Tools · IFRS 9
IFRS 9 effective interest rate (EIR) calculator
A loan with origination fees or a premium isn't carried at face value on day one — it's carried at net proceeds, and the difference unwinds through P&L at the effective interest rate. Enter the terms, and this calculator solves for the EIR and lays out the amortised-cost schedule.
Effective interest rate
5.47%
Net proceeds (day 1)
AED 980,000.00
Coupon rate
5.00%
Total IFRS interest
AED 270,000.00
Amortised cost schedule
| Year | Amortised cost (open) | Interest (P&L) | Coupon paid | Amortised cost (close) |
|---|---|---|---|---|
| 1 | 980,000.00 | 53,585.82 | 50,000.00 | 983,585.82 |
| 2 | 983,585.82 | 53,781.89 | 50,000.00 | 987,367.72 |
| 3 | 987,367.72 | 53,988.69 | 50,000.00 | 991,356.40 |
| 4 | 991,356.40 | 54,206.79 | 50,000.00 | 995,563.19 |
| 5 | 995,563.19 | 54,436.81 | 50,000.00 | 0.00 |
The EIR is the rate that exactly discounts the expected future cash flows to the net carrying amount at initial recognition (IFRS 9 B5.4.1). The difference between EIR interest and coupon paid unwinds the fees/premium over the instrument’s life.
Disclaimer
Illustrative figures computed in your browser. Nothing is uploaded, stored or sent anywhere. Not accounting or tax advice; verify treatment with your advisor.