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Case Studies

Case Study #1
Captive Leasing Company

Portfolio Size    $3 million
Challenges
  • Delinquent sales tax filings
  • Incorrect sales tax rates being charged
  • Delinquent financial and tax reporting
  • Invoicing generated - but not always timely
  • Accounts receivable not being reconciled
  • Lease terminations/renewals not carefully tracked
ECS Solutions
  • Brought accounting up to date
  • Monthly financials now complete by 15th of following month
  • Brought sales tax up to date
  • All returns now filed on time
  • All leases entered on LeasePlus
  • Sales tax rates corrected using Taxware interface
  • LeasePlus providing useful management reports not previously available
  • Timely monthly invoicing
  • Monthly accounts receivable reports help company quickly follow-up on delinquent invoices
  • ECS provides useful leasing tips and information, including advising leasing company regarding preparation of annual income tax returns
Benefits
  • Overall enhancement of leasing company profitability
  • Investment in ECS leasing management services is less than the annual salary of one new college graduate

Case Study #2
Large Ticket Leasing Company

Portfolio Size    $8 million
Challenges
  • While able to maintain its own general ledger, this large ticket leasing company did not want to focus time or personnel on portfolio management responsibilities. It chose outsourcing for invoicing, accounts receivable management, sales and property tax preparation, maintenance of all depreciation and gross investment and residual schedules, and preparation of monthly earnings reports.
ECS Solutions
  • All leases invoiced by the 10th of each month
  • State tax registrations, sales taxes and property taxes prepared, using job tracking software to ensure timely filing of returns
  • Accounts receivable reports, adjusting journal entries to book new leases, and gross investment and earnings schedules forwarded to client by 10th of each month
  • Prepared annual income tax filings, including multiple state income tax returns, for various partnership and LLC entities related to client leasing company
Benefits
  • Company focuses on new business generation instead of day to day management of current portfolio
  • ECS available as resource for valuable leasing and financial information
Outcome
  • Ultimately, the company looked to ECS for assistance in structuring the sale of their leasing company, as well as to effect a smooth transition of the portfolio management responsibilities to the new parent company.

Case Study #3
Small Ticket Leasing Company/
Community Bank

Portfolio Size    $1 million
Challenges
  • This community bank is building a lease portfolio. With the capacity to maintain its own financial records and tax filings, the bank sought outsourcing for lease servicing, including invoicing, accounts receivable management, maintenance of depreciation, and preparation of gross investment and residual and monthly earnings reports
ECS Solutions
  • All information maintained in the LeasePlus portfolio management system
  • Leases invoiced for the 10th, 20th, and 30th of each month
  • ECS provides lease analysis reports, on request, to enhance bank's leasing decisions
  • New lease booking entered in LeasePlus; adjusting entries faxed back to the bank within one business day
  • Accounts receivable reports, depreciation schedules, sales tax summaries and other management reports prepared and sent via overnight delivery for receipt by the bank on last day of each month
Benefits
  • Client bank can concentrate on building its lease portfolio, knowing the lease servicing is being handled efficiently and cost-effectively
  • Reports are timely, which facilitates leasing department's ability to meet stringent bank reporting requirements
  • Monthly management reports provide useful, understandable information; flexible report designs provide exactly the information required in practical, functional format

Case Study #4
Court Appointed Expert

Challenges
  • Two parties were involved in litigation relating to the
    appropriate calculation of the tax benefits derived from numerous leasing transactions with an original equipment cost of $284,000,000. The two parties, one of which was to receive compensation from the other based on the actual tax benefits derived, had very different opinions of
    how to calculate this benefit. The Judge, not possessing the background necessary to make an informed ruling, chose to consult with a professional with the appropriate knowledge of and familiarity with both leasing transactions and tax laws, including alternative minimum tax, before making a ruling in this matter.
ECS Solutions
  • An ECS tax partner holding both CPA and CLP designations was selected by both parties to the lawsuit, and subsequently retained by the United States District Court, Southern District of New York, to hear the evidence and testimony of both parties to the litigation. As a court appointed "Special Master", this partner then prepared a report for the District Court outlining the tax benefits of the leasing transactions. After review of his report, the Judge ruled in accordance with its findings.

 

 

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