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FICA Item Interest calculation

Hello colleagues,

We have configured item interest calculation as follows and are not getting expected results.

Calculation Rule configuration:

  • Calculation method: 3 act/365
  • The Rate is set to 1% for Interest interval 1 (Month)
  • Month rule: No Interest Calculation on a monthly basis
  • Scale Type : No staggered Interest rates
  • Checkbox for "Interest per day" is turned on

Interest Key configuration:

  • Tolerance : 1 day
  • Interest frequency: 1 day

Open item amount 2.000 JOD, Due date Feb 3rd 2018

Interest calculation date (upon clearing: April 11th 2018)

Based on my understanding of the documentation, the interest should calculate as follows:

2.000 X 0.01 <no: of X <days> (67) /365 = 0.0037 (or close to 0.004)

However, the system calculates 0.067

Perhaps I'm misinterpreting how the calculation should work.

Any insights will be helpful.

Thanks and regards,

Ivor Martin

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3 Answers

  • Best Answer
    Apr 12 at 05:02 PM

    Hi Ivor,

    The Interest rate that you have configured is against a monthly interval.

    So ideally the interest rate for calculation would 0,01*12=0,1201 per annum (non-compounded equivalent)

    Hence the interest calculation would have been 2*0,1201*(67/365) = 0,044

    Can you check if the interest rate has any premium part or not which may be adding up to the interest rate for the calculation part;

    Thanks,

    Amlan

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  • Apr 13 at 02:10 PM

    Hi Amlan,

    Thanks a lot for the prompt response.

    When you say "ideally", do you mean based on my configuration, the calculation you have shown is how SAP should make the calculation?

    Please clarify.

    Also, I double-checked the Premium configuration - there is no premium configured.

    Please let me know if you have other suggestions.

    Thanks in advance.

    Regards,

    Ivor

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    • Hi Amlan,

      Thanks again for your additional feedback.

      The only other setting I can see is in Posting area 1084 (Additional Functions for Interest calculation).

      The setting for "Calculate Interest on Net amounts" = set to "X" (for Yes).

      Please let me know if this could be influencing the calculation.

      Thanks and regards,

      Ivor

  • Apr 16 at 01:06 PM

    Hi Amlan,

    I think the problem was solved by disabling the "Calculate Interest per day".

    Because of the small amounts (some of them down to 4th decimal places) some interest calculation per day was zero (we have 3 decimal places in this implementation).

    It looks like its calculating correctly now. I'll let you know if there's anything else to share.

    Thanks a lot for your help.

    Regards,

    Ivor

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