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Vehicle Loan on employee's credit

There is a company vehicle that was financed on the Fleet Manager's personal credit. I'm not clear if it was his personal vehicle prior to being put in the fleet or not. The company assumed the monthly payments in January of this year. The prior accountant just classified the payments as a fleet expense. That doesn't seem right to me. What's the best way to handle this. I do not get monthly statements and have no idea how much is left on the loan.

Answers

Shana Wild
Title: Controller Consultant
Company: Tier One Services, LLC
(Controller Consultant, Tier One Services, LLC) |

Hello -

Assuming this is classified as an operating lease the expense should be recognized on the books on a straight line basis.

You may wish to ensure that the lease obligation is no longer in the employee's name. If it is there is a possibility that this would be considered compensation for the employee.

Please let me know if I can help?

Shana Wild
Title: Controller Consultant
Company: Tier One Services, LLC
(Controller Consultant, Tier One Services, LLC) |

Hello! Just reaching out to see if the information was helpful and if you have any additional questions?

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