HOW TO: Create Supplier Contract Amendment – Payment Change

Process Steps:

1. Open Supplier Contract

2. From Related Actions select Create Lease Amendment

3. Select one of the Contract Amendment Types a. Payment Change

4. Enter Amendment Signed Date a. Will be the Accounting Date for the Operational Journal i. Must be in open period ii. Cannot be dated in the same Fiscal Period as the Supplier Contract Start Date iii. Cannot be dated before a previous lease amendment iv. Cannot be in the same period as a previous lease amendment v. Cannot be future dated

5. Enter Lease Liability Reassessment Date

6. Enter Payment Effective Date

7. Enter Amendment Description

8. Enter Amendment Number

9. Click OK then Done

10. For Variable Payment Contracts a. Lease Details i. Update the Interest Rate, if necessary b. On the Payment Information Tab: i. Enter the Payment Dates and Amount for each installment c. Header i. Update the Total Contract Amount

11. For Fixed Payment contracts a. Lease Details i. Update the Fixed Payment Amount (required) ii. Update the Interest Rate, if necessary b. Header i. Update the Total Contract Amount

1. Amount must be equal to or greater that the Total Lease Payments amount

12. Upload Attachments

13. Click Submit

Supplier Invoices for Lease Contracts

Lease accounting in Workday automatically generates the Supplier Invoice Schedule and Expense Recognition Schedule from supplier contracts. This process facilitates in providing accurate financial data calculations and tracking for financial reporting and compliance.

Supplier Invoice Schedule cannot be modified. If there is an error in the schedule you must cancel the contract and create a new contract.

Validations - Lease related Supplier Invoices

Critical:

• Capital Asset spend categories cannot be used on lease related transaction.

• Intercompany transactions are not allowed for Lease Contract related invoices.

• Lease Spend Category can only be used with a Supplier Lease Contract.

• Lines with Short Term Lease Spend Categories must be created from Purchase Orders or Supplier Contracts.

• Location is required on Lease Contract Payments.

• Spend Category 45.000570 and 45.000560 can only be used for Lease tax purposes.

HOW TO: Generate Supplier Invoice from Supplier Invoice Installment Schedule

When Supplier Contracts are Fully Approved a Supplier Invoice Installment Schedule is automatically created to facilitate processing of Supplier Invoices. Supplier Invoices cannot be created manually, rather they will need to be created from the installment schedules based on the billing frequency (Monthly, Quarterly, Annually).

The Supplier Invoice Schedule can be viewed from the Contract on the Schedules tab.

• Schedule Information will reflect the supplier and remit to connection from the contract.

• Generate Installment Information illustrates billing frequency and dates for supplier invoices as well as all Lease terms.

Process Steps:

1. Open Supplier Contract.

2. Move to Schedules tab.

3. Open the Schedule for “Supplier Invoices”

4. Select related action from the Installment

5. Select > Supplier Invoice Installment > Create Supplier Invoice

6. Review the Confirmation details a. Auto Submit is automatically selected. i. If Non-Lease components (ex. usage, CAM, or utilities) or sales tax will be paid, uncheck the Auto Submit checkbox. See step 12 below. ii. If Auto Submit is selected, the system will attempt to Submit into the business process. iii. Supplier Invoice will be left in ‘Draft’ status if there are any outstanding exceptions on the Supplier Invoice. These will need to be monitored by Departments. iv. If the associated contract line is not marked as Nontaxable, a Supplier Invoice automatically submitted will err and go to Draft status. b. All other installment defaults i. Information is pulled from the Supplier Contract. If any of these values are not correct you will need to manage the change on the Supplier Contract.

7. Select OK button

8. Process for Create Supplier Invoice from Supplier Contract will be displayed

9. Select Refresh button a. If not ‘In Progress”, edit Supplier Invoice as necessary.

10. Open Supplier Invoice to verify status is In Progress OR Review Installment Schedule to verify status.

11. If there are non-lease components or taxes to be paid, add ad hoc line(s) to record the additional spend (costs).

You can create multiple Supplier Invoices from the Installment Schedule using the Create Supplier Invoices for Supplier Contract Installment Task.

1. Access the Create Supplier Invoices for Supplier Contract Installment a. Enter criteria to find supplier installments b. Select the installment(s) c. Click OK d. Review Confirmation e. Click OK f. Click Refresh g. Go to step 7 above

HOW TO: Manage Sales Tax on Lease Contract Supplier Invoices

Lease payment Lines cannot be marked as Taxable. In order to identify that tax is being included and paid it must be entered as a separate line that does not contain the reference to the supplier contract.

Process Steps:

1. Open Supplier Invoice created from Supplier Invoice Installment Schedule

2. Add additional Line to record Sales Tax Amount a. Enter Spend Category i. Must be Long Term Lease Equipment Sales Tax [45.000570] b. Tax Applicability i. Must be Nontaxable c. Extended Amount i. Enter sales tax amount d. Memo i. Enter the SC Number e. All worktags need to be the same as the original line (Cost Center, Fund, Business Unit, Location)

3. Add additional lines, if necessary.

4. Click Submit.

HOW TO: Manage Use Tax on Lease Contract Supplier Invoices

Process Steps:

1. Open Supplier Invoice created from Supplier Invoice Installment Schedule

2. Add 2 additional Lines for recording Use Tax Amount a. Add 1st Line for the Use Tax i. Assign Spend Category: Use Tax Payable [229510] ii. This line needs to be Nontaxable iii. The Extended amount needs to be the Use Tax amount and must be negative iv. Enter the Supplier Contract number in the Memo field v. All worktags need to be the same as the original line (Cost Center, Fund, Business Unit, Location) b. Add 2nd Line for the Offset for Use Tax Payable i. Assign a Spend Category specific to Use Tax for Lease Contracts: Long Term Lease Equipment Use Tax [45.000560] ii. Tax Applicability field: Enter Nontaxable iii. The Extended amount needs to be the Use Tax amount iv. Enter the Supplier Contract number in the Memo field v. All worktags need to be the same as the original line (Cost Center, Fund, Business Unit, Location)

3. Add additional lines, if necessary.

4. Click Submit.

HOW TO: Enter Non-Lease Component on Supplier Contract Invoices

Process Steps:

1. Open Supplier invoice created from Supplier Invoice Installment Schedule a. Enter Line Number b. Enter Spend Category i. Electricity 47.0002 ii. Water 47.0003 iii. Long Term Lease Termination Penalties [45.000580] iv. Long Term Lease Usage Costs [45.000585] v. Long Term Lease Initial Direct Costs [45.000590] vi. Lease Operating Expense Recovery/Common Area Maintenance [45.000595] vii. Additional Spend Categories will be added in order to track lease related expenses c. Tax Applicability i. Choose Non-Taxable or Taxable d. Extended Amount i. Enter amount of non-lease component ii. Enter all applicable worktags: Cost Center, Fund (same as original line) and Business Unit (non-591xxx). Optional worktags: Project and Program. e. Memo i. Enter the SC Number ii. Enter comment stating what the expense is

2. Add additional Line for recording non lease component. If you have more than one non-lease component, add a line for each.

3. Add additional lines, if necessary.

4. Click Submit.

Supplier Invoice Adjustments

The following fields can be modified via a Supplier Invoice adjustment on the Supplier Invoice line associated with a lease contract.

• Ship-To

• Tax Applicability

• Tax Code

• Withholding Tx Code

• Memo

All fields on an Ad Hoc line related to a lease supplier contract may be modified.

Validations - Lease related Supplier Invoice Adjustment

Critical:

• Capital Asset spend categories cannot be used on lease related transactions.

• Intercompany not allowed for lease payments.

• Lease Spend Category can only be used with a Supplier Lease Contract

• Lines with Short Term Lease Spend Categories must be created from Purchase Orders or Supplier Contracts

Expense Recognition Accounting (Interest) for Lease Contracts

Lease accounting in Workday automatically generates the Supplier Invoice Schedule and Expense Recognition Schedule from supplier contracts. This process facilitates in providing accurate financial data calculations and tracking for financial reporting and compliance.

Expense Recognition Schedule cannot be modified. If there is an error in the schedule you must cancel the contract and create a new contract.

HOW TO: Generate Interest Acctg from Expense Recognition Installment Schedule

When Supplier Contracts are Fully Approved an Expense Recognition Installment Schedule is automatically created to facilitate accounting to post interest expense. Expense recognition interest cannot be created manually. It is created from the installment schedules and posted monthly.

The Expense Recognition Schedule can be viewed from the Contract on the Schedules tab.

To create Expense Recognition Accounting for a single schedule:

Process Steps:

1. Open Supplier Contract.

2. Move to Schedules tab.

3. Open the Schedule for “Expense Recognition”

4. Select related action from the Installment

Installment schedules are not available when an amendment is in process.

5. Select > Expense Recognition Installment > Create Expense Recognition Accounting

6. Click OK

View Accounting from Installment related actions > Expense Recognition Installment > View Accounting, verify Status “Posted” OR Review Installment Schedule to verify status “Complete”.

You can generate Expense Recognition Accounting for multiple schedules using the Create Expense Recognition Accounting Task.

1. Access Create Expense Recognition Accounting Task a. Enter criteria to find available installments b. Select the Expense Recognition Installments c. Click OK d. Review Confirmation e. Click OK f. Go to step 7 above

Asset Disposals

When a contract reaches the end of term, an Asset Disposal should be initiated. The only Disposal Method allowed for a lease related asset is “Lease Terminated”. If a Disposal method other than “Lease Terminated” is selected, the disposal event will not be able to fully be processed and will remain in initiator’s Workday inbox. The disposal event process will need to be canceled and a new disposal must be created.

Validations for Lease Asset Disposals

Critical:

• Disposal Type of Lease Terminated can only be used for Assets from Supplier Lease Contracts

• Disposal Worktags must match Asset Worktags. If needed a Transfer can be completed before Disposal to update Worktags if Asset is not related to a Lease Contract.

HOW TO: Lease Accounting Asset Disposal

Assets related to a Lease contract cannot be Removed, they may only be Disposed. Assets related to a Lease contract can be Disposed of when the contract has been canceled or when a contract has expired.

Process Steps

1. Search ASSET-XXXXX a. If contract term end date reason for disposal, include in comment box contract SC-xxxxx ended, term period end date xx/xx/xxxx. b. If contract canceled early, attach documentation for early cancelation.

2. Attach supporting disposal documentation to Asset if reason for disposal is other than contract term end date.

3. Process Disposal a. Related Actions > Business Asset > Dispose

4. Enter Information a. Transaction Effective Date is the first day of the next month the contract is active. It should be dated for the next month after the term period end date in comment section, step c below. i. If at end of contract, it is next month after the contract end date ii. If contract ended early, it is the next month after the contract is active/asset able to be used. iii. Depreciation will not post accurately if processed in same month as the contract end date. DISPOSAL EVENT WILL NEED TO BE CANCELED AND REENTERED IF INCORRECT DATE USED. b. Disposal Type i. MUST BE Lease Terminated c. Add Comment i. If contract term end date reason for disposal, include in comment box contract SC-xxxxx ended, term period end date xx/xx/xxxx, disposal effective date is the following month. ii. If contract canceled early, include contract SC-xxxxx ended and why canceled early with contract end date.

5. Disposal Fair Market Value a. Leave blank

6. Sales Prices: a. Leave Blank

7. Percent to Dispose/Cost to Dispose a. Leave at default value

8. Click Submit

HOW TO: Cancel a Lease Related Asset

If an Asset Disposal or Removal Event has a Status of Error, Denied, or was submitted with a field that is not allowed, you must cancel the event.

Process Steps

1. Open the Asset

2. Click on the Process History tab

3. Go to the last event of the Process

4. Click on Related Actions for the Asset Disposal Event Or Asset Removal Event, as applicable

5. For a Denial a. Click on Business Process > Delete

6. For an erroneous entry a. Click on Business Process > Cancel

7. Enter a Comment, if required

8. Click Submit

Contract Cancellations

Once fully executed, canceling a Lease Contract has substantial trick-down effect.

Cancelations cannot be future dated to leave installments available or back dated to reverse installments that have been processed. Once a contract cancellation has been initiated the status of unused installments will change from available to canceled.

Department Responsibilities

1. Verify the last Installment and Expense Recognition Schedule match. Central Accounting Responsibilities

1. Manual Journals to move accounting.

HOW TO: Re-enter a Previously Approved Lease

This procedure should be followed when a lease agreement has a simple data entry error. If the error results in a contract increase that causes the contract total to exceed $250,000, it will need to go through the full BP. Follow the How To for the appropriate contract type.

There are two instances here the ‘copy’ function may not be available. If the contract type is ‘Variable’ and the dates were entered incorrectly, you will have to create a new contract using the Create Supplier Contract task. Second, if a contract that has been amended, you will not have the option to copy it.

Process Steps:

1. Locate the contract to be copied

2. Related Actions > Supplier Contract > Copy

3. Verify that you’ve selected the correct contract to copy.

4. Click OK

5. Enter Contract Name a. This should be the same name as the version you’ve copied unless the contract name was incorrect

6. Enter original contract previously approve in Contract Reference field

7. Enter the Supplier Invoice Reference Number

8. Make corrections

9. Add Attachments a. Include all attachment from the copied contract. Additional attachments may be added.

10. Enter a Comment explaining why the new contract is required.

11. Click Save for Later a. NOTE: If you click Submit you will have to restart this process.

12. Contract PCPURCHASING to request the contract be processed.

Reports

Find Supplier Lease Contracts with Assets FIN1030

Find Available Supplier Contract Installments FIN1080

Lease Assets to Review for Disposal FIN0910

Find Available Expense Recognition Schedules FIN1081

Find Supplier Contracts FIN0549

Find Supplier Contract Amendments FIN0891

Find Supplier Contract Lines FIN0636

Find Supplier Invoice FIN0342

Business Unit Setup FIN0580

Asset Inventory Depreciation Summary FIN0387