Create and Manage Leasing Agreement Using (STS100)

We recommend that you start the leasing process in Equipment Quotation Management (EQM), but a leasing line can also be specified manually using Rental Counter through 'Rental Agreement. Create' (STS085) or 'Rental Agreement. Open' (STS100).
This document describes how to create and manage leasing agreements manually using (STS100).
Note: If this process is used instead of EQM, any related orders for moving the equipment to correct warehouse or selling equipment to funder must be handled manually.

Outcome

A leasing agreement and agreement line is created with attributes, additional charges and curves according to the configuration done on the agreement line. If leasing method IRR is used, cash flow components are also created.

By creating a leasing line you have reserved a quantity for an item number/serial number to be leased out to a customer.

The leasing lines are used to perform these tasks:

  • Lease out equipment to the customer.
  • Keep track of the equipment during the time span of the leasing agreement.
  • Invoice the customer.

Before you start

These settings should be verified before you start:

  • Set the system calendar in 'System Calendar. Open' (CRS900) to cover the leasing period as a minimum.
  • For leasing charges to be connected automatically using attribute functionality on the leasing line, the contract item for the leasing charge must exist in 'Contract Item. Open' (SAS450) and this charge ID must be the same as an attribute value connected to the attribute model for this item number in 'Item. Open' (MMS001). The charge ID must also be activated to create a leasing charge through the 'Auto-create charge' setting in (SAS450).
  • Set leasing method to 0-'Standard' or 1-'IRR' in 'Rental Agreement Order Type. Open' (STS020) to determine if the standard or IRR calculation method should be used to calculate the leasing curve.

Follow these steps

Follow these steps to create a leasing agreement outside of EQM.

  1. Open (STS100) and go to the lines using option 2='Change' or 11='Lines'.
  2. Select line type 'L', item and quantity on 'Rental Agreement. Open Lines' (STS201/B1).
  3. Specify the delivering warehouse.
  4. If the serial number is known at this stage, you can set it as well. Confirm with Enter.
    Note:  It is possible to mix rental lines and leasing lines on the same rental agreement header, even though it is preferable to use different order types for these flows.
  5. When all settings are completed for the order line to be created, 'Rental Line. Convert to Leasing' (STS106) is displayed. If needed, specify any missing data and confirm with Enter on all panels of (STS201) to display (STS106).
  6. If leasing method 0-'Standard' is used, specify the correct number of periods (defaulted from rental order type), interest type, interest rate (defaulted from interest type), residual percentage and sales price in (STS106). Confirm with Enter.

    If leasing method 1-'IRR' is used, specify the correct number of periods (defaulted from the rental order type), IRR, residual percentage, and cost price in (STS106). Confirm with Enter.

  7. Click 'Display' to view the calculated curves.

    Edit curves in (STS106). Press Enter to trigger the calculation of new curves.

    When completed, close (STS106) to return to (STS201).

  8. To view, add, or update a leasing charge, use related option 15='Addnl charges' in (STS201) to open (STS103).
    Note: If the item is set up for attribute handling and corresponding contract items exist for the connected attribute values, leasing charges have been automatically created in 'Rental Agreement. Connect Additional Charge' (STS103).

    If a leasing charge that has been added using attribute functionality should be deleted this must be done through the attribute. Use related option 52='Attribute Values' in (STS201) to open 'Attribute Value. Connect to' (ATS101) and remove the attribute value. This will automatically remove the connected leasing charge.

  9. To view, add, or update a cash flow component, use related option 55='Cash Flow Component. Open' to open 'Cash Flow Component. Open' (STS136). To view the curve for each cash flow component, use related option 11='Cash Flow Curve. Open' in (STS136) to open 'Cash Flow Curve. Open' (STS138).
    Note: Cash flow components can only be used in combination with leasing method 1-'IRR'.
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