FASB makes improvements to its leasing guidance

  • FASB (US Financial Accounting Standards Board) (lt blue) Image

Jul 18, 2018

In July 2018, the Financial Accounting Standards Board (FASB) has issued Ac­count­ing Stan­dards Update (ASU) No. 2018-10, “Cod­i­fi­ca­tion Im­prove­ments to Topic 842, Leases.”

The ASU makes im­prove­ments to the fol­low­ing aspects of the guid­ance in the ASU:

  • Resid­ual value guar­an­tees.
  • Rate im­plicit in the lease.
  • Lessee’s re­assess­ment of lease clas­si­fi­ca­tion.
  • Lessor’s re­assess­ment of lease term and pur­chase option.
  • Vari­able lease pay­ments that depend on an index or a rate.
  • In­vest­ment tax credits.
  • Lease term and pur­chase option.
  • Tran­si­tion guid­ance related to amounts pre­vi­ously rec­og­nized in busi­ness com­bi­na­tions.
  • Certain tran­si­tion ad­just­ments.
  • Tran­si­tion guid­ance for leases pre­vi­ously clas­si­fied as capital leases under ASC 840.
  • Tran­si­tion guid­ance related to mod­i­fi­ca­tions to leases pre­vi­ously clas­si­fied as direct fi­nanc­ing or sales-type leases under ASC 840.
  • Tran­si­tion guid­ance related to sale-and-lease­back trans­ac­tions.
  • Im­pair­ment of net in­vest­ment in the lease.
  • Un­guar­an­teed resid­ual assets.
  • Effect of initial direct costs on rate im­plicit in the lease.
  • Failed sale-and-lease­back trans­ac­tions.

For more in­for­ma­tion, see the ASU on the FASB’s Web site.


Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.