Configuring profitability settings

From the Profitability Configuration tab in RPPS, you can update configuration settings for credit risk, capital allocation, expense allocation, transaction rates, and tax rates.

Risk ratings

In the Credit Risk tab, the Risk Ratings sub-tab allows you to set ranges for FICO scores, which are used by lenders and creditors to help assess the creditworthiness of their customers. You can also set risk ratings and assign other ratings to your accounts to help you provision for potential loan loss.

For more information, see Configuring risk ratings.

Risk groups

In the Credit Risk tab, from the Risk Groups sub-tab you can add risk groups and assign risk rating types. This is done because multiple products typically are grouped by product characteristics, and all products in the same group have the same allocation rate.

For more information, see Configuring risk groups.

Risk allocation rates

After you define your risk ratings in the Risk Ratings sub-tab and assigned risk ratings to risk groups in the Risk Groups sub-tab, from the Risk Allocation Rates sub-tab you can assign provision rates to each risk group.

NOTE: Rates are expressed monthly.

To assign risk allocation rates:

  1. Locate the desired product risk group.
  2. Enter a percentage rate into the text box corresponding the risk ratings you want to apply to that product risk group.
  3. In the top-right corner of the page, click Save.

Capital risk

From the Capital Allocation tab, you can set up capital risk groups and create a capital risk scale before assigning rates and before any capital allocation calculations can be done.

For more information, see Setting up capital risk.

Expense allocation

From the Expense Allocation tab, you can create new expense groups and assign Expense and Future Pricing Transaction rates.

For more information, see Configuring expense allocations.

Transaction rates

From the Transactions tab, you can group imported transactions.

NOTE: By default, the tab displays data for the most recent month. To view or edit data for a different month, click the filter icon at the top-left of the page.

To add or modify a transaction group:

  1. In the Transaction Group column, click + Add New Transaction Group link .
  2. In the Transaction Group column, in the text field, type a name for the transaction group.
  3. In the Instrument Type column, select an instrument type from the drop-down list.
  4. In the Income column, select an income category for fees from the drop-down list or type in the field to search the listed income categories. This step is optional.

  5. In the Income column, enter any fees associated with the selected income category in the text box. This step is optional if you did not select an income category.

  6. In the Expense column, select an expense type from the drop-down list. This step is optional.

  7. In the Expense column, enter an amount to create a charge for the expense type. This step is optional if you did not select an income expense category.

    NOTE: The system applies any categories and fees to all transactions assigned to that transaction group. Skip this step if the transaction type is an income rather than an expense.

  8. At the top-right corner of the page, click Save .

    The new transaction group displays as an option in the Transaction Code Group column drop-down menus on the right-hand side of the page.

NOTE: You can find your imported transactions on the right-hand side of the page. After you create a transaction group, you can use the Transaction Code Group drown-down to apply it to one or more individual transactions.

Tax rates

From the Tax Rates tab, you can define an effective tax rate. In the Rate column, enter a percentage for the tax rate.

Product report groups

In the Product tab of the Profitability Configuration admin area, from the Report Group sub-tab you can add or modify product report groups for assets and liabilities.

To add or modify a product report group:

  1. In the Product Report Group column, click + Add New Asset Report Group or + Add New Liability Report Group.
  2. In the Product Report Group column, in the text box, type the name of the report group.
  3. In the Sort column, type a numerical value to order the report group among the other report groups.

Product settings

In the Product tab of the Profitability Configuration admin area, from the Report Group sub-tab you can add or modify product report groups for assets and liabilities.

For more information, see Configuring product settings.