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Lines A1c and A2 Transaction Accounts What is a transaction account? Transfers or Withdrawals through: ATMs Checks Debit Cards Unlimited amount of transactions Transaction Accounts Always regarded as transaction accounts: Demand Deposits NOW Accounts Share Draft Accounts

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transaction accounts
Transaction Accounts
  • What is a transaction account?
    • Transfers or Withdrawals through:
      • ATMs
      • Checks
      • Debit Cards
    • Unlimited amount of transactions
transaction accounts3
Transaction Accounts
  • Always regarded as transaction accounts:
    • Demand Deposits
    • NOW Accounts
    • Share Draft Accounts
    • ATS (automatic transfer service) Accounts
line a1c other demand deposits
Line A1C (Other Demand Deposits)
  • Include deposits held for :
      • Individuals, Partnerships, Corporations, State & Local Governments
      • Foreign Governments and International Institutions
      • US Government Agencies
line a1c other demand deposits5
Line A1C (Other Demand Deposits)
  • Include:
    • Official Checks
      • Cashier’s Checks
      • Teller’s Checks
      • Money Orders
      • Traveler’s Checks or Teller’s Checks whose funds have not cleared
line a1c other demand deposits6
Line A1C (Other Demand Deposits)
  • Primary Obligations
    • Mature/Demandable in less than 7 days
  • Money Orders drawn on the bank and outstanding on the report date
  • Unposted Credits
  • Suspense Accounts
line a1c other demand deposits7
Line A1C (Other Demand Deposits)
  • Escrow Accounts
    • Withdrawn within 6 days from date of deposit
  • Not qualifying non-transaction accounts
    • Time deposits
      • Early withdrawal
      • Matured
    • Savings accounts which allow transaction limits to be exceeded
line a1c other demand deposits8
Line A1C (Other Demand Deposits)
  • Exclude:
    • Escrow Funds held in DI’s Trust Department
    • Overdrawn Accounts (report as zero)
    • Deposits due to Depository Institutions (A1a)
    • Deposits due to U.S. Government (A1b)
    • Savings Deposits (C1)
    • Time Deposits (D1/F1)
line a1c other demand deposits9
Line A1C (Other Demand Deposits)
  • Common reporting errors:
    • Reporting Overdrawn Accounts
    • Failure to report
      • Unposted Credits
      • Suspense Accounts
      • Official Checks
line a2 ats now share drafts and telephone and preauthorized transfers11
Line A2 (ATS, NOW/Share Drafts, and Telephone and Preauthorized transfers)
  • Include:
    • Interest Bearing Checking Accounts (NOW)
    • Automatic Transfer Service Accounts (ATS)
    • Telephone and Preauthorized Transfer Accounts
    • Share Drafts (for Credit Unions)
  • Meet the definition of a time deposit
    • Allow payments to be made by third-parties
      • Debit Cards
      • ATM’s
      • Remote Service Unit
line a2 ats now share drafts and telephone and preauthorized transfers12
Eligible to hold NOW accounts:

Individuals or Sole Proprietorships

Nonprofit Organizations

Domestic Government Units

IOLTA

Line A2 (ATS, NOW/Share Drafts, and Telephone and Preauthorized transfers)
line a2 ats now share drafts and telephone and preauthorized transfers13
Line A2 (ATS, NOW/Share Drafts, and Telephone and Preauthorized transfers)
  • Automatic Transfer Service Accounts (ATS)
    • Overdraft protection
    • Automatic payments to reporting institution
    • Transfers made to an account to cover checks or drafts drawn on the reporting institution
    • Transfers made to maintain a minimum account balance
line a2 ats now share drafts and telephone and preauthorized transfers14
Line A2 (ATS, NOW/Share Drafts, and Telephone and Preauthorized transfers)
  • Telephone and Preauthorized Transfers
    • Oral or Written Arrangement
    • Unlimited Withdrawals
    • Predetermined Time or on a Fixed Schedule
      • Example: Automatic bill payment services offered by the reporting institution.
line a2 ats now share drafts and telephone and preauthorized transfers15
Line A2 (ATS, NOW/Share Drafts, and Telephone and Preauthorized transfers)
  • Share Draft Accounts
    • Interest and Non-Interest bearing accounts
    • Withdrawable on demand
    • Credit Union reserves the right to require up to 60 days prior notice of withdrawal
line a2 ats now share drafts and telephone and preauthorized transfers16
Line A2 (ATS, NOW/Share Drafts, and Telephone and Preauthorized transfers)
  • Common reporting errors:
    • Including ineligible non-personal accounts
    • Including transaction accounts that do not require advance written notice of withdrawal
    • Incorrect GL mapping into/out of A2
line a2 ats now share drafts and telephone and preauthorized transfers17
Line A2 (ATS, NOW/Share Drafts, and Telephone and Preauthorized transfers)

IMPORTANT

Account terms and disclosures must state that the institution reserves the right to require 7 days advance written notice of withdrawal. While these rights may not be exercised, not having them in the terms disqualifies them from being included in line A2.

where do these accounts go
Where do these accounts go?

Line Item

Account Holder

A2

IOLTA Checking Account

A1c

Quality Inc. Checking Account

Jane Doe’s overdrawn checking account

A1c/A2

Girl Scouts interest bearing checking account

A2

Lisa’s share draft account at ZY Credit Union

A2

things to consider
Things To Consider

Interest Bearing/

Non-Interest Bearing

Advance Notice of Withdrawal

Account Disclosures/Terms

Line A1c or Line A2

Type of Financial

Institution

Account Holder

General Ledger

legitimate differences commercial banks
Legitimate DifferencesCommercial Banks
  • FR2900>FFIEC031/041
    • Primary Obligations
    • Teller Checks
    • Commingled Trust Accounts
legitimate differences savings and loans
Legitimate DifferencesSavings and Loans
  • FR2900>OTS 1313
    • Primary Obligations
    • Tellers Checks
  • FR2900<OTS 1313
    • 2900 excludes escrow accounts that DI keeps properly segregated as trust funds.
legitimate differences credit unions
Legitimate DifferencesCredit Unions
  • FR2900>NCUA 5300
    • Share Draft accounts that exceed transaction limits or are not monitored
  • FR2900<NCUA 5300
    • 2900 excludes balances at non-US branches of the credit union
lines a1c and a223
Lines A1C and A2

Questions????