The Accounting Standards Upgrade (ASU) for topic ASC 842, Lease Accounting, has been issued by the FASB after years of consideration, bringing about significant changes in the industry as a whole. With the new standard in effect, public and private companies must ensure they are following the new accounting guidelines. Apart from being compliant, companies can reap several benefits from implementing the new principles.… Read More »
We’ve been addressing the changes FASB proposed and implemented in ASC 842 over the past couple of articles, including the changes in rate implicit in the lease, determination of IBR and leases embedded in contracts. After the break, FASB members, preparers and others reassembled to discuss another change; lease modifications. Here, the main issue was with regards to the complexity and costs involved with applying lease modifications in the books. This… Read More »
We previously discussed how FASB had discussed changes in ASC 842: Lease Accounting in Rate Implicit in the lease as well as the determination of IBR. At the same roundtable conference, the board also discussed the concern presented by some preparers about the identification of leases embedded within a contract. The main issue was that entities spent significant amounts of time trying to identify and… Read More »
The problem of determining the rate implicit in a lease also presented a concern that most preparers used the incremental borrowing rate (IBR) as the discount rate. However, that wasn’t the only concern that came to light during FASB’s roundtable in September 2020. Apart from the rate implicit, members also discussed the IBR; i.e., how those that have adopted ASC 842 determine the IBR. It… Read More »
One of the areas of the new lease standard that has not received that much attention is executory costs. However, as lessees consummate new leases that must be transitioned into the new standard, this is an area that should not be overlooked. Executory Costs that Transfer a Good or Service The new lease standard only… Read More »
In June 2017, the Governmental Accounting Standards Board (“GASB”) issued Statement No. 87 – Leases which establishes new accounting standards to be applied to all lease transactions for state and local governments. The Standard is effective for fiscal periods beginning after December 15, 2019 with earlier application encouraged. The governmental standard follows most of the… Read More »
Our LinkedIn group, FASB and IASB Lease Accounting Changes, is growing fast. We are closing in on 500 members. This is a great group to discuss the FASB and IASB Lease Accounting changes with as you begin thinking about preparing for the changes. https://www.linkedin.com/groups/FASB-IASB-Lease-Accounting-Changes-3852961 For more information on iLeasePro please visit: https://ileasepro.com/
The Financial Accounting Standards Board (“FASB”) issued the new lease accounting standard on February 25, 2016. As it pertains to lessees, the new standard requires that the liability for all leases (except narrowly defined short-term leases) must be recognized on the balance sheet of a lessee at the discounted present value of future lease payments… Read More »
According to Bloomberg BNA website, on Thursday February 25, 2016 the FASB plans to release its long-gestating standard on lease accounting. http://www.bna.com/feb-25-lessees-b57982067497/ For additional information, please visit: https://ileasepro.com/
The Financial Accounting Standards Board LEASE ACCOUNTING Feb. 9: New U.S. lease accounting rules that will leave deep impacts on many companies’ balance sheets are expected to be issued in the last week of February, sources at the Financial Accounting Standards Board told Bloomberg BNA. FASB hopes to issue the final lease accounting standard after… Read More »