BLM14020 - Lease accounting: finance lease accounting: finance lessors: net cash investment

This manual is being updated to reflect FRS 102 (2024 amendments). For guidance on the tax treatment of accounts prepared under IFRS 16 or the revised FRS 102, please refer to pages within the BLM50000 chapter.

This page will be archived at the end of February 2026.

A finance lessor’s net cash investment in a lease at a point in time is defined in paragraph 23 of SSAP 21 as the amount of funds invested in a lease by a lessor, and comprises the cost of the asset plus or minus the following related payments or receipts:

  1. government or other grants receivable towards the purchase or use of the asset;
  2. rentals received;
  3. taxation payments and receipts, including the effect of capital allowances;
  4. residual values, if any, at the end of the lease term;
  5. interest payments (where applicable);
  6. interest received on cash surplus;
  7. profit taken out of the lease.