Income Interest Allocation

The purpose of the Income Interest Allocation RC is to allocate interest income to the Funds that participate in Pooled Cash. There are few schools of thought when allocating interest Income. The two main philosophies are to allocate Interest Income to only those funds with a positive Cash balance and the other is to allocate interest to those accounts with a positive balance and charge interest to those accounts with a negative balance. This example will focus on only allocating interest income to those accounts with a positive cash balance.

The interest income calculation is broken down into a few pieces.

1. Gather the interest Income that needs to be allocated.
2. Calculate average daily balance for all accounts that participate in Pooled Cash.
3. Separate the accounts that do not have a positive average daily balance.
4. Generate the total of all accounts that have a positive average daily balance.

Main Tab Setup

The RC is set up with the category GLTRNS_GL. Since all of the data needed is contained with the GLT_TRNS_DTL, this category with the links it has to the GLK-KEY_MSTR and the GLO_OBJ_MSTR are sifficient.

Data Items

Step 1 – Gather Interest Income to Allocate

In order to gather the interest income that needs to be allocated out, we will consider all of the posting to object code that hold interest income from the beginning of the fiscal year (FYB) through the month end (MOE) that we are allocating. Since we are looking at transactions starting at the beginning of the year we will also need to net this amount against any prior distributions in the current year. The reason we are looking at transaction since the FYB is in case a transaction was posted to a prior period after the allocation of that period was already performed.

Step 2 – Calc ADGBAL for All Accounts That Participate in Pooled Cash

This step's filter selects all the accounts that have a balance in the Claim on Cash Account.

The first calculation in the step is for generating the Average Daily balance for the month that we are allocating. In the calculation we see that we are using the AVGBAL function with the parameter that identifies it as a Monthly:

AVGBAL(M,CREDIT,DEBIT)

The process is to determine which accounts have a positive Average daily balance as that was determined at the beginning of the process that we would exclude those accounts that have a negative balance:

CASHBAL.AVGCASH > 0

Now that we have only the accounts that have a positive average daily balance we need to summarize those amounts. This will give us the denominator in the calculation to determine the percentage that each of the funds gets of the income being allocated. When we do this calculation, this item needs to be set up as a Global variable. That will allow us to use the results of this calculation with any row that is being processed in the RC:

SUM(CASHBAL.POSCASHBAL)