FMPM 470 Leases (Excluding Real Property)

Intent

To set out the requirements regarding compliance and approvals for leasing.

Scope

Definitions (Related Glossary Terms)

Lease

Lease Custodian

Real Property

Policy

Requirements

• As a "Statutory Body - other than Local Government", the University is bound by the requirements of Leasing in the Queensland Public Sector - Policy Guidelines released by Queensland Treasury. Accordingly the following policy guidelines apply:

  • Queensland Treasury Corporation (QTC) must be invited to quote or tender on all University leasing applications;

  • the most cost effective financing option for the acquisition must be adopted;

  • where any operating lease has a total net present value of base lease rental payments in excess of $2 million then approval must be sought from the Treasurer under the State Borrowing Program;

  • where a "master" lease facility is in place, under which individual leases may be entered into by the University from time to time within a specified limit, and the limit exceeds $2 million then approval must be sought from the Treasurer under the State Borrowing Program; and

  • a finance lease is considered to be a borrowing.  If the lease is a finance lease then approval to enter into the lease must be sought under the State Borrowing Program from Treasury. In addition, FMPM 430: Policy - Borrowing requires the approval of Finance Committee and Council prior to negotiating borrowing arrangements.

• The approval to lease, must be granted by one of the following officers:

  • Deputy Director, Services and Resources

  • Chief Financial Officer

• The University will not enter into a leasing arrangement where the aggregate purchase cost of items is less than two hundred thousand dollars ($200,000).  This is referred to as the minimum leasing limit.

• The responsibility for ensuring that the University remains in compliance with the terms of the lease agreement resides with the Lease Custodian.

• The Chief Financial Officer is responsible for maintaining a register of leases, detailing:

  • the description of property covered by the lease;

  • the lessor's details including name and address;

  • the lease contract number;

  • the commencement and expiry dates of the lease;

  • the lease payment amounts;

  • a notation as to whether it is an operating or finance lease for accounting   purposes; and

  • a reference as to where a copy of the lease agreement is filed.

Related documents and legislation

Financial and Performance Management Standard 2009 (s25)

Statutory Bodies Financial Arrangements Act 1982 (s32, 33, 34 & 35)

Australian Accounting Standard (AASB) 117 Leases

Leasing in the Queensland Public Sector – Policy Guidelines 

For enquiries in relation to this FMPM Policy please contact farp.finance@jcu.edu.au

Administration

NOTE: Printed copies of this policy are uncontrolled, and currency can only be assured at the time of printing.

Approval Details

Revision History