This chapter covers the following topics:
When a contract is booked, Oracle Lease and Finance Management calls the accounting engine to create balance sheet entries for the assets on a lease. Depending on the book classification, the lease contract is an asset in the form of expected receivables or leased assets. Each period some of the assets are amortized as they generate revenue and incur expense. These entries are reported through a company's income statements.
When the receivable or asset values change, the balance sheet accounts must be updated. Depending on when the changes occurred, the revenues and expenses recognized may also require adjustments. All adjustments must happen in the same accounting period or the balance sheet will be incorrect. The process of making these adjustments is called rebooking.
If financial information does not change, you can make small revisions to a contract without rebooking the contract. After you have booked a contract, however, you cannot change the financial terms of the contract without making a contract revision and going through the Rebook process.
Rebooking is the process of altering an existing lease/loan transaction due to some financial change in the deal structure, rental payment change, credit extension, due date change, etc. New accounting entries or adjusting entries are made when the contract is reactivated.
Oracle Lease and Finance Management supports the following two types of rebooking:
Online Rebook - Users edit a copy of the contract and the changes are copied back to a version of the original contract.
Mass Rebook - Edits are directly copied onto the contract version.
If you make adjustments to a contract that effect such factors as depreciation, rent, overall cost, or residual value, you must perform the complete, two-part Revision and Rebook process. Non-financial contract revisions, such as billing set ups, do not require rebooking. Asset splits and contract reversal do not involve stream generation and do not require rebooking.
Revisions that require changes to journal entries require the complete Rebook process.
Note: When you revise a contract using the online rebook method, you cannot change the contract currency, and some other types of information. In addition, although it may appear that you can edit all fields, not all edits are copied back into the rebooked contract version. Mass rebooks are done through controlled processes that require specific inputs for changed values.
Rebooking is required for any change impacting the following:
cash flow dates - impacts rates and interest charges
rents - impacts income amount and rates
asset values - impacts income amount and rates
depreciation values - impacts expenses which impacts net income
book classification - supported through re-lease, not rebook
stream regeneration - any need to regenerate streams
The first part of contract revisions is to initiate a revision from the Revisions pages.
You must have a booked contract. Some types of contract revisions have further prerequisites, for example:
To Reverse a contract (a different process from revising), you must not yet have billed or accrued it. See Reverse a Booked Contract. If it has already been billed, you must terminate the contract instead. See Contract Terminations. You may reverse a contract that has been funded.
Perform the following steps for contract revisions in the Revise Contract page.
Search for booked contracts in the Contract Search page.
In the search results table, select Revise in the Action column for the applicable booked contract and click Go.
The Revise Contract page opens.
Select one of the following reason types:
Rebook- Initiates an online rebook revision where you can edit some of the data on the contract.
Reverse a Contract-Reverses the contract booking transaction if there are no transactions against the contract except Funding and Booking.
Under Revision-Allows you to view the online rebook copies for the contract.
Split Asset-Allows you to split an asset which does not require a rebook.
Associate Services-Used to delink lease and service contracts for revising.
Release Contract-Allows you to perform a customer change or product change on a contract.
Select a Reason, and the date you want the revision to take effect, from the lists of values. Possible reasons include: Adjust Cost, Adjust Depreciation, Adjust Rent, or Adjust Residual Value; Change in Due Date or Start Date; Customer Change, Extend Term; Principal Paydown, Product Change, Split Asset; and Other. The Properties, Yields, and Streams details of the contract appear as read-only fields.
Additional Information: The Customer Change reason code is used by the Transfer and Assumption process, which allows you to change customer-related information on the contract, such as Customer Name, Bill-To Address, etc. For more information, see Transfer and Assumption below.
Select or enter the Revision Date. (It must be after the Rebook Limit date of the original contract.)
Additional Information: The Revision Date is used as the in-service date for new asset lines added during rebook. It is also used as the transaction date for any rebook-related adjustments and is the effective date of any contract transfer for customer change or product change.
While revising a contract with a late interest date, ensure that the contract revision date is earlier than the late interest date.
Oracle Lease and Finance Management allows returned equipment to be re-leased on a new contract. Operational flexibility often requires lessors to add a re-lease asset over the life of the contract. Some scenarios that require the addition of a re-lease asset over the life of the contract are:
Additional units delivered and added to a contract during the contract term
Units terminated from a contract for a period of time but later added back to the same contract
Units terminated from one contract and added back to another contract
Additionally, Oracle Lease and Finance Management provide the ability to calculate and collect upfront tax on re-lease assets.
On the Configuration page for the rebook contract, select the Re-Lease option from the Create Asset list.
Navigate to the Create Re-lease Asset page and allow the entry of asset details. While saving the asset details, validate that off lease transaction processing is complete for the re-lease asset.
You should be able to enter asset terms, subsidies, and payments and perform fee/service/usage association for the newly added re-lease asset.
The system performs applicable QA validations and generates streams for the added re-lease asset.
Activate the rebook contract for the added re-lease asset. When activating the rebook contract, the system performs the following updates:
Synchronizes the contract line, re-lease asset identifier, terms, payments, subsidies, fee/service/usage association and streams on to original contract.
Performs Release accounting for the re-lease assets added during rebook.
Performs updates in Oracle Assets to link the re-lease asset to the contract and update the asset cost and depreciation parameters as required.
Updates the Installed Base instance to reflect the new contract customer and install location.
If the re-lease asset was associated to a usage line, updates the service contract to reflect the addition.
Updates the asset return request status to Cancelled, if any.
Enable the system option “Enable Upfront Tax on Re-lease”. This option is enabled only if the “Tax Upfront” system option was enabled. If the system option “Enable Upfront Tax on Re-lease” is disabled, then no upfront tax call will be made for re-lease assets. By default, the value of the system option “Enable Upfront Tax on Re-lease” is set to No.
If the system option “Enable Upfront Tax on Re-lease” is enabled, the system performs the following:
Execute the Calculate Upfront Tax step during the contract activation for all contracts, including contracts having re-lease assets (such as renewal and refinance). An exception would be Transfer & Assumption and Product Change release contracts.
Makes the upfront tax call for re-lease assets during Booking, Rebook, Asset Relocation, Split into units and Split into components transactions.
For upfront tax calculated on re-lease assets, creates a billing transaction or capitalized/financed fee depending on the Upfront Tax Treatment specified on the contract.
Online rebook is the process of manually rebooking a contract. During online rebooking, when you click Rebook, a copy of the contract is created with the contract number containing the rebook extension. The original contract remains active and in effect during the editing of the copy. Once you activate the contract copy, fields that can be edited, along with streams and yields, are copied from the rebooked contract copy to a new version of the original contract. The contract copy is assigned the status Abandoned and is no longer usable. Copies can be abandoned if rebooking is not to be completed. When you book the copy contract, the original contract is versioned.
The following table shows what online rebooking changes are permitted in Oracle Lease and Finance Management.
| Allowed | Not Allowed |
|---|---|
| Term extension | Customer or customer account |
| Term reduction | New services or service changes |
| Add parties | New usages or changes to usages |
| Changes to payments (asset, fee, service) | Changes to covered assets |
| Changes to assets from the start date, including depreciation changes | Changes to fees (except for General fees) |
| New assets (ending at the same time as the contract term end) | |
| New fees | |
| Non-financial changes, such as terms and conditions, or asset details |
When booking a new version of a contract, the rebooking transaction date is used to determine the General Ledger date. Contracts can be rebooked for closed periods. For transaction dates in closed periods, Oracle Lease and Finance Management finds the open period closest to the transaction date and posts entries for that period.
Changing start dates during a rebook is permitted in the following situations:
The new start date must occur after the original start date. Back-dating to a previous date is not allowed.
The new start date must occur before the revision date.
The revision date cannot be before the rebook limit date.
You can enter a date that is in the future in relationship to the original start date, but not earlier than the original start date.
The rebook limit date cannot be updated after booking, and does not change as a result of the rebook.
You can now reduce the term of a contract while rebooking.
The following validations are included for term reduction:
Term reduction is only allowed for contract in Booked status.
The term reduction is not allowed if the new end date is earlier than the system date, that is the revised contract end date must be in the future.
No accepted termination or renewal quotes should be present on the contract.
For Investor Agreements, the term reduction is allowed if the contract is securitized and brought back.
The term reduction is not allowed if the usage line is present on the contract.
The term reduction is not allowed if following transactions are present after new contract end date:
Rebook , Release, Termination, Principal Paydown, or Split Asset Transactions
Asset relocation
FA transactions
Insurance
T & A
Variable Rate interest calculation
Passthrough, Expense, and Funding disbursements
Additional Validations:
You may need to perform the following additional validations in other areas as well if the term is reduced during rebook:
Transfer and Assumption:
On approving the T&A request, you must check that the Transfer Effective Date is still within the contract term.
You must check whether the current lessee is valid in the new term.
Insurance:
You must relax the validation on the insurance effectivity while rebooking a contract.
You must make sure that the insurance policy gets created for the new term and adjustments, if any, should happen accordingly.
Post Rebook using Term Reduction Check:
You may need to check the following activities while reducing the term of the contract:
Billing Reversal:
If the billing has already been done between the new contract end date and old contract end date, then you must reverse the billed invoices.
Accrual Adjustments:
If the accrual is already run beyond the new contract end date, then you must do the accrual adjustment.
During an online rebook, the Residual Value can be updated using the Contracts Revision page. The user can writedown the Residual Value by a percentage or a fixed amount. The rebook process will update the contract with the new Residual Value.
Residual Value can also be updated using the Residual Value Writedown page under the Assets - Transactions Tab. The user can writedown the Residual Value by a percentage or a fixed amount. To process the Residual Value transaction, the Process Residual Value Writedown transactions program should be run. The Process Residual Value Writedown transactions program calls Mass Rebook which updates the contract with the new Residual Value.
An online rebook or mass rebook does not update the Salvage Value on the contract.
When a rebook is activated, the insurance policy program cancels the existing policy and creates a new policy based on the new contract values. No other programs are required.
In a scenario where you have a contract with a 24 month term and a corresponding insurance policy for 24 months, and you rebook the contract for a 36 month term, the new insurance policy will also include the new 36 month term. Oracle Lease and Finance Management will refund any unused premiums and bill for new premiums.
During a full termination, the rebook process cancels insurance policies. No new policy is created. When a policy is canceled, Oracle Lease and Finance Management processes the accrual, billing, and disbursement adjustments.
The insurance policy is calculated at the assets level to determine a single premium amount for all assets on a contract. The policy details are stored on a contract line that references the contract header. When the policy is canceled during a rebook, the amount paid by the lessee is compared to the number of months of past coverage. Credit is calculated for the remaining number of months that were paid but not used. A credit memo is created for that amount.
After the rebook is complete, a new policy is created using the revised value for the assets to determine a new premium. The premium is calculated on a quote (as for a new contract) at the asset level and then summed to a total for the quote. A policy is then created and activated from the quote automatically. The premium amount is billed on an invoice. You can then apply the credit memo for the cancelled policy to that invoice.
Online rebook calculates and generates adjustment entries for already billed and accrued streams on the rebooking date. The adjustment is based on the following information:
The last stream element date until which the billing process is run.
The last stream element date until which the accrual process is run.
These dates identify the total amount actually billed or accrued versus the total amount that should have been billed or accrued. This process is run for each billed stream type prior to rebooking. The difference between these two amounts is used to calculate adjustments.
Rebook online using the Revise Contracts page. The following steps outline the online rebooking process:
Search for booked contracts in the Contract Search page.
In the search results table, select Revise in the Action column for the applicable booked contract and click Go.
The Revise Contract page opens.
Select Rebook Contract as the revision type.
Select the revision reason and the date the changes become effective.
Click Go and receive confirmation.
The Contract Details page opens.
Click Update and edit.
The following tables shows fields that can be updated for online rebooking and whether the update is supported from the Lease Center.
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Contract Description | Yes |
| Master Lease Number | No |
| Sales Representative | No |
| Purchase Order Number | Yes |
| Acceptance Method | Yes |
| Bill To Address | Yes |
| Term | No |
| Expected Delivery Date | No |
| Acceptance Date | Yes |
| Date Signed | No |
| Effective From | No |
| Re-Book Limit Date | No |
| Private Activity Bond | No |
| Consumer Credit Act Deal | No |
| Non-notification | No |
| Investor Assignable | No |
| Policy Number | No |
| Effective From | No |
| Effective To | No |
| Covered Amount | No |
| Deductible | No |
| Endorsement Field | No |
| Name of Insured | No |
| Lessor Insured - Yes/No | No |
| Lessor Payee - Yes/No | No |
| Insurance Company | No |
| Address | No |
| Agent or Broker Name | No |
| Agent or Broker Address | No |
| Insurance Proof - Due Date | No |
| Insurance Proof - Provided Date | No |
| Contract DFF | Yes |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Party Knows As | No |
| Alias | No |
| Additional Information (Party DFF) | Yes |
| Party Knows As | No |
| Alias | No |
| Customer | No |
| Customer Account | No |
| Bill To Address | No |
| Payment Method | No |
| Bank Account | No |
| Invoice Format | No |
| Print Lead Days | No |
| Review Invoice | No |
| Reason for Review | No |
| Review Until Date | No |
| Additional Information (Party DFF) | No |
| Add Third Party Insurance Provider | Yes |
| Update Third Party Insurance Provider - Party Knows As | No |
| Update Third Party Insurance Provider - Alias | No |
| Additional Information (Party DFF) | Yes |
| Add Guarantor | Yes |
| Update Guarantor - Name | Yes |
| Update Guarantor - Guarantor Type | Yes |
| Update Guarantor - Correspondence Site | Yes |
| Update Guarantor - Guarantee Type | Yes |
| Update Guarantor - Guaranteed Amount | Yes |
| Update Guarantor - Guarantee Date | Yes |
| Update Guarantor - Comments | Yes |
| Update Guarantor - Additional Information (Party DFF) | Yes |
| Add Label Holder | Yes |
| Update Label Holder - Name | No |
| Update Label Holder - URL | No |
| Update Label Holder - Additional Information (Party DFF) | Yes |
| Remove Label Holder | No |
| Add User-Defined Party Role | Yes |
| Update User-Defined Party Role - Party Knows As | No |
| Update User-Defined Party Role - Alias | No |
| Update User-Defined Party Role - Additional Information (Party DFF) | Yes |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Lien Type | No |
| Filing Number | No |
| Filing Date | No |
| Status | No |
| Lien Holder | No |
| Jurisdiction | No |
| Sub-Jurisdiction | No |
| Expiration Date | No |
| Continuation Number | No |
| Continuation Date | No |
| Title Type | No |
| Title Issuer | No |
| Title Date | No |
| Title Number | No |
| Registration Number | No |
| Location | No |
| Title Custodian | No |
| Payee Site | No |
| Registration Location | No |
| Registration Expiration Date | No |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Floor Price Formula | Yes |
| Remarket Sale Price Formula | Yes |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Bill To Address | Yes |
| Payment Method | Yes |
| Bank Account | Yes |
| Bank Name | Yes |
| Cash Application Rule | Yes |
| Invoice Format | Yes |
| Print Lead Days | Yes |
| Review Invoice | Yes |
| Reason for Review | Yes |
| Review until Date | Yes |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Partial Termination Allowed | Yes |
| Approval Required | Yes |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Strategy | No |
| Days from Contract Expiration | No |
| Budget Amount Option | No |
| Budget Fixed Amount | No |
| Budget Amount Formula | No |
| Assignment Group | No |
| Approval Required | No |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Purchase Option Type | No |
| Purchase Option | No |
| Purchase Option Amount | No |
| Purchase Option Formula | No |
| Purchase Option Prorate | No |
| Purchase Option Maximum Option | No |
| Purchase Option Maximum Amount | No |
| Purchase Option Maximum Formula | No |
| Purchase Option Minimum Option | No |
| Purchase Option Minimum Amount | No |
| Purchase Option Minimum Formula | No |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Purchase Option Type | No |
| Purchase Option | No |
| Purchase Option Amount | No |
| Purchase Option Formula | No |
| Purchase Option Prorate | No |
| Purchase Option Maximum Option | No |
| Purchase Option Maximum Amount | No |
| Purchase Option Maximum Formula | No |
| Purchase Option Minimum Option | No |
| Purchase Option Minimum Amount | No |
| Purchase Option Formula | No |
| Automatically Process Fixed Purchase Option | Yes |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Eligible | Yes |
| Evergreen Formula | No |
| Passthrough Stream Type | No |
| Vendor Site | No |
| Pay Group | No |
| Payment Terms | No |
| Payment Basis | No |
| Pay Start Date | No |
| Payment Method | No |
| Payment Frequency | No |
| Remittance Days | No |
| Disbursement Basis | No |
| Disbursement Fixed Amount | No |
| Disbursement Percent | No |
| Processing Fee Basis | No |
| Processing Fee Fixed Amount | No |
| Processing Fee Percent | No |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Date | No |
| Percentage | No |
| Discount Rate | No |
| Updateable Fields - | Update Supported From Lease Center |
|---|---|
| Net Quote Option | Yes |
| Net Quote Amount | Yes |
| Net Quote Formula | Yes |
| Tolerance Allowed Option | Yes |
| Tolerance Allowed Amount | Yes |
| Tolerance Allowed Formula | Yes |
| Tolerance Basis | Yes |
| Approval Processing Formula | Yes |
| Approval Required | Yes |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Held Until | Yes |
| Late Interest Exempt | Yes |
| Late Interest Policy | Yes |
| Held Until | Yes |
| Late Interest Exempt | Yes |
| Late Interest Policy | Yes |
| Bill To Address | Yes |
| Payment Method | Yes |
| Bank Account | Yes |
| Bank Name | Yes |
| Cash Application Rule | Yes |
| Invoice Format | Yes |
| Print Lead Days | Yes |
| Review Invoice | Yes |
| Reason for Review | Yes |
| Review until Date | Yes |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Advance Notice | No |
| Delay Days | No |
| Approver | No |
| Courtesy Copy | No |
| Additional Recipient | No |
| Allocation Percentage | No |
| Main Recipient | No |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Renewal Notice Days | Yes |
| Renewal Option | Yes |
| Renewal Amount | Yes |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Repurchase Agreement | No |
| Repurchase Quote Formula | No |
| Sale Price Option | No |
| Sale Price Amount | No |
| Sale Price Formula | No |
| Sale Price Prorate | No |
| Discount Rate Option | No |
| Discount Rate Amount | No |
| Discount Rate Formula | No |
| Discount Rate Prorate | No |
| Quote Fee Option | No |
| Quote Fee Amount | No |
| Quote Fee Formula | No |
| Quote Fee Prorate | No |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Automatically Calculate Residual Value Insurance | No |
| Residual Value Insurance Rate | No |
| Held Until Maturity | Yes |
| Net From Proceeds | Yes |
| Held Until Date | Yes |
| Update Lines From Contract | No |
| Interest Disclosed | Yes |
| Transfer of Title | Yes |
| Sale and Lease Back | Yes |
| Purchase of Lease | Yes |
| Intended Use for Tax | Yes |
| Age of Equipment | Yes |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Termination Quote Formula | No |
| Contract Obligation Option | No |
| Contract Obligation Amount | No |
| Contract Obligation Formula | No |
| Contract Obligation Prorate | No |
| Discount Rate Option | Yes |
| Discount Rate Amount | Yes |
| Discount Rate Formula | Yes |
| Discount Rate Prorate | No |
| Quote Free Option | Yes |
| Quote Free Amount | Yes |
| Quote Free Formula | Yes |
| Quote Free Prorate | No |
| Return Fee Option | Yes |
| Return Fee Amount | Yes |
| Return Fee Formula | Yes |
| Return Fee Prorate | No |
| Rollover Incentive Option | No |
| Rollover Incentive Amount | No |
| Rollover Incentive Formula | No |
| Rollover Incentive Prorate | No |
| Security Deposit Option | No |
| Security Deposit Amount | No |
| Security Deposit Formula | No |
| Security Deposit Prorate | No |
| Termination Penalty Option | Yes |
| Termination Penalty Amount | Yes |
| Termination Penalty Formula | Yes |
| Termination Penalty Prorate | No |
| Termination Penalty Cap Option | No |
| Termination Penalty Cap Amount | No |
| Termination Penalty Cap Formula | No |
| Absorbed Fee Formula | No |
| Expense Fee Formula | No |
| Financed Fee Formula | No |
| General Fee Formula | No |
| Income Fee Formula | No |
| Miscellaneous Fee Formula | No |
| Passthrough Fee Formula | No |
| Rollover Fee | No |
| Estimated Property Tax Option | No |
| Estimated Property Tax Amount | No |
| Estimated Property Tax Formula | No |
| Estimated Property Tax Prorate | No |
| Contractual Fees Option | No |
| Outstanding Balances Option | No |
| Service and Maintenance Option | No |
| Service and Maintenance Formula | No |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Termination Quote Formula | No |
| Contract Obligation Option | No |
| Contract Obligation Amount | No |
| Contract Obligation Formula | No |
| Contract Obligation Prorate | No |
| Discount Rate Option | Yes |
| Discount Rate Amount | Yes |
| Discount Rate Formula | Yes |
| Discount Rate Prorate | No |
| Quote Free Option | Yes |
| Quote Free Amount | Yes |
| Quote Free Formula | Yes |
| Quote Free Prorate | No |
| Return Fee Option | Yes |
| Return Fee Amount | Yes |
| Return Fee Formula | Yes |
| Return Fee Prorate | No |
| Rollover Incentive Option | No |
| Rollover Incentive Amount | No |
| Rollover Incentive Formula | No |
| Rollover Incentive Prorate | No |
| Security Deposit Option | No |
| Security Deposit Amount | No |
| Security Deposit Formula | No |
| Security Deposit Prorate | No |
| Termination Penalty Option | Yes |
| Termination Penalty Amount | Yes |
| Termination Penalty Formula | Yes |
| Termination Penalty Prorate | No |
| Termination Penalty Cap Option | No |
| Termination Penalty Cap Amount | No |
| Termination Penalty Cap Formula | No |
| Absorbed Fee Formula | No |
| Expense Fee Formula | No |
| Financed Fee Formula | No |
| General Fee Formula | No |
| Income Fee Formula | No |
| Miscellaneous Fee Formula | No |
| Passthrough Fee Formula | No |
| Rollover Fee | No |
| Estimated Property Tax Option | No |
| Estimated Property Tax Amount | No |
| Estimated Property Tax Formula | No |
| Estimated Property Tax Prorate | No |
| Contractual Fees Option | No |
| Outstanding Balances Option | No |
| Service and Maintenance Option | No |
| Service and Maintenance Formula | No |
| Updateable Fields | Update Supported From Lease Center |
|---|---|
| Manual Quotes Only | No |
| Early Termination Allowed | Yes |
| First Termination Date | No |
| Send Bill Of Sale | No |
| Quote Effective Days | Yes |
| Quote Effective Maximum Days | Yes |
| End Of Term Tolerance Days | Yes |
| Updateable Fields | Update Supported From Lease Center |
| Asset - Add Asset | No |
| Add Asset - Item | No |
| Add Asset - Units | No |
| Add Asset - Unit Cost | No |
| Asset Key | No |
| Prescribed Asset | No |
| Model | Yes |
| Manufacturer | Yes |
| Year of Manufacturer | Yes |
| Install Site | Yes |
| Fixed Asset Location | Yes |
| Expected Delivery Date | No |
| Expected Funding Date | No |
| Depreciation Method | No |
| Life in Months | No |
| Rate (%) | No |
| In Service Date | No |
| Depreciable Cost | No |
| Salvage Value Basis | No |
| Salvage Value | No |
| Add AddOn | No |
| Update AddOn | No |
| Item | No |
| Cost | No |
| Manufacturer | No |
| Model Number | No |
| Year of Manufacture | No |
| Notes | No |
| Vendor | No |
| Invoice Number | No |
| Invoice Date | No |
| Ship To Site | No |
| Bill To Address | No |
| Payment Method | No |
| Bank Account | No |
| Effective From | No |
| Evergreen Formula | No |
| Passthrough Stream Type | No |
| Vendors | No |
| Vendor | No |
| Vendor Site | No |
| Pay Group | No |
| Payment Terms | No |
| Payment Basis | No |
| Payment Start Date | No |
| Payment Method | No |
| Payment Frequency | No |
| Remittance Days | No |
| Disbursement Basis | No |
| Disbursement Fixed Amount | No |
| Disbursement Percent | No |
| Processing Fee Basis | No |
| Processing Fee Fixed Amount | No |
| Processing Fee Percent | No |
| Vendor | No |
| Invoice Number | No |
| Invoice Date | No |
| Ship To Site | No |
| Serial Number | Yes |
| Update Lines from Contract | No |
| Transfer of Title | Yes |
| Sale and Lease Back | Yes |
| Purchase of Lease | Yes |
| Intended Use for Tax | Yes |
| Age of Equipment | Yes |
| Lien Type | Yes |
| Filing Number | Yes |
| Filing Date | Yes |
| Status | Yes |
| Lien Holder | Yes |
| Jurisdiction | Yes |
| Sub-Jurisdiction | Yes |
| Expiration Date | Yes |
| Continuation Number | Yes |
| Continuation Date | Yes |
| Title Type | No |
| Title Issuer | No |
| Title Date | No |
| Title Number | No |
| Registration Number | No |
| Location | No |
| Title Custodian | No |
| Payee Site | No |
| Registration Location | No |
| Registration Expiration Date | No |
| Updateable Fields | Update Supported From Lease Center |
| Trade-In Date | No |
| Description | No |
| Amount | No |
| Asset Trade-In Amount | No |
| Basis | No |
| Down Payment Amount (Percent) | No |
| Capitalize | No |
| Down Payment Receiver | No |
| Subsidy | No |
| Subsidy Amount | No |
| Override Amount | No |
| Party | No |
| Pay Site | No |
| Payment Term | No |
| Payment Method | No |
| Pay Group | No |
If a contract is updated in an online rebook and these updates do not have a financial impact, the following are not required:
Stream generation
Yield calculation
Accounting transactions
Such online rebooks are called non-financial rebooks.
To perform a non-financial rebook, you must select a rebook reason that is associated with the lookup OKL_NON_FIN_REBOOK_REASON. You can select this rebook reason in the Revise Contract page. When this rebook reason is selected, the copy of the contract which is created allows update of only those fields that have no direct financial impact.
Upon activation of the rebook, neither stream generation nor accounting transactions occur.
When the financial elements of a contract are modified due to changing conditions that result in revisions agreed to by both customer and lessor, or due to errors while authoring a contract, the resulting changes in income and expense must be spread over the remaining term of a contract. Oracle Lease and Finance Management's accounting processes with Effective Dated Rebook allow you to spread the financial impact of contract revisions from the effective date of change over the remaining term only. Effective Dated Rebook contract changes have no impact on prior accounting periods.
When a contract is rebooked, you can make the proper accounting adjustments, including the ability to spread the financial impact of the contract revisions over the remaining contract term, using Effective Dated Rebook. When utilized, Effective Dated Rebook ensures that income adjustments due to contract revisions are not recalculated and adjusted for periods prior to the effective date of the revision. Accounting for income adjustments is recognized from the effective revision date through the remaining contract term only.
This enables you to automatically apply your accounting policies with no impact on contract changes to prior or current accounting periods. Contract changes for floating rate contracts, principal paydowns, and restructures are prospective.
Effective Dated Rebook applies to standard income and expense streams in both Internal and External Pricing engines.
The Effective Dated Rebook option fulfills the following business needs:
Eliminates income and expense adjustments associated to periods before the effective date of rebook
Accounts for income and expense adjustments in the proper period without manual intervention
For variable rate contracts, ensures that income recognition is consistent with the applicable rate
Effective Dated Rebook is provided in the following revision processes:
Online Rebook
Online Mass Rebook
Principal Paydown
Partial Termination
Residual Value Writedown
Reamortization
To enable Effective Dated Rebook, you must set the Amortize Income Adjustments From Revision Date system option to Yes at the Business Unit level. Once this option is set to Yes, it cannot be changed.
For external pricing engines, upgrade must be performed for existing contracts if the Amortize Income Adjustments from Revision Date system option is set to Yes. When set to Yes, a contract revision can only be performed after the contract is upgraded.
Upgrades are performed by the following methods:
Upgrade concurrent program
Upgrade from the Contract Copy Summary tab when performing an Online Rebook
For external pricing engines, you can upgrade existing contracts by running the Effective Dated Rebook Upgrade concurrent program in a Review or Submit mode. The Review mode enables you to see contracts eligible for upgrade before running the upgrade.
You can select contracts to upgrade based on one of the following criteria sets:
Contract: A wide variety of contract attributes, such as Customer, Book Classification, Effective Date, etc.
Process: Allows the selection of contracts to undergo a revision process at the time, such as Online Rebook, Principal Paydown, etc.
Reversing a contract cancels the accounting entries created by booking and funding, and effectively ends a contract. Reversing a contract is not possible if you have already run billing and accrual, but you can reverse if the contract has been funded. This process does not reverse entries in Oracle Assets
A contract must be Booked before it is reversed. However, it cannot be billed or have any other transactions, except Funding, before it is reversed.
A contract may be Funded before it is reversed. In reversing, Oracle Lease and Finance Management will automatically adjust its funding transactions.
Search for booked contracts in the Contract Search page.
In the search results table, select Revise in the Action column for the applicable booked contract and click Go.
The Revise Contract page opens.
Select Reverse Contract as the revision type.
Select the date the changes become effective and click Go.
Nothing further is required. You do not need to run the Billing programs.
This is a view-only function that allows you to look at various contracts that are currently under revision. On the Revisions page, click Under Revisions. The Revisions in Progress page opens.
Click the copy contract or contract that you want to view.
To cancel a revision, select the check box next to the copy contract number and click Abandon.
If you need to split an asset line into multiple asset lines, you can perform the Split Asset task. Because this activity does not have a financial impact on the contract, the status of the original contract never changes, and no rebook is performed. Split assets can also be created for assets off of a contract.
You can split an asset line either by units or by components. When you split an asset line by units, you can choose to split the asset line either into individual units, or to split the original number of units into two parts. For example, you can split an asset line with 10 units into 10 asset lines, each containing one unit, or you could split the asset line into two asset lines, one with 4 units, the other with 6 units.
When you split an asset line into components, you split an asset by value rather than number of units. In this case, you select new items that are components of the original asset; and for each component item, select a percentage of the total value. The number of units of each new item is the same as the number of units of the original asset. You must register the new items in Oracle Inventory before you can select them.
For example, your original asset line consists of 5 units of a Desktop PC, total cost $6000. The PC consists of two components, PC Base and PC Monitor.
When you split by components, the following conditions apply:
You select two new component items
You allocate new asset numbers and descriptions for the new items
You specify the percentage of the total original asset cost for each component In this example, you can split the PC into two components: New item PC Base, percentage 70 and New item PC Monitor, percentage 30.
You must also provide a new asset number and description for both components. When split into components, the original 5 units of the Desktop PC split into: 5 units of the item PC Base, cost $4200 and 5 units of the item PC Monitor, cost $1800.
Perform the following steps on the Revise Contract page to split assets:
Search for booked contracts in the Contract Search page.
In the search results table, select Revise in the Action column for the applicable booked contract and click Go.
The Revise Contract page opens.
Select the applicable revision type to split assets into components or units.
Enter the Revision Date for the Split. The date must fall within the contract term.
Select the asset to split. The asset's description, number of units, and cost appear.
If you have selected Split Asset into Components as the revision type, then click Go. If you have selected Split Asset into Units, then provide the following details and click Go:
To split the asset into multiple single-unit asset lines, select the Split into Single Units check box. For example, if you had an asset line with 10 units and you select this check box, you would create 10 asset lines, each containing one unit.
To split the asset into two multi-unit asset lines, clear the Split into Single Units check box. In the Number of Units field, enter the number of units you want to split off from the main asset line. For example, if you enter 4, then 4 assets are split into one line and the remaining 6 assets stay attached to the existing asset line.
The Contract Details page opens.
For splitting the asset into units, the Asset Number region displays a new automatically generated asset number line and the original, parent, asset number line. The number of units shown on each line reflects the number you chose. Click Update to edit the new asset description.
Optionally, click Serial Numbers. On the Serial Numbers page, select the individual asset units by serial number for the new asset line, for as many lines as specified by the Number of Units.
For splitting assets into components, the Contact Details page displays a grid, where each line represents a new component. Search for and select a component item. Click Add Rows if you require more components. For each component, enter the required details: Asset Number, Asset Description, Split Percent (percentage of the total cost for the component).
Optionally, click the Serial Number icon. Select the serial numbers for the new asset.
Click Apply.
The Split Asset revision process completes. You do not need to run Billing programs.
You can split evergreen and re-lease assets into units or components only if salvage value is not being depreciated in the evergreen or re-lease term. This is because fixed assets do not allow asset adjustments when salvage value is being depreciated. If depreciation is required in the evergreen term, you must define asset lives greater than the contract base term. If the asset life was set as the contract base term during contract authoring, you should update the asset life to a greater value when the contract converts to evergreen. During splitting, the following transactions take place:
| Finance Lease | Operating Lease | |
|---|---|---|
| New Asset | Evergreen and Re-Lease Assets:
|
Evergreen and Re-Lease Assets:
|
| Old Asset |
|
|
The system automatically calculates a depreciation adjustment to ensure that after the split, the sum of the new and old assets accumulated depreciation matches the accumulated depreciation of the parent asset before the split. The adjustment is processed in Fixed Assets through an Unplanned Depreciation entry. The automatic unplanned depreciation adjustment is calculated and processed only if asset depreciation method is Flat Rate or Straight Line.
When an asset is split into units and components, linked asset streams are generated only for asset lines sourced from the split asset.
Streams are not generated for the following:
Asset lines not being split. This includes subsidy and fee streams associated to the asset lines not being split.
Contract level fees which are not associated to an asset line.
The following procedure describes how to view streams generated for the impacted split asset.
Perform the following steps in the Contracts tab of the Customers page:
Search for the contract having the split asset.
Click the contract number.
Note: You can go to the Configuration tab in the Contract page to view the split assets.
In the Contract page, go to the Summary tab.
In the Activation summary region of the Summary tab, click the details icon corresponding to Activate Contract.
Search for the history streams in the Streams region of the Activate Contract page. To search, you can select the following options:
Status: Select History.
Stream Level: Select Asset.
The history streams for the impacted split asset are displayed.
Note: The non-participating asset in the split asset transaction does not have any history sets associated with it.
Before you revise linked service and lease contracts, you must first delink them.
With the lease contract in context, on the Revise contract page, select Associate a Service as the revision type and click Go. The Associate Service Contract page appears, displaying the lease contract, the associated service contract, and the Supplier/Vendor.
Click Delink.
Delink stops service contract billing in Oracle Lease and Finance Management and reestablishes service contract billing in Oracle Service Contracts through the accounts receivable interface to Oracle Receivables.
Revise the lease contract, if necessary, by following the steps described through Online Rebook.
Revise the service contract, if necessary, in Oracle Service Contracts.
If you do not want to generate consolidated lease and service contract invoices, do not link the revised contracts. Run the Oracle Service Contracts billing process and the Oracle Lease and Finance Management Billing process independently.
If you want to generate consolidated lease and service contract invoices, follow the steps to link service contracts (see Set Up Service Lines). Linking the lease and service contracts automatically disables the interface between Oracle Service Contracts and Oracle Receivables, and consolidates the lease and service contract billing through Oracle Lease and Finance Management.
Run the Oracle Service Contracts billing. Run the Oracle Lease and Finance Management billing processes.
Mass Rebook is the process of rebooking multiple contracts. Mass rebook allows you to search for contracts by combining certain parameters with operands to identify the contracts you want to rebook. You can subsequently change certain aspects of the contract through the same process. The rebooked contracts keep their original contract numbers.
Mass rebooking is also used in partial terminations and variable rate changes. Functionally, the results are identical to those of online rebooking, but in mass rebook no contract copy is created. Also, mass rebook further limits the parameters you can change on a contract and rebook.
The mass rebook process consists of the following two steps:
select contracts to create a batch
rebook all contracts in the batch with the newly-specified values
Parameters you may use to select contracts that you want to mass rebook include:
Contract Number- May be a range
Contract Start Date-May be a range
Tax Book-Must be a specific value, only
Depreciation Method Code-Must be a specific value, only
In Service Date-May be a range
Asset Category-Must be a specific value, only
Life in Months-Must be a specific value, only
Basic Rate-Must be a specific value, only
Adjusted Rate-Must be a specific value, only
You can narrow the search by using operands such as "LIKE," "BETWEEN," "=," and "<>." There are two Criteria Value columns where you can enter criteria for your search, and another column for a specific Set Value. The Set Value will be the new value assigned to each contract in the batch during rebooking. For example, if you want to select a set of contracts that have start dates that fall within the range of a particular month, you can modify the search in the following manner:
| Criteria | Operand | Criteria From | Criteria To | Set Value |
|---|---|---|---|---|
| Contract Start Date | BETWEEN | 01-May-2004 | 30-MAY-2004 | - |
There are four aspects of contracts that you can use the mass rebook functionality to change:
Depreciation Method Code
Life in Months
Basic Rate
Adjusted Rate
You can use the categories Depreciation Method and Date Placed In Service for both selecting which contracts to rebook, and also as entries to change during the mass rebooking.
Mass rebook revisions are typically a two-step process where you first create a batch request by using specified criteria to identify the contracts you want to rebook. Then you run the rebook request for all the contracts your criteria search has identified. You can specify those contracts from the list that you want to include in the mass rebook.
Note: All operands are case sensitive; use UPPERCASE, only.
You must have booked contracts.
Perform the following steps in the Mass Rebook page:
Click Create to create a new mass rebook request.
The Create Mass Rebook page opens where you enter your search criteria and the changes you want to make to the contracts that you are rebooking.
Enter the request number. The number can be any alpha-numeric combination you want. You can subsequently access the request using this number.
Specify the criteria you want to use to group your contracts for mass rebooking.
Click Next to update the contracts.
The Selected Contracts page appears. This page displays all the contracts that your request returned, based on your criteria.
If you want to mass rebook all the contracts, click Next to enter the set values for these criteria.
If you want to exclude some of the contracts, in the Selected Column, select the No value for all contracts you do not want to rebook and click Next.
By default, all contracts carry a Yes value in the Selected column.
Click Apply.
From the Mass Rebook main page, you can search for previous requests by entering the request number.
You cannot edit any requests already submitted, because there may be processing already occurring against the contracts included in the mass rebook request.
Ownership changes and organizational restructuring may result in the need to change the lessee in lease contracts. This process of changing the lessee is known as Transfer and Assumption (T&A).
Changing the lessee may be required for the entire contract or a subset of asset lines. The original lessee is responsible for invoices with dates due before the transfer date. The transferred lessee becomes responsible for invoices due after the transfer date.
T&A requests must occur without affecting the accruals, amortizations and depreciation in the contract. There should be no accounting or pricing impacts beyond billing adjustments.
Oracle Lease and Finance Management enables you to:
Transfer the contract from one lessee to another while preserving the integrity of contract financials.
Change lessees in evergreen leases.
Change borrowers in loan contracts.
Transfer a subset of assets in the contract.
Record T&As effective on past, present or future dates.
Transfer and Assumption Requests Process Flow
The T&A process flow includes:
Creating a Transfer and Assumption Request: You can use the Request tab of Contract Modifications page to search for existing T&As requests or creating T&A requests.
Updating the Transfer and Assumption Request: You can use the General and Additional Details tabs to update the request details. The Configuration tab displays the details of the assets which you have selected for transfer.
Note: Transfer Balance in the Configuration tab is an information-only field which displays the asset balance amount on the T&A effective date. It is calculated based on the user configurable formula LINE_TRANSFER_ BALANCE according to the following contract book classifications:
Operating Lease: Sum of rents due after the T&A effective date.
Direct Finance Lease: Net investment balance
Loans: Principal balance
If a contract is in Evergreen status, the value returned by the formula is zero. You can update T&A requests until they are submitted for approval.
Validation of the Transfer and Assumption Request
You must click the Accept button to launch the Validation process. The system performs the following two validation sets:
The first set corresponds to Oracle Lease and Finance Management seeded validations.
The second set is user-defined and derived from the validation set selected in the 'Transfer and Assumption Validations' system option.
Submitting the Transfer and Assumption Request for Approval
After the request is successfully validated, submit the request for approval from the Transfer & Assumption search results table.
Activating the Transfer & Assumption Request
After a request is approved, the request can be activated. The activation flow is based on the following transfer types:
Complete Transfer
Partial Transfer
Complete Transfer
When you select all the assets in the contract for transfer, the type of transfer is 'Complete'. This is also called as full Transfer and Assumption.
On requesting activation of a full T&A request, the following events take place:
A new contract version is created.
Insurance policies, if any, are cancelled.
The lessee in the contract is automatically updated with the transferee information.
The transferrer is added as a 'Previous Lessee' party.
Third Party Insurance: If Third Party Insurance applies to the contract, either a new policy is created or the contract is linked to an existing policy associated to the new customer.
Fixed Asset Location: If a new Fixed Asset location is provided in the request, it is updated on the contract.
Asset Location in Install Base: The asset location is updated in Install Base.
A new asset location is created if the asset location in Install Base is not present for the new lessee.
If a new install location has not been specified on the request, then the system creates a party site as well as customer account site for the new customer for the existing install location. The system also creates party site use of Install At and customer site use of Install At and Ship To for the new customer.
Termination Quotes:
Any pending termination quotes which are not yet accepted are cancelled.
If termination quotes are already accepted, request activation is prevented and users have to cancel either the T&A request or the accepted termination quote.
Credit Memos: Credit memos are generated for invoices already billed to the transferrer with invoice dates after the request Transfer Date. Credit memos will either be invoice-based or on-account depending on the 'Transfer and Assumption Billing Adjustments' system option.
Invoices:
If invoices to the transferrer are credited, the same invoices are re-issued for the transferee.
Invoices in 'Entered' or 'Waiting for Consolidation' statuses will change to the 'Submitted' status.
The system will ensure evergreen billing streams are generated up to the transfer effective date.
If usage lines are present, the customer is updated in the associated service contract.
The contract's Collection Case in Oracle Collections is updated with the new customer.
The activation completes without new streams, accounting events or asset transactions being generated. After the T&A completes, the following contract modifications are not allowed:
Termination effective before the T&A effective date.
Rebook changes to the contract effective from date or payments due before the T&A effective date.
T&A or product change revisions effective before T&A effective date.
Principal paydowns effective before T&A effective date.
Renewals or refinance effective on or before T&A effective date.
Partial Transfer
When you select only a sub-set of the asset lines on the contract, it is called a partial Transfer and Assumption.
On requesting activation of a partial T&A request, the following events takes place:
A new contract is automatically created with the assets and transferee details defined in the request. The new contract Effective From Date is the same as the Transfer Date in the request. The asset amount for each transfer asset is calculated as follows:
Operating Lease: Present value of rent due after the transfer date plus the residual amount.
Direct Finance Lease: Net investment balance as of the transfer date.
The new contract also contains the following items:
A subsidy line with the unamortized balance (as of the transfer date) of subsidies associated to the transfer assets, if any.
Configuration fee lines (if associated to the transfer assets) with the principal balance as of the transfer date.
The new contract is not automatically activated but requires manual activation. This enables you to update the contract if needed.
Upon activation of the new contract, the financial asset lines in the original contract are terminated with an effective date one day before the request's Transfer Date. Any subsidies or configuration fees associated to the transfer assets are also terminated and not accelerated.
Credit memos are created for the transferrer if any invoices with dates after the transfer date have already been billed. Credit memos will be either invoice based or on-account depending on the Termination Billing Adjustments system option.
In Oracle Assets, the transfer assets are de-linked from the original contract number and linked to the transferee contract number. Fixed asset locations are updated. No off-lease transactions occur as the result of the T&A.
Any pending termination quotes for the transfer assets that have not yet been accepted are cancelled. If termination quotes are already accepted, request activation is prevented and users have to cancel either the T&A request or the accepted termination quotes.
Transfer and Assumption for Loan Contracts
For the Complete type of loan contracts, you can create Transfer and Assumptions requests.
Transfer and Assumption for Evergreen Contracts
You can create Transfer and Assumptions requests of type 'Complete' for evergreen contracts.
Define Billing Adjustments for Transfer and Assumptions
In the 'Transfer and Assumption Billing Adjustments' system option, you can define the type of credit memos to be generated for complete T&A in the operating unit. The options are:
Standard: On account credit memos are generated.
Invoice Based: Invoice based credit memos are generated.
Define Custom Validations for Transfer and Assumptions
In the 'Transfer and Assumptions Validation Set' system option, you can select a validation set for T&As in the operating units. The validations defined in the selected validation set are invoked when a request is accepted in addition to seeded validations.
Upon booking the new contract, if the Transfer Type is Complete (Full), Oracle Lease and Finance Management terminates the old contract automatically. If the Transfer Type is Partial, the old contract is rebooked automatically with the remaining assets.
When the assets are transferred, the credit line is adjusted. The Credit Line Details screen displays Total Transfers and Total Net Transfers.
Any subsidies on the old contract are processed based on the Subsidies Setup parameter, Transfer Basis: Acceleration (the subsidy is accelerated to the contract end) or Refund (the subsidy amount from the termination date to the contract end date is refunded to the vendor). You must add subsidies manually to the new contract.
As part of the termination processes of the original contract, Oracle Lease and Finance Management determines the amounts to be accrued up to the termination date for all accrual streams with the actual amounts. Any difference is adjusted.