Elemis: Lease Pricing and Structuring Software
Developed by Access Information Services and Vinod Kothari.
ELEMIS is a menu driven, easy to use Lease/HP evaluation software. It is an extremely versatile tool for pricing and structuring of lease and hire-purchase transactions. It computes IRRs and post-tax IRRs, NPVs for various lease transactions, works out rental plans (equated or unequated) for different pre-tax or post-tax IRRs, works out the amortisation/capital recovery schedule, works out retrospective IRRs (based on historical performance of a lease), sensitivity to change in variables, etc. In short, it is a very comprehensive evaluation tool.
Elemis is very popular all over India - there are over 100 installations in India with clients ranging from the top-players in the industry (State Bank of India, Canara Bank, Apple Finance, Tata Finance, etc.) to medium and small enterprises. There are installations out of India as well.
It allows the user to input and store the financial details of a Lease/HP transaction, i.e. Cost, Down Payment, Commencement Date, Tenure, Periodicity, Payments in Advance/Arrears, Management Fee, Residual Value/Option Price, Security Deposit Details. Management Fees and Residual Value can be input either as amounts or percentages. Security Deposit can be with or without interest. If interest bearing the interest can be paid or retained. If retained it can be compounded or simple. The principal can be repaid in single or multiple, equal or unequal installments.
To assist in inputting data, pressing a function key call a pop-up a math. calculator. The result of the calculation can be transferred by a keystroke to the input field.
The user can
input a Targeted Post Tax or Pre Tax Financial or Accounting Internal Rate of Return (IRR) and back calculate rentals
OR input rentals or
the Lease rate(PMPT) for lease/ Add-on rate for HP
or
a flat rate
and calculate the Pre and Post Tax Financial and Accounting IRRs.
IRR, Rental and Lease/Add-on Rates can be structured or unstructured. Therefore virtually any form of payment schedule can be analyzed though ELEMIS.
ELEMIS can approximate the Weighted Average Cost of Capital based on the user's equity/debt structure.
ELEMIS gives you both Pre-tax and more importantly Post-Tax IRR's as well as the Pre-tax and Post-Tax Net Present Value's.(NPV). NPV's can be calculated using discount rates either taken from the Cost of Capital parameters or input by the user.
ELEMIS can use reinvestment rate(s) supplied by you to give you Modified IRR's to smooth the effects of reinvestment implicit in the IRR calculations.
ELEMIS allows modification of payment dates and amounts thereby calculating Retrospective IRR's i.e. giving accurate IRR's in terms of the actual cash flow amounts and dates.
ELEMIS can do a Sensitivity Analysis of IRR's/NPV's to reflect the impact of tax rates or discount rates changing over the tenure of the asset.
ELEMIS produces the Capital Recovery Schedule which enables you to split your rentals into its principal and interest components based on the actual rate of return. This is also internationally accepted depreciation accounting practice for lease transactions.
The Rental Schedule gives a list of dates and amounts due for rental payments for each asset.
ELEMIS reports on the Income and Capital Recovery for any period of the user's choice. The user has a choice of four methods for recognizing finance income.
To analyze the impact of Depreciation, ELEMIS gives an IT Depreciation Report giving Opening WDV, Depreciation for the Year and Closing WDV, asset wise for any particular year.
Using Debt-Equity Ratio and the Cost of Debt (either taken from the Cost of Capital parameters or input by the user) an asset wise Return on Equity/Net Worth report is available.
For requirements not covered by the existing reports ELEMIS has an Ad-Hoc Query facility which allows the user to create a report of his choice by defining both the conditions and the data content. This gives you an almost flexibility to cull any information from the data already input.
ELEMIS can calculate Lease Equalization details as per ICAI guidelines for an individual assets or all the assets depending on the Companies Act tax rates input by the user.
ELEMIS reports can be displayed on screen, sent to the printer or a text file or to a LOTUS 123 compatible text file for later use.
Tools:
ELEMIS has a Financial Calculator to make quick calculations of IRR, NPV, Present and Future Values, not restricted to Lease/HP cases but extending to any financial transaction.
Options to Transfer or Copy data are provide to assist in data transfer in case of branch
operations or where the data is required to be split over various sub directories.
A Setup Menu contains the specifications for the Default Sub directory, the Tax Rates, the Advance Tax Proportions and the method for calculating HP Finance Income and can be altered whenever necessary.
ELEMIS comes with a powerful on-line help facility which not only contains information on how to use the software but also a glossary of terms and assumptions.
ELEMIS is password protected to allow you to restrict access to your evaluation information.
Elemis is priced at Rs. 15000/- in India, and USD 750 out of India. It is mailed along with a detailed self-explanatory manual. The program files will take about 2 MB of disk space and the data files will take extra space depending on the data input and stored.
A demo version is priced at Rs. 500/- in India and USD 50 out of India. The demo version also is mailed along with the detailed manual.
For any further information, Devapriyo Ghose.
Or write to Vinod Kothari