Last Withdrawal with outstanding fees

With the last (100%) withdrawal on an account, the amount paid out to the client take outstanding fees into consideration, for instance:

100% sell of Fund A = R5000
Outstanding fees = R350
Payment to client = R4650

In an instance where the last withdrawal amount is less than the outstanding fees, the withdrawal instruction will be completed without creating a payment file to the client, for instance:

100% sell of Fund A = R500
Outstanding fees = R550
Payment to client = R0

NOTE 1:

The system determine if a withdrawal is the last withdrawal if the withdrawal is for the total remaining holdings on the account. In such instances outstanding/accrued fees are deducted from the payment amount to the client.

A 100% withdrawal that will take accrued fees will be indicated by ‘Is final withdrawal (full surrender)?’ and ‘Take accrued fees with withdrawal?’ as active on the instruction.

There might be instances where the administrator is aware that further holdings will be deposited into the account and therefore do not what the accrued fees to be deducted from the withdrawal. In such instances, the administrator can un-tick ‘Take accrued fees with withdrawal?’ and ‘Is final withdrawal (full surrender)?’

NOTE 2:

In instances where there are negative holdings in one or more instruments on a contract and a 100% withdrawal is loaded, the check boxes ‘Take accrued fees with withdrawal?’ and/or ‘Is final withdrawal (full surrender)?’ cannot be selected and a screen error will be displayed ‘Cannot take accrued fees with negative holdings in instrument: xxxx

The administrator will have to make adjustments to ensure that there are no negative holding on any instruments on the contract, in instances where the remaining accrued fees need to be taken as part of the 100% withdrawal.

Last Updated on 5 months ago by Adrienne Dill