3.1 Glossary of Oracle FLEXCUBE– Investor Servicing
Contents
1. Clearing Unit holders can pay for IPO subscriptions subscriptions through cash check demand draft credit card and transfer from their bank account With exception of cash transactions all the others have to be presented to the drawee bank and credit received by the fund This process of presentation and receiving credit through bank is referred to as clearing A related concept is that of allocation on par with cash Confirmation A process carried out by the fund manager to ratify redemption transactions and is mandatory for check printing in respect of redemption transactions to be enabled oe ORACLE Consolidation In a situation where the unit holder requests for units issued under separate certificates to be combined as certificates having a greater denomination a consolidation transaction is put through and units generated in the unit holder defined denominations Mainly corpo rate and FII investors are interested in these type of certificates where the denomination of the certificates are usually high In other words these are known as Jumbo Certificates This function is sup ported in a scrip based fund Corporate Actions The Corporate Actions screen can be used by the AMC to define the rules for corporate actions processing for the fund For the corpo rate action dividend you can define the frequency of payoffs price declaration as also other payment related areas such as lead times2. Unblock When the unit holder gets the pledged units released he is free to carry out all transactions pertaining to the units in that fund This free ing of pledged units is referred to as Unblock Unit holder Is an individual or a corporate that subscribes to the units of the fund on the basis of the information provided by the brokers by making an application to the agency branch attached to the fund The terms that follow are sought to be explained with the assistance of the following chart Fund Manager Finance 2000 AMC Barton Hill AMC Edward OakesAMC Industry Commemorative General Money Market AA FUND GC FUND IN FUND CN FUND SB FUND MM FUND Open Ended Close Ended Close Ended Open Ended Open Ended Close Ended Growth Income Income Growth Income Growth Growth Money Market Fund Portfolio Type In the figure given above the AMC s are defined as Finance 2000 AMC Barton Hill AMC and Edward Oakes AMC Fund Funds floated by an AMC may be classified as Open ended or Close Class ended funds i ORACLE Open An open ended fund makes an offering of its units to the public and has an Ended option to buyback redeem its units from the unit holder who wishes to liq Funds uidate his holdings at a given point of time Similarly unit holders are allowed e
3. Authorization Every time data pertaining to fund rules or transactions is entered in the system it has to be authorized so as to give effect to it An authorization is therefore the process of verification of the data entered as also sanctioning the same Presently the system sup ports authorization for the key processes like Funds Fund Rule Unit holders Brokers Transaction Amendment Transaction Processing Rules etc zin ORACLE Automatic clearing While the agency branch initiating a transaction can manually clear reject a check demand draft credit card transfer transaction on the basis of the advice from the drawee bank it is also possible for the fund manager to define a maximum period beyond which all pay ments which are pending clearing are cleared by the system and allocation of the same carried out This concept of payment status being system cleared is referred to as Automatic Clearing Block When a unit holder pledges units in favor of a corporate person or institution a lien is required to be marked on these units in favor of the recipient of the pledge This is called a block and the unit holder cannot redeem transfer or switch these units until the block is lifted through an unblock Board of Directors Meeting A meeting held to declare the results of the funds and the future strategies of the fund with respect to investments profit sharing with unit holders Dividend and bo
4. In the case of a scrip less fund having aging based on transaction receipts the unit holder can select the earlier transaction to which he would like the transaction aged and the units allotted would be reduced from that particular transaction only Transfer This process is normal in open and close ended funds where the unit holder sells his holdings to another unit holder or to a new unit holder The buyer gets the unit registered and the holding of the seller is reduced to the extent of the transfer Trustee An individual or group of persons overseeing the activities of the AMC with to safeguard the interests of the Unit holder 98 ORACLE When the unit holder gets the pledged units released he is free to Unblock carry out all transactions pertaining to the units in that fund This freeing of pledged units is referred to as Unblock An individual or a corporate that subscribes to the units of the fund Unit holder on the basis of the information provided by the brokers by making an application to the agency branch attached to the fund The terms that follow are sought to be explained with the assistance of the following chart Fund Manager Finance 2000 AMC Barton Hill AMC Edward OakesAMC Industry Commemorative General Money Market AA FUND GC FUND IN FUND CN FUND SB FUND MM FUN
5. agents agency branches trustees EOD The procedures that are undertaken to close out a logical day and pre pare the system for the next working day are collectively termed as EOD or End of Day Procedures They are menu driven as well as automated Export Import Processing Offline branches need to forward data to the fund manager on a daily basis and then receive the same back after it is processed Data is for warded to the fund manager by offline branches through the export process and received through the import process This exchange of data between the fund manager and the offline branches is referred to as export import processing FIFO In the case of a scrip less fund when the unit holder asks for any one of three transaction types redemption switch or transfer and the aging for that fund is based on FIFO the system would automatically put through the transaction taking into account the balances in earlier acquisition transactions starting with the unit holder s oldest transac tion in the fund and progressively going through to the last until the entire requirement of the transaction is met et ORACLE Floor Price The minimum price offered by the AMC for the units in a fund This would apply in the case of redemption payoffs and in the computation of loads for a transaction by a unit holder in a fund Floor Value Minimum value for a load which the fund manager may expe
6. and processing frequencies for statements for both cash and stock dividends For a fund a separate corporate action profile can be maintained for each dividend type stock and cash Custodian An entity which stores and keeps track of the physical securities per taining to the fund and applicable primarily in a scrip based sce nario Declared NAV A fund may opt to declare a price at a pre defined frequency This price is a function of the trading profits and losses of the fund and is arrived at based on the policies defined by the fund in advance This net figure which the fund may publicly announce is referred to as the declared NAV and is reckoned for the purposes of arriving at loads payoffs etc subject to the floor and cap applicable for the same Typ ically in a user scenario the declared NAV is determined by the fund manager through the use of an investment management tool such as Oracle FLEXCUBE Investor Servicing Asset Management or any other external mechanism from where the price is received and entered either manually or through a specifically designed interface A portion of profits that are divided among the unit holders according Dividend to their respective holdings at a pre defined frequency Entity An individual corporate or institution with which a fund interacts in the course of its daily activities At present the following entities are recognized in the system unit holders ass
7. are put through normal authorizations ii ORACLE 3 Appendix B Glossary This chapter contains the following section e Section 3 1 Glossary of Oracle FLEXCUBE Investor Servicing s ORACLE 3 1 Glossary of Oracle FLEXCUBE Investor Servicing Account Closure Carried out after the unit holder wishes to close his account with the fund A unit holder account would be considered closed only after all the units held by a unit holder in the fund are redeemed current block transactions are unblocked and any uncleared checks are cleared and given effect to Until such time that these processes are completed the account would be treated as Pending Closure Agency Branches The branch which caters to the needs of the unit holders on the basis of the geographical areas earmarked for their activities The agency branch helps the fund managers to generate more business for the fund besides acting as a contact point for unit holders who need not always approach the AMC directly for information required by them or for transactions Agent The organization entity entrusted with dealing directly with unit holders a function performed in turn by its Agency Branches Aging The process of keeping track of the age of a transaction from the date of its entry till the date of its being cleared in full from the account of a unit holder Two types of aging are supported within the system FIFO an
8. sharing with unit holders Dividend and book closing dates are announced and fund rules are amended if required with the directors approving such amendments BOD Also known as beginning of the next working day The system would be online again after the completion of BOD and the agency branches can do transaction entry Book Closing Having defined a freeze holdings date the fund may also specify a date or a pair of dates during which no new units would be issued to unit holders in the funds or like wise transferred to new unit holders effectively resulting in the register of unit holders being closed for the period specified This action of a fund is referred to as book closing and the period is the difference between the book closing from and to date s The unit holders whose names appear in the Registrars list on the book closing from date are eligible for dividends if announced Broker An individual or a corporate entrusted with the role of marketing the products offered by the fund At present multiple level hierarchy could be supported in the system Ceiling Value Loads Maximum value for a load which the fund manager may expect to pay or receive The system would recognize both floor and ceiling values for a transaction Check alloca tion On clear ing date In cases where the fund is defined as having check allocation on clearing date the transaction is allocated on the basis of the price pre
9. vailing on the date of clearing of the check Clearing Unit holders can pay for IPO subscriptions subscriptions through cash check demand draft credit card and transfer from their bank account With exception of cash transactions all the others have to be presented to the drawee bank and credit received by the fund This process of presentation and receiving credit through bank is referred to as clearing A related concept is that of allocation on par with cash Confirmation A process carried out by the fund manager to ratify redemption trans actions and is mandatory for check printing in respect of redemption transactions to be enabled zin ORACLE Consolidation In a situation where the unit holder requests for units issued under separate certificates to be combined as certificates having a greater denomination a consolidation transaction is put through and units generated in the unit holder defined denominations Mainly corporate and FII investors are interested in these type of certificates where the denomination of the certificates are usually high In other words these are known as Jumbo Certificates This function is supported in a scrip based fund Corporate Actions This screen can be used by the AMC to define the pattern for process ing corporate actions like dividend A fund can have a profile for each corporate action The frequency of payoffs price declaration as also other payme
10. Added Tax WAUC Weighted Average Unit Cost 1 8 Getting Help Online help is available for all tasks You can get help for any function by clicking the help icon provided or by pressing F1 T ORACLE 2 Appendix A Glossary This chapter contains the following section e Section 2 1 Glossary of Oracle FLEXCUBE Investor Servicing Terms ORACLE 2 1 Glossary of Oracle FLEXCUBE Investor Servicing Terms Account Clo sure Carried out after the unit holder wishes to close his account with the fund A unit holder account would be considered closed only after all the units held by a unit holder in the fund are redeemed current block transactions are unblocked and any un cleared checks are cleared and given effect to Until such time that these processes are com pleted the account would be treated as Pending Closure Agency Branch The branch which caters to the needs of the unit holders on the basis of the geographical areas earmarked for their activities The agency branch helps the fund managers to generate more business for the fund besides acting as a contact point for unit holders who need not always approach the AMC directly for information required by them or for transactions Agent The organization entity entrusted with dealing directly with unit hold ers a function performed in turn by its Agency Branches Aging The process of keeping track of the age of a transa
11. D Open Ended Close Ended Close Ended Open Ended Open Ended Close Ended Growth Income Income Growth Income Growth Growth Money Market Fund Portfolio Type In the figure given above the AMCs are defined as Finance 2000 AMC Barton Hill AMC and Edward Oakes AMC Fund Funds floated by an AMC may be classified as Open ended or Close Class ended funds o An open ended fund makes an offering of its units to the public and has pen Ended an option to buyback redeem its units from the unit holder who wishes Funds to liquidate his holdings at a given point of time Similarly unit holders are allowed entry at any time during the life of the fund A close ended fund issues its units upto a pre determined number Close through an initial public offering Once the units are issued they may be Ended redeemed only upon the closure of the fund Further unit holders also Funds have the option of switching their holdings upon closure of the fund to funds which are part of the same Fund Family Comprises of one or more funds and permits inter fund activity Fund families are defined by the AMC and a given fund can only belong to one fund family Industry Commemorative General and Money Market con By stitute the four fund families in the figure above amily Unit holders in GCFund may switch their holdings to AAFund upon clo sure of GCFund Similarly unit holders in INFund may switch their uni
12. Glossary User Guide Oracle FLEXCUBE Investor Servicing Release 12 1 0 0 0 Part Number E67272 01 October 2015 ORACLE Glossary User Guide October 2015 Oracle Financial Services Software Limited Oracle Park Off Western Express Highway Goregaon East Mumbai Maharashtra 400 063 India Worldwide Inquiries Phone 91 22 6718 3000 Fax 91 22 6718 3001 www oracle com financialservices Copyright 2007 2015 Oracle and or its affiliates All rights reserved Oracle and Java are registered trademarks of Oracle and or its affiliates Other names may be trademarks of their respective owners U S GOVERNMENT END USERS Oracle programs including any operating system integrated software any programs installed on the hardware and or documentation delivered to U S Government end users are commercial computer software pursuant to the applicable Federal Acquisition Regulation and agency specific supplemental regulations As such use duplication disclosure modification and adaptation of the programs including any operating system integrated software any programs installed on the hardware and or documentation shall be subject to license terms and license restrictions applicable to the programs No other rights are granted to the U S Government This software or hardware is developed for general use in a variety of information management applications It is not developed or intended for use in any inherently dangerous ap
13. NAV the stronger is the fund but for close ended funds the price is determined by the demand and supply factors in the sec ondary markets Online amp Offline branches Data in the system resides on the backend database that can be accessed by agency branches that are connected to it through leased lines or some other form of networking Branches that are so con nected to the server are referred to as online branches On the other hand there may be agency branches that are not con nected to the backend database These branches may have access to fewer services within the system Also these branches will have to send data to the fund manager and receive the processed data from the fund manager on a daily basis through export import processing Par Value Whenever a fund makes an initial public offering it would be required to specify the face value at which the units are being offered to pro spective investors This face value at which the units are being offered is referred to as the par value Post priced funds The fund manager may opt for price declaration for a fund after taking into account the transactions for the day This can only be done at close of a day s business hours and such a fund would be referred to as a post priced fund Pre EOD Also known as Pre End of Day Processing at the fund manager is the first step in the closing of books for the day Prior to taking up pre EOD the fund manag
14. ac tion can be amended once Authorization Every time data pertaining to fund rules or transactions is entered in the system it has to be authorized so as to give effect to it An author ization is therefore the process of verification of the data entered as also sanctioning the same Presently the system supports authoriza tion for the key processes like Funds Fund Rule Unit holders Bro kers Transaction Amendment Transaction Processing Rules etc iu ORACLE Automatic clearing While the agency branch initiating a transaction can manually clear reject a check demand draft credit card transfer transaction on the basis of the advice from the drawee bank it is also possible for the fund manager to define a maximum period beyond which all payments which are pending clearing are cleared by the system and allocation of the same carried out This concept of payment status being system cleared is referred to as Automatic Clearing Block When a unit holder pledges units in favor of a corporate person or institution a lien is required to be marked on these units in favor of the recipient of the pledge This is called a block and the unit holder can not redeem transfer or switch these units until the block is lifted through an Unblock Board of Direc tors Meeting A meeting held to declare the results of the funds and the future strate gies of the fund with respect to investments profit
15. ayoff check Such a confirmation for the transaction can only be done after the expiry of the number of days of lag Letter of Intent A type of instruction given by a client to the fund manager to buy sell redeem at a particular date or rate specified by the unit holder It is a commitment by the unit holder to invest a specified amount within a specified time period Load to Price In the event of a load being defined as a percentage of a transaction amount the fund manager may prefer to let the effect of such a load reflect on the price applicable to the transaction This practice of increasing or decreasing the price for a transaction is referred to as loading to price s ORACLE Loads Fees charged from or incentives paid to the parties that the fund interacts with during the course of its daily operations These may be defined as a percentage or as a straight amount depending on pre defined slabs Name Change Carried out when a unit holder wants to change his her name as appearing in the list of members for that fund The fund manager effects a name change only after authorization It is also essential for the name change to be accepted by the Registrar to become effec tive NAV or Net Asset Value The price of the fund units is determined by this method This calcu lation is appropriate for the open ended funds because they are sold to the owners of the fund and traded at n
16. ayoffs credits debits and transfers for the transactions Such reports are referred to as Summary reports There is also a sep arate menu option available to the fund manager for the generation of such reports Switch An option where a unit holder could move investments from one fund to any other fund belonging to the same fund family It should be noted that unit holders cannot switch from one fund family to another Transaction base price In defining a fund the fund manager may specify the transaction types that are available to the unit holders in the fund At the same time the fund may also specify the price that would be applicable to that trans action type At present the values supported for this would be Par Value Declared NAV and ROI Value Transaction receipts In the case of a scrip less fund having aging based on transaction receipts the unit holder can select the earlier transaction to which he would like the transaction aged and the units allotted would be reduced from that particular transaction only Transfer This process is normal in open and close ended funds where the unit holder sells his holdings to another unit holder or to a new unit holder The buyer gets the unit registered and the holding of the seller is reduced to the extent of the transfer Trustee An individual or group of persons overseeing the activities of the AMC with to safeguard the interests of the Unit holder
17. ct to pay Loads or receive Freeze Hold When dividends are declared by a fund it would like to payoff these ings dividends to unit holders on the basis of their holdings as of a particu lar date The holdings as of this date are eligible for the computation of dividend Information Carried out whenever the unit holder wants to change information Change related to his address telephone number identification details joint holders etc IPO Initial public offering is done by the fund manager to garner subscrip tions when a new fund is floated This operation is typically a primary market operation that involves broker agent and its agency branch that helps the fund manager to get maximum funds from the investors while starting the fund Lags A lag can be defined as the lead time which would be applicable to a particular transaction in respect of a Price When a price lag is defined for a transaction type it means that the price applicable for the transaction would be the price declared on a date that is the transaction date minus the number of days of lag b Allocation When an allocation lag is defined the allocation of the transaction may take place only after the expiry of the number of days of lag from the date of the transaction C Confirmation For redemption transactions a confirmation is required to enable printing of the payoff check Such a confirmation for the transaction can only be done after the expiry
18. ction from the date of its entry till the date of its being cleared in full from the account of a unit holder Two types of aging are supported within the system FIFO and Transaction Receipts Allocation on par with cash The fund manager has the option of waiting for payments made through modes other than cash to be cleared before effecting alloca tion Conversely the fund manager may opt to provisionally allot the units on receipt of the application pending clearance of the payment in the case of check credit card and transfers This option of provisional allotment pending clearing can be enabled using the allocation on par with cash option It follows that when allocation on par with cash is defined as NO the units will be allocated only after the payment is cleared manually or through automatic clearing Allocation The process of creation liquidation of units after a transaction net of all loads is referred to as allocation Amendment Transactions may be amended at the agency branch level on the request of the unit holder to give effect to corrections pertaining to spe cific transactions Fund rules can also be amended at the fund man ager level on the basis of a decision made by the trustees or the board of directors Presently any transaction can be amended once while in the case of fund rule amendment the fund manager has an option to amend it to the funds necessity Presently in the system any trans
19. d Transaction Receipts Allocation on par with cash Allocation on par with cash is maintained in Fund Rules General Operating Rules The fund manager has the option of waiting for payments made through modes other than cash to be cleared before effecting allocation Conversely the fund manager may opt to provi sionally allot the units on receipt of the application pending clear ance of the payment in the case of check credit card and transfers This option of provisional allotment pending clearing can be enabled using the allocation on par with cash option It follows that when allocation on par with cash is defined as NO the units will be allo cated only after the payment is cleared manually or through auto matic clearing Allocation The process of creation liquidation of units after a transaction net of all loads is referred to as allocation Amendment Transactions may be amended at the agency branch level on the request of the unit holder to give effect to corrections pertaining to specific transactions Fund rules can also be amended at the fund manager level on the basis of a decision made by the trustees or the board of directors Presently any transaction can be amended as many times as required while in the case of fund rule amendment the fund manager has an option to amend it to the funds necessity Presently in the system any transactions can be amended as many times as required
20. e Loads Minimum value for a load which the fund manager may expect to pay or receive Freeze Holdings When dividends are declared by a fund it would like to payoff these dividends to unit holders on the basis of their holdings as of a par ticular date The holdings as of this date are eligible for the computa tion of dividend Information Change Carried out whenever the unit holder wants to change information related to his address telephone number identification details joint holders etc IPO Initial public offering is done by the fund manager to garner subscrip tions when a new fund is floated This operation is typically a primary market operation that involves broker agent and its agency branch that helps the fund manager to get maximum funds from the inves tors while starting the fund Lags A lag can be defined as the lead time which would be applicable to a particular transaction in respect of a Price When a price lag is defined for a transaction type it means that the price applicable for the transaction would be the price declared on a date that is the transaction date minus the number of days of lag b Allocation When an allocation lag is defined the allocation of the transaction may take place only after the expiry of the number of days of lag from the date of the transaction C Confirmation For redemption transactions a confirmation is required to enable printing of the p
21. er may request the fund manager to put through the same on his behalf at pre defined intervals Such requests are referred to as Standing Instructions Subscriptions Investments made by investors in a specified period falling outside the IPO period In a close ended fund subscriptions are limited to the required corpus of the fund Summary reports As part of EOD processing every day the system generates a report for each transaction type in each fund giving the details of the loads applicable and applied for the transactions the unit holder names along with advices to the registrar accounting section and the trus tees regarding payoffs credits debits and transfers for the transac tions Such reports are referred to as Summary reports There is also a separate menu option available to the fund manager for the generation of such reports Switch An option where a unit holder could move investments from one fund to any other fund belonging to the same fund family It should be noted that unit holders cannot switch from one fund family to another Transaction base price In defining a fund the fund manager may specify the transaction types that are available to the unit holders in the fund At the same time the fund may also specify the price that would be applicable to that transaction type At present the values supported for this would be Par Value Declared NAV and Rol Value Transaction receipts
22. er has to ensure that all the agency branches are signed off fund prices are entered for the day for all the funds as per pre defined frequency The system displays a list of activities that are classified as mandatory or optional and the user has to ensure that the same are completed before taking up pre EOD processing at fund manager This is followed by EOD Pre priced funds A pre priced fund is one in which the last available price declared would be applicable for transactions which would be the price declared the day before the transaction date where price declaration frequency is daily The system presently requires that the frequency of price declaration for a post priced fund necessarily be daily whereas a pre priced fund can have daily weekly monthly half yearly yearly frequencies of price declaration Redemption Transactions An option given in the open ended funds where the fund may buy back units from unit holders either on the closure of the fund or at pre defined intervals Rules of the redemption are fund specific Redemption would result in reducing the outstanding units in the fund ee ORACLE Registered Capital The product of the total outstanding units in a fund by the price of issue Reinvestment In addition to the returns earned by them on initial investment made unit holders may also opt to increase their returns by putting their earn ings back in the same fund or
23. et asset value The formula of NAV is as follows NAV Value of the fund portfolio funds cash awaiting investments Expenses Number of Units Outstanding The higher the NAV the stronger is the fund but for close ended funds the price is determined by the demand and supply factors in the secondary markets Online amp Offline branches Data in the system resides on the backend database that can be accessed by agency branches that are connected to it through leased lines or some other form of networking Branches that are so connected to the server are referred to as online branches On the other hand there may be agency branches that are not con nected to the backend database These branches may have access to fewer services within the system Also these branches will have to send data to the fund manager and receive the processed data from the fund manager on a daily basis through export import process ing Par Value Whenever a fund makes an initial public offering it would be required to specify the face value at which the units are being offered to prospective investors This face value at which the units are being offered is referred to as the par value Post priced funds The fund manager may opt for price declaration for a fund after tak ing into account the transactions for the day This can only be done at close of a day s business hours and such a fund would be referred to as a post priced f
24. et management compa nies AMCs registrars brokers agents agency branches trustees The procedures that are undertaken to close out a logical day and EoD prepare the system for the next working day are collectively termed as EoD or End of Day Procedures They are menu driven or auto matically processed Offline branches need to forward data to the fund manager on a daily Export basis and then receive the same back after it is processed Data is forwarded to the fund manager by offline branches through the Import s export process and received through the import process This Processing exchange of data between the fund manager and the offline branches is referred to as export import processing oe ORACLE FIFO In the case of a scrip less fund when the unit holder asks for any one of three transaction types redemption switch or transfer and the aging for that fund is based on FIFO the system would automat ically put through the transaction taking into account the balances in earlier acquisition transactions starting with the unit holder s oldest transaction in the fund and progressively going through to the last until the entire requirement of the transaction is met Floor Price The minimum price offered by the AMC for the units in a fund This would apply in the case of redemption payoffs and in the computa tion of loads for a transaction by a unit holder in a fund Floor Valu
25. ill not be responsible for any loss costs or damages incurred due to your access to or use of third party content products or services Table of Contents About This Manual 45h accieeicaac kou lenius xa Fea FauE sec Eh MIna eoe Ioa ren CE 1 1 T21o Cntroductlori iier et eden eite er eese te dites ere ette dee thee on 1 1 1 2 Related Document le ee dede efe eee IRR eee ed 1 1 Eo Audiences E a Dea teile 1 1 T54 c Organizations team cetbveptio ues dtt stevens eee 1 1 1 5 Conventions Used in this Manual ssssssssssseeeeneneeeene nnns 1 1 1 5 1 General Conventions sss esee eene enne 1 2 1 5 2 Keyboard Conventions sisse seinen enne nnne 1 2 Le Glossary of CONS 7 def ada erdt deae erra xatd anb p uvae baee daa 1 2 1 7 Abbreviations and Acronyms ssssssssssssseeeeenene nennen nnne ener nnne 1 2 1 9 Getting Hlelp eee ettet pa edet ette es 1 3 Appendix A Glossary 5 ois cien udis ra Loa eic LU rao no UR DEDEC EYE RUAR Oo RECERARA Roda UE Ue 2 1 2 1 Glossary of Oracle FLEXCUBE Investor Servicing Terms sssesssss 2 2 Appendix B GlOSSary 1 5 itor ia s trq ck road Yoko raw Os cud dala a aiu dan 3 1 3 1 Glossary of Oracle FLEXCUBE Investor Servicing sse 3 2 1 1 1 2 1 3 1 4 1 5 1 About This Manual Introduction Welcome to Oracle FLEXCUBE Investor Servicing a comprehensive mutual f
26. in other funds which would increase their holding in the fund where such returns are re deployed This pro cess of re deploying returns for earning incremental returns is referred to as reinvestment Currently in the system reinvestment option is extended to the brokers and the unit holders Reissue If a certificate is destroyed or misplaced the fund manager can reis sue the misplaced certificates as duplicates after a formal announce ment This is applicable to scrip based funds Rejection Just as a transaction is authorized it can also be rejected by the fund manager using the discretion provided in the prospectus resulting in the transaction being disallowed Rule Effective date This is one of the most frequently occurring terms in the system Whenever a new rule is defined within the system the user would be required to specify a rule effective date for the same this would be accepted by the system and the new rule would become current from the rule effective date that the user defines In other words rule effec tive date is that date from which a new fund related rule defined would become current Scrip based funds Funds which issue certificates to unit holders for their holdings in a fund Consequently every transaction by a unit holder in a scrip based fund involves certificates being exchanged Scrip less funds Funds which do not issue certificates to unit holders The balances held by the uni
27. nt related areas such as lead times and processing fre quencies for statements for each corporate action type can be cap tured in the profile Custodian An entity which stores and keeps track of the physical securities per taining to the fund and applicable primarily in a scrip based scenario Declared NAV A fund may opt to declare a price at a pre defined frequency This price is a function of the trading profits and losses of the fund and is arrived at based on the policies defined by the fund in advance This net figure which the fund may publicly announce is referred to as the declared NAV and is reckoned for the purposes of arriving at loads payoffs etc subject to the floor and cap applicable for the same Typi cally in a user scenario the declared NAV is determined by the fund manager through the use of an investment management tool such as FLEXCUBE Investor Services Asset Management or any other exter nal mechanism from where the price is received and entered either manually or through a specifically designed interface Dividend A portion of profits that are divided among the unit holders according to their respective holdings at a pre defined frequency Entity An individual corporate or institution with which a fund interacts in the course of its daily activities At present the following entities are recog nized in the system unit holders asset management companies AMC s registrars brokers
28. ntry at any time during the life of the fund Close A close ended fund issues its units up to a pre determined number Ended through an initial public offering Once the units are issued they may be Funds redeemed only upon the closure of the fund Further unit holders also have the option of switching their holdings upon closure of the fund to funds which are part of the same Fund Family Fund Fam Comprises of one or more funds and permits inter fund activity Fund fam ily ilies are defined by the AMC and a given fund can only belong to one fund family Industry Commemorative General and Money Market constitute the four fund families in the figure above Unit holders in GCFund may switch their holdings to AAFund upon closure of GCFund Similarly unit holders in INFund may switch their units into CNFund on closure of their fund Fund Type An AMC may define in advance the type of funds that it would float In the figure above three fund types are defined Income Growth and Income cum Growth Earnings This is the income on a per unit basis from a fund which the Fund Man Per Unit ager proposes to distribute for eligible investors holding balances in the EPU fund Bulk Import The generic facility to import all transactions IPO and subscription and client details into FLEXCUBE Investor Services The transactions could be imported as authorized and unauthorized transactions where the unau thorized ones
29. of the number of days of lag Letter of Intent A type of instruction given by a client to the fund manager to buy sell redeem at a particular date or rate specified by the unit holder It is a commitment by the unit holder to invest a specified amount within a specified time period Load to Price In the event of a load being defined as a percentage of a transaction amount the fund manager may prefer to let the effect of such a load reflect on the price applicable to the transaction This practice of increasing or decreasing the price for a transaction is referred to as loading to price Loads Fees charged from or incentives paid to the parties that the fund inter acts with during the course of its daily operations These may be defined as a percentage or as a straight amount depending on pre defined slabs Name Change Carried out when a unit holder wants to change his her name as appearing in the list of members for that fund The fund manager effects a name change only after authorization zi ORACLE NAV or Net Asset Value The price of the fund units is determined by this method This calcula tion is appropriate for the open ended funds because they are sold to the owners of the fund and traded at net asset value The formula of NAV is as follows NAV Value of the fund portfolio funds cash awaiting investments Expenses Number of Units Outstanding The higher the
30. ok closing dates are announced and fund rules are amended if required with the directors approving such amendments BOD Also known as beginning of the next working day The system would be online again after the completion of BOD and the agency branches can do transaction entry Book Closing Having defined a freeze holdings date the fund may also specify a date or a pair of dates during which no new units would be issued to unit holders in the funds or like wise transferred to new unit holders effectively resulting in the register of unit holders being closed for the period specified This action of a fund is referred to as book closing and the period is the difference between the book closing from and to date s The unit holders whose names appear in the Registrars list on the book closing from date are eligible for dividends if announced Broker An individual or a corporate entrusted with the role of marketing the products offered by the fund At present multiple level hierarchies could be supported in the system Ceiling Value Loads Maximum value for a load which the fund manager may expect to pay or receive The system would recognize both floor and ceiling values for a transaction Check allocation On clearing date In cases where the fund is defined as having check allocation on clearing date the transaction is allocated on the basis of the price prevailing on the date of clearing of the check
31. plications including applications that may create a risk of personal injury If you use this software or hardware in dangerous applications then you shall be responsible to take all appropriate failsafe backup redundancy and other measures to ensure its safe use Oracle Corporation and its affiliates disclaim any liability for any damages caused by use of this software or hardware in dangerous applications This software and related documentation are provided under a license agreement containing restrictions on use and disclosure and are protected by intellectual property laws Except as expressly permitted in your license agreement or allowed by law you may not use copy reproduce translate broadcast modify license transmit distribute exhibit perform publish or display any part in any form or by any means Reverse engineering disassembly or decompilation of this software unless required by law for interoperability is prohibited The information contained herein is subject to change without notice and is not warranted to be error free If you find any errors please report them to us in writing This software or hardware and documentation may provide access to or information on content products and services from third parties Oracle Corporation and its affiliates are not responsible for and expressly disclaim all warranties of any kind with respect to third party content products and services Oracle Corporation and its affiliates w
32. t holders in these funds are tracked either through pass books or periodically generated account statements Certificates can be printed in the case of scrip less funds for block transactions of unit holders Sign off Sign off is a mandatory requirement for the fund manager to take up pre EOD processing By signing off a branch the fund manager ensures that all the data pertaining to the agency branch has been accepted by the fund manager while also ensuring that no further transaction entry can be done by the agency branches until completion of EOD processing Split A reverse of a consolidation whereby unit holder can reduce the certif icate denominations Standing Instructions Instead of having to repeat a transaction periodically the unit holder may request the fund manager to put through the same on his behalf at pre defined intervals Such requests are referred to as Standing Instructions Subscriptions Investments made by investors in a specified period falling outside the IPO period In a close ended fund subscriptions are limited to the required corpus of the fund e ORACLE Summary reports As part of EOD processing every day the system generates a report for each transaction type in each fund giving the details of the loads applicable and applied for the transactions the unit holder names along with advices to the registrar accounting section and the trustees regarding p
33. tion Keys All keys of the keyboard are represented in capital letters For example lt CTRL gt Shortcut All short cut keys are contained in brackets For example keys lt ALT SHIFT gt 1 6 Glossary of Icons This User Manual may refer to all or some of the following icons Icons Function Ea Exit 4 Add Row E Delete Row z Option List 1 7 Abbreviations and Acronyms The following acronyms and abbreviations are adhered to in this User Manual Abbreviation Meaning Acronym ADMIN User Administrator AGY The Agency Branch component of the system AMC Asset Management Company BOD Beginning of Day CDSC Contingent Deferred Sales Charge CGT Capital Gains Tax T ORACLE Abbreviation Meaning Acronym CIF Customer Information File EOD End of Day EPU Earnings per unit FC IS Oracle FLEXCUBE Investor Servicing FMG The Fund Manager component of the system FPADMIN Oracle FLEXCUBE Administrator ID Identification IHPP Inflation Hedged Pension Plan IPO Initial Public Offering LEP Life and Endowment Products LOI Letter of Intent NAV Net Asset Value REG The Registrar component of the system ROA Rights of Accumulation ROI Return on Investment SI Standing Instructions SMS Security Management System URL Uniform Resource Locator VAT Value
34. tity which records all the unit holder related details including name and address transactions history of dealings with the AMC besides performing the role of monitoring and collating IPO subscrip Registrar tion and subscription details and giving effect to redemption payoffs switch transactions transfers between unit holders unit holder account closures etc Also responsible for answering unit holder queries and redress of unit holder grievances Reinvestment In addition to the returns earned by them on initial investment made unit holders may also opt to increase their returns by putting their earnings back in the same fund or in other funds which would increase their holding in the fund where such returns are re deployed This process of re deploying returns for earning incremen tal returns is referred to as reinvestment Currently in the system reinvestment option is extended to the brokers and the unit holders If a certificate is destroyed or misplaced the fund manager can reis Reissue sue the misplaced certificates as duplicates after a formal announce ment This is applicable to scrip based funds Just as a transaction is authorized it can also be rejected by the Rejection fund manager using the discretion provided in the prospectus result ing in the transaction being disallowed Rule Effective date This is one of the most frequently occurring terms in the system Whenever a new rule is defined
35. ts into CNFund on closure of their fund An AMC may define in advance the type of funds that it would float In the Fund Type figure above three fund types are defined Income Growth and Income cum Growth Earnings This is the income on a per unit basis from a fund which the Fund Man Per Unit ager proposes to distribute for eligible investors holding balances in the EPU fund The generic facility to import all transactions and client details into Oracle FLEXCUBE Investor Servicing The transactions could be imported as Bulk Import authorized and unauthorized transactions where the unauthorized ones are put through normal authorizations ORACLE 3 10 ORACLE
36. und Pre EOD Also known as Pre End of Day Processing at the fund manager is the first step in the closing of books for the day Prior to taking up pre EOD the fund manager has to ensure that all the agency branches are signed off fund prices are entered for the day for all the funds as per pre defined frequency The system displays a list of activities that are classified as mandatory or optional and the user has to ensure that the same are completed before taking up pre EOD processing at fund manager This is followed by EOD ae ORACLE Pre priced funds A pre priced fund is one in which the last available price declared would be applicable for transactions which would be the price declared the day before the transaction date where price declaration frequency is daily Note The system presently requires that the frequency of price dec laration for a post priced fund necessarily be daily whereas a pre priced fund can have daily weekly monthly half yearly yearly fre quencies of price declaration Redemption Transactions An option given in the open ended funds where the fund may buy back units from unit holders either on the closure of the fund or at pre defined intervals Rules of the redemption are fund specific Redemption would result in reducing the outstanding units in the fund Registered The product of the total outstanding units in a fund by the price of Capital Issue An en
37. unds automation software from Oracle Financial Servicing Software Ltd This Oracle FLEXCUBE Investor Servicing User Manual helps you use the system to achieve optimum automation of all your mutual fund investor Servicing processes It contains guidelines for specific tasks descriptions of various features and processes in the system and general information Related Documents The User Manual is organized in to various parts each discussing a component of the Oracle FLEXCUBE Investor Servicing system Audience This Fund Manager User Manual is intended for the Fund Administrator users and system operators in the AMC Organization This volume of the Fund Manager User manual is organized under the following chapter sequence About This Manual explains the structure audience organization and Chapter 1 related documents of this manual Chapter 2 Ahi Glossary lists Glossary of Oracle FLEXCUBE Investor Servic Conventions Used in this Manual Before you begin using this User Manual it is important to understand the typographical conventions used in it ri ORACLE 1 5 1 General Conventions Convention Type of Information Italic type Functional foreign terms Validations for fields on a screen References to related Headings Users Manuals For emphasis Numbered Step by step procedures Bullet 1 5 2 Keyboard Conventions Convention Type of Informa
38. within the system the user would be required to specify a rule effective date for the same this would be accepted by the system and the new rule would become current from the rule effective date that the user defines In other words rule effective date is that date from which a new fund related rule defined would become current Scrip based funds Funds that issue certificates to unit holders for their holdings in a fund Consequently every transaction by a unit holder in a scrip based fund involves certificates being exchanged er ORACLE Scrip less funds Funds that do not issue certificates to unit holders The balances held by the unit holders in these funds are tracked either through passbooks or periodically generated account statements Certifi cates can be printed in the case of scrip less funds for block transac tions of unit holders Sign off Sign off is a mandatory requirement for the fund manager to take up pre EOD processing By signing off a branch the fund manager ensures that all the data pertaining to the agency branch has been accepted by the fund manager while also ensuring that no further transaction entry can be done by the agency branches until comple tion of EOD processing Split A reverse of a consolidation whereby unit holder can reduce the certificate denominations Standing Instructions Instead of having to repeat a transaction periodically the unit hold
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