How to handle security deposit when 1 tenant leaves & 1 stays?

[Gabriel B.]

The lease term will be ending in 60 days for two tenants.  One tenant has provided ample notice that she will be leaving.  The other tenant, however, indicated they want to stay.  How would you handle security deposit in this situation?  

My thoughts were to conduct a move-out inspection at the end of the lease term and return security deposits to both tenants.  Thereafter, I would create a new lease agreement with current tenant provided she finds a new roommate.  

What are your suggestions?