Money Market Deposit at Average Rate

PURPOSE

To show illustration of money market deposit at average rates.

OVERVIEW

i. Deposit revalued to period end closing rate.

ii. Income are reported at average booking rate over the life of the deposit.

iii. Gain and loss arising from foreign exchange movement are analysed into revenue and capital component.

TRANSACTION DETAILS

Accounting Base Ccy
Trade ID
Trade Date
Value Date
Maturity Date
Currency
Amount
Rate
Accrual Method
Total Interest
Maturity Amount
USD
MMK1001
3-Feb-03
3-Feb-03
3-Apr-03
SGD
1,000,000.00
5.1232%
Act/365
8,281.34
1,008,281.34

SUMMARY OF JOURNALS

IDDateDescription
J13-Feb-03Money Market Deposit Start.
J228-Feb-03Money Market Month End Accruals.
J31-Mar-03Reversal Money Market Month End Accruals.
J431-Mar-03Money Market Month End Accruals.
J51-Apr-03Reversal Money Market Month End Accruals.
J63-Apr-03Money Market Deposit Maturity.

J1                          Money Market Deposit Start.

TradeIDPostDateB/PAccountCcyCcy AmountExc RateCcyBase AmountLine
MMK10013-Feb-03BDepositSGD1,000,000.000.567456USD567,456.38J1a
MMK10013-Feb-03BCash at BankSGD-1,000,000.000.567456USD-567,456.38J1b

Note J1a:          The booking rate on 3-Feb 2003 is 1.76225 (multiplier 0.567456). The rate is rounded to 6dp for display. Full precision is used in calculation.

J2                          Money Market Month End Accruals.

TradeIDPostDateB/PAccountCcyCcy AmountExc RateCcyBase AmountLine
MMK100128-Feb-03BDeposit - Interest RecvSGD3,649.400.568919USD2,076.21J2a
MMK100128-Feb-03PDeposit Interest IncomeSGD-3,649.400.571584USD-2,085.94J2b
MMK100128-Feb-03PFX - Unrealised Losses-RevenueSGD0.00USD9.73J2c
MMK100128-Feb-03BDepositSGD0.00USD1,462.45J2d
MMK100128-Feb-03PFX - Unrealised Gains - CapitalSGD0.00USD-1,462.45J2e

Note J2a:          Calculation of Accrual in SGD

Start date3-Feb-03
Month End Date28-Feb-03
Days (include 28-Feb)26=A
Start date3-Feb-03
Maturity Date3-Apr-03
Days (exclude 3-Apr)59=B
Total Interest8,281.34=C
Period Interest3,649.40=C*A/B

Note J2b:         The average multiplier rate between 3-Feb and 28-Feb is 0.571584. See Exchange Rates below. The rate is rounded to 6dp for display. Full precision is used in calculation.

Note J2c:         The unrealised foreign exchange loss on interest income is analyzed as follows:

SGDRate+
USD
At Closing Rate3,649.400.568919
2,076.21
At Average Rate3,649.400.571584
2,085.94
Loss in exchange
-9.73

+ Rates used for calculation are in full precision. Illustrated rates are rounded to 6dp.

Note J2e:         The unrealised gain on the revaluation of the deposit is analyzed as follows:

SGDRate+
USD
At Closing Rate1,000,000.000.568919
568,918.83
At Start Rate1,000,000.000.567456
567,456.38
Gain in exchange
1,462.45

+ Rates used for calculation are in full precision. Illustrated rates are rounded to 6dp.

J3                          Reversal Money Market Month End Accruals.

TradeIDPostDateB/PAccountCcyCcy AmountExc RateCcyBase AmountLine
MMK10011-Mar-03BDeposit - Interest RecvSGD-3,649.400.568919USD-2,076.21J3a
MMK10011-Mar-03PDeposit Interest IncomeSGD3,649.400.571584USD2,085.94J3b
MMK10011-Mar-03PFX - Unrealised Losses-RevenueSGD0.00USD-9.73J3c
MMK10011-Mar-03BDepositSGD0.00USD-1,462.45J3d
MMK10011-Mar-03PFX - Unrealised Gains - CapitalSGD0.00USD1,462.45J3e

J4                          Money Market Month End Accruals.

TradeIDPostDateB/PAccountCcyCcy AmountExc RateCcyBase AmountLine
MMK100131-Mar-03BDeposit - Interest RecvSGD8,000.620.577434USD4,619.83J4a
MMK100131-Mar-03PDeposit Interest IncomeSGD-8,000.620.571775USD-4,574.56J4b
MMK100131-Mar-03PFX - Unrealised Gains-RevenueSGD0.00USD-45.27J4c
MMK100131-Mar-03BDepositSGD0.00USD9,977.50J4d
MMK100131-Mar-03PFX - Unrealised Gains - CapitalSGD0.00USD-9,977.50J4e

Note J4a:          Calculation of Accrual in SGD

Start date3-Feb-03
Month End Date31-Mar-03
Days (include 31-Mar)57=A
Start date3-Feb-03
Maturity Date3-Apr-03
Days (exclude 3-Apr)59=B
Total Interest8,281.34=C
Period Interest8,000.62=C*A/B

Note J4b:         The average multiplier rate between 3-Feb and 31-Mar is 0.571775. See Exchange Rates below. The rate is rounded to 6dp for display. Full precision is used in calculation.

Note J4c:         The unrealised foreign exchange gain on interest income is analyzed as follows:

SGDRate+
USD
At Closing Rate8,000.620.577434
4,619.83
At Average Rate8,000.620.571775
4,574.56
Gain in exchange
45.27

+ Rates used for calculation are in full precision. Illustrated rates are rounded to 6dp.

Note J4e:         The unrealised gain on the revaluation of the deposit is analyzed as follows:

SGDRate+
USD
At Closing Rate1,000,000.000.577434
577,433.88
At Average Rate1,000,000.000.567456
567,456.38
Gain in exchange
9,977.50

+ Rates used for calculation are in full precision. Illustrated rates are rounded to 6dp.

J5                          Reversal Money Market Month End Accruals.

TradeIDPostDateB/PAccountCcyCcy AmountExc RateCcyBase AmountLine
MMK10011-Apr-03BDeposit - Interest RecvSGD-8,000.620.577434USD-4,619.83J5a
MMK10011-Apr-03PDeposit Interest IncomeSGD8,000.620.571775USD4,574.56J5b
MMK10011-Apr-03PFX - Unrealised Gains-RevenueSGD0.00USD45.27J5c
MMK10011-Apr-03BDepositSGD0.00USD-9,977.50J5d
MMK10011-Apr-03PFX - Unrealised Gains - CapitalSGD0.00USD9,977.50J5e

J6                          Money Market Deposit Maturity.

TradeIDPostDateB/PAccountCcyCcy AmountExc RateCcyBase AmountLine
MMK10013-Apr-03PDeposit Interest IncomeSGD-8,281.340.571524USD-4,732.99J6a
MMK10013-Apr-03BDepositSGD-1,000,000.000.567456USD-567,456.38J6b
MMK10013-Apr-03BCash at BankSGD1,008,281.340.581416USD586,230.53J6c
MMK10013-Apr-03PFX - Realised Gains-RevenueSGD0.00USD-81.91J6d
MMK10013-Apr-03PFX - Realised Gains - CapitalSGD0.00USD-13,959.25J6e

Note J6a:         The average multiplier rate between 3-Feb to 2-Apr is 0.571524. See Exchange Rates below. Note that the last day of the deposit is not included. The rate is rounded to 6dp for display. Full precision is used in calculation.

Note J6d:         The realised foreign exchange gain on interest income is analyzed as follows:

SGDRate+
USD
At Closing Rate8,281.340.581416
4,814.90
At Average Rate8,281.340.571524
4,732.99
Gain in exchange
81.91

+ Rates used for calculation are in full precision. Illustrated rates are rounded to 6dp.

Note J6e:         The realised gain on the deposit is analyzed as follows:

SGDRate+
USD
At Closing Rate1,000,000.000.581416
581,415.63
At Start Rate1,000,000.000.567456
567,456.38
Gain in exchange
13,959.25

+ Rates used for calculation are in full precision. Illustrated rates are rounded to 6dp.

EXCHANGE RATES

Our illustration assumes the company uses different daily exchange rates for accounting.

Average rates are computed by using the multiplier rate from trade/transaction currency to the base currency each day and averaging this over the relevant period.

The following rates were used for this illustration.

Spot rate

DateUSD/SGDSGD/USD*
3-Feb-031.7622500.567456
28-Feb-031.7577200.568919
31-Mar-031.7318000.577434
3-Apr-031.7199400.581416

Average

From DateTo DateSGD/USD*
3-Feb-0328-Feb-030.571584
3-Feb-0331-Mar-030.571775
3-Feb-032-Apr-030.571524

* round to 6 dp. Full precision used for calculation of average rates

FREQUENTLY ASKED QUESTIONS

RELATED INFORMATION

CHANGE HISTORY

DateByChanges
08-Apr-2004CSCreation.
06-Jun-2016RJReformatted.
08-Apr-2020LTRe-formatting.
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