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Similar to: Periodic Accrual for Loans financial institutions will want to recognize expenses/incomes accrued on deposit product accounts too.
Today, deposit products do not support accrual accounting. This spec is to enhance the accrual accounting in Mifos to support periodic accrual of expenses/incomes on deposit accounts too.
Deposit product expenses: Interest to be paid on deposit accounts
Deposit product incomes: fees, interest on overdrafts
The organization may
a) recognize income/expenses periodically (as specified as a configuration - the same as what is specified at: Periodic Accrual for Loans):
OR
b) recognize income/expenses as on a particular date (which will be manually specified when invoking the accrual job).
This feature will allow Mifos to cater to standard accounting procedures followed by larger Financial Institutions and move towards making Mifos a more accepted core banking solution by including accrual accounting for deposit products too.
Set accrual accounting frequency use case as specified at Periodic Accrual for Loans needs to be supported.
# | Title | User Story | Importance | Notes |
---|---|---|---|---|
1 | Automatic periodic accrual for deposits | At the frequency specified by the head accountant, Mifos internally invokes a batch job that will take the current date as input and recognize all unrecognized income and expenses for deposit products till this date | Must have | |
2 | Manual accrual for deposits | As a head accountant, I wish to manually invoke the accrual job as on a specific date to recognize all income and expenses for deposit products till this date | Must have | |
As specified at: Periodic Accrual for Loans
No extra attributes to be captured than what is specified at: Periodic Accrual for Loans
New permissions to be introduced for:
A new batch job which will do the following for all active deposits:
This new batch job will be invoked at the frequency specified in the "Accrual Setup" (under Accounting)
Deposit Products need to capture additional accounting General Ledger heads under which accrual of incomes and expenses will be done.
Under assets: Interest Receivable, Fees Receivable, Penalties Receivable
Under liabilities: Interest Payable
Recognition of Interest to be paid:
Interest on Savings (Expenses) Dr,
Interest Payable (Liability) Cr
Recognition of Interest (or Fees or Penalties) Receivable:
Interest (or Fees or Penalties) Receivable (Asset) Dr,
Income from Savings (Income) Cr
None
None
An API to invoke the periodic accrual batch job for deposits as on a specified date
None
Below is a list of questions to be addressed as a result of this requirements document:
Question | Outcome |
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Confirm that the handling of backdated transactions as described above is accurate from an accounting perspective | TBD |