On or off the balance sheet: does it matter?
“Any company worth its salt is reporting a corresponding liability within its accounts. I don’t see that whether contract hire is on- or off-balance sheet makes any difference to its viability.”
Adrian Harris, fleet manager, Pertemps
“The benefits of contract hire, notably no requirement for capital expenditure, outweigh any burden of on-balance sheet reporting from an accounting viewpoint.”
Tristan Campbell, fleet advisor, Chivas Brothers
“Being off-balance sheet is not a key driver when fleets come to choose contract hire. Publicly-listed companies already provide a note to accounts about their leased assets.”
Gerry Keaney, chief executive, BVRLA
“I cannot recall any organisation choosing contract hire because it is off-balance sheet – it is not the principal reason for choosing contract hire. The reason for choosing contract hire is because it is a smooth and efficient way to run a fleet.”
Nick Hardy, group marketing director, Ogilvie Fleet
“When vehicles are included on a company’s balance sheet, bankers will adjust the organisation’s credit score accordingly. That will impact on a company’s risk position and ultimately the amount of money it can borrow.”
Alastair Kendrick, tax director, MacIntyre Hudson
“The changes will not cause businesses which provide a fleet of cars via contract hire to switch from this form of funding because of the additional benefits that it brings, such as fixed budget costs.”
Dan Rees, senior manager – Deloitte Car Consulting, Deloitte
“Even if some companies do consider moving away from contract hire, I think they will still do business with their contract hire companies in order to retain access to the discounts and administration benefits that those organisations deliver.”
Colin Tourick, management consultant
“On- or off-balance sheet has never been highlighted as a prime reason for choosing a particular funding route outside of a handful of organisations that have specific individual reasons for having vehicles off balance sheet.”
David Rawlings, director, BCF Wessex Consultants
Alastair Kendrick - 02/01/2014 13:18
Sorry but depending on the value of the car being leased and its CO2 emissions there could be clear advantages of leasing a car on contract purchase to contract hire.