Preference - Bookkeeping
Bookkeeping preferences include settings for managing and setting up accounting. The first steps in setting up accounting are to 1) create bookkeeping accounts in the system through the Account set preferences and 2) create appropriate posting rules in the Posting rule preferences.
Changes in bookkeeping preferences are tracked:
Changes in account sets and posting rules are recorded in FA audit logs available in the FA Admin Console: Changes in system settings.
Changes in posting rules are recorded in versions of each posting rule: Track data modifications through versions.
Account set
In the Account set preferences, you can define account sets to be used when defining posting rules. An account set consists of a code, account set name, and individual accounts. Define an account number and name for each account.
You can add the accounts manually one by one or click Import/export and then copy and paste the accounts on separate lines as text.
You can also fetch the account name and number dynamically from the account information of a portfolio or reported transaction's security:
Typing SEC into the account number uses the transaction's security name as the account name and the transaction's security trade code as the account number.
Typing ACC into the account number uses the transaction's portfolio's secondary account number as the account code, or if not defined, the currency trade code of the portfolio account as the account code.
General
In the General preferences, you can define the logic used to create bookkeeping postings from transactions. The following table lists the configurations available:
Preference | Description |
|---|---|
Posting generation | |
Choose the action on transaction saving | Option to choose if postings are generated on transaction save:
|
Generate zero-amount postings | Option to generate postings when the posting amount is zero. |
Tag for transactions that generate no postings | Tag to apply to transactions to skip the generation of postings. |
Posting rules | |
Generate postings in the portfolio currency | Option to use only specific posting rules to generate postings in the portfolio currency. By default, all posting rules are applied to generate postings. This option is selected by default. If you don't want to generate postings in the portfolio currency, either select to generate them in the security currency or the account currency instead. |
Posting rule codes to generate postings in the portfolio currency | Posting rules to generate postings in the portfolio currency. Applied to all if empty. Specify the posting rule codes as a comma-separated list. You also need to add the rules to the portfolio in the Portfolio window, Posting rule field. |
Generate postings in the security currency | Option to generate some postings in the security currency. |
Posting rule codes to generate postings in the security currency | Posting rules to generate postings in the security currency. Applied to all if empty. Specify the posting rule codes as a comma-separated list. You also need to add the rules to the portfolio in the Portfolio window, Posting rule field. |
Generate postings in the account currency | Option to generate some postings in the currency of the security related to the transaction. Only unique currency postings are generated. |
Posting rule codes to generate postings in the account currency | Posting rules to generate postings in the account currency. Applied to all if empty. Specify the posting rule codes as a comma-separated list. You also need to add the rules to the portfolio in the Portfolio window, Posting rule field. |
Currency codes to generate postings in other currencies | Currencies other than the account currency in which postings should be generated. Specify the currency codes as a comma-separated list. |
Posting rule codes to generate postings in other currencies | Posting rules to generate postings in other currencies. Applied to all if empty. Specify the posting rule codes as a comma-separated list. You also need to add the rules to the portfolio in the Portfolio window, Posting rule field. |
Use currency posting rules for security-based transactions with accounts not in the portfolio currency | Option to generate separate postings for currency exchange if the security sell or buy is made against an account with a currency different from the portfolio currency. If you enable this option, create posting rules against the currency security type with transaction types buy and sell. |
Security type codes that get the purchase value from the cash account purchase price (default: “CASH, FUTCF”) | Securities that take the purchase value from the average purchase price of cash in the booked account. This setting is needed if the purchase value and profit are to be booked on cash-type transactions. By default, this is cash (CASH) and future cashflows (FUTCF). Specify the security codes as a comma-separated list. |
Posting amount | |
Use book values for calculating FX profit and loss | Option to use the book FX values in currency profit and loss calculation. |
Apply rounding before calculating the posting amount | Option to round posting charge amounts individually before the total amount is saved for the posting. If you disable this option, rounding is applied to the total posting amount. |
Disable the netting of postings | Option to disable the netting of postings. Netting means that if a transaction generates multiple postings against the same bookkeeping account for the same date, they are summed up and only one posting is saved. If you disable this option, each posting rule generates a separate posting. As a result, a single transaction can have multiple postings against the same account on the same day. |
Bookkeeping accounts | |
Bookkeeping account numbers per currency to use ACC account postings if the portfolio secondary account number is undefined (for example “SEK=1921,EUR=1922”) | Bookkeeping account numbers per currency to use ACC account postings if the portfolio secondary account number is undefined. Format: “Currency code=Account number”. For example, “SEK=1921,EUR=1922”. |
Use these accounts also when the bookkeeping account code is ACC and the portfolio’s secondary account number is defined | Option to always use the specified account numbers for ACC accounts, even if the portfolio secondary account number is defined. |
Posting rule
In the Posting rule preferences, you can define different rules that affect the formation of the bookkeeping report or the generation of postings (if bookkeeping is enabled). These rules describe, which transactions, linked to a security with certain characteristics, are recorded to the debit and credit sides of the chosen bookkeeping account.
A posting rule consists of a name, a code, and a link to a defined account set. The link to an account set defines the accounts available for defining the posting rules: only the accounts defined for the linked account set are available.
In addition to the basic information, a posting rule consists of multiple precise rules, which are defined against a certain bookkeeping account: the whole posting rule is a combination of several, individual rules, each representing an entry in bookkeeping. A new individual rule to the posting rule is added with the Add button at the bottom of the window.
When posting-based bookkeeping is enabled, you can see an extended set of selectable rules and charge types compared to the available fields in standard bookkeeping. When bookkeeping is not enabled, you can only see the standard options. In addition, you can search for posting rules by filtering a posting rule set with the content of the available columns.
An individual rule is defined as a combination of a certain transaction type, security's characteristics, account from the chosen account set, and decision of debit/credit. The following fields are available (fields marked with * are required):
- Transaction type*
Choose the transaction type of the posting rule, e.g. which types of transaction the individual rule is applied to.
- Security
Choose the characteristics of the securities to apply the rule to. You can choose from:
Security base type, Security type, Security subtype, or individual Security. You can select only one of these properties.
Country, Marketplace, Class (1 through 5), or Issuer. You can select one or more of these properties.
If you have multiple rules, specific rules are applied over more generic ones. The security characteristics are taken into account in bottom-up order. For example, if you have separate rules for security country "Finland" and security type "Stock", the rule based on the security country is applied for your Finnish stocks (the country is below the security type in the list).
- Account*
Choose the bookkeeping account the entry is recorded to from the account set linked to the posting rule (the accounts are defined in the Account set preferences for the linked account set)
- Value
Leave empty, or choose from positive or negative. For each individual rule, you can define that the individual rule is executed and a posting is generated only if the value of the rule will be positive or negative. You can thus define that even if other rule criteria are met, only execute the individual rule if the positive/negative value criteria are met.
- Charge type
Choose the charge type(s) of the rule by choosing them from the check boxes next to the type (the types available are described in the table below). Checking a charge type also allows you to combine different values by adding or subtracting them: when checking multiple types, these values are added up, and the + and - signs above the check boxes determine whether the checked value is taken into the calculation as positive or negative, e.g. added or subtracted in the calculation.
- Posting date
Choose from Transaction date or Settlement date. Decides whether the posting date of the created posting is set based on the transaction date or settlement date of the transaction the posting is created through.
- Payment*
Choose from debit or credit. Determines whether the individual rule will be recorded to the debit or credit side.
A new individual rule is added to the posting rule or the changes made to the rule are saved with the + button, after which the rule is shown in the rule table below the posting rule basic information.
The individual rules within an entire posting rule are shown in the table, grouped under the rule-defining conditions of transaction type + security's chosen characteristic. If an individual rule is changed, it is then re-grouped if necessary - you can always see an up-to-date grouping of your individual posting rules.
The posting rule table allows you to see all the individual rules with a quick glance, and the information of the rules is divided into columns.
- Name
The name represents the name of the posting rule group, e.g. the combination of transaction type and selected security characteristics that define when the individual rules within the group are applied. The group name is shown as "Transaction type name + Security character + Second security character", e.g. "Buy + Stock" or "Sell + Stock + Finland".
- Account
Shows the selected account of the individual rule
- Posting date
Shows the selection for the posting date for the individual rule
- Credit/Debit
Shows the selection for the debit/credit for the individual rule
- Charge type
Shows all the selected charge types as "Type 1 + Type 2 + Type 3". The list shows which charge types were checked for the individual rule and how, by adding or subtracting, they are calculated together.
To manage the posting rules more effectively, the following functions are available:
Duplicating an entire posting rule. To duplicate an entire posting rule set, e.g. all the individual rules defined within a posting rule set, click the Duplicate button on the left below the defined posting rule sets. A new posting rule set is created, and the code and name of the set are set with the text "-copy" at the end.
Duplicating a group of rules. To duplicate a group of rules, e.g. all the individual rules with the same name / the same combination of transaction type and security characteristics, right-click the posting rule group and select "Duplicate". Define the combination of transaction type and security characteristic you want the copied rules to be applied to, and new rules are created with these new selections.
Duplicating an individual rule. To duplicate an individual rule, right-click the individual rule and select "Duplicate". The selections of the copied rule are shown as default - define the combination of transaction type and security characteristic you want the copied rule to be applied to, and a new rule is created with these new selections.
Exporting posting rules in the XLS file. To export rules as an Excel file, choose the rule set, click 
and download the file.
Exporting posting rules in the CSV file. To export the rules in the CSV file that you can edit and import back in the system, choose the rule set, click Export , and download the file.
Importing posting rules in the CSV file. To import a CSV file with posting rules, click Add posting rule, fill in the Name, unique Code , and Account set fields, and click Import to upload the file. Note that the CSV file must contain the same account as in the selected account set.
Available charge types
Charge type | Description |
|---|---|
Price | Corresponds to the calculated price shown in the transaction window, for example, Amount * Unit price. |
Purchase price (no cost) | Takes into account the purchase price, without costs, associated with the transaction. |
Total tax | Corresponds to the sum of the values in the tax fields of the transaction, for example, Tax 1 and Tax 2 together. |
Accrued interest | Corresponds to the value in the Accrued interest field of the transaction. |
Total price | Corresponds to the Total trade amount of the transaction. |
Credit fee | Corresponds to the value in the upper Cost type field of the transaction (by default, this field is marked as "Credit fee"). You can use this charge type to treat all costs entered in this field as an aggregate to add or subtract. If you are using the breakdown of transaction costs (see Breakdown of transaction costs), use the list of individual transaction cost types below. |
Fee | Corresponds to the value in the lower Cost type field of the transaction (by default, this field is marked as "Fee"). You can use this charge type to treat all costs entered in this field as an aggregate to add or subtract. If you are using the breakdown of transaction costs (see Breakdown of transaction costs), use the list of individual transaction cost types below. |
Purchase price | Takes into account the purchase price associated with the transaction. If booked values are defined, they are taken into account. |
Loss | Takes into account the loss induced by the transaction (calculated from booked values if defined). |
Profit | Takes into account the profit induced by the transaction (calculated from booked values if defined). |
Currency loss | Takes into account the currency loss induced by the transaction. |
Currency profit | Takes into account the currency profit induced by the transaction. |
Loss (no cost) | Takes into account the loss, calculated without taking into account costs, induced by the transaction (calculated from booked values if defined). |
Profit (no cost) | Takes into account the profit, calculated without taking into account costs, induced by the transaction (calculated from booked values if defined). |
Tax 1 | Corresponds to the value in the upper Tax type field of the transaction. You can use this charge type to treat all tax types entered in this field as an aggregate to add or subtract. To separately specify how each tax type should be treated, use the list of individual tax types. |
Tax 2 | Corresponds to the value in the lower Tax type field of the transaction. You can use this charge type to treat all tax types entered in this field as an aggregate to add or subtract. To separately specify how each tax type should be treated, use the list of individual tax types. |
Purchase price (orig.) | Takes into account the original purchase price associated with the transaction. |
Accrued interest (purch.) | Takes into account the accrued interest associated with the purchase transaction. |
Nominal value | Corresponds to the Amount field of the transaction. |
Individual tax and transaction cost types | |
Tax types | The tax types correspond to the Tax type fields of the transaction. With the individual tax types, you can specify how each type should be treated in the posting rule, meaning if they are added or subtracted. The available tax types include both standard and custom tax types defined in Tax types. |
Transaction cost types | The transaction cost types correspond to the Cost type fields of the transaction. You can use the individual transaction cost types if you are using the breakdown of transaction costs (see Breakdown of transaction costs). With individual transaction cost types, you can specify how each type should be treated in the posting rule, meaning if they are added or subtracted. The available transaction cost types include those defined in Transaction cost types. |
Posting update
The Posting update section contains the following settings:
- Ask the user to confirm generation and updates of postings older than (excluding the date)
A setting to prevent unintended changes in bookkeeping, for example, if the user edits an older transaction by mistake which can cause postings updates. If the postings that the user tries to update are older than the specified date, the system asks the user for confirmation.
The system asks to confirm changes if the user modifies postings:
Edits and saves a transaction in the Transaction window. The system asks the user to confirm the posting updates if they have configured posting generation when saving transactions in Preference (see General).
Clicks Generate postings in the Transactions view.
Creates a posting in the Transaction window or in the Bookkeeping view.
Questions and answers about bookkeeping
I have specified posting currencies other than the portfolio currency. How are the values calculated?
Postings in the security currency use the transaction amounts where they are available. Wherever portfolio report items are used, the report FX is used to retrieve the security currency amount. Portfolio currency values are calculated using available report FX rates. For currencies specified other than the portfolio or security currency, available market FX rates are used to FX the security currency amounts to the corresponding posting currency.
I have specified posting currencies other than portfolio currency. How is FX profit handled?
FX profit considers the profit/loss between the security and the chosen currency as if it were the portfolio currency. This profit/loss is then converted with available rates to the system relative to the chosen currency.
I have specified "Security types that get the purchase value from the cash purchase price of the account". What does this mean?
For some security types, such as cash transactions, the definition of purchase price is not well defined. This setting allows you to set the purchase price for a cash-type transaction as the average purchase price of the cash in the account against which the transaction is booked. This price is the average FX rate on your cash transactions against your portfolio currency.
Example: The portfolio is in EUR. You have a USD account in which you deposited 100,000 USD at the rate of 1.25 EUR/USD. This leaves you with a purchase value of 80,000 EUR and an average purchase price of 0.8 EUR per USD. Any cash transactions that have a negative cash effect on this account are now assumed to have this as a purchased price. If you sell off the 100,000 USD on the account at a rate of 1.0 EUR/USD, the sold value in the portfolio currency is 100,000 EUR. From a portfolio perspective in EUR, this is a loss of 20,000 EUR.
Any purchase price and profit realized on transactions with this set on the security type should also be visible in Analytics+. For example, any purchase value of future cashflows should be booked from the corresponding cashflow in/out transactions and viewable in Analytics+.
I have specified "Security types that get the purchase value from the cash purchase price of the account". Does this give me the true realized profit on FX spots/forwards?
No. The setting gives you the realized profit against the account's average purchase price of cash. A true realized profit on a FX spot or forward is compared against the spot price at settlement and what you contracted at inception. It is also compared against the spot pair in all cases, whereas the average price is compared against the account and portfolio (not necessarily the same as the spot/forward pair).