To provide a link to detail documentation of CS Lucas standard accounting treatments.
WHY IS THIS IMPORTANT?
Accounting for Treasury instruments can be complex and various alternative approaches are available. This document summarized the various alternatives and provide links showing detail journals and computation.
LIST OF ACCOUNTING TREATMENTS
|Money Market||Money Market Deposit at Average Rate||Click Here|
|Money Market Loan at Average Rate||Click Here|
|Money Market Loan Rollover – Partial||Click Here|
|Money Market Withholding Tax – Net||Click Here|
|Money Market Withholding Tax – Gross||Click Here|
|Money Market Loan Rollover – Full||Click Here|
|Money Market – Deposit – Negative Interest Rate||Click Here|
|Money Market – Loan – Negative Interest Rate||Click Here|
|Money Market Loan at Spot Rate||Click Here|
|Money Market Loan at Spot Rate – Alt||Click Here|
|Foreign Exchange||Foreign Exchange Outright Base||Click Here|
|Foreign Exchange Outright Cross||Click Here|
|Foreign Exchange Outright Cross Split Swap Cost from SRR||Click Here|
|Foreign Exchange Swap Cross||Click Here|
|Foreign Exchange Swap Base||Click Here|
|Foreign Exchange Rollover||Click Here|
|Foreign Exchange Outright Base – with TDate Journal||Click Here|
|Foreign Exchange Outright Cross – with TDate Journal||Click Here|
|Non-Deliverable Forward||NDF Journal||Click Here|
|Interest Rate Swap||IRS Cross Ccy – Front and Back||Click Here|
|IRS Cross Ccy – Notional||Click Here|
|IRS Same Ccy – Notional||Click Here|
|IRS Same Ccy – Notional – Hedging Derivatives||Click Here|
|Option||Option Long Journal||Click Here|
|Option Short Journal||Click Here|
|Intercompany Funding||Interco Funding||Click Here|
|Term Loan||Term Loan with Interest Capitalisation||Click Here|
|Term Loan Fee Amortisation||Click Here|
|Term Loan – Borrow||Click Here|
|Term Loan – Lend||Click Here|
|Investment – Equity||Investment in Equity||Click Here|
|Investment in Equity FIFO||Click Here|
|Interest on MMF||Interest on Money Market Funds||Click Here|
|Investment – Bond||Investment in Bond – Average at Market Value||Click Here|
|Investment in Bond – FIFO at Amortised Cost||Click Here|
FREQUENTLY ASKED QUESTIONS
FAQ01. Should the ERP system revalue journals posted by CS Lucas?
ERP system must NOT revalue any General Ledger chart of accounts items (except “Cash at bank”) used for treasury transactions that CS Lucas system is posting to. If these journals are revalued or changed and booked (either manually or via integration), we will not be able to provide support to reconcile General Ledger balances (base and currency amount) to the CS Lucas system.
The reason revaluation is not necessary are as follows:
a) CS Lucas will book transactions using the appropriate accounting rate so that the base currency amount are correctly stated. Where necessary, CS Lucas will recompute the appropriate average period exchange rate from the archived end of day rate.
b) At month end, the CS Lucas system generates month end journals for the following purposes:
i) accruals for interest income and expenses
ii) amortization/accretion journals
iiii) revaluation journals to compute the FX gains and losses.
iv) revaluation if monetary assets and liability.
c) Unless otherwise stated, all month end journals above are reversing in nature posted on the following day of the month end.
d) Settlement journals for transactions booked in the CS Lucas assume these above month end journals and their reversal. These settlement journals computes the correct FX realized amount and analyze it between capital and revenue as appropriate.
e) The “Cash at bank” accounts are not revalued by CS Lucas. Therefore, the Cash at Bank account needs to be restated for month end revaluation in the usual manner by the ERP system.