our wholly owned subsidiary willis asset management limited ( “ willis asset management ” ) is focused on the engine management and consulting business . willis aeronautical services , inc. ( “ willis aero ” ) is a wholly-owned subsidiary whose primary focus is the sale of aircraft engine parts and materials through the acquisition or consignment of aircraft and engines . in 2011 we entered into an agreement with mitsui & co. , ltd. to participate in a joint venture formed as a dublin-based irish limited company , wmes , for the purpose of acquiring and leasing jet engines . each partner holds a fifty percent interest in the joint venture . wmes owns a lease portfolio of 36 engines and five aircraft with a net book value of $ 306.0 million at december 31 , 2019 . our investment in the joint venture was $ 44.1 million as of december 31 , 2019 . in 2014 we entered into an agreement with casc to participate in casc willis , a new joint venture based in shanghai , china . each partner holds a fifty percent interest in the joint venture . the company acquires and leases jet engines to chinese airlines and concentrates on meeting the fast growing demand for leased commercial aircraft engines and aviation assets in the people 's republic of china . during 2016 , casc was reorganized , with portions of its partnership interest in casc willis being transferred to three chinese airlines and another government-owned entity . the 2016 casc reorganization resulted in no voting structure change to the joint venture . casc 23 willis owned a lease portfolio of four engines with a net book value of $ 49.2 million as of december 31 , 2019 . our investment in the joint venture was $ 13.8 million as of december 31 , 2019 . we actively manage our portfolio and structure our leases to maximize the residual values of our leased assets . our leasing business focuses on popular stage iv commercial jet engines manufactured by cfmi , general electric , pratt & whitney , rolls royce and international aero engines . these engines are the most widely used engines in the world , powering airbus , boeing , bombardier and embraer aircraft . recent developments . currently , an independent committee established by our board of directors is reviewing and negotiating a proposal from our chief executive officer and largest investor ( individually and together with an entity controlled by him , the “ willis parties ” ) and our senior vice president , corporate development ( together with the willis parties , the “ group ” ) to acquire the company pursuant to a merger . the group has not yet submitted a complete proposal for consideration by the independent committee , including indicative financing terms . consummation of any merger transaction will be subject to approval by the independent committee of the terms of a complete proposal submitted for consideration as well as the execution of definitive merger documentation . there can be no assurance regarding the terms and details of any transaction , that any future proposal by the group will be made , that any proposal made by the group will be accepted by the independent committee or that any merger transaction will ultimately be consummated . critical accounting policies and estimates the preparation of our consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets , liabilities , revenues and expenses , and related disclosure of contingent assets and liabilities . on an ongoing basis , we evaluate our estimates , including those related to residual values , estimated asset lives , impairments and bad debts . we base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates under different assumptions or conditions . we believe the following critical accounting policies , grouped by our activities , affect our more significant judgments and estimates used in the preparation of our consolidated financial statements : leasing related activities . revenue from leasing of aircraft equipment is recognized as operating lease revenue on a straight-line basis over the terms of the applicable lease agreements . where collection can not be reasonably assured , for example , upon a lessee bankruptcy , we do not recognize revenue until cash is received . we also estimate and charge to income a provision for bad debts based on our experience in the business and with each specific customer and the level of past due accounts . the financial condition of our customers may deteriorate and result in actual losses exceeding the estimated allowances . in addition , any deterioration in the financial condition of our customers may adversely affect future lease revenues . as of december 31 , 2019 , all of our engine leases are accounted for as operating leases with the exception of two leases entered into during the first quarter of 2019 which are classified as notes receivable under asu 2016-02. under an operating lease , we retain title to the leased equipment , thereby retaining the potential benefit and assuming the risk of the residual value of the leased equipment . we generally depreciate engines on a straight-line basis over 15 years to a 55 % residual value . aircraft and airframes are generally depreciated on a straight-line basis over 13 to 20 years to a 15 % to 17 % residual value . other leased parts and equipment are generally depreciated on a straight-line basis over 14 to 15 years to a 25 % residual value . story_separator_special_tag after adjustment for interest rate derivative instruments , $ 197.0 million and $ 327.0 million , respectively , was tied to one-month libor . as of december 31 , 2019 and 2018 , the company held $ 200 million and $ 100 million of interest rate derivative instruments on this debt . as of december 31 , 2019 and 2018 one-month libor was 1.76 % and 2.50 % , respectively . income taxes . income tax expense for the year ended december 31 , 2019 increased to $ 22.0 million from $ 13.0 million for the comparable period in 2018 . the effective tax rate for the years ended december 31 , 2019 and december 31 , 2018 was 24.7 % and 23.2 % , respectively . the increase in the effective tax rate was predominantly due to non-deductible officer compensation and state taxes . 26 financial position , liquidity and capital resources at december 31 , 2019 , the company had $ 63.7 million of cash , cash equivalents and restricted cash . at december 31 , 2019 , $ 4.7 million in cash and cash equivalents and restricted cash were held in foreign subsidiaries . we do not intend to repatriate the funds held in foreign subsidiaries to the united states . in the event that we decide to repatriate these funds to the united states , we would be required to accrue and pay taxes upon the repatriation . we finance our growth through borrowings secured by our equipment lease portfolio . cash of approximately $ 340.1 million and $ 759.4 million in the years ended december 31 , 2019 and 2018 , respectively , was derived from this borrowing activity . in these same time periods $ 428.1 million and $ 504.8 million , respectively , was used to pay down related debt . preferred stock dividends in october 2016 , the company sold and issued to development bank of japan inc. ( “ dbj ” ) an aggregate of 1,000,000 shares of the company 's 6.5 % series a preferred stock , $ 0.01 par value per share ( the “ series a preferred stock ” ) at a purchase price of $ 20.00 per share . the net proceeds to the company after deducting investor fees were $ 19.8 million . in september 2017 , the company sold and issued to dbj an aggregate of 1,500,000 shares of the company 's 6.5 % series a-2 preferred stock , $ 0.01 par value per share ( the “ series a-2 preferred stock ” ) at a purchase price of $ 20.00 per share . the net proceeds to the company after deducting issuance costs were $ 29.7 million . the company 's series a-1 preferred stock and series a-2 preferred stock accrue quarterly dividends at the rate per annum of 6.5 % per share . during the years ended december 31 , 2019 and 2018 , the company paid total dividends of $ 3.3 million on the series a-1 and series a-2 preferred stock , respectively . cash flows discussion story_separator_special_tag style= `` font-family : inherit ; font-size:10pt ; `` > , with a remaining term of 16 months as of december 31 , 2019 . in october 2019 , the company entered into an additional fixed-rate interest swap agreement which has a notional outstanding amount of $ 100.0 million , with a remaining term of 54 months as of december 31 , 2019 . the net fair value of the swaps was a $ 1.7 million net liability and a $ 1.7 million net asset at december 31 , 2019 and 2018 , respectively . we record derivative instruments at fair value as either an asset or liability . we have used derivative instruments ( primarily interest rate swaps ) to manage the risk of interest rate fluctuation . while substantially all our derivative transactions are entered into for the purposes described above , hedge accounting is only applied where specific criteria have been met and it is practicable to do so . in order to apply hedge accounting , the transaction must be designated as a hedge and the hedge relationship must be highly effective . the hedging instrument 's effectiveness is assessed utilizing regression analysis at the inception of the hedge and on at least a quarterly basis throughout its life . all of the transactions that we have designated as hedges are accounted for as cash flow hedges . the effective portion of the gain or loss on a derivative instrument designated as a cash flow hedge is reported as a component of other comprehensive income and is reclassified into earnings in the period during which the transaction being hedged affects earnings . the ineffective portion of these hedges flows through earnings in the current period . the hedge accounting for these derivative instrument arrangements adjusted interest expense by $ 0.7 million and $ 0.4 million for the years ended december 31 , 2019 and 2018 , respectively . this incremental benefit for the swaps effective for hedge accounting was included in interest expense for the respective periods . for any interest rate swaps that we enter into , we will be exposed to risk in the event of non-performance of the interest rate hedge counter-parties . we anticipate that we may hedge additional amounts of our floating rate debt in the future . related party transactions stock buybacks on september 12 , 2018 , in a transaction approved by a special committee of the board of directors , the company purchased 88,000 shares of common stock directly from the company 's chief executive officer , charles f. willis . the agreed and paid price per share was $ 34.2972 , the volume weighted average price on september 12 , 2018. joint ventures “ other revenue ” on the consolidated statement of income includes management fees earned of $ 2.9 million and $ 2.6 million during the years ended december 31

cash flows provided by operating activities were $ 230.3 million and $ 188.7 million in the years ended december 31 , 2019 and 2018 , respectively . cash flows from operations are driven significantly by payments made under our lease agreements , which comprise lease revenue , security deposits and maintenance reserves , and are offset by interest expense and general and administrative costs . cash received as maintenance reserve payments for some of our engines on lease are partially restricted by our debt arrangements . the lease revenue stream , in the short-term , is at fixed rates while a portion of our debt is at variable rates . if interest rates increase , it is unlikely we could increase lease rates in the short term and this would cause a reduction in our earnings and operating cash flows . revenue and maintenance reserves are also affected by the amount of equipment off lease . approximately 86 % and 88 % , by book value , of our assets were on-lease as of december 31 , 2019 and december 31 , 2018 , respectively . the average utilization rate for the year ended december 31 , 2019 and 2018 was approximately 88 % and 89 % , respectively . if there is an increase in off-lease rates or deterioration in lease rates that are not offset by reductions in interest rates , there will be a negative impact on earnings and cash flows from operations . distributions received from our investment in wmes were $ 3.3 million and $ 5.7 million in the years ended december 31 , 2019 and 2018 , respectively . cash flows used in investing activities were $ 147.4 million and $ 380.5 million in the years ended december 31 , 2019 and 2018 , respectively . our primary use of funds is for the purchase of equipment for lease and for sale . purchases of equipment ( including capitalized costs and prepaid deposits ) totaled $ 289.4 million and $ 441.4 million for the years ended december 31 , 2019 and 2018 , respectively .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```cash flows provided by operating activities were $ 230.3 million and $ 188.7 million in the years ended december 31 , 2019 and 2018 , respectively . cash flows from operations are driven significantly by payments made under our lease agreements , which comprise lease revenue , security deposits and maintenance reserves , and are offset by interest expense and general and administrative costs . cash received as maintenance reserve payments for some of our engines on lease are partially restricted by our debt arrangements . the lease revenue stream , in the short-term , is at fixed rates while a portion of our debt is at variable rates . if interest rates increase , it is unlikely we could increase lease rates in the short term and this would cause a reduction in our earnings and operating cash flows . revenue and maintenance reserves are also affected by the amount of equipment off lease . approximately 86 % and 88 % , by book value , of our assets were on-lease as of december 31 , 2019 and december 31 , 2018 , respectively . the average utilization rate for the year ended december 31 , 2019 and 2018 was approximately 88 % and 89 % , respectively . if there is an increase in off-lease rates or deterioration in lease rates that are not offset by reductions in interest rates , there will be a negative impact on earnings and cash flows from operations . distributions received from our investment in wmes were $ 3.3 million and $ 5.7 million in the years ended december 31 , 2019 and 2018 , respectively . cash flows used in investing activities were $ 147.4 million and $ 380.5 million in the years ended december 31 , 2019 and 2018 , respectively . our primary use of funds is for the purchase of equipment for lease and for sale . purchases of equipment ( including capitalized costs and prepaid deposits ) totaled $ 289.4 million and $ 441.4 million for the years ended december 31 , 2019 and 2018 , respectively .
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 Suspicious Activity Report : our wholly owned subsidiary willis asset management limited ( “ willis asset management ” ) is focused on the engine management and consulting business . willis aeronautical services , inc. ( “ willis aero ” ) is a wholly-owned subsidiary whose primary focus is the sale of aircraft engine parts and materials through the acquisition or consignment of aircraft and engines . in 2011 we entered into an agreement with mitsui & co. , ltd. to participate in a joint venture formed as a dublin-based irish limited company , wmes , for the purpose of acquiring and leasing jet engines . each partner holds a fifty percent interest in the joint venture . wmes owns a lease portfolio of 36 engines and five aircraft with a net book value of $ 306.0 million at december 31 , 2019 . our investment in the joint venture was $ 44.1 million as of december 31 , 2019 . in 2014 we entered into an agreement with casc to participate in casc willis , a new joint venture based in shanghai , china . each partner holds a fifty percent interest in the joint venture . the company acquires and leases jet engines to chinese airlines and concentrates on meeting the fast growing demand for leased commercial aircraft engines and aviation assets in the people 's republic of china . during 2016 , casc was reorganized , with portions of its partnership interest in casc willis being transferred to three chinese airlines and another government-owned entity . the 2016 casc reorganization resulted in no voting structure change to the joint venture . casc 23 willis owned a lease portfolio of four engines with a net book value of $ 49.2 million as of december 31 , 2019 . our investment in the joint venture was $ 13.8 million as of december 31 , 2019 . we actively manage our portfolio and structure our leases to maximize the residual values of our leased assets . our leasing business focuses on popular stage iv commercial jet engines manufactured by cfmi , general electric , pratt & whitney , rolls royce and international aero engines . these engines are the most widely used engines in the world , powering airbus , boeing , bombardier and embraer aircraft . recent developments . currently , an independent committee established by our board of directors is reviewing and negotiating a proposal from our chief executive officer and largest investor ( individually and together with an entity controlled by him , the “ willis parties ” ) and our senior vice president , corporate development ( together with the willis parties , the “ group ” ) to acquire the company pursuant to a merger . the group has not yet submitted a complete proposal for consideration by the independent committee , including indicative financing terms . consummation of any merger transaction will be subject to approval by the independent committee of the terms of a complete proposal submitted for consideration as well as the execution of definitive merger documentation . there can be no assurance regarding the terms and details of any transaction , that any future proposal by the group will be made , that any proposal made by the group will be accepted by the independent committee or that any merger transaction will ultimately be consummated . critical accounting policies and estimates the preparation of our consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets , liabilities , revenues and expenses , and related disclosure of contingent assets and liabilities . on an ongoing basis , we evaluate our estimates , including those related to residual values , estimated asset lives , impairments and bad debts . we base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates under different assumptions or conditions . we believe the following critical accounting policies , grouped by our activities , affect our more significant judgments and estimates used in the preparation of our consolidated financial statements : leasing related activities . revenue from leasing of aircraft equipment is recognized as operating lease revenue on a straight-line basis over the terms of the applicable lease agreements . where collection can not be reasonably assured , for example , upon a lessee bankruptcy , we do not recognize revenue until cash is received . we also estimate and charge to income a provision for bad debts based on our experience in the business and with each specific customer and the level of past due accounts . the financial condition of our customers may deteriorate and result in actual losses exceeding the estimated allowances . in addition , any deterioration in the financial condition of our customers may adversely affect future lease revenues . as of december 31 , 2019 , all of our engine leases are accounted for as operating leases with the exception of two leases entered into during the first quarter of 2019 which are classified as notes receivable under asu 2016-02. under an operating lease , we retain title to the leased equipment , thereby retaining the potential benefit and assuming the risk of the residual value of the leased equipment . we generally depreciate engines on a straight-line basis over 15 years to a 55 % residual value . aircraft and airframes are generally depreciated on a straight-line basis over 13 to 20 years to a 15 % to 17 % residual value . other leased parts and equipment are generally depreciated on a straight-line basis over 14 to 15 years to a 25 % residual value . story_separator_special_tag after adjustment for interest rate derivative instruments , $ 197.0 million and $ 327.0 million , respectively , was tied to one-month libor . as of december 31 , 2019 and 2018 , the company held $ 200 million and $ 100 million of interest rate derivative instruments on this debt . as of december 31 , 2019 and 2018 one-month libor was 1.76 % and 2.50 % , respectively . income taxes . income tax expense for the year ended december 31 , 2019 increased to $ 22.0 million from $ 13.0 million for the comparable period in 2018 . the effective tax rate for the years ended december 31 , 2019 and december 31 , 2018 was 24.7 % and 23.2 % , respectively . the increase in the effective tax rate was predominantly due to non-deductible officer compensation and state taxes . 26 financial position , liquidity and capital resources at december 31 , 2019 , the company had $ 63.7 million of cash , cash equivalents and restricted cash . at december 31 , 2019 , $ 4.7 million in cash and cash equivalents and restricted cash were held in foreign subsidiaries . we do not intend to repatriate the funds held in foreign subsidiaries to the united states . in the event that we decide to repatriate these funds to the united states , we would be required to accrue and pay taxes upon the repatriation . we finance our growth through borrowings secured by our equipment lease portfolio . cash of approximately $ 340.1 million and $ 759.4 million in the years ended december 31 , 2019 and 2018 , respectively , was derived from this borrowing activity . in these same time periods $ 428.1 million and $ 504.8 million , respectively , was used to pay down related debt . preferred stock dividends in october 2016 , the company sold and issued to development bank of japan inc. ( “ dbj ” ) an aggregate of 1,000,000 shares of the company 's 6.5 % series a preferred stock , $ 0.01 par value per share ( the “ series a preferred stock ” ) at a purchase price of $ 20.00 per share . the net proceeds to the company after deducting investor fees were $ 19.8 million . in september 2017 , the company sold and issued to dbj an aggregate of 1,500,000 shares of the company 's 6.5 % series a-2 preferred stock , $ 0.01 par value per share ( the “ series a-2 preferred stock ” ) at a purchase price of $ 20.00 per share . the net proceeds to the company after deducting issuance costs were $ 29.7 million . the company 's series a-1 preferred stock and series a-2 preferred stock accrue quarterly dividends at the rate per annum of 6.5 % per share . during the years ended december 31 , 2019 and 2018 , the company paid total dividends of $ 3.3 million on the series a-1 and series a-2 preferred stock , respectively . cash flows discussion story_separator_special_tag style= `` font-family : inherit ; font-size:10pt ; `` > , with a remaining term of 16 months as of december 31 , 2019 . in october 2019 , the company entered into an additional fixed-rate interest swap agreement which has a notional outstanding amount of $ 100.0 million , with a remaining term of 54 months as of december 31 , 2019 . the net fair value of the swaps was a $ 1.7 million net liability and a $ 1.7 million net asset at december 31 , 2019 and 2018 , respectively . we record derivative instruments at fair value as either an asset or liability . we have used derivative instruments ( primarily interest rate swaps ) to manage the risk of interest rate fluctuation . while substantially all our derivative transactions are entered into for the purposes described above , hedge accounting is only applied where specific criteria have been met and it is practicable to do so . in order to apply hedge accounting , the transaction must be designated as a hedge and the hedge relationship must be highly effective . the hedging instrument 's effectiveness is assessed utilizing regression analysis at the inception of the hedge and on at least a quarterly basis throughout its life . all of the transactions that we have designated as hedges are accounted for as cash flow hedges . the effective portion of the gain or loss on a derivative instrument designated as a cash flow hedge is reported as a component of other comprehensive income and is reclassified into earnings in the period during which the transaction being hedged affects earnings . the ineffective portion of these hedges flows through earnings in the current period . the hedge accounting for these derivative instrument arrangements adjusted interest expense by $ 0.7 million and $ 0.4 million for the years ended december 31 , 2019 and 2018 , respectively . this incremental benefit for the swaps effective for hedge accounting was included in interest expense for the respective periods . for any interest rate swaps that we enter into , we will be exposed to risk in the event of non-performance of the interest rate hedge counter-parties . we anticipate that we may hedge additional amounts of our floating rate debt in the future . related party transactions stock buybacks on september 12 , 2018 , in a transaction approved by a special committee of the board of directors , the company purchased 88,000 shares of common stock directly from the company 's chief executive officer , charles f. willis . the agreed and paid price per share was $ 34.2972 , the volume weighted average price on september 12 , 2018. joint ventures “ other revenue ” on the consolidated statement of income includes management fees earned of $ 2.9 million and $ 2.6 million during the years ended december 31

