Calculation of Funds

INTEREST=PRINCIPALXTIME X RATE OF INTEREST/100

Principal means total progressive balance of progressive Balance of each month for the last 12 months.

Rate of Interest is applicable under rules for the financial year i.e. for the year 2004-05.

Rate of Interest = 8% and time = number of months of progressive balance/12 (or number of years)

Formula applicable as model examples for calculation of Interest.

Suppose Closing balance as on 31st March 2005 in respect of subscriber 'A' is Rs. 48,000/- and monthly subscription = Rs. 2000/-P.M. Monthly rate of advance is Rs. 1000/- P.M.

Rate of Interest on GPF for the year 2005-2006 = 8%

Closing Balance as on 31 st March 2005 is Rs.48000/-

Month Subscription Refund Advance/ Withdrawal Rs. Progressive Balance
  April 2005 2000 1000 51,000
  May 2005 2000 1000 54,000
  June 2005 2000 1000 57,000
  July 2005 2000 1000 60,000
  August 2005 2000 1000 63,000
  September 2005 2000 1000 66,000
  October 2005 2000 1000 NIL 69,000
  November 2005 2000 1000 72,000
  December 2005 2000 1000 75,000
  January 2006 2000 1000 78,000
  February 2006 2000 1000 81,000
  March 2006 2000 1000 84,000
      Total 8,10,000

Interest as on 1 st April 2006 = 8,10,000/- X 1/12 X 8/100 = Rs. 5400/-

Total Progressive Balance at the end of the year.

(B) Example ‘B’ for part of a year:-
Closing Balance as on 31 st March 2003 is Rs.52000/-

Month 2004 Subscription Refund Advance/ Withdrawal Rs. Progressive Balance
  April 2000 500 54,500
  May 2000 500 57,000
  June 2000 500 6000 53,500
  July 2000 500 56,000
  August 2000 1000 59,000
  September 2000 1000 62,000
  October 62,000
  November 62,000
      Total 4,66,000

Interest 4,66,000 X 1/12 X 8/100 = Rs. 3,106.67
Rounded off to Rs. 3,107/-