The new leases standard: part 2

AASB 16 Leases became mandatorily effective for annual reporting periods beginning on or after 1 January 2019 and brings significant change to lease accounting for lessees as most leases will now need to be recognised on a lessee’s balance sheet.

The second instalment of our Leases series focuses on the lease term. The lease term is a key input in calculating the amount of the lease liability (and consequently the right-of-use asset). Assessing the lease term will often require judgement, especially when the arrangement contains features such as extension and termination options.

Read our other instalments:

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