Calculate NAV with income distribution

The formula sums values from bookkeeping accounts defined in the fund settings. The formula sums up postings with status Ready since the beginning of the year.

As Income Distribution calculation is base on bookkeeping postings it is important that all bookkeeping is up to date when you calculate NAV. This means that you need to run Deferral processes that have impact on Income Distribution before you run NAV. Normally this is the following deferral processes, set up with FAFUNDS configuration name, and with process UI disabled:

When previewing NAV you see the Income Distribution in bottom part of the NAV Summary tab as Accrued net income.

The number shown is ingoing Accrued net income from previous NAV date (Stored in Income Distribution Transactions per that date) + summed up Amounts in Ready Bookkeeping postings since beginning of year on mapped accounts + New fees in this NAV calculation.

Each periods calculated Income distribution is recorded in Income distribution transactions towards the “ID” accounts. Transactions like below are created in NAV run. Note that detailed breakdown from this NAV calculations Income is stored in Description on statement field. Internal info field also holds same information in format read by NAV process in next run.

You can see balances in these accounts in Overview, it is excluded from Portfolio valuation.

Recording Income Distribution per Unit

NAV calculation records the income per unit in the accrual and close 5 market data fields of each of the fund securities.

NAV process creates cash transactions to Fund portfolios based on aggregated flows from Subscriptions and Redemptions. They are aggregated per Transaction type and Settlement date in Client orders.

Transaction types used are the ones defined in Fund settings tab - Automatic order execution. Our recommended is Deposit - Fund (FMDEP) and Withdrawal - Fund (FMWD).

The Trade Amount is broken down in 3 parts:

(If Swing pricing is applied the total value of the Swing is also specified)

Implication in Bookkeeping export from Income Distribution processing

When NAV is run with Income Distribution, normal is that all bookkeeping postings up to the NAV run is set to status Reported. This is normally not in sync with what actually is reported to bookkeeping system.

Reason for this is that Income Distribution calculation requires that already included transactions are flagged Reported, i.e. for next NAV only bookkeeping with status Ready will be included in Income Distribution calculation.

To manage the not in sync Reported mark from NAV processing extension Bookkeeping reporting (from version 3.4) supports to only include postings with ext_id larger than latest reported.