IAS 17: Difference between revisions
imported>Doug Williamson (Remove SSAP 21. Add FRS 102.) |
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International Accounting Standard 17, dealing with leases. | International Accounting Standard 17, dealing with leases. | ||
''IAS 17 was replaced by IFRS 16.'' | |||
''IFRS 16 became mandatory - for companies reporting under international financial reporting standards - from 1 January 2019.'' | |||
IAS 17 required finance lease liabilities to be accounted for 'on balance sheet'. | |||
It also required the appropriate allocation of the total lease instalments between finance charges and reduction of the outstanding lease liability. | |||
Under IAS 17 the total finance charge was spread in such a way as to produce a constant periodic rate of interest on the remaining balance of the liability. | |||
However, IAS 17 also allowed for some form of approximation to be used to simplify the calculation. | |||
Fully accurate calculation bases for spreading the total finance charge included the Actuarial method. | |||
The Sum of the digits method is simpler to apply, and will normally produce a close approximation. | |||
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* [[FRS 102]] | * [[FRS 102]] | ||
* [[IFRIC 4]] | * [[IFRIC 4]] | ||
* [[IFRS 16]] | |||
* [[International Financial Reporting Standards]] | * [[International Financial Reporting Standards]] | ||
* [[Off balance sheet finance]] | * [[Off balance sheet finance]] | ||
* [[Operating lease]] | * [[Operating lease]] | ||
* [[Sum of the digits]] | * [[Sum of the digits]] | ||
[[Category:Accounting,_tax_and_regulation]] | |||
[[Category:Compliance_and_audit]] | |||
Latest revision as of 10:47, 5 October 2023
International Accounting Standard 17, dealing with leases.
IAS 17 was replaced by IFRS 16.
IFRS 16 became mandatory - for companies reporting under international financial reporting standards - from 1 January 2019.
IAS 17 required finance lease liabilities to be accounted for 'on balance sheet'.
It also required the appropriate allocation of the total lease instalments between finance charges and reduction of the outstanding lease liability.
Under IAS 17 the total finance charge was spread in such a way as to produce a constant periodic rate of interest on the remaining balance of the liability.
However, IAS 17 also allowed for some form of approximation to be used to simplify the calculation.
Fully accurate calculation bases for spreading the total finance charge included the Actuarial method.
The Sum of the digits method is simpler to apply, and will normally produce a close approximation.
