Conditions Detail: Interest Rate Adjustment

Use

This condition type is necessary if you specify a variable interest rate. The variable interest rate requires two types of entries.

  1. You specify the reference interest rate.
  2. When creating a financial transaction, the interest adjustment method PANF (= at start of period) is set as default. In order to define another interest adjustment method, branch to the Conditions Detail Screen: Interest Adjustment via Goto ® Interest rate adjustment ® Other Interest rate adjustment.

In the Condition Details Screen: Interest Rate Adjustment, you can specify how frequently the variable interest rate should be recalculated and on what day the reference interest rate should be set.

Prerequisites

It is recommended that you regularly maintain the reference interest rate table in order to have the current data available to fix the interest rate.

Procedure

In the Update rule area, you enter the frequency with which the variable interest rate will be recalculated and/or become effective. The following alternatives are available:

  1. Interest rate adjustment relative to start of period
    1. Interest rate fixing date relative to interest rate adjustment
    2. Interest rate fixing date relative to period end
  2. Frequent interest rate adjustment, interest rate fixing date relative to interest rate adjustment
  3. Single dates

Via Single dates, you specify the dates on which interest rate adjustments are to take place. The interest rate fixing date is relative to the interest rate adjustment date.

Choose Edit ® Single dates. Enter the required interest rate adjustment dates.

In the Additional information update area, specify in the frequent update rule, which monthly or daily update should be used.

In the Interest rate adjustment area, enter the first interest rate adjustment date.

In the Interest rate fixing area, specify the postponement rule for the interest rate fixing date and also the number of days by which the interest rate fixing date differs from the interest rate adjustment date and/or end of period.

In the Additional information working day area, you specify the calendar to be used for determining dates.

Notes for Processing