The Financial Accounting Standards Board, or FASB, together with the International Accounting Standards Board, or IASB, is comprehensively reconsidering lease accounting. On May 16, 2013 the FASB issued Proposed Accounting Standards Update, Leases (Topic 842): a revision of the 2010 proposed Accounting Standards Update, Leases (Topic 840) (the Update).
The Update presents far reaching revisions to accounting for leases. Lawyers will need to understand the rules to advise clients on the impact of the new rules on transactions, securities filings and debt covenants.
We have compiled a tutorial for lawyers covering the basic steps associated with the proposed lease accounting rules. For the sake of simplicity the guide focuses on accounting for lessees.