Leases Flashcards
1
Q
A lease is a
A
contract, or part of a contract, that conveys the right to use an asset (the underlying asset) for a period of time in exchange for consideration
2
Q
If the lease is short-term (12 months or less at the inception date) or of a low value, then a simplified treatment is allowed.
A
In these cases, the lessee can choose to recognise the lease payments in profit or loss on a straight-line basis. No lease liability or right-of-use asset would therefore be recognised.
IFRS 16 Leases does not specify a particular monetary amount below which an asset would be considered ‘low value’, although the basis for conclusion indicates a value of $5,000 as a guide
3
Q
A
