Finance Lease - Int'l Stds

nicolamcintoshnicolamcintosh Just JoinedRegistered Posts: 4
Hi can anyone please advise what effect a finance lease has on owrking capital

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  • jiltjilt Font Of All Knowledge Registered Posts: 2,903
    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.
  • nicolamcintoshnicolamcintosh Just Joined Registered Posts: 4
    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
  • jiltjilt Font Of All Knowledge Registered Posts: 2,903
    Sorry run that one by me again. Don't know about this <£1k policy. Something new comes and bites me every b****y day!
  • nicolamcintoshnicolamcintosh Just Joined Registered Posts: 4
    ~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.
  • jiltjilt Font Of All Knowledge Registered Posts: 2,903
    Oh I see, nothing to do with the DFS exam, thank the lord!
  • nicolamcintoshnicolamcintosh Just Joined Registered Posts: 4
    No sorry, just a problem I've come across in work, thanks for coming back to me though
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