Appendix - Calculation Notes

Some of the modules in the SCE may return calculation notes when certain situations are encountered during the calculation. These are not errors, but calculation notes which may help to explain something which might not be expected by the end user.

Calculation Notes

All of the calculation notes that may be returned by the SCE are documented below. Each note is associated with a numeric code and text return value. Each will be further described in the list below:

1. "Zero Interest Rule in effect. If IntRate=0, round pmts down, set Interest to zero. Negative Interest always set to zero."

   In the Loan module, there is an field of the BusinessRules object called ZeroInterestRule. If enabled and the interest rate is set to zero, then payments will always be rounded down, no matter what (if any) payment rounding method was specified in the input request. Furthermore, if enabled and the computed interest amount is less than zero, then the interest amount will be set to zero, even if the interest rate is greater than zero.

2. "Oscillator detected and successfully resolved."

   The SCE is an iterative calculation engine, and in certain circumstances, the computed principal balance (which is made up of the amount requested in addition to any amounts which are added to the principal balance) can oscillate back and forth between two values. When this situation occurs and the difference between both values is small enough, one of the two values will be used and the calculation will be completed.

3. "Currently not used."

   This note is currently not implemented.

4. "The Interest Paid, IntPaid, of the final amortization event has been adjusted to make the EndBal zero."

   When amortizing a loan, often times there is a non-zero ending balance due to rounding. The final interest reduction amount has been adjusted to achieve perfect amortization, which results in an ending balance of zero. Note that this will cause the final payment to not equal the sum of the principal reduction amount and amount to interest in the returned amortization schedule.

5. "The Principal Reduction, Prin, of the final amortization event has been adjusted to make the EndBal zero."

   When amortizing a loan, often times there is a non-zero ending balance due to rounding. The final principal reduction amount has been adjusted to achieve perfect amortization, which results in an ending balance of zero. Note that this will cause the final payment to not equal the sum of the principal reduction amount and amount to interest in the returned amortization schedule.

6. "This loan has at least one irregular periods. IRR APR's may not accurately reflect the effective rate."

   When using the IRR APR method, if there is not complete regularity in periods between events, the resulting calculated value may not reflect the true internal rate of return. Consider using the XIRR method when the periodicity is not regular.

7. "The US Rule APR was not computed, but set to the entered rate."

   As requested, the US Rule APR was not computed, but set equal to the entered rate.