IFRS 16 introduces a single lessee accounting model and requires a lessee to recognise assets and liabilities for all leases with a term of more than 12 months, unless the underlying asset is of low value.

IFRS 16 replaces IAS 17, IFRIC 4, SIC-15 and SIC-27. IFRS 16 sets out the principles for the recognition, measurement, presentation and disclosure of leases. In May 2020 the Board issued Covid-19-Related Rent Concessions, which amended IFRS 16.

IFRS 16 Leases has now been successfully adopted by companies reporting under IFRS® Standards. It is the new normal for lease accounting around the world. IFRS 16 had a significant impact on the financial statements of lessees with ‘big-ticket’ leases, from retailers to banks to media companies.

We have been releasing our in-depth application guidance on IFRS 16 Leases in manageable chunks, one chapter at a time. 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.

IFRS 16 is an International Financial Reporting Standard (IFRS) promulgated by the International Accounting Standards Board (IASB) providing guidance on accounting for leases. IFRS 16 was issued in January 2016 and is effective for most companies that report under IFRS since 1 January 2019. [1]

The purpose of this article is to summarise some of the key issues related to IFRS 16 from the perspective of the lessee and how these impact on financial reporting. IFRS 16 replaced International Accounting Standard (IAS ®) 17. The approach of IAS 17 was to distinguish between two types of lease.

Aug 19, 2024 · In this high-level overview of IFRS 16, we introduced the key differences for lessee accounting under IAS 17 and IFRS 16, provided an example of a lessee amortization schedule and the related journal entries, and discussed the required disclosures.

IFRS 16 requires separate presentation of the interest expense on the lease liability and the depreciation charge for the right-of-use asset in the lessee’s statement of profit or loss and other comprehensive income.

International Financial Reporting Standard 16 Leases (IFRS 16) is set out in paragraphs 1⁠–⁠106 and Appendices A⁠–⁠D. All the paragraphs have equal authority. Paragraphs in bold type state the main principles. Terms defined in Appendix A are in …

Jan 14, 2025 · IFRS 16 introduces a framework for lease accounting, transforming how leases are recognized and measured. Lessees must bring most leases onto the balance sheet, recognizing a right-of-use asset and a corresponding lease liability.