Types of Leases in Oracle FLA
There are different types of leases that we can record in the Oracle FLA(Fusion Lease Accounting) module. FLA is a separate module under Finance suit which is used to manage leases. Oracle Lease Accounting has the key features of lease creation, generating amortization schedules, and maintaining accounting balances. It generates the balances required as specified by IFRS16 and ASC842 guidelines. ASC842 is nothing but US GAAP and IFRS16 is international GAAP. A lease is a contract where a party (the lessee) gains the right to use an asset owned by another party (the lessor) for a specific period. Here we have two parties. Lessor: The owner of the asset who grants the use of the asset. Lessee: The party who uses the asset and makes payments to the lessor. There are two types of Leases. Expense Lease An "expense lease" refers to the cost recorded by a lessee for using an asset that is not owned but rather leased. An expense lease...