Loans and placements (TALC 43)

A1A.321.

Loans and placements (TALC 43) is further classified into:

• finance leases (TALC 431);
• advances - concessional loans (TALC 432);
• advances other than concessional loans (TALC 433); and
• loans and placements not elsewhere classified (TALC 439).

A1A.322.

Finance leases (TALC 431) consists of contracts under which the lessor, as legal owner of the asset, conveys substantially all risks and rewards of ownership of the asset to the lessee.

A1A.323.

Advances - concessional loans (TALC 432) consists of loans with concessional interest rates.

A1A.324.

Advances other than concessional loans (TALC 433) consists of loans and other non-equity financial assets acquired for policy rather than for liquidity management purposes. As a general rule, all loans made by general government to other government bodies, except loans made by central borrowing authorities, are deemed to be for policy purposes.

Includes: Long and short-term loans, non-marketable debentures; and long and short term promissory agreements (bonds and bills) issued to public sector units for the purposes of achieving government policy objectives.

Excludes: Government equity in public corporations (classified to equity including contributed capital (TALC 424)); grants (classified to revenue from current grants and subsidies (ETF 1141, SDC) or revenue from capital grants (ETF 1151, SDC)); concessional loans (classified to advances – concessional loans (TALC 432)); investment for liquidity management and income generation purposes.

A1A.325.

Loans and placements not elsewhere classified (TALC 439) consists of financial instruments that are created when a creditor lends funds directly to a debtor and receives a non-negotiable document as evidence of the asset.

Includes: Overdrafts, mortgage loans; loans to finance trade credit and advances; claims on the IMF in the form of loans.

Excludes: Concessional loans (classified to advances - concessional loans (TALC 432)); trade credit and advances (classified to accounts receivable (TALC 452)); accounts receivable (classified to accounts receivable (TALC 452)); loans that have become negotiable from one holder to another and where there is evidence of secondary market trading (classified to debt securities (TALC 421)); financial assets created by finance leases (classified to finance leases (TALC 431)); loans acquired for policy rather than for liquidity management purposes (classified to advances other than concessional loans (TALC 433)).