PURPOSE
This document describes the procedure for the computation of bond premium/ discount.
WHY IS THIS IMPORTANT?
This allows users to verify the formula and methodology used by CS Lucas to compute bond premium/ discount.
FORMULA
The example below shows how the system compute the bond premium/ discount.
Month end journals at 30 Nov 2019.
Amortised Cost at 30-Nov-2019 = 102.081440006008 (refer “CLOSING” from amortised bond query)
Nominal Amount = 1,000,000.00
Carrying Cost = 1,000,000 * 106.736956823838%
= 1,067,369.57
Amount of premium = 1,067,369.57 – 1,000,000.00
= 67,369.57
FREQUENTLY ASKED QUESTIONS
RELATED INFORMATION
CHANGE HISTORY
0 Comments