Question 2. A school acquires an item of equipment that was not of a specialised nature. In accordance with IPSAS 13 'Leases' it is recognised as a finance lease, but there is no certainty that the school (as the lessee) will obtain ownership of the equipment by the end of the lease term. Depreciation of the equipment should be spread over:

The term of the lease

The useful life of the equipment

The shorter of the term of the lease or the useful life of the equipment

A period consistent with similar owned items of equipment