Deloitte: IFRS final leasing standard brings greater reporting accuracy, but difficult judgements ahead
13 January 2016
Commenting on the final IFRS leasing standard published today, Deloitte, the business advisory firm, says it will result in many leased assets, previously held off balance sheet, being brought onto companies’ books potentially adding billions in lease-intensive industries.
Veronica Poole, global IFRS leader and UK head of accounting, Deloitte, said: “It has been a long haul with many twists and turns along the way. But the real challenges start now and the volume of work in the lead up to a 2019 implementation must not be underestimated. Identifying all the relevant transactions is challenging enough, not least the boundary between what is now considered a ‘lease’ and a ‘service’. What is in and what is out will result in a series of difficult judgements”.
The new standard means that companies will be viewed and compared by their investors differently. Poole states: “The final result should be clearer for both preparers and investors, since a very obvious part of financing will become explicit rather than remain implicit. Ultimately, today’s standard will ensure a more accurate outcome that investors will welcome.”
Note to editors
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.
Deloitte LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, whose member firms are legally separate and independent entities. Please see www.deloitte.co.uk/about for a detailed description of the legal structure of DTTL and its member firms.
The information contained in this press release is correct at the time of going to press.
Member of Deloitte Touche Tohmatsu Limited.