NetLease - Run monthly interest payable reclass
Use case: NetLease records transactions on a monthly basis regardless of whether a payment was made. This is done in order to align with the matching principle. For Financing leases, in months where a payment is not made, interest expense will still be recorded within NetLease, and the offsetting interest payable is recorded as an increase (CR) to the Lease Liability account.
As an accounting election, customers may decide they would like to reclass those embedded interest payable amounts from Lease Liability to a separate Interest Payable account. NetLease supports this with the option to run an interest payable reclass.
Prerequisite: All lease transactions that impact the lease subledger details (setup, modifications, impairments, terminations etc.) should be completed prior to processing monthly lease journals. Additionally, the status for commenced leases should be updated to reflect a commenced status. The reclass of interest payable typically also takes place AFTER the amortization entries and ST/LT Liability reclass.
Step-by-step process:
- Open to the Reclass Journal Entry Posting Page by navigating to NetLease > Process Monthly Transactions > Monthly Reclass Journals
- You are navigated to the NetLease Monthly Reclass Journal Processing page. Select "Interest Payable Reclass" as the Reclass Journal Type
Use the checkbox functionality to Run All Months Up To and Including on the Monthly Reclass Journals page for a single run, including backdated reclass journals, instead of processing one period at a time. This applies to short-term/long-term reclass, interest payable reclass, and custom reclass journal types.
- Select the appropriate filters to run the journal entries and select Generate Transactions.
Field | Description | Example |
Period | Select the period for which transactions are to be recorded. | Apr 2026 |
| Reclass Journal Type | The Reclass Journal Type defaults to Short Term/Long Term Reclass. Instead select Interest Payable Reclass from the dropdown. | Interest Payable Reclass |
| Lease Status | Filter by lease status to determine which leases will have reclass journals generated. Except in catch-up scenarios, reclass journals are typically run only for leases with commenced status. | Commenced |
| Run All Months Up To and Including | Checkbox to enable a single run, including backdated reclass journals, instead of processing one period at a time. Applies to short-term/long-term reclass, interest payable reclass, and custom reclass journal types. | Checkbox checked |
Subsidiary | Select the Subsidiary for whom reclass entries will be recorded. Leaving blank will run for all Subsidiaries | Company, Inc. |
| Location | Filter by location to run entries only for the selected location. Leaving this field blank will apply the process to all locations. | San Francisco |
| Lease Type | Filter by lease type to run entries only for the selected lease type. Leaving this field blank will apply the process to all lease types. | Real Estate |
| Lease | Filter for a specific lease to record reclass entries. Leaving this field blank will apply the process to all leases. | LA0033 |
- Refresh the page until the Processing Status indicates Complete and the journal entries are listed in the batch summary
- You can select the Journal Entry link to review the journal entry
- With the reversal entry linked in the Reversal # Field on the main journal entry
- Note that the reclass journal entries are tied to the lease record and can be viewed by navigating back to the lease record and looking at the Other Related Transactions sublist within the Related Records subtab
