ELA: Last Period Depreciation Book To Gain/Loss When Lease Expired
(Doc ID 2575737.1)
Last updated on JANUARY 25, 2021
Applies to:PeopleSoft Enterprise FIN Lease Administration - Version 9.2 to 9.2 [Release 9]
Information in this document applies to any platform.
The company has a 4-4-5 calendar and lease term and depreciation term may not be the same. Depreciation may pass by 1 period in some cases. For instance, when the lease is between 1/1/2018 to 12/31/2018, the lease has 12 monthly payment term, but the asset useful life is 13 as 12/31/2018 falls in FY 2019 Period 1.
When a lease is expired, lease is marked expired automatically and the asset is disposed automatically when the Manage Transaction Generator is run. The last period depreciation is removed and the retirement entry books the last period depreciation to Gain/Loss account which is incorrect. The system should book the last month depreciation and then book no Gain/Loss for retirement.
This issue can be replicated by performing the following steps:
1) Create a lease for Lease Term 12 with commencement 01/01/2018 and Termination 12/31/2018. You are entering the transactions in period 13 vis a vis the termination date.
2) Add a lease equipment with a 4-4-5 calendar in AM.
3) Add base rent for a Monthly Lease Term and Payment Type Advance.
4) Activate the Lease.
5) Run depreciation.
6) Create accounting entries.
7) Close depreciation for period 12.
8) Run Manage Transaction Generator.
9) Lease is expired.
10) Asset is disposed.
11) Run depreciation for the retirement.
12) Create accounting entries.
13) Note that RET gain/loss is booked in period 13.
See Replication Steps Attached.
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