for the loan you have received.

1 According to the account statement from your bank, the interest to be paid is 0.04 UNI more than the amount calculated by the system. Adjust the amount in the cash flow.

2 You want to enter a special charge for your loan amounting to 100 UNI. Use the newly created flow type SXX (see unit "Loan Contract", exercise 4).

2-1 For the condition group "Loans taken", assign this flow type to the corresponding application function 103 "Enter charges individually".

2-2 Enter a special commission charge, activate it, and post it.

© SAP AG AC816 8-28

Special Cases Solutions

Unit: Special Cases


• Enter unscheduled / supplementary activities

1 Changing the cash flow

→ Accounting → Treasury → Loans → Transaction Management → General Loan → Contract

→ Change

Choose Calculate cash flow (pushbutton).

→ Extras → Change flows

2-1 Assigning a flow to an application (Customizing) → Loans → Transaction Management → Condition types → Define Condition Groups

Select condition group "504" (general loan taken).

→ Assign flow types to condition groups

© SAP AG AC816 8-29


Appl. func. 103

Flow type SXX

2-2 Entering a special charge → Accounting

→ Treasury → Loans → Position Management → Business Operations for Contract → Enter Charges Individually

© SAP AG AC816 9-1

SAP AG 1999

Changing a contract

Rollover - Individual rollover

Process management

Customizing:- Rollover- Process management

Contents:

Condition Changes

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SAP AG 1999

Process individual rollovers at the end of thecondition term

Use the process management functions forselecting contracts


Condition Changes: Unit Objectives

© SAP AG AC816 9-3

SAP AG 1999

Disbursement

Closing operations

Master data



Course overview


Process flowfor loans taken

Loan contract

Payments due

Special cases

Condition changes


© SAP AG AC816 9-4

SAP AG 1999

The fixed period for conditions has expired for aloan you have received, and you need to negotiatethe future conditions with the lender. You receiveseveral condition offers, and choose the mostsuitable one.

Condition Changes: Business Scenario

© SAP AG AC816 9-5

SAP AG 1999



- Accruals/deferrals- Valuation- Summarization- Information system- Special cases- Condition changes

Appli-Appli- OfferOffer ContractContract Disburse-Disburse- Other Other Rollovercationcation mentment datadata


© SAP AG AC816 9-6

SAP AG 1999

Time

MM/DD/YY MM/DD/YY+3

Contractconclusion

End of the first fixed conditionperiod

MM/DD/YY+15

End of loanterm

Contract

Conditions:

Fxd fr. MM/DD/YYFxd unt. MM/DD/YY+3

Offer/contract

Conditions:

Fxd fr. MM/DD/YY+3Fxd unt. MM/DD/YY+7

Rollover

Change contractor

Loans: Rollover

The fixed period agreed for loan conditions may be shorter than the loan period. At the end of the condition term, you need to negotiate new conditions with the lender and set down the period for which they are applicable. You process each contract individually, using either the Change Contract function or the Individual Rollover function.

If you create contracts for loans that are being rolled over, functions that lead to changes in capital amounts are blocked for these loans; you can no longer change conditions using the functions Change Contract, Disbursement, Business Operations for Contract, Waive Contract, Capital Transfer, or Reversal. If a loan is in a rollover file, and contracts have not yet been created, you can use the above functions if this is permitted by the Customizing settings.

© SAP AG AC816 9-7

SAP AG 1999

Loan disbursement posted

Change contract

User authorization

Loans: Changing Contracts

If a disbursement has been posted for a loan, only users with the appropriate authorization can make changes to the contract and conditions. (Exception: Non-financial condition data can be changed without special authorization. This includes payer/payee and posting data in the condition items, and application, contract and notice data in the condition header).

If you change conditions using the Change Contract function, no condition history is available apart from the change documents. The system only displays the current condition header. If you use the rollover function, you can trace the condition history.

© SAP AG AC816 9-8

SAP AG 1999

Rollover:Rollover:Adjustment of Adjustment of loan conditionsloan conditions

At the end of theAt the end of thecurrent current fixed periodfixed period

At anyAt anytimetime

Rollover: General

Using the rollover function, you can systematically roll over contracts for which the conditions have expired.

The rollover functions enable you to:

Adjust the loan conditions at the end of the current fixed period for several contracts (including organization and monitoring of the related business transactions): Loans given only

Adjust the conditions of an individual loan at any time: Loans given and loans taken

You roll over a loan by by recreating the condition header and reentering the fields to be changed in the condition items. You can then track the original values using the condition history. The remaining fields (contract master data) are not affected by the rollover and are copied over. At the same time, the system makes automatic changes, such as deleting conditions that have expired.

© SAP AG AC816 9-9

SAP AG 1999

Rollover: Key Terms

General file / Main file / File

Register

Functions

You select the loans to be rolled over by defining appropriate selection criteria. You can group the loans selected in different files for processing. (Example: File 1: Mortgage loans, File 2: General loans). A file in the system is comparable to a physical file. A file is subdivided into registers. (Example: File 1: Registers "Not started", "In process" and "Completed"). Various functions are available for each register: (Example: Register "Not started": Functions "Create offer", "Print offer"; Register "In process": Function "Print offer").

© SAP AG AC816 9-10

SAP AG 1999

What is the result of the rollover?What is the result of the rollover?

Contract:Conditions X

Which contracts are rolled over?Which contracts are rolled over?

FilesFiles

Main filesMain files

General filesGeneral files

or inor in

or inor inContractsContractsin specificin specific

Contract:Conditions Y

Rollover - Overview

The individual rollover function always applies to a contract you have specified. You roll over a contract that has been put into a file.

The individual rollover function generates contracts directly.

The contracts comprise the condition header and the corresponding condition items.

© SAP AG AC816 9-11

SAP AG 1999

2. Rollover --> Individual rollover

- Entries: Company code, contract- Button: Create contract- Entry: File- Entries: New conditions- Save

1. Create file structure

3. If necessary, remove loans from the file manually

Rollover: Process Flow

© SAP AG AC816 9-12

SAP AG 1999

General fileGeneral file

Main fileMain file

File File File File File

Loan: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

Rollover: File Structure

Main fileMain file

The above hierarchy allows you to organize your work more effectively.

The general file contains all the main files, and hence all the files in the system. The system generates this general file automatically as a "virtual" file. There is one general file for each company code - this file provides an overview of all the loans currently being rolled over.

A main file is subdivided into a series of files. The rollover file is a primary parameter for organizing rollover activities. Rollover files enable you to group loans and process them together. For example, you could create a file for each rollover officer.

You can control access to files and main files by defining an authorization group. You can control access to a general file via the display and change transactions linked to the user profile. When a file is filled, the system checks whether the display authorization required exists for each loan selected. Loans with excluded authorization groups are logged, but not put into the file.

A loan can only be in one rollover register/file/main file.

© SAP AG AC816 9-13

SAP AG 1999

Company codeMain fileVersion YYYYMM

Rollover: Creating a Main File

Company codeMain fileVersion YYYYMMVersion number

0001Rollover05YYYY05

Reference

When you create a main file, you must specify a version number (YYYYMM). The system also assigns an internal version number (sequential numbering for each explicit version, starting with 001). You can change a main file as long as it has not been filled.

SAP recommends that you only create one version of the main file per month and use the corresponding month and year for the name.

© SAP AG AC816 9-14

SAP AG 1999

No.Company codeMain file Version YYYYMM

Rollover: Creating a File

Loan distribution

Clerk pref.

Remainder distrib.

Equal Sequential Assigned

PSC

File listFile list

File Clerk Name AGrp SC

WILSON WILSON/KATEEU1

Insert file Edit selection

Rollover05 0001

YYYY05 001

You determine which loans are selected for the main file by defining the main selection criteria (typically, the Fixed until field of the condition header is used for the selection).

In the file list, you create the files required for systematic processing. Using the selection criteria (SC), you can define which loans from this main file should be put into each of the files. A range of functions are available for assigning loans to the individual files:

Name of the clerk specified in the file: Only for information purposes.

Name of the clerk specified in the file and the flag Clerk pref. is set: All loans that fulfil the selection criteria of the file (priority 3), or where the clerk specified is entered in the loan* (priority 2), or where both these conditions are fulfilled (priority 1) are assigned to this file.

Distribution of remaining loans (Remainder distrib.): The loans in a main file that cannot be assigned to a file on the basis of the selection criteria can be distributed to the files as follows:

- Sequential: The loans are assigned to the files successively (first loan to first file, second loan to second file, and so on)

- Equal: The remaining loans are distributed in such a way that the number of loans in each file is as equal as possible.

- Assigned: The remaining loans are put into a specific file.

* The clerks for the rollover must be created as business partners in the corresponding role (and entered in the loan).

© SAP AG AC816 9-15

SAP AG 1999

Exercise: Creating the File Structure

© SAP AG AC816 9-16

SAP AG 1999

FileFile

Main fileMain file


Individual rolloverIndividual rollover

EditDisplay

EditDisplay

EditDisplay

Edit

Loan

s gi

ven

Loan

s ta

ken

Rollover: Processing Options

You can roll over individual loans using the Individual Rollover function. This function is available for both loans given and loans taken.

For loans given, there is a mass processing function for rollovers. You access this function by selecting all the loans to be rolled over from a specific file, main file, or general file. You define how the user is allowed to access the mass processing function in Customizing.

© SAP AG AC816 9-17

SAP AG 1999

Company codeMain file Version YYYYMM No.

Rollover: Register Overview

Register overview

Rg Short name No. of loans Contract capital Planned capital

File information

269,827.72 222,527.75

: :1

:Contract created

:VE

:

Totals 369,827.72 322,527.75No. of loans 5

YYYY05 0010001Rollover05

In Customizing you define which registers the system should create for each file. Registers are subdivisions of the file. It is useful to create registers that classify the loans according to the processing status within the rollover transaction.

By selecting a register, you can display the overview of the loans in this register. You can then process the contents of the register.

In Customizing, you can define whether contracts that have been processed should be transferred to a specific register or removed from the rollover process.

If a loan has been rolled over using the Individual Rollover function and no further processing is required, the loan can be deleted from the register.

© SAP AG AC816 9-18

SAP AG 1999

Main file

Register

No. of loans

N

P R

Contract no.

100001237

101085536

X

X

Rollover05UB 5

Rollover: Selecting the Processing Functions

File/register information

N

Dialog individual rolloverDisplay contractCreate rollover offersPrint rollover offersDelete rollover offers...

Function overviewSelect Edit Function

11NNN

Loans overview

To process the loan(s) in this register, select the loan and choose Functions. The Select Edit Function dialog box appears. In Customizing you define the editing functions available in each register.

All the selected loans are processed by the function you have chosen. If you choose the Individual Rollover function, the condition header overview appears.

The rollover function generates new condition headers of the following type: Individual rollover: Legally-binding contract; signed by both parties

© SAP AG AC816 9-19

SAP AG 1999

Exercise: Rolling Over a Contract

© SAP AG AC816 9-20

SAP AG 1999

EvaluationEvaluation

Rollover: Evaluations

Rollover statistics

File contents

The rollover statistics provide information about the position to be rolled over within a specific period. This evaluation is independent of the rollover file structure, in other words, all loans are considered irrespective of whether they are in a rollover file. You run the report for a single company code. The main selection criterion is the interval for the end of the fixed period. The default setting is that all capital amounts are calculated at the end of the respective fixed period. Alternatively, you specify a calculation date. The system displays the total statistics for each product type/loan type.

When you analyze the file contents, the system displays the following information for all company codes for the selected loans (general files, main files, files, registers):

Capital fields and number per register

If you selected an individual list according to loan number or file structure: List of all the loans in the selected file structure.

© SAP AG AC816 9-21

SAP AG 1999

Activity type

Logical fields

Registers

Report functions

Transaction functions

Loans_

_

_ Functions

Rollover

Customizing: Rollover

You make the Customizing settings for the rollover functions in the IMG under Functions -> Rollover.

© SAP AG AC816 9-22

SAP AG 1999

Loans_

_

_ Functions

Rollover_ Define

Activity Type

Customizing: Defining the Activity Type

AT

P

Name

Rollover

Use activity type "P" for rollover.

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SAP AG 1999

Details101020

Selection field

Properties

Set/get program

Program

SAPFF67P

"Double-click"

FldNo.

101010

101020

:

Name

Product category

Product type

:

Field number

Define Logical Fields

Modification

Customizing: Defining Logical Fields

Various components of the rollover function use selection criteria to select the relevant loans. The fields available as selection criteria are defined in Customizing. You can define additional logical fields by means of a read and write routine (set/get routine). You can define all the fields from R/3 standard tables (such as partner data, basic loan data, or loan conditions) or external files as logical fields.

They are used as selection criteria for:

Choosing the loans to be rolled over on a certain date (main file)

Distributing the loans to the files

Assigning new conditions (variants)

© SAP AG AC816 9-24

SAP AG 1999

Register

Name Rollover offers created

RegisterTypTarget reg. ID Removal ID

Properties

"Double-click"

RG

AD

AE

:

Name

Rollover offers printed

Rollover offers created

:

AE

Define Register

Dunning reg. Term end reg.

Changes permitted

Dunning tol. Term end tol.

Customizing: Defining Registers

In Customizing you define the registers for each file. You enter details for each register, for example, whether a register can be a target register. Loans can be transferred to a target register automatically after the processing functions have been executed.

If you set the Removal ID flag, you can remove a contract from the register without processing it.

If you set the Dunning register indicator, the system moves all the contracts for which the reservation period has expired into this register.

You can specify a lead time in the Dunning tolerance field.

If you specify a register as a Term end register, the system moves all the contracts for which the fixed interest period has expired to this register.

You can specify a lead time in the Term end tolerance field.

The Changes permitted indicator controls whether changes that affect the loan capital are allowed for loans in this register (for which no offer/contract has been created).

© SAP AG AC816 9-25

SAP AG 1999

Function code

Function call RFVDPF01

Detail screen

PAES

FCd

PADR

PAES

:

Name

Print rollover offers

Create rollover offers

:

Exec. param. ID

Refer. date ID B

Define Report Functions

AETrgtRegister

Customizing: Processing Functions I

The loan processing functions can either be report functions or transaction functions.

In the case of report functions, you process tasks using a report program, which allows you to follow the activities. In the case of transaction functions, you process tasks as part of an interactive transaction.

You have a range of options when you execute a report in the application, and the system generates a processing log.

There is a detail screen behind each entry in the Customizing table. In the detail screen you can make default settings, for example, execution parameters (online, batch) or print parameters (log).

© SAP AG AC816 9-26

SAP AG 1999

Function code

Function call

Init. program

FNP0

"Double-click"

MPAE

FCd

MPAE

Name

Dialog individual rollover

SAPFF67F INIT.FNP0Init. form

Define Transaction Functions

Customizing: Processing Functions II

Transaction functions start a transaction. The system contains three transaction functions: Individual Rollover, Display Contract, and Loan Overview.

In the detail screen, you define the function call, the initialization form routine and the program for this routine.

© SAP AG AC816 9-27

SAP AG 1999

Process management

FileFile FileFile FileFile FileFile

Configure/fill filesConfigure/fill files

Main fileMain file Main fileMain file


Process Management: Overview

The Process management function is based on the same functions as rollover.

It also builds on the file concept and is used, for example, to generate correspondence in a mass processing run.

A loan in the rollover file can also be assigned to one file of another activity type at the same time (for example, a process management file).

© SAP AG AC816 9-28

SAP AG 1999

Settings for process management:

Process management

Correspondence

- Word processing

- External flow types

Process Management: Customizing

The Customizing settings for process management in the IMG (Functions -> Process Management) correspond to those for the rollover function. You maintain them in the same way. For process management, you define an activity type, such as "K" for correspondence.

Process management also uses word processing settings and external flow types. You make these settings in the IMG under Correspondence.

© SAP AG AC816 9-29

SAP AG 1999

Customizing for number ranges:

For rollovers: For process management:

Condition number

Rollover number

Condition number

Rollover / Process Management: Number Ranges

© SAP AG AC816 9-30

SAP AG 1999


Process individual rollovers at the end of the conditionterm

Use the process management functions for selectingcontracts

Condition Changes: Unit Summary

© SAP AG AC816 9-31

Condition Changes Exercises

Unit: Condition Changes


• Roll over contracts

You arrange a rollover with the lender.

1 Configure the files for the loan rollover.

1-1 Create a main file in your company code.

Choose the product category (330) as the main selection criterion. 1-2 Create file 1 in this main file. Assign “Rollover processing staff”.

2 Roll over a loan taken using the Individual Rollover function. After the rollover,

remove the loan from the file.

© SAP AG AC816 9-32

Condition Changes Solutions

Unit: Condition Changes


• Roll over contracts

1 Create file structure

1-1 Create a main file: → Accounting

→ Treasury → Loans → Position Management → Process management → Configure Files

→ Create


Activity type P

Company code TRXX

Main file FromDXX

Version YYYYMM

To enter the main selection criterion, use the change button for the PSC field.


Product category 330

→ Copy

© SAP AG AC816 9-33

1-2 Create a file in the File list section.


File 1

Loan processor 9000000002

→ Save

2 Roll over contract → Accounting → Treasury → Loans → Position Management → Rollover → Individual Rollover

Create a contract directly with the rollover function.

Remove loan from file

→ Accounting → Treasury → Loans → Position Management → Rollover → File Processing → File → Edit

Select the loan you have rolled over and choose Register content.

→ Edit → Remove loan

© SAP AG AC816 10-1

SAP AG 1999

Master data:- Business partners- Objects- Collateral

Application / offer / contract

Release

Customizing

Contents:

Master Data

© SAP AG AC816 10-2

SAP AG 1999

Use the functions for managing contract data inthe system before the contract is actuallyconcluded (application, offer)

Use the functions for managing additional datarelating to the loan


Master Data: Unit Objectives

© SAP AG AC816 10-3

SAP AG 1999

Disbursement

Closing operationsContract currencychangeover


Course overview


loans taken

Loan contract

Payments due

Special cases

Condition changes

Master data


© SAP AG AC816 10-4

SAP AG 1999

As well as managing actual contracts in thesystem, you also want to map the process leadingup to contract conclusion. You want to include allthe available data that is relevant to the loan, suchas collateral.

Master Data: Business Scenario

© SAP AG AC816 10-5

SAP AG 1999

Integration with R/3 FI /TR Cash Management

Master dataMaster data

Business partners Collateral Object master data

Transaction mgmtTransaction mgmt

Application Offer Contract


Position mgmtPosition mgmt





The transactions in the Loans Management module are integrated with the R/3 Financial Accounting component and with TR Cash Management.

A range of programs allow you to carry out evaluations according to different criteria.

© SAP AG AC816 10-6

SAP AG 1999



ContractContractContract offerContract offerApplicationApplication ContractContract







© SAP AG AC816 10-7

SAP AG 1999


- Create loan- Business partners- Conditions- Disburse/post loan- Integration with CM- Integration with FI- Determine amounts due- Outgoing payments

- Accruals/deferrals- Valuation- Summarization- Information system- Special cases- Condition changes- Master data

Appli- Offer Contract Disburse-Disburse- OtherOther RolloverRollovercation mentment datadata


© SAP AG AC816 10-8

SAP AG 1999

Partners Objects

Loans

Collateral

Master Data - Overview

In the R/3 System, all real estate collateral in the form of land and buildings is included under Objects. Collateral covers all other collateral except for land and buildings (objects).

© SAP AG AC816 10-9

SAP AG 1999

May be acustomer in

FI

When loan

is created

Part 1: Real estate registerPart 2: Subsidiary rightsPart 3: 3 sections:

Section I) OwnershipSection II) ChargesSection III) Rights

Collateral:

• Stocks• :

Lender Partner

= Prerequisite for creating encumbrances

(charges on property)

Data is automaticallytransferred to the landregister, Part 3 / Section III

Master Data: Interrelationships

Loan Objectwith basic data

Land register:

Please note that the functions for the land register are primarily designed to meet German requirements and may not be relevant to your country.

© SAP AG AC816 10-10

SAP AG 1999

Partners

Loan

Master Data: Partners

Collateral

Partners Objects

In the R/3 System, all real estate collateral in the form of land and buildings is included under Objects. Collateral covers all other collateral except for land and buildings (objects).

© SAP AG AC816 10-11

SAP AG 1999

Create Contract: Initial ScreenCreate Contract: Initial ScreenCreate Contract: Initial Screen


0001/internal/33A



E N T E R

You enter your business partner as the lender. You can use a business partner that has already been defined in the system, or create a new one.

© SAP AG AC816 10-12

SAP AG 1999

Create / change / displayCreate / change / display

Create / change / display inroleCreate / change / display inrole in conjunction with loan

Loans Management

TR-TM: Basic Functions

PartnerPartner

Business Partner

In business partner management, you can create, change and display general business partner data.

You can enter a loan partner in the system in three ways:

1. Create the business partner by choosing Basic Functions ->Business Partner in the application menu: In this case, you create the partner using a grouping, without assigning an application area. You can then assign loan-specific roles and data to the partner later on.

2. Within the Loans Management component - Business partner -> Create in Role: In this case, you first specify the application area (mortgage loan or general loan) and then enter the partner role (for example, "A102 Main lender") on the next screen. If role types have been defined for a role category, these are displayed; if not, the role category is displayed.

3. Within the Loans Management component - Create business partner in role when creating a loan: In this case, you select the partner role (role type or category) when you enter a loan. If an FI customer account is required for loans in that particular status (for example, "contract"), the system creates an FI customer automatically on the basis of the default values defined in Customizing. If no FI customer is required for this loan status, the system only creates an FI customer using the default values if you call up a customer view.

© SAP AG AC816 10-13

SAP AG 1999

Master Data: Objects

Partners

Loan

Collateral

Partners Objects

Objects can be assigned to loans that belong to the product category Mortgage loan for which the flag Objects active is set in the product type definition.

© SAP AG AC816 10-14

SAP AG 1999

Master data

- Create- Change

Create/change loan

Objects Master data- Create- Change- Assign

Master data- Create- Change- Assign


Master Data - Procedure

Collateral

File

Master data for objects (as well as collateral and files) can be created separately to a loan. You can access existing master data from a loan (application, offer, contract). This master data can be assigned to one or more loans.

Alternatively, you can create master data from within a loan. This master data is then assigned to the appropriate loan automatically.

© SAP AG AC816 10-15

SAP AG 1999

YesYesYes NoNoNo

Address available?

Create object data

Create object

Master data Loan

Create addressCreate address

Creating an Object

© SAP AG AC816 10-16

SAP AG 1999

Land register

Main objectMain objectAdditionalAdditional

objectobject

LoanLoan

Land register

Objects - Loan

You can assign one or more objects to a loan. If there are several objects, you must define one of them as the main object (object classes: Main object, additional object, joint liability object).

If an encumbrance (charge over property) exists for the objects, you can maintain the encumbrance data as soon as the object is linked to a loan.

© SAP AG AC816 10-17

SAP AG 1999

Basic dataBasic data Additional dataAdditional data Parts of buildingParts of building Land register dataLand register data

Basic dataLand register (name)Valuation bases...

Real estate registerSection ISection IISection III

Objects - Data


Maintenance of the land register name is optional; you only need this name if encumbrance rights are to be documented in the object data.

If you want to create correspondence to the land registry, you have to maintain the land registry as a business partner with the appropriate role category. If this is not required for the correspondence, it is sufficient to simply specify the land registry names in the object.

You can keep an "online land register" for information purposes.

© SAP AG AC816 10-18

SAP AG 1999

Land registryLndRegist. from

No. De Prcl Parcels RPRNo Business type For PropOld LocSubDist. Area

.

.

333 40 172,175 7466 Office building Frankfurt 325

Objects - Real Estate Register

Land Registry FrankfurtFrankfurt


Some of the data from the land register details is used in the collateral value calculation (for example, the area specification is used to determine the land value).

© SAP AG AC816 10-19

SAP AG 1999

Land registryLndRegist. from

No. De List of properties Rank Type ofAmount Currency charge

Objects - Section III

Land Registry FrankfurtFrankfurt

1 1250,000.00 UNI 2 Land chargeIDES

2 2100,000.00 UNI 1 MortgageMortgage Bank, Frankfurt


Section III is used to enter encumbrances.

You can maintain and change third-party rights at any time in the land register data.

You enter own encumbrances when the object is assigned to a loan. The data you enter here is transferred automatically to the fields in Section III of the land register data, where it cannot be changed. To make changes, you must change the data in the loan.

© SAP AG AC816 10-20

SAP AG 1999

Loan~~~~~~~~~~~~~~~~~~~~~~~~~~~

ObjectObject

Section IIIEncumb. 8819

Assigned to

Encumbrances Object data

Land register data

Automatically entered in

Encumbrances (Charges on Property)

© SAP AG AC816 10-21

SAP AG 1999

Loan: Object - Encumbrance

Create F4

Overview of encumbrances

Collateral typeCollateral type

Objects

Object no.1000000001

Object type

Name1000 - Encumbrance1001 - Assigned encumbrance

Company code 0001 30B Mortgage loan ContractLoan 10000000

After you have entered the land register name, you can create encumbrances.

The encumbrances can be divided into collateral types that you define in Customizing (for example, original rights, assigned rights).

© SAP AG AC816 10-22

SAP AG 1999

V 250,000.00 UNI

Overview of encumbrances / details

Collateral type EncumbranceType of charge Mortgage Vol./cert.

Amount

Right acc.to land reg.

Creating Encumbrances

Object number 1000000000Land registry Frankfurt

When you create an encumbrance, you enter the type of charge (mortgage, land charge), the mortgage type (ordinary mortgage, claim-securing mortgage), and the amount.

© SAP AG AC816 10-23

SAP AG 1999

Object Object datadata

-

-

Loans

Master Data

Collateral Object

Define Object TypesDefine Land RegisterTypes

-

- Basic Data

+

+

+

Additional Data

Parts of Building

Collateral Value (Long Version)

F4

Customizing: Objects

In the IMG under Collateral Object you define default values for some of the object data fields.

© SAP AG AC816 10-24

SAP AG 1999

Master Data: Collateral

Partners

Loan

Collateral

Partners Objects

Collateral objects can be assigned to loans for which the flag Collateral objects active is set in the product type definition.

© SAP AG AC816 10-25

SAP AG 1999

Master data

- Create- Change

Create/change loan

Objects Master data- Create- Change- Assign



Master Data - Procedure

File

Collateral

Master data for objects (as well as collateral and files) can be created separately to a loan. You can access existing master data from a loan (application, offer, contract). This master data can be assigned to one or more loans.

Alternatively, you can create master data from within a loan. This master data is then assigned to the appropriate loan automatically.

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SAP AG 1999

Other dataContracts

Guarantees

Pledgedsecurities

Other credit balances

Collateral

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Collateral: DataCollateral: Data SecuritiesGuarantees

.....

Data for collateral item

- Amount- Currency- Security ID number- ...

Assignment data

- Date for collateral contract (assignment from)- Amount of assigned portion- ...

Collateral - Data

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SAP AG 1999

Collateral type Total value Assigned value

Col.50006000

Fixed-int. sec.Stock

NumberTotal/Value

Collateral

Company codeLoan number

?

Assignm. date

Short name

?

' -> Create '

Creating Collateral

Mortgage loan Contract

0001 30B10000000

When you create data for a collateral item, you first define which type of collateral is relevant, for example, whether you want to enter data for a security or a guarantee. The system then branches to the corresponding entry screen as defined in Customizing.

© SAP AG AC816 10-29

SAP AG 1999

Exercise: Collateral

© SAP AG AC816 10-30

SAP AG 1999

Loans

Master Data

Collateral

Define Collateral Types

Define Guarantee Types I Define Guarantee Types II

Define Special Treatment Define Pledge Status Define Special Arrangements

-

-

Definition ofcollateral types

Special typesof guarantee

-F4

Customizing: Collateral

© SAP AG AC816 10-31

SAP AG 1999

Col. Short name Name Cat.

1000 Encumbrance Encumbrance 1 1001 Assigned encumbr. Assigned encumbrance 112000 Endow. policy Endowment policy 22001 Term life ins. Term life insurance 2

Col. Short name

EncumbranceAssigned encumbr.

10001001

F4 "Encumbrance" F4 "Collateral"Col. Short name

Endow. policyTerm life ins.

20002001

Customizing: Collateral Types

In Customizing, you define the names of the collateral types to be used in the application. By assigning a corresponding collateral category, you determine the relevant entry screens.

Collateral types with collateral category 1 (encumbrance, own rights in section III) or 11 (assigned encumbrances) can only be used in the application with an object for entering encumbrances. Collateral types with other collateral categories are only available with the other collateral objects. An exception to this is collateral category 50 (main collateral). A collateral type with this collateral category can be kept in the loan basic data for information.

© SAP AG AC816 10-32

SAP AG 1999


- Create loan- Business partners- Conditions- Correspondence- Disburse/post loan- Integration with CM- Integration with FI- Determine amounts due- Outgoing payments

- Accruals/deferrals- Valuation- Summarization- Information system- Special cases- Condition changes- Master data

Appli- Offer Contract Disburse-Disburse- OtherOther RolloverRollovercation mentment datadata


© SAP AG AC816 10-33

SAP AG 1999

Contract

Transfer to offerTransfer to offer

ChangeChange WaiveWaive ReactivateReactivateDisplayDisplayCreateCreate

Application


Transfer toTransfer tocontractcontract

Contract offer


Application/Offer/Contract - Function Overview

The stage in the process leading up to conclusion of a loan contract is represented by the loan status. The three main statuses are application, offer, and contract.

You can transfer data from an application to an offer or a contract. If an offer has been entered, you can transfer the data to a contract.

You define the statuses through which a loan can proceed (status transfers) in Customizing.

The entry screens for applications, offers, and contracts are basically the same. You are free to decide which data you enter in each status.

In the application, you usually enter the information required by the lender to make a loan decision (such as collateral and objects available to secure the loan).

At the offer stage, you usually enter the conditions you have been offered by the lender.

Any missing data should be added at the contract stage.

© SAP AG AC816 10-34

SAP AG 1999

TransferTransferto contractto contract

TransferTransferto offerto offer

Appli-Appli-cationcation

CreateCreateChangeChangeDisplayDisplay

WaiveWaiveReactivateReactivate

Full waiver

Application: Function Overview

If a customer makes a loan application and then withdraws it, you can deactivate the data you have entered by waiving the application. Once you have waived the application, you can no longer process the application data. It can, however, still be displayed.

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Creating a Loan: Initial Screen

Reference data

Sample loan no.Partner

Sample loan

0001/internal/30B

The screens for entering applications, offers, and contracts all have the same basic layout. In Customizing, you can use the field selection function to control which fields are mandatory or available in each status.

There are three alternative ways of creating a loan (application, offer, contract):

1 Fill all the master data fields manually.

2 Transfer the data from a sample loan. You can create a sample loan using the Sample loan function. The data is entered in the same way as for a "standard" loan, but without a business partner. If you want to use a sample loan to create a new loan, enter the corresponding data in the Reference data section.

3 Copy the data from a "standard" contract created previously. Choose Copy from... . A dialog box appears prompting you to specify the contract from which you want to copy the data.

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SAP AG 1999

Create Application: Initial ScreenCreate Application: Initial ScreenCreate Application: Initial Screen


0001/internal/30B



E N T E R

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Correspon-dence

All the functions discussed so far for contracts are also available forprocessing applications.

However, you usually only enter conditions when you receive offers fromthe lender.

In the application, you collect all the data you have given the lender as abasis for deciding whether to grant you the loan, including data oncollateral and collateral objects.

Application - Basic Data

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Contract Contract offeroffer

ChangeChange

CreateCreate DisplayDisplay

Contract acceptanceContract acceptance Offer waiverOffer waiver

ReactivateReactivate

Partial waiver

Full waiver

Offer: Function Overview

You can create offers directly, or transfer data from an existing application.

If you reject an offer, this is entered in the system as a full waiver. If you accept an offer, but require less capital, you can enter the reduction in the loan amount as a partial waiver. If you accept the offer as it is, you can transfer the data to a contract using the Contract Acceptance function.

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SAP AG 1999

Transfer to offerTransfer to offer

Create one or several "offers"(offer variants)

Appli-cation

No. 10000001 No. 10000001 No. 10000001

Contract

Offer Variants

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Correspon-dence

All the functions discussed so far for contracts are also available forprocessing offers.

You usually enter conditions when you receive offers from the lender.

Offer - Basic Data

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Basic loan dataBasic loan data

Condition header

Cash flowCash flow

Condition items

Planned records

------------------------------------------------------

Condition Structure

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SAP AG 1999

Further processingfully or partially

rejected

Contractoffer

Full waiver

Contractoffer

Partial waiver

Contractoffer

10,000 UNI

Waiving a Contract Offer

© SAP AG AC816 10-43

SAP AG 1999

Non-accept. reasonRejec./waiver on

Company codeLoan

0001 Mortgage loan30B

General02 Competitor's conditions better11 Incorrect entry in offer

Prev. statusNew status

Contract offerContract offer completed

2034

The loan is inactive - display only

Full Waiver

Status

A full waiver deactivates the offer, in other words, you cannot process it further. You can, however, display the data.

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SAP AG 1999

Company codeLoan numberBorrower . .

0001 Mortgage loanContract offer

30A20

Contract capitalValue-dated capitalDisbursement obligationNew disbursement oblig.

150,000.000.00

150,000.00140,000.00

UNI

Start of term

Calc. date 04/15/YY 10,000.00Amount

In the loan: Condition item "Capital reduction" is added automatically

Partial waivers

Contract data

Partial Waiver

If you decide not to accept the full loan amount offered, you can waive part of the capital in the system in two ways:

1. You can reduce the commitment capital in the loan in the condition header. Disadvantage: The history is not immediately visible.

2. Use the Partial Waiver function. The commitment capital for the loan remains unchanged; the system automatically adds a new condition item for the capital reduction. The cash flow, and all other calculations, are based on the reduced capital amount.

© SAP AG AC816 10-45

SAP AG 1999

ContractContractContract

One contract offer (variant)One contract offer (variant)One contract offer (variant)

CreateCreate ChangeChange DisplayDisplay WaiveWaive

TransferTransfer

CreateCreate ChangeChange DisplayDisplay WaiveWaive ReactivateReactivate

Contract Offer/Contract - Function Overview

© SAP AG AC816 10-46

SAP AG 1999

APPLICATION LEVEL

Product cat.Product cat. Flow categoryFlow category Calculation cat.Calculation cat.


SYSTEM LEVEL




Flow typeFlow type


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SAP AG 1999

Entry 1 of 9

CS DGr1

Status name Int. level DGr.1


3120 23331 13234 23437 33760 335

FI CGAFSXXXXXX4 X

Company Code-Dependent Settings for Product Type: Status per Product Type

Customizing: Status Definitions

Contract offer waivedContract waivedContract

Contract offerApplic. waived/deactivated

Application

Field selection

0001 30B

1

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SAP AG 1999

Entry 1 of 9

Company Code-Dependent Settings for Product Type:Status Transfers per Product Type

Customizing: Status Transfers


0001 30B

PrevStat Status name0

Status name New stat.Application1

0 Contract offer200 Contract601 Application11 Contract offer201 Application - full waiver3120 Contract offer2020 Offer - full waiver3420 Contract60

ApplicationApplicationApplicationContract offerContract offerContract offer

Transfer matrix for external statuses

Copy stat. trans. Position...

For each company code, you define the permitted status transfers for each product type. This controls the processing steps permitted / required in loan processing.

The screen illustrated above shows all the possible status transfers. This setting is not relevant in practice and should be adjusted during system implementation to reflect the organizational process flows in your company.

© SAP AG AC816 10-49

SAP AG 1999

Data Further processing

- Loans master data- Business partners- Objects- Business operations- Capital transfers- Reversal- Disbursement

Release

Loans: Release

The report program for release has been replaced by the release workflow.

The system allows you to use a staggered release procedure for most functions in master data and flow processing. The release procedure is based on a principle of multiple control by at least two persons.

Release objects:

1 Flow data: Business operations*, capital transfers, reversals, disbursements *(3 release objects: Enter Charges Individually, Enter Charges as Business Operation, Unscheduled Repayment)

2 Central master data: Loan master data, business partners, objects

Generic workflow functions:

Definition of maximum times for work items: Pickup, processing, throughput time

Creation of attachments

Forwarding

Resubmission

User-specific adjustments to the workflow, for example:

Throughput times

User control settings for assigning work items to certain users (agents). Users can be assigned on the basis of the release object, company code, release level, or product type. For more information, refer to the documentation in the SAP Library (BC - Basis -> SAP Business Workflow).

© SAP AG AC816 10-50

SAP AG 1999

SAP MenuSAP Menu Office Office WorkplaceWorkplace

Workplace: User ABCWorkplace: User ABC Inbox Inbox Unread documentsUnread documents 55 Workflow Workflow 22

Inbox

Classif. Title Creation date

Release: Disbursem.of loan 1000007 ... MM/DD/YYYYRelease: New business table: Mortgage ... MM/DD/YYYY....

Release: SAP Business Workplace

When you create or change a release object, the system creates a new work item, thus initiating the release procedure. The work item appears automatically in the Business Workplace Inbox of the employee authorized to release it for further processing. The release procedure only has to be triggered manually for decision-making.

You can display the work items to be released using the ABAP List Viewer.

For each work item, you can:

Display the release history (date and time the object was created or changed; details of the user that created, changed, released the object; release status).

Display the release object

Change the release object; the object then has to be released again.

Release the release object

Reject the release object; it appears as a work item in the inbox of the person who started the workflow.

© SAP AG AC816 10-51

SAP AG 1999

Release object Long name Cat. Created byBUSOP Disbursement of loan 1000007 ... F User 123...

Report for displaying an overview of the release workflow− Selection according to release object for the current date− Display with the ABAP List Viewer− Display of the corresponding loans and company codes for each

object, as well as the release status and processing status of thework item

Overview of Work Items for Loans

You can monitor the position of a work item in the processing chain using a report in the information system (Transaction Release: Work Items for Loans).

© SAP AG AC816 10-52

SAP AG 1999

Workflow log

Task Result Date Time

Release: Disbursement of loan 1000007 MM/DD/YYYY 07.15.....

- Loan master data, objects, partners: Data is released

- Disbursement, business operations: System generates planned records and writes them to the database,

making posting possible

- Capital transfer, reversal: Data is posted immediately (actual records)

Result of Complete Release

© SAP AG AC816 10-53

SAP AG 1999

- Loans

Basic Settings

Transaction Management -

- Release

Active IndicatorsRelease Status ParametersAdjust/Copy Workflow Template

Rel. Obj. CoCd Cont.stat. PType Curr.ReSt. Act.

BPAR 01 11 VDARL 0001 30A 11

Rel. Obj. Name ActiveAUSZ Loan disbursem.

+

Customizing: Release

In order to use the release function, you have to activate the relevant release objects, specify the release status parameters for each object, and adjust the workflow template.

© SAP AG AC816 10-54

SAP AG 1999

Rel. object Name Short text Active

BPAR Business partner Partner

AUSZ Disbursement of loan contract Disbursement x

Release: Object

You have to define the release objects for which the release procedure should be active in Loans Management.

If the release procedure is active for master data objects (loan master data, data for the assigned business partner, collateral object), this data has to be released before you can carry out postings or change the loan status. If the release procedure is active for flow data objects (business operations, capital transfers, reversals, incoming payment postprocessing, disbursements), you cannot create a new flow record for this loan until you release the first one. You must release the master data for a loan before you can release flow data.

© SAP AG AC816 10-55

SAP AG 1999

NameL ReStEEEEEEEEEEEEEEE

01011202122303132334041424344

No releaseReleasedEntered, one release levelReleased, 2 employees

First release, 2 employeesEntered, 2 employeesReleased, 3 employeesSecond release, 3 employeesFirst release, 3 employeesEntered, 3 employeesReleased, 4 employeesThird release, 4 employeesSecond release, 4 employeesFirst release, 4 employeesEntered, 4 employees

Release: Names

The release status provides you with information about the current status of a transaction to be released.

The first character corresponds to the number of people required to release the object. The second character indicates the number of releases outstanding.

If both figures are identical, the (first) release can be carried out by the user that created or changed the object that is to be released. If both figures are different, the object can only be released by another user.

The release statuses are fixed in the system.

© SAP AG AC816 10-56

SAP AG 1999

Rel. object CoCd Status Limit amnt Curr. ReSt Active

AUSZ

AUSZ

TR00

TR00

30B

33B

11 X

100.000 FRF 32 X

Prod. type

Release: Parameters

In addition to activating the release object, you must specify the objects to be released and assign release status parameters before you can use the release procedure. You can activate the release status as a general release obligation for all transactions, or make it dependent on the company code and other parameters, such as the status, product type, or currency.

Entries in the above example: In company code TR00, all disbursement postings for mortgage loans (product type 30B) have to be released once; disbursements for general loans (product type 33B) paid in the contract currency FRF have to be activated three times (de facto twice) if the posting amount is equal to or exceeds 100,000 FRF. No release is required for other transaction postings.

In cases where several entries apply, the highest release status is relevant.

© SAP AG AC816 10-57

SAP AG 1999

Company code

Cross-company code

Contract number

Name of main borrower

Selection via contract number

With open itemsWith other contracts

Portfolio: Loans for the Partner

You can use the Loans for the Partner function to select and process loans by loan partner or by contract.

If you select the loans by contract, the system branches to the contract data display. From there - depending on the authorizations assigned - you can branch to the functions Change Contract, Disbursement, Unscheduled Repayment, Enter Charges as Business Operation, and Enter Charges Individually.

If you select the loans by partner, the system first determines all partners that are linked to the specified partner by the relationship type "alias". The system then finds all the contracts to which these partners are assigned as main borrowers, and displays the partners and contracts in a list. By selecting a specific contract number, you can branch to functions for processing the contract.

© SAP AG AC816 10-58

SAP AG 1999

EvaluationEvaluation

Information System: Portfolio - Evaluations

Loans: General Overview

Total Commitment per Partner

Loan Commitment

The Loans: General Overview function displays the most important data for a loan contract. You can display open items for specific contracts. The following data is evaluated: Contract data, capital amounts, dunning data, bank details, payment data, and contract conditions.

The Total Commitment per Partner report contains details of the commitment capital, the value-dated capital and the remaining capital for individual loans for each business partner. You can call up the total commitment report from within a loan by choosing Extras -> Total commitment (key date: "today"). Alternatively, you can call up the report from the Information System menu, where you can enter a range of selection criteria (any key date possible). In this case, you can choose whether to only evaluate the posted flows, or include the planned records as well. You can also specify whether only loans with contract status should be considered, or loans with both contract and offer status.

To calculate the Loan Commitment, the system accesses the data for the selected loans for all business partners.

© SAP AG AC816 10-59

SAP AG 1999

Exercise: Information System

© SAP AG AC816 10-60

SAP AG 1999

Number ranges for:

Loan number

Collateral object

Collateral

Business operation

Rollover number

.................

Loans: Customizing for Number Ranges

The various types of data maintained in Loans Management are usually stored under separate numbers in the system. You have to create number ranges for each one.

For some objects, you need to make specific entries:

A certain number range

Numeric or alphanumeric

Internal or external number assignment

For more information on the exact requirements, refer to the IMG documentation.

© SAP AG AC816 10-61

SAP AG 1999

Basic dataBasic data

Assignment / internal reference / characteristics

Alternative 1 / alternative 2

Reference

CON SWIFT confirmation files OPT Option reference for derivatives REF General reference SWP Foreign exchange swap

Transaction 1 Transaction 1

Additional fields

Other references

User fields

Group keys

References

In order to keep a record of transactions that belong together, you can define corresponding transaction links:

You can enter your own values for additional fields, other references, group keys and user keys as part of the basic data screen for a loan. This data is used for information purposes. You can evaluate the data in the additional fields, reference fields and group key fields using the drilldown reporting functions. (Note: You define the user fields in Customizing).

A "reference" between Treasury transactions documents a relationship between "n" objects, in other words, transactions (money market, foreign exchange, derivatives, securities) and contracts (loans). You create this object link with a reference category that controls how a reference is processed. Some references are created automatically, such as relationships between transactions that are part of one contract (forex swap). Other references are created explicitly by the user, such as the category "general reference". You can call up information about existing references from within a loan contract (or transaction) by choosing Environment -> Object links.

© SAP AG AC816 10-62

SAP AG 1999


Use the functions for managing contract data inthe system before the contract is actuallyconcluded (application, offer)

Use the functions for managing additional datarelating to the loan

Special Cases: Unit Summary

© SAP AG AC816 10-63

Master Data Exercises

Unit: Master Data


• Create master data

You want to assign a collateral item to a loan you have taken out.

In addition, you want to gain an overview of the capital amounts for this loan.

1 Enter 1000 stocks with the ID number 514000 as collateral for the loan you have taken out.

1-1 Create the collateral item: the current stock price is 80 EUR. The assigned value is 40,000 EUR.

1-2 Assign the collateral item to the loan you have taken out with the Deutsche Bank.

2 Call up an overview of the current loan position for this loan.

© SAP AG AC816 10-64

Master Data Solutions

Unit: Master Data


• Create master data

1 Creating Collateral

1-1 Create collateral

→ Accounting → Treasury → Loans → Master data → Collateral → Create

1-2 Assign collateral to loan → Accounting

→ Treasury → Loans → Transaction Management → Loan → Change

2 Position overview

→ Accounting → Treasury → Loans → Information System → Position/Position Trend

→ Loans: General Overview

© SAP AG AC816 11-1

SAP AG 1999

General information

Preparation activities

Conversion phase

Cleanup activities

Customizing

Contents:

Contract Currency Changeover

© SAP AG AC816 11-2

SAP AG 1999

Convert loan contracts to the euro

Make the necessary Customizing settings for thechangeover to the euro


Contract Currency Changeover: Unit Objectives

© SAP AG AC816 11-3

SAP AG 1999

Disbursement

Closing operations


Course overview


loans taken

Loan contract

Payments due

Special cases

Condition changes

Master data

Contract currency changeover


© SAP AG AC816 11-4

SAP AG 1999

We have arranged with the lender to change ourloans over to the euro.

Contract Currency Changeover: Business Scenario

© SAP AG AC816 11-5

SAP AG 1999

This section will give you an overview of:

Changeover options

Possible changeover scenarios

The local currency changeover for the loans area

The procedure for the contract currency changeover

Contract Currency Changeover:General Information

© SAP AG AC816 11-6

SAP AG 1999

At the end of the dual-currency phase, all the loans must have been converted to the euro.

Dual currency phase (01/01/1999 - 12/31/2001)

Loan contract

1,000,000 UNI

Contract currency:Currency participating in EMU


Loan contract

50,000 EUR

Contract currency:EUR

Changeover Options I

During the dual-currency phase, an agreement is made between the lender and the borrower to change over loan contracts that are in a currency participating in the EMU to the euro.

© SAP AG AC816 11-7

SAP AG 1999

Changeover Options II

You can change over the contract currency (CCC)before or after the local currency changeover (LCC).

The system supports the following changeover functions:

Individual processing Mass processing

- Loans given - Loans given- Loans taken - Loans taken

To reset the contract currency changeover, you always usethe individual processing function.

The functions for the contract currency changeover are the same for individual processing and mass processing. The data is always changed over in an update run. You cannot carry out a test run.

© SAP AG AC816 11-8

SAP AG 1999

Local currencyEMU currency EUR Other currency

Local currency(LC)

Case 1:CC = LC EUR

Example:UNI EURwhere LC = UNI

EMUForeign currency(FC)

Case 2:CC = FC EUR

Example:FRF EURwhere LC = UNI

Case 3:CC = FC EUR

Example:UNI EURwhere LC = EUR

Case 4:CC = FC EUR

Example:UNI EURwhere LC = GBPC

ontr

act c

urre

ncy

(CC)

Other foreigncurrency (FC)

Case 1: Standard case before the local currency changeoverCase 3: Standard case after the fall local currency changeover

In the interim period, local currency loansare managed as foreign currency loans

Possible Changeover Scenarios

Case 1:

Standard case: Loan in local currency; contract currency changeover (CCC) before the local currency changeover (LCC).

Case 2:

Loan in a currency participating in the European Monetary Union (foreign currency); CCC before the LCC. You need to value foreign currency loans before you change over the contract currency.

Case 3:

Standard case: Loan in a currency participating in European Monetary Union (foreign currency), originally a local currency loan, CCC after LCC.

Additional case: Loan in a currency participating in European Monetary Union (foreign currency), originally a foreign currency loan, CCC after the LCC. You need to value foreign currency loans before you change over the contract currency.

Case 4:

Only applies to customers outside the European Monetary Union that have loans in a participating currency.

© SAP AG AC816 11-9

SAP AG 1999

Dual currency phase

1/1/1999 1/1/2000 1/1/2001

1/5/1999 3/15/2001

LC = CC LC ≠ CC LC = CC

CC = FC

UNI

EUR

EUR

UNI

LC

CC

UNI

6/30/2002

LC and CC = UNI before 01/01/1999LC changeover on 03/15/2001CC changeover on 01/05/1999

Case 1: CCC of LC Loans before LCC

Before the contract currency changeover (01/05/1999) from UNI to EUR, the loans are managed as local currency loans.

In the period between the contract currency changeover and the local currency changeover (01/05/1999 to 03/15/2001), the converted loans (as well as new euro loans) are managed as foreign currency loans.

After the local currency changeover (03/15/2001), the loans are managed as local currency loans again.

© SAP AG AC816 11-10

SAP AG 1999

Dual-currency phase

1/1/1999 1/1/2000 1/1/2001

10/12/1999 3/15/2001

LC ≠ CC LC = CC

CC = FC

UNI

EUR

EUR

FRFFRF

LC

CC

6/30/1998

LC ≠ CCLC = UNI / CC = FRF before 01/01/1999LC changeover on 03/15/2001CC changeover on 10/12/1999

Case 2: CCC of FC Loans before LCC

Before the contract currency changeover (10/12/1999) from UNI to EUR, the loans are managed as foreign currency loans.

In the period between the contract currency changeover and the local currency changeover (10/12/1999 to 03/15/2001), the loans are still managed as foreign currency loans.

After the local currency changeover (03/15/2001), all the euro loans are managed as local currency loans.

© SAP AG AC816 11-11

SAP AG 1999

LC and CC = UNI before 01/01/1999LC changeover on 04/18/1999CC changeover on 02/15/2001

Dual-currency phase

1/1/1999 1/1/2000 1/1/2001 6/30/2002

4/18/1999 2/15/2001

LC = CC LC ≠ CC LC = CC

CC = FC

UNI

EUR

EUR

UNI UNI

LC

CC

Case 3 (Standard): CCC of LC Loans after LCC

Before the local currency changeover (04/18/1999) from UNI to EUR, the loans are managed as local currency loans.

In the period between the local currency changeover and the contract currency changeover (04/18/1999 to 02/15/2001), the loans which were originally local currency loans are managed as foreign currency loans.

After the contract currency changeover (02/15/2001), the original local currency loans are changed back to local currency loans.

© SAP AG AC816 11-12

SAP AG 1999

Dual-currency phase

1/1/1999 1/1/2000 1/1/2001

4/18/1999 11/18/2000

LC ≠ CC LC = CC

CC = FC

UNI

EUR

EUR

FRFFRF

LC

CC

6/30/2002

LC ≠ CCLC = UNI / CC = FRF before 01/01/1999LC changeover on 04/18/1999CC changeover on 11/18/2000

Case 3 (Additional Case): CCC of FC Loans afterLCC

Before the local currency changeover (04/18/1999) from UNI to EUR, the loans are managed as foreign currency loans.

In the period between the local currency changeover and the contract currency changeover (04/18/1999 to 11/18/2000), the loans are still managed as foreign currency loans.

After the contract currency changeover (11/18/2000), the loans which were originally foreign currency loans are managed as local currency loans. This only applies for foreign currencies participating in EMU.

© SAP AG AC816 11-13

SAP AG 1999

Conversion of a loan from a participating currency to the euro:Automatic conversion of all currency fields that are based on thecontract currency and used for calculations in financial mathematics(FIMA) and posting (currency amounts, currency keys, exchange rates):

Master data:

Loan master data (contract data)Condition headers and condition itemsPayment splitting dataPayment advice data

Flow data:

Documents in the subledger / cash flow:Actual recordsNon-condition-based planned recordsCondition-based planned records (visible after planned record update)

Drawings on disbursement

CCC: Converting the Data

Contract currency: In the background, the system creates a new field for the original contract currency (this is used for the parallel currency display in correspondence).

Conditions: You must convert reference interest rates manually as part of the cleanup.

You must process the following data manually:

Collateral

Objects

Encumbrances

Collateral value calculations

Credit standing calculations

...

Documents:

Documents in the loans subledger are converted.

FI documents are not converted; the FI document contains the amount originally posted.

© SAP AG AC816 11-14

SAP AG 1999

Preparationactivities:

Accounting

Disclosecurrency reserves:

TR-TM-SE

- File management- Cancel summarizat.

TR-LO

Effects on FI:TR-LO

Convert limits

Execute

Run currencyvaluationprogram

- Process files- Summarization program

ReconcileFI and TR-LO

Make settings

Startchangeover

Preparationactivities

CustomizingSettings:TR-TM-SE

Convertmanually

Conversion oflocal currency

yes

yes

yes

yes

yes

yes

no

no

no

no

no

no

Effects on FI:TR-TM-SE

yes

no

ReconcileFI and TR-TM-SE

Local Currency Changeover and Loans I

When you execute the local currency changeover, you must ensure that there are no loans in rollover files. You must process the files beforehand.

For all loans whose contract currency is not euro and for which summarized records have been created, you must either invalidate or delete the summarization before the local currency changeover.

The local currency amounts in FI and TR-LO are converted independently of each other. Since the local currency amounts are converted at different summarization levels (document in TR-LO / account transaction figures in FI), there may be differences when you compare TR-LO and FI that result from rounding differences during the local currency changeover.

You must reconcile the TR-LO and FI balances both b e f o r e and a f t e r the local currency changeover to check the consistency of the data.

For more information, see the Treasury euro documentation.

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Adjustselection criteria:

TR-LOProcess

Local currencyconversion

Currency hedge

Cleanupactivities

Limit managementreport program

SEUVTBLV

Adjust data in CM Execute

End of changeover

no

no

yes

yes

Effects on FI:TR-TM-SE Process

yes

Effects on FI:TR-LO Process

no

yes

Local Currency Changeover and Loans II

You have already assigned the relevant selection criteria to all files and methods. After the local currency changeover (and after the contract currency changeover) you need to check the selection criteria and make any necessary changes. You do this using the corresponding functions in the Loans application menu.

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Startchangeover

CCC: Accounts Make settingsin Customizing

Value FC loans

Empty rolloverfile

Conversion of contract currency

Convert master data

Convertflow data

Loansrolled over

Adjustmentflows

Currency swap:Loan position

Generalpreparation

activities

Preparationactivitiesper loan

End ofchangeover

Cleanup activities


Currency swap:Disc./premium

Conversionlog

Balance sheettransfer Other activities

Processsuspended data

Contract Currency Changeover (CCC): ProcessFlow

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This section will give you an overview of:

The general preparation activities:

- Prepare accounts for CCC postings- Value foreign currency loans- Make settings in Customizing

The preparation activities per loan contract:

- Process suspended data- Empty the rollover files

Contract Currency Changeover:Preparation Activities

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CCC: Accounts

Make settingsin Customizing

Value FC loans

Processsuspended

data

Emptyrollover

files

Generalpreparation

activities



Start ofchangeover

Preparation Activities: Overview

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ICCC: Accounts

IIIMake settingsin Customizing

IIValue

FC loans

Generalpreparation

activities

General Preparation Activities

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Currency swap postings for:

Balance sheet accountAccruals/deferrals (premium/discount)

Adjustment postings (for rounding differences):

Adjustments to capital amountsRemaining capitalDisbursement commitmentInterest calculation capital

Any necessary balance adjustments for outgoing paymentprocessing in the subledger

Contract Currency Changeover: Postings

When you convert the contract currency, the system makesthe following postings:

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Activities:

1) Make sure that you can make postings to each balance sheetaccount in FI in both euros and the original currency.

(This is always the case if the currency of the balance sheet accountis the local currency. You can use the validation function in FI torestrict the postings to certain currencies.)

2) Set up clearing accounts in FI for the CCC postings, such as:

- a clearing account for currency swap postings- a clearing account for the adjustments to capital amounts- a clearing account for the balance adjustments

I: Contract Currency Changeover: Accounts

Application menu: Financial Accounting / General Ledger / Master Records / Individual Processing

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PREREQUISITES

You must carry out a foreigncurrency valuation:

--> Before the contract currencychangeover for loans originallymanaged in a foreign currency thatis participating in EMU

PROCEDURE

Application level:

Loans ⇒Accounting ⇒Closing Operations ⇒Valuation of Foreign CurrencyLoans

II: Processing Foreign Currency Loans

If you do not value foreign currency loans before you change over the contract currency, problems arise when you carry on processing the loan. Before the start of the dual currency phase, you must therefore perform a (one-time) foreign currency valuation for all loans in currencies participating in EMU (that differ from the local currency).

You must value all the relevant foreign currency loans using a one-step valuation principle that calculates the full valuation gain or loss.

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Define currencies to beconverted and the euro

Treasury Management ⇒Basic Functions ⇒Euro Currencies ⇒Define Participating Currencies for Euro Changeover

Define currency code forthe euro

General Settings ⇒Currencies

III: Customizing: Currencies

In the Loans area (TR-LO), you can only change over the contract currency for currencies defined as participating currencies in the Customizing step Define Participating Currencies for Euro Changeover.

You can only convert the contract currency to the currency that is defined as the target currency in Customizing. When it converts the contract currency, the system also checks whether the currency of the loan to be converted is defined in the translation table in Customizing and whether a fixed rate exists for the currency pair "currency to be converted - target currency".

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Flow type Name Flow Calculation Activity category category ID

1910 Incr. disbursem.commitm. euro EUA+ NOOP 08 1915 Red. disbursem.commitm. euro EUA- NOOP 07 1920 Incr. remaining capital euro EUR+ NOOP 08 1925 Red. remaining capital euro EUR- NOOP 07 1930 Incr. int. calc. capital euro EUZ+ AA 08 1935 Red. int. calc. capital euro EUZ- SS 07 1940 Currency swap pos. inflow 2UBZ NOOP 08 1945 Currency swap pos. outflow 2UBA NOOP 07 1950 Currency swap disc. outflow - - 07 1951 Currency swap prem. outflow - - 08 1952 Currency swap disc. inflow - - 08 1953 Currency swap prem. inflow - - 07 ....

Example: Extract from the table of flow types

III: Define Flow Types for Adjustment Flows andCurrency Swap Postings

Flow types for currency swap postings and adjustments to capital amounts: See above; Flow types for adjustments to balances: See the standard Customizing settings delivered with the system and Note 124254.

To maintain flow types in Customizing, choose Treasury Management / Loans / Transaction Management / Flow Types / Define Flow Types.

For the currency swap of the balance sheet position, you must define flows with the flow categories 2UBA and 2UBZ. During conversion, the system changes these flow categories to EUUB. (You need to make the settings in this way to enable the system to determine the flow types automatically. The flow categories are replaced to prevent the flows from being considered for evaluations.)

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Treasury ⇒

Treasury Management ⇒

Loans ⇒

Transaction Management ⇒

Condition Types ⇒

Define Condition Groups

Assign flow types to the application functions:

III: Currency Swap Postings for Loan Positions andAdjustments to Capital Amounts

For the contract currency changeover, assign the flow types 1910-1945 to application function 850. For the reset, assign the flow types 1945 and 1940 to application function 851. Application function 850: Contract currency changeover to the euro Application function 851: Reset contract currency changeover to the euro

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Make the following settings for currency swap postings foraccruals/deferrals (discount/premium):

For each (original) flow type that generates a discount or premiumposting, define two flow types for the currency swap posting.

Assign the currency swap flow types to the original flow types asoffsetting flows.

The same applies for balance adjustments.

III: Currency Swap Postings for Accruals/Deferrals

For currency swap postings for accrual/deferral (discount/premium): See the standard Customizing settings delivered with the system and Note 111785.

For adjustments to balances: See the standard Customizing settings delivered with the system and Note 124254.

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Treasury ⇒

Treasury Management ⇒

Loans ⇒

Functions ⇒

Accounting ⇒

General Ledger Update ⇒

Define Account Determination

III: Account Determination for Flow Types

To ensure that the changeover to the euro is posted correctly, you must define account determination for all the additional flows.

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You can generate correspondence with a dualcurrency display. In this case, the amounts areshown in both the original currency or local currencyand in euros.

To make use of this option, you must change theCustomizing settings for correspondenceaccordingly.

III: Correspondence

The following applies for loans given:

The Customizing settings delivered with the system contain a sample document AUSZ.ANZSCH_DUAL (Disbursement notification: Dual currency) as an example of a disbursement letter with a parallel currency display.

The function module EMUL_ALTERNATE_CURR_FOR_SCRIPT is used for currency translation in correspondence.

If you want to use the parallel currency display in correspondence, you must change your settings in Customizing for correspondence to match the above sample document.

The remaining capital at the time of the CCC is saved in the field VDARL_EU-BREMAINCAP. You can use this value in the correspondence if you want to disclose the remaining capital in the original currency to the borrower when you convert the contract currency.

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IProcess

suspendeddata

IIEmptyrollover

file


Preparation Activities per Loan

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PROCEDURE

Before you convert a loan using theindividual processing function,release any suspended data.

I: Process Suspended Data

Data is suspended when the release function is set to active and master data or flow records relating to a loan are in release status.

If suspended data still exists when you run the conversion, the system automatically writes an error message to the conversion log, indicating that the loan in question was not converted.

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PREREQUISITES

There are loans in the rollover file.

These loans cannot be changedover to the euro.

PROCEDURE

Loans ⇒

Portfolio ⇒

Rollover ⇒

File Processing ⇒

General File ⇒

Display / Edit

II: Empty Rollover File

When you perform the contract currency changeover, you must ensure that none of the loans to be converted are in a rollover file. If this is the case, you must process the rollover, or remove the loan from rollover processing.

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This section gives you an overview of the conversionprocess:

Conversion procedureConversion of master dataConversion of flow dataLoans rolled overGenerating and posting adjustment flowsCurrency swap postings for the loan positionCurrency swap postings for the discount/premiumBalance adjustmentsReset procedure

Contract Currency Changeover:Conversion Phase

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Contract currency conversion

Convertmaster data

Convertflow data

Loansrolled over

Adjustmentflows

Curr. swap:Loan position

Curr. swap:Disc./prem.

Contract Currency Changeover: ConversionProcedure

SAP recommends that you change over your loans successively, rather than changing them all over at the end of the dual currency phase.

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ProcedureLoans ⇒

Portfolio ⇒

Contract Currency Changeoverto the Euro ⇒

Currency Changeover

Selection criteria

Control parameters for online conversion

Control parameters for conversionusing process management

Company codeLoan number

Posting date

Planned record updatex

Put loan into file

CCC: Start Conversion for Individual Loans

During the dual currency phase, we distinguish between individual loan processing and mass loan processing. Call up the individual processing function as shown above. You use the process management function for mass loan processing. When you call up the individual changeover function, you can put a loan into a file and process it later using the mass processing function.

The system performs a contract currency changeover according to the settings you have made in Customizing (IMG step: Define Participating Currencies for Euro Changeover).

Cash Management is updated automatically when you run a planned record update. You can choose whether to have the planned records updated automatically when the contract currency is converted. If you run the conversion program without the automatic planned record update, the system updates the Cash Management records when you carry out the next planned record update.

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Exercise: Convert Contract Currency

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The following master data is converted automatically:(currency key, amounts in contract currency)

Loan master data

Condition headers

Condition items

Payment splitting data

Payment advice data

If the account assignment reference has been definedas currency-dependent, the system sets a flag for thebalance sheet transfer when the currency is changed tothe euro.

Conversion of Master Data

The system determines the account assignment reference automatically on the basis of the settings in Customizing:

Treasury / Treasury Management / Loans/ Functions / Accounting / General Ledger Update / Control Automatic Determination of Account Assignment Ref.

As part of the cleanup process you must carry out the balance sheet transfer flagged during the conversion run.

SAP recommends that you set up the system so that it does not use the currency as a basis for determining the account assignment reference automatically. Otherwise, you may experience performance problems when changing over the contract currency.

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The following flow data is converted:(Examples: currency keys, amounts in contract currency, exchange rates)

Document items / cash flow:

All actual records

Planned records not based on conditions are translated

Planned records based on conditions are deleted in the originalcurrency and regenerated using the conditions that have beenconverted to euros (they are visible in the cash flow when youcarry out a planned record update)

Drawings on disbursements

Conversion of Flow Data

The system converts a loan as at a specified key date, taking into account any translation or rounding differences. The contract number stays the same. Note: Amounts in local currency are not converted during the contract currency changeover.

During the conversion run, condition-based planned records are converted to the euro. After the planned record update, you can see the newly-calculated amounts in the cash flow. This planned record update can be triggered in two ways:

When you run the contract currency changeover by setting the Planned record update indicator when you run the conversion program

or

After the contract currency changeover by calling up the planned record update function (choose Portfolio / Periodic Processing / Update Planned Records) You need to do this at the latest before the next debit position run!

This applies for individual processing and mass processing.

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If loans have been rolled over, the system adjuststhe commitment capital in euros.

Loans Rolled Over

The commitment capital for the rollover is calculated on the basis of the cash flow for the existing commitment capital and other amounts.

After the contract currency changeover, the system calculates the commitment capital (for the last rollover) in the same way as it was calculated originally, but this time on the basis of the cash flow in euros. As a result, there are no rounding differences.

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UNI / EUR exchange rate: 1.95583

UNI EUR

Disbursement 100,000.00 51,129.19 Repayment 50,000.00 - 25,564.59- Remaining capital (calculated from flows) 50,000.00 25,564.60 Remaining capital (translated directly) 50,000.00 25,564.59 Rounding difference 0.01 -

Capital amount field

Contract Currency Changeover: Example

CCC: Example of differences for capital amounts:

The system makes the following calculations:

The capital amounts are calculated on the basis of the cash flow in the original currency: Remaining capital (from flows): 50,000 UNI

The capital amounts in the original currency are translated directly into euros using the fixed rate: Remaining capital (direct translation): 25,564.59 EUR

The cash flow is translated from the original currency into euros record by record.

The capital amounts are calculated on the basis of the cash flow in euros: Remaining capital (from flows): 25,564.60 EUR

Calculation of the rounding difference: 0.01 EUR

Relevant capital amount: Remaining capital translated into euros (directly): 25,564.59 EUR

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Remaining capital50,000.00 UNI (before conversion on the basis of the cash flow for the loan)

25,564.60 EUR (after conversion on the basis of the cash flow in Loans, without adjustments)

25,564.59 EUR (calculated by translating the original amount at the fixed exchange rate)

Rate EUR/UNI1.95583

There is a difference of 0.01 EUR, in other words, the remaining capital after conversion is toohigh by 0.01 EUR. This difference is taken off the books.

Balance sheet account Clearing account for currency swap

50,000.00 UNI 50,000.00 UNI 25,564.60 EUR 50,000.00 UNI

0.01 EUR 25,564.60 EUR

25,564.59 EUR Starting basis: Position in UNI

Currency swap outflow

Clearing account for capital adjustment Currency swap inflow (LC balance = 0)

0.01 EUR Adjustment posting for remaining capital

Position in EUR after conversion (balance view!)

Currency Swap Posting: Loan Position

Prerequisite:

For currency swap postings (for loan positions, open items and discounts/premiums) you must be able to make postings to the clearing account for the currency swap (and other relevant accounts) in both euros and the original currency.

Procedure:

The system performs a currency swap posting for the proportional loan balance in the balance sheet account in FI:

The system determines the remaining capital in the original currency via the cash flow and posts this amount from the balance sheet account to a clearing account for currency swap postings.

The system determines the remaining capital in euros on the basis of the euro cash flow, and posts this value back to the balance sheet account.

Note: Since you cannot post a local currency amount of zero in FI, the adjustment comprises two postings for technical reasons. In the first posting, the position is posted to a clearing account. In the second posting, the local currency amount is taken off the clearing account, since only the contract currency needs to be adjusted. Example: Aim: Post 0.01 EUR = 0.00 UNI (LC). Postings: 1) 0.01 EUR = 0.02 UNI (clearing account to balance sheet account); 2) 0.00 EUR.= 0.02 UNI (balance sheet account to clearing account).

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When capital amounts are converted (interest calculation capital,disbursement commitment, remaining capital), the system adjusts for anyrounding differences

Adjustment amounts resulting from adjustment postings for the interestcalculation capital and disbursement commitment are only posted inthe loans subledger, and not in FI. You must set up account determinationfor the relevant flow types (1910, 1915, 1930, 1935):

Clearing acct for cap. adjustm. to Clearing acct for cap. adjustm.

Adjustment amounts resulting from adjustment postings for the remainingcapital are posted in FI. Account determination for flow types 1925 and19205:

Balance sheet account to clearing account andClearing account to balance sheet account

Generating and Posting Adjustment Flows

When the system converts and adjusts the capital amounts, it takes all the actual records that exist when you run the conversion into account (if there is a disbursement commitment, planned disbursements are also considered). The remaining capital is adjusted to reflect business practice, while the interest calculation capital and disbursement commitment are adjusted for technical reasons.

Rounding differences can affect the interest calculation. To clear the rounding differences, the system performs a one-off adjustment of the interest calculation capital on the conversion key date.

If the loan was fully disbursed before conversion, the system generates an adjustment flow (where necessary). This adjustment flow clears any rounding differences and sets the balance for the disbursement obligation back to zero.

The system also adjusts the remaining capital amount disclosed to the borrower. Any differences arising from the conversion are adjusted automatically and the corresponding postings transferred to FI.

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The proportionate premium/discount on the FIaccount is translated from the original currency intoeuros by means of a currency swap posting

The system determines the remaining premium/discount on thebasis of the cash flow in the original currency and posts this amountfrom the accrual/deferral account to a currency swap account(outflow).

At the same time, it calculates the remaining premium/discount onthe basis of the cash flow in euros and posts this amount from thecurrency swap account back to the accrual/deferral account (inflow).

Currency Swap Posting: Premium/Discount

During the conversion run, currency swap postings are only generated automatically for flow types with flow category "TA" and calculation category "TA". These flows must be flagged as relevant for accrual/deferral. Flow types with accrual/deferral method "0: None or manual" are not considered.

No adjustment flow is necessary.

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Currency swap postings are made using a currencyswap account. For each posting, the balance in localcurrency is zero.

Balance sheet account for loan positionThe proportionate position is taken off the FI balance sheetaccount in the original currency and posted back in euros.Where necessary, a capital adjustment is made for the remainingcapital.

Accrual/deferral accountsThe portion of the discount/premium that has not yet beenwritten back is taken off the accrual/deferral account inoriginal currency and posted back in euros.

Currency Swap Postings

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Adjustments for rounding differences:

Adjustments to capital amounts

Remaining capital (planned capital / effective capital)Disbursement commitmentInterest calculation capital

Balance adjustmentsfor outgoing payment processing in the subledger

Account-based balance adjustments

Adjustments Made During Conversion

Account-based balance adjustments cannot be attributed to a single item. They are carried out for loans that are managed on the basis of customer accounts as well as for those that are not.

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Reasons:Without balance adjustments, you cannot reconcile the loanssubledger and the FI general ledgerUnadjusted balances may result in processing errors if you reverseflows posted before the changeoverThe balance disclosed in the account statement is incorrect

Solution:The system generates balance adjustment flows during the contractcurrency conversionAccount-based balance adjustments(only for balance display in account statement)

Balance Adjustments I

Reconciliation: Balance adjustments can only occur if more than one flow is used to clear the original flow*.

Account-based balance adjustments are determined automatically and are only posted in the subledger.

* In the case of loans taken, the amount generated as the due item is usually the same as the (single) outgoing payment amount. In certain situations, balance adjustments may be necessary, for example when an amount is posted as due and two outgoing payments are generated using the manual posting function. Example: 20 UNI posted as due; after conversion (exchange rate: 1.90): 10.53 EUR: Interest paid to Payables 10.53 EUR. Two partial payments: 1) 10 UNI and 2) 10 UNI; after conversion: 5.26 EUR each. 1) Payables to Bank clearing 5.26 EUR; 2) Payables to Bank clearing. Comparison of amount due and outgoing payments: Amount due: 10.53 EUR Outgoing payments: 10.52 EUR (5.26 + 5.26) --> Account-based balance adjustment amounting to 0.01 EUR for the Payables account.

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Exercise: Changes Resulting from the CCC

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ProcedureLoans ⇒

Portfolio ⇒

Contract Currency Changeoverto the Euro ⇒

Reset Currency Changeover

Selection criteria

Control parameters

Reset euro contract currency changeover

Company code

Loan number

Posting date

Reason for reversal

Planned record update

Reset Euro Contract Currency ChangeoverReset Euro Contract Currency Changeover

Resetting the Contract Currency Changeover

The reset function reverses the contract currency changeover.

During the changeover, all the relevant loan data is saved to backup tables. If the changeover is reset, the system uses the data from these backup tables.

You can only reset the changeover if no postings have been made since the changeover. If postings have been made, you must reverse them first.

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1. Before you reset the changeover, you mustreverse any postings made since the changeover.

2. When the changeover is reset, the system revertsto the original data.

3. Any postings made since the changeover andreversed before the reset are translatedautomatically. If necessary, enter the postingsagain during the cleanup.

The reset function is only intended for reversing thecontract currency changeover.

Reset Changeover: Procedure

1 You must reverse any postings made after the contract currency changeover.

2 The reset function uses the original data from the backup tables, except for payment splitting data and payment advice data. You may need to postprocess this data manually, in which case there will be a corresponding note in the changeover log.

3 The system automatically converts the flows that were reversed for the reset and the corresponding reversal flows back into the original currency. Any flows in euros that you reverse before the reset must be posted again in the original currency after the reset.

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This section will give you an overview of how to:

Check the conversion log

Postprocess the balance sheet transfer

Perform other cleanup activities

Contract Currency Changeover:Cleanup Activities

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Conversionlog

Balancesheet

transfer

End ofchangeover

Cleanup activities

Otheractivities

Cleanup Activities

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During the conversion run the system automaticallygenerates a log.

The log appears when conversion of the individual loanis complete.

You can still view the log later on using transactionSLG1 and object FTLE.

Check Conversion Log

If errors occur during the conversion run, the loan is not converted.

The following information is recorded in the conversion log:

If the contract currency was converted:

- Whether a flag was set for the balance sheet transfer

- Whether reference interest rates need to be processed manually

Whether an error has occurred:

In this case, the loan has not been converted and is highlighted in red in the log.

If you select an item in the list and choose Display message, the system displays a list of the steps in the conversion procedure. If an error occurred during conversion, the corresponding place in the list is highlighted in red.

If you select an item in this detail list and choose Long text, the system displays more detailed documentation.

If you choose Back or Exit, you can call the log up again using the above transaction.

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Conversion:

- The system generates a flag for the balance sheet transfer- The flag is displayed in the conversion log

Cleanup: Trigger balance sheet transfer:

Procedure:

In the Loans application menu, choose ⇒ Balance SheetTransfer and enter your values in the initial screen.

If you have set up the system to determine the account assignmentreference automatically on the basis of the currency, the contract currencychangeover to the euro may result in a change to the account assignmentreference.

Cleanup: Balance Sheet Transfer

After you have run the conversion program, you must trigger the balance sheet transfer that was flagged. You can trigger the transfers individually or as a batch job.

The balance sheet transfer has the following effect:

For loans that have not yet been posted:

- The system changes the account assignment reference in the contract data.

For loans that have been posted:

- The system changes the account assignment reference in the contract data.

- The system carries out a transfer posting between the corresponding balance sheet accounts in FI.

If currency swap postings were made for the loan position during conversion, the posting date for the flagged balance sheet transfer must be after the conversion date.

See also: Note 126102

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You must process reference interest rates manually

The following are not converted automatically:

- Collateral- Objects- Encumbrances

Check the selection criteria of the files

Foreign currency loans

Other Cleanup Activities

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If your selection criteria for files used for rollovers / processmanagement include

- amounts

and / or

- currencies

you must check these criteria after the conversion and make anynecessary changes:

Procedure:

Rollover or Process Management ...

Other Cleanup Activities: Selection Criteria forFiles

Rollover examples:

Selection criterion before conversion:

- Contract currency and local currency = UNI

- All loans with remaining capital > 50,000 UNI are in file 1.

Selection criterion after conversion:

- Contract currency = EUR

- Actual situation: All loans with remaining capital > 50,000 (UNI) are in file 1.

- Desired situation: All loans with remaining capital > 25,000 (EUR) are in file 1.

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Extract of the cash flow of a euro loan:

Other Cleanup Activities: Euro Foreign CurrencyLoans

(Local currency)...08/01/2001 95.88 UNI Interest debit pos.08/01/2001 32.04 UNI Annuit.repaym. D09/01/2001 95.70 UNI Interest debit pos.09/01/2001 32.22 UNI Annuit.repaym. D10/01/2001 95.53 UNI Interest debit pos.10/01/2001 32.39 UNI Annuit.repaym. D11/01/2001 95.37 UNI Interest debit pos.11/01/2001 32.55 UNI Annuit.repaym. D12/01/2001 95.20 UNI Interest debit pos.12/01/2001 32.72 UNI Annuit.repaym. D12/01/2001 0.01 UNI Exchange rate loss01/01/2002 95.02 UNI Interest debit pos.01/01/2002 32.90 UNI Annuit.repaym. D02/01/2002 94.85 UNI Interest debit pos.02/01/2002 33.08 UNI Annuit.repaym. D...

(Contract currency)...08/01/2001 49.28 EUR Interest debit pos. 08/01/2001 16.47 EUR Annuit.repaym. D09/01/2001 49.19 EUR Interest debit pos. 09/01/2001 16.56 EUR Annuit.repaym. D10/01/2001 49.10 EUR Interest debit pos. 10/01/2001 16.65 EUR Annuit.repaym. D11/01/2001 49.02 EUR Interest debit pos. 11/01/2001 16.73 EUR Annuit.repaym. D12/01/2001 48.93 EUR Interest debit pos. 12/01/2001 16.82 EUR Annuit.repaym. D12/01/2001 0.00 EUR Exchange rate loss01/01/2002 48.84 EUR Interest debit pos. 01/01/2002 16.91 EUR Annuit.repaym. D02/01/2002 48.75 EUR Interest debit pos. 02/01/2002 17.00 EUR Annuit.repaym. D...

In the case of foreign currency loans, changes in exchange rates result in exchange rate gains or losses.

In the case of euro loans, the exchange rates are fixed. Despite the fixed rate, rate gains and losses can arise from rounding differences.

Examples of rate gains or losses from rounding differences: (LC = Local currency)

LC UNI, new loan is granted in EUR

LC UNI, existing loan in UNI converted to EUR

LC EUR, existing loan in "old" local currency UNI

Gains and losses resulting from rounding differences are displayed in the cash flow using the existing algorithm and fixed exchange rates.

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Define flow types for rate gains/losses

Assign the flow types to flow categories:(You make the assignment for the condition group)

Category XF: Recalculate capital amounts during contract currency conversion

Set up account determination

If, as a result of the contract currency changeover, you haveforeign currency loans for the first time, you must make the followingsettings in Customizing:

Other Cleanup Activities: Foreign Currency Loans- Customizing

If you already have foreign currency loans, you can use the existing Customizing settings for foreign currency loans.

Even if no foreign currency loans have been granted so far, some loans may be treated as foreign currency loans in the context of the euro changeover.

When the local currency is changed over to the euro, loans that were originally local currency loans become foreign currency loans.

When the contract currency is changed over to the euro, loans that were originally local currency loans become foreign currency loans.

If new loans are granted in euros before the local currency changeover, these are treated as foreign currency loans (until the local currency changeover).

In all of these cases, you must define flow types for rate gains and losses, assign them to the above flow category and make the settings for account determination.

© SAP AG AC816 11-57

SAP AG 1999

At the end of the dual-currency phase, make sure that all the loanshave been changed over to the euro

You can select all the loans that have not yet been changed over usingthe process management functions.

For more information about the contract currency changeover, see:

- The documentation

- Note 124254

Other Cleanup Activities: General Note

© SAP AG AC816 11-58

SAP AG 1999

Convert loan contracts to the euro

Make the necessary Customizing settings for thechangeover to the euro


Contract Currency Changeover: Unit Summary

© SAP AG AC816 11-59

Contract Currency Changeover Exercises

Unit: Contract currency changeover


• Change over a loan to new contract currency

You arrange with the lender DEUBA to change over the contract currency to the euro.

1 You want to change the contract currency of the loan you have taken out with the DEUBA to the euro. You want to update the planned records directly. Look at the conversion log. Which data was converted?

2 Return to your loan and look at the changes resulting from the conversion.

© SAP AG AC816 11-60

Contract Currency Changeover Solutions

Unit: Contract currency changeover

• You arrange with the lender DEUBA to change over the contract currency to the euro.

1 Convert contract

→ Accounting → Treasury → Loans → Portfolio → Contract Currency Changeover to the Euro → Currency Changeover

2 Display contract → Accounting

→ Treasury → Loans → Transaction Management → General Loan

→ Contract → Display

© SAP AG AC816 12-1

SAP AG 1999

Loans Management within SAP Treasury

Process flow for loans given

Loan contract

Disbursement

Payments due

Closing operations

Special cases

Rollover

Master data


Contents:

Overview of Loans Given

© SAP AG AC816 12-2

SAP AG 1999

Enter loans given that are not posted tocustomer accounts(in order to process intercompany loans)

Make the corresponding Customizing settings


Overview of Loans Given: Unit Objectives

© SAP AG AC816 12-3

SAP AG 1999


Loan contract

Payments due

Disbursement

Closing operations

Condition changes



Course overview


Overview ofloans given


© SAP AG AC816 12-4

SAP AG 1999

As the group headquarters, we advise oursubsidiaries on financing issues.

We provide funds for one of our internationalsubsidiaries by granting a long-term loan of10,000,000 UNI.

Overview of Loans Given: Business Scenario

© SAP AG AC816 12-5

SAP AG 1999

So far, this course has concentrated on the process for loans taken. Thefollowing slides deal with the treatment of "loans given".

They will address the topics that are applicable for loans granted asintercompany loans (not posted to customer accounts). For each topic, onlythe points that differ from the functions already covered will be discussed.

Previous units This unit

Loans taken:

Topics: 1. ...2. ......

Loans given:Key differencesfor the topics: 1. ...2. ......

Preface

This unit does not cover basic functions for loans given that correspond to the functions already discussed for loans taken.

Examples: Condition types and flow types

Loans taken: Condition type "interest": 501 L_Fixed nominal interest Flow type: 1110 L_Interest payable

Loans given Condition type "interest": 201 A_Fixed nominal interest Flow type: 0110 A_Interest debit position receivable

The exact settings in the detail screen differ for loans given and loans taken. However, the previous units contain the information you need to allow for these differences.

Although the detail settings differ, the underlying logic is the same for loans given and loans taken. In both cases, you need to define condition types, assign a flow type, define condition groups, assign corresponding condition types to each condition group and assign the relevant condition group to the product type.

Such analogies are not covered in this unit.

© SAP AG AC816 12-6

SAP AG 1999

Topic: Loans Management within SAP Treasury

Loans Management within SAP Treasury

© SAP AG AC816 12-7

SAP AG 1999


Master dataMaster data Business partners Credit standing check New business tables Filed documents Collateral Object master data Collateral values

Mortgage loans givenMortgage loans given Inquiry by interested

partyApplicationDecision-making

Offer Contract


Position managementPosition management

Evaluation Reports - Information System




The transactions in Loans Management are integrated with the R/3 Financial Accounting component and TR-Cash Management.

A range of programs are available for running evaluations according to different criteria.

© SAP AG AC816 12-8

SAP AG 1999

Evaluation Reports - Information System


Contract offerContract offerInterested partyInterested party ApplicationApplication ContractContract

• Mortgage loans • Mortgage loans• General loans

• Mortgage loans• General loans• Policy loans

• Mortgage loans• General loans• Policy loans

Borrower's note loans: Reservation / order contractBorrower's note loans: Reservation / order contract

(Dec

isio

n-m

akin

g)



The process in the mortgage loan area is the most complex.


© SAP AG AC816 12-9

SAP AG 1999

TR rolesTR roles

Cash manager

Trader

Back office

Staff accountant

Risk controller

Credit Analyst

Staff acc. for loans

...

TR administrator

Treasurymanager

Assignactivities

Generatemenus

Role-Based Menus

The following sample roles for Loans Management (SAP_TR_LO) are delivered with the system:

Credit analyst (credit advisor) CREDIT_ANALYST: Contract negotiation: Collateral/objects, collateral value calculation; collateral value proposal; release of collateral value; credit standing check

Loans officer LOANS_OFFICER: Ongoing business partner and contract management: Business partners; entry of application data; offer creation; contract creation; entry of disbursement; correspondence; release of loan

Rollover officer ROLLOVER_OFFICER: Contract extension: Rollover; Correspondence

Treasury staff accountant for loans STAFF_ACCOUNTANT: Monitoring of postings and payment flows: Posting of transactions; accrual/deferral; position valuation; accounting reports; reversal; posting/checking incoming payments; clearing postings

Loan department manager DEPARTM_MANAGER: Responsible for position management: Release; condition table; reporting

© SAP AG AC816 12-10

SAP AG 1999

Topic: Process Flow for Loans Given

Process flow for loans given

© SAP AG AC816 12-11

SAP AG 1999

1. Disbursement: a) "Preliminary posting": Balance sheet to Bank clearing

b) Bank statement: Bank clearing to Bank

2. Debit position: a) "Preliminary posting": Bank clearing to Balance sheetto Interest revenue

b) Bank statement: Bank to Bank clearing

I. Without customer account

General Posting Options I

If the loan is not managed on the basis of customer accounts, the postings are made directly to G/L accounts (I).

If you do not use customer accounts, the functions for entering payment details are available for payment processing.

© SAP AG AC816 12-12

SAP AG 1999

1. Disbursement: a) "Preliminary posting": Balance sheet to PR clearing

b) Pmnt program for PR: PR clearing to Bank clearing

c) Bank statement: Bank clearing to Bank

2. Debit position: a) "Preliminary posting": PR clearing to Balance sheetto Interest revenue

b1) Customer pays by bank transfer:

Bank statement: Bank clearing to PR clearing

Bank to Bank clearingorb2) Customer pays by direct debit:

Pmnt program for PR: Bank clearing to PR clearing

Bank statement: Bank to Bank clearing

II. Without customer account, using payment program for payment requests (PR)

General Posting Options II

If you do not use customer accounts, the functions for entering payment details are available for payment processing. In this case, you can either post the payment "directly" (see I), or use a payment request (see II).

If you use payment requests, the posting logic is the same as for loans managed on the basis of customer accounts, except that the customer account is replaced by a clearing account for payment requests. This account can then be cleared by a payment program (SAPF111).

© SAP AG AC816 12-13

SAP AG 1999

Payment program for PR

Post interest/repayments due

Pmnt program (PR) and/or bank statement

Application / offer / contract

Disburse contract

Example: Process Flow for Loans Given

PR = Payment request

© SAP AG AC816 12-14

SAP AG 1999

Topic: Loan Contract

Loan contract

© SAP AG AC816 12-15

SAP AG 1999

Interest calculation capital

TimeRepayment:

debitposition

Repayment:incomingpayment

Key:

Planned principle Actual principle

Basic Data: Planned/Actual Principle

Indicator: Planned principle / actual principle: This indicator controls which repayment flows in the cash flow reduce the interest calculation capital.

Planned principle: The reduction in the interest calculation capital is calculated on the basis of the posted and planned debit positions as at the repayment settlement date.

Actual principle: The reduction in the interest calculation capital is calculated on the basis of the posted repayments (incoming payments) in conjunction with the planned repayment debit positions as at the repayment settlement date.

The two variants of the actual principle (1 and 2) differ in the way the principle and interest payments are calculated for annuities, and in the way payments are considered for future calculation periods. If a repayment is delayed or reduced, and you use actual principle 1, the payment instalments for annuities remain constant. If you use actual principle 2, the delay or reduction leads to a change in the payment instalment (see F1 Help).

© SAP AG AC816 12-16

SAP AG 1999



Due on 05/01/YY06/30/YY06/30/YY09/30/YY09/30/YY12/31/YY12/31/YY03/31/YY+103/31/YY+106/30/YY+106/30/YY+109/30/YY+109/30/YY+112/31/YY+112/31/YY+103/31/YY+203/31/YY+2

Settlement amnt100,000.00

1,166.671,333.331,726.672,000.001,691.672,000.001,656.672,000.001,621.672,000.001,551.672,000.001,516.67

2,000.001,481.672,000.00

Curr.UNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNIUNI

Name P

PPPPPPPPPPPPPPPPP

FType00010110012001100120011001200110012001100120011001200110012001100120

A_Loan disbursem.A_Interest deb. pos.A_Instalment repmtA_Interest deb. pos. A_Instalment repmtA_Interest deb. pos. A_Instalment repmtA_Interest deb. pos. A_Instalment repmtA_Interest deb. pos. A_Instalment repmtA_Interest deb. pos. A_Instalment repmtA_Interest deb. pos. A_Instalment repmtA_Interest deb. pos. A_Instalment repmt

Contract - Cash Flow

© SAP AG AC816 12-17

SAP AG 1999


Correspon-dence

Contract - Correspondence

ManDunnLvlDunning per

No dunningLoan contract

Dunning

Dunning history

D.area D.level Last dunn.

Key dateGeneration frequency

Generate upon requestStatement number 0

External acct statement

Interest certificateKey dateProcessing type Generate int. cert. in annual batch

The Correspondence tab is only relevant for loans given. The Dunning section on this tab only applies for loans given managed on the basis of customer accounts.

You can make entries relating to how external account statements are generated and sent out, such as the frequency or the processing type.

© SAP AG AC816 12-18

SAP AG 1999

Contract: CorrespondenceContract: CorrespondenceEdit

Loan number.:Main borrower:

10000000SmithDC 20433 Washington

LOAN CONTRACT

The lender ... shall grant John Smith a mortgage loan of USD ... under thefollowing conditions:

Generate correspondence

Correspondence activity

Lang.

EN

EN

CA

2920

1060

Name

Ext. account statement

Mortgage loan contract

Contract - Generate Correspondence

You can trigger individual correspondence from the loan (application, offer, contract). The documents are defined in Customizing and grouped into correspondence activities.

Mass processing for correspondence is supported by the process management functions.

© SAP AG AC816 12-19

SAP AG 1999

Define CorrespondenceActivities

DGrp

DARVLetter nameCONTRACT.MORTGE

Letter description

Mortgage contract

CA

1010:1060

Name of correspondence activity

Mortgages: Interested party processing

Mortgages: Contract processing

Code

Mortg.

Corr. act. Corr. act. name

CA

1060

SNo

5

ROri

0100

RType

0100

Letter nameCONTRACT.MORTGE

Letterdescr.

Mortgagecontract

+

Loans_

++

Correspondence

Functions_

Assign Transactions toCorrespondence Activities

Assign Documents to Correspondence Activities and Roles

Define Documents

_

1060 Mortgages: Contract processing

Define CorrespondenceClasses

Assign Function/Programto CorrespondenceActivities

Assets/Liab. 0Details

Customizing: Correspondence - General

You define your standard letters for the loans area in the IMG step Documents, and assign each letter to a document group (such as "DARV"). You can define as many letters as you want in each document group using SAPscript.

You define business activities for which you want to generate correspondence. Examples of correspondence activities: offer processing, contract processing.

You then link these correspondence activities to the corresponding transactions or programs in R/3. Example: Assign correspondence activity "contract processing" to the code for Change Mortgage Loan Contract.

At the end, you specify which documents should be generated for which correspondence activities. This is also where you define the recipient of the correspondence: The original is sent to the contract business partner that has the role type defined in the field ROri. A copy is sent to the business partner with the role type defined in the field RType. If the role types are identical, the system only generates one letter. You must specify whether the entry applies for loans given or loans taken (asset/liability).

In Customizing, you can define correspondence classes. These are entered in the detail screen for a document. If the user selects a correspondence class in the business partner overview for a loan, documents in this class are excluded for this partner for this particular loan.

© SAP AG AC816 12-20

SAP AG 1999

EFTyp

100

101

Name

Principle change

Disbursement

Dependent on company code and language

EFTyp

100

300

Name

Principle change

Interest

Dependent on company code and report category

RCol

1

Dis

1

FTyp

0001

2001

Name

Loan disbursem.

Interest IP

Dependent on company code and report category

EFTyp

100

300

Name

Principle change

Interest

Customizing: Correspondence - External Flow Types

Functions_

_

_ Correspondence

External Flow Types

Define External Flow Types

Assign External Flow Typeto Report Category

Assign External Flow Typeto (Internal) Flow Type

In order to generate a payment schedule, account statement or interest certificate, you must define and assign external flow types (in addition to the other word processing settings).

You use external flow types to disclose the flows you want to be visible to the recipient of the document. In Customizing, you define which internal flow types are behind an external flow type. You can group several internal flow types into one external flow type.

The advantage of external flow types is that several similar internal flow types can be displayed as one item with a name (= the external flow type) that is meaningful to the recipient.

© SAP AG AC816 12-21

SAP AG 1999

Topic: Disbursement

Disbursement

© SAP AG AC816 12-22

SAP AG 1999

Create Disbursement: Basic DataCreate Disbursement: Basic Data

Disbursement basic data

CoCdLoan

Flow typeTextPayment dateIntValDateWithhold. up toPosting control


A_Loan disbursement

Capital dataCurrent contr. cap.Nominal capitalDisbursement in %Gross pmnt amountNet pmnt amount

Disbursement rate

General loanLoan partner 00

000140000000

33A

0001

05/01/YY05/01/YY05/01/YY

100,000.00 UNI 0.00 100.0000 100,000.00 UNI

100.00000

99,900.00

Automatic debit position

Incl.

Contract: Disbursement

DBGIRUN

© SAP AG AC816 12-23

SAP AG 1999


PR clearing acct11888

1) 100,000 100,000 1)

1) Loan disbursement

Loan is flagged as 'disbursed' in the system.

However, the borrower has not yet received the payment.

Disburse Contract: Posting


The contract is flagged as disbursed in the system.

At this point, however, the borrower has not yet received the disbursement payment.

To make the actual payment to the borrower, you must run the SAP payment program.

The contract is flagged as "disbursed" as soon as you save a disbursement.

© SAP AG AC816 12-24

SAP AG 1999


PmntPmntreq.req.

Paymentadvicenote

Transfer

Eurocheck

Check

Editproposal

Currentparameters

Paymentcontrol

Paymentsummary

Print program

MasterDocu-ments

IDOC

Proposal dataset

Print dataset

Payment run

Proposal run

© SAP AG AC816 12-25

SAP AG 1999



1) 100,000 100,000 1)

2) Payment program for payment requests3) Bank statement


Bank account113100

2) 100,000

100,000 2) 3) 100,000 100,000 3)

Disbursement: Payment Program for PaymentRequests - Postings


(2) Once the payment program has been run, the borrower receives the loan amount either by bank transfer or by check.

(3) Your house bank carries out the transfer and debits your current account. Upon receipt of the bank statement, you process this data in the system.

© SAP AG AC816 12-26

SAP AG 1999

Topic: Payments Due

Payments due

© SAP AG AC816 12-27

SAP AG 1999



Payment program

Debit position

Disburse contract

Application/Offer/Contract

Example Business Process: Debit Position

© SAP AG AC816 12-28

SAP AG 1999

The automatic debit position run also:

Clears receivables(if the incoming payment is created automaticallyduring the debit position run)

Automatic Debit Position Run - Tasks

The receivables are cleared by the debit position run if you have set the 'Generate incoming payment immediately' indicator. In this case, the system automatically makes a posting to the bank clearing account parallel to generating the debit position.

© SAP AG AC816 12-29

SAP AG 1999

Automatic Posting: Post Planned Records

?

totototo

000140000000


Upto and including due date

x Test run x Log

40 118888 UNIPR clearing acct

2,500.00 D

40 UNILoans46020 1,333.33 C

50 273100Interest revenue

UNI 1,166.67 C

Planned record selection

Posting control

© SAP AG AC816 12-30

SAP AG 1999



1) 100,000 100,000 1)

4) Post planned records: Post (interest and repayment) amounts due ( P-->I)


Bank account113100

2) 100,000

100,000 2) 3) 100,000 100,000 3)

Interest revenue273100

100,000 3) 1,166.67 4)4) 2,500.00

1,333.33 4)

Posting Planned Records Due




(4) You generate receivable items for the date when the interest and repayment are due. You post the amounts due using the debit position run (Post Planned Records).

© SAP AG AC816 12-31

SAP AG 1999



Payment program

Disburse contract

Incoming payments

Application/Offer/Contract

Example Business Process: Incoming Payment

In the case of loans given, credit postings result from:

Direct debit (collection authorization)

or

Bank transfers from the borrower

However, this only applies when the system has been set up to create a corresponding incoming payment posting in the loan subledger for each debit item it generates.

If the incoming payment is not generated automatically, and the loan is not posted to a customer account, no information is returned to the subledger to indicate whether the payment has actually been received.

© SAP AG AC816 12-32

SAP AG 1999

Payment received fromcustomer


Bank statement

By bank transfer orby check By direct debit

Payment Options

Payment processing in the system depends on how the payments are made by the customer:

If the customer pays by transfer, you receive the payment and the related information in the statement from your house bank.

If the customer pays by direct debit, you trigger payment by executing the payment run. The money is collected using the payment media generated. The bank statement informs you of the incoming payment.

© SAP AG AC816 12-33

SAP AG 1999

The following data is required for the debit memo procedure:

Bank details and collection authorization(Application: Business partner master record)

Bank type for the condition: Payment method 'E' in the condition(in the loan)

Debit Memo Procedure

© SAP AG AC816 12-34

SAP AG 1999


PmntPmntreq.req.

Paymentadvicenote

Transfer

Eurocheck

Check

Editproposal

Currentparameters

Paymentcontrol

Paymentsummary

Print program

MasterDocu-ments

IDOC

Proposal dataset

Print dataset

Payment run

Proposal run

© SAP AG AC816 12-35

SAP AG 1999



1) 100,000 100,000 1)

5) Payment program for payment request6) Bank statement


Bank account113100

2) 100,000

100,000 2) 3) 100,000 100,000 3)


100,000 3) 1,166.67 4)4) 2,500.00

1,333.33 4)

5) 2,500.00

2,500.00 5)

6) 2,500.00

2,500.00 6)

Incoming Payments by Direct Debit





(5) Payment program for payment requests; generation of payment media; presentation of the debit memo to the house bank.

(6) Receipt of the bank statement, which displays the posted credit item resulting from the direct debit.

© SAP AG AC816 12-36

SAP AG 1999



1) 100,000 100,000 1)

5) Incoming payment of due amounts (for example, by bank transfer)


Bank account113100

2) 100,000

100,000 2) 3) 100,000 100,000 3)


100,000 3) 1,166.67 4)4) 2,500.00

1,333.33 4)

5a) 2,500.002,500.00 5a) 5b) 2,500.00

2,500.00 5b)

Incoming Payments by Bank Transfer





(5) Receipt of the bank statement, which displays the posted credit item resulting from the bank transfer made by the borrower.

© SAP AG AC816 12-37

SAP AG 1999

No significant differences

Topic: Closing Operations

Closing operations

© SAP AG AC816 12-38

SAP AG 1999

Topic: Rollover

Rollover

© SAP AG AC816 12-39

SAP AG 1999

General file, main file, file

Register

Functions

Table

Variants

Modifications

Rollover: Central Terms

You select the loans to be rolled over by defining appropriate selection criteria. You can group the loans selected into different files for processing. (Example: File 1: Mortgage loans, File 2: General loans). A file in the system is comparable to a physical file. A file is subdivided into registers. (Example: File 1: Registers "Not processed", "In process" and "Completed"). Various functions are available for each register: (Example: Register "Not processed": Functions "Create offer", "Print offer"; Register "In process": Function "Print offer").

The tables are special condition tables for rollover. (Example: Table 1 for mortgage loans, table 2 for general loans). You can define an unlimited number of variants for each table, that is, different "sets" of conditions with different interest or repayment clearing terms. For each table, you can define modifications that can be used to change specific loan conditions (if they are defined as permitted in Customizing).

For the rollover function, the file structure is relevant for mass processing as well as for individual rollover. Tables, however, are only required for mass processing.

© SAP AG AC816 12-40

SAP AG 1999

How is the rollover carried out?How is the rollover carried out?

What is the result of the rollover?What is the result of the rollover?Offer(s) Contract

Which contracts are rolled over?Which contracts are rolled over?

FilesFiles

Main filesMain files


or inor in

or inor inContractsContractsin specificin specific

Variant 1:Variant 1:

Variant 2:Variant 2:

Variant nVariant n

(Modification(s))(Modification(s))

(Modification(s))(Modification(s))TableTable

Rollover - Overview

A rollover always relates to a certain number of contracts which correspond to your selection criteria. You roll over the contracts for a file, a main file or a general file.

You define the rollover conditions in a table. A table consists of variants and modifications.

In the first rollover step you generate offers to send to your borrowers using the mass processing function. You then create a contract from the offer accepted by the borrower using the individual rollover function.

You can also omit the offer step and use the rollover function to create contracts directly.

The offers/contracts consist of the condition header and the related condition items.

© SAP AG AC816 12-41

SAP AG 1999

Rollover: Filling Files

Print parameters - log

Log level

Execution parametersTest run

Refer. date

Rollover main fileCompany codeMain fileVersion YYYYMMVersion number

Online executionExecute in batch imm.

Schedule batch

Print/spool param. log

05/12/YY

0001Rollover05YYYY05001

9

x

x

You trigger the Fill Main File function for each main file. This fills the files with the loans to be processed.

The reference date must be a date between the Fixed from and Fixed until dates for the loans to be selected.

When the file is filled, the system calculates the values for all the capital fields as at the end of the fixed period. For performance and architecture reasons, the capital fields are not updated automatically. As a result, if you subsequently require the current capital values for the loans in the rollover process, you must use the Update file function. The capital fields of the loans selected are updated for the calculation date. If necessary, contracts with a remaining capital amount of zero are reassigned to a specific register.

© SAP AG AC816 12-42

SAP AG 1999

Create TableCreate Table

Company codeTableTable YYYYMM

Rollover: Creating Tables I

Reference

Company codeTableVersion YYYYMMVersion number

0001Rollover05YY05

You set up tables for creating rollover offers. These tables contain the conditions for the new fixed period.

© SAP AG AC816 12-43

SAP AG 1999

Create TableCreate Table

Company codeTableTable YYYYMMVersion numberName

Effective fromReserv. period

Auth. groupStatus

Rollover: Creating Tables II

Variants Modifications

06/12/YY06/30/YYEffective to

End cond. res.W605/01/YY

Rollover May001YYYY05Roll_050001

The date on which you carry out the rollover in the system must be between the Effective from and Effective to dates.

In the Reserv. period field, you specify how much time the customer has to reply. The reservation period is calculated from the date when the offer is created in the system. If the reservation period has expired, all contracts not processed are automatically transferred to a register defined specifically for this purpose.

If you make an entry in the End cond. res. field, all contracts not processed on this date are also transferred accordingly.

If you make entries in both of these fields, the shorter period is applicable.

A table can have different statuses: "Undefined" (is currently being created), "To be released", "Released", "Deactivated".

If you specify an authorization group in the rollover table, only employees with the corresponding authorization group may process the table.

© SAP AG AC816 12-44

SAP AG 1999

Create variantsCreate variants

TableNameEffective fromReserv. period

Status Released

Effective toEnd cond. res.

Rollover: Variants

W605/01/YY

Roll_05Rollover May

05/01/YY06/12/YY

YY05 001

Condition variants

Rnk Fxd int. Unit + Toler. P - Toler. P DRate % Nom. int.

Selection criteriaSelection criteria -> Loans that fulfill-> Loans that fulfillthese criteria are rolledthese criteria are rolledover using variant 001over using variant 001

8.5000001 3 Y 2 M 2 M 100.00

Edit SC

You can define an unlimited number of variants ("sets" of conditions) for each table. Via the selection criteria, you can define which loans should be rolled over using the conditions for each of the variants.

To define new conditions for all the loans selected, you can use tolerance limits to extend the validity:

A variant applies for all loans with a remaining term longer than or equal to the "fixed interest period minus the negative tolerance".

If the remaining term is shorter than or equal to the "fixed interest period plus the positive tolerance", the condition applies for the whole of the remaining term (the fixed interest period is extended to cover the remaining term). If the remaining term is longer than this limit, the new condition applies for the fixed interest period defined.

The sequence of the different variants is not relevant for creating offers, since the system creates as many offers as there are valid variants. If contracts are created immediately, the first valid variant in the sequence is used.

© SAP AG AC816 12-45

SAP AG 1999

All loans with remaining term: Offer conditions fixed for:

a) >= 2 years and 10 months The total remaining termand (2 years and 10 or 11 months;<= 3 years and 2 months 3 years; 3 years and 1 or 2 months)

b) > 3 years and 2 months 3 years

Condition variants

Rnk Fxd int. Unit + Toler. P - Toler. P DRate % Nom. int. 001 3 Y 2 M 2 M 100.00 8.5000

Variants: Tolerance Limits - Examples

Above example:

If no tolerance limits are specified, the new conditions only apply for those loans with a remaining term of exactly three years. All other loans (remaining term shorter or longer than 3 years) are not considered.

You can use the tolerance limits to ensure that loans with a remaining term slightly longer (or shorter) than the standard fixed interest period for the variant are also considered. If this was not the case, contracts that exceed the remaining term (for example, 3 years and 1 month) would have to be rolled over twice. The first set of conditions would be fixed for 3 years. After these three years, you would have to agree on new conditions for the remaining month.

Additional example:

Fixed int.period + Tolerance - Tolerance Variant 1 2 years 6 months 2 years Variant 2 5 years 1 month 2.5 years Variant 3 10 years - 4 years

How many alternative offers does the borrower receive for the new condition period? Answer: 3

© SAP AG AC816 12-46

SAP AG 1999

Create Modification(s)Create Modification(s)

TableNameEffective fromReserv. period

Status Released

Effective toEnd cond. res.

Rollover: Modification(s)

W605/01/YY

Roll_05Rollover May

05/01/YY06/12/YY

YY05 001

Condition modifications

Rnk SC Short name Ref. Modified val. MOpt Sign Var.no.Nom. percent. 0.5 X 002MNx

Edit selection

You can use modifications to configure the new conditions as well as to change other fields (in addition to the fields offered in the variants).

Example: The nominal interest entry for variant 002 is "0"; this means that the values are transferred from the old contract. If the modification has entries as in the above example, the entry "+0.5" means that the interest value transferred is increased by 0.5 percent.

You define the loans for which the modification data applies via the selection criteria. By specifying a variant number, you can define that the modification should only apply for those loans rolled over with the corresponding variant.

© SAP AG AC816 12-47

SAP AG 1999

FileFile

Main fileMain file


Individual rolloverIndividual rollover

Edit

Display

Edit

Display

EditDisplay

Edit

Rollover: Processing Options

You can roll over individual loans using the Individual Rollover function. The mass processing function is accessed by selecting all the loans to be processed from a specific file, main file, or general file. You define how the user is allowed to access the mass processing function in Customizing.

You can use the mass processing function to create offers or contracts. If the customer decides to accept one of several offers, you transfer the offer data to a contract using the individual rollover function.

You can use the individual rollover function to create offers or contracts, or to transfer offer data to a contract.

© SAP AG AC816 12-48

SAP AG 1999

Company codeMain file Version YYYYMM No.

Rollover: Register Overview I

File information

No. of loans Totals

Register overview

0001Rollover05 YYYY05 001

369,827.72 322,527.755

Rnk Short name No. of loans Contract capital Rem.cap.deb.pos.UB Not processed 5 269,827.72 222,527.75

: : : : :

In Customizing you define which registers the system should create for each file. Registers are subdivisions of the file. It is useful to create registers that classify the loans according to the rollover processing status.

By selecting a register, you can display the overview of the loans in this register. You can then process the contents of the register.

© SAP AG AC816 12-49

SAP AG 1999

File/register information

Main file

Register

No. of loans

Loan overview

N

P R

Contract no.

100001237

101085536

X

X

N

Dialog individual rolloverDisplay contractCreate rollover offersPrint rollover offersRemove rollover offers...

Function overviewSelect processing function

11NNN

Rollover: Selecting the Processing Functions

Rollover05UB

5

To process the loan(s) in this register, select the loan and choose Functions. The Select Edit Function dialog box appears. You can use functions such as Create rollover offers or Print rollover offers. In Customizing you define the processing functions available in each register.

All the selected loans are processed by the function you have chosen. The reference date is the processing date; if you want to use the conditions defined in a table, the reference date must be between the Effective from and Effective to dates of the relevant table.

The rollover generates new condition headers of the following types:

Offer: Document that has not yet been signed. It contains the new conditions for the next fixed interest period to be used for a loan rollover. The loan partner can accept or reject this offer.

Contract offer: Offer signed by the lender. If the customer accepts the offer and signs the document, the contract becomes legally binding.

Contract: Legally binding contract signed by both parties.

Rollover contract: Contract document generated by the rollover function and signed by the lender before being sent to the borrower for signature.

Fixed contract: Contract that is legally binding when created. In this case, neither the signature nor the consent of the borrower is required. The system currently processes "offers" (offer; contract offer) and "contracts" (contract; rollover contract; fixed contract).

© SAP AG AC816 12-50

SAP AG 1999

Print/spool param. log

On key date

Rollover: Creating Contract Offers

Print parameters - log

Log level 9

Execution parameters

Rollover table

Company codeMain fileTable YYYYMMTable number

Rollover date

End of fixed interest period

0001Roll_05YYYY05001

05/31/YY

Online executionExecute in batch imm.

Schedule batchTest run

Refer. date

After you have selected a function, a screen appears in which you can define the execution parameters.

Here, you specify which rollover table should be used. You also define whether the rollover offer should be created online or as a background job.

You have two options for setting the rollover date ( = Effective from date for the new conditions):

You can choose the end of the fixed interest period - this can vary for each contract.

You can specify a fixed key date from which the new conditions for all loans affected by this rollover apply.

© SAP AG AC816 12-51

SAP AG 1999

Company codeMain file

Rollover: Register Overview II

File information

No. of loans

Register overview

Rnk Short name No. of loans Contract capital Rem.cap.deb.pos.

UB Unprocessed 4 69,827.72 222,527.75

: : : : :

AE Roll. offer created 1 100,000.00 100,000.00

Totals 369.827,72 322.527,755

0001Rollover05

In Customizing, you can define whether contracts that have been processed should be transferred to a specific register or removed from the rollover process.

Example: An offer is created for a loan that was previously in the register "UB" - Not processed. In accordance with the settings in Customizing, the loan is automatically transferred to the register "AE" - Offer.

© SAP AG AC816 12-52

SAP AG 1999

1. Create and fill file structure.

2. Create tables- Variants- Modifications

3. Edit files- Create and print offers- Create and print rollover contracts- Remove loans from the file structure

Rollover: Process Overview

© SAP AG AC816 12-53

SAP AG 1999

Activity type

Logical fields

Registers

Report functions

Transaction functions

Functions/register

Variant-relevant condition types

_

Customizing: Rollover

Loans

_

_ Functions

Rollover

You make the Customizing settings for the rollover functions in the IMG under Functions -> Rollover.

© SAP AG AC816 12-54

SAP AG 1999

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Activity type PAssign Functions to Register

Customizing: Assign Functions to Register

In order to ensure controlled loan processing, you assign the report and transaction functions (FCd) you have defined to the individual registers. This means that in the application the user can only access a selection of the functions for each processing status (register).

In the columns File, Main file, General file, you define whether the corresponding processing function is permitted if it is accessed via the menu options File/Main File/General File --> Edit.

You define one editing function for each register - this is then the default in the application selection screen.

The last column contains the sequence in which the processing functions are displayed in the selection screen.

© SAP AG AC816 12-55

SAP AG 1999

Activity type P Rollover

Customizing: Variant-Relevant Condition Types

FCat Flow category CTypTTAN Annuity repayment 261TZ Nominal interest 201TV Repayment settlement 204

You assign the condition types to be filled by data from the table to activity type "P".

© SAP AG AC816 12-56

SAP AG 1999

Rollover correspondence

Define documentsDefine correspondence activitiesAssign function/program to correspondence activitiesAssign documents to correspondence activities androles

Customizing: Rollover - Word Processing

The Customizing settings for correspondence also apply for rollover correspondence. You assign the functions/programs that you have defined under rollover/report functions to the correspondence activities.

© SAP AG AC816 12-57

SAP AG 1999

Topic: Master Data

Master data

© SAP AG AC816 12-58

SAP AG 1999

Integration with R/3 FI / TR CashManagement

Master dataMaster data Business partner Credit standing check New business tables Filed documents Collateral Object master data Collateral values

Transaction mgmtTransaction mgmt Interested parties

ApplicationDecision-making

Offer Contract


PortfolioPortfolio

Evaluations in the information system

Overview of the Process for New Business -Mortgage Loans

You can manage various types of data as "master data" in the system.

For both loans given and loans taken, you have to enter master data for the business partner before you can create a loan.

Entry of all the other types of master data is optional. Which master data is useful will depend on the type of loan (loan given or loan taken).

© SAP AG AC816 12-59

SAP AG 1999

Evaluations in the information system


ContractContractofferofferInterest.partyInterest.party ApplicationApplication ContractContract

• Mortgages • Mortgages• General loans

• Mortgages• General loans• Policy loans

• Mortgages• General loans• Policy loans

Borrower's note loans: Reservation / Order ContractBorrower's note loans: Reservation / Order Contract

Dec

isio

n-m

akin

g

Possible Procedures in Loans Management

You can use the transaction management functions to map the loan process from contract negotiation through to contract conclusion.

Suggested process flow for intercompany loans given and received: Loans taken: Contract Loans given: Application / offer / contract

If you grant loans to private or corporate customers, it can be useful to enter inquiries from potential customers ("interested parties").

The decision-making option is a more comprehensive function for generating offers, which takes various decision parameters into account, including the application data, the customer's credit standing, objects and collateral values. Usually, this data is only required when you grant loans to private or corporate customers.

The functions for managing interested parties and decision-making are not relevant for loans taken or loans granted as intercompany loans.

© SAP AG AC816 12-60

SAP AG 1999

Partners

Credit standingcalculation

Collateralvalue

Objects

Collateral

New businesstable

Fileddocuments

Loan

Master Data - Overview

Business partner: Main loan partner

Credit standing check/credit standing calculation:* Sets a borrower's monthly income against the charges on this income (private or corporate customer).

New business table: Predefined interest and repayment conditions that can be used as standard conditions when contracts are created.

File management:* The files you manage in the system are "checklist files". The file contains a checklist indicating which documents are (should be) in the corresponding physical file.

Collateral:* Used for managing the data relating to assets that serve as loan collateral. Collateral objects can be assigned to loans for which the flag Collateral objects active is set in the product type definition.

Objects:* In the R/3 System, all real estate collateral in the form of land and buildings is entered under "objects". "Collateral" covers all other collateral except for land and buildings. You use the master data functions for objects to manage the data for land and buildings that serve to secure a loan. Objects can be assigned to loans that belong to the product category "mortgage loan" for which the flag Objects active is set in the product type definition.

Collateral value calculation:* Data used to calculate and fix the collateral value of an object.

* Applicable for loans granted to private and corporate customers, but not for intercompany loans.

© SAP AG AC816 12-61

SAP AG 1999

New businesstable

Collateral

Objects

Credit standingcalculation

Partners

Collateralvalue

Fileddocuments

Loan

Master Data - New Business Table

© SAP AG AC816 12-62

SAP AG 1999

TableEffective from

MORTG_0105/01/YY

YY 05 001

Rnk

001

Fxd int.

2 Y

DRate %

98.00000

Nom. int.

Repayment

6.00000

4.00000

Ref. int.

Rep. sett.

PF

PF

PE

PE

Frq

3

3Frq

IS

IS

+/-

PF

EIM

1

PE

ICM

Frq

Condition variants

Contract: ConditionsContract: Conditions

Items

Nominal interest

Annuity repmnt

6.00000 3

4.00000 3

X

X

Condition table

1

05/31/YYEffective to

U

New Business Table

You can let the system enter the condition items for a contract offer automatically on the basis of predefined conditions in a new business condition table. Condition tables speed up and simplify condition entry, and enable you to avoid input errors.

In the loan, choose Condition table, and select the relevant table with the appropriate condition variant. You can only use tables that are effective for the Fixed from date of the loan.

You can deactivate or delete new business tables. You can also display deactivated tables and use them as a reference for creating new tables. Deleted tables can only be displayed. You cannot reactivate or delete deactivated tables. If the release procedure is active for new business tables, and the table has been released, it can only be deactivated, not deleted. If the release is active but the table has not yet been released, or the release is not active, a table cannot be deactivated, it can only be deleted.

If you specify an authorization group in the new business table, only employees with the corresponding authorization group may process the table.

© SAP AG AC816 12-63

SAP AG 1999

1. Functions -> Process Management

Activity type 'N' has to be maintained!

2. Transaction Management -> Condition Types -> Define Condition Types for New Business Table

Activity type N New business

Customizing: Condition Tables

FCat Flow category CTyp

TTAN Annuity repayment 261

TZ Nominal interest 201

Assign the condition types to be filled by data from the table to activity type "N".

© SAP AG AC816 12-64

SAP AG 1999

Data Further processing

- Loan master data- Business partners- Objects- New business table- Business operations- Capital transfer- Reversal- Disbursement

Release

Loans: Release

The report program for release has been replaced by the release workflow.

The system allows you to use a staggered release procedure for most functions in master data and flow processing. The release procedure is based on a principle of multiple control by at least two persons.

Release objects:

1 Flow data: Business operations*, capital transfers, reversals, disbursements *(3 release objects: Enter Charges Individually, Enter Charges as Business Operation, Unscheduled Repayment)

2 Central master data: Loan master data, business partners, objects

Generic workflow functions:

Definition of maximum times for work items: Pickup, processing, throughput time

Creation of attachments

Forwarding

Resubmission

User-specific adjustments to the workflow, for example:

Throughput times

User control settings for assigning work items to certain users (agents). Users can be assigned on the basis of the release object, company code, release level, or product type. For more information, refer to the documentation in the SAP Library (BC - Basis -> SAP Business Workflow).

© SAP AG AC816 12-65

SAP AG 1999

Topic: Contract Currency Changeover


© SAP AG AC816 12-66

SAP AG 1999

Loan contractLoan contract

Loan contract1,000,000 UNI

Contract currency changeover1,000,000 UNI

1,000,000 UNI

Loan contract

1,000,000 UNI

Loan contract

1,000,000 UNI

Loan contract

1,000,000 UNI

Loan contract

1,000,000 UNI

Loan contract

1,000,000 UNI

Loan contract

1,000,000 UNI

Loan contract

500,000 EUR

Process management

4 Logs

+

Update files, if required

CCC: Mass Processing

You can use the process management functions to carry out a mass contract currency changeover run.

After the mass changeover, the system outputs 4 logs: 1. Process management log 2. Contract currency changeover log 3. Posting log for the postings generated 4. Error log for the postings with errors

Loans that contain errors are not changed over and the system puts them in a suspension register.

After the contract currency changeover, the system does not update the capital amounts for the loans in the folder but continues to display them in the original currency. This is for system performance reasons. If the file is updated, you can see the capital amounts in euros on the detail screens.

© SAP AG AC816 12-67

SAP AG 1999

I. Customizing for the changeover to the euro

II. Additional Customizing settings for process management

1. Define activity type: E

2. Define logical fields (such as the contract currency field)

3. Define the register (incl. the exclusion register)

4. Define report program functions- EUR EUR_Contract currency changeover- POFU Fill filesIf correspondence is required:- ADDR Notification of CCC to the euro

5. Assign functions to the register

6. If correspondence is required:Correspondence settings in Customizing:- Assign function code ADDR to correspondence activities- ...

7. Installation parameters: Set format to X_65_132

CCC: Mass Processing - Customizing

Suggested registers:

1. Not processed 2. EUR-CCC completed 3. EUR-CCC correspondence generated 4. Excluded

Function calls for the report functions:

POFU fill file: RFVDPSF1

EUR CCC: RFVDEMU3

ADDR notification: RFVDPF01

© SAP AG AC816 12-68

SAP AG 1999

Enter loans given that are not posted to customeraccounts(primarily in order to process intercompany loans)

Make the corresponding Customizing settings


Overview of Loans Given: Unit Summary