Step 2: Register payment schedule with IFRS 16 classification

The overall currency for all payment schedules is defined on the contract card in the Payments section. Select the currency for all payment schedules. Note that it is not possible to have different currencies for different payment schedules. So, this choice is only necessary when registering the very first payment schedule on a contract.

Now, click Create payment schedule on the contract and register the payment.

Description: Enter an informative payment description.

Type: Here you select the type of contract. In most instances, it is an Obligation as IFRS 16-registrations usually relate to lessee obligations. This goes also for headleases. But for subleases, select Receivable.

Category: Select the category related to lease (dependent on the categories defined for your company).

Start date: Enter the start date of the contract.

Amount: Enter the amount that must be paid (either the total sum or the monthly payments in case of recurring payments).

This payment is recurring: Tick this checkbox in case of e.g. monthly recurring payments. This activates several additional fields:

• Interval start date: The start date of the payment. Usually, this field is filled in automatically. But in cases where the contract e.g. starts during an payment period, you can actively use this field in combination with the Divergent first period checkbox: Tick the checkbox, select the interval for your payment periods (e.g. 3 months) and enter the start date of the next period into the Interval start date field. This will tell the system that the contracts start date is in the middle of an ongoing period, and the time before the start date will be removed from the period amount. See also an example further below.

• Period: Select the correct payment period (e.g. monthly, quarterly, yearly).

• Stop date: The date the last period stops. The calculated stop date is displayed. Don't overwrite it: In case you later exercise the extension option on the contract, the field will be updated accordingly.

• Initial period amount: If you entered the Amount before you ticked the Recurring payment checkbox, the field is already filled in. It shall contain the period payment for the first payment. If there are later adjustments of the payments, these must be handled separately for the dates they occur. Read more about this under How to register planned adjustments.

• Monthly amount: Automatic calculation based on amount and period.

• Yearly amount: Automatic calculation based on amount and period.

Tip!
Check also that the First due date under Invoice details is correct. It determines the cash flow timing of the payment. Read more about invoicing under Invoices.

After you have entered the standard payment information, select the type of lease under IFRS 16 lease classification.

• Fixed payment: Here, you enter all fixed payments including those that are defined as variable payments but which de facto are fixed. Lease payments shall not be regulated.

• Variable payment linked to rate or index: Select this entry if you want to enter variable payments that are dependent on the development of an index (e.g. the consumer price index) or interest rate (e.g. NIBOR - the Norwegian currency swap rate)

• Variable payment linked to performance or use: Variable payments that are not dependent on any index or interest rate (e.g. payments per m², usage, time spent and more). These payments will not be displayed in the IFRS 16 reports.

• Purchase option: If it is probable that the lessee will purchase, select this entry. This gives you the possibility to enter more relevant information. See "How to register a purchase option" on page 160 for more information.

• Residual value guarantee: This is the amount you expect must be paid based on the residual value guarantees - the difference between agreed on and de facto value. Use this field only if the lessee is responsible for the residual value. Because usually the lessor is responsible for this. Use the stop date of the contract.
  Example! If the residual value of a car was agreed to be 30 000 EUR, and the agreement terms are complied with at the stop date of the contract, the difference is 0. But: If you drove more kilometers than agreed and the car has thus a lower value, the new value must be estimated and measured.

• Termination penalty: Fee for a terminated contract before official stop date. Enter e.g. a payment schedule called "Payment for termination of leasing contract" and use the stop date of the contract.

• Incentives: Incentives received from the lessor. Incentives can e.g. be pre-payments from lessor to lessee, a refund of various costs the lessee has (e.g. moving costs) or a free rental period.

• Prepaid lease amount: Used for any prepaid or accrued lease payments for this lease.

Now, you can check that all your entries are correct! Scroll down to the lists and control payments and periods:

 Under Obligation, you can check your periodic obligations; the list will also reflect obligation adjustments based on CPI-changes or similar if registered.

Cashflow will display the due date for your obligations.

If you registered contracts of a sublease structure, you will find the sublease contracts under Receivalbes.

Tip!
If you later register adjustments (e.g. index adjustments), a third list will be displayed here: Adjustments. This will contain all adjustment details for the contract. Read more under How to register planned adjustments.

Once you have registered your payment correctly, you must add the lease terms on the contract. See Step 3: Enter lease terms on the contract.