Interest calculation type

[Former Member]

hi,

in sap help interest calculation is divided into the following types:(http://help.sap.com/saphelp_banking80/helpdata/en/ec/a33d40c6d98437e10000000a155106/content.htm)

●      Linear Interest Calculation

●      Exponential Interest Calculation

●      Combined Interest Calculation

●      Intraday Interest Calculation

but in system i found

• item interest calculation
• balance interest calculation
• penality interest calculation

So,How these two group are related to each other and if they are not related then what is the difference among item interest calculation ,balance interest calculation , penality interest calculation and what are the business scenario in which these are used and what accounting effect these methods have

Regards

Khagesh

[former_member214973]

Hi Khagesh

Item Interest Calculation (P): Useful for customer/vendors account.

Balance Interest Calculation (S): Useful for GL Accounts.

For Examples

let secured loan taken from a bank

(1001)Bank A/c Dr

(2001)Loan Account Cr

Here interest will be calculated for loan account(2001) in this case balance interest calculation will be used.

Regards

Nakul

[Former Member]

Hi Nakul,

Still my core query is answered about penalty ,expnential etc

Regards

Khagesh

[former_member182339]

Hi Khagesh,

Go through this link it has your answer with examples

http://www.sdn.sap.com/irj/scn/go/portal/prtroot/docs/library/uuid/b01a43cf-2164-2e10-96a5-effc63968...

http://wiki.sdn.sap.com/wiki/display/ERPFI/Interest+Calculation

i hope it helps there is a lot of other information available, please read through the SCN forum you will get several threads for this.

Best regards

Hrusikesh

[Former Member]

Hi Hrusikesh,

I already gone through these document but these document does not contain any information about

• Penality interest calculation
• Exponential Interest Calculation   
• Combined Interest Calculation
• Intraday Interest Calculation

Not answered.