PeopleSoft Asset Management and PeopleSoft Lease Administration: Adapting to Change Session Number

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2 PeopleSoft Asset Management and PeopleSoft Lease Administration: Adapting to Change Session Number Loida Chez PeopleSoft Product Strategy James Quijas Boise Cascade Company July 18, 2018

3 Safe Harbor Statement The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions. The development, release, and timing of any features or functionality described for Oracle s products remains at the sole discretion of Oracle. 3

4 Legislative Versatile Contemporary 4

5 Lease Accounting Development Approach Phased Enhancement Rollout (9.2 Only) Phase 1 Phase 2 Phase 1 (Foundation) Extend enterprise-wide frameworks to Real Estate Management Tighter integration with Asset Management Phase 3 Phase 4 Phase 2 (Foundation) Accounting for finance and operating payables leases for all asset types (property and equipment) Lease Accounting Hierarchy Enhanced amendment processing 5

6 Lease Accounting Development Approach Phased Enhancement Rollout (9.2 Only) Phase 1 Phase 2 Phase 3 (Lessee Accounting) Multi-asset leases Dynamic lease classification at asset level More precise data capture of financial terms Allocation of lease payments Phase 3 Phase 4 Phase 4 (Migration and Transition) Introduction of Asset Management s shared product functionality with Lease Administration Activity Guide Migrate Asset Management leases to common lease data structure Transition to new FASB and IASB leasing guidance 6

7 Shared Product Functionality 7

8 Shared Product Functionality Single Data Structure and UI for Payables Leases Asset Repository Finance and Operating Leases Track leased assets in Asset Management s asset repository Depreciation & Straightlining Asset Management Lease Administration Manage both operating and finance leases for all asset types (property and equipment) Lease Payments Depreciation and straightlining enable the subsequent measurement and recognition of leased assets Integration with Accounts Payable for lease payments 8

9 Shared Product Functionality Asset Management Core accounting requirements for payables leases (lessee agreements) Single-asset leases (finance and operating) Multiple Financial Terms Integration with PeopleSoft Accounts Payable Straightline Accounting Amendment Processing Manual Fees Lease Administration Core accounting requirements for payables leases plus advanced leasing requirements Leasing functionality available to Asset Management-only customers Multi-asset leases (finance or operating) Clauses Options and Critical Dates Operating Expenses (CAM) Percent Rent Security Deposits Lessor (operating leases only) Site Selection and Acquisition My Lease Portfolio Lease Administration Reports (i.e. Lease Abstract, Property Occupants, Rent Variance, etc.) 9

10 Shared Product Functionality Asset Management Lease Administration Asset Management > Asset Transactions > Leased Assets > Create New Lease Lease Administration > Payables Leases > Create New Lease 10

11 Shared Product Functionality Asset Management Lease Administration Asset Management > Asset Transactions > Leased Assets > Create New Lease Lease Administration > Payables Leases > Create New Lease 11

12 Migration of Asset Management Leases to Shared Lease Data Structure 12

13 Migration Tasks 13

14 Initial Assessment of Asset Management 14

15 Pre-Migration Configuration 15

16 Pre-Migration Configuration 16

17 Pre-Migration Configuration 17

18 Transaction Routing Codes What are they? How are they used? Define default taxation rules for lease-related transactions Establish unique accounting rules Associated with one or more transaction types or transaction groups Required for LA Business Unit configuration 18

19 Pre-Migration Configuration 19

20 Lease Administration Business Units What to Consider Asset Management Business Unit Mapping One AM BU-to-Many LA BU allowed but MUST map to the same GL BU GL BU selected for LA BU drives AM BUs available for selection Contracts BU applies to receivables leases Journal Template Use AM Accounting Templates Option Limits, Measures, Calendars Unit of Measure Base Currency and Currency Rate Type Lease Calendar and Proration Method Thresholds for Lease Classification Transaction Settings Lead Time (Days) Transaction Routing Codes 20

21 Pre-Migration Configuration 21

22 Role Types What are they? How are they used? Define lease contacts External Contact Internal Administrator Internal Manager Lease Principal Establish who can activate leases If auto-approval is enabled, Internal Administrator or Internal Manager can activate leases If auto-approval is disabled, only Internal Managers can activate leases Minimum configuration required is one Internal Administrator and one Internal Manager 22

23 Pre-Migration Configuration 23

24 Lease Administration Roles Lease Administrator and Portfolio Manager Organize leases by Lease Administrator and Portfolio Manager Required for lease entry 24

25 Pre-Migration Configuration 25

26 Pre-Migration Configuration 26

27 Pre-Migration Configuration Lease Type Region Code Interim Rent Lease Administrator Portfolio Manager 27

28 Pre-Migration Configuration Lease Type Region Code Interim Rent Lease Administrator Portfolio Manager Lessor (if not populated) 28

29 Migration Process 29

30 Migration Process 30

31 Migration Process 31

32 Migration Process 32

33 Lease Data Migration Pre-Migration Post-Migration Asset Management > Asset Transactions > Leased Assets > Update Lease Information Navigation for Customers Licensed Only for AM: Asset Management > Asset Transactions > Leased Assets > Maintain Lease LA Navigation: Lease Administration > Payables Leases > Maintain Lease 33

34 Transition of Leases to New Leasing Guidance 34

35 Transition Tasks 35

36 Transition Tasks Adoption date Lease payments dated on or after the transition date are included in the present value of lease payments (PVLP) and right-of-use (ROU) asset cost 36

37 Preparing for Transition to New Leasing Guidance 37

38 Preparing for Transition to New Leasing Guidance 38

39 Review Leases Multiple Operating Expense Categories Operating Expense Categories are configured to be either included in lease payments or not included in lease payments Amend leases to create distinct operating expense schedules for amounts included in lease payments and amounts not included in lease payments 39

40 Review Leases Overlapping Payment Dates Within a Payment Group Overlapping payment dates are not allowed for a single payment group and financial term Amend leases by adjusting the Payment Group for the overlapping payment dates 40

41 Review Leases Gaps in Payments Payment Group 1 must span the entire lease term. Amend leases to adjust the gaps in payment dates (i.e. free rent periods) 41

42 Preparing for Transition to New Leasing Guidance 42

43 Preparing for Transition to New Leasing Guidance 43

44 Preparing for Transition to New Leasing Guidance 44

45 Preparing for Transition to New Leasing Guidance 46

46 Preparing for Transition to New Leasing Guidance 47

47 Preparing for Transition to New Leasing Guidance 48

48 Preparing for Transition to New Leasing Guidance 49

49 Transition to New Leasing Guidance 50

50 New Accounting = New Transaction Type Lease Expense 51

51 Transition to New Leasing Guidance 52

52 Transition to New Leasing Guidance 53

53 Transition to New Leasing Guidance 54

54 PeopleSoft ALM Roadmap & Features Under Review GASB 87 for Lessees Accounting for Variable Lease Expenses Recognition of non-monthly lease expense Lease Rent Holidays Lease Data Import 55

55 For More Information: For General Information, go to: PeopleSoft Online Hosted Help (Asset Management and Lease Administration): Lease Administration Red Paper and FAQ Documents: My Oracle Support Doc ID Lease Accounting Video Feature Overview: YouTube Lease Accounting Spotlight Video: html PeopleSoft Apps Strategy Blog: 56

56 Questions? 57

57 Get Connected and Stay Informed Key PeopleSoft Information Sources PeopleSoft Information Portal PeopleSoft YouTube Channel Social Oracle PeopleSoft Page Oracle PeopleSoft Development Group Blogs 58

58 Engage with Oracle s PeopleSoft Sales Team Oracle Digital License Sales Team Interested in purchasing PeopleSoft? Want to expand your PeopleSoft usage? Need PeopleSoft licensing help? Contact the Oracle Digital team licensesales-naa_us@oracle.com 59

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