This document discusses key elements in developing a strategy for targeting the leasing market, including:
- Parameters for leasing deals such as minimum/maximum terms and transaction amounts
- Prioritizing economic sectors and equipment types to focus on based on the lessor's strategy and capabilities
- Criteria for acceptable lessees such as their sector, growth prospects, and credit history
- Opportunities for vendor relationships through exclusive/non-exclusive agreements that provide benefits like buyback commitments and commissions. The strategy aims to define the scope and focus of a leasing business.
Cummins explains how they transformed their global equipment leasing program to yield significant savings. Cummins explains how they reduced sourcing costs by introducing competitive bidding on lease terms; lowered evergreen payments with better end of term management; and standardized lease vs buy across a global community of stakeholders.
PAETEC\'s ultimate win win proposition. Rather its hardware, furnature, software or almost any other major business purchase, our shared profit program will allow your organization to make that purchase with ZERO cash outlay.
Cummins explains how they transformed their global equipment leasing program to yield significant savings. Cummins explains how they reduced sourcing costs by introducing competitive bidding on lease terms; lowered evergreen payments with better end of term management; and standardized lease vs buy across a global community of stakeholders.
PAETEC\'s ultimate win win proposition. Rather its hardware, furnature, software or almost any other major business purchase, our shared profit program will allow your organization to make that purchase with ZERO cash outlay.
THE IMPACT OF NEW SYSTEM OF SECURED TRANSACTIONS ON RESPECTIVE OPERATIONS OF ...ArmeniaFED
THE IMPACT OF NEW SYSTEM OF SECURED TRANSACTIONS ON RESPECTIVE OPERATIONS OF FINANCIAL INSTITUTIONS
Presented on STR conference organized by USAID FED on April 3, 2015. See details here: http://www.armeniafed.com/str-conference
THE IMPORTANCE OF SECURED TRANSACTIONS FROM THE PERSPECTIVE OF INCREASING THE...ArmeniaFED
THE IMPORTANCE OF SECURED TRANSACTIONS FROM THE PERSPECTIVE OF INCREASING THE ACCESS TO FINANCE
Presented on STR conference organized by USAID FED on April 3, 2015. See details here: http://www.armeniafed.com/str-conference
Ապահովված գործարքների և գրավի ռեգիստրի հայեցակարգըArmeniaFED
Ապահովված գործարքների և գրավի ռեգիստրի հայեցակարգը
Ներկայացվել է 2015թ. ապրիլի 3-ին ԱՄՆ ՄԶԳ Ֆինանսներ Տնտեսության Զարգացման համար ծրագրի կողմից կազմակերպված համաժողովի ժամանակ: Մանրամասնությունները` http://www.armeniafed.com/str-conference
Secured Transactions and Collateral Registries ConceptsArmeniaFED
Secured Transactions Reform (STR) in Armenia.
Presented on STR conference, organized by USAID FED program on April 3, 2015
See details here: http://www.armeniafed.com/str-conference
ԱՊԱՀՈՎՎԱԾ ԳՈՐԾԱՐՔՆԵՐԻ ՀԱՄԱԿԱՐԳԻ ԵՎ ՀԱՄԱՊԱՏԱՍԽԱՆ ՇԱՐԺԱԿԱՆ ԳՈՒՅՔԻ ԷԼԵԿՏՐՈՆԱՅԻՆ ...ArmeniaFED
ԱՊԱՀՈՎՎԱԾ ԳՈՐԾԱՐՔՆԵՐԻ ՀԱՄԱԿԱՐԳԻ ԵՎ ՀԱՄԱՊԱՏԱՍԽԱՆ ՇԱՐԺԱԿԱՆ ԳՈՒՅՔԻ ԷԼԵԿՏՐՈՆԱՅԻՆ ՌԵԳԻՍՏՐԻ ՆԵՐԴՐՈՒՄԸ ՀԱՅԱՍՏԱՆՈՒՄ, ՆԵՐԴՐՎՈՂ ՀԱՄԱԿԱՐԳԻ ՕՐԵՆՍԴՐՈՒԹՅԱՆ ՆԿԱՐԱԳԻՐԸ ԵՎ ԱՌԱՆՁՆԱՀԱՏԿՈՒԹՅՈՒՆՆԵՐԸ
The secret way to sell pi coins effortlessly.DOT TECH
Well as we all know pi isn't launched yet. But you can still sell your pi coins effortlessly because some whales in China are interested in holding massive pi coins. And they are willing to pay good money for it. If you are interested in selling I will leave a contact for you. Just telegram this number below. I sold about 3000 pi coins to him and he paid me immediately.
Telegram: @Pi_vendor_247
What website can I sell pi coins securely.DOT TECH
Currently there are no website or exchange that allow buying or selling of pi coins..
But you can still easily sell pi coins, by reselling it to exchanges/crypto whales interested in holding thousands of pi coins before the mainnet launch.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and resell to these crypto whales and holders of pi..
This is because pi network is not doing any pre-sale. The only way exchanges can get pi is by buying from miners and pi merchants stands in between the miners and the exchanges.
How can I sell my pi coins?
Selling pi coins is really easy, but first you need to migrate to mainnet wallet before you can do that. I will leave the telegram contact of my personal pi merchant to trade with.
Tele-gram.
@Pi_vendor_247
how to sell pi coins on Bitmart crypto exchangeDOT TECH
Yes. Pi network coins can be exchanged but not on bitmart exchange. Because pi network is still in the enclosed mainnet. The only way pioneers are able to trade pi coins is by reselling the pi coins to pi verified merchants.
A verified merchant is someone who buys pi network coins and resell it to exchanges looking forward to hold till mainnet launch.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
Latino Buying Power - May 2024 Presentation for Latino CaucusDanay Escanaverino
Unlock the potential of Latino Buying Power with this in-depth SlideShare presentation. Explore how the Latino consumer market is transforming the American economy, driven by their significant buying power, entrepreneurial contributions, and growing influence across various sectors.
**Key Sections Covered:**
1. **Economic Impact:** Understand the profound economic impact of Latino consumers on the U.S. economy. Discover how their increasing purchasing power is fueling growth in key industries and contributing to national economic prosperity.
2. **Buying Power:** Dive into detailed analyses of Latino buying power, including its growth trends, key drivers, and projections for the future. Learn how this influential group’s spending habits are shaping market dynamics and creating opportunities for businesses.
3. **Entrepreneurial Contributions:** Explore the entrepreneurial spirit within the Latino community. Examine how Latino-owned businesses are thriving and contributing to job creation, innovation, and economic diversification.
4. **Workforce Statistics:** Gain insights into the role of Latino workers in the American labor market. Review statistics on employment rates, occupational distribution, and the economic contributions of Latino professionals across various industries.
5. **Media Consumption:** Understand the media consumption habits of Latino audiences. Discover their preferences for digital platforms, television, radio, and social media. Learn how these consumption patterns are influencing advertising strategies and media content.
6. **Education:** Examine the educational achievements and challenges within the Latino community. Review statistics on enrollment, graduation rates, and fields of study. Understand the implications of education on economic mobility and workforce readiness.
7. **Home Ownership:** Explore trends in Latino home ownership. Understand the factors driving home buying decisions, the challenges faced by Latino homeowners, and the impact of home ownership on community stability and economic growth.
This SlideShare provides valuable insights for marketers, business owners, policymakers, and anyone interested in the economic influence of the Latino community. By understanding the various facets of Latino buying power, you can effectively engage with this dynamic and growing market segment.
Equip yourself with the knowledge to leverage Latino buying power, tap into their entrepreneurial spirit, and connect with their unique cultural and consumer preferences. Drive your business success by embracing the economic potential of Latino consumers.
**Keywords:** Latino buying power, economic impact, entrepreneurial contributions, workforce statistics, media consumption, education, home ownership, Latino market, Hispanic buying power, Latino purchasing power.
If you are looking for a pi coin investor. Then look no further because I have the right one he is a pi vendor (he buy and resell to whales in China). I met him on a crypto conference and ever since I and my friends have sold more than 10k pi coins to him And he bought all and still want more. I will drop his telegram handle below just send him a message.
@Pi_vendor_247
what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
Empowering the Unbanked: The Vital Role of NBFCs in Promoting Financial Inclu...Vighnesh Shashtri
In India, financial inclusion remains a critical challenge, with a significant portion of the population still unbanked. Non-Banking Financial Companies (NBFCs) have emerged as key players in bridging this gap by providing financial services to those often overlooked by traditional banking institutions. This article delves into how NBFCs are fostering financial inclusion and empowering the unbanked.
Poonawalla Fincorp and IndusInd Bank Introduce New Co-Branded Credit Cardnickysharmasucks
The unveiling of the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card marks a notable milestone in the Indian financial landscape, showcasing a successful partnership between two leading institutions, Poonawalla Fincorp and IndusInd Bank. This co-branded credit card not only offers users a plethora of benefits but also reflects a commitment to innovation and adaptation. With a focus on providing value-driven and customer-centric solutions, this launch represents more than just a new product—it signifies a step towards redefining the banking experience for millions. Promising convenience, rewards, and a touch of luxury in everyday financial transactions, this collaboration aims to cater to the evolving needs of customers and set new standards in the industry.
USDA Loans in California: A Comprehensive Overview.pptxmarketing367770
USDA Loans in California: A Comprehensive Overview
If you're dreaming of owning a home in California's rural or suburban areas, a USDA loan might be the perfect solution. The U.S. Department of Agriculture (USDA) offers these loans to help low-to-moderate-income individuals and families achieve homeownership.
Key Features of USDA Loans:
Zero Down Payment: USDA loans require no down payment, making homeownership more accessible.
Competitive Interest Rates: These loans often come with lower interest rates compared to conventional loans.
Flexible Credit Requirements: USDA loans have more lenient credit score requirements, helping those with less-than-perfect credit.
Guaranteed Loan Program: The USDA guarantees a portion of the loan, reducing risk for lenders and expanding borrowing options.
Eligibility Criteria:
Location: The property must be located in a USDA-designated rural or suburban area. Many areas in California qualify.
Income Limits: Applicants must meet income guidelines, which vary by region and household size.
Primary Residence: The home must be used as the borrower's primary residence.
Application Process:
Find a USDA-Approved Lender: Not all lenders offer USDA loans, so it's essential to choose one approved by the USDA.
Pre-Qualification: Determine your eligibility and the amount you can borrow.
Property Search: Look for properties in eligible rural or suburban areas.
Loan Application: Submit your application, including financial and personal information.
Processing and Approval: The lender and USDA will review your application. If approved, you can proceed to closing.
USDA loans are an excellent option for those looking to buy a home in California's rural and suburban areas. With no down payment and flexible requirements, these loans make homeownership more attainable for many families. Explore your eligibility today and take the first step toward owning your dream home.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
Even tho Pi network is not listed on any exchange yet.
Buying/Selling or investing in pi network coins is highly possible through the help of vendors. You can buy from vendors[ buy directly from the pi network miners and resell it]. I will leave the telegram contact of my personal vendor.
@Pi_vendor_247
how can I sell my pi coins for cash in a pi APPDOT TECH
You can't sell your pi coins in the pi network app. because it is not listed yet on any exchange.
The only way you can sell is by trading your pi coins with an investor (a person looking forward to hold massive amounts of pi coins before mainnet launch) .
You don't need to meet the investor directly all the trades are done with a pi vendor/merchant (a person that buys the pi coins from miners and resell it to investors)
I Will leave The telegram contact of my personal pi vendor, if you are finding a legitimate one.
@Pi_vendor_247
#pi network
#pi coins
#money
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2. THIS LEASING WORKSHOP WILL COVER:
A. WHAT IS LEASING AND WHAT ARE ITS BENEFITS ?
B. LEGAL AND FISCAL FRAMEWORK FOR LEASING
C. ACCOUNTING FOR LEASING, AND LEASING AS
REFLECTED ON FINANCIAL STATEMENTS.
D. TARGETING THE MARKET FOR LEASING: SECTORS AND
TYPES OF EQUIPMENT TO BE LEASED
E. LEASING TRANSACTION PROCEDURES: DEVELOPING
AND CONCLUDING LEASING DEALS.
F. LEASING CONTRACTS: TERMS AND CONDITIONS
G. ORGANIZATION AND STAFFING FOR LEASING ACTIVITIES
H. RISK MANAGEMENT AND RISK ANALYSIS FOR LEASING:
LESSEE RISKS, EQUIPMENT RISKS, VENDOR RISKS.
3. WHAT IS LEASING ?
LEASING IS THE RENTAL OF PRODUCTIVE EQUIPMENT FOR A GIVEN
PERIOD OF TIME (TYPICALLY ONE TO FIVE YEARS).
THE RENTER (THE “LESSEE”) PAYS A MONTHLY RENTAL TO THE
OWNER (THE “LESSOR”) FOR THE USE OF THE EQUIPMENT.
LEASING MAY BE A SIMPLE RENTAL, WITH THE RETURN OF THE
EQUIPMENT TO THE OWNER AT THE END OF THE LEASE PERIOD. THIS IS
USUALLY CALLED “OPERATING LEASING”.
OR, LEASING CAN LEAD TO THE PURCHASE OF THE EQUIPMENT BY THE
RENTER FROM THE OWNER AT THE END OF THE LEASE PERIOD. THIS IS
USUALLY CALLED “FINANCE LEASING” (OR “HIRE-PURCHASE”).
4. A WIDE VARIETY OF ASSETS CAN BE LEASED
THE MAJOR CATEGORIES ARE:
(1) PRODUCTIVE EQUIPMENT AND VEHICLES FOR BUSINESSES.
(2) PRIVATE AUTOMOBILES
(3) REAL-ESTATE: LAND, BUILDINGS
(4) “CONSUMER” LEASING: FURNITURE, HOME APPLIANCES, TELEVISION
SETS ETC.
(5) “BIG TICKET” LEASING: AIRCRAFT, SHIPS
OUR FOCUS TODAY WILL BE ON LEASING OF PRODUCTIVE ASSETS TO
BUSINESSES
5. MANY TYPES OF EQUIPMENT ARE LEASED TO BUSINESSES
VEHICLES: TRUCKS, DELIVERY VEHICLES, AUTO FLEETS, BUSES.
PRODUCTION AND PACKAGING EQUIPMENT
CONSTRUCTION AND MINING EQUIPMENT
AGRICULTURAL EQUIPMENT
OFFICE EQUIPMENT: COMPUTERS, PRINTERS, FURNITURE
MEDICAL AND DENTAL EQUIPMENT
PRINTING EQUIPMENT
ENERGY EQUIPMENT: GENERATORS, SOLAR PANELS ETC.
KITCHEN EQUIPMENT (HOTELS, RESTAURANTS)
6. THERE ARE MANY BENEFITS TO LEASING:
--TO THE ECONOMY OF A COUNTRY:
LEASING SUPPORTS THE EXPANSION OF THE SMALL AND MEDIUM
BUSINESS SECTOR, INCREASING PRODUCTION, EMPLOYMENT AND
EXPORTS.
--TO THE EQUIPMENT USER:
LEASING GIVES A BUSINESS THE ABILITY TO HAVE THE USE OF THE
EQUIPMENT OR VEHICLES THEY NEED WITH MINIMUM DELAY, WITHOUT
NEEDING TO BUY THEM FOR CASH OR TAKE OUT A LOAN FROM A BANK.
--TO SUPPLIERS OF EQUIPMENT: LEASING FACILITATES THE SALE OF THEIR
PRODUCTS.
--TO PROVIDERS OF LEASING: A PROFITABLE FINANCIAL SERVICE WHICH
CAN BE OFFERED TO A WIDE VARIETY OF POTENTIAL CUSTOMERS.
7. LEASING IS A MAJOR ACTIVITY WORLDWIDE
LEASING IS A MAJOR ACTIVITY IN MANY
COUNTRIES AROUND THE WORLD, IN EMERGING
ECONOMICS AS WELL AS IN DEVELOPED
ECONOMIES.
LEASED EQUIPMENT CAN BE A MAJOR SHARE OF
A COUNTRY’S INVESTMENT IN PRODUCTIVE
ASSETS.
8. LEASING CAN BE PROVIDED BY A VARIETY OF SOURCES
LEASING IS A SERVICE OFTEN PROVIDED BY SPECIALIZED COMPANIES,
WITH KNOWLEDGE OF EQUIPMENT AND OF THE CORPORATE AND SME
SECTORS IN THEIR COUNTRIES.
LEASING COMPANIES MAY BE OWNED BY BANKS, OR BY EQUIPMENT
MANUFACTURERS, OR THEY MAY BE INDEPENDENT.
LEASING MAY ALSO BE DONE BY BANKS OR FINANCE COMPANIES ON THEIR
OWN BALANCE SHEETS.
EQUIPMENT DEALERS.MAY DO LEASING, SOMETIMES AS “CAPTIVES” OF
ONE MANUFACTURER.
LEASING REQUIRES ENOUGH CAPITAL AND FINANCIAL SUPPORT TO BE
ABLE TO BUY EQUIPMENT AND LEASE IT FOR MULTI-YEAR PERIODS.
INTERNATIONAL DONORS ACTIVELY SUPPORT THE DEVELOPMENT OF
LEASING IN EMERGING MARKETS BY PROVIDING EQUITY AND DEBT
FINANCING TO SUPPORT LEASING. .
9. THE ENVIRONMENT
FOR LEASING
Prepared by USAID’s Financial Access for Investing in the Development of Afghanistan.
10. THE ENVIRONMENT FOR LEASING
LEASING NEEDS AN ENVIRONMENT WITHIN WHICH IT CAN OPERATE.
KEY ELEMENTS ARE:
(1) A LEGAL SYSTEM WHERE PROPERTY RIGHTS ARE CLEAR AND
CONTRACTS ARE ENFORCEABLE IN COURTS.
(2)ACCOUNTING AND TAX TREATMENT OF LEASING WHICH IS REASONABLY
APPLIED AND WHICH CONFORM TO INTERNATIONAL PRACTICES.
(3) AN INSURANCE SECTOR WHICH PERMITS LEASED ASSETS TO BE
INSURED AGAINST MAJOR RISKS.
(4) SOME FORM OF REGISTRATION OF PLEDGES ON MOVABLE PROPERTY
.
(5) A LEGAL AND REGULATORY ENVIRONMENT WHICH
ENCOURAGES LEASING, RATHER THAN OVERLY RESTRICTS IT.
11. THE ENVIRONMENT FOR LEASING
(1) A LEGAL SYSTEM WHERE PROPERTY RIGHTS ARE
CLEAR AND CONTRACTS ARE ENFORCEABLE IN COURTS
--OWNERSHIP TITLE TO VEHICLES AND EQUIPMENT NEED
TO BE CLEAR AND DOCUMENTS CAN PROVE
OWNERSHIP
--CONTRACTS BETWEEN PRIVATE PARTIES, IN CASE OF
DISPUTE, CAN BE SETTLED THROUGH THE LEGAL
SYSTEM
--PROCEDURES FOR FORECLOSURE ON COLLATERAL
(BANKS), OR REPOSSESSION OF LEASED ASSETS BY
LESSORS, FUNCTION EFFECTIVELY WITHOUT UNDUE
DELAY.
12. THE ENVIRONMENT FOR LEASING
(2) ACCOUNTING AND TAX TREATMENT OF
LEASING WHICH IS REASONABLY APPLIED AND
CONFORMS TO INTERNATIONAL PRACTICES.
A. CORPORATE INCOME TAX LAW: PROVISIONS RELEVANT
TO LEASING CAN INCLUDE:
--DEFINITION OF FINANCE LEASES
--ACCOUNTING TREATMENT OF FINANCE LEASES
--DEPRECIATION SCHEDULES FOR TYPES OF ASSETS
B. VALUE ADDED TAX (VAT) LAW PROVISIONS RELEVANT TO
LEASING CAN INCLUDE:
--VAT APPLICABLE TO INTEREST
--VAT APPLIABLE TO PURCHASE AND SALE OF ASSETS.
13. THE ENVIRONMENT FOR LEASING
(3) AN INSURANCE SECTOR WHICH PERMITS LEASED
ASSETS TO BE INSURED AGAINST MAJOR RISKS.
INSURANCE CAN COVER MOST RISKS ASSOCIATED WITH
VARIOUS TYPES OF LEASED ASSETS:
--VEHICLES (PASSENGER OR COMMERCIAL):
THIRD PARTY LIABILITY, DAMAGE, THEFT, FIRE ETC
--MANUFACTURING EQUIPMENT
--CONSTRUCTION AND MINING EQUIPMENT
--AGRICULTURAL EQUIPMENT
14. THE ENVIRONMENT FOR LEASING
(4) SOME FORM OF REGISTRATION OF PLEDGES ON
MOVABLE PROPERTY:
--LAWS ON SECURED TRANSACTIONS ON MOVABLE
PROPERTY SHOULD INCLUDE LENDERS’ COLLATERAL,
BUT ALSO LEASED ASSETS UNDER LEASING
TRANSACTIONS.
--THE REGISTRY OF SECURING CHARGES (OR MOVABLE
COLLATERAL REGISTY) SHOULD PROVIDE FOR CLEAR
REGISTRATION OF LEASED ASSETS, FULLY TRANSPARENT
TO THIRD PARTIES.
--REGISTRY PERMITS LESSORS TO REGISTER EQUIPMENT WHICH
IS LEASED UNDER LEASE CONTRACT, PROTECTING AGAINST
PLEDGE OR SALE TO OTHER PARTIES
15. ENVIRONMENT FOR LEASING
(5) A LEGAL AND REGULATORY ENVIRONMENT
WHICH ENCOURAGES LEASING, RATHER THAN
OVERLY RESTRICTS IT.
--THERE ARE LAWS IN FORCE RELATING TO FINANCIAL
LEASING.
--THERE IS A CLEAR PROCESS (CENTRAL BANK OR OTHER
AUTHORITY) FOR LICENCING AND REGULATING LEASING,
BY BANKS, BY BANK-OWNED LEASING COMPANIES, AND
BY NON-BANK LEASING COMPANIES.
17. ACCOUNTING TREATMENT OF LEASING
THERE ARE TWO METHODS OF ACCOUNTING FOR LEASING:
(1)THE “LEGAL” METHOD: THE ASSET IS ON THE BALANCE SHEET OF THE
LEGAL OWNER (THE LESSOR);
(2) THE “ECONOMIC” METHOD: THE ASSET IS ON THE BALANCE SHEET OF
THE USER (LESSEE), WHO HAS THE ECONOMIC BENEFIT OF THE
EQUIPMENT.
THE METHOD USED BY LESSORS AND LESSEES IN A GIVEN COUNTRY IS
THE ONE REQUIRED BY THE TAX AUTHORITIES IN THAT COUNTRY,
PRACTICES IN DIFFERENT COUNTRIES VARY WIDELY. SOME USE THE
“LEGAL” METHOD FOR ALL LEASES. OTHERS USE THE “ECONOMIC”
METHOD FOR FINANCE LEASES (AS IN ARMENIA) AND THE “LEGAL
METHOD” FOR OPERATING LEASES.
18. ACCOUNTING TREATMENT OF LEASING
“LEGAL” METHOD OF ACCOUNTING:
--THE LEASED ASSET IS BOOKED AS A “FIXED ASSET” TO THE
LESSOR.
--THE LESSOR TAKES THE DEPRECATION EXPENSES.
--THE LEASE PAYMENT IS A REVENUE FOR THE LESSOR,
AND AN EXPENSE FOR THE USER.
--THERE IS NO ASSET OR LIABILITY ON THE BALANCE SHEET
OF THE USER.
--THIS METHOD IS IAS STANDARD FOR “OPERATING LEASES”
19. ACCOUNTING TREATMENT OF LEASING
“ECONOMIC” METHOD OF ACCOUNTING:
--THE LEASED EQUIPMENT IS A “FIXED ASSET” ON THE
BALANCE SHEET OF THE USER (LESSEE)
--THE LESSEE TAKES THE DEPRECIATION EXPENSE.
--THE LEASE CONTRACT IS A FINANCIAL ASSET FOR THE
LESSOR (FINANCE LEASES RECEIVABLE) AND A LIABILITY
FOR THE LESSEE (FINANCE LEASES PAYABLE)
--THE LEASE PAYMENT IS DIVIDED INTO TWO PARTS:
(A) INTEREST ( REVENUE FOR THE LESSOR, AND AN
EXPENSE FOR THE LESSEE)
(B) PRINCIPAL (A REDUCTION OF FINANCE LEASES
RECEIVABLE/PAYMENT, NOT A REVENUE OR EXPENSE).
--THIS METHOD IS IAS STANDARD FOR “FINANCE LEASES”
20. ACCOUNTING TREATMENT OF LEASING
LAWS OF ARMENIA RELEVANT TO LEASING:
CIVIL CODE (ARTICLES 677-684) DEFINE “FINANCE LEASING” BUT IS SILENT
ON ACCOUNTING TREATMENT.
ACCOUNTING UNDER TAX LAWS IS DONE UNDER “ECONOMIC” METHOD:
INCOME TAX LAW (ARTICLE 12) PROVIDES FOR
DEPRECIATION OF FIXED ASSETS (INCLUDING LEASED ASSETS):
PRODUCTIVE EQUIPMENT: 3 YEARS (AFTER 1/14: 50 %)
OTHER FIXED ASSETS: 5 YEARS (AFTER 1/14: 30 %)
LEASED ASSETS ON BALANCE SHEET OF LESSEE, WHO TAKES THE
DEPRECIATION EXPENSE (TAX DEDUCTIBLE EXPENSE)
LEASE PAYMENTS: INTEREST PORTION IS INCOME TO LESSOR, AND
DEDUCTIBLE EXPENSE TO LESSEE.
LAW ON VAT:
VAT (20 %) IS PAYABLE ON PURCHASE/SALE OF LEASED ASSETS.
PRINCIPAL FORTION OF LEASING PAYMENTS ARE SUBJECT TO 20 % VAT.
INTEREST PORTION OF LEASING PAYMENTS ARE NOT SUBJECT TO VAT.
22. TARGETING THE MARKET FOR LEASING
THE MARKET FOR LEASING HAS THE
FOLLOWING ELEMENTS (TO BE DECIDED AS
A MATTER OF POLICY):
--PARAMETERS FOR LEASING DEALS
--ECONOMIC SECTORS TO BE TARGETTED
--TYPES OF EQUIPMENT TO BE LEASED
--CRITERIA FOR ACCEPTABLE LESSEES
--VENDOR RELATIONSHIPS TO BE TARGETTED
23. TARGETING THE MARKET FOR LEASING
LEGAL OFFICER:
--PREPARE DOCUMENTS FOR LEASING
DEALS
PARAMETERS FOR LEASING DEALS:
--WHETHER TO OFFER FINANCE LEASES, OPERATING
LEASES OR BOTH.
--TERM OF LEASES: POLICY BASED ON LESSOR’S FUNDING
AND ON RISK CONSIDERATIONS:
--LEASE CONTRACTS
--SUPPLIER CONTRACTS
FINANCE LEASES: 2 YEARS MINIMUM, 4 YEARS MAXIMUM
OPERATING LEASES: ONE YEAR MIN., 3 YEARS MAXIMUM
--LEGAL ENFORCEMENT OF LEASING
CONTRACT
--LESSEE SHARE OF “EQUITY”: 20% MIN.(30% STANDARD)
--REPOSSESSION
--COURT CASE
(PREPAYMENT/SECURITY DEPOSIT)
--CURRENCY, PRICING OF LEASES: BASED ON LESSOR
LEGAL FUNDING; OFFICER:
INTEREST FORMULA (FIXED OR ADJUSTABLE)
----LEASE P
AMOUNTS: WHAT WILL MINIMUM AND MAXIMUM
LEASE TRANSACTION AMOUNT BE (BASED ON LESSOR
CAPACITY, TYPE OF LESSEE, TYPES OF EQUIPMENT)
24. TARGETING THE MARKET FOR LEASING
ECONOMIC SECTORS TO BE TARGETED:
SECTOR POLICY FOR LEASING IS BASED ON LESSOR’S
SECTOR STRATEGY OR ON TYPES OF EQUIPMENT
TARGETTED. TYPICAL SECTORS FOR LEASING ARE:
--MANUFACTURING
--PROCESSING AND PACKAGING
--AGRICULTURE
--CONSTRUCTION
--TRANSPORTATION
--MINING
--MEDICAL
25. TARGETING THE MARKET FOR LEASING
TYPES OF EQUIPMENT TO BE LEASED:
EQUIPMENT POLICY IS BASED ON SECTOR STRATEGY, OR
ON OTHER FACTORS SUCH AS DEALER RELATIONSHIPS
OR EQUIPMENT RISK CONSIDERATIONS.
DOES THE LESSOR WISH TO SPECIALIZE ?
TYPICAL EQUIPMENT CATEGORIES FOR LEASING ARE:
--LIGHT VEHICLES (PASSENGER, COMMERCIAL, DELIVERY)
--HEAVY TRUCKS
--AGRICULTURAL EQUIPMENT (TRACTORS ETC).
--CONSTRUCTION EQUIPMENT, MINING EQUIPMENT
--LIGHT PRODUCTION EQUIPMENT
--PACKAGING EQUIPMENT
--MEDICAL AND DENTAL EQUIPMENT
--ENERGY EQUIPMENT (GENERATORS, SOLAR PANELS ETC)
26. TARGETING THE MARKET FOR LEASING
CRITERIA FOR ACCEPTABLE LESSEES
POLICY FOR LESSEES IS BASED ON LESSOR’S TARGET
CUSTOMER STRATEGY AND RISK CRITERIA.
TYPICAL CATEGORIES WOULD BE:
--ESTABLISHED COMPANIES, POSITIVE CREDIT HISTORY
--GROWING COMPANIES WITH GOOD SALES GROWTH BUT
OUT CREDIT HISTORY
--START-UP COMPANIES WITH STRONG SALES PROSPECTS
--COMPANIES IN ACCEPTABLE ECONOMIC SECTORS
--COMPANIES WISHING TO LEASE EQUIPMENT WHICH THE
LESSOR IS TARGETING (WHICH COULD BE UNDER
VENDOR AGREEMENTS)
27. TARGETING THE MARKET FOR LEASING
VENDOR RELATIONSHIPS TO BE TARGETTED
VENDOR STRATEGIES CAN BE PART OF A LEASING
STRATEGY.
AGREEMENTS CAN BE CONCLUDED WITH VENDORS OF
EQUIPMENT WHICH THE LESSOR WISHES TO LEASE.
AGREEMENTS WITH VENDORS CAN BE EXCLUSIVE OR NON-EXCLUSIVE
THEY CAN INVOLVE A BUY-BACK COMMITMENT FROM THE
VENDOR, OR ONLY A REMARKETING AGREEMENT.
AN AGREEMENT CAN INCLUDE A DISCOUNT OR
COMMISSION TO THE LESSOR FOR BUYING AND LEASING
THE VENDOR’S EQUIPMENT, IMPROVING LESSOR
PROFITABILITY.
29. LEASING TRANSACTION PROCEDURES
STEPS IN DOING A LEASING DEAL:
(1) IDENTIFY THE CUSTOMER OPPORTUNITY
(2) OBTAIN NECESSARY INFORMATION
(3) ANALYZE THE RISKS
(4) PREPARE AND SUBMIT THE PROPOSAL FOR APPROVAL
(5) AGREE ON TERMS WITH LESSEE AND VENDOR
(6) FORMALIZE, DOCUMENT THE DEAL: SIGN CONTRACT
WITH LESSEE, ORDER EQUIPMENT FROM VENDOR
(7) DELIVERY, INSTALLATION AND PAYMENT
(8) SUBSEQUENT MONITORING
(9) REMEDIAL MEASURES IN EVENT OF DEFAULT
(10) ACTIONS AT END OF LEASE TERM
30. LEASING TRANSACTION PROCEDURES
(1) IDENTIFY THE CUSTOMER OPPORTUNITY
CUSTOMER OPPORTUNITIES CAN ARISE FROM:
--RELATIONSHIPS WITH POTENTIAL LESSEES (CORPORATE,
SME, MICRO), AND KNOWLEDGE OF THEIR EQUIPMENT
NEEDS.
--RELATIONSHIPS WITH EQUIPMENT VENDORS, WHO
IDENTIFY AND REFER POTENTIAL CUSTOMERS TO THE
LESSOR
--LESSOR EXPERTISE IN A GIVEN SECTOR, IDENTIFYING
GROWING COMPANIES IN THAT SECTOR.
--PUBLIC MARKETING AND MEDIA CAMPAIGN RESULTS IN
LESSEE IDENTIFICATION
31. LEASING TRANSACTION PROCEDURES
(2) OBTAIN NECESSARY INFORMATION:
A. INFORMATION ABOUT LESSEE:
--LEGAL/INCORPORATION DOCUMENTS
--FINANCIAL STATEMENTS/FORECASTS
--BUSINESS INFORMATION (PRODUCTS,
CUSTOMERS)
B. INFORMATION ABOUT EQUIPMENT
C. INFORMATION ABOUT MANUFACTURER
D. INFORMATION ABOUT VENDOR
32. LEASING TRANSACTION PROCEDURES
(3) ANALYZE THE RISKS:
--LESSEE RISK: CAN THE LESSEE’S CASH FLOW
MEET THE LEASING PAYMENTS ?
--EQUIPMENT RISK: DOES THE EQUIPMENT HAVE
MARKET VALUE FOR THE LIFE OF THE LEASE ?
--VENDOR RISK: IS THE VENDOR STABLE ENOUGH
TO FULFILL ITS COMMITMENTS FOR THE LIFE
OF THE LEASE ?
33. LEASING TRANSACTION PROCEDURES
(4) PREPARE THE PROPOSAL:
DECIDE ON:
--TERM OF LEASE
--TYPE OF LEASE (FINANCIAL/OPERATING)
--AMOUNT TO BE FINANCED
EQUIPMENT COST
LESS: PREPAYMENT FROM LESSEE (%)
--INTEREST RATE BASIS
--MONTHLY LEASE PAYMENT SCHEDULE
SUBMIT PROPOSAL FOR COMMITTEE APPROVAL.
34. LEASING TRANSACTION PROCEDURES
(5) AGREE ON TERMS WITH LESSEE AND VENDOR:
--OBTAIN FIRM EQUIPMENT COST QUOTE FROM
MANUFACTURER OR FROM VENDOR, INCLUDING TERMS
OF PAYMENT (IMPORT COULD REQUIRE BANK L/C)
--DETERMINE TOTAL COSTS: EQUIPMENT PLUS ALL OTHER
COSTS TO TRANSPORT, IMPORT AND INSTALL (FREIGHT,
INSURANCE, CUSTOMS DUTY, TAXES ETC)
--QUOTE LEASE TERMS TO LESSEE, GET LESSEE’S
AGREEMENT TO TERMS AND TO THE LEASE CONTRACT
DRAFT.
--LESSEE PROVIDES WRITTEN REQUEST TO LEASE THE
EQUIPMENT, SPECIFYING THE EQUIPMENT, THE
MANUFACTURER AND THE VENDOR.
35. LEASING TRANSACTION PROCEDURES
(6) FORMALIZE AND DOCUMENT THE DEAL:
--SIGN THE LEASE CONTRACT WITH LESSEE
--LESSEE PAYS PREPAYMENT AND FEE.
--LESSOR PLACES A FIRM ORDER WITH VENDOR TO
PURCHASE THE EQUIPMENT, FOR DELIVERY TO LESSEE
PREMISES. TERMS OF DELIVERY AND PAYMENT AGREED.
--IF AGREED (FOR IMPORT), OPENING BANK L/C IN FAVOR OF
FOREIGN MANUFACTURER/VENDOR.
--CONCLUDE AN AGREEMENT IN SOME FORM WITH VENDOR
(SERVICE/MAINTENANCE; POSSIBLY BUY-BACK OR
REMARKETING).
36. LEASING TRANSACTION PROCEDURES
(7) DELIVERY, INSTALLATION AND PAYMENT
--COMPLETE CUSTOMS FORMALITIES (IF IMPORT)
--DELIVERY AT LESSEES’ PREMISES
--REGISTER SECURING CHARGE ON EQUIPMENT.
--LESSEE SIGNS ACCEPTANCE CERTIFICATE (LEASE
CONTRACT TAKES EFFECT)
--INSURE EQUIPMENT FOR ALL INSURABLE RISKS.
--PAYMENT BY LESSOR TO VENDOR UPON DELIVERY.
--FIRST LEASE PAYMENT FROM LESSEE ON FIRST DAY OF
MONTH AFTER DATE OF DELIVERY.
37. LEASING TRANSACTION PROCEDURES
(8) SUBSEQUENT MONITORING:
--TECHNICAL MANAGER CHECKS ON USE OF EQUIPMENT,
ITS CONDITION, SERVICE AND MAINTENANCE
--FINANCE REPORTS ANY LATE PAYMENT
--LEASING OPERATIONS FOLLOWS UP WITH LESSEES FOR
ANY PERFORMANCE GAPS, INCLUDING LATE PAYMENT
STARTING ONE DAY AFTER PAYMENT OVERDUE.
--COLLECTION OFFICER FOLLOWS UP IS PAYMENT 15 DAYS
OVERDUE. DEFAULT ON CONTRACT IF OVERDUE 30 DAYS
38. LEASING TRANSACTION PROCEDURES
(9) REMEDIAL MEASURES IN EVENT OF DEFAULT:
--NON-PAYING LESSEE MAY WISH TO RETURN THE
EQUIPMENT, TERMINATING THE LEASE CONTRACT
(LOSING THEIR PREPAYMENT). LESSOR MAY THEN SELL
OR LEASE THE EQUIPMENT AT A PROFIT. .
--WITH NON-COOPERATING LESSEE, LESSOR SHOULD TAKE
REPOSSESSION ACTION (OUT OF COURT PROCESS OF
SEIZURE OF LEASED ASSET) WHERE LAWS PROVIDE FOR
SUCH ACTION
--ANOTHER REMEDY IS A LAWSUIT THROUGH THE COURTS
TO ENFORCE THE LEASE CONTRACT AGAINST THE
LESSEE AND ANY GUARANTORS.
39. LEASING TRANSACTION PROCEDURES
(10) ACTIONS AT END OF LEASE TERM
A. FINANCE LEASE:
THE LESSEE’S OPTIONS ARE:
--LESSEE MAY OPT TO BUY THE EQUIPMENT (PRICE IS
AGREED IN ADVANCE IN A FINANCE LEASE CONTRACT)
--LESSEE MAY RETURN THE EQUIPMENT TO LESSOR, WHO
MAY LEASE IT, OR SELL IT TO THE VENDOR OR TO
ANOTHER PARTY.
--IF LESSEE WISHES TO BUY BEFORE END OF LEASE
CONTRACT, LESSEE PAYS FULL REMAINING PAYMENTS
PLUS RESIDUAL VALUE PLUS EARLY TERMINATION FEE.
40. LEASING TRANSACTION PROCEDURES
(10) ACTIONS AT END OF LEASE TERM
B. OPERATING LEASE:
THE LEASED EQUIPMENT IS RETURNED TO LESSOR, WHO
MAY TAKE ONE OF THE FOLLOWING ACTIONS:
--LEASE THE TRUCK TO ANOTHER USER.
--SELL THE TRUCK TO ANOTHER PARTY
--SELL IT TO THE DEALER, UNDER A BUY-BACK AGREEMENT
--SELL IT TO THE LESSEE (RESIDUAL VALUE)
--LEASE IT AGAIN TO THE LESSEE.
41. TWO TYPES OF LEASING: SIMILARITIES AND DIFFERENCES
IN BOTH CASES:
--THE LESSEE CAN START USING THE EQUIPMENT REASONABLY QUICKLY.
-- NO OTHER COLLATERAL IS NORMALLY NEEDED, ONLY A DOWN PAYMENT OF 20 %
OR 30 % OF THE PURCHASE PRICE.
--THE LEASING COMPANY REMAINS OWNER FOR THE PERIOD OF THE LEASE
--THE LEASING COMPANY CAN TAKE THE EQUIPMENT BACK IF THE COMPANY DOES
NOT MAKE ITS MONTHLY LEASE PAYMENTS.
THE DIFFERENCES ARE:
FINANCE LEASING:
--THE LESSEE WILL OWN THE PRODUCTION LINE AT THE END OF THE LEASE
CONTRACT TERM;
--LESSEE IS RESPONSIBLE FOR SERVICE AND MAINTENANCE OF THE LEASED
EQUIPMENT (UNDER AGREEMENTS WITH THE MANUFACTURER OR DEALER)
OPERATING LEASING:
--LESSEE WILL RETURN THE EQUIPMENTTO THE LEASING COMPANY AT THE END OF
THE LEASE CONTRACT TERM.
--THE LEASING COMPANY IS RESPONSIBLE FOR SERVICE AND MAINTENANCE
43. LEASING CONTRACTS
LEASING CONTRACTS MAY VARY IN FORM, BUT THEIR
CONTENTS ARE STANDARD.
FINANCING LEASE CONTRACTS AND OPERATING LEASE
CONTRACTS ARE VERY SIMILAR IN MOST RESPECTS, BUT
DIFFER IN A FEW KEY WAYS.
AN EXAMPLE OF A LEASE CONTRACT CONTAINS:
(A)PARTICULAR TERMS AND CONDITIONS (THE SPECIFICS
OF THE DEAL FOR THAT GIVEN LESSEE)
(B) STANDARD TERMS AND CONDITIONS (WHICH DO NOT
VARY FROM CASE TO CASE)
(C) ANNEXES TO THE LEASE CONTRACT
44. LEASING CONTRACTS
(A) PARTICULAR TERMS AND CONDITIONS:
1. DESCRIPTION OF EQUIPMENT (DETAILS IN ANNEX A)
2. LOCATION OF LEASED EQUIPMENT
3. EXPECTED DATE OF DELIVERY OF THE EQUIPMENT
4. CONTRACT TERM (NUMBER OF MONTHS) FROM DATE
OF DELIVERY THROUGH FINAL LEASE PAYMENT.
5. PURCHASE PRICE OF EQUIPMENT (TOTAL COST)
6. PREPAYMENT FROM LESSEE (% OF TOTAL COST)
7. FINANCED AMOUNT (5 LESS 6): (% OF TOTAL COST)
8. NUMBER AND DATE OF MONTHLY LEASE PAYMENTS.
9. INTEREST RATE FORMULA (FINANCE LEASE ONLY)
10. ADMINISTRATIVE FEE (% OF PURCHASE PRICE)
11. RESIDUAL VALUE (IF ANY)
45. LEASING CONTRACTS
GENERAL TERMS AND CONDITIONS
KEY CLAUSES:
1.LESSOR WILL PURCHASE THE OBJECT OF LEASING (THE
EQUIPMENT). LESSOR WILL BE THE EXCLUSIVE OWNER.
OF THE EQUIPMENT FOR THE LIFE OF THE CONTRACT
2. OBJECT OF LEASING, AND ITS SUPPLIER, HAVE BEEN
SELECTED BY THE LESSEE, NOT BY THE LESSOR.
3. LEASE OF EQUIPMENT IS ONLY FOR LESSEE’S USE AND
ONLY AT THE “LOCATION”
4. LESSEE ACCEPTS THE EQUIPMENT BY SIGNING A
“CERTIFICATE OF ACCEPTANCE” (ANNEX B) ON THE DATE
OF DELIVERY. ANY CAUSE OF NON-ACCEPTANCE IS THE
RESPONSIBILITY OF THE SUPPLIER, NOT THE LESSOR.
46. LEASING CONTRACT: GENERAL TERMS
5. OWNERSHIP OF THE OBJECT OF LEASING: THE LESSOR
IS SOLE OWNER FOR THE ENTIRE LIFE OF THE LEASE
CONTRACT
6. LESSEE’S OPTION TO PURCHASE THE OBJECT OF
LEASING (FINANCE LEASE ONLY), AT END OF LEASE
CONTRACT, AND CONDITIONS FOR PURCHASE BEFORE
END OF LEASE CONTRACT.
7. PREPAYMENTS AND ADMINISTRATIVE FEE PAYABLE AT
TIME OF SIGNING OF LEASE CONTRACT.
8. MONTHLY LEASE PAYMENTS; DEFINITION OF DUE DATE.
EVENT OF DEFAULT IF UNPAID MORE THAN 15 DAYS
AFTER DUE DATE.
9 PENALTY FEES FOR LATE PAYMENT (5 % OF OVERDUE
AMOUNT AFTER 15 DAYS, PLUS 0.1 % PER DAY OF
OVERDUE AMOUNT AFTER 30 DAYS)
47. LEASING CONTRACT: GENERAL TERMS
10. INTEREST RATE CALCULATION (FINANCE LEASE ONLY).
TWO OPTIONS: (A) FIXED INTEREST FOR LIFE OF LEASE
(B) VARIABLE INTEREST RATE BASED ON A
STATED FORMULA.
11. INSURANCE: OBJECT OF LEASING WILL BE INSURED
AGAINST ALL RISKS BY INSURER ARRANGED BY OR
APPROVED BY THE LESSOR. COST OF INSURANCE IS
PAID FOR THE LESSEE (FINANCE LEASE) OR BY THE
LESSOR (OPERATING LEASE).
12. WARRANTIES ON OBJECT OF LEASING: LESSOR ASSIGNS
WARRANTIES IN FAVOR OF LESSEE. ANY REMEDIES BY
LESSEE ARE AGAINST SUPPLIER OR MANUFACTURER,
NOT AGAINST LESSOR.
48. LEASING CONTRACT: GENERAL TERMS
13. SERVICE AND MAINTENANCE: MUST BE PERFORMED BY
LESSEE (FINANCE LEASE) UNDER SERVICE AGREEMENTS
WITH VENDOR (LESSEE IS RESPONSIBLE FOR ANY
FAILURE TO MAINTAIN). LESSOR IS RESPONSIBLE FOR
SERVICE AND MAINTENANCE UNDER OPERATING LEASE,
ALSO UNDER AGREEMENTS WITH VENDOR.
14. LESSOR RIGHT OF INSPECTION OF LEASED EQUIPMENT
AT ANY TIME (LESSOR RIGHT TO ENTER LESSEE
PREMISES)
15. NO ASSIGNMENT OR SUBLEASE OF OBJECT OF LEASE
WITHOUT WRITTEN APPROVAL OF LESSOR. ONLY LESSEE
(ITS DESIGNATED EMPLOYEES) MAY USE THE
EQUIPMENT. LESSEE MAY NOT DISPOSE OF THE
EQUIPMENT.
49. LEASING CONTRACT: GENERAL TERMS
16. RETURN OF THE EQUIPMENT: AT THE END OF THE LEASE
CONTRACT, OR UPON TERMINATION FOR ANY REASON,
LESSEE MUST RETURN THE EQUIPMENT TO LESSOR IN
THE SAME CONDITION AS WHEN DELIVERED, EXCEPT
FOR NORMAL WEAR AND TEAR.
17. LESSOR MAY PHYSICALLY REPOSSESS THE EQUIPMENT
AT THE END OF THE CONTRACT TERM, OR UPON EARLY
TERMINATION DUE TO A LESSEE DEFAULT.
18. REGISTRATION OF THE OBJECT OF LEASING WILL BE
DONE AT THE REGISTRY OF SECURING CHARGES
BEFORE ITS DELIVERY TO THE LESSEE.
50. LEASING CONTRACT: GENERAL TERMS
19. EVENTS OF DEFAULT (CONTRACT TERMINATION):
--LESSEE IS MORE THAN 30 DAYS IN ARREARS ON PAYMENT
--FAILURE TO MAINTAIN THE LEASED EQUIPMENT
--IMPROPER USE OF LEASED EQUIPMENT
--LESSEE PROVIDED FALSE INFORMATION TO LESSOR
20. REMEDIES IN EVENT OF DEFAULT: LESSOR MAY:
--REQUIRE IMMEDIATE RETURN OF EQUIPMENT.
--TAKE PHYSICAL REPOSSESSION OF EQUIPMENT
--DECLARE ALL REMAINING LEASE PAYMENTS IMMEDIATELY
DUE AND PAYABLE.
--BEGIN COURT PROCEEDINGS TO RECOVER ALL DAMAGES
AND COSTS.
51. LEASING CONTRACT: ANNEXES
ANNEX A: DETAILED DESCRIPTION OF OBJECT OF LEASING,
AND WRITTEN REQUEST OF LESSEE TO LESSOR TO
PURCHASE THE OBJECT OF LEASING.
ANNEX B: CONSENT OF OWNER OF PROPERTY WHERE THE
OBJECT OF LEASING WILL BE LOCATED.
ANNEX C: CERTIFICATE OF ACCEPTANCE BY LESSEE OF
OBJECT OF LEASING (DATE OF DELIVERY, START OF THE
TERM OF LEASE)
ANNEX D: SCHEDULE OF MONTHLY LEASE PAYMENTS
52. LEASING CONTRACT
THE DIFFERENCES BETWEEN CONTRACTS FOR FINANCE
LEASING AND OPERATING LEASES ARE:
--FINANCE LEASE PAYMENTS CONSIST OF PRINCIPAL PLUS
INTEREST; OPERATING LEASE PAYMENTS ARE RENTAL
PAYMENTS.
--FINANCE LEASES GIVE LESSEE THE OPTION TO BUY THE
EQUIPMENT; OPERATING LEASES REQUIRE THE RETURN
OF THE EQUIPMENT TO LESSOR.
--FINANCE LEASES REQUIRE LESSEE TO ENSURE SERVICE
AND MAINTENANCE AND PAY INSURANCE COSTS; IN
OPERATING LEASES, LESSOR IS RESPONSIBLE FOR
SERVICE AND MAINTENANCE AND COST OF INSURANCE,
(THE RENTAL PAYMENT INCLUDES SUCH COSTS)
54. LEASING ORGANIZATION
BOARD OF
DIRECTORS
General Manager
Leasing
Operations Manager
Credit and Risk
Manager
Finance and
Accounting Manager
Transaction
Processing
(Leasing Officers)
Technical
Manager
Legal
Risk Mgmt
Committee
Lease Credit
Committee
Monitoring/Collections
55. STAFFING FOR LEASING
--LEASING OPERATIONS: NEW DEALS;
CUSTOMER/VENDOR RELATIONS
--TECHNICAL MANAGER
--CREDIT AND RISK MANAGEMENT
--FINANCE AND ACCOUNTING
--LEGAL OFFICER
56. STAFFING FOR LEASING
LEASING OPERATIONS:
(A) LEASING OFFICERS:
--DEVELOPS NEW DEALS (LEASING SALES)
--CUSTOMER (LESSEE) RELATIONSHIPS
--VENDOR (SUPPLIER) RELATIONSHIPS
--PROPOSE NEW DEALS; PROVIDE LESSEE AND VENDOR
INFORMATION FOR LESSEE AND VENDOR RISK ANALYSIS
(B) MONITORING AND COLLECTION:
--DEAL CLOSING PROCESS WITH VENDORS AND LESSEES
--MANAGE PAYMENTS COLLECTION (CUSTOMER CONTACT)
57. STAFFING FOR LEASING
TECHNICAL MANAGER:
--PROVIDES EQUIPMENT KNOWHOW (RISK ASSESSMENT)
--SUPPORTS EQUIPMENT DELIVERY PROCESS
--RELATIONS WITH VENDORS REGARDING LEASED
EQUIPMENT (SERVICE, MAINTENANCE, SPARE PARTS)
--MONITORS USE OF EQUIPMENT BY LESSEE
--SUPPORTS EQUIPMENT REPOSSESSION AND
REPOSITIONING.
58. STAFFING FOR LEASING
CREDIT AND RISK MANAGEMENT:
--ANALYSIS OF NEW PROPOSALS:
--LESSEE RISK
--VENDOR RISK
--EQUIPMENT RISK
--MANAGES LEASING COMMITTEE (DEAL APPROVAL) PROCESS
--PREPARES REPORTS ON PORTFOLIO PERFORMANCE
59. STAFFING FOR LEASING
FINANCE AND ACCOUNTING:
--ACCOUNTING AND BOOKKEEPING.
--FINANCIAL STATEMENT PREPARATION
--REPORTS FOR MANAGEMENT, FOR CREDITORS AND FOR
SHAREHOLDERS
--TAX REPORTING AND RELATIONS WITH TAX AUTHORITIES
--RELATIONSHIPS WITH EXTERNAL AUDITORS
60. STAFFING FOR LEASING
LEGAL OFFICER:
--PREPARE DOCUMENTS FOR LEASING DEALS
--LEASE CONTRACTS
--SUPPLIER CONTRACTS
--LEGAL ENFORCEMENT OF LEASING CONTRACT
--REPOSSESSION
--COURT CASES
--COMPLIANCE (KNOW YOUR CUSTOMER, ANTI-MONEY
LAUNDERING)
--CORPORATE LEGAL PROCESSES
62. RISK ANALYSIS OF LEASING
RISK MANAGEMENT PROCESS FOR LEASING
--RISK MANAGEMENT FLOW CHART (HANDOUT)
--LEASING STRATEGY AND POLICIES
(APPROVAL “IN ADVANCE”, SETTING BOUNDARIES FOR DEALS)
--RISK ANALYSIS PROCESS
(APPROVAL OF SPECIFIC DEALS)
LESSEE RISK
EQUIPMENT RISK
VENDOR RISK
LEGAL RISKS
ECONOMIC/SECTOR RISKS
63. LEASING STRATEGIES
EXAMPLES OF LEASING STRATEGIES:
--TYPES OF LEASING PRODUCTS TO BE OFFERED
--TARGETED RESULTS (PROFITABILITY—ROI/ROA)
--TARGET LEASING PORTFOLIO (TOTAL FUNDING AVAILABLE
FOR LEASING)
--SECTOR TARGETS
--TYPES OF EQUIPMENT TO BE LEASED (AND PROHIBITIONS)
64. LEASING POLICIES
EXAMPLES OF LEASING POLICIES (“DECISIONS TAKEN IN
ADVANCE”)
--PRICING FOR LEASING DEALS:
- INTEREST OR RATE OF RETURN BASIS FOR
CALCULATING PAYMENTS.(MINIMUM/MAXIMUM)
- FEES TO APPLY TO ALL DEALS
--SIZE AND TERM OF DEALS(MINIMUM/MAXIMUM)
--MINIMUM PREPAYMENT FROM LESSEES
--SECTOR TARGETS (LIMITS BY SECTOR)
--LESSEE CRITERIA
--EXPOSURE LIMITS PER CUSTOMER
--APPROVED VENDORS
65. LEASING APPROVAL PROCESS
EXAMPLE OF PROCESS FOR APPROVAL OF LEASING DEALS:
--PROPOSAL BY ORIGINATING UNIT, WHO RECOMMENDS
TERMS AND PRICING. INFORMATION ABOUT LESSEE,
EQUIPMENT, VENDOR ACCOMPANIES THE PROPOSAL.
--RISK ANALYSIS IS DONE BY CREDIT AND RISK UNIT
--EQUIPMENT ASSESSMENT (BY TECHNICAL MANAGER)
--LEGAL ASSESSMENT (BY LEGAL OFFICER OR COUNSEL)
THE PROPOSAL, AND THE ASSESSMENTS, ARE PRESENTED
TO THE APPROVAL COMMITTEE (THEN TO BOARD OF
DIRECTORS IF EXPOSURE IS ABOVE A STATED LIMIT)
THE APPROVAL COMMITTEE, IN APPROVING, ALSO
APPROVES (OR MODIFIED) THE TERMS TO BE OFFERED.
66. LEASING: RISK ANALYSIS PROCESS
THE RISK ANALYSIS PROCESS INCLUDES (A) LESSEE RISK,
(B) EQUIPMENT RISK AND (C) VENDOR RISK.
(A) TO ANALYZE LESSEE RISK:
--IDENTIFY THE PURPOSE OF THE DEAL (THE INTENDED USE
OF THE LEASED ASSET BY THE LESSEE)
--IDENTIFY THE SOURCE OF THE LEASE PAYMENTS:
- CASH FLOW FROM THE LESSEE’S BUSINESS
- NEW REVENUES FROM THE LEASED EQUIPMENT.
--FINANCIAL ANALYSIS OF THE LESSEE (LATEST FINANCIAL
STATEMENTS, FORECAST CASH FLOW)
--BUSINESS RISK ANALYSIS: SECTOR, PRODUCTS,
CUSTOMERS, CAPABILITY OF OWNERS AND MANAGERS
67. LEASING: RISK ANALYSIS PROCESS
(B) EQUIPMENT RISK—SOME KEY CONSIDERATIONS:
--WHERE AND BY WHOM IS THE EQUIPMENT PRODUCED ?
--WHO IMPORTS OR SUPPLIES THIS TYPE OF EQUIPMENT ?
--WHO USES THIS TYPE OF EQUIPMENT (OR COULD USE IT) IN OUR
COUNTRY ?
--WOULD THERE BE A MARKET FOR THIS EQUIPMENT (POTENTIAL
FUTURE BUYERS OR OTHER LESSEES) IN CASE IT IS RETURNED
TO US ? WHAT ARE MARKET VALUES FOR THIS EQUIPMENT IN
OUR MARKET (IF SOLD AS USED EQUIPMENT) ?
--WHAT IS LESSEE’S INTENDED USE OF THIS EQUIPMENT, AND
UNDER WHAT CONDITIONS WILL IT OPERATE?
--DOES THE EQUIPMENT HAVE A REPUTATION FOR RELIABILITY
AND DURABILITY ?
68. LEASING: RISK ANALYSIS PROCESS
(C) VENDOR RISK—SOME KEY CONSIDERATIONS:
--WHAT ARE THE PRODUCT WARRANTIES PROVIDED BY THE
MANUFACTURER ?
--WHAT ARE THE SERVICE, MAINTENANCE AND SPARE PARTS
SUPPORT FOR THE LEASED EQUIPMENT AND WILL THE VENDOR
PROVIDE IT ? (OR IF NOT, WHO WILL PROVIDE IT ?)
--ARE THE MANUFACTER AND THE VENDOR SUFFICIENTLY STABLE
AND RELIABLE TO BE ABLE TO PERFOM UNDER THEIR
WARRANTY AND THEIR SERVICE AND MAINTENANCE
AGREEMENTS FOR THE LIFE OF THE LEASE?
--IF A BUY-BACK AGREEMENT IS ANTICIPATED, DOES THE VENDOR
HAVE THE BUSINESS AND FINANCIAL STABILITY TO BE ABLE TO
HONOR A BUY-BACK AGREEMENT ?
--IF A REMARKETING AGREEMENT IS ANTICIPATED, DOES THE
VENDOR HAVE THE MARKET POSITION TO REPOSITION (SELL
OR LEASE) ANY RECOVERED EQUIPMENT QUICKLY ?
69. LEASING: RISK ANALYSIS PROCESS
OTHER RISKS TO BE CONSIDERED:
(D) LEGAL RISKS: ARE THERE ANY LEGAL OR REGULATORY
THREATS TO THE LESSEE’S BUSINESS OUTLOOK ?
(E) ECONOMIC AND SECTOR RISKS:
WHAT IS THE ECONOMIC OUTLOOK FOR THE LESSEE’S
SECTOR, OR FOR THE SECTORS OF ITS MAIN
CUSTOMERS ?
ARE THERE ANY ECONOMIC THREATS TO THOSE
SECTORS WHICH COULD AFFECT LESSEE’S CASH FLOW
AND ITS ABILITY TO MAKE LEASE PAYMENTS ?
70. LEASING: RISK ANALYSIS PROCESS
THERE ARE TRADEOFFS IN THE ANALYSIS OF RISKS:
--IF THE LESSEE IS ESPECIALLY STRONG, AND ENTERS INTO
A FINANCE LEASE WITH THE INTENT TO PURCHASE THE
EQUIPMENT, THEN EQUIPMENT AND VENDOR RISKS ARE
LESS CRITICAL TO THE OVERALL RISKS OF THE DEAL.
--FOR RELATIVELY SMALL OR START-UP LESSEES, THE
EQUIPMENT AND VENDOR RISKS ARE THE KEY FACTORS
IN DETERMINING WHETHER THE RISK IS ACCEPTABLE.
--FOR OPERATING LEASES, WHERE THERE ARE RESIDUAL
VALUES AND THE POSSIBILITY OF THE RETURN OF THE
LEASED ASSET, THE EQUIPMENT AND VENDOR RISK
CONSIDERATIONS ARE MORE CENTRAL TO THE DEAL
THAN FOR FINANCE LEASES.