What is direct leasing in financial leasing How to operate
Direct financial leasing is a tripartite transaction involving three parties - lessor, lessee and supplier, and at least two or more contracts - sale and purchase contracts and leasing contracts constitute a self-contained class, then know how to operate financial leasing?
Extended meaning
Direct financing lease (direct financing lease)
Direct financing lease refers to the leasing company with its own funds, bank loans or prospectus, etc., in the international or domestic financial market to raise funds to the equipment manufacturer to purchase the equipment required by the user. Equipment manufacturers to purchase the equipment required by the user, and then leased to the lessee enterprise to use a major financial leasing method. This kind of direct leasing method is directly met by the leasing parties, and the requirements and conditions of the three parties are very specific and clear. The direct leasing method has no time interval, the lessor has no equipment inventory, the flow of funds to accelerate, there is a high investment efficiency.
Direct financial leasing business analysis
By the lessor to use the funds raised in the capital market, to the manufacturer to pay the purchase price, the purchase of equipment and then leased directly to the user (lessee). The lease generally includes two contracts:
(1) the lessor and the lessee to sign a lease contract;
(2) the lessor in accordance with the lessee's order requirements, and the manufacturer to enter into a contract of sale.
In addition to the characteristics of a finance lease, a direct financial lease must meet the following two additional conditions:
(1) the lessor to the lessee to collect the rent (the minimum lease payment) is guaranteed and can be reasonably predicted;
(2) there is no significant uncertainty affecting the lessor's cost reimbursement. Such uncertainties include, for example, the lessor's promise to the lessee to provide extensive services for the leased asset, or a warranty that excludes obsolescence or obsolescence of the leased asset. The carrying value of the leased asset covered by such a lease, at the lease commencement date, is equal to its fair value.
The vast majority of leasing companies in economically developed countries commonly use the practice of direct financing leases. In China, large leasing companies with strong financial strength also use this approach.
Procedures of direct financial leasing
Direct financial leasing is a tripartite transaction that involves three parties - lessor, lessee and supplier, and consists of at least two or more contracts - purchase and sale contract and leasing contract - which constitute a self-contained class of tripartite transactions, and the business formalities can be divided into the following steps:
(1) The future lessee is the owner of the lease, and the future lessee is the owner of the lease, and the future lessee is the owner of the lease. ) The future lessee (user) according to their own needs to determine the proposed commissioning group leasing technology, equipment to the leasing agency to submit the following documents, proposed leasing commission:
1) project proposal and feasibility study report or design mission statement;
2) the user has the industrial and commercial registration documents and relevant accounting statements; 3) fill out the leasing power of attorney, and in accordance with the approval authority of the state, stamped with Application unit, the approval of the official seal of the unit; 4) by the leasing agency recognized by the security unit issued by the lessee to perform the lease contract to give security irrevocable letter of guarantee.
(2) the leasing agency to review the above documents, provide the user with a preliminary rental estimate, by the leasing agency of the project's benefits, the ability of the enterprise to repay and the guarantor's guarantee qualifications of the project's benefits, the enterprise's ability to repay and the guarantor's guarantee qualifications, etc. validation, approval, confirmation and consent, the internal establishment of the project, the external formal acceptance of the commission.
(3) Finalize the lease conditions with the user, formulate the estimated rental program, sign the lease contract, and confirm the guarantee with the seal of the economic guarantor.
(4) leasing agency together with the user and the supplier to conduct technical and commercial negotiations, negotiated conditions, by the leasing agency as the buyer, the user as a lessee, and the seller **** with the signing of the supply contract.
(5) the leasing agency to fulfill the purchase contract, payment, at the same time, the supplier delivery, user acceptance.
(6) notify the lessee of the lease contract formally start leasing the lessee of the enterprise according to the notice of the start of the lease to pay the rent on schedule.
(7) Lease expiration, the lessee enterprise can lease the equipment for the following options: nominal purchase, lease renewal or leasing equipment back to the leasing agency.
Business procedures for direct financial leasing
1. Selection of leasing equipment and its manufacturer
The lessee enterprise according to the project. Program requirements, to determine the required introduction of leasing equipment. Then select the manufacturer with good reputation and high product quality, and directly negotiate with it about the equipment specifications, models, performance, technical requirements, quantity, price, delivery date, quality assurance and after-sales service conditions. If the lessee lacks understanding of market conditions, the leasing company can also be used to identify leasing equipment and manufacturers.
2. Application for commissioned leasing
Lessees should first choose the leasing company. The main thing is to understand the leasing company's financing ability, scope of operation, financing rates and other relevant information. After selecting the leasing company, the lessee to apply for entrustment, fill out the "Lease Application Form" or "Lease Power of Attorney" to the leasing company, detailed information on the required equipment varieties, specifications, models, performance, price, supply units, scheduled delivery and leasing period, production arrangements, the projected economic benefits, the payment of rent of the source of funds and other matters. The leasing company after reviewing and agreeing to sign and stamp on the power of attorney, indicating formal acceptance of the commission.
3. Organization of technical and commercial negotiations, signed the purchase contract
In the case of the leasing company to participate in the lessee and the equipment manufacturers to conduct technical negotiations, including equipment modeling, quality assurance, spare parts delivery, technical training, installation and commissioning, as well as technical services and other aspects. At the same time, the leasing company and equipment manufacturers for business negotiations, mainly including the price of the equipment, pricing currency, transportation mode, delivery mode and other aspects. Tenant Jane signed a technical service agreement with the equipment manufacturer, the leasing company signed a purchase contract with the equipment manufacturer.
4. Signing of the lease contract
Leasing company and the lessee signed a lease contract, the main articles of the lease contract include: leasing objects, the ownership of leased objects, the lease term, rent and its changes, arbitration of disputes, as well as the rights and obligations of both parties to the lease, and so on. The signing of the lease contract indicates that the lessee has obtained the right to use the equipment, while the ownership of the equipment still belongs to the leasing company.
5. Financing and payment
The leasing company can use its own funds to purchase equipment, but if it is short of funds, it can be financed through financial institutions, or from the financial market to raise funds directly to the supplier to pay for the equipment payment and transportation and miscellaneous fees, etc.; also by the leasing company will first be provided with the money to the lessee unit, used to pre-payment of the purchase price, to be the equipment to goods receipt of invoices, then based on the actual payment settlement, transfer of the payment to the lessee, and then the lease agreement. And then according to the actual payment settlement, to equipment leasing.
6. Delivery and after-sales service
The supplying manufacturer will deliver the equipment to the leasing company in accordance with the provisions of the purchase contract, and then transfer it to the lessee, or hand it over to the lessee directly. The lessee issues to the leasing company? Leased equipment acceptance list? as a written proof that the lessee has received the leased equipment. The supplier manufacturer should send engineers and technicians to the factory for installation and commissioning, and acceptance by the lessee company.
7. Payment of rent and liquidation interest
The leasing company starts to calculate the starting date of the lease according to the equipment receipt issued by the lessee. Due to some costs that cannot be determined in advance (e.g., bank charges, freight and transportation insurance premiums, etc.), the leasing company adjusts the cost of the original estimate according to the actual costs incurred for each item after making the final payment and sends a letter of change of lease conditions to the user. The lessee company shall pay the rent according to the notice of change of lease conditions. The leasing company will then repay the loan and pay interest based on the financing contract signed with the financial institution with its income such as lease payments.
8. Transfer or renewal of lease
After the expiration of the lease term, the leasing company may transfer the ownership of the equipment to the lessee according to the provisions of the contract, or collect a small amount of rent to continue leasing. If the ownership of the equipment is transferred, the leasing company must issue to the lessee a ? Transfer of ownership of leased equipment? to prove that the ownership of the leased equipment has been vested in the lessee.
Accounting for Direct Finance Leases
The lessor's accounting can be done by both the net and gross methods. By the net method, the lessor should debit the lease receivable and estimated residual value account with the net investment of the lease and credit the fixed asset account on the lease commencement date. By the gross method, the total investment in the lease should be debited to the lease receivable and estimated residual value account, credited to the fixed assets and unrealized interest income account, and the unrealized interest income should be gradually transferred to the realized interest income in the future. It can be seen that the lessor has no profit or loss incurred on the lease commencement date. The lessee shall debit the lease asset and credit the lease payable and unrecognized interest expense at the lease commencement date based on the lower of the present value of the minimum lease payments and its fair value. Unrecognized interest expense shall be recognized in installments over the lease term. The lessee shall also depreciate the leased asset at a later date.
A basic process of accounting
(a) 1, the lease application, the lessor accepts, sign a financial lease contract, according to the price of equipment, transportation costs, installation and commissioning costs, insurance premiums, etc., and the present value of the lease payments payable (discount rate order: implicit interest rate, contract interest rate, the same period the bank lending rate) the lower of the value of the asset, debit ? Fixed assets Fixed assets under finance leases Debit the fixed assets under finance leases to the amount of unpaid interest payable. Unrecognized finance costs Credit the total amount of rent payable according to the schedule of the finance lease contract. Long-term payables Finance lease payable Accounts.
2, if the leased assets accounted for 30% of the total assets of the enterprise, you can recognize the carrying value of the assets according to the total amount of rent payable, debit ? Fixed assets Finance lease fixed assets? Accounts.
(b) At the time of signing the lease contract, the lessee should generally pay the lessor 20?30% of the subject matter of the lease as a lease deposit, debit ? Other receivables account, credited to ? Bank deposits? account. The security deposit is used to pay the last installment or installments of rent, debit ? Long-term payables Finance lease payable and credited to ? Other receivables account.
(3) During the lease term, the lessee pays the rent on time and debits ? Long-term payables Finance lease payable account, credited to ? Bank Deposit ? account. Recognize the portion of lease interest included in the lease payments as a current expense by debiting ? Finance costs and credit ? Unrecognized finance charges ? account.
(d) the lessee depreciation, divided into two cases:
1, the contract agreed to the end of the period will be the transfer of ownership of the subject matter of the lease, the lessee in accordance with the normal life of depreciation, debit ? Manufacturing costs? Administrative expenses, etc.? Accounts, credit? Accumulated depreciation Subject.
2, the contract can not be reasonably determined at the end of the period will be the transfer of ownership of the subject matter of the lease, the lessee according to the lease period and the normal life of the shorter depreciation (on the new equipment lease period is generally shorter than the normal life), that is, according to the lease depreciation, debit ? Manufacturing expenses Manufacturing overheads, administrative expenses, and other expenses Administrative expenses and administrative expenses, etc., and credit? Accumulated depreciation Subjects.
(e) the expiration of the lease, the lessee to obtain ownership of the subject matter of the lease, divided into two cases:
1, the lessee depreciated over the normal life of the asset, the net book value of the asset and the actual value of the asset should be generally consistent with the lessee does not need to reconcile the books to the nominal price of the goods to obtain ownership, debit ? Long-term accounts payable Finance lease payable account, credit ? Bank deposits? account, recognize the nominal purchase price as current expense, debit ? Finance costs account, credit ? Unrecognized finance costs account; at the same time, the ? Fixed assets under finance leases to Owned Fixed Assets The detailed account.
( 2 ) to the appraised value of the liquidation of the accounts, debit ? Fixed assets account, credited to ? Capital surplus? Accounts.
Second, examples
Example 1: the lessee intends to lease a new boat to the lessor, set the acquisition cost of the boat for 80 million, the normal depreciation of the boat for 20 years, the lease period of 3 years, the lease rate of 7% per annum, the annual recovery of the principal of 26,666,700 yuan per year, the end of the period the transfer of ownership, the handling fee of 100 yuan.
Borrow: fixed assets? Finance lease fixed assets 80 million
Unrecognized finance charges 11.201 million
Credit: Long-term accounts payable? Finance lease payable 91.201 million
Credit: Long-term payables? Finance lease payable 32,266.67 million Credit: Bank deposit 32,266.67 million Borrow: Long-term payables? Finance lease payable 30.4 million credit: bank deposit 30.4 million debit: long-term payable? Finance lease payable 2853.34 million credit: bank deposit 2853.34 million borrow: finance costs 373.337 million credit: unrecognized finance costs 373.337 million
4, according to the normal life depreciation (20 years), 4 million per year into the current year's costs, expenses, to make the following accounting entries;
Borrow: manufacturing overhead, operating expenses, Administrative expenses 4 million credit: accumulated depreciation 4 million
5, the expiration of the lease period, the net book value of assets and the actual value of assets should be generally consistent, the lessee does not need to adjust the accounts to the nominal price of the goods to obtain ownership, to make the following accounting entries;
Borrowing: Long-term payables ? Finance lease payable 0.01 million
Credit: bank deposits 0.01 million
6, at the same time will be ? Finance lease fixed assets? to Owned fixed assets? Detailed accounts, make the following accounting entries;
Borrow: fixed assets equipment 80 million credit: fixed assets? Finance Lease Fixed Assets 80 million
Analysis: In the lease contract is clear that the transfer of ownership, in the depreciation according to the normal life of the conditions:
3, when the expiration of the lease period, the lessee's fixed assets book value of 80 million, has been depreciated to 12 million, the net book value of 68 million (in the asset side of the balance sheet).
Example 2: the lessee intends to lease a new ship to the lessor, set the acquisition cost of the ship for 80 million, the ship's normal depreciation of 20 years, the lease term for 3 years, the lease rate of 7% per annum, the annual recovery of the principal of 266,667,000, (the date of signing the contract does not determine the expiration of the transfer of ownership, depreciation according to the lease period, in the ownership of the Supplemental Agreement to the expiry of the clear transfer of property rights to $ 100). .
1, signed a lease contract, the lessee according to the asset acquisition cost and the present value of the lease payment payable (discount rate is generally the contractual interest rate) lower account, PV = ( 2666.67 + 560 ) / ( 1 + 7% ) + ( 2666.67 + 373.33 ) / ( 1 + 7% ) + ( 2666.66 + 186.67 ) / ( 1 + 7% ) = 8000000000, the following accounting entries; ( contract date is not sure at the end of the transfer of ownership, depreciation is charged according to the lease term, ownership supplemental agreement to clarify the transfer of title at the end of $ 100 ) . Make the following accounting entries;
Borrow: fixed assets ? Finance lease fixed assets 80 million unrecognized financing costs 11.201 million credit: long-term accounts payable ? Finance lease payable 91.201 million
2, A, the first year to pay the lease principal and interest, received from the lessor of the lease invoice for the same amount, make the following accounting entries;
Borrow: long-term accounts payable? Finance lease payable 32,266.67 million credit: bank deposits 32,266.67 million
B, the second year to pay the principal and interest on the lease, received the lease invoice issued by the lessor of the same amount of lease, make the following accounting entries;
Borrow: Long-term accounts payable? Finance lease payable 30.4 million credit: bank deposits 30.4 million
C, the third year to pay the principal and interest on the lease, received the lease invoice issued by the lessor, make the following accounting entries;
Borrow: long-term accounts payable? Finance lease payable 2853.34 million credit: bank deposits 2853.34 million
3, in the lease period, the unrecognized financing costs (including the nominal price of goods) using the straight-line method of apportionment, recognized as expenses for the year, to make the following accounting entries;
Borrowing: finance costs 373.337 million credit: unrecognized financing costs 373.337 million
4, according to the lease term depreciation (), the lease term, the lease term, the lease term, the lease term, the lease term, the lease term and the lease payment, the lease term. 4, according to the lease period depreciation (3 years), 2666.67 million per year into the current year's costs, expenses, make the following accounting entries;
Borrow: manufacturing costs, operating expenses, administrative expenses 2666.67 million credit: Accumulated depreciation of 2666.67 million
5, the expiration of the lease period, the asset's net book value of 0,, to 100 yuan to obtain ownership, make the following accounting entries;
Borrow: non-operating expenses 0.01 million credit: bank deposits 0.01 million
6, the lessee depreciation according to the lease term, the net book value of assets (0) and the actual value of the assets is a huge difference, the lessee in the name of the liquidation can be assessed the value of the assets to assess the value of the accounts, set the assessed value of 60 million, to make the following accounting entries;
Borrow: fixed assets, equipment 60 million credit: capital surplus. Equipment 60 million credit: capital surplus 60 million at the same time to make the following offsetting entries; borrow: accumulated depreciation 80 million credit: fixed assets? Finance lease fixed assets 80 million analysis: in the lease contract is not clear transfer of ownership, in the depreciation according to the lease conditions:
1, the lease contract, the lessee's assets and liabilities in the asset side of the increase of 91,200,010,000 (fixed assets increased by 80,000,000, unrecognized financing costs increased by 11,200,010,000); the liability side of the increase of 25,040,100,000 (Long-term accounts payable increased by 91.2 million, and finance lease payable increased by 11.2 million) Finance lease payable increased by 91.201 million).
2, the lessee in the three-year lease period into the financial expenses 11.201 million, through depreciation into the manufacturing costs, and then into the cost of 80 million.
3, at the end of the period, the lessee after evaluation of the book value of fixed assets increased to 60 million (in the balance sheet assets), capital surplus increased by 60 million (in the balance sheet liabilities).
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