Ecowise Annual Report 2007 - ecoWise Holdings Limited

Notes to FinancialStatements31 October 200723. FINANCE LEASES (Cont’d)Minimum Finance Presentpayments charges value$’000 $’000 $’000Company2007Minimum lease payments payable:Due within one year 31 (7) 24Due within 2 to 5 years 123 (25) 98Due after 5 years 41 (9) 32Total 195 (41) 154Net book value of plant and equipment under finance leases 85Minimum Finance Presentpayments charges value$’000 $’000 $’0002006Due within one year 31 (7) 24Due within 2 to 5 years 123 (25) 98Due after 5 years 72 (15) 57Total 226 (47) 179Net book value of plant and equipment under finance leases 104It is the group’s policy to lease certain of its plant and equipment under finance leases. The average lease term is 4years. The rate of interest for finance leases is about 2.57% to 6.25% (2006: 2.60% to 6.25% per year). There is anexposure to fair value interest risk because the interest rates are fixed at the contract date. All leases are on a fixedrepayment basis and no arrangements have been entered into for contingent rental payments. All lease obligations aredenominated in S$. The obligations under finance leases are secured by the lessor’s charge over the leased assets.The fair value of lease liabilities approximates the carrying value.81