Letter of Guarantee and Letter of Credit Document Terms
A letter of guarantee moves several different amounts at once: the face value the bank commits to, the cash cover the bank holds back from your account, the fees it charges, and the share of your credit facility the letter uses up. Each of those amounts has its own pair of account sides on the term, so the term screen for these documents is long — but every pair answers the same question: for this amount, which account is debited and which is credited?
This page goes through the terms of the guarantee documents — issue, opening balance, changing and closing — and then the letter-of-credit terms that copy their shape. The documents themselves are on Letters of Guarantee and Letters of Credit.
Two kinds of side on these screens
Some pairs are a full account-side block — side configuration, account source, subsidiary type, narrations, dimension sources — described once in Anatomy of an Account Side. Others are a single reference field that points at an Accounting Side Config record. Below, a pair marked (record) is the second kind: you pick a saved side record rather than filling a block. A pair posts only when both its debit and its credit are filled in.
LG Issue
The issue document is where the letter's money first moves. Its term has one Effects tab and one Tax Effect tab.
| Group on screen | Field | What it books |
|---|---|---|
| LGT Amount Debit / Credit (record) | termConfig.lgtAmountDebit, termConfig.lgtAmountCredit | The letter's face value — taken from the letter of guarantee record itself, not from the issue document. This is the memo pair most customers point at off-balance-sheet commitment accounts. |
| Debit / Credit Facilities Amount (record) | termConfig.facilitiesDebit, termConfig.facilitiesCredit | The facilities amount on the document — the share of the bank facility the letter consumes. |
| Covering debit / credit | termConfig.coveringDebit, termConfig.coveringCredit | The covered amount: the cash the bank sets aside as margin against the letter. |
| Fess Debit / Fees Credit | termConfig.feesDebit, termConfig.feesCredit | The fees value on the document. |
| Issue Feeses Debit / Credit | termConfig.collectDebit1, termConfig.collectCredit1 | The issue fees on the document. |
| Guarantee Type | termConfig.guaranteeType | Not a side — see below. |
The covering groups' English title
On the English screen the two covering groups of the issue, opening and closing terms read Old Covering Debit and Old Covering Credit; the Arabic screen reads «مدين التغطية» / «دائن التغطية». On these documents they hold the current cover — there is no "old" cover on an issue.
Guarantee Type termConfig.guaranteeType ties the term to one kind of letter (bid bond, performance bond, advance payment…). When both the term and the document carry a type and the two differ, the document refuses to save with:
Guarantee Type in the Term and the Document must be the same
So one term per guarantee type is the usual setup: the bid-bond term can post to bid-bond accounts without anybody remembering to choose them.
The Tax Effect tab carries the tax on the bank's fees.
| Option | Field | What it does |
|---|---|---|
| Tax fees Debit 1 / Credit 1 (record) | termConfig.feesTax1Debit, termConfig.feesTax1Credit | Books the document's tax 1 value. |
| Tax fees Debit 2 / Credit 2 (record) | termConfig.feesTax2Debit, termConfig.feesTax2Credit | Books the document's tax 2 value. |
| Tax Plan | termConfig.taxPlan | The tax plan that fills the document's tax percentages for its legal entity and date. With no plan the percentages are set to zero. |
| Is Editable Tax | termConfig.isEditableTax | Left off, the percentages are reset from the tax plan every time the document is saved. Ticked, the user's own percentages are kept. |
LG Opening Document
The opening document loads letters that already existed before the company started on Nama, one line per letter, and each line can be a different guarantee type. So the term does not hold one set of sides — it holds a grid.
LGT Open Lines termConfig.lgtopenLines has one row per guarantee type, each with its own covering, fees and LG-value sides (…guaranteeType, …coveringDebit/…coveringCredit, …feesDebit/…feesCredit, …lgtValueDebit/…lgtValueCredit). For each line of the document the system finds the row whose guarantee type matches the line and posts:
- the line's covered amount on the row's covering sides,
- the line's fees value on the row's fees sides,
- the line's LG value on the row's LG-value sides.
Any side the matching row leaves empty falls back to the header groups above the grid: the covering groups (termConfig.coveringDebit/…Credit), Fees Debit / Old Fees Credit (termConfig.feesDebit/…Credit) and the two lGT Value groups (termConfig.loanValDebit/…Credit). A sensible setup puts the common accounts in the header and uses the grid only for the types that differ.
LG Changing
A change replaces the letter's cover and fees with new values, so the term needs a pair for the old amount and a pair for the new one.
| Group on screen | Field | What it books |
|---|---|---|
| LGT Amount Debit / Credit (record) | termConfig.lgtAmountDebit, …Credit | The letter's face value from the letter record. |
| Debit / Credit Facilities Amount (record) | termConfig.facilitiesDebit, …Credit | The facilities amount. |
| New Covering Debit / Credit | termConfig.coveringDebit, …Credit | The new covered amount. |
| Old Covering Debit / Credit | termConfig.interestValDebit, …Credit | The old covered amount. |
| New Fees Debit / Credit | termConfig.feesDebit, …Credit | The new fees value. |
| Fees Debit / Old Fees Credit | termConfig.issuedDebit, …Credit | The old fees value. |
| Change Fees Debit / Credit | termConfig.loanValDebit, …Credit | The change fees the bank charges for the amendment. |
| Guarantee Type | termConfig.guaranteeType | The same type check as on the issue term, with the same message. |
| Shorten Ledger Effect | termConfig.shortenLedgerEffect | Merges ledger lines that share the same account, dimensions and narration into one. |
Old amounts post in the same direction as new ones
The old-amount pairs are posted exactly as their debit and credit are set, the same way the new-amount pairs are. Nothing reverses them for you. To release the old cover and take the new one, set the Old Covering pair with its accounts the other way round from New Covering — debit the account the issue credited, and credit the account the issue debited. The same goes for the old and new fees.
The Tax Effect tab carries the same tax 1 and tax 2 pairs, Tax Plan and Is Editable Tax as the issue term. On this screen the tax 1 pair sits in the first tax group and the tax 2 pair in the second.
LG Closing
A letter ends in one of three ways, and the closing document's status decides which pair of sides posts the covered amount:
| Status | Group on screen | Field |
|---|---|---|
| Finished | Closed Debit / Credit | termConfig.closedDebit, termConfig.closedCredit |
| Canceled | Cancel Debit / Credit | termConfig.cancelDebit, termConfig.cancelCredit |
| Liquidated | Liquied Debit / Liquied credit | termConfig.liquidDebit, termConfig.liquidCredit |
Liquidation is the case where the beneficiary called the guarantee and the bank paid out of the cover; that is why it has its own pair, usually crediting the cover account and debiting an expense or a claim on the customer.
The rest of the closing term:
| Group on screen | Field | What it books |
|---|---|---|
| LGT Amount Debit / Credit | termConfig.lgtAmountDebit, …Credit | The letter's value on the closing document — typically the reverse of the issue's face-value pair, to clear the commitment. |
| Debit / Credit Facilities Amount (record) | termConfig.facilitiesDebit, …Credit | The facilities amount released. |
| Fees Value Debit / Credit | termConfig.feesDebit, …Credit | The LGT Closing Fees on the document. |
| Guarantee Type | termConfig.guaranteeType | The same type check as the issue term. |
Letter of credit terms
The letter-of-credit documents copy the guarantee terms almost field for field, with Bank LC in place of LGT.
Bank LC Opening is laid out like the LG issue term: facilities, covering, fees (Fess Debit / Fees Credit), issue fees (Issue Feeses Debit / Credit) and the Tax Effect tab with tax 1 and tax 2, Tax Plan and Is Editable Tax. The amounts come from the opening document in the same way, and are always posted in the legal entity's main currency.
Bank LC Closing is laid out like the LG closing term: Closed, Cancel and Liquied pairs chosen by the document's status, Bank LC Amount Debit / Credit (termConfig.blcAmountDebit, …Credit) for the credit's value, the facilities pair, and Fees Value Debit / Credit for the Bank LC Closing Fees. Its Guarantee TypetermConfig.guaranteeType is compared with the document's LC type, and a mismatch refuses the save with:
Bank LC Type in the Term and the Document must be the same
Messages you may see
| Message | Why | What to do |
|---|---|---|
| Guarantee Type in the Term and the Document must be the same — «لابد من تشابه نوع الضمان في المستند وتوجيه المستند» | The guarantee document and its term both carry a guarantee type, and they differ. | Choose the term made for this guarantee type, or clear the type on the term if it should serve every type. |
| Bank LC Type in the Term and the Document must be the same — «لابد من تشابه نوع الاعتماد في المستند وتوجيه المستند» | On a letter-of-credit closing, the term's type and the document's LC type differ. | Choose the matching term, or clear the type on the term. |