An executive overview of the lease accounting standard from a lessor’s perspective.
- Lessor accounting is not fundamentally changed, but important differences from ASC 840 exist.
- Key aspects of the lessor accounting guidance have been aligned with the guidance in ASC 606 (revenue recognition).
- Your customers will now be required to recognize all leases, including operating leases, with terms greater than 12 months on their balance sheets.
- Accounting systems, processes and control changes will likely be necessary to comply with the changes to lessor accounting and the increased lessor disclosure requirements.
- Lessors can choose between two transition methods, with additional practical expedients available.
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