1. Concepts and Terminology
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Version 3.0 |
1.1 Introduction
An OmniValue document consists of assets which are organized into portfolios which are owned by one owner. An asset consists of a number of identical units of value. The unit itself can be one stock, one bond, one unit of currency, or one unit of something else. The asset is described by defining transactions such as buy, sell, or a dividend. The transactions operate on the set of units in the asset using operators and the cumulated effect of all transactions describe the current financial state of the asset.
At the next level of the value document, assets are organized into Portfolios. The assets are grouped together according to the value type of the asset, i.e. whether the unit of value is a stock, a bond, or a unit of something else. The value type determines properties of the asset, such as the dynamics of the asset. Assets of the type stock are dynamic since the price of one stock may vary. Assets of the type bank account are static since the price of one unit of the local currency can not change (i.e. the value of 1 US Dollar is always 1 in the US).
At the top level the aspect of ownership is taken into account. A common denominator for all assets in an OmniValue document is that they have the same owner. The Owner organizes portfolios of assets of different value types into a single group, and provides an overview of the total investment in and return of all assets.
All three levels of a value document mentioned here, Asset - Portfolio - Owner, are fundamental entities in OmniValue, and they are further described in the rest of this chapter.
1.2 Asset
An Asset is defined as a set of identical units of value. The unit can be one stock, one bond, one unit of currency, or one unit of something else. An asset is described by defining the type of the unit of value, the name of the unit, the value of one unit, and the number of units in the asset.
An asset can be in one of three states:
By default, an asset is always included in the calculation of financial data at higher levels, i.e. in the portfolio containing the asset, and in the owner owning the portfolio. However, in some cases, it is of interest to exclude the asset from the uppward calculation, or aggregation of financial data. The asset can then be excluded.
If the asset contains transactions which does not make sense in the given context of the asset, the asset is in state inconsistent. An example of a transaction which is not consistent is a sale specifying 200 units, when the asset actually only contains 100 units. If the asset is inconsistent it will not be included in the calculation of financial data at higher levels.
If the asset is not excluded, and it does not contain any errors, it is in state included.
The state of an asset is indicated by its icon. The icon for an asset resembles an urn, indicating that it can hold units of value. If the asset is included, the amount of filling in the urn indicates the amount of investment in the asset, the return of the asset, and if there are any units in the asset. The following table shows all combinations for a stock asset (without a reference).
| icon | asset state | description |
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excluded | Asset is not included in aggregation (upward summation) of financial data |
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inconsistent | Asset contains errors (inconsistent transactions) |
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included | Only investment during the accounting period |
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included | Both investment and return during the accounting period |
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included | No investment during the accounting period |
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included | No units left at the end of the accounting period |
An asset can be connected to a reference. A reference to an asset provides information about the asset, such as the present value of one unit in the asset. A reference is provided by a reference source. A reference source may for example be a web server on the Internet which provides current prices of stocks.
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Icon for an asset with a reference: both investment and return during the accounting period |
The icon for an asset which is connected to a reference has two "antennas" on top, indicating that there is an active reference available in the program.
1.3 Portfolio
A Portfolio contains assets of the same type. In OmniValue, an asset must always be of a known type. The type specifies which transactions can be used, which tax rates are applicable, if the value of one unit can change, etc. The value type is always defined when creating the portfolio, and can not later be changed, neither in the portfolio nor in the created assets. OmniValue provides a number of predefined types:
These value types can be edited, and new value types can be defined. This is further described in the chapter for value types.
The icon of a portfolio is determined based on three fundamental properties of the value type of the portfolio:
A value type is dynamic if the value of one unit can change. A stock is a dynamic value type, since the value of one stock can change. A bank account is a static value type, since the value of one unit can not change (with respect to the local currency of the country in which the bank is operating).
A value type is productive if the mere possession of a unit of value will generate an income. Examples of productive incomes are interest (e.g. bank accounts), and dividend (e.g. stocks). Examples of value types which are not productive are cash and currency.
A value type has tax reduction if the balance of an asset of the value type reduces the tax burden for the owner. Investment in an asset with tax reduction will not be included in calculations of investment for the owner. The same applies for the total value of the asset. However, in all other aspects, a value type with tax reduction will work in the same way as a regular value type.
The combination of the dynamic, productive and tax reducing properties of a value type determines which icon that is used for the portfolio.
| icon* | portfolio type | dynamic | productive | tax reduction |
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e.g. stock | yes | yes | no |
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e.g. currency | yes | no | no |
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e.g. bank account | no | yes | no |
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e.g. cash | no | no | no |
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tax account | no | yes | yes |
* In a similar fashion to the asset, a portfolio can be explicitly excluded from the calculation of financial data at higher levels. In that case, the icon for the portfolio will be shaded (grayed).
1.4 Owner
At the highest level in the value model, all assets are grouped together into a single group, defined by a common legal ownership. All assets in an OmniValue document must have the same owner, and there is a 1:1 relationship between an owner and a document file.
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Icon for the owner. |
1.5 Transactions
In order to describe an asset, transactions are defined. Transactions can only be defined for assets. In general, a transaction describes:
The cumulative action of all transactions in an asset gives the current financial state of the asset.
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Icon for a Buy transaction. |
The transaction icons in OmniValue are defined to tell something about the transaction they represent. The diagonal in the icon represents the change in number of units in the asset. In the case with the Buy transaction, the diagonal has an up arrow, indicating that the transaction increases the number of units in the asset. In the upper left corner of the icon there is a purple dot. This indicates that the transaction increases the investment in the asset. In a similar fashion, a blue dot in the lower right corner of the transaction icon indicates that the transaction increases the return from the asset (which is not the case for the Buy transaction).
A list of all predefined transactions in OmniValue is given below. In addition to these transactions, new transactions can be defined using the interface for defining new transactions.
| Icon | Name | ID | Description |
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Initial Balance | 50 | Use this transaction to specify an initial balance without investment. |
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Buy | 110 | Use this transaction for a purchase where the price per unit is specified. A transaction fee can also be specified. |
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Buy Total | 120 | Use this transaction for a purchase where the total price for all units is specified (including any transaction fee). |
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New Issue | 210 | Use this transaction for a purchase where the price per unit is specified, and where the number of units offered depends on the number of units in possession. A transaction fee can also be specified. |
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New Issue Total | 220 | Use this transaction for a purchase where the total price for all units is specified (including any transaction fee), and where the number of units offered depends on the number of units in possession. |
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Investment Distribution | 250 | Use this transaction to add investment per unit without changing the current holding of units. Use a positive value to increase investment, a negative value to decrease investment. |
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Investment Distribution Total | 260 | Use this transaction to add a total investment without changing the current holding of units. Use a positive value to increase investment, a negative value to decrease investment. |
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Sell | 310 | Use this transaction for a sale where the price per unit is specified. A transaction fee can also be specified. |
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Sell Total | 320 | Use this transaction for a sale where the total price for all units is specified (including any transaction fee). |
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Clearance | 410 | Use this transaction for a sale of all units in possession where the price per unit is specified. A transaction fee can also be specified. |
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Clearance Total | 420 | Use this transaction for a sale of all units in possession where the total price for all units is specified (including any transaction fee). |
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Dividend | 510 | Use this transaction for a cash reward per unit in possession. A transaction fee can also be specified. |
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Dividend Total | 520 | Use this transaction for a total cash reward for all units in possession (including any transaction fee). |
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Unit Dividend | 610 | Use this transaction for a reward in the form of new units per unit in possession, and where the value per new unit is specified. A transaction fee can also be specified. |
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Unit Dividend Total | 620 | Use this transaction for a reward in the form of new units per unit in possession, and where the total value for all new units is specified (including any transaction fee). |
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Split | 710 | Use this transaction to increase the number of units with a nominal factor to the current holding of units without investment. |
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Reverse Split | 720 | Use this transaction to decrease the number of units with a nominal factor to the current holding of units without investment. |
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Bonus Issue | 810 | Use this transaction to increase the number of units without investment, and where the increase of units depends on the current holding of units. |
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Coupon | 530 | Use this transaction for a cash reward per unit in possession. A transaction fee can also be specified. |
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Coupon Total | 540 | Use this transaction for a total cash reward for all units in possession (including any transaction fee). |
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Deposit | 910 | Use this transaction to increase the number of units in possession. |
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Withdrawal | 920 | Use this transaction to decrease the number of units in possession. |
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Interest | 930 | Use this transaction for a reward in the form of new units in possession. |
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Interest Return | 940 | Use this transaction for a cash reward. |
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Account Balance | 60 | Use this transaction to specify an initial balance without investment. |
If a transaction does not make sense in the given context of the asset (i.e. the date at which the transaction is defined) the transaction is inconsistent which is signalled by the icon for error. In a similar fashion to an asset a transaction can be explicitly excluded from the calculations. This is signalled by the icon for excluded transaction.
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Icon for inconsistent transaction. |
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Icon for excluded transaction. |
1.6 Financial Metrics
The following financial metrics are used to describe a financial value in OmniValue. They are measures of the current and past profitability of a financial investment. All definitions are valid in the context of a given accounting period. All definitions refer to an asset but they are also valid for a portfolio or an owner.
| Metric | Definition |
| Market value | The most probable price of an asset in a competitive and open market not affected by undue stimulus. |
| Gain/Loss | The gain or loss in value of an asset. This is calculated as market value minus cost basis (cost basis is the total average paid for the current holding). This is measure of the profitability of the investments that are still hold. |
| Cash flow | The amount of cash an asset generates and uses. This is calculated as cash receipts minus cash payments. |
| Investment | Money paid for an asset. |
| Return | OmniValue defines return as the sales, or the revenue of an asset. |
| ROI | Return On Investment expressed as a percentage. This is calculated as the the return of the asset divided by the investment in the asset. This is measure of the profitability of the investments that have been sold. |
| Income | Revenue minus expenses (if any). For a sell transaction the income is the same as the profit. For a dividend transaction the income is the same as the revenue. |
| Tax | A percentage of the income that is paid to the state. |
| Risk | The variability of returns from an investment. In OmniValue risk is measured on a scale from 1 to 10, where 1 is the least risk. |
| Elements | The number of all "entities" contained in a value plus 1 (the value itself). For an asset the number of elements = the number of transactions + 1. |
| Errors | The number of inconsistent transactions in an asset. |
| Events | The number of transactions in an asset. |
| First transaction | The first transaction in time in an asset. |
| Last transaction | The last transaction in time in an asset. |
| Last change | The last time data for an asset was changed. The change can either be the last transaction or the last time the asset was edited or updated from a reference. |
1.7 About OmniValue
The name "OmniValue" is composed of the two words "omni", latin meaning "all", and the word "value". OmniValue can thus be interpreted as "all values" meaning that all kinds of assets can be managed within the same document.
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