Deal Modifications: Scenario Quick Reference
Use the tables below to look up any modification scenario and find the corresponding steps in the Deal Modifications User Guide.
Payment and term changes
| Scenario | Record Event path | Key sections | Special note |
|---|---|---|---|
| Renegotiated payment structure (flat or step payments) | Record Payment > Record payment change with contract renegotiation | Verify payments; Update LRF, Calculator, or enter payments manually; Step 4 Summary; Classify & Book | - |
| Modified step payment structure | Record Payment > Record payment change with contract renegotiation | Verify payments; Payment Schedule Calculator; Step 4 Summary; Classify & Book | - |
| Payment due date / anniversary change | Record Payment > Record payment change with contract renegotiation | Set Date of Modification to new anniversary date; Step 4 Summary; Classify & Book | Date of Modification = new anniversary date |
| Reduce payment for existing term | Record Payment > Record payment change with contract renegotiation | Verify payments; Update LRF, Calculator, or enter payments manually; Step 4 Summary; Classify & Book | Material renegotiation judgment required |
| Increase payment for existing term | Record Payment > Record payment change with contract renegotiation | Verify payments; Update LRF, Calculator, or enter payments manually; Step 4 Summary; Classify & Book | Material renegotiation judgment required |
| Frequency change (e.g., monthly to quarterly) | Record Payment > Record payment change with contract renegotiation | Verify payments (recalculate); Update Frequency; Step 4 Summary; Classify & Book | - |
| Shorten lease term / reduce payment | Record contract modification > Record reduction in term | Verify payments (reduce); Update LRF, Calculator, or enter payments manually; Step 4 Summary; Classify & Book | - |
| Extend lease term / decrease payment | Record Payment > Record payment change with contract renegotiation | Verify payments (increase); Update LRF; Step 4 Summary; Classify & Book | - |
| Change in payment / FMV / add renewal option | Record Payment > Record payment change with contract renegotiation | Update LRF, Calculator, or enter payments manually; Configure EOT options; FMV special case in Step 1; Reclassify; Book | Update Unit Price in Details tile after saving modification; Reclassify before booking |
Adding assets
| Scenario | Record Event path | Key sections | Special note |
|---|---|---|---|
| Adding asset: not at stand-alone price | Record contract modification > Add asset(s) | Configure EOT options; Step 2: Add Assets; Step 4 Summary (Commensurate drop-down); Classify & Book | - |
| Adding asset: at stand-alone price (commensurate with market) | New lease entry (not a modification) | Coterminous lease section | Do NOT use Modify Deal workspace |
| Adding asset and shortening the term | Record contract modification > Add asset(s) | Verify payments (reduce); Configure EOT options; Step 2: Add Assets; Step 4 Summary; Classify & Book | - |
Removing assets
| Scenario | Record Event path | Key sections | Special note |
|---|---|---|---|
| Removing an asset: reclassification expected (modification required) | Record contract modification > Add asset(s) | Configure EOT options; Step 3: Remove/Reduce Assets; Step 4 Summary; Classify & Book | - |
| Removing an asset: partial termination (no reclassification) | Record Asset Event > Exercise lease termination > Record contractual return | Asset events section | Not a modification |
EOT option and RCHP changes
| Scenario | Record Event path | Key sections | Special note |
|---|---|---|---|
| Adding renewal options | Record contract modification > Change reasonably certain option | Configure EOT options; Step 4 Summary; Classify & Book | - |
| Changing non-RC option to RC (RCHP change required, not exercising) | Record contract modification > Change reasonably certain option | Configure EOT options (check RC box); Step 4 Summary (RCHP); Classify & Book | - |
| Changing RC option (e.g., Return to Buyout) | Record contract modification > Change reasonably certain option | Configure EOT options; Step 4 Summary (RCHP); Classify & Book | - |
| Early termination: RCHP change required, not exercising | Record contract modification > Change reasonably certain option | Configure EOT options; Step 4 Summary (RCHP); Classify & Book | - |
| Renewal ready to be exercised | Record Asset Event > Exercise lease renewal/extension > Record contractual renewal | Asset events section | Not a modification |
Special cases
| Scenario | Record Event path | Key sections | Special note |
|---|---|---|---|
| Change in useful economic life | Record contract modification > Record contract renegotiation | No term changes; Configure EOT options; Step 4 Summary; Override at classification | Override + Override Explanation required |
| Reduce lease term: change in classification (Finance to Operating) | Record contract modification > Record reduction in term | Verify payments (reduce); Configure EOT options; Step 4 Summary; Override at classification | Override + Override Explanation required |
| Changing to RC buyout mid-term | Record contract modification > Change reasonably certain option | Configure EOT options (Buyout with RC checkbox); Step 4 Summary (RCHP); Classify & Book | - |
| Change in Residual Value Guarantee (EGRV) | Record contract modification > Record contract renegotiation | Configure EOT options; Step 4 Summary (EGRV field); Classify & Book | EGRV entered in Step 4 Summary: After Modification card |
| Full asset impairment (continuing payments on vacated asset) | Record Asset Event > Impair an asset | Asset events section | Not a modification |