Carry Forward

The management of Carry Forwards is based on the following operating principles.

• You can carry forward a transaction only after its back-office validation.
• You cannot carry forward a transaction resulting from an early settlement. In the same way, you cannot early settle a transaction resulting from a carry forward process.
• You can perform multiple partial carry forwards for Forward Transactions. Then, you get partial carry forwards performed from a single initial transaction. But you are not authorized to perform "consecutive" partial carry forwards. Actually, you can carry forward a same transaction only once.
• At the carry forward maturity, you need to settle the transaction in order to put an end to it and to update consequently the position.

• When the carry forward is total, the initial transaction is settled. You cannot modify it anymore. However, you can view it and re-edit its mails or its ticket. This principle is common to Loans, Borrowings and FX Transactions. It is automatically applied: you do not need to use the manual settlement function to complete the initial contract.
• When the carry forward is partial, two cases are possible.

• The carry forward concerns only a part of the contract and must be followed by the balance settlement: With Settlement option must be enabled in the Characteristics tab of the Carry Forward page. This option is similar to the Settle option used to complete the original transaction.
• The carry forward groups several partial carry forwards at different maturities and the settlement of the initial transaction should not be performed yet: the intial transaction is automatically settled if, during the entry of the last partial carry forward, its amount is null. In other words, the totality of the original transaction was carried forward several times. If there is a remaining balance on the initial transaction, the settlement is effective if, and only if, the With Settlement option was enabled during the entry of the last partial Carry Forward, or if the settlement was explicitly required on the original transaction through the Settle option.

1. In the management page for Forward Exchange Transactions, enable the option next to the line to select.
2. In the Process menu of the actions toolbar, click the Carry Forward option.
3. In the dialog box, click yes to confirm the current action.

The window for the carry forward of the forward exchange transaction, opens up.

The Characteristics tab enables you to enter information on the carry forward: total or partial carry forward, amount of the carry forward in case of partial carry forward, transaction dates of the carry forward.

The following table describes the elements of the header and the Characteristics tab.

The crosses in the E column indicate that the fields are editable.

View Table

Field	Description	E
Header
Buy/Sell	Direction of the forward leg for the carry forward This field cannot be edited.
Transaction	This field enables you to select a transaction type for the forward leg of the carry forward, depending on the defined direction of the leg. Click the button to view the list of existing transaction types for this leg direction, then, in the contextual window, double-click a line to select it. The code and description of the selected transaction type, are displayed in the Transaction field.
No.	Transaction Identifier
Link No.	This optional field enables the grouping of commercial transactions and FX transactions together, under a common link number. This number shows the assigned category (activity type, geographical area, project, etc.). It can then be used as a criterion of accounting or filtering processes, depending on your hedging strategy (micro-hedging or macro-hedging). For more information on link numbers, see Setup documentation. To select a link number, use the button as explained previously. The link number is assigned to the spot leg and to the forward leg of the carry forward.
Type	Type of the forward leg for the carry forward For carry forwards, this is the "Deferment" type of the carry forward spot leg. For more information on the FX transaction types, see topic FX Transaction Types.
Analysis area
Folder	Number of the file For more information on folders, see the Setup module documentation.
Portfolio	To select a portfolio number, use the button as explained previously. For more information on portfolios, see Setup documentation.
Participants area
Company	Applicant (Company)
Counterparty	Counterparty with which the transaction is concluded
Contact	Enter the name of the contact for the counterparty. If you defined a name when setting up counterparties, this field is automatically completed. However, you can change the name which will be used in the confirmation letter.
General area
CTRV Modes	Mode of entry and calculation for the amounts and the rate The default and non-editable value for Carry Forwards, is Enter Rate. In case of a partial carry forward, you can edit the transaction amount in the main currency and the currency rate. The countervalue is automatically calculated.
Partial Carry Forwards	Enable this option in case of partial and non-total carry forward. If you enable this option, and depending on the selected entry mode (as described previously), the Settlement Amount field is enabled.
With Settlement	In case of a partial carry forward, enable the option to settle automatically the balance remaining on the original transaction. Disable this option when partial (multiple) carry forwards must take place at different maturities.
Carry Forward Amount	These fields display the main currency and the amount of the carry forward in the main currency. The main currency cannot be modified. The default value for the amount is the transaction balance. If you enabled the Partial Carry Forward option, you can lower the displayed amount by entering a value or using the calculator. For more information on how to use the calculator, click here. When you modify this amount, the value in the Carry Forward Countervalue field is automatically recalculated.
Carry Forward Countervalue	Countervalue currency and amount of the carry forward expressed in the countervalue currency
Carry Fwd TRX Date	Date on which the carry forward is set up This date will also be used as the transaction date of the spot and forward legs. The default value for this field is the maturity date of the carried forward transaction. This field cannot be edited.
Carry Fwd Value Date	Delivery date of the spot leg for the carry forward and the value date of the forward leg for the carry forward It falls two days after the date of the carry forward. This field cannot be edited.
Carry Fwd Maturity Date	Maturity date of the forward leg for the carry forward This field will not be used for the spot leg of the carry forward. This field cannot be edited. The default date is the delivery date of the initial transaction. If you defer the delivery date, this date is replaced by the delivery date minus two days.
Carry Fwd Delivery Date	Delivery date of the forward leg for the carry forward This field will not be used for the spot leg of the carry forward. It is the date on which the carried forward currencies are actually delivered. The default date is the maturity date plus two days. You can replace this date by a later day, either by entering the date directly in the field, or by using the calendar. For more information on how to use the calendar, click here.
Rate area This area displays information on foreign exchange rates.
Rate	In this field, select the type of exchange rate to apply to the spot leg created to cancel the initial transaction. Market Rates: the default rate is the spot rate at the carried forward transaction date. Historical Rate: the reference spot rate is the forward rate of the initial transaction.
Spot Leg Rate	Exchange rate of currencies for the spot leg of the carry forward
Forward Leg Spot Rate	Spot exchange rate of currencies for the forward leg of the carry forward
Spot Differential	Difference between the spot rate of the carry forward and the forward rate of the original transaction In case of a carry forward at the historical rate, the value of the spot differential must be zero.
Amount Differential	This amount corresponds to the difference between the countervalue of the carried forward amount (calculated on the basis of the carry forward spot rate) and the countervalue of the carried forward amount (calculated on the basis of the initial contract forward rate). Its formula is the following: Carried Forward Amount * Spot Differential. In case of a carry forward at the historical rate, the value of the amount differential must be zero.
Swap Points	Difference in points between the forward exchange rate and the spot exchange rate for the forward leg of the carry forward
Forward Rate	Forward exchange rate of the currencies for the forward leg of the carry forward

The Cross Rates, Settlement, Back Office and User Field tabs are the same as for Forward Exchange Transactions. For more information about these tabs, click here.

In these tabs, the following elements can be edited: bank details of the settlement, information on G/L assignment and notes. The default values are those defined for the original transaction.

To know the balance of a transaction which was subject to carry forward, refer to the transaction amount in position in the Exchange Ledger. For more information on this report, see topic FX Transactions Ledger.

The initial transaction and the spot leg of the carry forward cannot be modified after the carry forward.

As long as the leg is not settled, the following elements concerning the forward leg of the carry forward, can still be modified:

• link number,
• portfolio number,
• name of the counterparty's contact,
• bank accounts and value dates of the settlement,
• reference,
• information on the G/L allocation,
• notes.

For more information on these fields, refer to topic Forward exchange.

The initial transaction cannot be deleted after the carry forward.

You can delete the spot leg or the forward leg of the carry forward: deleting one of the two legs involves the automatic deletion of the other one while the original transaction takes the "Initial" status instead of the "Deferred" status. The carry forward is now cancelled.