Setting Up and Processing Interest Calculations

Page Name

Definition Name

Usage

Interest Calculation Page

PROJ_BU_INTEREST

Define interest calculations for the business unit.

Project Costing Definition Page

PROJECT_GEN_01

Select the option to include project costs in interest calculations, which is used as the default for all new activities that are created for this project.

Project Definitions - Status Page

PROJECT_STATUS

Specify interest calculation factors based on a project's status.

Activity Definitions - Definition Page

PROJECT_ACTIVITY

Select Allow Interest Calculation to include activity costs in interest calculations.

Calculate Interest Page

PC_INTEREST

Calculate interest and insert new rows into the Project Transaction table based on selected criteria.

Use the Interest Calculation page (PROJ_BU_INTEREST) to define interest calculations for the business unit.

Navigation:

Setup Financials/Supply Chain > Business Unit Related > Project Costing > Project Costing Options > Interest Calculation

This example illustrates the fields and controls on the Interest Calculation page. You can find definitions for the fields and controls later on this page.

 Interest Calculation page

Field or Control

Description

Interest Type

Defines the type of interest calculated for a project in the business unit. You can enter more than one kind of interest to be calculated, such as debt and equity interest.

Calendar

Select the period calculation factors that are set up for the general ledger.

Interest Rate

Enter the yearly interest rate. The system calculates the periodic interest rate based on the yearly interest rate รท number of calendar periods.

Analysis Group

Enter the analysis group that contains the analysis types that are used as the basis for interest calculation. The analysis group typically includes all costs.

Target Interest Row Attributes

Enter the analysis type, source type, category, and subcategory as the attributes to identify new rows that are generated by interest calculations.

Important! The system performs compound interest calculations on all source types, except the ones that you enter in the Transaction Exclusions group box. You can exclude any source types from the cost accumulation. For example, if you are not allowed to include previous interest in calculating future interest, you can exclude previous interest from the cost accumulation

Transaction Exclusions

Field or Control

Description

Source Type

Select the source types to exclude from cost accumulation. Enter multiple source types as required.

Exclusion From Date  and Exclusion Through Date

Enter a date range for each excluded source type. This date range identifies the period of time for which a source type is excluded.

To include project costs in interest calculations, select Allow Interest Calculation on theProject Definitions - Project Costing Definition Page

If you include costs at the project level:

  • The system automatically includes costs that are incurred by all activities belonging to that project for interest calculations.

    Only those projects with a processing status of Active are eligible for interest calculation. After the PC Interest Application Engine process (PC_INTEREST) selects those projects with an active processing status, only those activities with a processing status of Active are eligible for interest calculation.

  • The Allow Interest Calculation option is selected by default on all subsequent activities created for this project

Use the Project Definitions - Status page (PROJECT_STATUS) to specify interest calculation factors based on a project's status.

Navigation:

Project Costing > Project Definitions > Status > Status

Use this page to define interest calculation factors for a specific project based on the project's status. For example, you can configure the system to recognize 100 percent of the calculated interest for a project in Open status, and 50 percent of the calculated interest for the project in an In Service status.

To define interest calculation factors that are based on status, enter an interest calculation factor for a status on the Project Definitions - Status page. Enter the value in decimal form, such as 1.0 for 100 percent, with a maximum of one digit on either side of the decimal point.

Use the Calculate Interest page (PC_INTEREST) to calculate interest and insert new rows into the Project Transaction table based on selected criteria.

Navigation:

Project Costing > Utilities > Calculate Interest > Calculate Interest

This example illustrates the fields and controls on the Calculate Interest page. You can find definitions for the fields and controls later on this page.

 Calculate Interest page

The data in this run control page shows the final step to calculate interest for the examples in the Defining Period Calculation Factors section in this topic.

Field or Control

Description

Option

Select to calculate interest for all projects and activities, or for specific ones. Options are:

  • All: Interest is calculated for all projects and activities.

  • Business Unit: Interest is calculated for the selected business unit.

  • Business Unit/Project: Interest is calculated for the selected business unit and project.

  • Business Unit/Project/Activity: Interest is calculated for the selected business unit, project, and activity.

Application Options

Enter the beginning and ending fiscal year dates, and the beginning and ending period, for which you want to calculate interest.

Click Run to initiate the PC Interest Application Engine process. The system adds a row for the calculated interest to the Project Transaction table with a General Ledger Posting Status flag (GL_DISTRIB_STATUS) value of N (not yet posted).

See the product documentation for PeopleTools: Process Scheduler