IndAS 116applicability

This query is : Resolved

Gudipati Roja (Querist)
Follow

28 July 2021 Good evening all,

X co has taken premises on lease for 6 years. as per AS-19 Leases. it qualifies as operating lease. However can you please let me know weather IndAS 116 is applicable to this transaction to recognise as lease liability and lease assets. If so can you please provide lease workings format.

Note : lessee shall not sub lease and only lessee shall have right to terminate

Aashok Kumar Sharma online

Aashok Kumar Sharma online

(Expert)
Follow

09 July 2024 IND AS 116 requires leases to be recognized on the balance sheet as a lease liability and a right-of-use asset for the lessee, regardless of whether they are classified as operating leases or finance leases under previous standards. The lease recognition process involves identifying the lease, calculating the present value of lease payments, and recognizing a right-of-use asset at the commencement date. This change aims to provide more transparency about a lessee's financial commitments arising from leasing arrangements.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now