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F ED ER A L R E S E R V E B A N K OF D A L L A S
Station K, Dallas, Texas 7 5 2 2 2

Circular No. 84-91
August 27, 1984

TO:

All depository
Reserve District.

ATTENTION:

Operations Officer/Reserve Account Manager

SUBJECT:

Policies in issuing and applying "as-of“ adjustments

SUMMARY:

Effective October 11, 1984, all Federal Reserve Banks
will
implement
uniform policies in issuing and
applying adjustments to reserve and clearing accounts
held for depository institutions.

ATTACHMENTS:

Letter from the Federal Reserve Bank of Dallas' First
Vice President, William H. Wallace regarding policies
on "as-of" adjustments

MORE INFORMATION:

Robert
Feil,
Extension 6132

ADDITIONAL COPIES:

Public Affairs Department, Extension 6289

institutions

Extension

in the Eleventh Federal

6690

or

Evelyn

Thomas,

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)
Banks and others are encouraged to use the follow ing incom ing WATS numbers in contacting this Bank: 1-800-442-/140
(intrastate) and 1-800-52/-9200 (interstate). For calls placed locally, please use 651 plus the extension reterred to above.

FED E R A L R E S E R V E B A N K OF D A L L A S
Station K, Dallas, Texas 7 5 2 2 2

August 20, 1984

To:

Depository Institutions Maintaining Accounts
at the Federal Reserve:

Effective October 11, 1984, all Federal Reserve Banks will implement
uniform policies in issuing and applying adjustments to reserve and clearing
accounts held for depository institutions. Such adjustments are commonly
referred to as "as-of" adjustments and are made to correct the cumulative
effect of errors made either by Reserve Banks or by depository institutions,
or to compensate the Federal Reserve for float incurred.
In addition to
achieving more uniformity among Reserve Banks, implementation of these
policies is intended to minimize the effect of these adjustments on the
overall availability of total reserves. Following is a description of the
"as-of" adjustment policies that will be followed by all Reserve Banks.
General Provisions
When the Reserve Banks make "as-of" adjustments for depository
institutions, the effect is to either increase or decrease the cumulative
amount of balances held with the Federal Reserve to meet reserve or clearing
balance requirements. Generally, adjustments to correct for transactionrelated errors will be made only when the original transaction amount is
$10,000 or more. This minimum is applied because the cost of making an
adjustment for less than this would exceed the value of the adjustment. In
cases where offsetting "as-of" adjustments are to be made to the accounts of
two depository institutions, the adjustments ordinarily will be applied
simultaneously. This is intended to avoid the impact that mismatched adjust­
ments would have on total reserve availability.
Adjustments for Transaction Errors
Errors made by Reserve Banks. In addition to correcting the under­
lying error by making a debit or credit accounting entry, the Reserve Bank
will also issue an "as-of" adjustment to correct the cumulative effect of the
error. Such adjustment will be limited to cover a maximum period of 45
calendar days from the date of the error to the date the depository
institution notifies the Reserve Bank. If, after notification, additional
time is required to resolve the error, the amount of the "as-of" adjustment
will be increased to cover this period. Depository institutions should review
their daily Fed statements on a timely basis to determine that all entries are
correct and notify the Reserve Bank promptly of any errors.

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2

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Errors made by depository institutions. In cases where both
depository institutions agree to accept offsetting adjustments in the same
reserve maintenance period, "as-of" adjustments may be made to correct errors
of record--for example, when a depository institution transfers funds to the
wrong institution. "As-of" adjustments generally will not be made to correct
errors of omission— for example, when a depository institution fails to
transfer funds to another institution--unless the circumstances involved are
clearly exceptional. "As-of" adjustments will not be issued to reverse the
effects of earlier "as-of" adjustments or to move excess reserves from one
reserve period to another.
Adjustments for Data Reporting Errors
Depository institutions submit to the Federal Reserve various deposit
reports. Any errors found in such reports should be corrected. Revised
reports should be submitted for all periods in error, back as far as six
months prior to the discovery of the error and forward until correction of the
error. If correction of the error changes the reserve balance requirements
for the depository institution, the Reserve Bank will issue "as-of" adjust­
ments. These adjustments will be applied only to future reserve maintenance
periods so that the depository institution will have advance notice of the
effect on its reserve position.
Holiday Variances Between Reserve Banks
In processing interdistrict cash letters, Federal Reserve System
policy provides that an "as-of" adjustment will be made to cover cash letter
credits when the Reserve Bank serving the receiving depository institution is
closed on a holiday that is not observed by the processing Reserve Bank. The
"as-of" adjustment ordinarily will be applied to the depository institution's
account in the current reserve maintenance period. However, when the holiday
occurs on Monday, Tuesday, or Wednesday of the second week of the maintenance
period, the "as-of" adjustment will be applied on the following Thursday--the
first day of the next period. This policy is intended to avoid the impact
such adjustments would otherwise have on the Federal Reserve's ability to
manage overall reserve availability near the end of a reserve maintenance
period.
Any questions you may have regarding the Federal Reserve's "as-of"
adjustment policies should be referred to Robert Feil, extension 6690 or
Evelyn Thomas, extension 6132.
Sincerely yours,


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102