SYNTHETIC LEASE Definition

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SYNTHETIC LEASE is a transaction that appears, from an accounting standpoint, as a lease, but as a loan from a tax standpoint; resulting in an off-balance sheet account of the financing and the tax benefits that accompany the financed asset.

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OPERATING INTEREST is the legal right to assets used to produce revenue, e.g., produce oil or gas from a well, accompanied by the responsibilities to pay production costs and assume the risks.

CURRENT FACE, in securities, is the current monthly remaining principal of a certificate computed by multiplying the original face value of the certificate by the current principal balance factor.

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