In response to member feedback, we have introduced enhancements to the Financial Settlement Summary (FSS) that will provide a more intuitive experience for practitioners and financial institutions, with the new functionality helping to assist with the calculations required to populate these fields within the workspace.
UPDATED: 10 August 2021
We’re pleased to announce that the Auto-calculation of Vendor Surplus feature is available when you’re in a Workspace in the roles of Proprietor on Title and Mortgagee on Title.
The introduction of auto calculation of vendor surplus in the Settlement Summary screen aims to alleviate re-work for the practitioner and banks when they are responsible for handling the vendor’s surplus funds.
As a practitioner or bank, you can set up a vendor funds destination line item to automatically calculate and adjust. Turn this on and remove any re-work as financial line items are added or edited at the last minute. No more final adjustments to vendor surplus amounts and re-signings - it will be done automatically for you.
Your Subscriber Manager must activate this feature for you before you can use it. For information on how to activate this feature, see the following help articles:
Auto-calculation of vendor surplus - Proprietor on Title
Auto-calculation of vendor surplus - Mortgagee on Title
Functionality overview
- Introduction
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The Financial Settlement Summary tab has been redesigned to reduce friction so that you can experience a simpler, more streamlined way to completing the financial settlement schedule.
As part of the redesign, you’ll notice a revamped interface that includes new features and panels. We have also introduced some calculations enabling practitioners and financial institutions to easily enter funds and complete the financial settlement schedule with more accuracy and less dependency.
Key summary of changes
- A complete view of settlement funds
- New Transfer Indicators panel
- Balance due to Vendor
- System calculations
- Other improvements
A complete view of settlement funds
One of the notable improvements in the Financial Settlement Summary tab is the way the funds are displayed and laid out. There is a clear, side-by-side categorisation and itemised view of funds for both the incoming and outgoing parties, which replicates a balance sheet.
The Financial Settlement Summary gives you a complete picture of the purchaser’s and vendor’s funds, all on a single screen. The specific breakdown of funds in each category for each party gives everyone in the Workspace greater transparency on the settlement funds.
Information that is specific to your role will be automatically expanded, whilst items that belong to the other party will be automatically collapsed. To view or hide the itemised funds, you can expand or collapse the panels.
New Transfer Indicators panel
A new Transfer Indicators panel provides a summary view of all key tasks that relate to the financial settlement in the Workspace, giving you greater transparency over key responsibilities for Workspace parties.
The two new features in this panel include the ability to:
- View who will be directing the vendor’s surplus funds. Either the Proprietor on Title or Mortgagee on Title can assign responsibility for this task to themselves.
- View if the Balance due to Vendor* amount has been agreed by participants in the role of Incoming Proprietor and Proprietor on Title.
* Note: In this release notes, we’re referencing this amount as the ‘Balance due to Vendor’; however, the terminology differs in each jurisdiction:
- NSW—Amount due on Settlement
- VIC—Balance due to Vendor
- QLD—Balance due to Vendor
- SA—Balance due to Vendor by Purchaser
- WA—Balance due to effect Settlement
- ACT—Amount due to Seller
Balance due to Vendor
New to the Financial Settlement Summary tab is the mandatory Balance due to Vendor* amount. This is calculated by the purchase price, minus deposit paid, plus/minus net adjustments.
This figure is agreed by both the Proprietor on Title and Incoming Proprietor outside of the PEXA Workspace.
Either participant will have the ability to enter this amount into the PEXA Workspace. Providing the Balance due to Vendor into the Workspace provides PEXA the ability to:
- Clearly indicate to all participants the amount of funds available for the Vendor to disburse, and
- Use this figure to drive the Purchaser Funds Required to Settlement calculation (previously the Total Funds Required to Settle).
* Note: In this release notes, we’re referencing this amount as the ‘Balance due to Vendor’; however, the terminology differs in each jurisdiction:
- NSW—Amount due on Settlement
- ACT—Amount due to Seller
- VIC—Balance due to Vendor
- QLD—Balance due to Vendor
- SA—Balance due to Vendor by Purchaser
- WA—Balance due to effect Settlement
System calculations
As part of the enhancements to the Financial Settlement Summary, PEXA will calculate the vendor’s surplus, purchaser’s shortfall, and purchaser funds required to settle based on the line items entered by all participants and the Balance due to Vendor.
These calculated figures result in a more streamlined experience by providing a consistent way of calculating the vendor’s surplus funds and the funds required to settle by the purchaser.
Vendor’s funds:
- Previously, the Mortgagee on Title and Proprietor on Title would initiate a Workspace Conversation where the outgoing Financial Institution was to collect all funds from settlement to confirm the amount to be disbursed. In the new Financial Settlement Summary, the surplus amount is calculated by the system and agreed by the Practitioner, and the Mortgagee on Title is prompted to add the surplus amount into the Financial Settlement Schedule..
- The Unallocated Funds amount represents the remaining funds available to be disbursed to the Vendor. When the Proprietor on Title has completed entry of the Vendor’s line items, the Unallocated Funds calculation provides the Mortgagee on Title a clear indication of the remaining funds available. Once the Mortgagee on Title creates the loan payout(s) required, then the Unallocated Funds will be the amount required to be disbursed to the Vendor’s nominated account.
Purchaser funds required to settle:
- Previously, the Incoming Proprietor had to manually calculate the Total Funds Required to Settle and enter this value into the PEXA Workspace.
- Now, the Purchaser Funds Required to Settle (previously Total Funds Required to Settle) amount is now calculated by the system as the sum of the Balance Due to Vendor amount + Purchaser Payment Directions amount. When the Incoming Proprietor has completed entry of the Purchaser’s line items, the Purchaser funds required to settle will be the amount required by the Incoming Mortgagee.
Note: The system calculations are only available where there is a single Transfer, no more than one Discharge, and/or no more than one Mortgage in the Lodgement Case. In scenarios where there is more than one Transfer, Discharge, or Mortgage document within the same Workspace, PEXA is unable to determine the nature of the transaction. Therefore, the Incoming Proprietor is required to manually calculate and enter the Total Funds Required to Settlement amount into the Workspace.
Other improvements
Signing Status
The improved Settlement Signing Status panel now clearly shows the signing status of each participant in the Workspace. Adding the signing status provides more meaningful context where dual signatures are required (visible only to the Subscriber who has dual signing enabled).
Completing line items
Participants in the role of Incoming Proprietor are required to click the Ready for shortfall button (where the Incoming Mortgagee is handling shortfall) after they have completed entering their line items. This notifies the Incoming Mortgagee via a task and an on-screen button that they may now enter or update the shortfall amount.
Participants in the role of Proprietor on Title are required to click the Ready for surplus button (where the Mortgagee on Title is handling surplus) after they have completed entering their line items. This notifies the Mortgagee on Title via a task and an on-screen button that they may now enter or update the surplus amount.
Entering shortfall amount
If the Incoming Proprietor is responsible for providing shortfall funds, a button will appear on the Purchaser Funds panel, enabling them to either:
- Add as shortfall where the Purchaser’s Equity line item has not been created, or
- Update shortfall where an existing Purchaser’s Equity line item already exists.
When they click this button, they’ll be directed to the Add/Edit source line item entry screen with the shortfall amount pre-populated based on the new calculations built by PEXA.
Similarly, if the Incoming Mortgagee is handling shortfall, they will be presented with a task and either button above, after the Incoming Proprietor has clicked Ready for shortfall.
Entering surplus amount
If the Proprietor on Title is responsible for directing the vendor surplus funds, a button will appear on the Vendor Funds panel, enabling them to either:
- Add as vendor surplus where the Vendor’s Funds line item has not been created, or
- Update vendor surplus where an existing Vendor’s Funds line item already exists.
When they click this button, they’ll be directed to the Add/Edit Destination line item entry screen with the surplus amount pre-populated based on the new calculations built by PEXA.
Similarly, if the Mortgagee on Title is handling surplus funds, they will be presented with a task and either button above, after the Proprietor on Title has clicked Ready for surplus.
More details will come over the coming days, but in the meantime, please visit the Enhanced Settlement Summary site to learn more about this feature or join the pilot group.
New setting to indicate if transaction is a Sale or Purchase
To change this setting, open up a Workspace then navigate to Workspace Settings > Transaction Settings then click Edit.
Ability for Mortgagee on Title to assign surplus handing
Set up surplus handling
- Navigate to Administration Tools > Manage Subscriber Details.
- Scroll down to the Surplus Handling section and select one option:
Field
Description
Allow me to handle surplus using the “Assign to me” option
The Mortgagee on Title selects this option when they want the ‘assign to me’ feature available for all Workspaces.
(Click image to enlarge)
Display a message to other subscribers that I do not normally handle surplus, but retain the option to “Assign to me”
The Mortgagee on Title selects this option when they do not normally handle surplus, however, they may want the option to overwrite this in the Workspace.
I do not wish to handle surplus. Display a message to other subscribers , and remove the option to “Assign to me”
The Mortgagee on Title selects this option when they do not handle surplus in any Workspace. Choosing this option displays the below banner.
(Click image to enlarge)
- Save the changes.
- Navigating the Financial Settlement Summary tab
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The Financial Settlement Summary tab has been redesigned to reduce friction so that you can experience a simpler, more streamlined way to completing the financial settlement schedule.
As part of the redesign, you’ll notice a revamped interface that includes new features and panels. We have also introduced some calculations enabling practitioners and financial institutions to easily enter funds and complete the financial settlement schedule with more accuracy and less dependency.
Here's a closer look:
- New icons have been added to make it easier for you to visually ascertain the status of the financial settlement schedule.
- Information that is specific to your role is automatically expanded, whilst items that belong to the other party are automatically collapsed so you can focus on your tasks.
- Tasks that are applicable to your role are highlighted in yellow to draw attention to what's relevant to you.
1. Funds balance bar
A new bar with a visual indicator enabling you to quickly see if the purchaser’s and vendor’s funds are balanced.
2. Transfer Indicators panel
A new panel showing a summary of key indicators that relate to the financial settlement in the Workspace, giving you greater transparency over key responsibilities for Workspace participants.
3. Purchaser summary column
A new column showing the amounts payable by the purchaser. It shows all purchaser related line items on one screen and comprises of two panels:
- 3a—Purchaser Funds: Shows a high-level breakdown of funds required from the purchaser to settle the transaction.
- 3b—Purchaser Line Items: Shows a detailed breakdown of the purchaser’s funds.
4. Vendor summary column
A new column showing the amounts payable by the vendor. It shows all vendor related line items on one screen and comprises of two panels:
- 4a—Vendor Funds: Shows a high-level breakdown of funds required from the vendor to settle the transaction.
- 4b—Vendor Line Items: Shows a detailed breakdown of the vendor’s funds.
5. Stamp Duty panel
The Stamp Duty panel (or Transfer Duty panel in QLD and WA) shows the stamp duty status within the Workspace.
Note: This panel does not display in an ACT Workspace as Stamp Duty is not applicable in ACT.
6. Settlement Signing Status
An improved settlement signing panel that incorporates new icons to show the signing status of each participant in the Workspace.
- FUNDS BALANCE bar
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A new bar giving you a quick visual indicator of the purchaser’s and vendor’s balance of funds.
Funds balance bar
These figures in this bar represent the sum of the Sources and the Payment Directions, based on the line items entered for Sources and Destinations/Adjustments and Payments. When the funds are balanced, the bar will turn green.
Print function (NEW)
A new function enabling you to conveniently print the settlement summary so you can share it with your client as a document. Details such as key Workspace data and an outline of the purchaser and vendor funds are included in the document; whilst the Stamp Duty and Settlement Signing Status panels are excluded from the printed document.
- TRANSFER INDICATORS PANEL
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This new panel shows key indicators that relate to the financial settlement in the Workspace, giving you greater transparency over key responsibilities for Workspace participants.
a. Indicates if loan documents have been received
The Incoming Mortgagee indicates if they have received the loan documents.
b. Identifies who is providing the shortfall
The Incoming Mortgagee selects who will be responsible for providing the shortfall amount.
c. Displays the last four digits of the purchaser's account
As an identifier, the last four digits of the purchaser’s account is displayed. Entering the last four digits is optional and the FSS can be saved without this information.
d. Indicates if discharge authority has been received
The Mortgagee on Title indicates if they have received the discharge authority.
e. Identifies who is directing the vendor surplus (NEW)
The Mortgagee on Title or Proprietor on Title assigns responsibility for who will be directing the vendor surplus. Either participant can assign responsibility of this task to themselves.
f. Displays the Balance due to Vendor status (NEW)
Shows the status of the Balance due to Vendor* amount.
- Pending – No amount has been entered (default status).
- Pending Others – An amount has been entered by the Incoming Proprietors or Proprietors on Title in the Workspace but has not been confirmed by all Incoming Proprietors and Proprietors on Title.
Note: This status is displayed to participants in the role of Incoming Mortgagee or Mortgagee on Title as they are not required to action this task. - Agreed – The amount entered has been confirmed by all Incoming Proprietor and Proprietor on Title participants either via a confirmation dialog in the Workspace or by signing the financial settlement schedule.
*This terminology differs based on your jurisdiction:
- NSW—Amount due on Settlement
- VIC—Balance due to Vendor
- QLD—Balance due to Vendor
- SA—Balance due to Vendor by Purchaser
- WA—Balance due to effect Settlement
- ACT—Amount due to Seller
- Pending – No amount has been entered (default status).
- PURCHASER summary column
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The Purchaser Summary column is new to the Financial Settlement Summary and shows the amounts payable by the purchaser; as line items are added or edited and saved, this panel is updated upon refreshing the page. This column consists of two panels: Purchaser Funds and Purchaser Line Items, and will auto-expand for participants in the role of Incoming Proprietor or Incoming Mortgagee.
Purchaser Summary column
Purchaser Funds
Displays a high-level breakdown of funds required from the purchaser to settle the transaction. These amounts are calculated based on the line items and the Balance due to vendor entered.
- Balance due to Vendor
An agreed amount (between the Proprietor on Title and Incoming Proprietor) that the vendor will receive from the purchaser. This is calculated by purchase price, minus deposit paid, plus/minus net adjustments. This amount is entered by either the Proprietor on Title or Incoming Proprietor. - Purchaser Payment Directions
This amount represents the sum of destinations/disbursements. - Purchaser funds required to settle
The amount required by the Incoming Mortgagee for settlement. Previously known as the ‘Total funds required to settle’, this amount is now calculated by the system as a sum of the Balance due to Vendor amount + Purchaser Payment Directions amount. - Incoming Mortgagee Sources
The funds disbursed by the Incoming Mortgagee, such as a loan proceeds.
Purchaser Line Items
Displays a detailed breakdown of the purchaser’s funds, as per line items entered in the Sources and Destinations/Payments and Adjustments tabs.
Buttons on the purchaser's panels
Depending on who is assigned responsibility for providing the shortfall funds, the buttons available on these panels will vary according to your role.
Incoming Proprietor is responsible for providing shortfall
This view displays to participants in the role of Incoming Proprietor if they are responsible for providing the shortfall.
In this scenario, the Incoming Proprietor:
- Clicks Mark as Complete (1) after they have completed entering all their line items.
- Clicks on Add as shortfall (2) and they will be directed to the Add/Edit Source line item entry screen with the shortfall amount pre-populated based on the new calculations built by PEXA.
Note: If the Incoming Proprietor has previously entered a shortfall amount and source amounts changes, they will see an Update shortfall button here instead.
Incoming Mortgagee is responsible for providing shortfall
This view displays to participants in the role of Incoming Proprietor if the Incoming Mortgagee is responsible for providing the shortfall.
In this scenario, the Incoming Proprietor clicks the Ready for shortfall button to finalise entering their line items. This notifies the Incoming Mortgagee that they may now enter or update the shortfall amount.
Incoming Mortgagee is responsible for providing shortfall
This view displays to participants in the role of Incoming Mortgagee if they are responsible for providing the shortfall.
In this scenario, the Add as shortfall button displays to the Incoming Mortgagee after the Incoming Proprietor finalises their line items and has clicked Ready for Shortfall. The Incoming Mortgagee clicks the Add as shortfall button to enter or update the shortfall amount.
- Balance due to Vendor
- VENDOR summary column
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The Vendor Summary column is new to the Financial Settlement Summary and shows the amounts payable by the vendor; as line items are added or edited and saved, this panel is updated upon refreshing the page. This column consists of two panels: Vendor Funds and Vendor Line Items and will auto-expand for participants in the role of Proprietor on Title or Mortgagee on Title.
Vendor Summary column
Vendor Funds
Displays a high-level breakdown of funds required from the vendor to settle the transaction.
- Balance due to Vendor
An agreed amount (between the Proprietor on Title and Incoming Proprietor) that the vendor will receive from the purchaser. This is calculated by purchase price, minus deposit paid, plus/minus net adjustments. This amount is entered by either the Proprietor on Title or Incoming Proprietor. - Proprietor on Title Destinations
This amount represents the sum of destinations/disbursements.
- Mortgagee on Title Destinations
This amount represents the funds disbursed by the Mortgagee on Title, such as a loan payout.
Vendor Line Items
Displays a detailed breakdown of the vendor's funds, as per line items entered in the Sources and Destinations/Adjustments tabs. The destination amounts here are used to calculate the Unallocated Funds on the Vendor Funds panel.
Buttons on the vendor's panels
Depending on who is directing the vendor surplus, the available buttons available on these panels will vary according to your role.
Proprietor on Title is responsible for directing vendor surplus
This view displays to participants in the role of Proprietor on Title if they are responsible for directing the vendor surplus.
In this scenario, the Proprietor on Title clicks on Add as vendor surplus and they will be directed to the Add/Edit Destination line item entry screen with the surplus amount pre-populated based on the new calculations built by PEXA.
NOTE: If the line items are updated and the surplus amount changes, this button changes to 'Update vendor surplus'.
Mortgagee on Title is responsible for directing vendor surplus
This view displays to participants in the role of Proprietor on Title if the Mortgagee on Title is responsible for directing the vendor surplus.
In this scenario, the Proprietor on Title clicks on Ready for surplus to finalise entering their line items. This notifies the Mortgagee on Title (via a task and an on-screen button) that they may now enter or update the surplus amount.
Mortgagee on Title is responsible for directing vendor surplus
This view displays to participants in the role of Mortgagee on Title if they are responsible for directing the vendor surplus.
In this scenario, the Add as vendor surplus button displays to the Mortgagee on Title after the Proprietor on Title has finalised their line items and clicked Ready for surplus. The Mortgagee on Title clicks the Add as vendor surplus button to enter or update the surplus amount.
Note: If a surplus amount has already been entered, the Mortgagee on Title will see an Update vendor surplus button here instead.
- Balance due to Vendor
- STAMP DUTY PANEL
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The Stamp Duty panel (or Transfer Duty panel in QLD and WA) shows the stamp duty verification and assessment status.
The Stamp Duty panel remains unchanged and displays the following information:
Document ID
A unique ID generated by PEXA for the Transfer document in the Workspace.
Verification Status
The duty amount payable has been verified to be correct via a stamp duty verification process in PEXA. The possible statuses are Successful or Unsuccessful.
OSR status advice
The status of the Stamp Duty case in the Revenue Office system.
Duty amount payable
The amount of duty payable for the property.
- SETTLEMENT SIGNING STATUS
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The Settlement Statement Signing panel has been improved to include new icons to visually indicate the signing status of each participant in the Workspace. This provides more meaningful context where dual signatures are required (visible only to the Subscriber who has dual signing enabled).
New icons
New icons have been added allowing you to visually ascertain a participant's signing status. When a participant successfully signs the financial settlement schedule, the icons for that participant turns green and a time stamp of when they signed will be recorded in the Date and time column.
FAQs
- Why is PEXA revamping the Financial Settlement Schedule (FSS)?
- PEXA is committed to continuously enhancing member experience – with your feedback playing a key role in driving our technical prioritisation.
Member feedback has indicated that the FSS is an area the network has wanted to see us innovate and streamline for some time now.
Ultimately, by delivering the enhancements to the network, our aim is to enable you to complete your required tasks on the day of settlement, without relying on other Workspace parties to first complete theirs – eliminating interdependencies and encouraging timely settlements.
- What is PEXA doing to support members through this change?
- We recognise this is a significant change to your PEXA experience. As such, we’ve developed an extensive suite of learning resources to help you navigate this change. Information on the rollout can be found here: https://www.pexa.com.au/sites/ess.
Full Release Notes on Part 1 can be found here: https://community.pexa.com.au/t5/PEXA-Product-Releases/PEXA-Release-12-1-2-05-October-2020/ba-p/2096....
Further material (help cards etc) can be found here: https://community.pexa.com.au/t5/Help-Centre/PEXA-s-Enhanced-Settlement-Schedule/ba-p/20958.
- What are the benefits of this for practitioners?
- As an Incoming Proprietor representative, practitioners will benefit from not having to calculate and enter the Total Funds Required to Settle (TFRS), have better co-ordination with the Incoming Mortgagee, see a reduction in keying of data and have less reliance on conversations to clarify responsibilities.
Where the Incoming Mortgagee is responsible for providing all funds, practitioners can generate a task to the bank to finalise their source funds required for settlement when they’ve completed entry of your line items.
Similarly, when acting for the Proprietor on Title, practitioners will have more visibility over key responsibilities in the Workspace and will also benefit from the system calculations for the Vendor Surplus line items. This should reduce the number of conversations with the client’s bank in the Workspace.
Where the Mortgagee on Title is responsible for the Vendor’s surplus, practitioners can generate a task to the bank to finalise the Vendor’s funds when they’ve completed entry of your line items.
- What are the benefits of this for financial institutions?
- Financial institutions will see a reduction in errors and more Workspace clarity, in addition to greater certainty over the final settlement figures, reduced reliance on conversations and greater visibility of the status of the completion of the FSS.
- What happens if my Workspace is uploaded via PEXA Projects?
- The Proprietor on Title does not need to enter or sign off on the Balance Due to Vendor. The Incoming Proprietor will be expected to enter this figure to drive the ‘Total Funds Required to Settle’ calculation, especially where the Incoming Mortgagee is handling shortfall funds. The ‘Ready for Surplus’ button will still be available for the Proprietor on Title to click (on a per workspace basis), however as the POT is usually in control of directing their own funds, then this shouldn’t be an issue.
- What if my dealing is a “non-sale" transfer, or a transfer where settlement is not requireD?
- The enhancements to the Financial Settlement Summary (FSS) aren't applicable for all PEXA transactions (like those with transfers between related parties, family law transactions, estate transfer, transmission to beneficiary or part tenancy transfers). To address this, we've built into a toggle option which enables you to indicate whether or not the transaction is a sale or purchase By default, when the FSS is live, members will have their Workspaces set to "Yes". This means the FSS calculations are enabled. If your transaction does not require the calculations in the FSS then go to Workspace Settings > Transaction Settings, then select No to “Is this transaction a sale or purchase”. The ESS will revert back to where the Incoming Proprietor has to manually calculate and enter the Total Funds Required to Settle (TFRS) amount into the Workspace.
- Why is this being delivered in stages?
- As with any change, we want to ensure the process causes minimal disruption to your organisation’s day-to-day operations. By rolling this out in stages, we hope this will make the changes as seamless as possible and enable us to quickly implement additional feedback from the network.
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