Cash and Operating lease: Difference between pages

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1. ''Liquidity.''
An operating lease involves the lessee (user) paying rentals for the hire of an asset for a period of time which is normally substantially less than the asset’s full useful life.
The owner (lessor) retains the significant risks and rewards of ownership - usually including the responsibility for maintenance, insurance and the like, and enjoyment of a significant residual value of the asset at the end of the lease term.


The most liquid of current assets, cash represents money in hand - or in banks or other financial institutions - which is immediately available.
Under IAS 17 and SSAP 21, operating leases are accounted for 'off balance sheet' by the user of the asset.
 
This means that the obligations/liabilities to pay future lease instalments are only disclosed in the notes to the financial statements, not on the face of the balance sheet.
 
2. ''Money.''
 
Physical banknotes and coins.
 
 
3. ''Financial reporting - balance sheet - assets.''
 
The current asset reported, along with cash equivalents, as a single aggregated figure in the primary statements of financial position and statement of cash flows.


== See also ==
* [[ED 2010/9]]
* [[Finance lease]]
* [[IAS 17]]
* [[Lease]]
* [[SSAP 21]]




== See also ==
==Other links==
* [[Award in International Cash Management]]  (AwardICM)
*[http://www.treasurers.org/node/8924 A Lesson on leases, The Treasurer, April 2013]
* [[Balance sheet]]
* [[Blocked Cash]]
* [[Cash accounting]]
* [[Cash against documents]]
* [[Cash and cash equivalents]]
* [[Cash balance pension scheme]]
* [[Cash basis]]
* [[Cash book]]
* [[Cash box placing]]
* [[Cash burn rate]]
* [[Cash concentration]]
* [[Cash conversion cycle]]
* [[Cash conversion efficiency]]
* [[Cash cow]]
* [[Cash equivalent transfer value]]
* [[Cash equivalent value]]
* [[Cash equivalents]]
* [[Cash flow]]
* [[Cash flow at risk]]
* [[Cash flow exposure]]
* [[Cash flow hedge accounting]]
* [[Cash flow insolvent]]
* [[Cash flow management]]
* [[Cash flow statement]]
* [[Cash forecasting]]
* [[Cash-generating unit]]
* [[Cash management]]
* [[Cash management bank]]
* [[Cash market]]
* [[Cash placing]]
* [[Cash pool]]
* [[Cash pooling]]
* [[Cash positioning]]
* [[Cash reserves]]
* [[Cash settlement]]
* [[Cash shell]]
* [[Cash sweep]]
* [[Cash terms]]
* [[Certificate in International Cash Management]]  (CertICM)
* [[Current assets]]
* [[Discounted cash flow]]  (DCF)
* [[Financial reporting]]
* [[Free cash flow]]
* [[Funds]]
* [[Fungible]]
* [[Geared cash flow]]
* [[IAS 7]]
* [[Idle cash]]
* [[Incremental cash flows]]
* [[Legal tender]]
* [[Liquidity]]
* [[Liquidity risk]]
* [[Money]]
* [[Near cash]]
* [[Operating cash]]
* [[Order to cash cycle]]
* [[Payments and payment systems]]
* [[Petty cash]]
* [[Reserve cash]]
* [[Shareholders cash flow]]
* [[Statement of cash flows]]
* [[Statement of financial position]]
* [[Strategic cash]]
* [[Terminal cash]]
* [[Trapped cash]]
* [[Ungeared cash flow]]
* [[Wealth]]


[[Category:Cash_management]]
*[http://www.treasurers.org/node/8011 Operating lease accounting changes,The Treasurer.July 2012]

Revision as of 14:15, 2 October 2013

An operating lease involves the lessee (user) paying rentals for the hire of an asset for a period of time which is normally substantially less than the asset’s full useful life.

The owner (lessor) retains the significant risks and rewards of ownership - usually including the responsibility for maintenance, insurance and the like, and enjoyment of a significant residual value of the asset at the end of the lease term.

Under IAS 17 and SSAP 21, operating leases are accounted for 'off balance sheet' by the user of the asset. This means that the obligations/liabilities to pay future lease instalments are only disclosed in the notes to the financial statements, not on the face of the balance sheet.

See also


Other links

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