The activation function shifts leases from status Signed status to status Active. The system posts G/L entries for liability and RoU with commencement date as posting date.

Active leases run under the general lease lifecycle process – payments are posted according to the payment schedule, liabilities are posted according to the liability projection schedule, and RoU asset values are recognized according to the RoU projection schedule.

To activate the lease, navigate to Actions → Activate on the Lease Card:

To activate a batch of leases, select the leases you want to activate and use the same function from Actions → Activate in the Lease Agreements List page.

Every selected lease in the list has to be status Signed to activate, otherwise an error will be generated. 

 

On lease activation, the system will post the initial measurement of liability and RoU asset at the commencement date of the lease agreement.

For example, these are the balances of G/L accounts for a single lease after activation: