Create and Manage Leasing Agreement Using EQM With Funder

This document describes how to create and manage a leasing agreement using the leasing process in Equipment Quotation Management (EQM). This routine should be used when the equipment should be funded by an external funder.

We recommend that you start the leasing process in EQM, but a leasing line can also be specified manually using Rental Counter through 'Rental Agreement. Create' (STS085) or 'Rental Agreement. Open' (STS100).

Outcome

Before you start

These settings should be verified before you start:

Create leasing line through EQM for sales warehouse

Follow these steps if equipment is placed on, or is sourced to, a sales warehouse and is funded by an external funder.

  1. Open 'Financial Agreement. Open' (AGS100) and create a financial agreement according to your agreement with the funder.
  2. Connect a line to the financial agreement in 'Financial Agreement. Open Lines' (AGS101), using related option 11='Agreement Lines' . If equipment is not yet known, leave item and serial number blank. Use the correct fixed asset type for right-of-use (ROU) asset.

    This step can be done later in the flow.

  3. Open EQM to create the quote according to the agreement with your customer.
  4. In EQM, select the quote to be leased by your customer. Click 'Details' to display EQM details.
  5. Select the line to be leased. Use related option 16 ='Add Financing' and select a suitable financing option, including funder in the setup in 'Quotation. Add Financing' (QUS116). It is important that the financing type is 3-'Leasing'. If needed, new financing options can be added using the plus icon.
  6. From the EQM header or EQM details, click 'Create order' to trigger the creation of leasing lines and a CO for internal movement.

    The leasing line is created on a temporary rental agreement according to the settings in (QUS116).

    The CO for internal movement is created with zero sales price, if equipment needs to be moved. This depends on the rental depot in 'Quotation Type. Open' (QUS020). If this is not the same as where the equipment is placed (sales warehouse), a CO is created to move the equipment. The receipt at the rental warehouse is done with transaction ID '90'.

    If equipment is configured on the quote, a work order (WO) is created that is connected to the CO to make the equipment ready according to the configuration.

    The orders related to the quote can be found using the fulfillment tab in EQM.

  7. Open (AGS100). Use related option 11='Agreement Lines' to open (AGS101). Update the existing line in (AGS101) when the item and serial number is known.

    If no financial agreement has been created yet, this must be done first (see step 1).

  8. If a work order exists, report it using standard procedures.
  9. Report the customer order using standard procedures, for movement to correct warehouse.

    If serial number was set at quote creation, but is no longer correct, change this when reporting the CO. This updates the connected leasing line.

  10. Use the automatically created CO to sell the equipment to the funder. This does not affect the stock balance. Invoice the CO according to the agreement with the funder.
  11. Open (AGS100). Use related option 11='Agreement Lines' to open (AGS101). Create a proposal for the line with related option 6= 'Create proposal' in (AGS101) (if one does not already exist) and activate the line with related option 9='Activate' in (AGS101). The asset is automatically created and activated in 'Fixed Asset. Open' (FAS001) classified as right-of-use (ROU). The serial number is updated in 'Equipment/Serialized Item. Open' (MMS240).
  12. Report delivery of the equipment to the customer through the rental agreement or leasing line, using standard procedures in 'Rental Logistics Toolbox. Open' (STS140) or Rental Counter.
  13. During the lifetime of the leasing agreement, the customer is invoiced through the rental agreement, using standard procedures in 'Rental Invoice Proposal. Create' (STS800) and 'Rental Invoice Proposal. Update' (STS810).

Create leasing line through EQM for rental warehouse

Follow these steps if the equipment is placed on a rental warehouse and to be funded by an external funder:

  1. Check if a financial agreement exists in (AGS100) and (AGS101) for this equipment and if it is still valid.
    1. If active financial agreement exists, the asset should exist in (FAS001) with the correct FA type for the right-of-use asset.
    2. If no financial agreement exists, but the equipment is placed in (FAS001) this financial asset must be disposed of using 'Fixed Asset. Dispose' (FAS145).
    3. If financial agreement is missing, probably because the equipment has not been funded before, create a financial agreement using (AGS100) and (AGS101). A right-of-use asset is created when the financial agreement is activated.
  2. Open EQM to create the quote according to the agreement with the customer.
  3. In EQM, select the quote to be leased by your customer. Click 'Details' to display EQM details.
  4. Select the line to be leased. Use related option 16 ='Add Financing' and select a suitable financing option. It is important that the financing type is 3-'Leasing'. If needed, new financing options can be added using the plus icon.
  5. From the EQM header or EQM details, click 'Create order' to trigger the creation of leasing lines. The leasing line is created on a temporary rental agreement according to the settings in (QUS116).

    No CO for internal movement is created in this scenario. Since that CO is the trigger for the funder CO, no funder CO is created even if a funder is set in (QUS116). If the equipment should be sold to funder and has not been funded before, the funder CO must be created manually. Use the same CO type as the one connected in (OIS278).

    The rental agreement related to the quote can be found through the fulfillment tab in EQM.

  6. If not already done in step 1, activate the financial agreement through (AGS100). Use related option 11='Agreement Lines' to open (AGS101). Create a proposal for the line with option 6='Create proposal' in (AGS101) if not already done and activate the line with option 9='Activate' in (AGS101). This automatically creates and activates the asset in (FAS001), classified as right-of-use (ROU). This also updates the serial number in (MMS240).
  7. Report delivery to the customer through the rental agreement or leasing line, using standard procedures in (STS140) or Rental Counter.
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