BLM18000 - IFRS 16 leases: IFRS 16 lessees: Example
This manual is being updated to reflect FRS 102 (2024 amendments). For guidance on the tax treatment of accounts prepared under IFRS 16 or the revised FRS 102, please refer to pages within the BLM50000 chapter.
The accounting for lessees under IFRS 16 is the same whatever the nature of the underlying asset is. The following example will look at the accounting for a property lease under IFRS 16.
The example will cover the accounting by the lessee under IFRS 16 for the ROU asset and the lease liability.
The accounting from a lessor鈥檚 perspective under IFRS 16 is broadly similar to lessor accounting under FRS 102 and will follow the rules for 鈥榦perating鈥� lease accounting or 鈥榝inance鈥� lease accounting depending on where the risk lies鈥� see BLM12000 for rules for operating leases and BLM13000 for rules for finance leases.