04 Oct 2022 1 min read
Previously IFRS 16 only included guidance on how to account for sale and leaseback transactions at the date of the transaction itself. It did not specify any subsequent accounting when reporting on the sale and lease back transaction after that date.
As a result (without further requirements), when the payments include variable lease payments, there is a risk that a modification or change in the leaseback term could result in the seller-lessee recognising a gain on the right of use retained—even though no transaction or event would have occurred to give rise to that gain.
Consequently, the IASB decided to add subsequent measurement requirements for sale and leaseback transactions to IFRS 16.
The amendments are applicable for annual reporting periods beginning on or after 1 January 2024, with early application permitted. If the amendments are applied in an earlier period, this should be disclosed.
Learn how to determine the transaction price under Step 3 of IFRS 15's five-step revenue recognition model, including key considerations for customer contracts and financial reporting.
Share-based payments have become increasingly popular over the years, with many entities using equity instruments or cash and other assets based on the value of equity instruments as a form of payment to directors, senior management, employees, and other suppliers of goods and services.
Share-based payment transactions with non-employees involve compensating parties other than employees, such as suppliers of goods and services.
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