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Ministry of Justice of Ukraine

August 10, 2000

No. 487/4708

ORDER OF THE MINISTRY OF FINANCE OF UKRAINE

of July 28, 2000 No. 181

About approval of the National provision (standard) of the financial accounting 14 "Lease"

(as amended on 09-07-2021)

In pursuance of the Program of reforming of the system of financial accounting using international standards approved by the resolution of the Cabinet of Ministers of Ukraine of October 28, 1998 No. 1706, and according to articles 1 and 6 of the Law of Ukraine "About financial accounting and the financial reporting in Ukraine" PRIKAZYVAYU:

1. Approve the National provision (standard) of the financial accounting 14 "Lease" (further - the National provision (standard) 14) approved by Methodological council on financial accounting under the Ministry of Finance of Ukraine that is applied.

2. The national provision (standard) 14 becomes effective since October 1, 2000.

3. Recognize voided since October 1, 2000:

the order of the Ministry of Finance of Ukraine of July 25, 1995 No. 128 "About approval of the Instruction on accounting accounting of rent transactions", registered in the Ministry of Justice of Ukraine on August 2, 1995 at No. 273/809;

the order of the Ministry of Finance of Ukraine of March 6, 1998 No. 50 "About modification and amendments in the Instruction for financial accounting of rent transactions", registered in the Ministry of Justice of Ukraine on March 23, 1998 at No. 186/2626.

Deputy minister

V. V. Reguretsky

 

Approved by the order of the Ministry of Finance of Ukraine of July 28, 2000 No. 181

National provision (standard) of the financial accounting 14 "Lease"

General provisions

1. National provision (standard) of the financial accounting 14 "Lease" (further the National provision (standard) 14) determines methodological bases of forming in financial accounting of information on lease of non-current assets and its disclosure in the financial reporting.

2. Regulations of the National provision (standard) 14 are applied by the companies, the organizations and other legal entities (further - the companies) irrespective of patterns of ownership (except budgetary institutions and the companies which according to the legislation constitute the financial reporting under International Financial Reporting Standards).

3. The national provision (standard) 14 does not extend on:

1) the farmout agreements connected with investigation and use of the natural and similar not recreated resources (except for leases of the parcels of land);

2) agreements concerning use of copyright and related rights;

3) agreements concerning lease of single (complete) property complexes;

4) on assessment of biological assets - objects of lease, estimated at fair value, reduced by the expected expenses on the place of sale according to the National provision (standard) of the financial accounting 30 "Biological assets";

5) on assessment of objects of the investment real estate which are estimated at fair value according to the National provision (standard) of financial accounting 32 "Investment real estate" approved by the order of the Ministry of Finance of Ukraine of 02.07.2007 No. 779, registered in the Ministry of Justice of Ukraine 16.07.2007 for No. 823/14090.

4. Terms which are used in provisions (standards) of financial accounting have such value:

The guaranteed salvage value:

1) for the lessee - part of salvage value which is guaranteed to payment by the lessee or the related party;

2) for the lessor - part of salvage value which is guaranteed to payment by the lessee or the independent third party capable on the financial condition to answer on guarantee.

Minimum lease payments - the payments which are subject to payment by the lessee during lease term (less the cost of services and taxes, which are subject to payment to the lessor, and the unforeseen rent) increased:

1) for the lessee - on the amount of its guaranteed salvage value;

2) for the lessor - on the amount of its guaranteed salvage value.

In case of opportunity and intention of the lessee to acquire object of lease at the price, is lower than its fair value for date of acquisition, minimum lease payments are constituted from the minimum rent for all lease term and the amounts which should be paid according to the agreement on acquisition of object of lease.

The trouble-free farmout agreement - the farmout agreement for which the lessee on lease term commencement pays such amount of the rent which gives opportunity to the lessor to be sure of prolongation of lease term or which can be terminated only:

1) on permission of the lessor;

2) if there was certain unforeseen event;

3) in case of the conclusion the lessee of the new tenancy agreement of the same asset or instead of it another asset similar to destination with the same lessor;

Non-quaranteed salvage value - part of salvage value of object of lease which the lessor is not provided or guaranteed only by the related party.

The unforeseen rent - part of the rent which is not fixed by the specific amount and is calculated using indicators of others, than lease term (sales amount, use level, the inflation index and the prices, market rates of percent and so forth).

Lease - the agreement under which the lessee acquires right to use non-current asset for a fee during the term approved with the lessor.

Operating lease - lease another, than financial.

Rental rate of percent - percent rate at which the present cost of the amount of minimum lease payments and non-quaranteed salvage value is equal to fair value of object of finance lease on lease term commencement.

Lease term commencement - date which comes earlier: signature date of the farmout agreement or acceptance date parties of obligations of rather basic provisions of the tenancy agreement.

Percent rate on possible loans of the lessee - percent rate which the lessee would shall pay for similar lease or (if this indicator cannot be determined) rate of percent on loans for acquisition of similar asset (for the same term and with similar guarantee) in lease term commencement.

Lease term - the period of action of the trouble-free farmout agreement, and also the period of prolongation of this agreement caused in lease term commencement.

The sublease - the devolution agreement the lessee of the object leased by it in lease to the third party.

Finance lease - lease which provides transfer to the lessee of all risks and benefits connected with right to use and ownership of asset. Lease is considered financial in the presence of at least one of the stated below signs:

1) the lessee acquires the property right to leased asset after the termination of lease term;

2) the lessee has opportunity and intention to acquire object of lease at the price, the lowest than its fair value for date of acquisition;

3) the lease term constitutes the most part of useful life (operation) of object of lease;

4) the present cost of minimum lease payments from lease term commencement equals or exceeds fair value of object of lease;

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