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Guideline PSG 5 - Sale-leaseback transactions

Effective date:

April 1, 2005

Published by the PSAB:

June 2005


The purpose of this Guideline is to define a sale-leaseback transaction and describe how to account for such transactions when the leaseback involves either a leased tangible capital asset or an operating lease.

A sale-leaseback transaction is the sale of property by a government and the leasing of the same property, or a portion thereof, back to the government.

The "components" approach is adopted to account for a sale-leaseback transaction.  [PSG 5.5]  The components approach assumes that the sale and leaseback can be separated objectively by comparing the terms and conditions of the sale-leaseback to its related fair value information. The comparison enables each component part of the transaction to be accounted for according to its economic substance. The components of a sale-leaseback transaction include the property, lease liability, revenues and expenses (including gains and losses), and any other assets or liabilities that may result from the transaction.

History of Guideline PSG 5




June 2005

New Guideline

This new Guideline relates to sale-leaseback transactions.

February 2007


Editorial revisions.

Note: The above summary does not include details of consequential amendments made as the result of other projects.

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.