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A client with numerous leases nationwide needs a solution to automate the measurement of rights-of-use assets and corresponding lease liabilities. Previously, lease costs were expensed as incurred, with all rental payments treated as expenses in the Profit and Loss Account. However, with the adoption of MFRS 16 Leases, long-term leases must be classified as rights-of-use assets and future financial commitments as finance liabilities. Short-term and low-value leases, however, continue to be expensed in the Profit and Loss Account without the need for measurement as rights-of-use assets and lease liabilities.
A client with many leases (for premises) nationwide requires a solution for automating the measurement of rights-of-use assets and the corresponding lease liabilities.
Previously, the cost for the leases were expensed of when incurred i.e. a straightforward accounting treatment whereby all rental payments were treated as expenses in the Profit and Loss Account.
The adoption of MFRS 16 Leases requires long term leasing of premises be classified as rights-of-use asset and the future financial commitment as finance liabilities. However, short-term leases and low value leases are expensed off to the Profit and Loss Account i.e. no requirement for measuring them as rights-of-use assets and lease liabilities.
The Management require assistance for the proper treatment of leases in accordance with the MFRS 16.
The accounting bases for determining what can be categorised as short term lease, low value lease and leases to be treated as rights-of-use assets.
The automated solution for measurement of the above.
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A client with many leases (for premises) nationwide requires a solution for automating the measurement of rights-of-use assets and the corresponding lease liabilities.
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