January 8, 2019
Leasepoint is a powerful and flexible tool for enhancing an aircraft lessor’s operations, offering robust features that can unlock untapped potential to enable your business to perform at the highest levels in the industry. However, to deploy Leasepoint in a way that effectively supports treasury, accounting, banking, and contract management activities, lessors need to engage a trusted technology partner who has the in-depth knowledge of the daily workings of an aircraft leasing platform and can deliver a tailored, customer-focused, and nimble approach to the system’s optimization.
With the increasing complexity of aircraft financings, the volume of payments, and the rapidly accelerating growth of corporate structures among a significant number of asset-owning leasing companies, Leasepoint has become one of the premier ‘go-to’ systems for facilitating day-to-day contracts and asset management operations.
A successful implementation of Leasepoint or the enhancement of an existing system requires a trusted technology partner who has the in-depth knowledge of the daily workings of an aircraft leasing platform and can deliver a tailored, customer-focused, and nimble approach to the implementation.
Having done so for globally recognized lessors, Zeevo Group (“Zeevo”) has in-depth experience in optimizing Leasepoint and assisting companies in deploying a full suite of enhancements.
Zeevo Group Director Angela Geremia explains: “Leasepoint, when set up to reach its full potential, is a powerful tool to automate business procedures, relieving administrative burdens and supporting your organization’s growth into a global top-tier aircraft leasing business.”
Whether first implementing Leasepoint or optimizing an existing system, a roadmap is key to limit disruption in operations and identify dependencies between each dataset within the system.
In project planning there are eight essential building blocks to consider: security configuration; company data and bank information; asset and component information; lease contract setup; maintenance programs; general ledger integration; technical specifications; and reporting.
To protect the integrity of your Leasepoint data, it is important to control the users who can view, enter, revise, and approve it in the system.
There are many available security roles available for flexible configuration of appropriate user access rights. Developing regularly scheduled audits help maintain your data quality over time. The Diary module and Review Profile feature sets support this quality control.
To start, your Company Register should be up-to-date with your:
- Active internal lessor companies;
- Existing and potential lessees;
- Asset manufacturers;
- Part suppliers;
- Insurance companies and brokers; and
- Asset owner companies including banks and other leasing companies.
These company details are used in multiple system features such as contract setup and invoicing that facilitate automated operations – minimizing the need for routine manual tasks and reducing administrative overheard.
Along with the company setup, updating your bank branch and account details further enables the system’s automated feature set, such as invoicing based on payment schedules. Each payment schedule requires a defined corresponding payment bank account. The selected account is used to output any required wire details on an invoice and to record the bank account transaction when a customer makes a payment.
ASSET AND COMPONENT INFORMATION
Remediating your asset and component data can be done in parallel to the cleansing of company and bank account records. First, make sure to set up the required technical master data – i.e. the technical details of the major components that drive financial decisions and asset management.
At minimum, ensure the following component variant types are captured correctly to encompass all variants for both your current fleet and future on-order aircraft, including airframe, engine, landing gear, and APU.
The granularity of technical master data to remediate should be dictated by your business requirements and available resources to track the data in the system on a go-forward basis. For example, you can track each life limited part (LLP) for every engine or just the limiter.
Geremia contends: “At the onset, do a cost-benefit analysis of available resources to track your data against the value that data brings to your business requirements.”
LEASE AND CONTRACT SET UP
With the basic company, bank account, asset, and component data remediated, you can then tackle lease agreement data. In Leasepoint, the lease agreement structure encapsulates a parent contract summary and a child payment schedule for each applicable payment type, e.g., rent, maintenance reserves.
The contract summary details include, but are not limited to:
- Parties to the lease, e.g., the lessor company, lessee, and bank;
- Lease term details, e.g., term length;
- Lease option details, e.g., extension and early termination options;
- Scheduled events, e.g., mid-term audits, expiry dates; and
- Return conditions.
For each type of payment schedule, there is a corresponding child contract summary with their own unique parameters. Typical payment schedule contracts include operating lease payments, e.g., rent, security deposit payments, and maintenance reserve payments and funds.
Most types are supported by a payment schedule calculation engine, which should be relied upon over using an existing override feature. The system also allows additional linked fee or payment schedules to invoice any management fees.
MAINTENANCE RESERVE PAYMENT SCHEDULES
The scope of legacy maintenance reserves (“MR”) transactions you want to capture dictates the requisite effort to set up MR payment schedules. For example, to arrive at the correct, current fund balance you can (a) re-create the entire MR transaction history or (b) only set an initial fund balance as of a specific point of time, configuring your charge and escalation parameters to calculate the amounts going forward.
MAINTENANCE PROGRAMS (INTERVALS AND COSTS)
Setting up maintenance programs, e.g., engine performance restorations, airframe heavy checks, using the requisite interval and cost estimates available enables:
- More robust shop visit and maintenance event tracking;
- Further evaluation analysis of assets;
- Maintenance forecasting; and
- Better insight when processing reserve claims.
Once set up, the system can be configured to automatically calculate the expected next event date and associated costs for each component.
GENERAL LEDGER INTERGRATION
Leasepoint can be configured as a complete sub-ledger and integrated with different general ledger solutions. To do so:
- Define your chart of accounts;
- Setup your general ledger profiles;
- Assign each profile to the applicable payment schedules; and
- Lastly, configure the journal export file for posting to your general ledger.
Multiple technical specifications can be created for an aircraft that your Marketing Department can use for remarketing purposes. Technical specifications in Leasepoint can be very detailed – covering everything from weights, fuel, and cabin configuration to avionics and modifications. Accordingly define the essential data elements needed to remarket an aircraft up-front.
Leasepoint has an extensive list of delivered reports. Performing a review of the available reports will help you determine any reporting gaps. Where gaps exist, Leasepoint can be complemented with more advanced third-party reporting and business intelligence technologies.
WE CAN HELP
With their wide-ranging experience in the aviation industry coupled with their Leasepoint expertise, Zeevo is ready to help your company. To learn about the full spectrum of Zeevo’s technology, finance, operational improvement solutions, visit our new website: zeevogroup.com. Our team of industry experts are on standby to assist your leasing platform to define a project roadmap, implement or enhance the system, spearhead data remediation, and develop custom reporting solutions to get you the most value out of your Leasepoint. So, when do you want to get started?
Disclaimer: This is an independent article and has not been authorized, sponsored, or otherwise approved by AMT-SYBEX. Leasepoint is a trademark of Capita plc, registered in the U.K. and other countries.
About Zeevo Group LLC:
Zeevo Group LLC (“Zeevo”) provides business, finance and information technology consulting services and products to a broad range of clients representing such key industries as aircraft leasing, technology and consumer products. www.zeevogroup.com
Direct: +1 760 933 8607