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TRGV_AM_PROC - Define Amortization Procedure

ABAP Short Reference   TXBHW - Original Tax Base Amount in Local Currency  
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Define valuation procedures for the valuation category Amortization that distribute the premium or discount (the difference between payment and repayment amounts) over the term.

The valuation category is relevant for the position management categories Securities/Loans/Money Market Transactions/Listed Options, Normal Style (Without Index-Linked Bonds), Securities/Loans with Installment Repayment (Without Index-Linked Bonds), and Index-linked Bonds.

For more information, see also Amortization in product assistance.

1. Choose New Entries.
2. Name the procedure and enter a description.
3. Define the calculation category [Scientific Amortized Costs (SAC) or Linear Amortized Costs (LAC)].
4. Set the Gross/Net indicator.
1. Net
   In the case of the net procedure, the position is posted with its acquisition value (book value = acquisition value) and is amortized over the remaining term
   (book value = acquisition value + amortization).
2. Net; Separate Balance Sheet Accounts for Amortization
   Negative and positive amortizations for a position caused by changes to the position, transfer postings, or key date valuations are posted to separate accounts in Financial Accounting.
   Note: You need to determine the relevant account assignment for update types for positive and negative amortizations.
   After posting the amortizations, the balance of both accounts is automatically compared. If both accounts show a balance for this position, the account with the lower balance is cleared via the account with the higher balance by an adjustment flow.
3. Gross:
   In the gross procedure, the premium/discount is posted as an accrued/deferred asset or liability and written off, affecting net income, over the term of the amortization.
4. Gross; Premium/Discount Not Included in Book Value:
   If you set this indicator, the system determines the book value of the position from the total of the amortized acquisition value and valuations – as for the net procedure. The premium/discount is nevertheless posted on purchase and written off, affecting net income, over time.

1. Gross; Separate Balance Sheet Accounts for Accruals/Deferrals:
   In the case of the gross procedure for amortization, you can manage accruals/deferrals (depending on whether premium or discount) in separate accounts for accounting purposes. Only one of the accruals/deferrals of a position may have a balance other than zero. So the accrued/deferred assets can show balances on the debit side and the accrued/deferred liabilities can only show balances on the credit side. The setting takes these requirements into consideration by generating corresponding adjustment flows.

1. Enter the time up to which amortization should be carried out under Amortization to:
1. Amortization up to end of term/end of fixed interest rate period
2. Amortization to next issuer's termination date
3. Amortization until the end of the fixed interest period
4. Amortization to termination date / end of the fixed interest period
2. You can set the Exclude Final Amortization Date from Amortization Period for LAC procedures.
3. Set the Other Components indicator to manage additional position components.

• Initial
  No additional components are managed.

• Deferral Item, Purchase Value
  The position component Deferral Item, Purchase Value is also managed.

• Negotiation spread, linear

You can manage the position components Amortization with Negotiation Spread (1019) and Deferral Item for Purchase Value (1010) (as auxiliary position components for the negotiation spread to be amortized). You can also use the Amortization position component (1007) to manage the amortization with issue spread.

• Negotiation spread, exponential

You can manage the position components Amortization with Negotiation Spread (1019) and Deferral Item for Purchase Value (1010) (as auxiliary position components for the negotiation spread to be amortized). You can also use the Amortization position component (1007) to manage the amortization with issue spread.

• Negotiation spread without amortization

You can manage the position component Deferral Item for Purchase Value (1010) (as an auxiliary position component for the negotiation spread) and manage the issue spread amortization with the Amortization position component (1007).

1. You define how interest is included in the amortization using the Include Interest indicator. For more information, see SAP Library under Transaction Manager -> Valuation -> Amortization -> Amortization according to LAC and SAC -> SAC Procedure without Interest / SAC with Interest and Accrued Interest Adjustment / SAC Procedure with Interest (Cash Flow Method in Accordance with IAS39).
2. You can set the Include Cap. Interest indicator.
3. Choose the accrual/deferral method, for example, if you have chosen Include interest, accrued interest adjustment under Include Interest.
4. You can set the Exclude Interest-Like Flows from Calculation indicator.
5. Treatment of Effective Interest Rate
   You can control how the effective interest rate is calculated when determining the amortized acquisition value. The basis for calculating the effective interest rate is a cash flow in which the amortized acquisition value of the last amortization or at the time of the last position change (such as a purchase) forms the start value. A new cash flow is generated based on this start value and the conditions or redemption schedules.
6. Reset is possible:
   If you set this indicator, the generated amortization flows are reset for mid-year valuations with reset in addition to the remaining flow steps
7. Period Start Date Is at Month-End
   If amortization takes place according to the LAC procedure, the system automatically sets the month-end indicator for your start date.
8. Period End Date Is at Month-End
   If amortization takes place according to the LAC procedure, the system automatically sets the month-end indicator for your end date.
9. Cut SAC Amortization:
   If you amortize a position according to the SAC procedure, the amortized acquisition value can exceed or fall below the nominal amount. This also applies if you have purchased the position below or above par. This indicator controls whether the amortization should be shortened in this case.
10. Amortization for Installment Repayments
    If you set this indicator, a derived business transaction is generated for every installment repayment according to the settings in position management (this applies particularly to amortization.)
11. Set Cut Amortization for Capitalized Interest indicator if needed.
12. Set the Adjustment of Translation Flows for Amortization if needed.
13. Set the indicator Amortization of Value Adjustment Components if needed.
14. Under Settings you can specify in the Currency Conversion field which rate is used for the curreny conversion.
15. Save your entries.

RFUMSV00 - Advance Return for Tax on Sales/Purchases   SUBST_MERGE_LIST - merge external lists to one complete list with #if... logic for R3up  
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