Defining Operating Expense Categories

To define operating expense categories, use the Operating Expense Categories component (RE_EXP_CLASS).

This topic provides an overview of operating expense categories and lists the pages used to define operating expense categories.

Page Used to Define Operating Expense Categories

Page Name	Definition Name	Usage
Operating Expense Categories	RE_EXP_CLASS	Create an operating expense category.

Understanding Operating Expense Categories

When landlords lease properties to tenants, terms for recoverable expenses that are incurred on general operations and maintenance of the building are written into the lease. Operating expenses is also commonly referred to as common area maintenance (CAM). You can identify the different recoverable expenses incurred by assigning them to an operating expense category. Operating expense categories enable you to associate a transaction routing code to ensure that financial processing occurs to handle the expense.

Operating Expense Categories Page

Use the Operating Expense Categories page (RE_EXP_CLASS) to create an operating expense category.

Navigation:

Set Up Financials/Supply Chain, and then Product Related, and then Lease Administration, and then Financial Terms, and then LA Operating Exp Categories

This example illustrates the fields and controls on the Operating Expense Categories. You can find definitions for the fields and controls later on this page.

Field or Control

Description

Include in Lease Payments

Select to include the payment in both ROU (Right Of Use) Asset and Lease payments. If the check box is selected for an operating expense category, then the payments generated from the lease financial term having that operating expense category are included in the capitalized lease amount. If the check box is not selected, then the expense accounting using the LA accounting rules will be used to send the debit entry to the Accounts Payable.