A way of acquiring the use of assets without incurring the initial purchase cost of the asset. The customer selects the asset they wish to use and engages a finance company to fund the purchase, allowing the customer to use the asset during the period of the lease. The finance company owns the asset and recovers the cost of the asset, the interest and their profit from periodic rental payments by the customer during the term of the agreement. When using a finance lease, the liability has to be included on the balance sheet and the customer can agree to purchase the asset at the end of the leasing period, when ownership of the asset will transfer to the customer. See also Hire Purchase and Lease, Operating.