Finance lease information
We will require the following information for assessing an approval to borrow where a finance lease of less than $1 million is involved:
- Details of the lease amount(s).
- Details of the start date and expiry date for the equipment lease (or expected dates for the proposed leases).
- A schedule detailing the lease terms, ie. payment amounts, dates of payments, etc.
- Details of the additional revenue expected to be generated by the leased equipment and/or cost savings made.
- A description of any cost-benefit analysis that was conducted prior to the decision to enter into the leases.
- The reason(s) for acquiring the equipment by way of finance lease as opposed to entering into an operating lease or outright purchase.
- Details of how the lease(s) will impact on the institution's statement of financial position, statement of financial performance, statement of cashflows over the term of the lease(s).
- Any other comments the institution may wish to make in support of the need to enter into the finance lease.
Please note that currently we and the Secretary for Education treat finance and operating leases differently for borrowing approval purposes. Operating leases currently do not require approval. Institutions should follow the relevant accounting standards when determining how to classify a lease. It may also be useful to discuss any documentation with the institution’s auditors who would be able to confirm how these should be treated.
27 October 2009
23 July 2015