| Budget Amount *help |
¥1,600,000 (Direct Cost: ¥1,600,000)
Fiscal Year 1989: ¥600,000 (Direct Cost: ¥600,000)
Fiscal Year 1988: ¥1,000,000 (Direct Cost: ¥1,000,000)
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| Research Abstract |
Major findings of this research are a character of the UNIDROIT Convention on International Financial Leasing arid social functions of leasing transaction.
The UNIDROIT Convention on International Financial Leasing was adopted in Ottawa on May 28,1988. A unique point of this convention is a user-protection- character, which is a result of the hard discussion between lessee- and lessor- countries in the diplomatic conference. Some points of user-protection-character of this convention are compulsory.
The most important social function of leasing transaction is tax avoidance. When a user purchases assets, he can enjoy depreciation during period of the life of assets described by law. When a user acquires the assets through leasing transaction, he can decide leasing period as he likes. In case he decides shorter period than the life of the assets described by law, rent is usually higher than the depreciation amount of the assets. Accordingly, the user can decrease the amount of his profits and save his tax. This saved tax is shared by the user and the lessor. In case the user chooses longer period than the life of the assets described by law, rent is usually lower than the depreciation amount of the assets. In this case, not the user but the lessor can decrease the amount of his profits and save his tax. This saved tax is also shared by user and the lessor. The latter type of leasing transaction is called as leveraged lease.
From the view point of accounting, the user can hide his substantial debt in accounting document in Japan. Although this practice is very problematic for investors and financiers, the above point is one of the main reasons why leasing transactions become popular in Japan.
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