Getting Started

2.1 Getting Started: Overview of Mclowd Architecture

The Mclowd architecture correctly presents a Superannuation Fund as a Trust that engages in business on behalf of its members. The Fund engages in business activities that result in income and expenses. The profits from these activities are shared proportionally among members, according to the percentage of ownership their contributions and earnings entitle them to claim.

The Fund also acts on behalf of individual members in certain transactions. It may purchase assets on behalf of an individual member (a segregated asset). That asset may generate income, to which only that member is entitled. In order to generate that income, expenses specific to that asset may be incurred.

In order to accurately calculate member balances and entitlements, Mclowd provides an Account Selection feature that enables you to specify, for every transaction entered, whether the transaction affects the Fund (i.e. relates to business activities by the fund for the benefit of ALL members) or whether the transaction affects only an individual member.

When entering contributions for and on behalf of members, for example, the contribution benefits only the Member, and should be credited to the Member account. But the contribution will flow to the Fund’s bank account to be held in Trust for the Member, so it should be credited to the Fund’s bank account.

Similarly, when entering income or expenses relating to segregated assets owned exclusively by a member, the member account should be credited with the income or debited with the expense, but the corresponding entry to the bank or debtor or creditor account should be attributed to the Fund, which will manage cash, debts and receivables on behalf of all members.

When setting up a Superannuation Fund in Mclowd, a FUND is first created. The Fund is the primary, or parent, entity. Everything owned by any child entity, or collectively by all child entities, is owned by the Fund. The Fund receives all income and allocates it to the various child entities, and pays all expenses and deducts them from the balances held by various child entities.

Beneath the Fund, a POOLED FUND, a child entity of the FUND, holds title to all jointly held assets, receives all joint income and pays all joint expenses.

Each Member is a child entity of the Fund and holds one or more Accounts (Pension, Accumulation or Transition to retirement) to which income from that Member’s segregated assets, contributions, roll-ins, plus a share of jointly earned Fund income is credited, and from which that Member’s expenses, pension payments, and commutations, plus a share of expenses incurred by the Pooled Fund are paid.
Mclowd Architecture Graph 1

In a more complex Fund, the Fund holds all jointly owned assets, receives income from jointly held assets, and pays expenses related to Fund activities.

Selecting to view transactions or assets for the ENTIRE FUND displays all transactions or assets, whether transactions relating to, or assets belonging to, the POOLED FUND, or to individual members.

Selecting to view transactions or assets for FUND displays only transactions relating to, or assets belonging to, the POOLED FUND, and excludes transactions relating to, or assets owned by, individual members.

Each member may have accounts in Accumulation mode, Pension mode, and/or Transition to Retirement mode.
Mclowd Architecture Graph 2

about the author:

Lorraine Cobcroft

With a background in accounting and financial management, followed by two decades writing software documentation, Lorraine joined the Mclowd team in mid-2016 and is enjoying working with a dynamic team to enhance an innovative product that has the potential to revolutionize the way Australians manage their retirement funding. Lorraine is also an accomplished business writer, ghost-writer, novelist and short-story writer and poet.

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