It's very practical... Accrued Interest

There have been some changes made to the look of FCC Statements. The major change that has been made to the crop input transaction statement is that the statement will no longer show the monthly accrued interest for each individual month. You will now see the cumulative balance of your accrued interest each month. Some concern may arise from these changes and this blog is here to help answer any questions you might have.

What does it look like?

• The accrued interest on your crop input transaction statement will now show as a cumulative balance at the end of the statement period.
• To determine the accrued interest for one month you will need that month’s statement and the statement of the month prior.
• The cross-over from the old statement format to the new statement format will be a different, one-time, calculation.

Practically speaking

Let’s look at how to enter your transactions into AgExpert Analyst.

1. The accrued interest from the old format to the new format will be calculated by subtracting the September accrued interest from the August accrued interest.
   
   
   
2. The new format now shows the total cumulative accrued interest instead of what your accrued interest is for each individual month. To calculate the monthly accrued interest for October you will need both September’s statement and October’s.
   
   
   
3. Pay accrued interest on your crop input loan.
   
4. Annually, you will receive a loan statement that will show what interest was actually posted to your account that fiscal year.  You will need to do a year end adjusting entry once you receive this statement. Once the adjustment is complete, the ending balance on your loan statement should match the balance on your loan account in AgExpert Analyst.
   
   

Best Practices

• Don’t panic, if you have any questions or need any assistance we are always here to help.
• Keep your crop input transaction statements organized so that you have everything you need to make the month-to-month calculations.
• Top Tip - Please refer to www.fcc-fac.ca/statements  for more information about both the Transaction Statement and the Annual Loan Statement. You can also call the Customer Service Centre at 1-888-522-2555.
• In reconciling your loan every month, you no longer reconcile against a single loan statement balance. You will now reconcile your accrued interest balance against your accumulated interest FCC input loan payable account and the closing balance to your loan account.