Simple Leases

These contracts fall into the category “without implicit rate” according to IFRS 16 standard, that is to say the ones for which the underlying asset should be returned to the lessor at the end of the contract.

Information needed are the following ones:

  • Contract code
  • Contract name
  • Contract description
  • Type of asset (a list is proposed – we can create new categories if needed)
  • Operating level
  • Commencement date
  • Payment frequency (monthly, quarterly, annual, bimonthly, half yearly)
  • Duration (in months)
  • Rental charge
  • Annual incremental borrowing rate

eLease16 calculates the debt and the financial charges for each period, presents the debt repayment table so that after payment of all rental charges the due debt equals to zero.

The right-of-use underlying asset is amortized over the contract duration since the asset is returned to the lessor at the end, so the net book value should equals zero.

All calculation impacts are done over the entire duration of the contract, year per year (considering the closing date of the Entity ou BU). Calculations can be exported under Excel format.