> 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/ifrs-16/contract-ending.md).
# Contract Ending
A lease schedule reaches the end of its lifecycle when the related lease liability has been fully settled or the lease is terminated before its contractual end date. The IFRS 16 solution supports both natural lease expiration and premature termination scenarios.
The available contract ending scenarios are:
* Natural Ending
* Premature Termination
## Natural Ending
When accruals are posted for the final schedule line, the system automatically changes:
* Schedule Status = Expired
This status indicates that the lease liability balance has reached zero and the lease schedule has ended according to its original terms.
### Disposing of the Right-of-Use Asset
When a lease expires naturally, the related Right-of-Use (ROU) Asset must also be disposed of.
To simplify this process, the solution provides the **IFRS Expired Schedule FA Disposal** function. This function can be executed for a single schedule or for multiple schedules at once.
If no specific schedule is selected, the system processes all schedules meeting the following criteria:
* Schedule Status = Expired
* Lease liability outstanding amount equals zero
### Disposal Parameters
The disposal posting date can be determined in one of two ways:
* Use the latest Fixed Asset Ledger Entry posting date.
* Specify a custom posting date using **Set Posting Date As**.
### Disposal Results
After the process has been completed successfully:
* The Fixed Asset disposal is posted.
* The asset is marked as disposed.
* The related lease schedule reflects the completed disposal process.
### Disposal Status Log
If the disposal process cannot be completed for certain schedules, the system records the information in the **IFRS 16 Disposed ROU Assets Status Review** log.
This log helps users identify and resolve issues before running the disposal process again.
### Accounting Result
The disposal is posted using the standard Fixed Asset Disposal functionality in Business Central.
After disposal:
* The asset is marked as disposed on the Asset Card.
* The related lease schedule is updated accordingly.
## Premature Termination
If a lease must be ended before its contractual end date, use the **IFRS16 Post Early Termination** function.
After starting the function, the system displays a summary of the lease schedule, including the remaining balances and termination options.
### Termination Types
* **Early Buy-Out**: Select **Early Buy-Out** when the lease ends because ownership of the leased asset is transferred to the lessee.
* **Terminated**: Select **Terminated** when the lease agreement is cancelled or otherwise ended before the contractual expiration date.
The accounting treatment is the same for both options. The only difference is the Schedule Status assigned after posting.
### Termination Results
When the termination is posted:
* The lease is closed.
* Fixed Asset disposal entries are created.
* Remaining lease liability and asset balances are cleared.
* Any difference between the asset carrying amount and the remaining lease liability is recognized as a gain or loss.
* Schedule Status is changed to **Early Buy-Out** or **Terminated**, depending on the selected termination type.
