Enter Interest Posting Method

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Select the interest posting method to be used by the agency.

Only those open accounts defined as interest bearing accounts are included in the distribution of interest payments.
The CFMS product has two available posting methods: Monthly (Simple) Interest and Daily (Compound Interest).

Warning: These methods are separate commands which do not recognize interest posted from each other. If the interest posting method is changed, it is possible to post the interest twice in the same month.

Go to: Avatar CFMS > System Maintenance > Enter Interest Posting Method
Define the Interest Posting Method:

Monthly (Simple) Interest - This interest posting method is based on the average daily balance of each account in relation to the total average daily balance of all accounts. It is posted monthly, usually at the end of the month.
Monthly Interest Calculation - Monthly (Simple) Interest per account equals IADB divided by ATDB times the total monthly interest being distributed (amount entered in the Interest Amount field of the Monthly Interest Posting form, where:
- Individual Average Daily Balance (IADB) equals the sum of each of the daily balances divided by the total number of days of the month.
- Average Total Daily Balance (ATDB) equals the sum of each of the total daily balances divided by the total number of days of the month.
Daily (Compound) Interest - This interest posting method is designed for posting at intervals more frequent than monthly.
The total interest per day is posted, multiplied by the number of days between postings. The remainder of the interest is reserved for future postings within the month. Unlike monthly interest posting, the interest to distribute is entered at the beginning of the month and the distribution period (number of days) is determined each time the form is used. See Enter Interest Amount For Daily Posting and Daily Interest Posting.
Daily Interest Calculation - Daily (Compound) Interest per account equals IADB divided by ATDB times the TIPD times the number of days since last posting, where:
- Individual Average Daily Balance (IADB) equals the sum of each of the daily balances divided by the total number of days in the period.
- Average Total Daily Balance (ATDB) equals the sum of each of the total daily balances divided by the total number of days in the period.
- Total Interest Per Day (TIPD) equals the total interest to distribute (entered in the Enter Interest Amount For Daily Posting form) divided by the number of days in the month.

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