The calculation of market value provides a powerful and extensible framework for evaluating your open and inventory position via mark-to-market. Each purchase and sale contract item has its own automatically calculated valuation based on the current market level and the valuation applied to the grade code. Users can also customize the valuation on a per-item basis.

Contract items each have an independent valuation that provides a mark-to-market calculation.

• Automatic - Use the Arrival Month to Futures Table to get an exchange position month and year for this contract item. Pull the differential from the Grade code table if applicable.
• Position - Enter the exchange position month and year to use for valuation on this contract item. No differential.
• Currency +diff+ position - Enter the currency, differential amount, and exchange position month and year.
• Allocated differentials - For a sale, use the differential from the allocated purchase. Should be used in conjuction with the Deferred P&L feature.
• Fixed valuation - Enter the specific price you want CATS to use for the valuation of this item.

From the contract item screen, use Val > Print Report to recalculate the current item's valuation and see a report of how the valuation was calculated.

Use Inventory Valuation Aging to apply a specific valuation based on the inventory age of the material. The inventory age is calculated based on the date of the first purchase activity for that contract.

Valuation aging can give you a more accurate understanding of how the age of your inventory is affecting your profitability.

From the menu on the Description codes/values scan, go to Tools > Valuation Aging.

This will bring up the scan for the Inventory valuation aging records.

Click on “Add” in the menu to create a new inventory valuation aging record.

Screenshot of the Add Inventory Valuation Aging dialog.

Specify the Aging Group for the new record. This can be any non-blank value, but should be descriptive of how the Aging record will be used.

Editing the Aging Record showing a 365-days aging record for the group “COMM”

Aging records have a group and a number of days. The aging valuation will be applied to any inventory records based on their first purchase invoice activity.

The valuation can either be a fixed/stated level, as a single differential, or as a “step-down” differential from the grade's standard valuation differential.

To enter the valuation aging as a fixed level:
Check the box that says “Use fixed valuation instead of differential.” and enter the market level and basis. The fixed price can not be zero.

To enter the valuation aging as a “step-down” differential:
Enter the differential value and basis and leave the Exchange field blank. Currency and Ratio have no effect in this mode.

To enter the valuation aging as a single differential value:
Enter the differential value along with the Exchange. If left blank Currency and Ratio will use the default for the grade code.

Set the “Aging” field on the Description Codes/Values page (or in the scan).

If the Grade/Description Code is set to use an active valuation aging record then CATS will perform an aging calculation when it re-values the contract.

Valuation report showing that aging is being applied.

For aged contracts the valuation report will list the contract's inventory age and the applied aging group.

If aging is applied, CATS will automatically disable the deferred profit option on the contract.

If aging is applied and there are allocated contracts using the “Allocated Differential” method, then the allocated contracts will all adopt the aging valuation.

Valuation aging as displayed on the contract item.

On the contract itself, CATS will display that the Inventory aging valuation is being used.

You can override the aging on an individual contract by setting the valuation mode to one of the manual options. If the defer profit setting was enabled before the aging was applied, it will be re-activated when you change to a manual valuation.