Calculating and viewing commitments

Core TSIs : Lease Accounting : Working with lease accounting : Calculating and viewing commitments

Contract lines generate financial commitments in Planon. In Contracts, go to Contracts > Contract line details > Financial commitments to view the financial commitments.

Financial commitments are always related to payments or revenues. Based on the agreements made on amounts, payment frequency and commitment periods, Planon calculates the corresponding commitments and the dates at which these should be paid / received. For more information on financial commitments and on working with contracts in Planon, see Contracts.

For lease contract lines, Planon calculates accounting commitments. In Contracts, go to Contracts > Contract line details > Accounting commitments to view the accounting commitments.

Those amounts are registered in the P&L (Profit and Loss) statements and reported on the balance sheet representing the liability and right of use.

Financial commitments and accounting commitments generate postings in Planon for journal entries in your financial system. For more information, see Generating postings.

The Contract line commitments system report shows the financial and accounting commitments for contract lines based on lease accounting. For more information on this report, see Reporting in Lease accounting.

Before you start calculating lease accounting commitments, you should first set the Year end date set by Planon option of the Financial years business object in Field definer to Yes. Planon will then determine the end date of a financial year.
For more information on this setting, see Field definer .

If you switch an option (renewal/ termination/purchase) from 'not reasonably certain' to 'reasonably certain' or vice versa, the corresponding commitments will be adjusted accordingly. Planon automatically removes or adds commitments when the Is reasonably certain? setting is changed.
• For an additional 'reasonably certain' renewal option: Planon adds commitments in accordance with the added renewal period.
• For an additional 'reasonably certain' termination or purchase option: Planon removes commitments up to the proposed end date of the termination option / purchase option.