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Equipment Leasing Procedure

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Section 1 - Purpose

(1) This Procedure specifies the items of equipment acquired by the University of Newcastle (University) that must be financed via a leasing arrangement, and outlines the provisions for leasing arrangements.

(2) This Procedure should be read in conjunction with the Procurement Policy.

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Section 2 - Audience

(3) This Procedure should be read and understood by all staff, including staff of controlled entities, who use or administer leased equipment.

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Section 3 - Scope

(4) This Procedure applies to items of equipment that are obtained via a leasing arrangement on behalf of the University.

(5) This Procedure does not apply to:

  1. equipment acquired by staff via a novated lease through a salary sacrifice arrangement (Please see Salary Packaging Policy); or
  2. building or tenancy leasing arrangements. 
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Section 4 - Definitions

(6) In the context of this procedure:

  1. “University fleet vehicles” means vehicles, either owned or leased by the University, that are used for official University business;
  2. “lease”, “leasing arrangement” or “lease financing” means a financial arrangement between a leasing provider and the University that:
    1. requires the University to make periodical payments;
    2. allows the University to use the leased item; and
    3. assigns technical ownership of the item to the leasing provider for the duration of the financial arrangement.
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Section 5 - General Requirements

Leasing Decision

(7) The decision to commit the University to a leasing arrangement must be made in consultation between the delegated authority in the business unit and Financial Services (see Delegations Register).

(8) The decision to use leasing as a financing mechanism does not diminish the responsibility of University officers to exercise due diligence and care in relation to their day to day purchasing decisions.

Equipment to be Leased

(9) University staff must lease the following items of equipment through existing supply arrangements:

Equipment Type Equipment Items Standard Lease Term 
IT Equipment
(see also Clause 10 below)
Desktop Computers
Laptop computers, and associated bundled peripherals.
36 months
University Fleet Vehicles Standard passenger vehicles, as listed on the fleet vehicle catalogue. 60 months

(10) IT equipment purchased from grant funding cannot be leased.

(11) For University Fleet Vehicles funded from competitive (external) research grants, and where the conditions of the grant do not allow for the allocation of lease costs, the conditions of the grant that require the outright purchase of items will supersede this procedure.

(12) Financial Services will assess the purchase of the above items of equipment for projects where the duration is expected to be less than the standard lease term to determine which acquisition method will deliver the best value for money.

Other Equipment

(13) The University may consider a number of potential purchasing options when purchasing other equipment not listed in Clause 9, which may include lease financing.

(14) The most appropriate financing mechanism for the following equipment items will be assessed on a case by case basis and a decision made by Financial Services on which financial options will deliver the best value for money:

  1. non-standard IT equipment (including servers and specialised high end computer equipment);
  2. non-IT related equipment (including research related and specialised equipment);
  3. non-standard University fleet vehicles.

Leasing Provider

(15) Where the University currently maintains a Master Leasing Facility for a class of items, this facility must be used. All discussions with the provider regarding an existing lease facility should be directed through Financial Services in the first instance.

Return of Equipment

(16) Colleges and Divisions must ensure that all leased items are ready and available for return to the leasing provider prior to the lease expiry date, in line with directions provided by Financial Services.

(17) Leased equipment is not owned by the University and, therefore, must not be transferred outside of the University, sold, destroyed, or discarded.

Responsibilities

(18) Colleges and Divisions who are procuring equipment via a leasing arrangement are responsible for:

  1. adequate record management pertaining to the leasing arrangement and the leased item, in accordance with the Records and Information Management Policy;
  2. complying with the terms and conditions of the leasing arrangement;
  3. consulting with Financial Services regarding the lease, as required by this Procedure;
  4. maintaining a register of all leased items; and
  5. complying with all other requirements of this Procedure and any other related or associated policy or procedure. 
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Section 6 - IT Equipment

Care of IT Equipment and Asset Management

(19) All leased IT equipment must be maintained in good working order and not modified without the permission of Information Technology Services and Financial Services. All leased IT equipment will be asset managed through the leasing provider’s online system.

(20) Colleges and Divisions are to ensure that Financial Services are notified prior to any leased IT equipment being relocated or otherwise transferred within the University or to other staff.

(21) The leasing payments for all IT equipment leases must be met from the budget of the assigned business unit.

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Section 7 - University Fleet Vehicles

Care of Vehicles and Asset Management

(22) All leased University fleet vehicles must be maintained as per the manufacturer’s recommendations and not modified without the permission of Financial Services. All leased University fleet vehicles will be asset managed through the dedicated Fleet Management portal.

(23) Colleges and Divisions are to ensure that Financial Services are notified prior to any leased University fleet vehicle being relocated or otherwise transferred within the University.

(24) Each leased University fleet vehicle must be assigned to a business unit and a nominated vehicle custodian who will be responsible for the day to day management of the vehicle.

(25) All operating costs for leased University fleet vehicles must be met from the budget of the assigned business unit. This includes, but is not limited to:

  1. Fringe Benefits Tax;
  2. servicing and maintenance costs;
  3. fuel;
  4. registration costs;
  5. insurance excess;
  6. tollway charges; and
  7. excess kilometres and end of lease costs.

(26) The overall administration of statutory obligations relating to leased University fleet vehicles will be the responsibility of Financial Services.

(27) University fleet vehicles must be leased as new vehicles unless it can be identified that another business unit has a University fleet vehicle that is surplus to their needs. In this circumstance the University may assign the surplus vehicle to a business unit until the existing lease has expired.

(28) Please also see University Fleet Vehicle Use Procedure.