ASC 842 / IFRS 16 / GASB 87 Contracts Functional Overview

To associate an expense type with an ASC 842, IFRS 16, or GASB 87 schedule type:

1. Navigate to Contract > Payment Info > Recurring Expenses.

   Use the links in the Navigation Pane on the leftmost side of the page.

2. Click to the immediate right of the Expense Type in the Expense Setup table.

   A window opens with a list of expense types.

3. Find the expense type you want to include in your schedule.

   You can search for a particular expense type by using the Search in the upper-right corner of the window.

4. Click Edit in the Actions column of the record.

   The Edit Expense Type Code page of the window opens.

5. Choose at least one option:

   • Select a schedule type from the ASC 842 Schedule field.

   • (IFRS firms only) Select a schedule type from the IFRS 16 Schedule field.

   • (GASB firms only) Select a schedule type from the GASB 87 Schedule field.

     If you want to create a new schedule type, follow the Add an Accounting Schedule Type procedures.

6. Click Update.

   The Expense Type window closes. The expense type is updated.

You have the ability to pay expense schedules in arrears. This means that your payments will be considered paid at the end of the month. Therefore, interest expense in a schedule will accrue first before the payment is applied. One very distinct outcome of this is that a schedule that is paid at the beginning of the month should not have an interest expense in its last month.

To enable the Pay in Arrears functionality:

1. Navigate to Contract > Payment Info > Recurring Expenses.

   Use the links in the Navigation Pane on the leftmost side of the page.

2. Scroll down to the Expense Schedule / Escalations section of the page.

3. Select the Pay in Arrears? check box.

4. Click Save Changes.

   This displays in the Actions menu on the right side of the page.

   The page refreshes. Your changes are saved. A message appears: Successfully updated Expense Setup.

To mark a renewal option term as likely:

1. Navigate to Contract > Abstract Info > Terms.

   Use the links in the Navigation Pane on the leftmost side of the page.

2. Do one of the following:

   • To select an existing term and mark it as likely:

     1. Select the term you want to mark as likely from the Contract Terms List section of the page.

     2. Select Likely from the Status field.

     3. Click Save Changes.

        This displays in the Actions menu on the right side of the page.

        The page refreshes. The contract term is updated.

   • To create a new likely term:

     1. Click Add Item.

        This displays in the Actions menu on the right side of the page.

     2. Enter the term number in the Term Number field.

     3. Select Renewal from the Type field.

     4. Select Likely from the Status field.

     5. Verify that the Rentable Area and Area Unit values are correct.

        Important!

        Do not enter 0 in the Rentable Area field. If you are not going to use rentable area, leave the field blank.

     6. Select the Include in Accruals check box if you want to include this renewal option in your accrued expense savings.

     7. Select the key date group from the Group field.

     8. Select the type of key date (for example, Option) from the Type field.

     9. Enter a description of the action necessary on this key date in the Description field.

     10. Enter the begin date in the Begin Date field.

         You can also click Calendar to open the Date Picker and select the appropriate date.

     11. Enter the end date in the End Date field.

         You can also click Calendar to open the Date Picker and select the appropriate date.

         Note:

         The Action fields and the Notice check boxes will be used when you decide to take action on an option, and when notice has been sent or received.

     12. Enter the number of days, weeks, months, or years you have to submit notice after the notice period begins in the Last Notice Period fields.

         A notice is a warning that the key date is imminent. The system will automatically calculate the value in the Last Notice Date using this formula:

         Last Notice Date = Coverage Period Begin Date - Last Notice Period - 1

         Important!

         Add notice periods to the renewal term, NOT the original term.

     13. Enter the earliest date you can give notice in the Earliest Notice Date field.

         You can also click Calendar to open the Date Picker and select the appropriate date.

     14. Enter the length of the tickler period using the Tickler Period fields.

         A Tickler is a friendly reminder that the key date is coming due.

         The system will automatically calculate the value in the Tickler Last Notice Date using this formula:

         Tickler Last Notice Date = Notice End Date - Tickler Period

         However, the Tickler Last Notice Date will not automatically update after being initially calculated unless you click Save.

     15. Enter the tickler date in the Tickler Date field.

         You can also click Calendar to open the Date Picker and select the appropriate date.

     16. Enter any comments in the Comments field.

     17. To associate the renewal option with a covenant, select the covenant from the Covenant field.

         You can view information about a covenant by selecting a covenant from the field and then clicking the View .

     18. Enter the covenant section in the Section field.

     19. Select the covenant amendment from the Amendment field.

         You can view information about an amendment by selecting an amendment from the field and then clicking the View .

     20. Click Save Changes.

         This displays in the Actions menu on the right side of the page.

         The page refreshes. Your changes are saved.

Several fields are automatically populated by the system based upon the data you have entered for your contract. These procedures will only call out fields where you will need to enter data.

To configure your accounting assumptions for ASC 842:

1. Navigate to Contract > Accounting Info > Accounting Assumptions.

   Use the links in the Navigation Pane on the leftmost side of the page.

2. Click Add Item.

   This displays in the Actions menu on the right side of the page.

   A new Accounting Assumptions record is created.

3. Enter the discount rate in the Discount Rate field.

   The Discount Rate is also known as the Interest Rate or Internal Borrower Rate (IBR). To learn how to select a different discount rate from the Manage Discount Rates table, see our Search for Another Discount Rate article.

4. Select the ASC 842 schedule type for which you want to enter assumptions from the ASC 842 Schedule field.

5. (optional - IFRS firms only) If you want to create a linked IFRS 16 accounting assumptions record, select the IFRS 16 schedule type from the IFRS 16 Schedule field.

   Some data will be shared between the two accounting assumptions records, but there are fields that are particular to each lease accounting method. Review the fields on both accounting assumptions pages to ensure that all the relevant data is entered.

6. (optional - GASB firms only) If you want to create a linked GASB 87 accounting assumptions record, select the GASB 87 schedule type from the GASB 87 Schedule field.

   Some data will be shared between the two accounting assumptions records, but there are fields that are particular to each lease accounting method. Review the fields on both accounting assumptions pages to ensure that all the relevant data is entered.

7. Enter the Accounting Begin Date and the Accounting End Date in their respective fields.

   You can also click Calendar to open the Date Picker and select the appropriate date.

   Important!

   The codification requires that you include all reasonably assured options in your accounting schedule. Therefore, we recommend that your Accounting End Date occur after the Likely Term Expiration Date. The Likely Term Expiration Date populates with the expiration date of the latest-occurring reasonably assured option set to “likely”.

   Note:

   The default value for the Accounting Begin Date for ASC 842 Schedules is the later of the ASC 842 Adoption Date or the Possession Begin Date. However, you can override the value of the Accounting Begin Date on the Accounting Assumptions page of your contract or equipment contract.

8. If you want to override the accounting method determined by the ASC 842 Test, select your preferred accounting method from the Accounting Method field.

   If you select an accounting method from this field, the discount rate selected by Lucernex for your schedules may change. To learn more about the logic of how discount rates are selected in Lucernex, see our Lease Accounting Rules and Logic topic.

   If you select a value from this field, run the ASC 842 test, and the ASC 842 Test result is different from the value of the Accounting Method override field, the system will not save the ASC 842 Test. This is because the value of the override field takes precedence over the value of the ASC 842 Test result.

9. To add an accounting adjustment:

   Note:

   The Accounting Assumption Adjustment section allows you to make adjustments to underlying recurring charges. For example, in real estate you might have a gross lease where base rent, base real estate taxes, base operating expenses, and base insurance are all included in one payment. In this scenario, you could create an adjustment to remove any item you do not want to include on the balance sheet.

   1. Click Add Accounting Assumption Adjustment in the Accounting Assumption Adjustments table.

      The Add Accounting Assumption Adjustment window opens.

   2. Select the accounting schedule type from the ASC 842 Schedule, IFRS 16 Schedule, or GASB 87 Schedule field.

      See the Add New Schedule Type procedures to learn how to create a new accounting schedule type.

   3. To associate this adjustment with an expense setup record:

      1. Click Search next to the Expense Setup label.

         The Select Expense Setup Record window opens.

      2. Select the check box next to the expense setup record to which you want to associate this adjustment.

      3. Click Select in the bottom-right corner of the window.

         The window closes. The Expense Setup Record and its associated data populate in the Add Accounting Assumption Adjustment window.

   4. If the expense setup has a secondary schedule allocation, enter the allocation in the Secondary Schedule Allocation field.

      Learn more about Secondary Schedule Allocations.

   5. Enter the begin date of your accounting assumption adjustment in the Begin Date field.

      You can also click Calendar to open the Date Picker and select the appropriate date.

   6. Enter the end date of your accounting assumption adjustment in the End Date field.

      You can also click Calendar to open the Date Picker and select the appropriate date.

   7. Select a proration method from the Proration Method field.

      The proration method you choose tells the system how much a “day” is worth, when your cost period does not encompass the entirety of the period.

   8. Do one of the following:

      • To calculate the payment using the Payment Amount and Frequency fields:

        1. Enter the payment amount into the Payment Amount field.

        2. Select the frequency of the payment from the Frequency field.

           Note:

           The First Payment Amount, Last Payment Amount, and Annual Amount fields will auto-populate depending upon the value you enter in the Payment Amount and the frequency you select from the Frequency field.

      • To calculate the payment using the Rentable Area and Payment Rate fields:

        1. Ensure that the Rentable Area value populates.

           If not, you will need to enter the rentable area at the contract-level.

        2. Enter the payment rate in the Payment Rate field.

           The payment rate is a dollar value: for example, $1.00 per square foot.

   9. Enter any notes in the Notes field.

   10. Click Add.

       The adjustment appears in the Accounting Assumption Adjustments table.

10. Complete these fields:

    Important!

    If any of these values should be deducted, enter them as a negative value.

    • PV Of Structuring Costs: Enter fees paid to the owners of a special-purpose entity for structuring the transaction.

    • PV Of Other Adjustments: Enter other miscellaneous costs that should be accounted for in the schedule.

      Note:

      At this point, the Initial Liability Balance has been determined. We now move forward to determining the Initial Asset Balance.

    • Payments Before Commencement (Less Incentives): Enter the amount paid towards rent prior to the commencement date, minus any incentives that have reduced the cost of the lease.

      The Payments Before Commencement (Less Incentives) is our recommended location for entering your cumulative deferred balance under your straight-line rent.

      Your Purchase Option, Cancellation Option, and Residual Value Guarantee will automatically populate with the data you entered into your abstract. If there are values that are not automatically populating into your assumptions, ensure that they fall within the Accounting Begin Date and Accounting End Date that you selected.

    • Initial Direct Costs: Enter the incremental costs of a lease that would not have been incurred if the lease had not been obtained. For example, broker’s fees, certain legal fees, and certain payments to tenants to move out.

    • Lease Incentives: Enter any incentives that have reduced the cost of the lease.

    • Impairments: Enter any deductions related to the diminished value of the asset.

      Important!

      Impairments should be entered as a negative value.

11. To add an exchange rate to your accounting assumptions:

    1. Click Add Exchange Rate in the bottom-right of the Contract Specific Rates table.

       The Add Exchange Rate window opens.

    2. Select the currency codes from the From Currency and To Currency fields.

    3. Enter the Effective Date of the currency exchange rate.

       You can also click Calendar to open the Date Picker and select the appropriate date.

    4. Enter the exchange rate in the Exchange Rate field.

    5. Click Add.

       The window closes. The exchange rate appears in the Contract Specific Rates table.

       This table is used when a lease utilizes multiple currencies. Any costs entered for a contract in a currency other than your default currency for the contract will be converted using the values entered in this table. This enables reporting and the calculation of the net present value.

12. Click Save Changes.

    This displays in the Actions menu on the right side of the page.

    The page refreshes. A message appears below the Accounting Details tab: Successfully updated Contract.

13. Verify that your data is correct.

    Important!

    If you linked an IFRS 16 schedule type to this accounting assumptions record, follow the Enter Your Accounting Assumptions for IFRS 16 procedures before locking your accounting assumptions record. Once the record is locked, it cannot be edited.

    If you linked a GASB 87 schedule type to this accounting assumptions record, follow the Enter Your Accounting Assumptions for GASB 87 procedures before locking your accounting assumptions record. Once the record is locked, it cannot be edited.

14. Once you have verified that your accounting assumptions have been entered correctly and completely, select the Locked?check box to the right of the Accounting End Date field.

15. Click Save Changes.

    This displays in the Actions menu on the right side of the page.

    The page refreshes. A message appears below the Accounting Details tab: Successfully updated Contract. Your accounting assumptions record is locked.

Several fields are automatically populated by the system based upon the data you have entered for your contract. These procedures will only call out fields where you will need to enter data.

To configure your accounting assumptions for IFRS 16:

1. Navigate to Contract > Accounting Info > Accounting Assumptions.

   Use the links in the Navigation Pane on the leftmost side of the page.

2. Select the IFRS 16 Accounting Assumptions page from the field to the left of the Actions menu on the right side of the page.

3. Click Add Item.

   This displays in the Actions menu on the right side of the page.

   A new Accounting Assumptions record is created.

4. Enter the discount rate in the Discount Rate field.

   The Discount Rate is also known as the Interest Rate or Internal Borrower Rate (IBR). To learn how to select a different discount rate from the Manage Discount Rates table, see our Search for Another Discount Rate article.

5. If you want to create a linked ASC 842 accounting assumptions record, select the ASC 842 schedule type from the ASC 842 Schedule field.

   Some data will be shared between the two accounting assumptions records, but there are fields that are particular to each lease accounting method. Review the fields on both accounting assumptions pages to ensure that all the relevant data is entered.

6. Select the IFRS 16 schedule type for which you want to enter assumptions from the IFRS 16 Schedule field.

7. Enter the Accounting Begin Date and the Accounting End Date.

   You can also click Calendar to open the Date Picker and select the appropriate date.

   Important!

   The codification requires that you include all reasonably assured options in your accounting schedule. Therefore, we recommend that your Accounting End Date occur after the Likely Term Expiration Date. The Likely Term Expiration Date populates with the expiration date of the latest-occurring reasonably assured option set to “likely”.

   Note:

   The default value for the Accounting Begin Date for IFRS 16 or GASB 87 schedules is the later of the IFRS 16 or GASB 87 Adoption Date or the Possession Begin Date. You can override the value of the Accounting Begin Date on the Accounting Assumptions page of your contract or equipment contract.

8. To add an accounting adjustment:

   Note:

   The Accounting Assumption Adjustment section allows you to make adjustments to underlying recurring charges. For example, in real estate you might have a gross lease where base rent, base real estate taxes, base operating expenses, and base insurance are all included in one payment. In this scenario, you could create an adjustment to remove any item you do not want to include on the balance sheet.

   1. Click Add Accounting Assumption Adjustment in the Accounting Assumption Adjustments table.

      The Add Accounting Assumption Adjustment window opens.

   2. Select the accounting schedule type from the ASC 842 Schedule or the IFRS 16 Schedule field.

      See the Add a New Schedule Type procedures to learn how to create a new accounting schedule type.

   3. To associate this adjustment with an Expense Setup Record:

      1. Click Search next to the Expense Setup label.

         The Select Expense Setup Record window opens.

      2. Select the check box next to the expense setup record to which you want to associate this adjustment.

      3. Click Select in the bottom-right corner of the window.

         The window closes. The Expense Setup Record and its associated data populate in the Add Accounting Assumption Adjustment window.

   4. If the expense setup has a secondary schedule allocation, enter the allocation in the Secondary Schedule Allocation field.

      Learn more about Secondary Schedule Allocations.

   5. Enter the begin date of the accounting assumption adjustment in the Begin Date field.

      You can also click Calendar to open the Date Picker and select the appropriate date.

   6. Enter the end date of the accounting assumption adjustment in the End Date field.

      You can also click Calendar to open the Date Picker and select the appropriate date.

   7. Select a proration method from the Proration Method field.

      The proration method you choose tells the system how much a “day” is worth, when your cost period does not encompass the entirety of the period.

   8. Do one of the following:

      • To calculate the payment using the Payment Amount and Frequency fields:

        1. Enter the payment amount into the Payment Amount field.

        2. Select the frequency of the payment from the Frequency field.

           The First Payment Amount, Last Payment Amount, and Annual Amount fields will auto-populate depending upon the value you enter in the Payment Amount and the frequency you select from the Frequency field.

      • To calculate the payment using the Rentable Area and Payment Rate fields:

        1. Ensure that the Rentable Area value populates. If not, you will need to enter the rentable area at the contract-level.

        2. Enter the payment rate in the Payment Rate field.

           The payment rate is a dollar value: for example, $1.00 per square foot.

   9. Enter any notes in the Notes field.

   10. Click Add.

       The adjustment appears in the Accounting Assumption Adjustments table.

9. Complete these fields:

   • PV Of Lease Incentives: Enter incentives that have reduced the cost of the lease.

   • PV Of Other Adjustments: Enter other miscellaneous costs that should be accounted for in the schedule.

   • Payments Before Commencement (Less Incentives): Enter the amount paid towards rent prior to the commencement date, minus any incentives that have reduced the cost of the lease.

     The Payments Before Commencement (Less Incentives) is our recommended location for inputting your cumulative deferred balance under your straight-line rent, and using it as an adjustment between the initial liability balance and the initial asset balance upon transition.

   • Initial Direct Costs: Enter the incremental costs of a lease that would not have been incurred if the lease had not been obtained. For example, broker’s fees, certain legal fees, and certain payments to tenants to move out.

   • Dismantling / Restoring Costs: Enter the cost of any activity necessary to restore the asset to its original state prior to the expiration of the lease.

   • Impairments: Enter any deductions related to the diminished value of the asset.

     Important!

     Impairments should be entered as a negative value.

10. To add an exchange rate to your accounting assumptions:

    1. Click Add Exchange Rate in the bottom-right of the Contract Specific Rates table.

       The Add Exchange Rate window opens.

    2. Select the currency codes from the From Currency and To Currency fields.

    3. Enter the Effective Date of the currency exchange rate.

       You can also click Calendar to open the Date Picker and select the appropriate date.

    4. Enter the exchange rate in the Exchange Rate field.

    5. Click Add.

       The window closes. The exchange rate appears in the Contract Specific Rates table.

       This table is used when a lease utilizes multiple currencies. Any costs entered for a contract in a currency other than your default currency for the contract will be converted using the values entered in this table. This enables reporting and the calculation of the net present value.

11. Click Save Changes.

    This displays in the Actions menu on the right side of the page.

    The page refreshes. A message appears below the Accounting Details tab: Successfully updated Contract.

12. Verify that your data is correct.

    Important!

    If you linked an ASC 842 schedule type to this accounting assumptions record in step 5, follow the Enter Your Accounting Assumptions for ASC 842 procedures before locking your accounting assumptions record. Once the record is locked, it cannot be edited.

13. Once you have verified that your accounting assumptions have been entered correctly and completely, select the Locked? check box to the right of the Accounting End Date field.

14. Click Save Changes.

    This displays in the Actions menu on the right side of the page.

    The page refreshes. A message appears below the Accounting Details tab: Successfully updated Contract. Your accounting assumptions record is locked.

Several fields are automatically populated by the system based upon the data you have entered for your contract. These procedures will only call out fields where you will need to enter data.

To configure your accounting assumptions for GASB 87:

1. Navigate to Contract > Accounting Info > Accounting Assumptions.

   Use the links in the Navigation Pane on the leftmost side of the page.

2. Select the GASB 87 Accounting Assumptions page from the field to the left of the Actions menu on the right side of the page.

3. Click Add Item.

   This displays in the Actions menu on the right side of the page.

   A new Accounting Assumptions record is created.

4. Enter the discount rate in the Discount Rate field.

   The Discount Rate is also known as the Interest Rate or Internal Borrower Rate (IBR). To learn how to select a different discount rate from the Manage Discount Rates table, see our Search for Another Discount Rate article.

5. If you want to create a linked ASC 842 accounting assumptions record, select the ASC 842 schedule type from the ASC 842 Schedule field.

   Some data will be shared between the two accounting assumptions records, but there are fields that are particular to each lease accounting method. Review the fields on both accounting assumptions pages to ensure that all the relevant data is entered.

6. Select the GASB 87 schedule type for which you want to enter assumptions from the GASB 87 Schedule field.

7. Enter the Accounting Begin Date and the Accounting End Date.

   You can also click Calendar to open the Date Picker and select the appropriate date.

   Important!

   The codification requires that you include all reasonably assured options in your accounting schedule. Therefore, we recommend that your Accounting End Date occur after the Likely Term Expiration Date. The Likely Term Expiration Date populates with the expiration date of the latest-occurring reasonably assured option set to “likely”.

   Note:

   The default value for the Accounting Begin Date for IFRS 16 or GASB 87 schedules is the later of the IFRS 16 or GASB 87 Adoption Date or the Possession Begin Date. You can override the value of the Accounting Begin Date on the Accounting Assumptions page of your contract or equipment contract.

8. To add an accounting adjustment:

   Note:

   The Accounting Assumption Adjustment section allows you to make adjustments to underlying recurring charges. For example, in real estate you might have a gross lease where base rent, base real estate taxes, base operating expenses, and base insurance are all included in one payment. In this scenario, you could create an adjustment to remove any item you do not want to include on the balance sheet.

   1. Click Add Accounting Assumption Adjustment in the Accounting Assumption Adjustments table.

      The Add Accounting Assumption Adjustment window opens.

   2. Select the accounting schedule type from the ASC 842 Schedule or the GASB 87 Schedule field.

      See the Add a New Schedule Type procedures to learn how to create a new accounting schedule type.

   3. To associate this adjustment with an Expense Setup Record:

      1. Click Search next to the Expense Setup label.

         The Select Expense Setup Record window opens.

      2. Select the check box next to the expense setup record to which you want to associate this adjustment.

      3. Click Select in the bottom-right corner of the window.

         The window closes. The Expense Setup Record and its associated data populate in the Add Accounting Assumption Adjustment window.

   4. If the expense setup has a secondary schedule allocation, enter the allocation in the Secondary Schedule Allocation field.

      Learn more about Secondary Schedule Allocations.

   5. Enter the begin date of the accounting assumption adjustment in the Begin Date field.

      You can also click Calendar to open the Date Picker and select the appropriate date.

   6. Enter the end date of the accounting assumption adjustment in the End Date field.

      You can also click Calendar to open the Date Picker and select the appropriate date.

   7. Select a proration method from the Proration Method field.

      The proration method you choose tells the system how much a “day” is worth, when your cost period does not encompass the entirety of the period.

   8. Do one of the following:

      • To calculate the payment using the Payment Amount and Frequency fields:

        1. Enter the payment amount into the Payment Amount field.

        2. Select the frequency of the payment from the Frequency field.

           The First Payment Amount, Last Payment Amount, and Annual Amount fields will auto-populate depending upon the value you enter in the Payment Amount and the frequency you select from the Frequency field.

      • To calculate the payment using the Rentable Area and Payment Rate fields:

        1. Ensure that the Rentable Area value populates. If not, you will need to enter the rentable area at the contract-level.

        2. Enter the payment rate in the Payment Rate field.

           The payment rate is a dollar value: for example, $1.00 per square foot.

   9. Enter any notes in the Notes field.

   10. Click Add.

       The adjustment appears in the Accounting Assumption Adjustments table.

9. Complete these fields:

   • PV Of Lease Incentives: Enter any incentives that have reduced the cost of the lease.

   • PV Of Other Adjustments: Enter any other miscellaneous costs that should be accounted for in the schedule.

   • Payments Before Commencement (Less Incentives): Enter the amount paid towards rent prior to the commencement date, minus any incentives that have reduced the cost of the lease.

     The Payments Before Commencement (Less Incentives) is our recommended location for inputting your cumulative deferred balance under your straight-line rent, and using it as an adjustment between the initial liability balance and the initial asset balance upon transition.

   • Initial Direct Costs: Enter the incremental costs of a lease that would not have been incurred if the lease had not been obtained. For example, broker’s fees, certain legal fees, and certain payments to tenants to move out.

   • Dismantling / Restoring Costs: Enter the cost of any activity necessary to restore the asset to its original state prior to the expiration of the lease.

   • Impairments: Enter any deductions related to the diminished value of the asset.

     Important!

     Impairments should be entered as a negative value.

10. To add an exchange rate to your accounting assumptions:

    1. Click Add Exchange Rate in the bottom-right of the Contract Specific Rates table.

       The Add Exchange Rate window opens.

    2. Select the currency codes from the From Currency and To Currency fields.

    3. Enter the Effective Date of the currency exchange rate.

       You can also click Calendar to open the Date Picker and select the appropriate date.

    4. Enter the exchange rate in the Exchange Rate field.

    5. Click Add.

       The window closes. The exchange rate appears in the Contract Specific Rates table.

       This table is used when a lease utilizes multiple currencies. Any costs entered for a contract in a currency other than your default currency for the contract will be converted using the values entered in this table. This enables reporting and the calculation of the net present value.

11. Click Save Changes.

    This displays in the Actions menu on the right side of the page.

    The page refreshes. A message appears below the Accounting Details tab: Successfully updated Contract.

12. Verify that your data is correct.

    Important!

    If you linked an ASC 842 schedule type to this accounting assumptions record in step 5, follow the Enter Your Accounting Assumptions for ASC 842 procedures before locking your accounting assumptions record. Once the record is locked, it cannot be edited.

13. Once you have verified that your accounting assumptions have been entered correctly and completely, select the Locked? check box to the right of the Accounting End Date field.

14. Click Save Changes.

    This displays in the Actions menu on the right side of the page.

    The page refreshes. A message appears below the Accounting Details tab: Successfully updated Contract. Your accounting assumptions record is locked.

If you selected a value from the Accounting Method override field on the ASC 842 Accounting Assumptions page, run the ASC 842 test, and the ASC 842 Test result is different from the value of the Accounting Method override field, the system will not save the ASC 842 Test. This is because the value of the override field takes precedence over the value of the ASC 842 Test result.

To run an ASC 842 lease classification test:

1. Navigate to Contract > Accounting Info > ASC 842 Test.

   Use the links in the Navigation Pane on the leftmost side of the page.

2. Click Add Item.

   This displays in the Actions menu on the right side of the page.

3. Select the asset type from the Asset Type field.

4. Select the schedule type from the Schedule field.

   Important!

   Do not select the Locked? check box until you have completed the classification test. Selecting this check box will prevent you from editing the classification test.

5. Enter notes in the Notes field.

6. Test 1: Select the check box if the ownership of the asset reverts to the tenant at the end of the lease term.

7. Test 2: Select the check box if the lease contains a purchase option that the tenant is likely to exercise.

8. Test 3: Complete the following fields:

   • Remaining Economic Life Threshold: The fraction of the economic life of the underlying asset that amounts to “a major part” of that remaining economic life. This value is usually set to 75%.

   • Year Useful Life Began or Year Built

   • Commercial Property, Standard Depreciable Life, 39. 5 years: Enter the value of the remaining economic life using the fields provided.

   • Test Begin Date / Test End Date

     Note:

     This test compares the Remaining Economic Life of the lease to the Test Begin and End Dates. If this value is below the Remaining Economic Life Threshold, your lease will pass this test.

   • Is the lease commencement at or near the end of the economic life of the asset?: If selected, Test 3’s outcome changes to Pass regardless of whether the value the Test Term Length to Remaining Life is greater than the Remaining Economic Life Threshold field.

9. Test 4: Complete the following fields:

   • Fair Value Threshold: The fraction of the fair value of the underlying asset that amounts to “substantially all” of its fair value. This value is usually set to 90%.

   • Discount Rate: The discount rate should automatically populate. The Discount Rate is also known as the Interest Rate or Internal Borrower Rate (IBR).

     To learn how to select a different discount rate from the Manage Discount Rates table, see our Search for Another Discount Rate article.

   • PV Of Structuring Costs: Enter fees paid to the owners of a special-purpose entity for structuring the transaction.

   • PV Of Other Adjustments: Enter other miscellaneous costs that should be accounted for in the schedule.

   • Portion of Asset Controlled: Enter the percentage based upon the rentable area divided by the total area of the asset.

   • Fair Value of Asset: FASB 842. 10. 20 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

   • Fair Value Source: Enter the name of the person who assessed the fair value of the asset. You can also attach a document by clicking the Attach Document .

   This test determines whether you are paying more for the asset than the percentage of the asset you control, or whether the initial liability balance is less than or greater than the threshold fair value controlled.

10. Test 5: Select the check box if the asset has a specialized use, such as that the lessor will have no alternative use for it.

11. Click Run and Save.

    This displays in the Actions menu on the right side of the page.

    The page refreshes, and the results of the test appear in the ASC 842 Test List table at the top of the page. The test results also appear in the ASC 842 Test table above the Locked? check box.

12. Review your rest results. If your results are not what you expected, review the data you entered.

13. If you want to re-run the ASC 842 Test:

    1. Make your changes.

    2. Click Run and Save.

       This displays in the Actions menu on the right side of the page.

14. Once you are certain the results are correct, select the Locked? check box in the upper-right corner of the ASC 842 Test table.

    Important!

    Locking the test ensures that the test cannot be modified. You cannot delete a classification test once it has been locked, but you can create another test as necessary.

15. Click Run and Save to confirm that you want to lock the classification test.

    This displays in the Actions menu on the right side of the page.

16. If at any point you need to run a new classification test, click Add Item.

    This displays in the Actions menu on the right side of the page.

    A new classification test opens.

To generate an ASC 842 accounting schedule:

1. Navigate to one of the two following pages:

   • Contract > Accounting Info > Accounting Assumptions

   • Contract > Accounting Info > ASC 842 Rent Schedule

   Use the links in the Navigation Pane on the leftmost side of the page.

2. Click Calculate Schedule.

   This displays in the Actions menu on the right side of the page.

   The Create New ASC 842 Rent Schedule window opens. The Begin Date, End Date, Accounting Method, and Discount Rate automatically populate. Many of the fields in this window will automatically populate with data entered on the ASC 842 Contract Accounting Assumptions page. This is the last place where you can edit these fields prior to generating your schedule.

   To learn how to select a different discount rate from the Manage Discount Rates table, see our Search for Another Discount Rate article.

   Note:

   The default value of the Schedule Begin Date is the later of the Accounting Begin Date or the first day of the first unposted period for the schedule. You can override the value of the Schedule Begin Date in the Create Schedule window, provided the date you choose is on or after the first day of the first unposted period.

3. Select the schedule type from the Type field.

4. Select the accounting method from the Accounting Method field.

   If you select Finance, two new fields appear: Remaining Asset Balance and Date to Amortize to. These fields will also appear if you select Operating and then enter a value in the Impairments field.

5. Select the reason for creating the schedule from the Creation Reason field.

   Creation reasons are either user-generated or generated at the company level. However, all creation reasons created at the user level will also be available at the company level.

6. If you want to specify a percentage or amount of the total asset balance that should remain after the schedule end date, enter the value in the Remaining Asset Balance field.

   There are two option buttons: Currency and Percentage. If you enter a value between 0-100, the system will default the option setting to Percentage. If you enter a value of 100.01 or above, the system will default the option setting to Currency. You can override the default option setting.

7. If you want to select a date beyond the schedule end date to amortize to, enter the date in the Date to Amortize to field.

   By default, the value of this field is the schedule end date.

   To learn more about asset amortization, see the Amortization of the Asset in Contracts article.

8. Enter any other miscellaneous costs that should be accounted for in the schedule in the PV Of Other Adjustments field.

9. Enter any fees paid to the owners of a special-purpose entity for structuring the transaction in the PV Of Structuring Costs field.

10. Enter the amount paid towards rent prior to the commencement date, minus any incentives that have reduced the cost of the lease in the Payments Before Commencement (Less Incentives) field.

11. Enter the incremental costs of a lease that would not have been incurred if the lease had not been obtained in the Initial Direct Costs field. For example, broker’s fees, certain legal fees, and certain payments to tenants to move out.

12. Enter any incentives that have reduced the cost of the lease in the Lease Incentive Amount field.

13. Enter any deductions related to the diminished value of the asset in the Impairments field.

    Important!

    Impairments should be entered as a negative value.

    The Remaining Asset Balance and Date to Amortize to fields appear if you selected Operating from the Accounting Method field. See steps 6 and 7 to learn how to complete these fields.

    If you enter a value in the Impairments field, two read-only fields appear:

    • Prior Accumulated Amortization Balance: Accumulated Amortization Balance of the accounting period prior to the impairment.

    • Total: Sum of the impairment and the Prior Accumulated Amortization Balance.

14. Click Create Schedule.

    The page refreshes, and the schedule appears on the page.

To generate an IFRS 16 accounting schedule:

1. Navigate to one of the two following pages.

   • Contract > Accounting Info > Accounting Assumptions > IFRS 16 Accounting Assumptions page

   • Contract > Accounting Info > IFRS 16 Rent Schedule

     Use the links in the Navigation Pane on the leftmost side of the page.

2. Click Calculate Schedule in the Actions menu on the right side of the page.

   The Create New IFRS 16 Rent Schedule window opens. The Begin Date, End Date, and Discount Rate automatically populate. Many of the fields will automatically populate with data entered on the IFRS 16 Contract Accounting Assumptions page. This is the last place where you can edit these fields prior to generating your schedule.

   To learn how to select a different discount rate from the Manage Discount Rates table, see our Search for Another Discount Rate article.

   Note:

   The default value of the Schedule Begin Date is the later of the Accounting Begin Date or the first day of the first unposted period for the schedule. You can override the value of the Schedule Begin Date in the Create Schedule window, provided the date you choose is on or after the first day of the first unposted period.

3. Select the schedule type from the Type field.

4. Select the reason for creating the schedule from the Creation Reason field.

   Creation reasons are either user-generated or generated at the company level. However, all creation reasons created at the user level will also be available at the company level.

5. If you want to specify a percentage or amount of the total asset balance that should remain after the schedule end date, enter the value in the Remaining Asset Balance field.

   There are two option buttons: Currency and Percentage. If you enter a value between 0-100, the system will default the option setting to Percentage. If you enter a value of 100.01 or above, the system will default the option setting to Currency. You can override the default option setting.

6. If you want to select a date beyond the schedule end date to amortize to, enter the date in the Date to Amortize to field.

   By default, the value of this field is the schedule end date.

   To learn more about asset amortization, see the Amortization of the Asset in Contracts article.

7. Enter any incentives that have reduced the cost of the lease in the Lease Incentive Amount field.

8. Enter any other miscellaneous costs that should be accounted for in the schedule in the PV Of Other Adjustments field.

9. Enter the amount paid towards rent prior to the commencement date, minus any incentives that have reduced the cost of the lease, in the Payments Before Commencement (Less Incentives) field.

10. Enter the incremental costs of a lease that would not have been incurred if the lease had not been obtained in the Initial Direct Costs field.

    For example, broker’s fees, certain legal fees, and certain payments to tenants to move out.

11. Enter the cost of any activity necessary to restore the asset to its original state prior to the expiration of the lease in the Dismantling / Restoring Costs field.

12. Enter any deductions related to the diminished value of the asset in the Impairments field.

    Important!

    Impairments should be entered as a negative value.

    If you enter a value in the Impairments field, two read-only fields appear:

    • Prior Accumulated Amortization Balance: Accumulated Amortization Balance of the accounting period prior to the impairment.

    • Total: Sum of the impairment and the Prior Accumulated Amortization Balance.

13. Click Create Schedule.

    The page refreshes, and the schedule appears on the page.

To generate a GASB 87 accounting schedule:

1. Navigate to one of the two following pages.

   • Contract > Accounting Info > Accounting Assumptions > GASB 87 Accounting Assumptions page

   • Contract > Accounting Info > GASB 87 Rent Schedule

     Use the links in the Navigation Pane on the leftmost side of the page.

2. Click Calculate Schedule in the Actions menu on the right side of the page.

   The Create New GASB 87 Rent Schedule window opens. The Begin Date, End Date, and Discount Rate automatically populate. Many of the fields will automatically populate with data entered on the GASB 87 Contract Accounting Assumptions page. This is the last place where you can edit these fields prior to generating your schedule.

   To learn how to select a different discount rate from the Manage Discount Rates table, see our Search for Another Discount Rate article.

   Note:

   The default value of the Schedule Begin Date is the later of the Accounting Begin Date or the first day of the first unposted period for the schedule. You can override the value of the Schedule Begin Date in the Create Schedule window, provided the date you choose is on or after the first day of the first unposted period.

3. Select the schedule type from the Type field.

4. Select the reason for creating the schedule from the Creation Reason field.

   Creation reasons are either user-generated or generated at the company level. However, all creation reasons created at the user level will also be available at the company level.

5. If you want to specify a percentage or amount of the total asset balance that should remain after the schedule end date, enter the value in the Remaining Asset Balance field.

   There are two option buttons: Currency and Percentage. If you enter a value between 0-100, the system will default the option setting to Percentage. If you enter a value of 100.01 or above, the system will default the option setting to Currency. You can override the default option setting.

6. If you want to select a date beyond the schedule end date to amortize to, enter the date in the Date to Amortize to field.

   By default, the value of this field is the schedule end date.

   To learn more about asset amortization, see the Amortization of the Asset in Contracts article.

7. Enter any incentives that have reduced the cost of the lease in the Lease Incentive Amount field.

8. Enter any other miscellaneous costs that should be accounted for in the schedule in the PV Of Other Adjustments field.

9. Enter the amount paid towards rent prior to the commencement date, minus any incentives that have reduced the cost of the lease, in the Payments Before Commencement (Less Incentives) field.

10. Enter the incremental costs of a lease that would not have been incurred if the lease had not been obtained in the Initial Direct Costs field.

    For example, broker’s fees, certain legal fees, and certain payments to tenants to move out.

11. Enter the cost of any activity necessary to restore the asset to its original state prior to the expiration of the lease in the Dismantling / Restoring Costs field.

12. Enter any deductions related to the diminished value of the asset in the Impairments field.

    Important!

    Impairments should be entered as a negative value.

    If you enter a value in the Impairments field, two read-only fields appear:

    • Prior Accumulated Amortization Balance: Accumulated Amortization Balance of the accounting period prior to the impairment.

    • Total: Sum of the impairment and the Prior Accumulated Amortization Balance.

13. Click Create Schedule.

    The page refreshes, and the schedule appears on the page.

To generate a straight line schedule:

1. Navigate to Contract > Accounting Info > Straight-Line Rent.

   Use the links in the Navigation Pane on the leftmost side of the page.

2. Click Calculate Schedule.

   This displays in the Actions menu on the right side of the page.

   The Create New Straight-line Schedule window opens.

3. Enter the Begin Date and End Date of the accounting schedule.

   You can also click Calendar to open the Date Picker and select the appropriate date.

4. Select the schedule type from the Type field.

5. Select the reason for creating the schedule from the Creation Reason field.

   Creation reasons are either user-generated or generated at the company level. However, all creation reasons created at the user level will also be available at the company level.

6. Click Create Schedule.

   The page refreshes, and the schedule appears on the page.

When an active schedule is recalculated or terminated, the Inactive Date of the previously active schedule will automatically populate with the date of recalculation or termination.

To re-measure a lease accounting schedule:

1. Do one of the following:

   • Navigate to Contract > Accounting Info > Accounting Assumptions

   • Navigate to Contract > Accounting Info > ASC 842 Rent Schedule

     Use the links in the Navigation Pane on the leftmost side of the page.

2. Click Calculate Schedule.

   This displays in the Actions menu on the right side of the page.

   A window relevant to the schedule you are re-measuring opens.

3. Enter the dates that your re-measurement should begin and end in the Begin Date and End Date fields.

   You can also click Calendar to open the Date Picker and select the appropriate date.

   Note:

   The default value of the Schedule Begin Date is the later of the Accounting Begin Date or the first day of the first unposted period for the schedule. You can override the value of the Schedule Begin Date in the Create Schedule window, provided the date you choose is on or after the first day of the first unposted period.

4. Select the schedule type from the Type field.

5. Select the creation reason from the Creation Reason field.

6. Select the lease type from the Lease Type field.

   Creation reasons are either user-generated or generated at the company level. However, all creation reasons created at the user level will also be available at the company level.

   The data from the existing schedule populates. If there are any posted periods between the Accounting Begin Date and the Accounting End Date, the Re-measurement Balance Forward will automatically calculate the re-measurement balance forward for those posted periods.

7. Make any changes necessary to the discount rate, the liability values, and the right of use asset values prior to re-measurement.

   To learn how to select a different discount rate from the Manage Discount Rates table, see our Search for Another Discount Rate article.

8. Click Create Schedule.

   The window closes, and the ASC 842 Rent Schedule page refreshes. The re-measured schedule appears in your ASC 842 Rent Schedule List.

When an active schedule is recalculated or terminated, the Inactive Date of the previously active schedule will automatically populate with the date of recalculation or termination.

To re-measure a lease accounting schedule:

1. Do one of the following:

   • Navigate to Contract > Accounting Info > Accounting Assumptions , then select IFRS 16 Accounting Assumptions from the field to the left side of the Actions menu on the right side of the page.

   • Navigate to Contract > Accounting Info > IFRS 16 Rent Schedule.

     Use the links in the Navigation Pane on the leftmost side of the page.

2. Click Calculate Schedule.

   This displays in the Actions menu on the right side of the page.

   A window relevant to the schedule you are re-measuring opens.

3. Enter the dates that your re-measurement should begin and end in the Begin Date and End Date fields.

   You can also click Calendar to open the Date Picker and select the appropriate date.

   Note:

   The default value of the Schedule Begin Date is the later of the Accounting Begin Date or the first day of the first unposted period for the schedule. You can override the value of the Schedule Begin Date in the Create Schedule window, provided the date you choose is on or after the first day of the first unposted period.

4. Select the schedule type from the Type field.

5. Select the creation reason from the Creation Reason field.

   Creation reasons are either user-generated or generated at the company level. However, all creation reasons created at the user level will also be available at the company level.

6. Select the lease type from the Lease Type field.

   The data from the existing schedule populates. If there are any posted periods between the Begin Date and the End Date, the Re-measurement Balance Forward will automatically calculate the re-measurement balance forward for those posted periods.

7. Make any changes necessary to the discount rate, the liability values, and the right of use asset values prior to re-measurement.

   To learn how to select a different discount rate from the Manage Discount Rates table, see our Search for Another Discount Rate article.

8. Click Create Schedule.

   The window closes, and the page refreshes. The re-measured schedule appears in your IFRS 16 Rent Schedule List on the IFRS 16 Rent Schedule page.

When an active schedule is recalculated or terminated, the Inactive Date of the previously active schedule will automatically populate with the date of recalculation or termination.

To re-measure a lease accounting schedule:

1. Do one of the following:

   • Navigate to Contract > Accounting Info > Accounting Assumptions , then select GASB 87 Accounting Assumptions from the field to the left side of the Actions menu on the right side of the page.

   • Navigate to Contract > Accounting Info > GASB 87 Rent Schedule.

     Use the links in the Navigation Pane on the leftmost side of the page.

2. Click Calculate Schedule.

   This displays in the Actions menu on the right side of the page.

   A window relevant to the schedule you are re-measuring opens.

3. Enter the dates that your re-measurement should begin and end in the Begin Date and End Date fields.

   You can also click Calendar to open the Date Picker and select the appropriate date.

   Note:

   The default value of the Schedule Begin Date is the later of the Accounting Begin Date or the first day of the first unposted period for the schedule. You can override the value of the Schedule Begin Date in the Create Schedule window, provided the date you choose is on or after the first day of the first unposted period.

4. Select the schedule type from the Type field.

5. Select the creation reason from the Creation Reason field.

   Creation reasons are either user-generated or generated at the company level. However, all creation reasons created at the user level will also be available at the company level.

6. Select the lease type from the Lease Type field.

   The data from the existing schedule populates. If there are any posted periods between the Begin Date and the End Date, the Re-measurement Balance Forward will automatically calculate the re-measurement balance forward for those posted periods.

7. Make any changes necessary to the discount rate, the liability values, and the right of use asset values prior to re-measurement.

   To learn how to select a different discount rate from the Manage Discount Rates table, see our Search for Another Discount Rate article.

8. Click Create Schedule.

   The window closes, and the page refreshes. The re-measured schedule appears in your GASB 87 Rent Schedule List on the GASB 87 Rent Schedule page.

The FASB / IASB Re-Measurement Report template will produce an excel file that can be imported to regenerate schedules that are out of date in bulk. This report template fetches FASB / IASB schedules that have the Recalc? flag set to Yes. This feature will be of high value for clients with a high volume of leases to manage.

To learn how to use the FASB / IASB Re-Measurement Report template, please see the Re-Measure Your Lease Accounting Schedules Using the FASB / IASB Re-Measurement Report procedures.

Proration is disabled in the first period of a re-measured Straight Line schedule, because doing so changes the total obligation.

To re-measure a lease accounting schedule:

1. Navigate to Contract > Accounting Info > Straight-Line Rent.

   Use the links in the Navigation Pane on the leftmost side of the page.

2. Click Calculate Schedule.

   This displays in the Actions menu on the right side of the page.

   A window relevant to the schedule you are re-measuring opens.

3. Enter the Begin Date and End Date of the accounting schedule.

   You can also click Calendar to open the Date Picker and select the appropriate date.

4. Select the schedule type from the Type field.

5. If you have a balance forward that you need to account for:

   1. Enter the balance forward in the Balance Forward field.

   2. Select whether you want to amortize your adjustments over the remaining term or as a lump sum from the Amortize Adjustments field.

6. Select the reason for creating the schedule from the Creation Reason field.

   Creation reasons are either user-generated or generated at the company level. However, all creation reasons created at the user level will also be available at the company level.

7. Enter notes in the Notes field.

8. Click Create Schedule.

   The window closes, and the page refreshes. Your new schedule appears in the Straight-Line Summary List.

To perform a partial lease termination:

1. Navigate to one of fifteen pages:

   • Contract > Accounting Info > ASC 842 Test

   • Contract > Accounting Info > ASC 842 Rent Schedule

   • Contract > Accounting Info > IFRS 16 Rent Schedule

   • Contract > Accounting Info > GASB 87 Rent Schedule

   • Contract > Accounting Info > Accounting Assumptions

   • Contract > Accounting Info >Accounting Assumptions > IFRS 16 Accounting Assumptions

   • Contract > Accounting Info >Accounting Assumptions > GASB 87 Accounting Assumptions

   • Equipment Contract > Accounting Info > ASC 842 Test

   • Equipment Contract > Accounting Info > ASC 842 Test > Equipment Assumptions / ASC 842 Tests

   • Equipment Contract > Accounting Info > ASC 842 Rent Schedule

   • Equipment Contract > Accounting Info > IFRS 16 Rent Schedule

   • Equipment Contract > Accounting Info > GASB 87 Rent Schedule

   • Equipment Contract > Accounting Info > Accounting Assumptions

   • Equipment Contract > Accounting Info > Accounting Assumptions > IFRS 16 Accounting Assumptions

   • Equipment Contract > Accounting Info > Accounting Assumptions > GASB 87 Accounting Assumptions

2. Click Calculate Schedule in the Actions menu on the right side of the page.

   A Create New Schedule window opens.

   The Start Date of your new schedule is the day after your last posted period.

3. If there is a change in value in the underlying asset, enter either a percentage value in the P&L Impact percentage field or a negative fixed dollar amount in the P&L Impact fixed dollar amount field.

   If there is no change in the underlying asset, you do not need to allocate any of the Remeasurement Balance Forward to P&L Impact.

   Important!

   The P&L Amount requires a negative value because it is a percentage of the Remeasurement Balance Forward field, which is also negative.

   This amount will be held back from your new schedule and posted to a field (SLSummary.ProfitAndLossImpact) which can be fed to an ERP integration as a GL entry. The system will automatically calculate the appropriate fixed amount or percentage; depending upon which field you enter a value.

   Note:

   You can allocate 100% of your remeasurement balance forward to your profit and loss impact without terminating your lease accounting schedule. This functionality supports the use case where you might want to impair the asset or write off the existing balance forward.

4. Make any other changes to your schedule data as necessary.

5. Click Create Schedule.

   The window closes. The new schedule appears in the Rent Schedule List.

To perform a full lease termination:

1. Navigate to one of fifteen pages:

   • Contract > Accounting Info > ASC 842 Test

   • Contract > Accounting Info > ASC 842 Rent Schedule

   • Contract > Accounting Info > IFRS 16 Rent Schedule

   • Contract > Accounting Info > GASB 87 Rent Schedule

   • Contract > Accounting Info > Accounting Assumptions

   • Contract > Accounting Info >Accounting Assumptions > IFRS 16 Accounting Assumptions

   • Contract > Accounting Info >Accounting Assumptions > GASB 87 Accounting Assumptions

   • Equipment Contract > Accounting Info > ASC 842 Test

   • Equipment Contract > Accounting Info > ASC 842 Test > Equipment Assumptions / ASC 842 Tests

   • Equipment Contract > Accounting Info > ASC 842 Rent Schedule

   • Equipment Contract > Accounting Info > IFRS 16 Rent Schedule

   • Equipment Contract > Accounting Info > GASB 87 Rent Schedule

   • Equipment Contract > Accounting Info > Accounting Assumptions

   • Equipment Contract > Accounting Info > Accounting Assumptions > IFRS 16 Accounting Assumptions

   • Equipment Contract > Accounting Info > Accounting Assumptions > GASB 87 Accounting Assumptions

2. Click Calculate Schedule in the Actions menu on the right side of the page.

   A Create New Schedule window opens.

3. Select the Terminate Schedule tab.

   Your Begin and End Date, Schedule Type, and P&L Impact value should pre-populate on the page. In this case, the entire amount of the Remeasurement Balance Forward will populate the P&L Impact field, and it will be uneditable.

4. Select the appropriate creation reason from the Creation Reason field.

5. Enter any notes in the Notes field.

6. Click Create Schedule.

   A dialog opens, asking you to confirm your choice.

7. Click Yes.

   A new schedule appears in the Rent Schedule List, where all values are listed as $0.00. This is a single-period schedule that is created to close out the prior accounting schedule, so that ERP integrations can close the balance sheet for this schedule.

The above procedures describe only how to close out the accounting schedules for a terminated lease. If the lease is being fully terminated you will still need to update your Payment End Date at the lease level so that no new rent payments will be generated.

To update your payment end dates:

1. Do one of the following:

   • Navigate to Contract > Details > Summary using the tabs at the top of the page.

   • Navigate to Equipment Contract > Details > Summary using the tabs at the top of the page.

2. Click Edit link in the Actions menu on the right side of the page.

   The page becomes editable.

3. Scroll down to the Critical Dates section of the page.

4. Change the Payments End Date to the end date of your schedule.

5. Click Save Changes.

   This displays in the Actions menu on the right side of the page.

   The page refreshes. Your changes are saved.