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The Corporate Actions Module creates transactions for all accounts holding a
particular asset to account for a stock split, spin-off or merger.
For stock splits, you specify
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- the split ratio
- date
- transaction code
- transaction description lines
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The system creates transactions to adjust the units for every tax lot held by every
account. Purchase dates and total book values are not changed.
For spin-offs, you specify |
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the old and new asset IDs
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the number of new shares you get for each old share
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the percent of the book value to transfer to the new shares
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the date
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transaction codes for the transfer in and book value adjustments
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transaction description lines
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The system creates transactions to transfer in the new shares, retaining the
original purchase date with a book value calculated as a percentage of the
original book value. It also creates transactions to reduce the book value of the
old shares by the same amount. These two transactions are created for every tax
lot held by every account.
For mergers, you specify |
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- the old and new asset IDs
- the number of new shares you get for each old share
- a cash consideration (if applicable)
- the date
- transaction codes for the transfer in/out and cash consideration
- transaction description lines
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For mergers:
The system creates transactions to transfer in the new shares, retaining the
original purchase date and original book value. It also creates transactions to
transfer out the old shares. A cash consideration transaction is created if the
amount entered was not zero. These transactions are created for every tax lot
held by every account.
For either spin-offs or mergers, a separate program will create transactions to
sell any fractional shares that resulted from the corporate action.
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The Corporate Actions Module adds value to the core system by … |
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- saving time compared with hand calculation of transactions needed to properly
account for corporate actions.
- eliminating the opportunity for human input error by automating the transaction
creation.
- providing functionality for both publicly traded securities and private funds (such as a
common fund or pooled income fund).
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- Transaction Import will need to be supplemented by this module in order to properly
create transactions on the tax lot level, and transfer book value and purchase date
information to the new assets involved in a spin-off or merger.
- Broadridge Proxy Mailing Service provides access to a website (through Xcitek) to
research corporate action information. This is especially useful for determining the
percent of book value allocated to the new security for a spin-off. This service is
complimentary for Broadridge (formerly called ADP) Proxy Mailing clients who have
not had a separate agreement with Xcitek within the past 12 months.
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