Statement of cash flows and finance lease, Part 2
Repayment of finance lease installments are cash outflows, because the cash flows from financing activities include, in particular, expenses incurred by the lessee to pay off liabilities under finance lease agreements.
These expenses are recognized under as Payment of liabilities under finance lease agreements. However, here you should present the installment amounts relating to payment of the capital, that is, without interest and fees, which are included in "Interest" position.
In the event that payment of the lease payments is made in a foreign currency, the repayment is recognized together with realized exchange rate differences.
Let us also remember that in case of a finance lease the lessee shall adjust the operating activities for depreciation ("Depreciation" with a plus sign).
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