> For the complete documentation index, see [llms.txt](https://learn.tryonederful.com/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://learn.tryonederful.com/asc-842/creating-and-activating-a-lease-schedule.md). # Creating and Activating a Lease Schedule Lease information is maintained in individual contract cards. A single contract can contain multiple lease schedules and multiple lease objects (ROU Assets). However, each lease schedule can be associated with only one lease object (ROU Asset). ## Entering Contract Information To create a new lease contract, open a new contract card and complete the required information.

#### Fields * **Lease Type** - Required field that determines how lease accounting transactions will be posted. Available options: * Finance Lease * Operating Lease * **Contract Date** - Specifies the date on which the contract information is entered into the system. In most cases, this date matches the current Work Date. * **Signing Date** - Specifies the date on which the lease agreement was signed. This date is recorded for reference purposes only and is not used in schedule calculations. ## Creating and Calculating a Lease Schedule Once the contract information has been completed, create a lease schedule by selecting **Manage > New**.

After all required information has been entered, the system automatically calculates the lease schedule. No additional calculation action is required. Any changes made to the schedule input parameters automatically trigger a recalculation. #### General * **Schedule No** - Automatically generated based on the Contract No. and schedule sequence number. * **Version No** - Automatically maintained by the system. The first schedule version is always assigned Version No. = 1. Each amendment creates a new version with the next sequential number. * **Version Status** - Automatically maintained by the system. * New - newly created schedule * Valid - confirmed schedule * Old - superseded schedule version * **Schedule Status** - Automatically maintained by the system. Possible statuses include: * Pre-Contract * Active * Expired * Early Buy-Out * Terminated * **Lease Type** - Inherited from the contract card. * **Posting Group** - Determines which General Ledger accounts will be used when posting lease accounting transactions. #### Vendor * **Vendor No.** and **Vendor Name** - Inherited from the contract card. #### Payments * **Pay on Period Start** - Defines when lease payments are assumed to be made. When enabled, payments are considered to occur at the beginning of the period. As a result: * The first schedule line is calculated using Outstanding Amount less Payment Amount. * The Interest Amount on the final schedule line equals zero. * **Last Payment Fine Tune** - Adjusts the calculation of the final schedule line to eliminate rounding differences. * **Up-Front Payments** - Indicates that an up-front payment exists. When enabled, the interest amount on the first schedule line is zero. * **Period Payment (PMT)** - Defines the lease payment amount for each payment period. * **Add Advance Payment** - Enables advance payment functionality. For more information, see **Advance Payments**. #### Interest (Discount) Rate: * **Set Zero Interest Rate** - Enable this option when a zero interest rate should be used. * **Fixed Interest rate** - Defines the annual discount rate used in lease calculations. * **Effective Monthly Interest Rate, %** - Calculated automatically by the system based on the Fixed Interest Rate. #### Schedule Dates * **Schedule Date Calculation** - Use the default value **Last Day of Month**. * **Payment Period** - Defines payment frequency: * Monthly * Quarterly * Half-Yearly * Annually For Quarterly, Half-Yearly, and Annual schedules, the **Payment Month in Period** must also be specified. * **Payment Month in Period** - Specifies the month in which the payment is made for non-monthly schedules. * **Lease Starting Date / Lease Ending Date** - Defines the lease term based on the signed lease agreement. * **Schedule Starting Date / Schedule Ending Date** - Automatically maintained by the system and indicate the actual schedule dates used in calculations. * **Leasing Period (Months)** - Automatically calculated from the Lease Starting Date and Lease Ending Date. * **Activation Date** - Automatically maintained by the system and populated when the schedule is activated. * **Dimensions** - Dimensions can be assigned using Global Dimensions and Shortcut Dimensions. * **BU (Business Unit)** - Can be selected from the available Business Unit list. #### Transition * **Transition Date** - Represents the date on which control of the leased asset is transferred. The Transition Date may differ from the Lease Starting Date and must be entered manually. This field is mandatory before the schedule can be activated. * **First Payment Date** - Used when the first payment occurs in a different month than the Transition Date. #### Liabilities * **Present Value (PV)** - Represents the Net Present Value of future lease payments discounted using the Effective Interest Rate. This amount is recognized as: * Initial Lease Liability * Initial ROU Asset Acquisition Cost * **Short-Term Liabilities** - Represents the portion of liabilities due within the next 12 months. * **Long-Term Liabilities** - Represents the portion of liabilities due after 12 months. ## Adjusting Schedule Lines and Transition Date The payment amount on initial schedule lines depends on the Transition Date. Because the Transition Date does not always match the Lease Starting Date, it must be entered manually before schedule activation. When the Transition Date differs from the Lease Starting Date, the system automatically adjusts the beginning of the schedule and recalculates the payment amount based on the actual number of days in the first period.

Users can also manually modify payment amounts for individual schedule lines. When a payment amount has been modified: * Monthly Pmt. Modified = Yes * The schedule displays a notification indicating that payment lines have been modified.

#### Removing Manual Payment Adjustments To remove all manual payment changes and restore the original schedule calculation, select **Recreate Lines**. The system regenerates the schedule using the current schedule parameters.

Posting Groups ## Posting Groups Posting Groups define the General Ledger accounts used for lease accounting transactions.

#### Fields * **Code** - Unique identifier used for the posting group. * **Lease Type** - Determines whether the posting group is used for a Finance Lease or an Operating Lease. * **Lease Short-Term Liabilities** - General Ledger account used for liabilities due within the next 12 months. * **Lease Long-Term Liabilities** - General Ledger account used for liabilities due after 12 months. * **Interest Expenses** - General Ledger account used for posting interest expenses. * **Accruals Interim Credit Account** - General Ledger account used for lease payment postings within Finance Lease transactions. * **ROU Asset Acquisition Cost Account** - General Ledger account used to record the initial acquisition cost of the Right-of-Use Asset. * **ROU Asset Accumulated Depreciation Account** - General Ledger account used to record accumulated depreciation of the ROU Asset. * **ROU Asset Accumulated Write-Down Account** - General Ledger account used to record ROU Asset write-down transactions. * **ROU Asset Accumulated Appreciation Account** - General Ledger account used to record ROU Asset appreciation transactions. * **Depreciation Account** - General Ledger account used to record depreciation expenses. * **Gains Account on Disposal** - General Ledger account used to record gains resulting from lease termination. * **Losses Account on Disposal** - General Ledger account used to record losses resulting from lease termination. ## Activating a Lease Schedule Once the lease schedule has been reviewed and validated, it can be activated by selecting **Confirm**.

#### Results of Schedule Activation After activation: * Contract Status changes to **Active**. * Schedule Status changes to **Active**. * Version Status changes to **Valid**. * Schedule parameters become read-only. * The schedule can no longer be recalculated. * The Present Value (PV) is posted as both the Lease Liability and the ROU Asset Acquisition Cost. * Initial postings are identical for Finance Leases and Operating Leases.

## Advance Payments Advance payment functionality is used when an initial payment is made to the vendor before regular lease payments begin. To use this functionality: 1. Enable **Add Advance Payment**. 2. Enter the **Advance Payment Amount**. 3. Recalculate the schedule.

After recalculation, the advance payment appears as a separate schedule line with **Line Type = Advance**. #### Posting Results * The advance payment is posted automatically when the schedule is confirmed. * The Advance line is marked as **Accruals Posted = Yes**. * Advance payment entries are created together with Lease Liability and ROU Asset postings. * All entries use the same posting date. For Operating Leases, the assigned Posting Group must contain an **Accruals Interim Credit Account**.

## Managing Schedule Review Dates Some lease agreements require periodic review of lease terms and payment conditions. For example, lease payments may be adjusted annually based on contractual conditions. To help manage these reviews, the system includes **Schedule Review Date** functionality.

### Schedule Review Date Fields Schedule Review Dates can be maintained while the schedule version status is **New**.

After schedule activation, review dates are managed through the **Active Schedule Management** page. ### Updating Schedule Review Dates The Active Schedule Management page allows users to: * Review upcoming review dates. * Add review dates to existing schedules. * Update review dates individually. * Update review dates in bulk.

#### Available Filters * All Active Schedules * Already Expired * Expired and To Be Expired * All with Non-Empty Next Schedule Review Date #### Available Actions * **Update Schedule Review Date** - Updates a single schedule. * **Update Schedule Review Date for All Filtered Overdue Entries** - Updates multiple schedules simultaneously.