Financial+Services

DISADVANTAGES OF EQUIPMENT FINANCE.

Where there are many advantages of equipment finance like commercial equipment finance, truck finance, Earth moving machinery by working with commercial finance brokers in Melbourne, here are some of disadvantages are also showing their faces in the crowd of benefits. Definitely a financer who is investing in a heavy duty and expensive equipment, he is also generating some profit by investing large amount, he is also worried for equipment as he takes the ownership and depreciation. Therefore some of limitations, are signed at the time of leasing equipment, which are as follows. 

 

  1. HIGHLY EXPENSIVE. 
    Monthly or yearly rentals are paid by the lessee to the lessor it also include a very good margin for lessor as he is the owner of the equipment and risk is also belonging to him. Hence most of the time it is considered that equipment financing is high cost financing. 
  2. RESTRICTIONS IN THE USAGE OF ASSET. 
    While signing the Equipment Finance Agreement, it is possible that the financer can include some utilization restricted of the financed equipment/asset. In such an instance, lessee will have to be careful for the restricted usage of the equipment/asset. Furthermore if in any case lessor’s financial position is going weak and noticed that soon the lessor will be bankrupted so the lessee could not arrange equipment very immediately for running his business activities. 
  3. PENALTIES. 
    Incase lessee is unable to generate profit with equipment financed, and breach the contract agreement before expiry so lessee has to pay penalty decided in agreement to lessor. It is a big advantage to lessee as he already did not generate any profit with equipment. 
  4. DEBT. 
    There is no appearance of lease in statement of financial position of an organization still from the point view of investors that it is a debt and they include leases while valuating business. 
  5. OWNERSHIP. 
    By equipment financing you do not own the equipment it means that you cannot rent it, transfer to someone, sell, or pledge it. It depends of the terms and condition if given in agreement that you can purchase the equipment (vary case to case). 
  6. MAINTENANCE COST. 
    During the lease period lessee has to bear the maintenance cost even if asset is not owned by lessee at the end of lease.  

At one side equipment financing is fruitful for the business growth due to low purchasing power of the company by financing such an equipment which is necessary for business growth to remain stable in the market competition, but the above mentioned disadvantages se also to considered while financing an equipment. Allover it depends on the business nature and owner wish that either he can manage profit by equipment financing or he will suffer from loss. For more information, please log on to https://www.atlasef.com.au/instant-finance/engineering-equipment/finance-equipment

Outsource Your Accounting-Related Work With These Tips!

Outsourcing provides a range of benefits for just about any business – no matter how large or small it is. From the cut down in expenses to the ability to save time, there are just so many advantages that it simply makes no sense to keep non-primary activities in-house. However, outsourcing must be with care and attention; here are some tips to help you get started:

  • Understand the nature of your business – to start with, when it comes to outsourcing accounting services, you should first be aware of the exact nature of your business. Depending on the type of business, the legal requirements will differ, and so will your needs with regards to specific accounting services. For example, audits and the like are annually required by law if the business is a public or private limited company. As such, understand what is expected from your business, as this is the first step to finding the accounting and bookkeeping services for your company.
    • Do not settle for the very service you find – when it comes to finding the right business accountant gold coast – or just about any other professional for your needs – comparison can make a difference in the quality of service you will ultimately get. There is a reason why you are supposed to look around before you settle on any one particular service. As such, instead of hiring the very first company you find, it would be ideal to search for a number of companies that meet your demands. If the first consultations do not give you an idea, there is also the option of trying each service for a brief period of time, which will definitely allow you to see the character of each company.
      • Do not rely on referrals alone – this point is more relevant to the smaller businesses and start-ups that rely on the referrals of friends and family for most of their needs (larger companies and businesses generally tend to have more connections and a larger network to rely upon). The point you should understand is that simply because your closest acquaintances claim that a specific service is good, this does not mean the service in question will fit your needs as well – unless of course, both of you have the same expectations and needs. As such, treat referrals just as you would with other services you find – try them out with an unbiased mind at first, before settling for anyone.
        • Inquire into their work practices – and of course, do not forget to ask about their work practices! Nowadays, technology can easily do most of the accounting and payroll-related work, which translates into lesser work for humans (and thus, fewer expenses and less time). Not to add, company records can give you an idea of their transparency and work ethic. For more information, please click here. tax-declare