T24 Account Introduction

Welcome to the T24 Account Introduction Course

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T24 Account Introduction

In this course, we will cover a Product Overview of Account and its Dependencies

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T24 Account Introduction

These are the learning objectives of this course. You will learn the Core Tables and the
Business Features of Account. The Importance of Account Application to other T24
Applications and how to Open different types of Account and Preferential Conditions.

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T24 Account Introduction

In this course, we will cover a Product Overview of Account and its Dependencies

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T24 Account Introduction

The ACCOUNT application caters to creation and maintenance of all types of accounts
handled by T24. In T24, Accounts can be classified as two types, namely Customer
account and Internal type of account. Customer accounts are opened for and owned by
external customers.
Internal accounts are maintained by the bank for its own purpose, like cash account,
suspense account, etc.
This module provides for calculation, accrual and application of interest on customers'
accounts. Interest rate could be either Fixed or Floating. Further it can be level or
banded. In addition, it is used for calculation of charges relating to maintenance and
servicing of accounts. Rules for interest and charges can be set for an individual account
or for a group of accounts.
The Account application stores only static information. The financial data is updated in
EB.CONTRACT.BALANCES. ECB has the fields to display the updated account balance
field, Date moved fields and Exposure management fields.
It is used for account statements and issue of passbook for certain class of customer
accounts.
It is possible to handle cheque book management in T24, like issuing, controlling stock,
recording payment, noting and effecting stop payment instructions.
Signature of account holders can be captured by another module called image
management.

The ACCOUNT.CLOSURE application is used for closing accounts.

Sweeping of balances between accounts can also be handled. A separate course is

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T24 Account Introduction

available for Account sweep and cash pooling.

Remember:
All the transactional balances and data are held on the EB.CONTRACT.BALANCES record
for the account.
Account holds financial information in T24 releases before R12. During upgrades of such
releases, we have an option of retaining account balances in account table as well along
with ECB.

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T24 Account Introduction

We will now cover the Dependencies

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T24 Account Introduction

We need to have Customer records to refer counter party in the case of customer type
of accounts. Customer details such as name, nationality, residence etc., are not entered
in individual account record. These are held in the customer base record.

Accounting entries are raised for accrual and capitalisation of interest and charges.
When transactions are input through other applications, the appropriate account
balances are updated on real time basis.

Delivery system is used to produce account statements, interest statements and

interest/ charges advices. Formats, addresses and number of copies required are
specified within the delivery system. Interest and charges advices may be printed or sent
via SWIFT. Interest and charges module passes the required information to delivery
system, which transforms it into appropriate messages.

Limit is core to T24.

FX contracts require settlement accounts and other contracts like LD, MM, etc require
drawdown account and liquidation accounts.

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T24 Account Introduction

Category codes are used to classify financial products based on the type of business
operation or product. The first two digits of the Category code represent the highest
level classification and the next three digits represent a sub-classification.
Although it is possible to have Customer type accounts defined in the Category range of
1000 to 9999, suggested range of sub categories for different types of accounts are also
mentioned.
If there is need for defining additional sub-classifications, care is to be taken to ensure
sufficient details do not already exist to provide required breakdown. For example, we
need not define separate CATEGORY codes for resident and non-resident customers or
for local and foreign currency transactions. The category codes together with other
CUSTOMER characteristics like segment or industry or residence enables Banks to
produce profit & loss statements , balance sheet and returns reflecting coordinated and
structured view of the operations.

Internal account types fall under the Category range of 10000 to 19999. Interest and
charges cannot be accrued in Internal Accounts. For example sub category range for
cash accounts is suggested in the range of 10000 to 10999, while suspense accounts,
fixed assets account and capital accounts are suggested in the range of 11000 to
19999.

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T24 Account Introduction

Floating interest rate types are defined in BASIC.RATE.TEXT

Table and the actual rates applicable are updated in BASIC.INTEREST Table. In
BASIC.INTEREST table, rate change is indicated with the effective date for such a change,
the underlying Accounts derive the new rate from this table.
It is possible to set negative rate of interest in BASIC.INTEREST. It is used only in MM,
SW and DX applications.
Though negative spread can be specified over basic interest rate for all types of
accounts, yet it is possible to set negative interest rates only for accounts in credit
balance. To do this, the NEGATIVE.RATE Field on GROUP.CREDIT.INT or
ACCOUNT.CREDIT.INT must be set to Yes or BLOCK.MARGIN.
If set to YES, this would enable collecting interest from accounts with credit balances.
Negative interest in an account could result due to a negative spread being higher than
the underlying floating rate. For example, a negative spread of 2% (Minus 2%) on LIBOR
which is 1.5%. In this case as the interest being capitalised is negative, it will be debited
from the customer account instead of making the interest as zero. If set to no, then the
rate would be considered as Zero. If set to BLOCK.MARGIN, negative effect will not be
allowed because of margin. Negative margin can not make the rate more negative or a
positive rate to negative. For Example, If base rate is -7, ( Minus 7%) margin is -2 (
Minus 2%) then net effect will be -7 ( Minus 7%).If margin is +2 ( Plus 2) then the
effective rate become -5 ( Minus 5).If base rate is +5 ( plus 5%) and margin is -7 ( Minus
7%) then effective rate will be zero not negative.

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T24 Account Introduction

FT.COMMISSION.TYPE table is used to indicate predefined commission to be collected.

For example the charges could be for closing an account or cash withdrawal charges. The
charges could be defined currency wise at a flat charge for all transaction amounts.
Alternatively, charge can be defined as a percentage of the transaction amount. It is also
possible to set the charges either on level or band basis. It is possible to set charges and
commissions for maintenance of accounts by linking the required FT.COMMISSION.TYPE
record to GENERAL.CHARGES. It is also possible to set a Minimum or Maximum charge
either in absolute amount or in percentage of transaction amount.

AC.CHARGE.REQUEST is used as an interbank facility for requesting or advising many

types of charges from other financial institutions.

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T24 Account Introduction

TRANSACTION.CHARGE table allows to define a charge for a Transaction defined in

TRANSACTION Table. The charges can be defined in absolute amount or in percentage
with control over minimum and maximum amount charge amount. Alternatively, a
charge defined in FT.COMMISSION.TYPE can also be linked in TRANSACTION.CHARGE
Table.

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T24 Account Introduction

AC.CHARGE.REQUEST is used as an interbank facility for requesting or advising many

types of charges from other financial institutions. FT.COMMISSION.TYPE records is linked
to AC.CHARGE.REQUEST for such purposes. System defaults charge amount as per
definition of the linked FT.COMMISSION.TYPE Record. User can specify different
amount. Status of charges is also maintained.

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T24 Account Introduction

There are the currency related static tables used for ACCOUNT application.
COUNTRY table is used to record static information of individual Country. The details
include Country Name, Currency Code, etc.
CURRENCY.PARAM table contains the basic details of every individual Currency. The
basic details include the Numeric Currency Code, Currency Name, Number of Decimal
Places and the Interest day Basis to ensure that the same details are used on the
different currency files in a multi company environment.
The Markets defined on CURRENCY.MARKET table are used to identify the correct
exchange and revaluation rates to be applied for a Currency. For example: Different
market exchange rate are applicable for Currency Notes and Travelers Cheques.
CURRENCY table holds currency wise details of number of decimals, exchange rates
like buying, selling, middle and revaluation rates for different currency markets. These
details can be maintained manually or through interface. .
Currency Market is one of the Mandatory Key for Consolidation of Assets and Liabilities
in T24.
Interest day basis will be defaulted as per the currency used. It is possible to change at
the group level or account level.

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T24 Account Introduction

Different interest day basis for calculation of interest is possible depending on the
method followed for calculating number of days in interest period and days in a year. In
the INTEREST.BASIS table, different basis applicable in T24 are available as A, B,C,D,E,F
and None . Here, the number on the left (Days) (Numerator) represents the basis for
number of days in the interest period whilst number on the right (Denominator) is the
number of days taken in the year.
For example: If Interest Basis B (366/360) is selected, then the interest calculation would
look as follows:-
Principal Amt x Rate x 366 / 360
For A 360/360 , 30 days in each month and 360 days in an year.
For D 360/366 , 30 days in each month and 366 days in an year.
When Interest day Basis NONE is chosen for group of accounts/an account , no interest
is applied.
Interest day Basis GENERAL and G are used while setting Account specific interest
conditions using ACCOUNT.DEBIT.INT and ACCOUNT.CREDIT.INT tables. When the
account specific conditions are meant only for a specific period and after which we
would like the Group specific conditions to be automatically applied, we can use the
GENERAL basis. No interest rate would be allowed to be indicated under this method as
the interest conditions set in the Group level would be automatically applied from the
date indicated in the Ids of these records.
From R14, ‘A3’ and ‘A4’ interest basis is introduced. A3 is used to handle cases where
each month is to be considered as 30 days. For South American market, ‘A4’ interest
basis is used.

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T24 Account Introduction

1: It is possible to accrue interest and charges for customer accounts and not possible
for internal accounts. Counterparty is mandatory for customer accounts and not allowed
for internal accounts

2: No. Negative interest is possible for only credit balances.

3: Using ACCOUNT.CLOSURE Application.

4: 29 days

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T24 Account Introduction

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