Accounting for the modification: Remeasure lease liability: $1,100,000 If the lessee decides to apply this exemption each lease component and any associated non-lease component is accounted for as a single lease component. Quarterly update from KPMG on accounting and financial reporting developments, including SEC matters and FASB activity. Lease Modifications. Share. Y% Difference: Lease liability. Patricia Stebbens KPMG Australia Michael Voogt KPMG Australia Also on home.kpmg. For example, the lessee may be required to recalculate lease liabilities using a revised discount rate and adjust right-of-use assets. Lease modifications for lessees. ROUA: $200,000. While IFRS 16 is not a large standard in terms of pages when compared to other more recent standards, it is a standard that is raising many practical and interpretational issues. lease components (services) from lease components. In-depth application guidance on the new leasing standard. 15 mins; Online tutorial; In this topic we be look at the lease modifications for lessees. Subscribe. Applicability. Lease modifications: Numbers and journal entries IFRS 16 Leases contains detailed guidance on how to account for lease modifications. Subscribe to our IFRS Perspectives Newsletter . 2020 AICPA Conference on Current SEC & PCAOB Developments . Subject AccountingLink. The IASB Board has a two-phase project to assist in a smoother transition away from IBOR. provides an overview of the IASB discussions of the leases project in October 2015. Relevant dates. The International Accounting Standards Board (the Board) has issued amendments . In its final public meeting on the leases project, the IASB agreed on the effective date of the new standard and cleared five sweep issues identified during the drafting process. Related content. KPMG’s global IFRS leasing standards leader. [IFRS 16:36(c)] Covid-19-related rent concessions A lessee may elect not to assess whether a COVID-19-related rent concession is a lease modification. Meet the IFRS team . In depth s g t s k s s IFRS 16 implications for lessors in the real estate industry PwC 1 IFRS 16, ‘Leases’, will be effective for annual reporting periods beginning on or after 1 January 2019. Lessees and lessors receiving rent concessions resulting from coronavirus (COVID-19), the civil unrest in Hong Kong and other unforeseen events. This guide was fully updated in October 2020. 10.1 Data extraction challenges 49 10.2 Key transition decisions for tenants 50 10.3 Sale-and-leaseback on transition 53. PwC’s Leases guide is a comprehensive resource for lessees and lessors to account for leases under the new leases standard (ASC 842). At the effective date of the modification, the lease liability is remeasured to include the lease payments for the extended period (2020 to 2025). All other lease modifications. Each one focuses on a particular aspect and includes explanations of the requirements and examples showing them in practice, to help you apply the new standard. A lease modification includes adding or This webinar, hosted by KPMG Partner Patricia Stebbens, … The previous lease accounting model required lessees and lessors to classify their leases as either finance leases or operating leases and account for those two types of leases differently. Lease classification is reassessed only if there is a lease modification. 1 IAS 17, Leases 2 IFRIC 4, Determining whether an Arrangement Contains a Lease 3 IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors 4 IFRS 16 provides lessees with optional recognition exemptions for leases of low-value items and leases with a lease term of 12 months or less. 8.1 Increase in leased space – Adding a floor 40 8.2 Increase in lease term 41 8.3 Reduction in rent 43 8.4 Compensation for inconvenience 45. 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