The next steps are inside "I prepare the accounting files D-1"





 1. Enter the Title of the operation / page

2. Add the following Labels : 

    • Scope of applicability: ww, country_accounting 

    • Country or group of countries (if applicable): belux, china, france, italy, lam, nam, uk_ie, bulgaria, dach, netherlands, iberia, poland, latvia, australia, india, japan, south_korea, thailand, singapore, new_zealand, emea_transversal, apac_transversal

    • Unit and Domain according to the List of labels to be used in the Finance Service Line space

      • E.g. 1: WW Operation in Financial Accounting under domain "Central Finance Processes & Compliance":
        • Labels to be used: ww, financial_accounting, central_fin_proc_compliance

      • E.g. 2: France Operation in Financial Accounting:
        • Labels to be used: country_accounting, france, financial_accounting
          (for country operations, the Domain is always country_accounting)


3. Fill in all fields as described above

4. Name the title of each section using OPD methodology naming convention - Infinitive verb without the “to”, mainly action verb...something) - " I do something..."

5. Once the description of the operation is completed, ensure it is approved and published by launching the SBS-Finance approval workflow 


Domain: Treasury Reporting

Responsibility area: Ensure consistency of data until D-1

Table of contents 

By default the table of contents displays Heading 1 & Heading 2 (other levels can be added)


Scope

3. Remove the icon when not applicable



ERP


Frequency


 

 

 

References

6. Add the link to SAP transaction(s) (when it exists)



Forms

7. Insert the links accordingly and change the link text with the Form name



Attachments

8. Add the link to attachments or external links




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1. Objective and Scope

1.1. Objective of this Operation

WHY - Describe the objective of the operation

The accounting bookings for SES were designed according to at least 4 factors: Traitment Comptable, Book, Deal Type and Underlying Asset:


It is important that all data is consistent from month to month otherwise we can have problems when controlling the accounting files. So, to prevent that from happening its important to know in advance if there are any changes on the way the contracts are registered by the business. In this procedure we will highlight what to look for in each database.

It´s also important to know the meaning of each item, so please find the following useful information:

Traitment Comptable

PnL - Fair Value Hedge (Trade)

Own Use - Not considered (IFRS accounting exception hence no postings required)

CFH - Cash flow hedge


Book


Deal Type

Its all derivatives contracts used by the business. For example: forwards, swaps, futures, options, etc.


Underlying Asset

CO2

Commodities: gaz, electricity, palladium, coal, etc


1.2. Scope

Detail the scope (legal entities, etc.)

This procedure applies to company 3865

2. Definitions

Definitions should be added in the Finance Glossary - Add definition and link it to respective Letter in Finance Glossary 

See Finance Glossary:

OtC


3. Tasks description

WHAT and HOW - Main content of the operation

The content should be mainly organized in 2 levels of Headings to ensure a proper link with the Table of Contents.

Select the level of heading in the "Paragraph" option.

3.1. I send an email to SES-risk team

We start by sending an email to risk team. The following print screen is an example of the email to be sent:

We normally receive 3 files: "DDMMYYYY_NRJoff_Final_DDMMYYYY", "Off analysis CO2" and "DDMMYYYY_CTRL_TRANSFER". Please save them in the folder of the month being closed. Example: \\NOHVFS01\Treasury-GAR\SES\2021\11 2021\D-2

We will use "Off analysis Energy" and "Off analysis CO2" to make our checks and the subchapters from 3.2 to 3.5 explains what to do in each file.

Specifically for file "DDMMYYYY_CTRL_TRANSFER" the intention behind is to check the back-to-back deals (or mirror transactions). Why? They are transactions that have the same terms but taking the opposite positions from their originals. In another words, SES buys an underlying asset from the external market and sells to a Solvay company. This is why this control exists because we check if the quantity of the back-to-back deals are zero. Otherwise it means that we either miss the original deal or the mirrored deal:


When risk team send us this file they already analyzed this part. We just check if the quantities on their pivot table are in fact mirrored (meaning quantities should be equal to zero):



From this printscreen you can see that it´s not the case. In these situations we should have a justification behind or at least we should inform Risk team that the quantities are not zero and they should send us a justification. Example:


3.2. I check "DDMMYYYY_NRJoff_Final_DDMMYYYY"


Please go to the previous month folder and copy paste the file "NRJoff_Month end check_D-2" named to the current month´s folder. You will find 6 tabs.

To update the tab "Master data Energy Official" please copy paste values+format from excel file "DDMMYYYY_NRoff_Final_DDMMYYYY" tab "Analysis". To update the tab "Master data Matrix" access GDRIVE, download the report to excel and copy paste values the column "SWAP Contract ID" (please bear in mind to copy the information coming from the tab corresponding to the year because you might find other tabs from previous years).

  

3.2.1. I check for new contracts to book the provision amounts

This task allow us to anticipate the preparation of Hedge file for the provision settlements. Please go to tab "New contract settlements Pivot" and you will find a pivot table that needs to be refreshed. The pivot will show contracts with settlement amounts and it has the following filters: 

Column BQ (company code): select all companies (except blanks). Blanks = external counterparties

Column BJ (Settlement Type): select "Settlm"

Column F (Market): do not select MKTGNYME

Column BI (Settlement Exposure): don´t select zeros

Column BY (Traitment Comptable): Only CFH


If you spot any "#N/A" it means that the contract is still not reflected Swap Energy Matrix GDRIVE and it´s also not reflected in Hedge file:



The following actions for the "#N/A" are inside 3.5. I have new contracts for provision bookings


Due to the fact that the information you have inside "DDMMYYYY_NRoff_Final_DDMMYYYY" file is built manually by middle office, mistakes might occur. Please go to tab "Counterparty check" and refresh the pivot table. The filters applied will give you the names of all external counterparties, because, the company code information is blank:

Column BQ (Company Code): select only blanks

Column BJ (Settlement Type): select "Settlm"

Column BI (Settlement Exposure): don´t select zeros


If you see a Solvay company it means that the company code information is missing from the "DDMMYYYY_NRoff_Final_DDMMYYYY" file. You need to alert the risk/middle offices teams to update in DWISE the information missing. This can lead to wrong allocation of settlements and MtM. It is very important that they follow the topic before month end.


3.2.2. I check if we traded for a new affiliate

This task allow us to check if energy business has made any trading with a new Solvay entity. On tab "New trading companies" please refresh the pivot and take special attention to the trading date, because, you need to update the filter for the month being closed. You will find the following filters:


Column M (Trade Date): select only the month being closed has shown in the following print screen

Column BQ (Company Code): select all companies (except blanks)


Afterwards, you will have a result like this:


If you see an "#N/A" on column J (New companies?), this means that you have found a new company to include it in the Hedge file. The next course of action you may find it on chapter 3.6 I have a new affiliate to consider for posting

3.3. I check for new books and deal types in "DDMMYYYY_NRJoff_Final_DDMMYYYY"

It's important to understand that our accounting entries are influenced by the "Book" and "Deal types". Especially when we have specific deal types for each market (OtC or Exchange). In this chapter we will show you the relationship between these 3 factors and if you spot a new book or deal type we have to ask risk team what its concerned to.

For your information, the following print screens allow you to allocate which book or deal type is being considered in the accounting files:

Accounting file Arbitrage 

Book:

The deal types for Exchange are:

Forward Cleared / FUTURE-Power / PX FUTURE / PX Spot transaction / FUTURE

The deal types for OtC are:

CEE / OTC Forward / OTC-Swap / PROFILED DEAL


Accounting file Asset management 03rd parties

Book:

The deal types for Exchange are:

Forward Cleared / FUTURE-Power /  FUTURE

The deal types for OtC are:

CAPA / FORMULA PROFILED DEAL / OTC forward / PROFILED DEAL


Accounting file Italia trade file

Book:

The deal types for Exchange are:

FUTURE-Power

We only have deal types for OtC:

FORMULA PROFILED DEAL / FORWARD / OTC forward / PROFILED DEAL


Accounting file Trade

Book:


The deal types for Exchange are:

FUTURE-Power / Forward Cleared / Future / PX Future


The deal types for OtC are:

CAPA / FEES / FORMULA PROFILED DEAL / FORWARD / OTC forward / OTC-Swap / PROFILED DEAL


Accounting file Hedge

Book:


The deal types for Exchange are:

Forward Cleared / FUTURE-Power / Future


The Deal types for OtC are:

CAPA / FORMULA PROFILED DEAL / FORWARD / OTC forward / OTC-SWAP / PROFILED DEAL


Inside file "NRJoff_Month end check_D-2" tab "New books or deal types" you will find:


Column "C" (Check if the deal types being considered in the formulas in your accounting files)

The formulas are conditioned by the exchange deal types, in this column, we just need to look at exchange deals types and you can disconsider the OtC. If you spot an #N/A with market type Exchange, this means, that you are not considering the deal type in your formulas from the accounting files.

The next steps are inside chapter 3.7 of procedure "I prepare the accounting files D-1"


Column "D" (Check for new deal types)

If you spot an #N/A, it means that its a new deal type. If you don´t have further details, you need to contact Risk team to know if the deal type is from market exchange or OtC.

In case is OtC, update the list on this file in columns K and L. Where "K" is the deal type and "L" is the market type.

In case is Exchange:
1- Update the list on this file in columns K and L. Where "K" is the deal type and "L" is the market type;
2- Update columns "F", "G" and "H" respectively where the new deal type appeared (Hedge file, Italia, Trade, Arbitrage or Asset Management);
3 -Update the formulas inside the accounting file. The next steps are inside 3.7. I have a new book or a new relationship deal type/market


3.4. I check file "DDMMYYYY-CO2_off_Final"

Please go to the previous month folder and copy paste the file "CO2 off_Month end check_D-2" named to the current month´s folder. You will find  tabs. To update the tab "Master data CO2 Official" please copy paste values+format from excel file "DDMMYYYY-CO2_off_Final" tab "Analysis". 


3.4.1 I check the transfer deals in CO2 official


In tab "Transfers check" we are checking the back-to-back deals, however, in this case risk team does not check beforehand. You will find a pivot table that you need to refresh and the filters are:

Filter

Risk date => After today

Counterpart => Transfer

Row labels

Book | Commodity | Market 

Values

Sum of Quantity


In the example showed we can see that no back-to-back deal is missing. In case that we detect a discrepancy Risk team needs to be aware and they should investigate and correct before the month end.

3.4.2 I check for new books and deal types in CO2 official

In tab "Category check" we investigate if we find any deal types allocated wrongly. For categories "Listed" and "Cleared" you should only find quantities or MtM amounts for deals types related to exchange market. For category "OtC" you should only find quantities or MtM amounts for deals types related to OtC market.

You will find a pivot table that needs to be refreshed with the following details:

Filter Risk Date with "After today" and "Today" (sometimes it may appear).

Category = Cleared/Listed → ICE Market

Deal types:

Forward Cleared / Future / Option Cleared (Quotation of the premium) / Spot Cleared / Spot Listed


Category = OtC → OtC Market

Deal Types:

Swap / Forward / Spot / Option



In this case everything is ok however, if you look at March 2020 period you will find a mistake where energy business allocated the categories wrongly. They corrected the situation by allocating the deals from "Forward cleared" to "Forward" or "Swap".


End of document.