Scribd
Upload
3 views6 pages

Unit 2 - Lesson 2 Identifying A Lease

Acc2A

Uploaded by

shirleygebenga020829
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
3 views6 pages

Unit 2 - Lesson 2 Identifying A Lease

Acc2A

Uploaded by

shirleygebenga020829
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
You are on page 1/ 6

IFRS 16 – IDENTIFYING A LEASE

From the viewpoint of the Lessee!


Identifying a lease

At inception of a contract, an entity shall assess


whether the contract is, or contains a lease. It will
Definition of
be a lease if: an asset

• Contract conveys the right to CONTROL


• An identified asset
• For a period of time
• In exchange for consideration

Footnote 2
Identifying a lease CONTROL!!!!
!

The lessee should have both of the following:


• The right to obtain substantially all of the
economic benefits from the use of the
identified asset;
• The right to direct the use of the identified
asset.

Footnote 3
Right to obtain economic benefits
from use
• To control the use of an identified asset, a
customer is required to have the right to obtain
substantially all of the economic benefits from
use of the asset throughout the period of use
• The economic benefits from use of an asset
include its primary output (including potential
cash flows derived from these assets.

Footnote 4
Right to direct the use
• A customer has the right to direct the use of an identified
asset throughout the period of use only if either:
• The customer has the right to direct how and for what
purpose the asset is used throughout the period of use OR
• The relevant decisions about how and for what purpose the
asset is used are predetermined and the customer has the
right to operate the asset throughout the period of use,
without the supplier having the right to change those
operating instructions OR
• The customer designed the asset in a way that
predetermines how and for what purpose the asset will be
used throughout the period of use
Footnote 5
Protective rights
• A contract may include terms and conditions
designed to protect the supplier’s interest in the
asset or other assets, to protect its personnel, or
to ensure the supplier’s compliance with laws or
regulations.
• Protective rights do not prevent the customer
from having the right to direct the use of an
asset.

Footnote 6

You might also like