FX for Lessor

Overview

EZLease's FX (foreign exchange) feature enables users to manage leases across different currencies and generate financial reports in the currency format that best suits business needs. This feature provides flexibility for international leases, global operations consolidation, and diverse regulatory requirements.

EZLease supports financial reports in three currency types:

• Reporting currency - The currency in which a company presents its financial statements (For example, a U.S. parent reports in USD).
• Functional currency - The currency of the primary economic environment where an entity operates (For example, a German subsidiary's day-to-day business in EUR).
• Transactional currency (Lease currency) - The currency in which an individual transaction is denominated (For example, a lease contract signed in GBP).

Note: This feature is not available at all EZLease license levels. Please contact Account Executive directly or reach out here if this feature is not visible in EZLease.

Setting Up FX

Before using EZLease's FX capabilities, users must enable and configure FX settings, load rates, load entities, and ensure each lease has a transactional currency defined.

Enable and Configure FX

Step 1: Log into EZLease and open the lease management workspace by clicking the "Manage my Leases" button in the upper right corner of the dashboard page. EZLease will open a new tab in the web browser.

Step 2: Navigate to File > System Options and select the "Foreign Exchange (FX)" tab.

Step 3: Check the "Enable FX reporting" checkbox.

Step 4: Configure convenience options:

• Default Lease Currency and Entity - When adding a new lease directly in EZLease (not via bulk import), EZLease will initially select this currency and entity. Users should set this to the most frequently used currency and entity.
• Default Currency Type - When creating a report, users can choose to generate the report in transactional, functional, or reporting currency. Users should set this to the currency type most often used for report generation.

Step 5: Set the Reporting Currency - The reporting currency is the primary currency a company uses to present its financial statements. EZLease allows users to select a single reporting currency. When running a report in reporting currency, EZLease converts all financial data to the reporting currency.

Step 6: Set the Average Rate - A month-end average rate is the average of daily exchange rates over the month, used to translate income and expenses from foreign currencies into the reporting currency. This rate smooths out daily fluctuations and provides a more consistent measure than using only the spot rate on the last day of the month. Two options are available:

• Table - Users upload month-end average rates, and the system utilizes those rates to perform calculations.
• Calculated - The system calculates the average rate using one of three methods:
  • Prior - Prior month spot rates serve as the current month average rate.
  • Simple - Average of prior month spot and current month spot.
  • Current - Current month spot rates serve as the current month average rate.

If FX is disabled, EZLease retains all FX data in the system so FX can be easily re-enabled in the future if needed.

An entity table displays at the bottom of the page to provide a complete list of entities in the system. The "Currency Management" tab displays all rates in the system.

Upload Entities

EZLease uses entities to determine the functional currency of a lease rather than assigning a functional currency directly to each lease. Each entity includes an entity code (abbreviation for easy reference), entity name, and assigned currency.

Users load entities in bulk via a spreadsheet. Follow the instructions to load the entities:

Step 1: Navigate to the "Bulk Actions" menu and select the "Lessor" tab.

Step 2: Download the "Entity upload" template by clicking the download icon in the "Action" column.

Step 3: Fill in the template with a complete list of entities. All three columns must be completed for each entity: Entity code, Currency, and Entity Name. Ensure the entity currency follows the ISO 4217 currency code list.

Note: Once an entity is created, the entity code cannot be updated, but the entity name and currency can be updated.

Update Entity Name or Currency

To update the entity name or currency, fix the data on the import template and upload it again. EZLease will identify the existing entity based on the Entity ID and update the Entity Name and Currency to match the new data.

Delete an Entity

To delete an entity, re-upload the entity and add two dashes (--) to the front of the entity ID.

Note: Note: Users cannot delete an entity if it is being used on a lease.

Good to Know

• Users can mix deletions, updates, and new entities on a single upload.
• Existing entities can remain on the upload, and EZLease will automatically skip duplicates.

Upload FX Rates

FX rates are loaded in bulk via a spreadsheet, similar to loading entities. Follow the instructions to load the FX rates:

Step 1: Navigate to the "Bulk Actions" menu and select the "Lessor" tab.

Step 2: Download the "FX Rates" template by clicking the download icon in the "Action" column.

Step 3: Complete the following fields for each rate:

• Effective Date (MM/DD/YY) - The date from which the loaded rate will be used by EZLease for calculations.
• From Currency - The currency being converted from (follow the ISO 4217 currency code list).
• To Currency - The currency being converted to. This must always be the reporting currency (follow the ISO 4217 currency code list).
• Rate - The conversion rate. Rates can be up to 19 digits with only 12 places after the decimal point.
• Rate Type - Choose either "Spot" or "Weighted Average".
• Source (Optional) - This informational column tracks where rates were sourced from. EZLease does not use this field for any calculations.

Overwrite a Rate

To overwrite a rate, upload a new rate with the matching effective date, from currency, and to currency. EZLease will recognize an existing rate for that date and currency pair and replace it with the new rate.

Delete a Rate

To delete a rate, set the effective date, from currency, and to currency to match the rate to be deleted. Then set the rate amount to 0 and upload the spreadsheet.

Good to Know

• Since the "to currency" should always be the reporting currency, EZLease may not always have an exact currency pair when performing conversion from transactional currency to functional currency. In this case, EZLease converts through the reporting currency (i.e., transactional → reporting, then reporting → functional).
• If a rate has not been loaded for a reporting period, EZLease uses the latest available rate. For example, if the last rate was loaded in June with a June 1st effective date and a report runs for August, EZLease will use the June 1st rate.

Adding and Updating Leases

With FX enabled, users add leases the same way as with FX disabled, except that every lease must be assigned an entity and a lease currency.

Adding New Leases in EZLease

Within the lease management workspace, when adding a new lease, EZLease assigns the entity and lease currency set as the default in "System Options". Users can select a different lease currency from above the "Acct Numbers" tab and a different entity from the "Descriptive" tab.

Loading New Leases via Bulk Import

When loading new leases via the bulk import spreadsheet, users should fill out the Entity and Lease currency columns (AY and AZ) for each lease. If the entity or lease currency is missing, or the data is invalid (For example, the entity entered does not exist), EZLease will automatically reject the lease on upload.

Updating Existing Leases

If leases are already loaded when FX is enabled, users need to update all existing leases with an entity and lease currency. This can be done individually in EZLease by navigating to and editing each lease, or in bulk.

Follow the below steps to load this data in bulk:

Step 1: Download the "Bulk Lease Upload" template from the Bulk Actions page.

Step 2: Fill in the following columns:

• A - Lease Number: Enter the lease number for each lease to be updated. Obtain a list of all leases from EZLease by running the listing report.
• B - Change: Choose "Descriptive" from the change dropdown menu.
• AY - Entity: Enter the entity name.
• AZ - Lease Currency: Enter the lease currency.

Note: If using locking periods and existing leases have activity in closed periods, users need to temporarily disable locking periods from system options when performing this update.

Reporting

When FX is enabled, additional reporting options become available, such as filtering reports by currency and viewing additional columns in some reports.

Most reports can now be created in the following currencies:

• Transactional - Currency assigned to the individual lease.
• Functional - Currency assigned to an entity.
• Reporting - Currency assigned while configuring Foreign Exchange in system options.

A complete list of report availability by currency type appears at the end of this guide.

To generate a report in the preferred currency, select the appropriate "Currency Type" when configuring a report.

Optionally, users can apply filters to report only on leases with a certain transaction currency, functional currency, or entity. For example, users can limit a report to include only leases with a transactional currency of USD by selecting "USD" from the "Transaction currency" selection.

Changes to Reports

EZLease makes the following changes to reports when FX is enabled:

• Journal Entries (JE) Report includes six new columns:
  • Ledger Date: Displays the relevant transaction or accrual date based on payment entry logic.
  • FX Conversion Date: Indicates the date used for FX rate application, following the defined FX logic.
  • Rate Type: Specifies the FX rate type applied (e.g., Spot rate, Average rate).
  • Transaction Currency: The lease transaction currency.
  • Functional Currency: The currency assigned to the lease's entity.
  • Reporting Currency: The system reporting currency
• IS/BS Detail Report includes the following information:
  • Currency (FX) gains and losses for each balance sheet account, including Current Receivable, Long Term Receivable, Accrued Interest, Unguaranteed Residual Asset, and Operating Rent

FAQs

1. Can users change the lease currency and entity on a lease after it has been saved?

Users can only change the lease currency or entity if the lease is booked in an open period. If activity exists in a closed period, users need to terminate and transfer the lease with the new currency or entity.

2. Is there a close process for FX rates?

No, all FX rates can be updated at any time. Anthropic recommends closely restricting access to the "admin" role so that very few people can update rates.

3. Will the system provide warning messages if users run a report for a period where there are no rates, causing the system to use the last available rate?

Users will receive an error if there is no rate back to the start of the lease.

Known Limitations

• Creating reports and loading files from the new web interface may take a minimum of 30 seconds to one minute, with some requests taking longer. This occurs because the system is currently optimized for batch operations (e.g., multi-million lease operations). Performance will improve dramatically in future releases.
• FX functionalities are currently available for Lessor only. FX for Lessee is scheduled for 2026.
• Users can currently change rates and entities even after closing the period. The close functionality will expand to include rates in a future release.
• The Currency Management tab in system options provides view-only access to currency exchange rates loaded into EZLease. This is a read-only feature where rates can be viewed for reference purposes only. Users cannot copy, download, or export the displayed rate information. The ability to export rates and entities will be included in a future release.

FX Conversion Logic

Remeasurement and Translation processes in EZLease use the rules set forth below:

Report List

Below is the list of all reports available in EZLease and the different currencies supported by each report: