Set up Interest Rates

To define the interest rates, you must define:
  • The interest rate codes in the Interest Rate Codes (tfacr5103m000) session
  • The interest rates in the Interest Rates by Days Overdue (tfacr5104m000) or Interest Rates by Dates (tfacr5105m000) session

In the Interest Invoice Related Data (tfacr5101s000) session, you may optionally define a separate invoicing method for interest invoices to allow to link to interest notes a report different from a standard invoice.

You must link the interest rate codes to business partners in the Invoice-to Business Partners (tccom4112m000) session.

To set up interest rates:
  • Use the Interest Rates Codes (tfacr5103m000) session to define an interest rate code for every penalty interest table. Click on the record to access the Interest Rate Codes (tfacr5603m000) session which is the detail session. This session displays these sub sessions based on the value selected in the Calculation Method:
    • Interest Rates by Days Overdue (tfacr5104m000)
    • Interest Rates by Dates (tfacr5105m000)
  • Use the Interest Rates by Days Overdue (tfacr5104m000) session to maintain the interest percentage for each interest rate code where the Calculation Method is Days Overdue. The percentage is used to process interest invoices. The user must specify the minimum number of days after which interest is calculated on invoices.
  • Use the Interest Rates by Dates (tfacr5105m000) session to maintain the interest percentage for each interest rate code where the calculation Method is set to Periodical Interest. The percentage is used to process the interest invoices. You must specify the effective dates since when interest is calculated on the invoices.
  • Use the Accounts by Financial BP Group (tfacr0110m100) session to link the interest rate codes to the financial business partner groups. In order to open it, start the session Financial Business Partner Groups (tfacr0110m000) session and double-click the selected business partner group record.
  • Use the Invoice-to Business Partner (tccom4112s000) session to link an interest rate code to the selected invoice-to business partner. In order to open it, start the session Business Partners (tccom4500m000) session, double-click the selected business partner record, and click it’s Invoice-to role.
  • Use the Select Invoice-to BP Invoices/Receipts for Interest Invoices (tfacr5210m000) session to select the invoices based on which interest is calculated. Interest amount is calculated in accordance with the rates indicated in the interest assigned to the business partner or the financial business partner group.
  • Use the Reminder Letters (tfacr3508m000) session to determine if the interest rate codes linked to the business partners or the financial business partner groups must be used to calculate the interest for the reminders.
  • Use the Print Reminder Letter (tfacr3405m100) session to print the reminders and requests for payment concerning expired invoices. If the Use Interest Rate Code is selected in the Reminder Letters (tfacr3508m000) session, the interest amount is charged in accordance with the rates indicated in the interest table assigned to the business partner or the financial business partner group.