Introduction to Soft Accounting

With the advent of Arrangement Architecture (AA), Temenos Transact introduced soft accounting. Prior to AA, Asset Types (Balance Types) were hard-coded, which is still used by non-AA modules.

Soft Accounting introduced rules based accounting and is extensively used by the Arrangement Architecture modules. The arrangements are comprised of a series of balances that can be defined by product type. As a result, the accounting process is extremely flexible to reflect the rules of the underlying products. Balance types represent the financial components of a product, where the definition of the product specifies which balance types the product should be comprised of.