Interest accrual method calculation for loan interest

Hello,
Our company is using the Trsy module for intercompany loans with these settings on the deal:
- Interest calculation method of 7 360/360
- Linear Interest Calculation and the
- Pro Rata Temporis Calculation selected for both the first and last period.
Quite possibly with the last support pack update earlier this spring we are now getting the months of the year to calculate the interest expense/accrual differently for certain months when we expected an even accrual each month.
AD1005 is the update type used by TPM44.
Do you know of an additional setting needed to make each month accrue the same amount?
Thank you very much,
Ron Pruitt

Hi Ron
It could be that you are getting a different number of days than expected because of the default setting in TPM1 with including/excluding the beginning and end date. For instance, let me explain:
TPM1 takes the beginning of the calculation period as included and the end as excluded - this means that, for example,
           from    28.02.2011 inclusive
             to      31.03.2011 exclusive
is, in fact, 31 days with calculation method 360/360.
Your expectation would be that
          from    28.02.2011 exclusive
            to      31.03.2011 inclusive
which gives 30 days.
TPM1 calculates it in a different way, so this might be why the number of days might differ in this case.
If I have misunderstood your issue, please let me know.
Regards,
M Trein

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"Interest on Arrears calculation" vs "Item Interest Calculation"

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Could anyone explain me the difference between "Interest on Arrears calculation" and "Item Interest Calculation" and in what cases they are used.
Thanks,
DSK.

Item Interest Calculation
    In this activity you make the general settings for the individual
    interest indicators for the item interest calculation
     These include settings for selecting the items and for
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    postprocessing, output control, and for posting.
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     In this step you make general specifications for each interest indicator
     for the account balance interest calculation. These include
     determination of the period, the interest determination, the subsequent
     processing of interest, the output control for printing forms as well as
     the terms of payment
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Arun

IHC interest accrual calculation for subsidiares

When interest accrual calculation is done in IHC (F993), the transaction F9HI (FI transfer) posts these amounts in the FI of the company that holds IHC.
Our customer wants that the corresponding amount (with opposite sign) is transferred to the FI system of the subsidiary.
Did you have ever had any similar request?
(the situation is different from interest calculation (F996 or F991) in which a single item corresponding to the interest amount is posted on the IHC account and then is transferred to the subsidiary via the IHC bank statement)
Thanks!

Hi guys, this is the SAP answer to the incident we have opened.
"I have understood the issue that you are facing. I am afraid, there is
no standard solution in IHC to update the subsidiary with the interest
accrual items. From the IHC design point of view, the business process
does not state to replicate the postings of the IHC system into the
subsidiary. The idea is to make payments on behalf of the subsidiary
and in the process also allow the reconciliation to happen at
subsidiary by clearing the customer/vendor line and updating the
payable/receivable accounts of the subsidiary.
As you mention, you are transferring the interest postings resulting
from F996 to the subsidiary system, however, this is not a step
defined in the IHC business process.
As far as F993 interest accrual is concerned, you have rightly
mentioned, the GL transfer is performed only to the IHC/HQ GL
accounts. There is no provision of transferring the accrual items to
the subsidiary GL accounts.
This is as per the standard IHC design.
I am sorry, but i have no better news for you on this front."

Item Interest Calculation for partially cleared items

Hi
We need to do interest calculation on Customer Line Items. The T Code we are using is FINT. We have set an interest indicator for Item Interest Calculation, with Interest Calculation based on Items Cleared with Payments. The requirement is that Interest should be calculated on even partially cleared items. Suppose a customer invoice is generated on 1.1.2009 for INR 100000 and becomes due for payment on 30.1.2009. Now on 10.2.2009, a partial payment is recieved against this invoice for INR 30000. System should calculate interest on INR 30000 for 11 days. Now again on 20.2.2009, remaining payment of INR 70000 is recieved. In such a case, interest should be calculated on INR 70000 for 21 days @ 1.25% PM. In the current configuration, when we define that system should calculate interest on Open Items cleared with payments, system calculates interest on INR 100000 for 1.25% for 21 days. Pls suggest.
Regards
Sanil Bhandari

Hi u can check all below steps with specific fields i thought it is working perfectly check it.
1. Define Interest Calculation Types
here u can enter int rate type as a "S" Balance interest calculation
2. Prepare Account Balance Interest Calculation
here u can enter int calculation frequency means monthly or quarterly etc. calander type G, select balance plu int check box
3. Define Reference Interest Rates
Here u can enter date currency
4. Define Time-Dependent Terms
here u can enter currency effective from date sequential number term (Debit interest: balance interest calc. or Credit interest: balance interest calc.) referance int rate enter before step what u r defined that one u can enter here.
5. Enter Interest Values
here u can enter interest rate for that referance int type
6. Prepare G/L Account Balance Interest Calculation
Here u can enter ur g/l accounts
0001            Interest received (int received a/c)
0002            Interest paid      (int paid a/c)
0011            Pt vl.min.int.earned(int received a/c)
0012            Pst vl.min.int.paid(int paid a/c)
0013            Pst vl.dt.int.earned(int received a/c)
0014            Past val.dt.int.paid(int paid a/c)
0015            Calc.per.int.earned(int received a/c)
0016            Calc.period int.paid(int paid a/c)
1000            G/L account (earned)(Loan giving a/c)
2000            G/L account (paid) (Loan taking a/c)
after that u can post transaction execute ur transaction code i thought it is helpful for u
Regards,
Nauma.

Mark Interest Accrual for MM Instruments as Posted at go-live

Folks I have a simple situation wherein I want to mark legacy Interest Accruals as Posted, the way TBB1_LC works.
If I run TPM44 with no immediate posting, it does the trick but then sets the status as To Be Fixed, I tried using TPM18 to see if later on such flows could get fixed by mistake, and SAP did not fix any flows which is what I want.
Question is whether TPM44 with no immediate posting should work same as TBB1_LC for my scenario ?
Much Appreciated.
Rahul

Hello Renatas,
Simple Scenario is:
For an "Intercompany Loan" Instrument with 4 months freq. Chronology given below:
Last Payment/ Capitalization Date = 5/31/2014 (Position/Principle Balance = 1mm)
Legacy/Excel based Interest Accrual on 6/30/2014 = 1k
Legacy/Excel based Interest Accrual on 7/31/2014 = 1k
SAP Go-live Date = 7/31/2014
On 7/31, Performed TBB1_LC with Position Principle as of 5/31/2014 (1mm) with Position Posting Date = 5/31/2014 (no posting in SAP)
On 7/31, Above 2 Accruals posted to new SAP GL Account on 7/31 (general journal, not via TR)
But to proceed further, how to statistically post Legacy/Excel based Interest Accrual on 6/30 & 7/31 like we did in TBB1_LC.
Please note postings to previous periods are not possible as they have been closed and have been posted manually accounting wise from excel.
SAP based Interest Accrual on 8/31/2014 = 1k (posted in SAP)
SAP based Interest Accrual on 9/30/2014 = 1k (posted in SAP)
On 9/31 Interest Capitalization Date = New Principle = 1mm + all total interest accruals which will be the correct cash flow indicated by SAP.
Please note that the loan instruments are denominated in different currencies than CoCd currencies hence there are forex gain/loss issues too.
Regards,
Rahul

Interest calculation for vendors

Hello gurus,
                 In interest calculation for vendors, In interest on arrears calculation(vendors) t-code (obv9) Here wht we have to configure the steps, like Infirst step i had given,,
Account symbol             Currency                 G/l Account
0002                                  inr                       40009(interest)
Then second step wht i have to give for vendors,, if it is general ledger we will give 2000(g/l a/c paid).
My question is wht we have to give in second step......For Vendors...
Regards,
Assign Points.

Hi,
vendors and customers interest is p type.and it is item interest calculation. The t.code f.2a, f.2b. Try with this.
If helpful assign points,
Rams

What are the custimization steps to run interest calculations for customers

Hi,
I need a full custimization steps to configure the interest calculations for customers. i created interest indicators, g/l accounts and account determinations also. but no interest is calculating for customers and customers are having no of days to calculate the interest. So please guide me on this regard.

Hi,
Configuring the Interest Calculations Procedure
This configuration allows you to charge interest on overdue customer accounts. Interest can be calculated by using the line items or overall account balances. SAP keep tracks of the date of the last interest run and stores it in the customer master record.
First create an Interest Indicator.
OB46 - Interest Settlement Calculation Type
Int Calc. Type
P - calculate interest based on line items.
S - calculate interest based on account balances.
Secornd, make it avaliable to the interest run program.
OB82 - Interest Terms
Third, determine the interest rate that will be used by the calculation.
OBAC - Define Reference Interest Rates
OB83 - Enter the Reference Interest Rates Value
Fourth, assign the interest indicator to the reference interest rate.
OB81 - Define Time Dependent Terms
Finally, determine the how and to which accounts the interest program will post.
OBV1 - Prepare Interest on Arrears Calculation
Please check out the following link also:
http://help.sap.com/saphelp_erp2004/helpdata/en/41/37b8e7455b11d182b40000e829fbfe/frameset.htm
Hope this helps.
Please assign points as a way to say thanks.
Regards,

Floater accrual interest and tax calculation

I have one secutity ID 353022, in security position cash flow as attached, I want to know how accrued interest to pay 36422.22 is calculated, which interest rate it is applied? also how interest deduction inc. reclaim tax 88254.83 is derived?

Hi,
to answer your first question, accrued interest interest to pay (or the Update type 'SE8702') is calculated based on the amount, the coupon rate applicable (in your case 2.1160 if I read it correctly), the period between the last coupon payment date (in your case 15.09.2014) and the current bond purchase date (in your case 16.11.2014) and finally the number of days in a year (depending on the interest rate method applicable).
regarding the second question - I would guess interest deduction inc. reclaim tax or the Update type 'SE3006' is generated as a result of the Flow type '0306' and as the Flow category is 'Other Flow/ Condition', it is just entered manually.
hope this will help you.
Kind regards,
Renatas

Interest calulation method for asset accounting

Hi,
I have a problem with the calculation of depreciation and interest for a particular asset class. The assets are financial leases. The depreciation key defined is LEAS. The following are the attributes of this key:
Dep/int--phase-base met--dec-bal--prd cont-mult lvl--chn ov
Ord.depreciation--- 10011 001 006 001--
5
Ord.depreciation--- 2 0002 001 003--
003
Interest -
1-- 0028 001 003--
010
An example of an asset is:
Aquisition value: 1041552.71 (as migrated on 01.04.2007)
Ordinary dep already posted: 56243.88
Net book value: 985308.83
Scrap Value:729086.90
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Expired useful life: 9 years 1 month
Remaining useful life: 40 years 11 months.
Depreciation start date: 28.03.1998
Interest calculation start date:30.03.1997
Depreciation calculated by the system:6261.83
Interest calculated in the year:15682.68
I'm not able to undersatnd on what basis the system calculated the interest. I will be thankful if anyone can help me resolve this. An early reply will be greatly appreciated as I'm facing major problems due to this issue.
Thank you in advance for the help,
Lakshmi

Hi,
In the depreciation key interest is configured hence the system is calculating the interest. Is it a asset migrated from Legacy system.
As per your Business process how the interest is getting calculated? Can you elaborate on this?
Thanks
Murali.

FSCM-CR: Automatical Interest Calculation for Late Payments

Hi all,
Do you guys know if there is a standard functionality ( on SAP Collections Management or in SAP Credit Management) for automatical interest calculation for the customers late payments ?
Our client is on FINBASIS 6.00
Thanks in advance.
Best Regards.

Hi,
It will not be possible to post from Collections management as it would in general not be done by receivables team.
However, interest on arrears is a standard function available in Financial Accounting itself. Maybe you can use them for your requirement.
Regards,
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Interest calculating for 364 days in year

hi
i am calculating interest for 1 april to 31 march for the previous year but instead of taking 365 days it is calculating for 364 days. can you tell that what i have to do to correct it.
Thanks

Hi You can see in the payment terms you mentioned as one day due to this it will calculate the interest only 364 days.
If the payment terms are correct then while running the interest( f.4b or f.2b etc.) there select the layout as open items include postings and select calculate the ineterest on net due dates then it will work properly
If you have still doubt let me know

Unable to reverse interest accrual in tbb5 - message flows does not exist

Hi All,
for few particular company codes, i am unable to see any flows which were posted earlier using tbb4 while executing tbb5. hence i am unable to reverse those flows. Is there any place wherein we activate update type for reversal company code wise.

Hi,
first of all I would propose to check with the help of TPM20, using as selection criteria 'Reversed Business Transactions' to see whether there were some reversals, relevant to your accounting entries observed.
regarding your mentioned transactions:
TBB4 is used for accrual (which could be imediately reset next business day - depends on accrual procedure, specified in Customizing -> SPRO -> ... -> TRM -> Transaction manager -> General settings -> Accounting -> Accrual/Deferral -> Money Market: Define Accrual/Deferral -> choose required Flow type, for which accrual is calculated and posted), so depending on the definition you will result in 1 (accrual) or 2 (accrual and reset of accrual) postings;
TBB5 would reverse the accrual postings, generated by TBB4 - the same as above, 1 or 2 postings, just opposite to previous ones.
I'm not pretty sure about your scenario, however if we talk about accrual TBB4 and possible reverse TBB5 due to some errors (e.g. nominal interest was wrong), then from process point of view once you executed reverse it is not possible to reverse TBB5. What you can do is just run accrual again, after inputs (nominal amount, interest rate, date of running accrual, etc.) for accrual are corrected.
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Rgds,
Renatas

Customer exit or BAPI for Loan Calculation repay

hi All,
I need to calculate the company loan repayments in a different way (which is out of the standard), Please let me know which customer exit or BAPI can make this possible.
Scenario:
Principal Amt = Rs. 10,000
Interest rate = 8%
Yearly Interest = 10,000 * 8% = 800
Monthly Interest = (10,000 * 8%)/ 12 (months) = Rs. 66.67
Now, if an Employee is asking for a 6 month period to pay-off the loan then the calculation will be :-
Principal Instalment = Rs. 10,000 / 6 (months) = Rs. 1667
Interest Instalment = Rs. 66.67 * 6 = Rs. 400
Total Instalment to be paid each month = Rs. 1667 + Rs. 400 = Rs. 2067.
Thanks in Advance
Amol
Edited by: Amolkumar Patil on Sep 17, 2010 11:38 AM

Check the table V_506P_B with Interval option.
If you are using payment type Loan Pament( Payroll)...check the table V_506P_B ..if you select Interval...... If you set this indicator for a payment type, the system also shows the column End Date in the Loans infotype (0045) on the Payments tab page. For the payment that you have specified with this payment type, this field End Date is ready for input. This means you can specify a start and end date for these payments. Within this interval system processes such a payment in each payroll period in the standard system.
Mohan

Loans interest Accrued monthly with no reversal

Hi experts,
We are gonna use SAP Banking for loan management. We have several type of loans but the important thing is that our user has asked us to have the accruals for the loan interests at the end of each month, but without being reversed at the begining of the next month.
Let say we have a 100$ loan, the first mont the interest accrued will be 5 and 8 for the second month.
SAP standard way of accounting this is:
at the end of first month: 5 accrued
at the begining of second month: 5 reversed
at the end of second month: 13 accrued (5+8)
at the beggining ot third month: 13 reversed
Specific way that we need:
at the end of first month: 5 accrued
at the end of second month: 8 accrued
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Thanks in advance

Hi,
As per standard SAP, this kind of accrual known as difference procedure is only possible for discounts and premium. For interest only reset accrual option is available.
Moreover if you use this kind of accrual using difference procedure for interest, then before posting the actual interest, you would have to reverse the total accrual right? Isn't that a round about way?
Anyway you can check the note 846723 for accruing interest using difference procedure in SAP Loans Management.
Also please check the below thread for similar issue:
Re: Loan: Acrrual/Deferral for difference procedure
Regards,
Ravi
Edited by: Ravishankar Ramamurthy on Jan 14, 2011 11:40 PM

Interest on arrears calculation

Hi all,
I would like to set the interest calculation for customer in the following way, can this be done? please advice.
If the customer line item is due during the month and the payment is received after the due date, when i run the interest calculation at end of the month, I do not want this item to attract interest although it is already due when the customer paid. How can this be done?
I have selected Open item and No cleared items in the item selection in Prepare item interest calculation SAPLFI_INTVW. However, when i run F.2B, the system still calculates the interest for this particular cleared item.
Please advice.
Thanks.

Thanks for the info but I am using F.2B and not FINT. Thus not able to view through FINTSHOW.
Is there anywhere I can view previous interest run if i use F.2B to run the interest calculation?
Thanks.

Interest accrual method calculation for loan interest

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