1. Cash Flow Engine Reference Guide
  2. Cash Flow Calculations
  3. Cash Flow Calculation Process
  4. Initialize Interface Data
  5. Interest Credited

7.8.3.2 Interest Credited

The interest credited option resides in the ALM > Product Characteristics Rule. The switch can be enabled for any leaf dimension. However, it affects only the cash flows of Simple/Non-Amortizing Instruments.

When the switch is enabled for a Non-Amortizing Instrument, interest cash flows are added to the Principal Balance at each payment before maturity. On the Maturity Date, the initial Principal Balance plus the accumulated interest Cash Flows are reflected as Principal Runoff at maturity. When the switch is enabled for Amortizing Instruments, it is ignored by the Cash Flow Engine.