Introduction xvii Acknowledgements xxi About the Authors xxiii PART I INTRODUCTORY ELEMENTS 1 1 Basic Corporate Action Concepts 3 2 Event Description and Classification 9 3 The Securities (and Corporate Actions) Market Place 23 4 Static Data 37 5 Securities Position Management 49 PART II MANDATORY EVENTS 57 6 Overview of the Generic Corporate Action Lifecycle 59 7 Straight Through Processing 63 8 Event Terms Capture and Cleansing 67 9 Determining Entitlement 79 10 Communication of Event Information 113 11 Calculation of Resultant Entitlements 123 12 Passing of Internal Entries 139 13 Collection/Disbursement of Resultant Entitlements 151 14 Updating of Internal Entries 161 15 Examples of Mandatory Events 167 PART III EVENTS WITH ELECTIONS 185 16 Concepts of Events with Elections 187 17 Management of Mandatory with Options Events 193 18 Management of Voluntary Events 219 PART IV MULTI-STAGE EVENTS 233 19 Concepts of Multi-Stage Events 235 20 Management of a Rights Issue 247 21 Example of a Rights Issue 261 22 Concepts of Takeover Events 275 23 Management of Takeover Events 285 PART V TAXATION 299 24 Concepts and Management of Taxation 301 25 Management of Income Tax 307 PART VI ISSUER NOTICES 331 26 Concepts and Management of Issuer Notices 333 PART VII OBJECTIVES AND INITIATIVES 341 27 Objectives and Initiatives 343 Glossary of Terms 353 Index 383
MICHAEL SIMMONS has spent the majority of his working life within the operational areas of international investment banks, most notably within the S.G. Warburg group in London. Having gained a detailed understanding of various back office tasks through many years of hands-on experience, he assumed managerial responsibility for a number of operational areas. In recent years, Michael has worked as head of business consultancy within a global computing services firm, and is now an independent analyst and trainer. Michael?s areas of expertise include all aspects of the fixed income and equity trade lifecycle and related activities, including operational risks and controls. Recent assignments include the offshoring of operational activities to India and operational risk analysis (the Sarbanes Oxley act). In addition, he creates and delivers training courses on the workings of the securities industry and associated operational aspects to audiences around the world. Michael is author of Securities Operations: A Guide to Trade and Position Management published by John Wiley & Sons, which describes the fundamental components of operational activities from a first-principles perspective. ELAINE DALGLEISH has spent her working life within the operational areas of investment banking and stock broking, working directly for international banking firms and financial software providers. Elaine?s hands-on experience spans various middle and back office operational disciplines in multiple markets. Whilst working directly in investment banking and stock broking, this has ultimately included the managerial responsibility for a number of operational areas. The focal point of Elaine?s working history is the consistent involvement with Corporate Actions operations, initially with the manual processing of events as a custodian, and subsequently working as a Senior Business Analyst, specialising in Corporate Actions, analysing client requirements, and consulting in process re-engineering for Tier 1 and 2 investment banks. As a consequence, Elaine has both observed and been directly involved in the evolution of global market practices of Corporate Actions operations and the move to automation.