This page is to assist you with adjusting opening balance DRP residuals amount when the funds are first transitioned to Class, so that you can maintain correct DRP going forward.
This covers both scenarios where an existing DRP cash surplus account has been and used in prior year, as well as where no prior year DRP residual has been accounted for in prior income years.
Existing Prior-Year DRP Cash Surplus Account
Where funds are first transitioned onto Class, the DRP residual amounts are allocated to a custom holding account named DRP cash surplus. This section provides a step-by-step guide to allocating DRP residual amounts to their specific holding account.
Navigate to Fund Level > Fund > Load Opening Balances
- Review the balance of the DRP cash surplus (This Custom Holding account will be found under Other Investments at the bottom of the Holdings tab)
- Enter the closing residual balance amounts held at year-end into the DRP Residual boxes against the relevant security:
- Once you have allocated the opening residual amounts, remove the balances contained in the DRP residual custom holding account. You will need to clear or enter $0.00 to both the amounts contained in the Market Value and Book Cost fields.
- Click on the Submit button to save the adjustments:
- Delete the custom holding account. Navigate to Investments > Browse holding accounts and click on "Show Zero Balances", then click on the custom holding account. The Account Details will open and click on Edit and Delete:
No DRP residual accounted for in prior years
In this scenario, there are no DRP Residual amounts in the fund opening balance.
In the below example, the DRP residual balance of $28.83 as per the dividend statement has not been accounted for in the ledgers opening balance.
- At the Fund/Portfolio level, navigate to the relevant dividend business event and click on the Edit function.
- Tick the Includes Reinvest and click onto Use this Announcement button to allow Class to auto populate the DRP details:
- Use the Residual Adjustment (+/-) field to adjust the variance of the balance contained in Carried Forward Residual Balance to be reflective of the dividend statement balance. The opening residual balance per the dividend statement is entered in this field
- Confirm DRP details and click Submit to save changes
An unmatched business event will be created for the adjusted residual amount entered in the Residual Adjustment (+/-) field, as residual is essentially an adjustment from the cost base of the investment holding.
Navigate to Fund Level > Transactions > Investment – Corporate Action > Capital Return
Navigate to Fund Level > Transactions > Investment – Corporate Action > Capital Call
Create a Capital Return (for a negative residual adjustment) or Capital Call (for a positive residual adjustment) to offset the residual adjustment.
Enter information in the Capital Return fields based on the holding information. Click the Submit button to process the capital return event then go to Match Transactions and match the Capital Return event with the outstanding DRP adjustment event.
We will teach you how to process a DRP Residual Receipt