Certificate Maintenance

This document provides technical guidance on utilizing the Certificate Maintenance feature within the FLEX System, designed for credit union professionals managing certificate accounts.

1. Accessing Certificate Maintenance

The Certificate Maintenance function can be accessed through two primary methods:

  • FLEX Main Menu:
    • Navigate to Certificates
    • Select Certificate Maintenance
  • Member’s Account (Transaction/Entry Inquiry):
    • Access the member’s account.
    • Right-click on the specific certificate.
    • Select Certificate Maintenance from the context menu.

2. Overview of the Certificate Maintenance Screen

The Certificate Maintenance screen provides a comprehensive view and management interface for individual certificates. Key sections and functionalities include:

  • Account Information:
    • Account: Displays the account number.
    • Certificate Type: Shows the type of certificate (e.g., B1-30 MNTH CD $1000).
    • Custom Description: Allows for a custom description of the certificate.
    • UDFs (User Defined Fields): Access to additional user-defined fields.
    • ANNA M JOHNSON: Displays the member’s name.
  • Action Buttons:
    • Unlock: Unlocks the certificate for editing.
    • Save: Saves any changes made to the certificate.
    • Refresh: Refreshes the displayed certificate data.
    • Delete: Deletes the certificate (use with caution).
    • Calculate Penalty: Calculates and displays the early withdrawal penalty without applying it.
    • Mature Early: Initiates the process to close the certificate early.
    • Pay/Memo Dividend: Allows for calculating and paying or memoing dividends.
    • Step Up: Enables entry of a step-up rate.
    • Calculate Interest: Calculates projected interest based on various parameters.
    • Renew Certificate: Renews a previously matured and dormant certificate.
    • Print Certificate: Prints a certificate form.
    • Print Notice: Prints a renewal notice for the certificate.
    • Audit: Provides an audit trail for changes.

3. Key Sections and Fields

3.1 Account Balance Tab (Tab 1)

This section provides a summary of the certificate’s financial status.

  • Current Balance: Displays the current balance in the certificate.
  • Amount Pledged: Shows any amount pledged against the certificate.
  • Amount Available: Indicates the amount available for withdrawal.
  • Last Statement: Displays the balance at the time of the last statement.
  • Starting Balance: Used for printing certificates prior to the initial deposit. Note: Inputting a starting balance here does not replace the need for an initial deposit via transaction entry.
  • Agreed Monthly Deposit: The amount the member agrees to deposit monthly, if applicable.

3.2 Dividend Options

Settings related to dividend calculation and payment.

  • APR/APY:
    • Defaults from the current certificate rate table.
    • Can be changed by clicking the appropriate button and entering a new value.
  • Rates with RP Bonus: Displays the total rate after any Relationship Pricing bonus has been applied.
  • Payment Frequency: Selects the frequency of dividend payments.
  • Compounding Daily: Checkbox to enable daily dividend calculation and compounding.
  • Variable Rate Code: Used to indicate a valid variable rate code, if applicable.
  • Pay To Account:
    • Enter the account/suffix where dividends will be paid.
    • Defaults to the certificate suffix when opened.
    • If left blank, dividends will be paid via check to the member.
  • Alternate Payee: Becomes available if “Pay To Account” is blanked out, allowing entry of alternate payee information.

3.3 Dates

Important dates related to the certificate’s lifecycle.

  • Maturity: System-calculated maturity date based on the term defined in the certificate type record.
  • Next Dividend Pay: System-calculated next dividend payment date based on the defined frequency.
  • Last Dividend Calc: The date of the last dividend calculation.
  • Last Renewal Notice: Date the last renewal notice was printed.
  • Last Transaction: Date of the last transaction on the certificate.
  • Last Update: Last date any changes were made to the certificate.
  • Last Renewed: Last date the certificate matured and renewed.
  • Opened: Displays the certificate open date.
  • Closed: Displays the certificate closed date.

3.4 Renewal Options (Tab 2)

These options dictate how the certificate behaves at maturity.

  • Option 1 (Renewal Action at Maturity): Select the desired action:
    • Automatically Renew
    • Close, transfer balance to shares
    • Close, send check
    • Leave certificate as is, in a dormant state
  • Options 2, 3, and 4 (Used only if Option 1 is “Automatically Renew”):
    • Option 2 (Renewal Confirmation Notice):
      • None
      • Print renewal confirmation
      • Do not print renewal confirmation
    • Option 3 (Certificate Number Option):
      • None
      • Increment certificate number
      • Do not increment certificate number
    • Option 4 (Rate Option):
      • None
      • Use rate defined in control file
      • Renew certificate at same rate
  • Certificate Number: Displays the certificate number, if applicable.
  • Renew as Type: Optional field to renew the certificate as a different type (if Option 1 is “automatically renew”).
  • Transfer to Suffix: If Option 1 is “close, transfer to shares,” this field becomes available to specify the suffix for fund transfer at maturity.

3.5 Penalty Options

These options are used for calculating and applying early withdrawal penalties. They are typically defaulted from the certificate type but can be changed.

  • Charge Dividend Days: Number of days used to calculate the penalty.
  • Grace Days: Number of days after maturity a member has to transact before a penalty is applied.
  • Charge on Reduced Rate: Enter a rate if the penalty fee should be charged using a reduced rate.
  • Cut Into Balance: Checkbox to indicate if the penalty will reduce the principal balance if it exceeds earned dividends. The penalty will cut into either the original or current balance based on certificate type definition.

3.6 Penalty Amounts

Displays historical and current penalty information.

  • Paid This Year: Year-to-date total of any penalties paid on the certificate.
  • Paid Last Year: Previous year’s year-to-date total of any penalties paid.
  • Current Early Withdrawal Fee: The current fee for early withdrawal.

3.7 Miscellaneous

Other relevant certificate information.

  • Suffix Frozen: Checkbox to indicate if the suffix is frozen, preventing transactions.
  • Closed Reason Code: Displays the reason code if the account is closed.

3.8 OID Information

Details related to Original Issue Discount (OID) reporting to the IRS.

  • OID Has Been Reported: Displays OID amounts already reported to the IRS.
  • OID To Be Reported: Displays OID amounts that will be reported to the IRS.
  • INT To Be Reported: Displays interest amounts that will be reported to the IRS.

3.9 Dividend Amounts

Summary of dividend payments.

  • Paid This Year: Dividends paid to the certificate for the current year.
  • Paid Last Year: Dividends paid for the previous year.
  • Paid Since Issue: Dividends paid since the certificate’s open date.
  • Paid Since Renewal: Dividends paid since the last certificate renewal date.
  • Memo Dividend: Dividends accrued but not yet paid.

3.10 IRS Withholdings

Information on IRS backup withholdings.

  • Backup Withholding YTD: Year-to-date amounts withheld for backup withholding in the current year.
  • Backup Withhold Last Year: Amounts withheld for backup withholding for the previous year.

4. Functionality Details

4.1 Calculate Penalty

  • Purpose: To display the early withdrawal penalty if the entire certificate amount were to be withdrawn today.
  • Note: This action is for informational purposes only and does NOT apply the penalty. For partial withdrawals, the penalty will be displayed during the transaction process.

4.2 Mature Early

  • Purpose: To close the certificate before its scheduled maturity date.
  • Process:
    1. Click Mature Early.
    2. A prompt “Do you wish to Mature this Certificate Early?” will appear. Select Yes or No.
    3. If Yes, the “Early Mature Penalty Fee” dialog will display the calculated penalty.
    4. Select Accept Fee, Waive Fee, or Cancel.
  • System Behavior: Depending on the certificate type configuration, the system will:
    • Calculate and pay dividends through the current date.
    • Calculate and charge the penalty against the certificate.
    • Make the remaining balance available for withdrawal.

4.3 Pay/Memo Dividend

  • Purpose: To calculate and pay or memo dividends.
  • Process:
    1. Click Pay/Memo Dividend.
    2. The “Pay/Memo Dividend” dialog will display Interest Due.
    3. Select Pay Dividend (to pay dividends due) or Memo Dividend (to store dividends in the memo dividend field for future payment).
  • Effect: Setting the last dividend calculation to today’s date. The next interest payment will include any memoed dividends.

4.4 Step Up

  • Purpose: To manually enter a step-up rate for the certificate.
  • Process:
    1. Click Step Up.
    2. Enter the New APR for the step-up.
  • Considerations: Step-up limits and frequencies are controlled in Type Configuration. This is a manual process based on credit union policy.

4.5 Calculate Interest

  • Purpose: To project interest calculations based on various “what if” scenarios.
  • Process:
    1. Click Calculate Interest.
    2. Key in the Amount, Term Code, and Number of Terms.
    3. Other values (e.g., Frequency, Interest Rate, Daily Compounding, Effective Date, Days In Year) will default from the certificate but can be modified for calculations.
    4. Click Calculate Interest within the dialog to view Interest Due and Balance calculations.

4.6 Renew Certificate

  • Purpose: To renew a certificate that has previously matured and is in a dormant state.

4.7 Print Certificate

  • Purpose: To print any certificate form.
  • Process:
    1. Click Print Certificate.
    2. The “Print Forms” screen will display Default Forms available for printing.
    3. Select the desired form.
    4. The Form Details section will appear, potentially with additional prompts based on the form content.
    5. Options include:
      • Preview: Allows previewing the form before printing.
      • Print/Archive: Prints and/or archives the document.
      • Add to Envelope: Adds the document to an envelope when using DocuSign.

4.8 Print Notice

  • Purpose: To print a renewal notice for the certificate.
  • Note: Renewal notices are typically generated for all certificates simultaneously. This option is for reprinting lost or destroyed notices.
  • Process: Enter the date of the renewal rate, if known.