Finance Lease - Int'l Stds

nicolamcintosh
nicolamcintosh Registered Posts: 4 New contributor 🐸
Hi can anyone please advise what effect a finance lease has on owrking capital

Comments

  • jilt
    jilt Registered Posts: 2,903 Beyond epic contributor 🧙‍♂️
    Hi can anyone please advise what effect a finance lease has on owrking capital

    If its a finance lease then asset is recognised in the SoFP under non current assets and the amount capital amount payable under LT liabilities. The capital part of the monthly payments are then debited to this LT liability and the interest to the SoCI

    Hope that makes sense.
  • nicolamcintosh
    nicolamcintosh Registered Posts: 4 New contributor 🐸
    Hi thanks for coming back to me , is it only the dep'n element that is shown on the operating statement - the interest amount is <£1k so under policy isn't shown
  • jilt
    jilt Registered Posts: 2,903 Beyond epic contributor 🧙‍♂️
    Sorry run that one by me again. Don't know about this <£1k policy. Something new comes and bites me every b****y day!
  • nicolamcintosh
    nicolamcintosh Registered Posts: 4 New contributor 🐸
    ~Sorry, it's our company policy not to show anything less than £1000 on the statements, so we wouldn't show the interest pd on the operating statement.
  • jilt
    jilt Registered Posts: 2,903 Beyond epic contributor 🧙‍♂️
    Oh I see, nothing to do with the DFS exam, thank the lord!
  • nicolamcintosh
    nicolamcintosh Registered Posts: 4 New contributor 🐸
    No sorry, just a problem I've come across in work, thanks for coming back to me though
Privacy Policy