How will the New Lease Accounting affect Entities and Accountants?
Lessees will be required to perform significantly more monitoring and record-keeping, particularly for leases currently classified as operating leases. Auditors will be relieved of making some of the subjective judgments required under the current model, but will be required to make other judgments (such as most likely amounts), and need to perform more detailed audit procedures due to the increased quantity of leases reported, and the necessity of assuring that all leases are reported. The discussion paper for public comment as a step preceding the development of an exposure draft of a proposed standard. The discussion paper focuses primarily on lessee accounting. The FASB and IASB request views on a few lessor accounting issues, but expect to address lessor accounting in more detail at a later stage in the project.
