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Month: December 2020

Ninkasi Christmas Countdown

Posted on by Theo

We thought we’d do something a bit fun in the run up to Christmas and share what we’ve been enjoying over the festive period.

Day One – Theo is drinking Raspberry and Pomegranate Gin Liqueur from Bristol Distilling Co

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“I’m not the biggest beer drinker so glad that our equipment can be used by other drinks manufacturers. A great pink gin and can be mixed with Prosecco for a cheeky festive cocktail, can’t wait to try more from their range!”

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Favourite Christmas Song – All I Want for Christmas is You – Mariah Carey (obviously!)
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Day Two – George is drinking a Seriously Mixed Up Sour from Beatnikz in Manchester
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The guys at Beatnikz are really great and show a real passion for all of the beer that they brew. Their sours are both full bodied but also fruity, George says it tastes like drinking a big bag of grapes.
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Favourite Christmas Food – Pigs in Blankets
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Day Three – Paul’s dessert beer of choice is Milk Stout from Wiper & True.
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This beer is smooth, creamy and has so many wonderful flavours. Your mouth senses the chocolate and vanilla as it flows across your tongue. Not just a great beer, this is award winning stuff from the boys in Bristol.
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Favourite Christmas Present ever – Action Man with a parachute
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Day Four – Ollie is drinking one of the Christmas specials from BrewYork (Fairy tale of BrewYork).
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Ollie loves a great dark beer, and he thinks the guys at BrewYork brew some of the finest dark beers in the country – Ollie says it tastes like pudding in a cup.
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Are your presents before or after Christmas dinner? – Just continuous, they never stop, it’s all about the receiving.
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Day Five – James is drinking Crash from Salt!
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This is a regular beer in James’ house, he loves the fruity nature that the hops bring to the beer and the velvety mouthfeel that the beer creates. As you can see from the glassware, he’s a bit of a fan!
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Favourite Christmas Memory – Christmas’ in North Wales with my whole family as a kid
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Day Six – Liam is drinking Northbridge from Thornbridge, which is a 7.2% mountain IPA.
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It is hands down Liam’s all time favourite beer, it is smooth, easy drinking and tastes amazing.
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Favourite Christmas Movie – Die Hard

Christmas Brew Day

Posted on by James Lewis

At Ninkasi today, dressed up in our Christmas jumpers and Santa hats, today we had our last review of 2020 ahead of the Christmas Holidays.

We also had the opportunity to play with one of our rental products, the Pilot Brew Kit, and create our very own Christmas beer – a 7.2% ‘Big Bold Stout’.

George is a brewer by trade and our operations manager. We had a Pilot Kit sitting in the warehouse, so we thought why not use it to bring some Christmas cheer to everyone and in the process, learn all about the trials and tribulations our customers go through when brewing themselves.

Have fun out there guys, and remember….. keeeeeeep brewing!!

The Ninkasi Elves

Types of Finance Agreements

Posted on by Theo

A lot of our customers ask us how equipment finance works in the industry and the difference between the various finance options.

There are quite a lot of myths and misunderstanding, below is a simple guide which we hope will help you better understand the terms that finance companies use, and importantly the difference between them.

There are three main finance options offered in the United Kingdom, we have listed them below.

 

Operating Lease

With an operating lease, the lease will normally run for less than the economic life of the asset, as such the finance company (the lessor) will continue to have an economic interest in the asset. It is therefore expected that the asset will have a significant residual value at the end of the primary lease period.

The customer (lessee) gets to use the asset over the agreed lease/rental period, but the payments made do not cover the full economic life of the asset. As opposed to a finance lease where the full cost of the asset is charged over the life of the agreement.

An Operating lease is likely to also include other additional services, some examples of which would be realising procurement risks, the stocking of goods ‘off the shelf’, delivery/installation of items, insurance and replacing faulty goods from stock.

At the end of the lease period the lessee may have all/any of the following options:

  • Return the asset to the finance company
  • Continue to rent the asset in terms agreed in an extension period
  • Negotiate a custom deal with the finance company

With an Operating lease the assets remain on the lessor’s balance sheet and the rental is treated as a cost item in the lessee’s profit and loss.

A rental agreement is a form of Operating Lease.

 

Finance Lease

With a finance lease the finance provider (the lessor) buys a specific asset and rents it to the hirer (the lessee) for an agreed period.

The finance lease commits the lessee to make payments for the cost of the asset. As the asset is still owned by the finance company, the lessor manages the VAT and accounting principles for the agreement.

At the end of this period of leasing (usually called the primary hire period) there will normally be several possible options open to the hirer.

  • The hirer can sell the asset to a third party on behalf of the finance provider.
  • The asset can be returned to the finance provider
  • The hirer may enter a secondary hire period, typically for a “peppercorn” amount

Note – A lessor cannot give the lessee a documented right to purchase the asset at the end of the lease for a pre-determined value. This would change the lease into a hire purchase agreement changing the VAT and accounting treatment with negative cash flow implications for the lessee.

For more information about end of term options on a finance lease, please see this article.

 

Hire Purchase (sometimes called lease purchase)

The point of a hire purchase agreement is that the asset is on hire from the finance provider until the final payment, at which time the title passes to the hirer. As it is understood between both parties that title will pass to the hirer at the end of the initial agreement, a hire purchase agreement is treated as a purchase for tax purposes, accountancy, etc.

With a hire purchase agreement, the hirer is therefore required to pay all the VAT due on the asset purchase up front, in addition to any deposit required by the finance company.

The hirer must treat the asset as owned, so it must be shown on its balance sheet and depreciated in line with its usual accounting standards. Of course, this this has implications in terms of other borrowing or covenants that the bank may have on the business.

 

We hope that you found this article useful, and as always if you have any questions, please just speak to us.

 

James, Paul, Theo, George, Oli and Liam

The Ninkasi Team

 

You can read more about different finance products by following any of the links below:

https://www2.deloitte.com/uk/en/pages/audit/articles/ifrs-16-leases.html/

https://www.ukbusinessforums.co.uk/threads/finance-lease-for-van-ending-what-do-do.345456/

https://www.advanceleasing.co.uk/services/end-of-lease-services/

https://www.addleshawgoddard.com/en/insights/insights-briefings/2019/tax-and-structuring/vat-update-fmv-leases/

https://app.croneri.co.uk/feature-articles/buy-hp-finance-lease-or-operating-lease-introduction-accounting-and-taxhttps://maxxia.co.uk/asset-finance/finance-lease/

https://www.bermans.co.uk/asset-finance-publications/article1/

Please note that all information contained within these articles is produced as summary of our experiences and does not constitute financial advice. Any information contained within third parties’ documents are not attributable to Ninaksi Rentals and must be read at your own discretion. Ninkasi rentals always advise that independent financial advice should be taken before signing any financial documents.