I've faced with requirement that seems to be standard for IAS/GAAP but quite new for CIS countries:
Loans received are entered in the accounting statement in the amount of amortised cost with the application of the effective interest rate.
I need your help to find proper way to realise it for my client.
I expect that it should be done through TPM1 and i need to specify market data on effective % rate.
I'm entering loan received with product category "Interest rate instrument":
Amount 1000 USD
Interest rate 2%
Interest and repayment at the end.
Cash flow is quite simple:
01.05.2012 1105 Borrowing / Increase 1 000,00
01.05.2015 1120 Final repayment 1 000,00-
01.05.2015 1200 Nominal interest 60,83-
I've also specified standard Position Management Procedure = 1001 Sec./Loan: MtM (P/L)/Amort. SAC Net Separate Position Costs.
My questions now are:
1) How do i specify effective interest rate? In my example i want to discount future cash flows with market rate 5%
2) Am i right about choice of PMP (1001) and Tcode for that (TPM1)?
Thanks in advance and best regards.