Interaction between Lease Management and Asset Management

Leased assets differ from regular assets in this manner:

  • Leased assets are associated with a lease company that might or might not be the same as the asset company, and a lease number.

  • Leased assets are assigned a classification that must match the lease classification (operating or capital)

  • Operating leases can be tracked as assets, but they must have a zero book value.

  • More than one asset can be associated with a single lease but the total net book value of all the assets must match the lease obligation or the net present value (whichever is lower).

    Note: For more information, see the Lease Management User Guide.

What happens if you need to adjust, transfer, or dispose of a leased asset?

As long as you do not need to change the book basis of a leased asset, you can adjust and transfer a leased asset as you would a non-leased asset. Information on adjusting and transferring assets are found elsewhere in this user guide. Adjusting assets Transferring assets

If you need to dispose of an asset because the lease on the asset is terminating, you must first close the lease, then dispose of the asset. For more information on closing a lease, see the Lease Management User Guide Details on disposing assets is found elsewhere in this user guide. Disposing of assets

If you need to adjust an asset because, for example, you are buying the asset and terminating the lease early, you must first retire the lease, then adjust the asset. For more information on retiring a lease, see the Lease Management User Guide. Details on adjusting assets are found elsewhere in this user guide. Adjusting assets