<< Click to Display Table of Contents >> Navigation:  Through the Menus > Administration > Monthly Routines > Middle of Month - Tenant Statements > Charge Interest to Units (Tenants) on Overdue Balances (Daily per Property)

This option is used to Raise Interest on Unit Overdue Balances in cases where the full amount due was not paid prior to the date set for the Property's by means of the control flags in Maintenance - For Your Clients - Property (Owner). If no date has been set, then the program will use the 7th (of any given month) as its default date.
i.e. if the full amount due is not paid on the 7th of the month, interest will be charged from the 1st of the month.
The interest is calculated based on the actual dates of the transactions - all billing is assumed to be due on the 1st of the month.

For Month-End Cut-off Structures:

Since Unit Statements are printed at mid-month, while month-end balances are stored at calendar month end, this interest is calculated in respect of the previous month. If there is a balance due on the 7th,the system calculates the interest using the relevant interest rate, as set up for the Property or Unit.

e.g. In a scenario where the Current Cash Period is December and Unit Statements are being run for January, this program would be run on about the 15th of December. It looks at the balance on 7th November (assuming that all billing was due on the 1st of November), and only calculates interest if this balance is greater than zero. Interest is calculated for all transactions in November, as well as any opening balance at the beginning of November, based on the number of days for which they are outstanding.

Since the interest appears on the January statements, but is in respect of November, this interest effectively two months in arrears.

The default period, when running this program, is the month prior to the current month.

Mid-Month Cut-off Structures

Unit statements are printed at mid-month, which is also the system month-end. This means that interest is calculated in respect of the current month. If there is a balance due on the 7th,the system calculates the interest using the relevant interest rate, as set up for the Property or Unit.

e.g. In a scenario where the Current Cash Period is December and Unit Statements are being run for January, this program would be run on about the 15th of December. It looks at the balance on 7th November (assuming that all billing was due on the 1st of November), and only calculates interest if this balance is greater than zero. Interest is calculated for all transactions in November, as well as any opening balance at the beginning of November, based on the number of days for which they are outstanding.

Since the interest appears on the January statements, but is in respect of November, this interest effectively two months in arrears.

The default period, when running this program, is the month prior to the current month.

 

Notes for both structures:

The interest is charged into the Billing Period (Next month), which in the above examples, would be January.

The system has alternate interest calculation programs that are based on the actual transaction dates.
Refer to How do I Charge Interest on arrear rentals/levies.

When running the above option, the system produces an unposted Sundry Adjustment that must be posted  by means of the relevant screen.