This chapter covers the following topics:
You can establish some types of agreements prior to creating contracts.
If you choose to establish terms and conditions that apply to all contracts you enter into with a specific customer, you may create a master lease agreement.
As a lessor, you may enter into multiple leases or loans with the same customer. While these leases could have different start dates, involve different asset types, or have different lengths, they may share a number of terms and conditions or articles. In this case, creating a master lease agreement with the customer allows you to share certain agreed upon terms and conditions across lease contracts.
In other words, a master lease agreement allows you to set some terms and conditions at the customer level. You may also have multiple master lease agreements with the same customer. This is necessary if you have two or more standard lease contract options with the customer.
Within Oracle Leasing and Finance Management, you must access an existing agreement or create a new one before you can access the Terms and Conditions and Articles links. These tasks require an agreement.
Note: If you intend to attach articles to a contract you must set up a master lease agreement. Articles are associated only with a master lease agreement and cannot be added directly to a contract during authoring.
The main topics in this section are:
Create Agreement
Add Terms and Conditions
Add Articles
Activate the Agreement
Initially, you must create an agreement with a customer and then add the appropriate terms and conditions and articles.
You can also edit existing agreements by first searching through existing agreements. Filters include Agreement Number, Customer Name, and Description. Choose the existing agreement you want to edit by clicking the desired hypertext agreement number from the results section.
Customers must be set up in Oracle Receivables.
Perform the following steps in the Master Lease Agreement page:
To create a new agreement, click Create.
The Create Master Lease Agreement page appears.
Select the operating unit.
Note: The list of values includes operating units assigned to the MO: Security profile.
Note: The application displays the selected operating unit as the default in the subsequent pages irrespective of the value that you set for the MO: Default Operating Unit profile option.
The selected operating unit restricts the valid list of values in applicable fields.
Select a legal entity to identify the first party on the agreement.
Enter a unique alphanumeric agreement number.
In the customer name field, click the flashlight icon and choose from the list of values the customer that you want to create a master lease agreement with.
Choose the Source from which you which to create the agreement.
The options are: New, Template, and Copy.
If you choose New, you are creating a brand new agreement.
If you choose Template or Copy, you must click the flashlight icon and select the Template or existing agreement that you want to use as a source from the list of values.
Click Apply to save and add details later. Otherwise, click Save and Add Details.
The Master Lease Agreement details page appears. If you chose New, this page is blank. If you choose either Template or Copy, the page is populated with some or all of the values that appear on the source you are using.
Click Update to add details in the Update Master Lease Agreement page.
Optionally, you can enter a description of the agreement.
In the Contracts region, enter the date the contract is (or was to be) signed.
Enter the credit line number.
Enter the Effective From and Effective To dates.
Enter the primary currency.
The primary currency defined for your business unit is the primary currency for the master lease agreement. This is the default currency for all lease contracts linked to the master lease agreement.
In the Other region, if you want to save this agreement as a template, then select the Save as Template check box.
Click Apply to create the agreement with general details.
If you select the Save as Template check box, you can use the details of this contract for any subsequent contract you enter into with this customer. The contract header details and terms and conditions default onto the new contract if you choose Template as your Source. You can subsequently change any of these details to meet the specifications of the new deal. At the least, you need to change the dates for the term of the contract if they differ from those that appear on the template.
After you have created a master lease agreement with a customer, you can add certain terms and conditions to that agreement. These terms and conditions are applicable on all contracts to which you attach this master lease agreement.
You must create an agreement with a customer.
After your agreement is confirmed, perform the following steps in the Terms and Conditions tab of the Master Lease Agreements details page:
Note: All Terms and Conditions fields are optional entries.
Under the Termination Purchase Options section, if applicable, choose the Mid Term Option from the list of values.
Enter the Mid Term Amount, if applicable, for the selected option.
Choose the End of Term Option from the list of values, if applicable.
Enter the End of Term Amount, if applicable, for the selected option.
Click Apply to save and add other terms. Repeat this step after each term.
Under the Renewal Options section, enter a numeric value for the Renewal notice days field.
This is the number of days required by the customer to be notified of automatic renewals.
Choose a Renewal option from the list of values, if applicable.
Enter the Renewal amount if applicable for the selected option.
Under the Tax section, if you want the contracts linked to the agreement to be Subject to Basic Tax Withholding, select the check box.
Alternatively, in the Calculation Formula Name field, click the flashlight icon and choose the appropriate calculation formula, if applicable.
Under the Insurance section, select the Coverage by Blanket Insurance check box if the lessee has blanket insurance coverage for all referenced contracts.
Select the check box if the customer is insurable for all referenced contracts.
Select the check box if the customer is allowed to cancel insurance on any referenced contract.
In Oracle Leasing and Finance Management, you can add articles to a master lease agreement that become part of any contract that uses the referenced master lease agreement.
A contract article is the text that describes and details the terms and conditions that are attached to a contract. These articles are referenced from a library of articles, which are pre-configured in the Oracle Contracts Core module. You cannot change the text of standard articles, but you can create custom articles and attach them to the master lease agreement.
You cannot add articles directly into a contract in Oracle Leasing and Finance Management. If you want to attach articles to contracts, you must set up at least one master lease agreement.
If you have the appropriate responsibility, you can add or delete articles from existing master lease agreements. At the Agreement Articles page, all articles that are attached to the agreement appear in a table at the bottom of the page.
Articles must be set up in Oracle Contracts Core.
You must have an agreement number selected before you can navigate to the Articles tab on the Master Lease Agreement details page.
Perform the following steps in the Articles page of the Master Lease Agreements subtab:
Click the Articles tab to add existing or create new articles.
A table listing the names and subjects of all the available articles appears at the bottom of the Articles page. You can enter criteria to narrow your search.
Select the check box to the left of each article you want to add to the agreement.
To add articles not displayed on the page, navigate to the next set of articles by clicking the Next 15 hypertext link.
Repeat this process with each article you are attaching to the agreement.
To create new articles, click Create
Add the details in the Create Articles page and click apply.
The two filters for searching for articles are: Name and Subject.
Once you have created a master lease agreement, whether you use a template or not, the contract will have a status of New. To change the status to Active, use the following procedure.
Agreements must be set up.
Perform the following steps in the Master Lease Agreement page:
Search for the agreement you want to activate.
You can filter the search using agreement number, description, customer name, or status
In the results table, click the Activate icon of the agreement you want to activate.
You receive a confirmation message and the agreement status changes from New to Active.