AN ASSESSMENT OF ACCOUNTING SYSTEM IN THE LEASING INDUSTRY
USER'S INSTRUCTIONS: The project work you are about to view is on "an assessment of accounting system in the leasing industry". Please, sit back and study the below research material carefully. This project topic "an assessment of accounting system in the leasing industry" have complete 5(five) Chapters. The complete Project Material/writeup include: Abstract + Introduction + etc + Literature Review + methodology + etc + Conclusion + Recommendation + References/Bibliography.Our aim of providing this "an assessment of accounting system in the leasing industry" project research material is to reduce the stress of moving from one school library to another all in the name of searching for "an assessment of accounting system in the leasing industry" research materials. We are not encouraging any form of plagiarism. This service is legal because, all institutions permit their students to read previous projects, books, articles or papers while developing their own works.
TITLE PAGE
AN ASSESSMENT OF ACCOUNTING SYSTEM IN THE LEASING INDUSTRY
BY
---
EE/H2013/01430
DEPARTMENT OF ----
SCHOOL OF ---
INSTITUTE OF ---
DECEMBER,2018
APPROVAL PAGE
This is to certify that the research work, "an assessment of accounting system in the leasing industry" by ---, Reg. No. EE/H2007/01430 submitted in partial fulfillment of the requirement award of a Higher National Diploma on --- has been approved.
By
--- . ---
Supervisor Head of Department.
Signature………………. Signature……………….
……………………………….
---
External Invigilator
DEDICATION
This project is dedicated to Almighty God for his protection, kindness, strength over my life throughout the period and also to my --- for his financial support and moral care towards me.Also to my mentor --- for her academic advice she often gives to me. May Almighty God shield them from the peril of this world and bless their entire endeavour Amen.
ACKNOWLEDGEMENT
The successful completion of this project work could not have been a reality without the encouragement of my --- and other people. My immensely appreciation goes to my humble and able supervisor mr. --- for his kindness in supervising this project.
My warmest gratitude goes to my parents for their moral, spiritual and financial support throughout my study in this institution.
My appreciation goes to some of my lecturers among whom are Mr. ---, and Dr. ---. I also recognize the support of some of the staff of --- among whom are: The General Manager, Deputy General manager, the internal Auditor Mr. --- and the ---. Finally, my appreciation goes to my elder sister ---, my lovely friends mercy ---, ---, --- and many others who were quite helpful.
PROJECT DESCRIPTION: This work "an assessment of accounting system in the leasing industry" research material is a complete and well researched project material strictly for academic purposes, which has been approved by different Lecturers from different higher institutions. We made Preliminary pages, Abstract and Chapter one of "an assessment of accounting system in the leasing industry" visible for everyone, then the complete material on "an assessment of accounting system in the leasing industry" is to be ordered for. Happy viewing!!!
Leasing is an alternative source of finance in Nigeria, the importance of leasing in capital investment in the world over cannot be over emphasized, but is yet to take a firm root in Nigeria, this is because, this is because the syndrome of owning everything is still in vogue in the country, the credit evasive is still very high in Nigeria, this singular reason account t for the low patronage of leasing as an alternative source of finance in the country, leasing has many definitions, but the legal definition as given by the statement of accountancy no ii. Says“leasing is a contractual agreement between owner (lessor) and another party the (lessee)” which conveys to the lessor, the right to use the leased asset for a consideration, usually a periodic charge called rentals.
TABLE OF CONTENTS
Title page
Certified mail
Dedication
Acknowledgement
CHAPTER ONE
1.1 Background Of The Study
1.2 Statement Of The Problem
1.3 Research Question
1.4 Significance Of The Study
1.5 Scope Of The Study
1.6 limitations
1.7 Research Questions
1.8 Plan Of The Study
1.9 Definition Of Terms
Chapter Two
Literature Review
2.0 Introduction
2.1 The Meaning Of Leasing And Leasing Business
2.2 Preparation Of Final Account By The Lessor
2.3.1 The Operating Method Of Accounting In The Books Of The Lessee
2.3.2. Lessor’s Books
2.3.3 The Finance Method of Accounting in the Lessee’s Book.
2.4 Lease Business
2.5 Genesis Of Leasing
2.5.1 Development In The United Kingdom
2.52 Leasing In The Twentieth Century
2.6 Evaluation And Income Recognition
2.7 Project Appraisal Concept
CHAPTER THREE
3.0 Research Methodology
3.1 Historical Background Of John Holts
3.2 Population
3.3 Sample And Sampling Techniques
3.4 Method Of Data Collection
3.5 Method Of Data Analysis
CHAPTER FOUR
Data Analysis And Presentation Of Findings
4.0 Preamble.
4.1 Analysis Of Research Questionnaire
4.2 Age
4.3 Other Findings
4.4 Research Findings And Testing Of Hypothesis
4.5 Testing Of Hypothesis
CHAPTER FIVE
5.1 Summary.
5.2 Conclusion
5.2 Recommendations
Bibliography
CHAPTER ONE
1.1 BACKGROUND OF THE STUDY
Leasing is an alternative source of finance in Nigeria, the importance of leasing in capital investment in the world over cannot be over emphasized, but is yet to take a firm root in Nigeria, this is because, this is because the syndrome of owning everything is still in vogue in the country, the credit evasive is still very high in Nigeria, this singular reason account t for the low patronage of leasing as an alternative source of finance in the country, leasing has many definitions, but the legal definition as given by the statement of accountancy no ii. Says “leasing is a contractual agreement between owner (lessor) and another party the (lessee)” which conveys to the lessor, the right to use the leased asset for a consideration, usually a periodic charge called rentals.
As it can be seen from the above, the concept of leasing envisaged the separation of ownership from the economic use of an asset , this is a fundamental characteristics of leasing, all other features flows from the basic level, this form of credit level is totally different from other forms of finance because it only involve an exchange of asset for a periodic rental, since this form of credit is evolving, there is the need therefore for a standard evaluation and accounting system on the subject, this appreciation of leasing came to limelight in Nigeria in the early 80s, this was made possible because of the austerity measure introduced by the democratic administration of Sheu Shagari and the subsequent introduction of structural adjustment (SAP) in Nigeria being a Mono-cultured economy that depended wholly on crude oil for her revenue and the continuous fall of crude oil price in the international market, because of this, it then became imperative for business to source their capital investment and needs elsewhere.
The uncertainty which paraded the economy made it difficult for financial institutions to go into medium and long term credit financing. Hence, the appreciation of leasing by both lessor and the lessee, there are however two main categories of leasing:
- Operating leasing:- this is where the lessor while giving the lessees the use of basic properties retains practically all the risk, obligations and reward of ownership.
- Finance capital lease: - this is where the lessor transfers the risk of ownership and reward to the lessee who is obligated to pay such cost as insurance maintenance, and similar charges on the property.
FEATURES OF FINANCE LEASE (SASII)
- The lease is not concealable.
- The lessee assumes most of the risk and reward of ownership.
- The lease term covers substantially (80% or more) of the useful life of the asset.
- The lessee is responsible for repairs, maintenance and insurance of the assets.
- The lessor has the right of repossession when certain speculated contract conditions are breached.
1.2 STATEMENT OF THE PROBLEM
As it can be seen from the background of the study Hence, on accounting for lease, there are numerous problems of which some are:
- Cost of capital :- the cost of capital is difficult to determine because it depend on the capital structure of the lessor, if the cost of capital is high, then the rental may be prohibitive and vice – versa.
- Taxation: - the position of the lesser will impact significantly on the rental and the frequent charge may be an advantage to the lesser.
- Accounting treatment: - at times, the lease are not treated according to the classification i.e. operating lease being treated as a financial lease.
1.3 RESEARCH QUESTION
The primary purpose of this work entitled accounting system in the leasing industry, therefore, is to evaluate the adequacy of the treatment adopted by various leasing industries in the treatment of their accounting entries and in formation and how they merge accounting theory with practice as profit making organization.
The examination will indicate whether there is a slight variance in the accounting system adopted in reporting various leases.
1.4 SIGNIFICANCE OF THE STUDY
The significance of this research project is to enable one to appreciate the proper treatment of the various lease transaction in the financial record of leasing companies, the maintenance of proper accounting of financial records tends to improve the leasing service generally.
In all business endeavors, cost and time are of paramount importance, and has to be controlled at all time, the accounting system adopted will go a long way in controlling these items.
Finally, this work will ensure that the information provided by leasing companies in their financial statement can be evaluated and compared with other companies in the industry.
1.5 SCOPE OF THE STUDY
We do not intend to cover all the accounting system in leasing transactions business, our work is confined to accounting system in the leasing industry only, the scope of this work do not cover the following areas.
- Leasing agreement pertaining to exploitation or exploration of mineral resources such as Oil, gas, minerals and timber.
- Leases in favor of contractor financing the development of landed properties.
- Lease agreement relating to licensing of intellectual properties such as motion, pictures, video recordings, manuscripts, patients and copyrights.
1.6 LIMITATIONS
As we all now that no human effort to achieve a set of goals goes without difficulties, certain constraints were encountered in the course of carrying out this project and they are as follows:-
- Difficulty in collection of data: - this is due to the skeptic nature of human beings most especially those in competitive business towards the release of needed information; this may be caused by the constant fear of not willing to release trade secrets.
- Difficulty in identifying the contribution of leasing income in the financial statement of most companies engaged in leasing as an opportunity to take advantage of tax incentives.
- Prudential guide lines: - another limitation is that imposed by the central bank of Nigeria monetary and fiscal policy from year to year, popularly known as prudential guidelines.
1.7 RESEARCH QUESTIONS
The research study is designed to answer the following questions, after the completion of the study, the questions are:
- Does an assessment of accounting provide a framework for decision making in the leasing industry.
- Does assessment of accounting system has impact in the industry.
- Does an assessment of accounting leads to attainment of organizational goals in the industry.
- Does it impact on the overall objective of the industry
- Does it have impact on the profitability ratio of the industry?
1.8 PLAN OF THE STUDY
This section will contain the brief content of each chapter, chapter one will have the background of the study, statement of the research problem, purpose of the study, significance of the study, scope and limitations of the study research question, plan of the study, and the definition of various s terms.
Chapter two will treat the literature review of leasing business, meaning of leasing, genesis of leasing, and an evaluation of income recognition.
While chapter three will discuss the research method, research approach to the work, sources of information, reliability of data, sample , scope , time and finance.
Moreso, chapter four will discuss the analysis of data, presentation of data, profile of the respondents, work duration, other findings, research findings and testing of hypothesis,
Finally, chapter five will discuss summary, recommendations, conclusion and bibliography.
1.9 DEFINITION OF TERMS
1. Lease: - it is a contractual agreement between the owners (lessor) which conveys to the lessee to use the asset leased for an agreed period of time in return for a consideration usually periodic payment called rents.
2. Operating lease:- this is one in which the lessor while giving the lessee the use of the leased asset or property returns practically all the risk of obligation and reward of ownership.
3. Finance or capital lease: - this is one in which ownership risk and reward are transferred to the lessee who is obliged to pay such loss as insurance, maintenance and similar charges on the asset, usually, the agreement is not concealable.
A. Leverage lease:- this is a three party lease involving a lender and often a financial institution in addition to the usual lessor and lessee, the lender supplies in most cases the greater part of the purchased price of the leased asset.
B. sales type lease: - this is one where the dealer, (lessor) transfers substantially all the risks of ownership and benefit of the property to the lessee and at the inception of the lessee, the fair value of the leased property is greater or less than the carrying amount in the book of the lessor , resulting in a profit or loss to the lessee who is often a manufacturer or a dealer.
C. direct finance lease: - this is slightly different from the sales – type , the fair value of the leased asset is the same as its carrying amount to the lessor.
4. Sales and lease back: - it is the one in which the seller of the property leases it back from the buyer.
5. Bargain purchase option: - it is a provision in the leased agreement, granting the lessee the option to purchase the leased property for a minimal sum considered lower than the lucky prevailing fair value of the property at the time the option is exercisable.
6. Fair value :- it is the amount that can be realized upon the sale of the property in a free market and in an arms length transaction between knowledgeable parties.
7. Inception of lease :- it is the date that both parties agreed and make definite commitment to the principal lease agreement.
8. Initial direct lease cost: - the lessor who is directly attributable to the particular lease agreement incures the cost, the cost includes legal fees, documentation cost, stamp duty and commission.
9. Residual value of lease:- it is the estimated fair value of the leased asset at the end of the lease term.
10. Useful life of an asset:- the short of (A) at the pre- determined physical life and (B) the economic life during which it could be profitably employed in the operation of the enterprise.
11. Unguaranteed residual value:- it is the portion of the residual value of the leased asset that is not guaranteed by the lessee or guaranteed only by the third party related to the lessor.
12. Lease term:- it is the duration of the lease which may vary from few months to the entire life of the asset.
CHAPTER TWO: The chapter one of this work has been displayed above. The complete chapter two of "an assessment of accounting system in the leasing industry" is also available. Order full work to download. Chapter two of "an assessment of accounting system in the leasing industry" consists of the literature review. In this chapter all the related work on "an assessment of accounting system in the leasing industry" was reviewed.
CHAPTER THREE: The complete chapter three of "an assessment of accounting system in the leasing industry" is available. Order full work to download. Chapter three of "an assessment of accounting system in the leasing industry" consists of the methodology. In this chapter all the method used in carrying out this work was discussed.
CHAPTER FOUR: The complete chapter four of "an assessment of accounting system in the leasing industry" is available. Order full work to download. Chapter four of "an assessment of accounting system in the leasing industry" consists of all the test conducted during the work and the result gotten after the whole work
CHAPTER FIVE: The complete chapter five of design and construction of a "an assessment of accounting system in the leasing industry" is available. Order full work to download. Chapter five of "an assessment of accounting system in the leasing industry" consist of conclusion, recommendation and references.
To "DOWNLOAD" the complete material on this particular topic above click "HERE"
Do you want our Bank Accounts? please click HERE
To view other related topics click HERE
To "SUMMIT" new topic(s), develop a new topic OR you did not see your topic on our site but want to confirm the availiability of your topic click HERE
Do you want us to research your new topic? if yes, click "HERE"
Do you have any question concerning our post/services? click HERE for answers to your questions
For more information contact us through any of the following means:
Mobile No 
:+2348146561114 or +2347015391124 [Mr. Innocent]
Email address 
:engr4project@gmail.com
Watsapp No 
:+2348146561114
COUNTRIES THAT FOUND OUR SERVICES USEFUL
Australia, Botswana, Canada, Europe, Ghana, Ireland, India, Kenya, Liberia, Malaysia, Namibia, New Zealand, Nigeria, Pakistan, Philippines, Singapore, Sierra Leone, South Africa, Uganda, United States, United Kindom, Zambia, Zimbabwe, etc
Support: +234 8146561114 or +2347015391124
Watsapp No :+2348146561114
Email Address :engr4project@gmail.com
FOLLOW / VISIT US VIA:
