What is interest on arrears accrued but not settled in SAP FS-AM - Account Management?

SAP Term: interest on arrears accrued but not settled

• Component: FS-AM

• Component Name: Account Management

• Description: This is pro rata interest on arrears that the system has not yet posted, for the analysis period from the contract start until the key date. The system supports accrued interest on arrears only for loans that use the payment plan principle. The system calculates and displays the accrued interest on arrears dependent on the working rule of the product.

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• Key Concepts: 
  Interest on arrears accrued but not settled is a term used in SAP's FS-AM Account Management component. It refers to the interest that is calculated on overdue payments that have not yet been paid. This interest is calculated based on the amount of time the payment has been overdue and the interest rate set by the company. 
  
  How to use it: 
  In order to use this feature, companies must first set up an interest rate in the system. This rate will be used to calculate the interest on overdue payments. Once this is done, the system will automatically calculate the interest on any overdue payments and add it to the total amount due. 
  
  Tips & Tricks: 
  It is important to keep track of any overdue payments and ensure that they are paid as soon as possible in order to avoid incurring additional interest charges. Additionally, companies should review their interest rate periodically to ensure that it is still appropriate for their business needs. 
  
  Related Information: 
  For more information about this feature, please refer to SAP's documentation on FS-AM Account Management. Additionally, there are many online resources available that provide more detailed information about how to use this feature in SAP.