Leasing As A Form Of Financing
(A Case Study Of Onitsha)
Complete Leasing As A Form Of Financing Project Materials (Chapters 1 to 5):
Lease is an agreement whereby the lesser conveys to the lessee in return for rent the right to use an asset for an agreed period of time.
The rate of industrialization is very slow in the country, this may be attributed to many factors ranging from non availability of the huge capital outlay which involves and the prevalent credit squeeze and to this, our project is meant to direct the government to recognize the extent to which equipment leasing has contributed to cooperate financing and that if attention and assistance be given to the leasing industry, its role in the economic emancipation of Nigeria will be invaluable.
TABLE OF CONTENT
ii Title page
iii Approval page
iv Dedication
v Proposal
Table of content vi
CHAPTER ONE
Introduction 1
1.1 Background of the study 1
1.2 Statement of problems 2
1.3 Objectives of the study 3
1.4 Significance of the study 3
1.5 Limitation of the study 4
Reference 6
CHAPTER TWO
Review of related literature 7
CHAPTER THREE
Research Methodology 14
3.1 Sources of data 14
3.2 Method of data location 16
Reference 18
CHAPTER FOUR
Findings 19
CHAPTER FIVE
Recommendations and conclusion 20
5.1 Recommendations 20
5.2 Conclusions 21
Bibliography 22
INTRODUCTION
1.6 BACKGROUND OF THE STUDY
Lease is defined as an agreement where by the lessor conveys to the lessee in return for rent the right to use an asset for an agreed period of time.
Most writers believe that equipment leasing started in 1977, the year that bell telephone first rented in the united state. It is however clear from history and decided cases in the British House of Lords that there were some form of leasing in the 1930’s and 1804’s in Great Britain. There was however, no organized leasing business in Great Britain until 1960 when financial leasing was junded in the city of London as a new method of business finance.
In Nigeria, leasing is a little more 24years in existence. In the early days of independence, prior to the incidence of exchange controls in 1967, some equipment were leased to Nigerian lessees directly by British leasing company, following the imposition of stringent exchange control measures period which were necessary for conserve the countries foreign exchange reserves, this type of off-shore leasing arrangement was no longer possible.
1.7 STATEMENT OF PROBLEMS
Despite the enviable prospects of equipment leasing, it is still faced with some problems, which are of great concern to me, and one of the reasons for embarking on this project. The problems include:-
1. The absence of any legislation of specific codes of the operations of equipment leasing in Nigeria. Because of this the ELAN is proposing in leasing decree to form an integral part of the industrial policy for the country.
2. The absence or lack of any specific pronouncements on the tax treatment and uniform accounting standard for lessees.
3. The astronomical cost of equipment being leased due to the devaluation of the Naira.
4. The current restrictions on the total capital allowance climbable and method of determination of such claims.
5. The “Thinking out” of trained and experienced personnel is the problem of instability of economy. Equipment leasing is a risky business and so can only be Lucrative when the economy is buoyant and stable.
1.8 OBJECTIVES OF THE STUDY
(1) The research work will aim at finding out if equipment leasing has sufficiently contributed to corporate finance.
(2) The study will as well try to find out the benefits of equipment leasing.
(3) Also the research work is aimed at finding out the problems and prospect of equipment leasing both now and in the near future.
(4) Whether there is need to fix actual percentage of commercial bank fund to equipment leasing.
1.9 SIGNIFICANCE OF THE STUDY
We are aware of several suggestions about why a company should lease equipment rather than buy it. So of the reasons are sensible while some are not, at the end of the day a company should take a financing decision that optimizes shareholders value.
Actually, a lot has not been known of equipment leasing in Nigeria thus it is not very popular and still in its infancy despite the fact that the merchant banks under ELAN have in their lease portfolio N1 billion.
Therefore, the study of this project matter especially at this period when equipment leasing has been classified as a banking service under the 1990 credit policy guideless is of immense importance to the following group of persons:
1. Government
2. Individual
3. Lessors
4. Lessees
1.10 LIMITATION OF THE STUDY
The scope of my project covers the definition and classification of leases, Accounting treatment of lessees and lessors including income and expenses recognition and assets and liability reporting; treatment of specialized and complex leasing transaction including go these far because .
I could only go these far because of the following limitations.
1. LACK OF INFORMATION
The organization furnishing us with the necessary and required information did not give me all that I required because of the secrecy provision they have; it seriously limited my progress in this project. Also since the topic is partially new in most Nigerian merchant and commercial banks they could provide me with vitally little or no information as regards to the topic.
2. LACK OF FUNDS
I am really handicapped in terms of finance considering the fade that I am residing in Enugu and gathering information entails my travelling a lot which needed huge some of money.
3. TIME FACTOR
This is not left out left out either because since the time needed to produce the project is short for us to go as extensively as I could have so this limited my scope.
The introduction of Leasing As A Form Of Financing should start with the relevant background information of the study, clearly define the specific problem that it addresses, outline the main object, discuss the scope and any limitation that may affect the outcome of your findings
Literature Review of Leasing As A Form Of Financing should start with an overview of existing research, theoretical framework and identify any gaps in the existing literature and explain how it will address the gaps
Methodology of Leasing As A Form Of Financing should describe the overall design of your project, detail the methods and tools used to collect data explain the techniques used to analyse the collected data and discuss any ethical issues related to your project
Results should include presentation of findings and interpretation of results
The discussion section of Leasing As A Form Of Financing should Interpret the implications of your findings, address any limitations of your study and discuss the broader implications of your findings
The conclusion of Leasing As A Form Of Financing should include summarize the main results and conclusions of your project, provide recommendations based on your findings and offer any concluding remarks on the project.
References should List all the sources cited in Leasing As A Form Of Financing project by following the required citation style (e.g., APA, MLA, Chicago).
The appendices section should Include any additional materials that support your project (Leasing As A Form Of Financing) but are too detailed for the main chapters such as raw data, detailed calculations etc.