1 Termination

1.1 Introduction
Termination is the process of ending a leasing transaction with the
lessee. Broadly there are three types of terminations supported in
Lease management for Lease Contracts
• Full Termination
Lease management provides the capability to terminate all
elements of a Lease contract.
• Partial Termination
Lease management provides the capability to terminate such
assets off the contract without requiring the creation of a new
contract.
• Contract Expiration
Lease management provides the capability for automated
termination of the contract at End-of-Term.
Partial and Full terminations can happen at different points in the
Contract life-cycle. These stages in the life cycle are represented by
different status of the Contract.

1.1.1 Termination Quotes

Termination quotes allow contracts or assets on a contract to
terminate early or at the expiration of the contract. Termination
quotes identify the financial impact of the termination. Various
business rules that were specified in the contract’s terms and
condition are the basis of calculating the financial impact of a
termination quote.
• Partial Termination
Termination is the process by which Lessee can choose to end
some or all of the assets or financed lines on a contract. When
lessee terminates a part of contract it is called partial
termination. In partial termination, the lessee or vendor is billed
for termination amount and contract is rebooked with the
remaining assets that were not terminated. In full termination,
 all assets on the contract are terminated, the lessee or vendor
is billed for the termination amount and the contract is
terminated.
• Full Termination
In full termination, all assets on the contract are terminated,
the lessee or vendor is billed for the termination amount and
the contract is terminated.
• Termination with Purchase
In Termination with Purchase, the lessee or vendor purchases
the leased asset along with paying off the remaining rent
obligation by paying the termination amount to the lessor. A
termination with purchase results in retiring of the original
equipment from the lessor’s book.
• Termination without Purchase
In Termination without Purchase, the lessee or vendor pays
only the remaining rent obligation and returns the asset. The
asset is placed in an off-lease status and is available for
remarketing or disposal once returned back to the lessor.

1.1.2 Termination Quote Types

• Termination - With Purchase
For any lessee or guarantor who wants to purchase the asset.
• Termination - Without Purchase
For any lessee or guarantor who does not want to purchase the
asset.
• Termination - Rollover To New Contract With Purchase
For any lessee or guarantor who has an existing contract, and
wants to purchase the asset and finance the termination quote
amount.
• Termination - Rollover To New Contract Without Purchase
For lessee or guarantor who has an existing contract, does not
want to purchase the asset, but wants to finance the
termination quote amount.
• Termination - Recourse With Purchase
For a vendor who wants to terminate the contract and/or
purchase the asset based on the terms and conditions of the
Vendor Program Agreement.
 • Termination - Recourse Without Purchase
For a vendor who wants to terminate the contract based on the
terms and conditions of the Vendor Program Agreement.
• Termination - Automatic Release Without Purchase
For anyone who wants to release the assets from one contract to
another.
• Termination - Manual With Purchase
For any lessee or guarantor to whom we have issued the
manual termination quote and who wants to purchase the
asset.
• Termination - Manual Without Purchase
For any lessee or guarantor to whom we have issued the
manual termination quote and who does not want to purchase
the asset.

1.2 Setup related tables (both OLFM / other EBS product)

Responsibility Steps to define Screen shot Comments

setups
Lease super user Terms and -if approval is
conditions → required.
1. Conditions for -partial termination
Partial Termination allowed
Quote
Termination Quote
Calculation - Early
Termination,
Contract
Termination Quote
Calculation - End
of Term, Contract
Termination Quote -Manual quotes
Process allowed
-Early termination
allowed
-First Termination
Responsibility Steps to define Screen shot Comments
setups
date
-Send bill of sale
-Quote effectivity
-Term status
Early Termination A pre-defined fixed
Purchase Option, price that is
Contract agreed to by the
lessor/lessee while
writing a contract.
End of Term
Purchase Option,
Contract

1.3 Processes
N/A

1.3.1 Transactions

Deal Type Termination Quote Transactions

OP Lease/DF Lease Termination without
purchase
Full Termination
OP Lease/DF Lease/Sales Termination with
type Lease purchase
Full Termination
• Validate contract
• Cancel Insurance
• Close balances
• Post Accounting
Entries
• Amortize Asset
• Create Asset Return
• Update Contract,
Close Streams
• Validate contract
• Cancel Insurance
• Close balances
• Post Accounting
Entries
Deal Type Termination Quote Transactions
• Dispose Assets
• Update Contract,
Close Streams
loan/revolving loan full termination • Validate contract
• Cancel Insurance
• Close Balances
• Post Accounting
Entries
• Dispose Assets
• Update Contract,
Close Streams
OP Lease/DF Lease Termination without • Validate contract
purchase • Split Asset (needed
Partial termination if partial unit termination)
(not shown as a step on
the screen)
• Cancel Insurance
• Post Accounting
Entries
• Amortize Asset
• Create Asset Return
• Update Contract,
Close Streams
• Rebook the contract
(not shown as a step on
the screen, part of
update contract step)
OP Lease/DF Lease Termination with • Validate contract
purchase • Split Asset (needed
partial termination if partial unit termination)
• Cancel Insurance
• Post Accounting
Entries
• Dispose Assets
• Update Contract,
Deal Type Termination Quote Transactions
Close Streams
• Rebook the contract
loan/revolving loan partial termination • Validate contract
• Split Asset (needed
if partial unit termination)
• Cancel Insurance
• Post Accounting
Entries
• Dispose Assets
• Update Contract,
Close Streams
• Rebook the contract
Termination of a contract Contract could have • Validate contract
can also be done at the evergreen terms and • Cancel Insurance
end of term of contract conditions set in which • Close balances
by running the case • Close Streams
“Terminate Expired Validate contract • Post Accounting
Contracts” concurrent Set to Evergreen Entries
program. • Amortize Asset
• Create Asset Return
Update Contract

1. Validate Contract :
Checks if billing for the contract has been performed if the request is from
“Terminate Expired Contracts” concurrent program.

2. Set To Evergreen :
If the contract evergreen terms and conditions are set to “true” then the
contract status is set to evergreen

3. Cancel Insurance :
Cancels insurances related to the contract

4. Close Balances :
If the remaining balance is less than the tolerance (specified in the profile
“OKL: Small Balance Write-Off Tolerance”, Lease Management creates
adjustments for the balance.

5. Close Streams :
Closes all the streams associated to the contract if it is a full termination. If
it is a partial termination then streams associated to the quoted assets are
closed.

6. Post Accounting Entries :

Does accounting for all the termination accounting templates.
• Does catchup of accruals for the contract if needed.
• Does reversal of loss provisions for the contract if needed.
• Does accelaration of accruals for IDC expense for fees.
• Does processing of discounts and subsidies attached to the
contract.
• Dispose [of] Asset : Assets are retired in Oracle Fixed Assets
Amortize Asset : Off-lease amortization transactions are created in Oracle
Lease Management for depreciation of asset value in FA Tax and Corporate
books.

1. Amortize Asset : Off-lease amortization transactions are created in

Oracle Lease Management for depreciation of asset value in FA Tax and
Corporate books.

7. Create Asset Return : An asset return request is created in Oracle

Lease Management which will be used for repossession, remarketing etc.

8. Update Contract : If any of Steps required errors, then the

termination transaction has an “error” status and the contract remains
“Booked”.

However if it is a full termination and all the required steps have

processed successfully then the contract and line statuses are
updated to “Terminated”/”Expired”. If it is a partial termination and
all the required steps have processed successfully then the quoted
line statuses are updated to “Terminated” and the contract is
rebooked.
 1.4 Tables / Views involved

Table/View Column name Value Comments

OKL_TRX_QUOTES_B

OKL_TXL_QUOTE_LINES_B

OKL_TXD_QUOTE_LINE_DTLS

OKL_QUOTE_PARTIES

OKL_CASH_FLOW_OBJECTS

OKL_CASH_FLOWS

OKL_TRX_QTE_CF_OBJECTS

OKL_TRX_MSGS

OKL_TRX_CONTRACTS

1.5 APIs (Public/Private)

API Name Public/Private Comments

Termination Quote
Creation
• OKL_AM_CREATE_
QUOTE_PVT
• OKL_AM_CALCULAT
E_QUOTE_PVT
• OKL_AM_CALC_QU
OTE_STREAMS_PVT
API Name Public/Private Comments
• OKL_AM_PARTIES_
PVT
• OKL_AM_CALC_QU
OTE_PYMNT_PVT
• OKL_AM_QUOTES_
WF

Termination Quote
Acceptance
• OKL_AM_TERMNT_
QUOTE_PVT

Termination Workflow
• OKL_AM_QUOTES_
WF
• OKL_AM_SECURITI
ZATION_PVT
• OKL_AM_INVOICES
_PVT
• OKL_AM_SERVICE_
K_INT_WF
Termination transactions
• OKL_AM_LEASE_LO
AN_TRMNT_PVT
• OKL_AM_LEASE_TR
MNT_PVT
• OKL_AM_LOAN_TR
MNT_PVT
• OKL_AM_CNTRCT_L
N_TRMNT_PVT
• OKL_AM_RECYCLE_
TRMNT_PVT

Expiration
• OKL_AM_BTCH_EXP
API Name Public/Private Comments
_LEASE_LOAN_PVT

1.6 SQL script to find data in the related tables

Sql Script Expected Data Comments

1.7 Known Issues

N Issue
o
If termination transaction failed with
error "Amortized adjustments are not
allowed
for asset book"
terminaton with purchase
error: Quote Effective From date 15-
JUL-2012 can not be after Fixed
Assets calendar period close date
Resolution
Log on to FA > Setup > Asset System
> Book Controls.
Query the book and check 'Allow
Amortized changes' checkbox under
Accounting Rules tab
asset period can be opened by
running the depriciations. it opens
only the next period. so have to run
depriciations multiple times to get to
the quote effectve from date. or
create a contract within that
effectivity.