Is the balance on my vehicle finance statement the capital I owe?

Usually not. On an instalment sale the balance shown is often everything still to be paid: the capital, the interest not yet earned and the fees. Interest should be charged on the capital alone. To check it, the capital has to be rebuilt from the agreement: the amount financed, less the capital part of each payment made.

How the working goes

Start with the amount financed on the day it was paid out. Interest accrues on that capital day by day at the rate in your agreement. Each payment covers the interest and fees due first, and what is left reduces the capital.

Repeat that for every month and you have the capital the interest should have been charged on. If the statement's balance is used in its place, every interest figure comes out too high, because that balance includes interest that has not been earned yet.

When the rate is linked to prime, a change in prime applies from its effective date, part-way through a month if that is when it falls.

Where Akurra fits

Akurra rebuilds the capital from your agreement and your payments, accrues interest on it day by day, and sets each interest line on your statement against that. It also checks the agreement against itself: whether the instalment it states follows from its own amount, rate and term.