IFRS 16 - Leases
    The accounting treatment of leases:
    Recognition
    Measurement
    Presentation
    Disclosure
   IFRS 16 - Leases
    Recognition:
    “a lease contract conveys the right of the lessee to 
    control the use of an identifiable asset for a period 
    of time in exchange for consideration”.
    IFRS 16 essentially removes the distinction between 
    finance leases and hire purchase contracts.
     IAS 17 V IFRS 16
    IFRS 16 also removes the distinction between operating 
      and finance leases.
                                                 st
      For accounting periods commencing after 1  January 
      2019 ALL leases must be capitalised in the statements of 
      the lessee.
    There are 2 possible exemptions:
      –
       where the lease is for a maximum term of 12 months or 
       less,
      –
       Where the asset has a value of less than (around) 
       £3,000 in value.
   IAS 17 V IFRS 16
   Under IAS 17 many companies treated leases as operating leases 
   and therefore did not capitalise either the asset or the liability.
   This made it difficult to compare companies that used different 
   types of agreements to essentially have a similar right of use of 
   similar assets.
   From an interpretation point of view, a company using hire 
   purchase as a means to finance assets would appear to have a 
   poorer current ratio, acid test ratio and gearing ratio than a 
   company that used an operating lease to acquire the right to use 
   an asset.
   IFRS 16 eliminates this problem.
  AST - Accounting for Leases - Lessors
   Measurement
   Essentially the same as IAS 17.
   Interest can be accounted for using a fair means, therefore, 
   the use of the sum of the digits method has been retained 
   here. 
   The ASP has been changed to reflect the fact that the 
   buyer is paying only one instalment in the first year.