Here is a brief look at IFRS 16 the new standard for reporting of leases.

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IBM Confidential – Internal Use Only
Lease Accounting – IFRS 16– September
4, 2017
Author: Paul Young, CGA
Proven Practice Advisor
Business Analytics
IBM Canada Inc.

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Paul Young - Bio
• CPA, CGA
• Academia (PF1, FA4 and MS2)
• SME – Risk Management
• SME – Close, Consolidate and
Reporting
• SME – Public Policy
• SME – Emerging Technology
• SME – Financial Solutions
• SME – Supply Chain
Management
Contact
information:
Paul_Young_CGA
@Hotmail.com
Contact Information: paul.young@ca.ibm.com

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Agenda
• Lease accounting

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Leases – IAS 16
New Lease Proposal will make no distinction between Capital and Operating Leases. All
leases with the exception of the following will be accounted for using the right-to-use model:
• Mineral rights leases
• Leases < 1 year
The new proposal will required the lease to be set up as an asset with its corresponding
liability.
Balance Sheet
Right to Use – Asset
Liability under right to use
Income Statement
Lease Expense – right to use
Financial Charge – Lease
What’s Next
• IFRS has approved the new leasing standard. The effective date is January 1, 2019.
Earlier adopters can move up the date if they have already changed to the new revenue
recognition standard for contracts
Options
• Leasing is currently part of the notes/exhibit, but on annual basis. The new standard will
make the leasing reporting part of the 10Q as well as regular monthly reporting for
business
• FASB (USA) will use a dual leasing model which could trigger FASB GAAP/ IFRS GAAP
reconciliation
• Cognos Disclosure Management/TM1 could be used as part of the reporting requirement
for Leases

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Other Sources:
• TM1 Planning Analytics - https://www.ibm.com/us-en/marketplace/planning-and-analytics