Interest calculation on overdue invoicesYou can generate interest invoices for overdue invoices. In addition, after generating and sending an interest invoice, you can generate a subsequent interest invoice for the next period. In the Interest Percentages (tfacr5102m000) session you can define the interest percentages for each financial business-partner group, and for different periods of days. The interest period For an interest invoice, LN calculates the interest amount over a specific period. LN determines the number of days of this period as follows:
Interest calculation The interest amount is calculated in the invoice currency. The general formula to calculate interest amounts is: Interest amount = invoice amount * (payment date - due date) / 365 * (interest %) / 100 For receipts and for the paid part of partly paid invoices, this results in the following calculation: Interest amount = Paid invoice amount * actual interest rate on the payment date / number of days in year * (receipt date - due date or previous interest calculation date) For unpaid invoices, this results in the following calculation: Interest amount = Open invoice amount * actual interest rate on the interest invoice date / number of days in year * (interest invoice date - due date or previous interest calculation date) Depending on the value of the Interest Invoice Selected Based On field inthe Interest Invoice Related Data (tfacr5101s000) session, LN calculates the interest on the receipt amounts, on the remaining open invoice amount, or both, as follows:
All received payments and credit notes are considered to determine the remaining open amount of the sales invoice. Once the remaining open amount is equal to zero no further interest is calculated.
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