Financial Mathematics in Leasing

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PUBLIC © 2014 SAP SE or an SAP affiliate company. All rights reserved.

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Table of content 1 Financial Mathematics in Leasing 1.1 Payment Structure and Payment Structure Variants 1.1.1 Adjustment of the Payment Structure During Change Processes 1.1.2 Flow Categories 1.2 Cash Flow 1.3 Financing Views 1.3.1 Subsidy and Participation 1.4 Calculation Procedure 1.4.1 Effective Interest Rate Calculation 1.5 Calculation of Rate per Thousand 1.6 Interim Periods 1.7 Interest Calculation Methods and Types 1.8 Floating Rate Adjustment 1.8.1 Interest Rate Adjustment for Leasing Documents 1.8.2 Evaluation of Successful Interest Rate Adjustment 1.8.3 Evaluation of Interest Rate Adjustment in Documents Containing E 1.8.4 Floating Rate Adjustment: Example


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1 Financial Mathematics in Leasing In leasing, you use financial mathematics (FIMA) to transfer a one-time amount financed to a cash flow. You then receive a payment schedule in which the outgoing payments precede the incoming payments. In the case of amounts that are not a financing (such as fees), you use financial mathematics to create fee payment schedules. You use the following functions in the lease to map financings to customer financing items of the category BUS2000301: Date management: Contains the relevant general data for a financing, s uch as t he start and end date of the financing, and the term Payment st ructure and payment structure variant: Contains t he financing template with the relevant entries Calculation procedure Financing view repository Pricing document: Contains all t he financing-relevant conditions You generate a payment schedule in the following sequence: 1. In the product master data, you define at least one financing product that is us ed as the financing template. In doing so, you differentiate between onetime and periodic flows. 2. In the lease quotation or lease (SAP CRM), you configure the individual financing template and generate a payment structure. To do this, the sys tem first imports data from the financing product (payment structure template) and adds to this the data from FIMA Customizing and the appointment data repository as well as the condition values (IPC conditions). You then make any further changes manually. 3. The system uses the calculation algorithm to create the cash flow and the payment schedule aggregated from it. This is c ontrolled flexibly by the settings for the financing product and in FIMA Customizing. 4. The system generates billing request items from the cash flow. The following functions are available for financial mathematics calculations in leasing: Payment Structure and Payment Structure Variants Payment Structure in Change Processes Flow Categories Cash Flow Financing Views Example: Subsidy and Participation Calculation Procedure Effective Interest Rate Calculation Calculation of Rate per Thousand Interim Periods Interest Calculation Methods More Information Date Management (CRM-BF-DAT) Financial Mathematics (CA-FIM)

1.1 Payment Structure and Payment Structure Variants You use the payment structure to define the financial mathematics conditions (such as type and number of periods, frequency, when due in period, installments to be paid, interest to be paid, as well as validity period) according to which payments are made in a leasing deal. You can configure the payment structure to meet the specific requirements of the lessee. SAP Leasing provides a generic concept for the payment structure: You can define as many payment structure variants as you want in Customizing and then assign these in the master data of the financing product. To enable you to preconfigure different variants for a specific process (new business, extension, termination), you can assign different variants to a pricing process in the product; this means you can make different variants available for specific processes. When you create a financing or service product in the master data, you enter the specific details for the variant in the payment structure. You can use the following functions within the payment structure: Payment structures with annuities Installment repayment structures Interest rate trends Deferral of repayments and interest in the payment s tructure Broken periods with settings for pro-rated calculations Different payment frequencies and due dates for interest payments and repayments Up to three concurrent fees in the payment structure Special functions, such as working day shift

Prerequisites You have made settings in the following Customizing activity: Customer Relationship Management under Payment Structure Variants

Financial Services

Leasing

Financial Mathematics Settings

Variants and Additional Flows

Define

.

Activities In the master data of the financing product, select the required pricing processes and assign to these the payment structure variants that you want to use for the product. You must use the Default indicator to specify which payment structure variants are used by default.


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1.1.1 Adjustment of the Payment Structure During Change Processes You use this function to adjust a payment structure when you execute a change process. You can execute change processes with and without payment structure variants.

Prerequisites 1. You have defined payment structure variants in Customizing for SAP Customer Relationship Management (SAP CRM) under Customer Relationship Management Payment Structure Variants

Financial Services

Leasing



Define

.

2. You have assigned a payment structure variant to the required pricing process in the master data of the financing product (in the "Distribution Chains" assignment block) and entered the specific details for the variant in the payment structure. You have to make the following settings in Customizing for SAP CRM in the case of change processes without payment structure variants: Additional one-time flows for change processes: Customer Relationship Management

Financial Services

Leasing



Leasing


Settings for FIMA Conditions

Additional One-Time Flows for Change Processes Date rules to restrict the duration of the payment structure: Customer Relationship Management

Financial Services

Date

Rules for Change Date and End-of-Lease

Features You can: Execute a change process with a payment structure variant When you execute a change process, you enter a payment structure variant. The system discards the current payment structure and searches the product master data of the financing product for a new payment structure that belongs to the selected variant. Consequently, the date on which you executed the change becomes the end date of the validity period of the present payment structure. You can use this method for a renewal, for example. The system behaves in the same way when you change a product. Execute a change process without a payment structure variant for: Financing processes You use two date rules to limit the duration of the payment structure. The system deletes all entries in the payment structure before the adjustment date and after the contract end date. The date rules define the new valid from and valid t o dates of t he new payment structure. Terminating processes The system discards the entire payment structure. You can enter one-time flows in Customizing for all processes (such as amount financed, fee). The system then automatically adds these to the payment structure. For change processes, y ou need to calculate a remaining balance or the amount to be c leared (for fees) that must be transf erred to the subsequent process. Financial mathematics provides a function for this. This function calculates the remaining balance that is due for the current cash flow . This provides the basis for determining the renewal conditions in the Internet Pricing and Configurator (IPC) tool for the subsequent process. Alt ernatively, you can implement your own method for calculating the remaining balance, for example, by discounting outstanding payments. The calculation for the new business process is completely decoupled. The newly calculated cash flow relates to the payment structure of the new item only and is calculated after you execute a change process as in new business.

Note When you execute a business process, the new process manages the data in the validity period of this process. You can get an overview of the payment schedule's history by navigating to those contract items that manage the previous business processes.

1.1.2 Flow Categories Use Within a financing, a differentiation is made between recurring and one-time flows (payment structure). The c ombination of one-time and recurring flows defines the payment structure of a financing. You define this payment structure in the financing template of the financing product. A flow is c haracterized by a flow category. Flow categories control the process flows within the financial mathematics algorithms. The SAP system distinguishes between internal and user-defined flow categories: Internal flow categories classify a value series for financial mathematics purposes. The internal financial mathematics f low categories provided by SAP define the calculation rules for generating the payment sc hedule. These rules determine how financial mathematics conditions and flows are process ed. The internal flow categories include Amount Financed , Annuity , Interest, and Residual Value . A user-defined flow category defines the values for an internal flow category. You assign the user-defined flow category to an internal flow category to define the financial mathematics significance of the flow category. When you define the flow category, you establish the link between the payment structure and the CRM condition technique, as you can assign condition functions to flow categories for specific financing views. You can import a currency amount and a percentage for a flow category from the pricing document for the contract item to the payment structure.


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1.2 Cash Flow The cash flow is calculated using financial mathematics and contains all the flows that are relevant for paying the end customer. Furthermore, the cash flow contains all the calculation bases, such as interest calculation capital and days, needed to understand the results from a mathematical point of view. Financial mathematic aspects, such as payment installment, interest, repayment, and fees, are processed in separate rows in the cash flow. Information from the payment structure variant, the customer financing view, and the calculation procedure is used to calculate the cash flow. The cash flow forms the basis for creating the customer payment schedule. The customer payment schedule is an aggregated view of the cash flow. Moreover, it is the basis for calculating additional payment schedules that you want to manage for other financing views. The cash flow is saved in the database and can be consulted for new calculations, such as an interest rate adjustment, or when a balance is calculated. In a lease, the cash flow is displayed at item level. The payment structure variant prescribes the duration of the cash flow.

Prerequisites You have made setting in the following Customizing activities: Customer Relationship Management

Financial Services

Leasing


Variants and Additional Flows Financing Views Configure FIMA Calculation Procedure

1.3 Financing Views You use this function to define the different views of a leasing transaction. Financing views can manage the payment schedules that you want to settle for a business partner (such as a leasing customer, dealer, or third party). You can also use financing views to manage analytical information, such as the comparison account in the effective interest rate calculation. A financing view is a s pecial view of an underlying cash flow. In the leasing sc enario, you generally use valuation bases t hat are not known to the lessee. For example, this can be a hidden discount that a leasing company receives from the manufacturer, which means the actual financing requirement is lower than the customer assumes. If third parties are involved, you can define views for subsidies and participations. You can use these views to manage different subsidies and participations, or a combination of subsidies and participations, for each lease. If you want to use more than one subsidy or participation, you must define a financing view for each subsidy and participation. You define the required financing views in Customizing. For example: Financing View for Customer Subsidy 1 Subsidy 2 Participation 1 Participation 2 Effective Interest The parameters defined in a financing view are included in the financial mathematics calculation of the payment schedule. The system calculates the relevant payment schedules in the contract based on the financing views you have assigned in the master data of the financing product. To this end, you need to configure the calculation procedure accordingly.

Prerequisites To be able to use different financing views, you must have defined these in Customizing for Customer Relationship Management under Services

Leasing


Financing Views

Financial

.

Note You must define at least the customer financing view so that the system can calculate the customer cash flow or payment schedule in a contract. If you want to use subsidies and participations, you must also configure the calculation procedure and make the settings for processing third-party business relationships.

Activities In the master data of the financing product, you assign the financing views that you require for a product. Here you also assign the interest calculation methods and corresponding parameters to the views. You can activate the financing views manually or using the Application Programming Interface (API).

Note You must assign and activate at least the customer financing view so that the system can calculate a payment schedule in a contract.

More Information Example: Subsidy and Participation

1.3.1 Subsidy and Participation PUBLIC © 2014 SAP SE or an SAP affiliate company. All rights reserved.

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The lessor provides financing at a base rate of 10 % p.a. The manufacturer grants an interest subsidy of 2 % p.a. for the entire period (subsidy view). The dealer receives an interest participation of 1% p.a. for brokering the contract (participation v iew). The installment to be paid by the lessee is based on an interest rate of 9 % p.a. (customer view).

Prerequisites To depict this calculation, you must make the following settings in Customizing: Customer Relationship Management

Financial Services


Financing Views

Define Financing Views:

Financial Services


Financing Views

Assign Condition Functions to

Financing View for Customer Financing View for Subsidy Financing View for Participation Financing View for Effective Interest Customer Relationship Management Financing Views: In this Customizing activity, you define which additional condition functions are to be used to calculate subsidies and participations. In this example, these are the delta conditions for the customer interest rate. You can also enter the additional condition functions, such as discount conditions, to be used in the calculation. In the calculation procedure, you can freely configure the algorithm that determines the precise calculation of subsidies and participations. Customer Relationship Management

Financial Services


Configure FIMA Calculation Procedure

Configure

Calculation Sequence: In this Customizing activity, you specify the sequence for calculating the different financing views.

Result The system creates and saves a cash flow and a payment schedule for the Customer View . It creates and saves the payment schedule for the Participation , Subsidy , and Effective Interest views.

More Information Third-Party Business Relationships

1.4 Calculation Procedure The calculation procedure is central to financial mathematics calculation. You use this procedure to define the sequence in which calculations are performed across different financing views and using different calculation types (such as calculation of the lease installment payment or of the interest rate). You can define any number of calculation procedures and calculation s equences in Customizing. Standard Customizing contains the following calc ulation procedures: FM_001 - Calculate Payment Amount FM_002 - Calculate Nominal Interest FM_003 - Calculate Amount Financed FM_009 - Calculate Cash Flow Data is not calculated in advance in this procedure according to a parameter but the system directly generates the cash flow according to the specifications of the payment structure. Configuration of the c alculation procedure includes the definition of the calc ulation sequence and of the implementations to be used f or each step (Business Add-In BADI_CRM_FIMA_CALC ). You also c onfigure the sequence in which results are updated for the individual financing v iews.

Prerequisites You have performed all the activiti es in Customizing for SAP Customer Relationship Management (SAP CRM) under Financial Services

Leasing


Configure FIMA Calculation Procedure

Customer Relationship Management

.

Activities In the master data of the financing product, you select the required calculation procedure and assign it to a pricing process and, if necessary, to a sub-pricing process. You can assign any number of calculation procedures for each pricing process in the master data of the product. In doing so, you must select one calculation procedure as Default . The system automatically suggests t his procedure in the quotation. However, you can select a different calculation procedure manually.

Note You must have defined a calculation procedure for the New Lease (NEWL) business transact ion. This calculation procedure is copied to all follow-on processes, unless you assign a different calculation procedure to the follow-on process in the product master data.

1.4.1 Effective Interest Rate Calculation PUBLIC © 2014 SAP SE or an SAP affiliate company. All rights reserved.

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Use The effective interest rate is calculated in a special financing view in which the system stores a payment schedule, known as the comparison account, as the basis for the calculation. You assign the legally stipulated methods used to calculate the effective interest rate in the master data of the financing product under Distribution Chains . Leasing supports the current methods, such as AIBD/ISMA. You can specify whether the financial mathematics flows are not relevant for the effective interest rate. You do this in the Customizing activity for excluding flows from a financing view. If you want to make extensive changes to the effective interest payment schedule for a specific customer, you can make these changes in a Business Add-In (BAdI); for example, you can use a BAdI to calculate an effective interest rate for a customer. We provide default implementations for creating the Effectiv e Interest Rate financing view and for calculating the effectiv e interest rate for the lessor. The system copies the payment schedule created by financial mathematics to the customer view. It also copies the payment schedule for all other financing views (such as the subsidy view). The calculation algorithm determines the lessor's return on investment for this payment schedule.

Prerequisites You have made the following settings in Customizing for Customer Relationship Management under

FinancialServices

Leasing

Financial

Mathematics Settings: Specified that the financial mathematics flows are not relevant for the effective interest rate : Financing Views

Exclude Flow Categories from a View.

Configured the BAdI f or calculating the less or's return on investment: Configure FIMA Calculation Procedure

Business Add-Ins

CRM FIMA Calculation Procedure

BAdI: Calculation.

Note You do not execute the calculations you need for the accrual of payments in lease accounting in the CRM system but in the lease accounting system that recalculates on request the effective interest rates required for the accrual.

1.5 Calculation of Rate per Thousand Use The rate per thousand adjusts the calculated installment of a payment step to fit the amount financed. The rate per thousand is calculated as follows: Rate per thousand = (installment amount / amount financed) * 1000 The rate per thousand then specifies how many currency units a customer has to pay for each thousand currency units of the amount financed.

1.6 Interim Periods Use Interim periods are broken periods that, unlike regular periods, have a reduced or ex tended duration. Interim periods are common at the beginning of a leasing transaction to bridge the period between the delivery of a leased object and the next whole accounting period. All the c alculation attributes that y ou can assign to a regular period can also be assigned to an interim period, and vic e versa. You can define interim periods in the payment structure at any time during the term of a contract. To map the following interim periods, you use t he general flow categories for annuities, repayments, interest or fees, combined with the attributes from the payment structure (such as Pro Rata Calculation ): Interest and repayment Interest payment for this period Zero payment, interest carried forward to subsequent periods Fee Calculation of the installment f or the interim period depends on the s elected flow category and on the implementation of the related calc ulation procedure. You enter the flow category in the f inancing template for the interim period.

Example Monthly fee of USD 100; in arrears at the end of the month, to be calculated for 15 days:

Attribute for Pro Rata Calculation

Amount in USD

Not included

0.00

Pro rata calculation

50.00

Included in entirety

100.00

1.7 Interest Calculation Methods and Types


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Use You can use the following types of interest calculation in leasing: Linear interest c alculation The interest amount is c alculated according to the following formula: Amount = calculation base amount * percentage / 100 * interest calculation method

Interest calculated linearly is not capitalized in leasing. Exponential interest calculation The interest amount is c alculated according to the following formula: Amount = calculation base amount * (q ** (interest calculation method) - 1)

Interest calculated linearly is not capitalized in leasing. As a result, planned but unpaid interest is transferred to subsequent periods in sums so that it can be deducted succ essively from the next payment installments (principle of simple daily interest ). You can also use various interest calculation methods to calculate interest using different calculation bases. The calculation methods are always based on the specific number of days in the c alculation period in relation to the defined number of days for the c alendar year – that is, according to the quotient DAYS/DAY_BASE. You can use the following interest calculation methods in leasing: 360E/360 The system always assumes 30 days per month when calculating the interest between two dates; a year with 360 days is assumed. act/360 The system uses the actual number of calendar days to calculate the interest between two dates; a year with 360 days is assumed. act/365 The system uses the actual number of calendar days to calculate the interest between two dates; a year with 365 days is assumed. act/actY The system uses the actual number of calendar days to calculate the interest between two dates; the actual number of days in the calendar year is assumed. 365/365 The system uses the actual number of calendar days to calculate the interest between two dates; the extra day in a leap year (February 29) is not included in the calculation period. A year with 365 days is assumed. Act/Ac tE The system uses the actual number of calendar days to calculate the interest between two dates; a calendar year with 366 days is assumed if the extra day in a leap year (February 29) is included in the calc ulation period, otherwise a calendar year with 365 days is ass umed.

You should not use the f ollowing calculation methods in leasing: ActW/252 365.25/360 365/360

Activities You assign the interest calculation method in the master data in the financing product for each financing view. You also assign the interest calculation type (linear or exponential) to the financing v iew.

For each condition in the payment structure it is possible to use a different interest calculation method to that which you want to use for the financing as a whole. The specified calculation type (exponential or linear) applies to the entire financing view. If you want to perform linear calculations, you can make an exception only depending on the flow category and specifically for zero payments with interest capitalizations.

1.8 Floating Rate Adjustment PUBLIC © 2014 SAP SE or an SAP affiliate company. All rights reserved.

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If the nominal interest rate of a lease is linked to a particular reference interest rate, such as LIBOR or EURIBOR, you can use this function to flexibly adjust the nominal interest rate to the c hanges to the reference interest rate. If the installments to be paid are to be adjusted to the interest rate fluctuations, you can flexibly link the nominal payable rate to a reference rate. The nominal interest rate is adjusted on the date on which the reference interest rate is changed. You can use the prior days to enter a date of interest rate determination that is different to the interest rate adjustment date. In the case of payment structures with annuities, the periods in the past are fixed. This means that the payment, interest, and repayment remain the same. The system recalculates the payments for future settlement periods accordingly. Here you can select the period from which the payments are recalculated. The payments are fixed f or the periods between the fixed and recalculated periods; only the interest/ repayment split is changed. You can change the reference interest rate on any date i n a settlement period, and therefore several times in a settlement period. The various nominal interest rates that can occur in a settlement period as a result are settled to the day. You can adjust documents ad hoc (to any date) or periodically (to period boundaries). You do not have to individually process the contracts that need to be adjusted; instead you can execute mass document processing. Before the start of processing, you can select whether evaluation data about the interest rate adjustment run is sav ed to the database, and is then available for reporting.

Prerequisites You have defined and entered the reference interest rates you require and assigned these to the c orresponding reference interest profile in Customizing for SAP Customer Relationship Management (SAP CRM). You have to make additional settings in the reference interest profile. These include whether the profile is a periodic or ad hoc adjustment profile and the appointment types in which the adjustment dates are stored. Customer Relationship Management

Financial Services

Leasing


Edit Reference Interest Rate

.

In the financing product you must define the reference interest profile to which the adjustment is linked. In the financing views set you assign the reference interest profile to the base financing view. The system checks these conditions before adjustment. It selects only documents with this reference interest profile. If you use customer-specific fields in the database table CRMD_FS_FRA, you have to fill these using the Business Add-In

BADI_CRM_FS_FRA_INDEX . Customer Relationship Management Customer-Specific Fields in Index Table

Financial Services

Leasing


Floating Rate Adjustment

BAdI: Fill

.

Features The following functions are av ailable: To optimize performance, floating rate adjustment for contracts is executed in a mass run using parallel processing. You trigger the process by choosing Execute Floating Rate Adjustment (CRM_FS_FRA ). On the selection screen, you can restrict the selection by entering various criteria. You can use the Business Add-Ins (BAdIs) for the enhancement spot CRM_FS_FRA_TOOLS to influence the floating rate adjustment as follows: Business Add-In

Description

BADI_CRM_FS_FRA_CHECKS

Checks the specific conditions that must be met before a document can be adjusted. If the document does not meet these conditions, the interest rate is not adjusted. However, a next adjustment date is entered so that the document can be adjusted the next time.

BADI_CRM_FS_FRA_INT_ADJDATE

Determines the ne xt adjustment date. In the standard system, the reference interest profile and the period boundaries determine the next adjustment date.

BADI_CRM_FS_FRA_PAYM_ADJDATE

Determines the payment adjustment date (the date from which the payment is recalculated ). In the standard system, the payment ad justment date is the next period boundary after the interest rate adjustment date.

BADI_CRM_FS_FRA_INDEX

Fills the customer-specific fields of the da tabase table C RMD_FS_FRA. You can also decide whether individual items in a document are saved in the database table.

During adjustment, the system differentiates between three types of installments: Fixed installment: Installments that are in the past Constant installment: Ins tallment with new interest/repayment portion Recalculated installment: Periods that are after the adjustment are recalculated in the standard system You can identify a floating rate adjustment in the adjusted document by the following criteria: The conditions of the f loating rate adjustment have been updated.

Example Condition 41M9: The current reference interest rate is filled from the reference interest rate table. The payment structure has been adjusted.

Example The schedule line tables, t he payment and/or interest details, are filled. The payment schedule has been adjusted, such as if an installment has been changed. The cash flow has been adjusted. If an adjustment is performed within a period, the system displays two interest rate values and one repayment result for this settlement period. This indicates the split between the old and the new interest rate. The interest rate adjustment dates (last adjustment date and, if applicable, next adjustment date) have been updated. For an example of a floating rate adjustment, s ee Floating Rate Adjustment: Example.


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More Information Interest Rate Adjustment f or Leasing Documents Evaluation of Successful Interest Rate Adjustment Evaluation of Interest Rate Adjustment in Documents Containing Errors

1.8.1 Interest Rate Adjustment for Leasing Documents You can use this function to adjust interest rates for leasing documents using mass processing. On the CRM WebClient user interface, you can integrate the Execute Interest Rate Adjustment transaction (CRM_FS_FRA ) in the Toolbox area.

Note See SAP Note 993315.

Features In the case of floating rate adjustment, you can use the index table CRMD_FS_FRA to s elect documents in a flexible and high-performing manner. You can enhance this table with customer-specific fields.

Note If you use customer-specific fields, y ou must fill these using the Business Add-In (BAdI) Fill Customer-Specific Fields in Index Table (BADI_CRM_FS_FRA_INDEX ). For more information, see the SAP Implementation Guide (IMG) under Financial Mathematics Settings

Floating Rate Adjustment

Customer Relationship Management

Business Add-Ins (BAdIs)

Financial Services

Leasing

BAdI: Fill Customer-Specific Fields in Index Table

.

On the selection screen, a logical database, which links to the index table, provides both freely definable standard fields (such as Object ID, Reference Interest Profile) and freely definable customer-specific fields (such as Status). Execute Periodic Adjustment : Indicates whether a periodic or ad hoc adjustment is exec uted (it is significant only for periodic reference interest profiles).

Note If you want to adjust a document to a specific date, do not set this indicator. You can make the following entries on the selection screen: Adjustment Date : In the cas e of an ad hoc adjustment, the sy stem adjusts all the selected documents t o the specified date. In the case of documents that are adjusted periodically, the system selects all documents whose next adjustment date lies before the entered date. Simulation/Test Run : Here you indicate whether the adjustments to t he document are to be saved to the database, or whether this is a t est run. The storage of log and results evaluations is independent of this indicator. Dialog Processing : If you set t his indicator, the sys tem executes adjustment in dialog mode; if not, it executes adjustment in the background. You need to set this indicator for debugging, for example. Adjustment Run ID : Each mass run requires a unique ID number, which you must define. This ID is used later to read the results evaluation from the database or call the Postprocessing Office (PPO ). We recommend you store the selection data as a variant. Maximum Package Size for Processing : During mass processing, the sys tem groups the documents to be adjusted into packages. The package size indicates how many documents are to be contained in a package. Reduced Pricing Use Procedure : Specifies whether a reduced pricing procedure is to be used. Pricing Procedure : Restricts the pricing for the financing item and the billing request item (BRI) in financial mathematics.

Note You must use the two fields f or reduced pricing together. Evaluation of Results : You can decide whether the results are evaluated. The sys tem displays only those documents that were adjusted success fully. Documents that c ontain errors are not dis played. Conditions to Be Evaluated : The syst em saves the condition information for an evaluation to the database (if you have set the Evaluate Results indicator). In addition to these fields, you can display and fill all fields in the table CRMD_FS_FRA . When the system executes floating rate adjustment, it adjusts all the selected documents that meet the prerequisites. The system also adjusts the pricing for all subsequent documents and recalculates the payment schedule.

1.8.2 Evaluation of Successful Interest Rate Adjustment You can use this function to display evaluation data that is collected during a floating rate adjustment and saved to the database. On the CRM WebClient user interface, you can integrate the Analyze Interest Rate Adjustment transaction in the Toolbox area.

Note See SAP Note 993315.


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Activities On the selection s creen, enter the adjustment run ID and the adjustment run variant. The ev aluation provides you with the following general information: Mass run ID/adjustment run ID Variant of the adjustment run Reference interest profile Adjustment date Simulation run In addition, detailed information is displayed in table form at contract or item level: Document number Item number Adjustment status Reason for the status The following information is also displayed f or documents containing values (payments and/or interest) that have been changed by the adjustment run: Installment before adjustment Installment after adjustment Condition information before and after adjustment (information from the conditions that were select ed in the adjustment run) Condition type Condition values (old and new) Condition and document currency

1.8.3 Evaluation of Interest Rate Adjustment in Documents Containing Errors You can use this function to display all the documents that the system could not process during an interest rate adjustment run because they contain errors. You can then correct these errors manually. To do this, you use the functions of the Postprocessing Office (PPO) .

Features Postprocessing Office (PPO): All errors that occur during an interest rate adjustment run are logged in the PPO (transaction: /N/SAPPO/PPO2 ) with the adjustment run ID and are saved under the c omponent CRM-IFS . The results of simulation runs are saved under the business process FRA_SIM and the results of adjustment runs are saved under the business process FRA. The business process ID is the ID that you assigned to the interest rate adjustment run. Postprocessing Desktop: initial screen Here you enter the required selection c riteria and trigger the evaluation run. Postprocessing Desktop: overview screen The overview screen displays all the leasing documents that match your selection criteria. A traffic light icon indicates the status of each error. The following statuses are possible: Red: The error is new or has not yet been processed. Yellow: The error is being processed. The user currently processing the error is displayed in the Processor column. Green: Completed. The processor has fixed the error and set this status; you can now repeat the adjustment run manually.

Note You have to set the status to Completed because otherwise the syst em reselects and redisplays the affected items. Detailed information about the individual entry You can double-click an entry to display more detailed information. You can t hen: Change the status of the entry. Display the relevant lease by choosing the processing method DISPLAY . (The contract i s then displayed on the CRM WebClient UI.) You can also v iew the following information: The date on which the entry was c reated in the PPO. All relevant, logged messages.

More Information For more information about the Postprocessing Office , see Postprocess ing Office.

1.8.4 Floating Rate Adjustment: Example The following lease is to be adjust ed to the reference interest rate: Lease

Contract start date

02/01/05

Term

12 months

When due in period

At end of period

Amount financed

USD 11,000

Residual value

USD 1,100


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Reference interest rate

7%

Interest rate

5%

Installment

USD 941

Adjustment date

03/16/05

Current reference interest rate

8%

New interest rate

6%

New installment

USD 946

Payment sc hedule before interest rate adjustment: Description

Payment Date

Crcy

Amount

Interest

Repayt

Outstanding

Calc. Fr om

C alc. To

D ue

Principal

Amount

02/01/05

USD

11,000.00-

0.00

11,000.00

11,000.00

02/01/05

02/01/05

02/01/05

Annuity

03/01/05

USD

941.00

44.82

896.18

10,103.82

02/01/05

03/01/05

03/01/05

Annuity

04/01/05

USD

941.00

41.16

899.84

9,203.98

03/01/05

04/01/05

04/01/05

Annuity

05/01/05

USD

941.00

37.50

903.50

8,300.48

04/01/05

05/01/05

05/01/05

Annuity

06/01/05

USD

941.00

33.82

907.18

7,393.30

05/01/05

06/01/05

06/01/05

Annuity

07/01/05

USD

941.00

30.12

910.88

6,482.42

06/01/05

07/01/05

07/01/05

Annuity

08/01/05

USD

941.00

26.41

914.59

5,567.83

07/01/05

08/01/05

08/01/05

Annuity

09/01/05

USD

941.00

22.68

918.32

4,649.51

08/01/05

09/01/05

09/01/05

Annuity

10/01/05

USD

941.00

18.94

922.06

3,727.45

09/01/05

10/01/05

10/01/05

Annuity

11/01/05

USD

941.00

15.19

925.81

2,801.64

10/01/05

11/01/05

11/01/05

Annuity

12/01/05

USD

941.00

11.41

929.59

1,872.05

11/01/05

12/01/05

12/01/05

Annuity

01/01/06

USD

941.00

7.63

933.37

938.68

12/01/05

01/01/06

01/01/06

Annuity

02/01/06

USD

941.00

3.82

937.18

1.50

01/01/06

02/01/06

02/01/06

02/01/06

USD

1.50

0.00

1.50

0.00

01/01/06

02/01/06

02/01/06

Residual value 02/01/06

USD

0.00

0.00

0.00

0.00

02/01/06

02/01/06

02/01/06

financed

Balance settlement

Cash flow before interest rate adjustment:

Note AA: Inflow (generic) SS: Outflow (generic) TZ: Nominal interest TL: Payment ins tallment (interest and repayment)

FIMA

Due

Payment Date

Currency

Amount Causing Calc. From

Calc. To

Calc. Date

Days

Change

AA

02/01/05

02/01/05

USD

11,000.00

02/01/05

02/01/05

02/01/05

0

TZ

03/01/05

03/01/05

USD

44.82

02/01/05

03/01/05

03/01/05

30

TL

03/01/05

03/01/05

USD

941.00

02/01/05

03/01/05

03/01/05

30

TZ

04/01/05

04/01/05

USD

41.16

03/01/05

04/01/05

04/01/05

30

TL

04/01/05

04/01/05

USD

941.00

03/01/05

04/01/05

04/01/05

30

TZ

05/01/05

05/01/05

USD

37.50

04/01/05

05/01/05

05/01/05

30

TL

05/01/05

05/01/05

USD

941.00

04/01/05

05/01/05

05/01/05

30

TZ

06/01/05

06/01/05

USD

33.82

05/01/05

06/01/05

06/01/05

30

TL

06/01/05

06/01/05

USD

941.00

05/01/05

06/01/05

06/01/05

30

TZ

07/01/05

07/01/05

USD

30.12

06/01/05

07/01/05

07/01/05

30

TL

07/01/05

07/01/05

USD

941.00

06/01/05

07/01/05

07/01/05

30

TZ

08/01/05

08/01/05

USD

26.41

07/01/05

08/01/05

08/01/05

30

TL

08/01/05

08/01/05

USD

941.00

07/01/05

08/01/05

08/01/05

30

TZ

09/01/05

09/01/05

USD

22.68

08/01/05

09/01/05

09/01/05

30

TL

09/01/05

09/01/05

USD

941.00

08/01/05

09/01/05

09/01/05

30

TZ

10/01/05

10/01/05

USD

18.94

09/01/05

10/01/05

10/01/05

30

TL

10/01/05

10/01/05

USD

941.00

09/01/05

10/01/05

10/01/05

30

TZ

11/01/05

11/01/05

USD

15.19

10/01/05

11/01/05

11/01/05

30

TL

11/01/05

11/01/05

USD

941.00

10/01/05

11/01/05

11/01/05

30


Page 12 of 14

TZ

12/01/05

12/01/05

USD

11.41

11/01/05

12/01/05

12/01/05

30

TL

12/01/05

12/01/05

USD

941.00

11/01/05

12/01/05

12/01/05

30

TZ

01/01/06

01/01/06

USD

7.63

12/01/05

01/01/06

01/01/06

30

TL

01/01/06

01/01/06

USD

941.00

12/01/05

01/01/06

01/01/06

30

TZ

02/01/06

02/01/06

USD

3.82

01/01/06

02/01/06

02/01/06

30

TL

02/01/06

02/01/06

USD

941.00

01/01/06

02/01/06

02/01/06

30

SS

02/01/06

02/01/06

USD

0.00

02/01/06

02/01/06

02/01/06

0

Payment schedule after interest rate adjustment: Description

Payment Date

Crcy

Amount

Interest

Repayt

Outstanding

Calc. Fr om

C alc. To

D ue

Principal

Amount

02/01/05

USD

11,000.00-

0.00

11,000.00-

11,000.00

02/01/05

02/01/05

02/01/05

Annuity

03/01/05

USD

941.00

44.82

896.18

10,103.82

02/01/05

03/01/05

03/01/05

Annuity

04/01/05

USD

941.00

45.17

895.83

9,207.99

03/01/05

04/01/05

04/01/05

Annuity

05/01/05

USD

946.00

44.82

901.18

8,306.81

04/01/05

05/01/05

05/01/05

Annuity

06/01/05

USD

946.00

40.43

905.57

7,401,24

05/01/05

06/01/05

06/01/05

Annuity

07/01/05

USD

946.00

36.03

909.97

6,491.27

06/01/05

07/01/05

07/01/05

Annuity

08/01/05

USD

946.00

31.60

914.40

5,576.87

07/01/05

08/01/05

08/01/05

Annuity

09/01/05

USD

946.00

27.15

918.85

4,658.02

08/01/05

09/01/05

09/01/05

Annuity

10/01/05

USD

946.00

22.67

923.33

3,734.69

09/01/05

10/01/05

10/01/05

Annuity

11/01/05

USD

946.00

18.18

927.82

2,806.87

10/01/05

11/01/05

11/01/05

Annuity

12/01/05

USD

946.00

13.66

932.34

1,874.53

11/01/05

12/01/05

12/01/05

Annuity

01/01/06

USD

946.00

9.12

936.88

937.65

12/01/05

01/01/06

01/01/06

Annuity

02/01/06

USD

946.00

4.56

941.44

3.79-

01/01/06

01/01/06

02/01/06

02/01/06

USD

3.79-

0.00

3.79-

0.00

01/01/06

01/01/06

01/01/06

Residual value 02/01/06

USD

0.00

0.00

0.00

0.00

01/01/06

01/01/06

01/01/06

financed

Balance settlement

Cash flow after interest rate adjustment: FIMA

Due

Payment Date

Currency

Amount Causing Calc. From

Calc. To

Calc. Date

Days

Change

AA

02/01/05

02/01/05

USD

11,000.00

02/01/05

02/01/05

02/01/05

0

TZ

03/01/05

03/01/05

USD

44.82

02/01/05

03/01/05

03/01/05

30

TL

03/01/05

03/01/05

USD

941.00

02/01/05

03/01/05

03/01/05

30

TZ

04/01/05

04/01/05

USD

20.56

03/01/05

03/16/05

03/16/05

15

TZ

04/01/05

04/01/05

USD

24.61

03/16/05

04/01/05

04/01/05

15

TL

04/01/05

04/01/05

USD

941.00

03/01/05

04/01/05

04/01/05

30

TZ

05/01/05

05/01/05

USD

44.82

04/01/05

03/01/05

03/01/05

30

TL

05/01/05

05/01/05

USD

946.00

04/01/05

03/01/05

03/01/05

30

TZ

06/01/05

06/01/05

USD

40.43

03/01/05

06/01/05

06/01/05

30

TL

06/01/05

06/01/05

USD

946.00

03/01/05

06/01/05

06/01/05

30

TZ

07/01/05

07/01/05

USD

36.03

06/01/05

07/01/05

07/01/05

30

TL

07/01/05

07/01/05

USD

946.00

06/01/05

07/01/05

07/01/05

30

TZ

08/01/05

08/01/05

USD

31.60

07/01/05

08/01/05

08/01/05

30

TL

08/01/05

08/01/05

USD

946.00

07/01/05

08/01/05

08/01/05

30

TZ

09/01/05

09/01/05

USD

27.15

08/01/05

09/01/05

09/01/05

30

TL

09/01/05

09/01/05

USD

946.00

08/01/05

09/01/05

09/01/05

30

TZ

10/01/05

10/01/05

USD

22.67

09/01/05

10/01/05

10/01/05

30

TL

10/01/05

10/01/05

USD

946.00

09/01/05

10/01/05

10/01/05

30

TZ

11/01/05

11/01/05

USD

18.18

10/01/05

11/01/05

11/01/05

30

TL

11/01/05

11/01/05

USD

946.00

10/01/05

11/01/05

11/01/05

30

TZ

12/01/05

12/01/05

USD

13.66

11/01/05

12/01/05

12/01/05

30

TL

12/01/05

12/01/05

USD

946.00

11/01/05

12/01/05

12/01/05

30

TZ

01/01/06

01/01/06

USD

9.12

12/01/05

01/01/06

01/01/06

30

TL

01/01/06

01/01/06

USD

946.00

12/01/05

01/01/06

01/01/06

30


Page 13 of 14

TZ

02/01/06

02/01/06

USD

4.56

01/01/06

02/01/06

02/01/06

30

TL

02/01/06

02/01/06

USD

946.00

01/01/06

02/01/06

02/01/06

30

SS

02/01/06

02/01/06

USD

0.00

02/01/06

02/01/06

02/01/06

0


Page 14 of 14

Financial Mathematics in Leasing

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