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Participants of this course will be introduced to the approaches in handling lease contracts in accordance with IFRS 16 and US GAAP ASC 842 regulations. After attending this course, they will be able to use the SAP Solution to cover these requirements, understand the behavior of different contract conditions within the valuation process and valuation-related posting processes.
By bringing lease liabilities and ROU assets onto the balance sheet, IFRS 16 has reshaped several key metrics, affecting how financial performance and stability are interpreted. Leverage Ratios; IFRS 16 increases leverage ratios such as debt-to-equity and gearing due to the recognition of lease liabilities as part of total debt.
Support in identifying and classifying contracts, i.e. whether the contract falls within the scope of IFRS 16; Verification of lease contract data; Support in determining the discount rate; Revision of IFRS 16 accounting policies and impacts on financial statements; Analysis of the necessary adjustments to processes and the internal control system
The course goes into great detail about the IFRS-mandated IFRS 16 principles for measurement and recognition of leases. The course focuses on the concepts of right-of-use assets, lease liability, the lease, and the service contract. IFRS 16 is a relatively new standard that has replaced the old standard, IAS 17: Leases.
Accounting for leases Application of IFRS 16 (updated briefing) Background International Financial Reporting Standard 16 Leases (IFRS 16) was published by the International Accounting Standards Board (IASB) in January 2016. It will radically change how lessees account for leases as it removes the distinction between operating and finance leases.
This guide is ideal for anyone interested in property lease management, lease administration strategies and maintaining compliance with accounting standards ASC 842, IFRS 16, and GASB 87. What exactly is lease management? Lease management is a broad topic that focuses on simplifying the management of multiple leases and subleases.
Under IFRS 16, most lease contracts result in the recognition of right-of-use-assets and lease liabilities in the statement of financial position. Therefore, leasing assets under IFRS 16 without using the exemptions related to short-term or low value leases has significant impacts on key accounting ratios of lessees – they will reduce return on capital employed and increase gearing.