IFRS 16 lease

Question 1

One of criteria of leasing asset under IFRS 16

Answer 1

the entity has an uninterrupted right to use the asset (control) and the asset is identified.

Question 2

Initial recognition actions under IFRS 16:

Answer 2

Take Right of use asset on the BS;
Recognize the liability on BS;
Make lease payment - interest to PnL and principal reduce from liability;
Charge depreciation on RoU Asset in PnL

Question 3

Exceptions to recognition criteria under IFRS 16:

Answer 3

1) Low value contacts - less than 5000 USD;

2) Short term contact.

Question 4

Measuring the lease liability formula

Answer 4

Lease liability = Present value of lease payments + PV of expected payments at the end of lease (if such taken place in contact)

Question 5

Measuring the right of use asset formula

Answer 5

RuA = PV lease liability + initial direct costs + prepayments + restore / dismantle - incentives