1. Using Lease Accounting
  2. Create Lease Amendment

Create Lease Amendment

You can start the lease amendment from the Lease Landing page.

You can start by searching for a lease that you want to amend.

  1. Select the lease.

  2. Click Amend Lease from the Actions menu to open the Amend Lease page.

Amend Lease Page:

  1. You need to enter the following information in the Amend Lease page:

    Field

    Description

    Amendment Name

    Retain or modify the amendment name for the lease.

    Subtype of Amendment

    Scope Increase - In this amendment, you can add assets, payment terms, or options or extend the asset term.

    Scope Decrease - In this amendment, you can reduce the life of the lease or an asset, make changes to payments, add termination, and purchase options. Oracle Lease Accounting calculates the gain or loss for the Scope Decrease amendment and generates the accounting part of the Lease Revision Accounting event.

    No Scope Change - In this amendment, you can change the related asset information that doesn't change the scope of the lease.

    Edit Non-Financial Data: In this amendment, you can change the nonfinancial data of the asset. For example, you can change the code combinations for a few Accounting Classes on the payments.

    Amendment Commencement Date

    Select the amendment commencement date of the lease.

    Note: The amendment commencement date can't be in the future.
    Note: The amendment commencement date can't be before another amendment commencement date on the lease.
    Note: You must process or hold all the lease payments before the amendment commencement date for the processing of the amendment.

    Prepared By

    Retain or modify the name of the user amending the lease.

    Notes

    Enter any relevant information regarding the amendment.

  2. Click Save and Continue

Lease Accounting displays the entire lease contract. You can modify the lease information in the various tabs by selecting the type of amendment. The lease is currently in Working version status and Draft lease status.

Click Validate to validate the amendment.

Click Generate Schedules to update the schedules. You can review the amended schedules before activation of the amendment.

Click Activate to activate the amendment. The lease moves to Finalized version status and Active lease status.

Click Discard if you want to abandon the amendment.

You can view the new version of the lease in the History tab.

Amendments can lead to reductions of Right of-Use and Lease Liability balances or recalculation of liabilities. In reduction, Lease Accounting compares the reduced balances of right-of-use and liability to derive gain/loss.

In recalculation of the Lease Liability, Lease Accounting takes the difference between the existing lease liability and the recalculated lease liability. Lease Accounting adds or subtracts from both liability and right-of-use balances.

When you change the scope on the lease, Lease Accounting uses the discount rate on the amendment commencement date for all recalculations.

During Scope Increase, you can change the index rate or the rate adder. You can also move to a new index.