There are certain Corporate Actions which require a longer timeframe to be made available in Class. This is often due to the dependency on the Class Ruling from the ATO to confirm the tax implication, or pending on the company providing all the necessary information. Class has introduced the workflow of portfolio effect and tax effect to accommodate users who want to reflect the movement of the unit until the tax implication becomes available.
The following types of Corporate Actions may have portfolio and tax effect separately processed:
- Rights Issue
To resolve this issue, you will need to process the following steps:
Step 1: The portfolio effect
Step 2: The tax effect
Processing the portfolio effect of Corporate Actions
Navigate to Business Level > Investments > Corporate Actions Console
To process Corporate Actions in bulk:
- Click anywhere on the announcement row and it will take you to the Announcement Detail screen as shown below:
- Once the portfolio effect has been implemented, the 'Process Portfolio Effect' button should be available on the screen (shown below).
- Tick the box adjacent to the fund name or select all funds that you wish to bulk classify
- Click + Process Portfolio Effect. This may take a few seconds, depending on how many Corporate Action events exist.
- The status column will update to 'Tax Not Finalised' (shown next to each of the items you have processed)
- To review the items processed for each fund, you can click on View next to 'Tax Not Finalised'
If you have any portfolio effect Corporate Actions processed, then you cannot perform a period update and will receive an error message as Class cannot perform the tax allocation. Once you have processed the final tax effect for the corporate actions, then the period update will be allowed.
Processing the tax effect of corporate actions
When the Corporate Action is updated with the tax effect (from ATO Class Ruling, company ASX announcement or share registry documents), the status will change to 'Tax Processing Required'.
The previous 'Process Portfolio Effect' button will be updated to '+ Process'.
You can bulk select affected funds and click + Process.
The system will automatically cancel the portfolio effect processed previously, and replace it with the final Corporate Action with the tax effect incorporated.
The final Corporate Action will apply the tax effect, transfer the correct cost base and apply CGT rollover relief if applicable.