Annuity Extended family

The standard annuity functions (PMT etc) extended to allow for industry methods of interest daycount and payment periodicity.

Component	What the name means
PVBF	Present Value of an annuity using industry values for interest daycount and period frequency.
PMTBF	Annuity Payment using industry values for interest daycount and period frequency.
RateBF	Annual interest rate (simple) of an annuity using industry values for interest daycount and period frequency.

This family of functions is for when you want to calculate annuities but are hampered by the fact the annuity in question does to adhere to the restrictive rules of standard annuity formulae ie:

The interest is calculated according to a daycount basis eg ACT/365 or ACT/360 which means that the interest component of the annuity will vary from period to period.
The payment frequency matches consistent calendar days and is therefore irregular in length.

Usually you would have to build a special spreadsheet and use Goalseek to iteratively determine the annuity PMT, or NPVX or BF's PVT to get the PV.

This seems inappropriate because the calculation is a generic one and the spreadsheet is merely calculating interest according to the actual number of days - it is not modelling anything particularly unique to your situation.

What these functions do is do a complete cashflow's calculations internally, and in some cases use a highly efficient iterative technique to derive the answer.

The two 'different' parameters to a normal annuity calculation are DayCount and ŲPeriodsIntŲ. These govern how and when interest is calculated, respectively.

Footnote: The idea for this family came from an investment bank that contacted us enquiring as to whether there was a way to adapt the standard PMT function for when interest was calculated on the 15th of each month on an ACT/360 basis. Well, there wasn't a way to adapt the conventional financial math, but using Business Functions' daycount methodology combined with its solver produced a highly accurate and efficient solution, eliminating the need for separate spreadsheets for each loan.