Change Base Index

Explanation

This activity is used to change the base lease index value. Click Change Base Index in Amortization Schedule tab of the Lease Accounting Contract page to update the base index values.

Note:
Base Index Rate: The value which is available in the Base Index column in Amortization Schedule is fetched by default. User can change the suggested values, if required. Zero and negative values are not allowed.
New Index Rate: The applicable value in Lease Index Type page for the Payment Due Date of the selected installment is fetched by default. User can change the suggested values, if required. Negative values are not allowed.

Prerequisites

In order to change the base lease index value, the following must have been completed:

• Lease Index Type must have been created in the Lease Index Types window and it should be attached to a lease contract.
• Terms and conditions line should exist in the Category, Standard Terms in the Terms and Conditions sub tab for the same contract.
• An Amortization Schedule should have been created for that lease contract.
• Status of the lease contarct should be in the status Preliminary.
•  New base index values should be updated in the Lease Index Types window which is used in the selected contract

System Effects

As a result of this activity, the base lease index value will be updated to reflect it in the future cash flows and the present value calculations therein.

Also, it will show a difference in the Difference in Liability by comparing the Lease Liability Beginning Balance of the selected schedule line and the Lease Liability Ending Balance of the previous line.

Pages

Lease Accounting Contract

Activity Diagrams

Modify Lease Contract