Terminate Expired Contracts in Oracle Lease and Finance Management(OLFM)

• Run the Standard Concurrent Program"Terminate Expired Contracts"  to set the status of contracts to "Expired". 

• This step will create the off-lease amortization transaction for each asset in Lease and Finance Management. 

• The following steps or activities are performed when processing terminated expired DF lease contracts:

1. Eligible for Termination:- Checks if billing is complete up to the termination date (only if contract has expired).
2. Close Balances (Write-off Small Balances):- Creates adjustment transactions for the balances less than tolerance amount (Only for Full Termination).
3. Post Accounting Entries:-

• Creates termination accounting entries.
• Creates accrual accounting entries for catch-up (i.e., transfer accruals from non-income bucket to income bucket). Only for Full Terminations.
• Reverse loss provisions. Only for Full Terminations.
• Reverse accruals (if excess accruals exist). Only for Full Terminations.
• Accelerate income accrual recognition for financed fees. Only for Full Terminations.
• Accelerate income recognition or refund subsidy (based on subsidy setup).

      4.Dispose Asset:-

• Retires assets in Fixed Assets. Expires Item in Install base. Retires asset in FA on quote effective from date.

     5.Amortize Asset (Create Off-Lease Amortization):-

•   Creates off-lease amortization transactions in Lease and Finance Management, which are then processed into Fixed Assets (to adjust depreciation). Off-lease amortization transaction date is set to quote effective date.

     6. Create Asset Return:-

• Creates asset return record in Lease and Finance Management with return status as Scheduled. 

     7. Update Contract Status (streams, contracts and contract lines):-

• Updates stream status to HISTORIZE (except for residual value and investor contract obligation payable streams).
• Sets the lines and contract to Terminated. Sets date terminated as quote effective from date. (Only for Full Termination). If the contract is evergreen eligible the contract and lines are updated to Evergreen status. Along with that off-lease amortization and Termination accounting is also done for the contract.

     8.Update Contract Details (payments, contract lines):-

• Updates the payments i.e. remove future payments for terminated assets after termination date.
• Updates lines to Terminated for all the terminated financial assets. If the financial asset is attached to service or fees, terminates those sub lines as well. Terminates the primary service or fee line if all sub-lines terminated. (Does not terminate those primary service and fee lines that do not have any sub lines).
• Launches mass Rebook, which Rebooks the contract. Sets Rebook date as quote-effective date. Pass terminated assets to Rebook API. (Only for Partial Termination).