Skip to Content
0
Mar 01, 2011 at 03:06 AM

Amortization of Premium/Discount for Bonds

434 Views

Hi,

I think the results of SAP's amortization are okay since at the end of the term the amortization amount is zeroed out. But my problem is, I cannot show the client as to how the amortization value per key date is calculated by SAP. Has anyone of you tried manually computing the value and were you able to get the exact computation? How's the EIR used in the amortization computed? As we know, if you're using an Excel you simply have to create the cashflow and use the goal seek function to get the EIR.

Amortization 3000-SAC Net I'm using in ECC6 version has the following settings;

Calculation category - SAC

Gross/Net - Net

Amortization To - Amortization to End of Term (SE/LO SAC)/Int.Calc.(LO LAC)

Include Interest - Include Interest, Accrued Interest Adjustment (Sec.Only)

Treat.EffInRate - Adjust Effective Interest Rate Immediately (Standard)

Thanks,

Chaikaru