Agreement reached by IASB and FASB on lease accounting approach
Jun 13, 2012
Today, the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) reached an agreement on an approach to account for lease expenses as part of their project to change the lease accounting guidance under IFRSs and U.S. GAAP. Under the agreed-upon approach, leases over one year in length would be included on the balance sheet.
At today’s joint IASB/FASB meeting, the Boards agreed on a proposed approach that will allow lease contracts to be accounted for in one of two ways: 1) using an approach similar to that proposed in the 2010 Lease exposure draft and 2) an approach that results in a straight-line lease expense.
Any conclusions reached by the Boards are preliminary. The Boards expect to issue a joint exposure draft in the fourth quarter of 2012.