INVESTMENT IN LEASES AND LEASED EQUIPMENT - NET

9 Months Ended

Dec. 31, 2012

INVESTMENT IN LEASES AND LEASED EQUIPMENT - NET [Abstract]

INVESTMENT IN LEASES AND LEASED EQUIPMENT - NET

3. INVESTMENT IN LEASES AND LEASED EQUIPMENT—NET

Investment in leases and leased equipment—net consists of the following (in thousands):       

	December 31,		March 31,
	2012
Investment in direct financing and sales-type leases—net	$	76,439	$	95,460
Investment in operating lease equipment—net		24,877		20,514
	$	101,316	$	115,974

INVESTMENT IN DIRECT FINANCING AND SALES-TYPE LEASES—NET

Our investment in direct financing and sales-type leases—net consists of the following (in thousands):

	December 31,			March 31,
	2012
Minimum lease payments	$	77,382		$	99,747
Estimated unguaranteed residual value (1)		7,424			6,917
Initial direct costs, net of amortization (2)		602			797
Less:  Unearned lease income		(7,964	)		(10,665	)
Less:  Reserve for credit losses (3)		(1,005	)		(1,336	)
Investment in direct financing and sales-type leases—net	$	76,439		$	95,460

(1) Includes estimated unguaranteed residual values of $3,411 thousand and $1,700 thousand as of December 31, 2012 and March 31, 2012, respectively, for direct financing leases which have been sold and accounted for as sales under Codification Topic, Transfers and Servicing.

(2) Initial direct costs are shown net of amortization of $569 thousand and $512 thousand as of December 31, 2012 and March 31, 2012, respectively.

(3) For details on reserve for credit losses, refer to Note 5, "Reserves for Credit Losses."

Our net investment in direct financing and sales-type leases for certain lease agreements serves as collateral for non-recourse equipment notes. See Note 7, "Notes Payable and Credit Facility."

We enter into agreements to sell the financing receivable associated with certain notes receivables and investments in direct financing leases, which are accounted for as a sale under Codification Topic, Transfer and Servicing. We recognized a net gain for these sales of $2.7 million and $2.2 million in financing revenues in the unaudited condensed consolidated statement of operations for the three months ended December 31, 2012 and 2011, respectively, and $4.4 million and $3.2 million for the nine months ended December 31, 2012 and 2011, respectively. Total proceeds from these sales of financing receivables were $48.1 million and $25.8 million for the three months ended December 31, 2012 and 2011, respectively. Total proceeds from these sales were $91.5 million and $50.5 million for the nine months ended December 31, 2012 and 2011, respectively.

INVESTMENT IN OPERATING LEASE EQUIPMENT—NET

Investment in operating lease equipment—net primarily represents leases that do not qualify as direct financing leases. The components of the investment in operating lease equipment—net are as follows (in thousands):

	December 31,			March 31,
	2012
Cost of equipment under operating leases	$	46,793		$	44,487
Less:  Accumulated depreciation and amortization		(21,916	)		(23,973	)
Investment in operating lease equipment—net (1)	$	24,877		$	20,514

(1) Includes estimated unguaranteed residual values of $7,859 thousand and $7,802 thousand as of December 31, 2012 and March 31, 2012, respectively, for operating leases.