For discounted export bills partially liquidate the principal before the maturity date of the bill. In this case, correction entries will be passed for the:

• Interest that has been collected in advance and
• Interest receivable in the future along with the respective accruals/amortization as the case

For example, you have entered a bill worth USD 20000 in Oracle Banking Trade Finance on 1 February 2001. The bill expires on 31 March 2001. Original Interest calculation period: 01 Feb to 31 March 2001 On 08 Feb you partially liquidate USD 8000 of the Original Bill Amount. The excess interest that should be refunded to the customer is derived as follows:

• Interest collected in advance on USD 20000 = X
• Interest on 20000 between 1 Feb to 7 Feb 01 = Y
• Interest on 12000 between 1 Feb to 7 Feb 01 = Z
• Excess interest refunded to the customer = X - (Y+Z)

Accrual adjustment entries as on 11 Feb 2001 (the liquidation date)

• Accruals already done on interest between 1 Feb to 10 Feb 2001 = A
• Interest calculated on 20000 between 1 Feb 01 to 7 Feb 01 = B
• Interest calculated on 12000 between 8 Feb 01 to 11 Feb 01 = C
• Accrued interest after partial liquidation = (B + C) – A