Archive for July, 2008
Sometimes during the course of our work, we need to determine whether a particular person is adjudged a bankrupt so what should we do?
We can go to the Director General of Insolvency (DGI) office and obtain a copy of search form for RM1. After filling up the form, the DGI will then send it over […]
Major Tax Amendments In Brunei Darussalam
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On 5 th March 2008, it was announced that there were certain major amendments to the Income Tax Act (Cap 35) effective from 1st January 2008
Of important concerns are the reduction of corporate tax rate, certain tax threshold for SMEs and the introduction of witholding tax. Previously, companies have been using management fee to […]
Sale And Leaseback-How To Determine whether it is A Finance Lease or Operating Lease
0 CommentsThe following are some criteria to classify a sale and leaseback transaction as an operating lease [IAS17.7-14(R.05)]:
A sale has genuinely occurred, where all major risks and rewards were transferred to the buyer;
The buyer (lessor) cannot transfer the leased asset back to the seller (lessee);
The lessee has no bargain repurchase option and the lessor assumes […]
Tabulate below are the characteristic that indicates it as a Finance lease:-
Transfer of ownership at the end of the lease term to a lessee [IAS17.10(a)(R.05)].
The lessee has a bargain purchase option [IAS17.10(b)(R.05)].
The lease term covers the major part of the asset’s economic life [IAS17.10(c)(R.05)].
Payments made by a lessee that are a substantial portion of a […]
Accounting Treatment For Finance Lease
0 CommentsSummarized below the basic accounting treatment for Finance Lease.
In The Books of Lessee
At the inception the lessee should recognize the lease as an asset and a liability at an amount equal to the fair value of the leased assets.
The liability for a leased asset should be presented separately in the balance sheet as a current […]
