Residual value guarantees

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Last Updated on 26/03/2021 by 75385885

Residual value guarantees are a components of lease payments (amounts expected to be payable by the lessee under residual-value-guarantees) together with:

  • fixed payments (including in-substance fixed payments), less any lease incentives receivable;
  • variable lease payments that depend on an index or a rate;
  • the exercise price of a purchase option (if the lessee is reasonably certain to exercise that option); and
  • payments of penalties for terminating the lease (if the lease term reflects the lessee exercising the option to terminate the lease).

Residual value guarantees