Incremental borrowing rate

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Financial reporting - IFRS 16.

(IBR).

The lessee's Incremental Borrowing Rate is a key concept in financial reporting for leases under IFRS 16.


The incremental borrowing rate is the rate the lessee would pay to borrow:

  • Over a term similar to the lease term
  • With a similar security


When the interest rate implicit in the lease cannot be determined, the IBR shall be used instead, to discount the related lease liabilities and assets for reporting under IFRS 16.


See also


Other links

Definitive guide to deriving IFRS 16 discount rates: The Treasurer