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IFRS 16, Leases - AcSB

Date recorded:

At its meeting on February 15, 2018, the AcSB discussed the IFRS® Discussion Group’s recommendation from its January 2018 meeting to consider whether to refer the issue, “IFRS 16: Lease Incentive,” to the International Accounting Standards Board (IASB) or IFRS® Interpretations Committee. The Board agreed with the Group that there is a conflict between paragraph 24(b) and Illustrative Example 13 of IFRS 16.

The Board also considered the additional information that it directed staff to obtain about the potential effect the issue “IFRS 16 and IAS 34: Variable Lease Payments” could have on entities when adopting IFRS 16. The Board agreed there is merit to the issue and that clarifying the interaction between paragraph 38(b) of IFRS 16, Leases and paragraph B7 of IAS 34 Interim Financial Reporting (i.e., accompanying illustrative example) would help with implementation efforts in practice.

For both issues, the AcSB will explore options with the IASB to determine what is the most efficient and effective way to clarify the interaction between the authoritative text in IFRS 16 and the non-authoritative illustrative examples of both IFRS 16 and IAS 34.

Review the Executive Summary on the AcSB's Web site.

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