The quick answer
Open the lease, click Edit, and on the Lease Amortization Schedule subtab enter the first payment's Start Date and the payment Amount. Click Generate Payments, then Save. NetSuite calculates each payment's present value and splits it into interest and principal. Click Create Lease Journal to post the right-of-use asset and lease liability for the total net present value. Then run Fixed Assets > Transactions > Asset Proposal for that journal and Generate Assets from Manage Asset Proposal. The lease ends in Asset Created status, and Record Lease Interest posts the monthly interest from there. Depreciation of the new asset runs separately.
The screenshots show sample data. Person and operating-company names are fictional. Use your own records and values when following the steps.
Before you start
This example is an operating lease for a refrigerated forklift fleet: Lease 22 with Crestline Equipment Leasing, contract CEL-4471-R, 24 monthly payments of 2,400.00 at a 6.0% annual rate, running from 07/01/2026 to 06/30/2028. The lease is already saved with its terms, so it's sitting in Pending Lease Payments status with nothing on its schedule.
You need the Fixed Asset Management SuiteApp with leases, the Custom Transactions feature, and a role that can edit leases and run FAM processes (Administrator works). The lease's Posting Reference subtab needs a Right-of-Use Asset account and a Lease Liability account. There also has to be a FAM asset type set up for operating leases whose asset account is that same right-of-use account, with its depreciation defaults and accumulated depreciation account filled in and available to the lease's subsidiary. That match is what lets Asset Proposal find the lease journal later. The posting periods you'll post into must be open, and any department, class or location your account requires on journals has to be filled in. Exact permissions vary by role and account; the Administrator role was used here.
Menu paths below are the ones in the account used for this example. If a page isn't where it says, search for its name in global search.
01. Open the lease that is waiting for payments
Go to Fixed Assets > Leases > Lease > List and click View on the row with Document Number 22. The status next to the number is Pending Lease Payments. The terms are saved: Rental Frequency Monthly, Lease Term 24, Annual Interest Rate 6.0%, Lease Start Date 07/01/2026 and Lease End Date 06/30/2028. Transaction, Asset Proposal and Asset are blank.
Open the Lease Amortization Schedule subtab. It has no rows, and every Lease Summary total is 0.00. That's why the lease is still pending.
Check the Posting Reference subtab too. Right-of-Use Asset is 1485 Right-of-Use Asset - Equipment and Lease Liability is 2710 Lease Liability - Operating. The lease journal will use these two accounts.
02. Generate the payments and save
Click Edit and open the Lease Amortization Schedule subtab. Enter Start Date 07/01/2026, the date of the first payment, and Amount 2,400.00, the monthly payment. Click Generate Payments. A message says the payments are being generated; click OK.
Twenty-four rows appear, one a month from 07/01/2026 to 06/01/2028, each for 2,400.00. In this workflow Net Present Value, Balance, Interest and Principal stay empty until you save.
Click Save. The status changes to Pending Lease Journal Creation and the schedule is calculated. The first payment falls on the lease start date, so this schedule treats payments as made in advance, at the annual rate divided by 12, 0.5% a month here:
- Row 07/01/2026: Net Present Value 2,400.00, Interest 0.00, Principal 2,400.00, Balance 52,021.64. The first payment is made on day one, so nothing is discounted and no interest has built up.
- Row 08/01/2026: Net Present Value 2,388.06 (2,400.00 / 1.005) and Interest 260.11 (52,021.64 × 0.005), leaving Principal 2,139.89.
The Lease Summary now shows Total Lease Payment 57,600.00, Total NPV 54,421.64, Total Lease Liability 54,421.64, Total Interest 3,178.36 and Total Principal 54,421.64. The liability is the present value of the payments, not their sum, and the 3,178.36 of interest is the difference between the two.
03. Create the lease journal
With the lease in Pending Lease Journal Creation, a Create Lease Journal button sits next to Edit and Back. Click it. The confirmation shows the journal amount, 54421.64, which for this lease is the Total NPV. Click OK.
The status changes to Journal Created, and the Transaction field links Journal #JE318.
Click the link. In this example the journal is dated 07/01/2026, the lease start date, in posting period Jul 2026, for subsidiary Example Supply Co. : Tidewater East. It has two lines: Dr 1485 Right-of-Use Asset - Equipment 54,421.64 and Cr 2710 Lease Liability - Operating 54,421.64. Both carry the memo Refrigerated Forklift Fleet, and the credit line names Crestline Equipment Leasing. If your account requires journal approval, approve it before the next step. Asset Proposal won't pick up a journal that is still pending approval.
04. Propose the lease asset
Go to Fixed Assets > Transactions > Asset Proposal. Set Date Range to Custom with Start Date 07/01/2026 and End Date 07/31/2026, a range that includes the journal date. In Subsidiary, select Example Supply Co. : Tidewater East. In the Asset Types sublist, pick Right-of-Use - Equipment and click Add. The row shows Operating Lease Yes and Account Name Right-of-Use Asset - Equipment, the account the lease journal debited.
The date range filters the source transaction's date. The journal also has to be posted, belong to the selected subsidiary and not have been proposed before. In an account without OneWorld there is no Subsidiary field.
Click Propose New Assets. FAM Process Status opens with an Asset Proposal process that's Queued. Click Refresh until it's Completed, then click Details. Here the Propose Assets stage shows Assets proposed: 1, and the lease moves to Asset Proposed. You'll see that change on the lease later.
05. Generate the asset
Go to Fixed Assets > Transactions > Manage Asset Proposal. The page is titled Manage Proposals. Find proposal 537: Transaction Journal #JE318, Asset Type Right-of-Use - Equipment, Description Refrigerated Forklift Fleet, Original Cost 54,421.64, Residual Value 0.00 and Asset Lifetime 24. Check its Select box. Leave proposal 529 alone; it belongs to a different transaction.
Click Generate Assets. FAM Process Status shows an Asset Generation process. Click Refresh until it's Completed. Its Details show the Generate Assets stage with Assets generated: 1.
06. Confirm the lease asset
Go back to the lease: Fixed Assets > Leases > Lease > List, then View on Lease 22. The status is Asset Created. Transaction links Journal #JE318, Asset Proposal links 537, and Asset links FAM000093 Refrigerated Forklift Fleet.
Check the result
- The lease status is Asset Created.
- Total NPV and Total Lease Liability are both 54,421.64.
- The Transaction, Asset Proposal and Asset fields are all linked.
- The FAM asset has Asset Original Cost 54,421.64 and Asset Is Leased checked.
The System Information subtab lists each status change: Pending Lease Payments to Pending Lease Journal Creation when you saved, then Journal Created, Asset Proposed and Asset Created.
Click the Asset link. FAM asset FAM000093 has Asset Type Right-of-Use - Equipment, Asset Original Cost 54,421.64 and Asset Lifetime 24, and Asset Is Leased is checked. NetSuite sets that checkbox when it generates the asset from a lease proposal. The acquisition was already posted by the lease journal, so generating the asset doesn't post it again. Depreciating the asset is a separate FAM process and posts on its own.
07. Record lease interest
Go to Fixed Assets > Leases > Record Lease Interest. Enter Date 09/30/2026 and select Example Supply Co. : Tidewater East in Subsidiaries. Click Record Interest.
FAM Process Status shows a Recognize Lease Interest process. Click Refresh until it's Completed. Its Details show the Recognize Lease Interests stage with Journals created: 2.
Open Lease 22 again and go to the Lease Amortization Schedule subtab. The 08/01/2026 row, interest 260.11, now links Journal #JE326 in the Journal Entry column, and the 09/01/2026 row, interest 249.41, links Journal #JE327. The 07/01/2026 row has no journal because its interest is 0.00. The 10/01/2026 row and later come after 09/30/2026, so they're picked up the next time you record interest. Record Lease Interest takes every row with interest on or before the date that doesn't have a journal yet, so a later date can create several journals at once.
For an operating lease the interest entry generally debits Accumulated Depreciation - Right-of-Use Asset and credits Lease Liability. For a finance lease it debits Interest Expense and credits Lease Liability. Open one of the journals to confirm the accounts your account uses, and approve the journals if your account holds them for approval. Record Lease Interest doesn't record the cash you pay the lessor; bills and payments to Crestline Equipment Leasing go through accounts payable as usual.
Common questions
Why are Net Present Value and Interest empty after I click Generate Payments?
Generate Payments only creates the payment rows: a date and an amount for each period. The present value, balance, interest and principal are calculated when you save the lease. If they're still empty after Save, check that every row has a date and an amount and that Rental Frequency, Lease Term and Annual Interest Rate are filled in.
Why is the lease liability lower than the total of the payments?
The liability is the present value of the payments, not their sum. Here, 24 payments of 2,400.00 add up to 57,600.00, and discounting them at 6.0% a year gives a Total NPV and Total Lease Liability of 54,421.64. The 3,178.36 difference is the interest that gets recognized over the lease term.
Why doesn't my lease journal show up in Asset Proposal?
Asset Proposal only finds journals that are posted, fall inside the date range, belong to the selected subsidiary and haven't been proposed before. The asset type you add also has to use the same asset account as the lease's right-of-use account. If journal approval is on, approve the lease journal first.
Why does the first row of the lease schedule have no interest?
When the first payment falls on the lease start date, it's paid before any time has passed, so nothing has accrued on it. That's why the first row shows 0.00 interest and a present value equal to the payment. Interest starts on the second row. A lease whose payments fall at the end of each period would calculate differently.
What does Record Lease Interest post?
It creates a journal for each schedule row dated on or before the date you enter that has interest and no journal yet, and links it on that row. For an operating lease the entry generally debits Accumulated Depreciation - Right-of-Use Asset and credits Lease Liability. For a finance lease it debits Interest Expense and credits Lease Liability. It doesn't record the cash you pay the lessor.