The Exposure Draft No. 73, “Accounting Standard for Leases (Tentative Draft),” and the “Implementation Guidance on Accounting Standard for Leases (Tentative Draft),” released on May 2, 2023, will require lessees to recognize assets and liabilities for, in principle, all lease transactions. This new standard is expected to become mandatory as early as the fiscal year 2026, and it is anticipated that companies are required to prepare for this transition.
Our Technical Advisor, Tetsuzo Hamajima, provides an explanation from the lessee’s perspective, in the plainest terms possible, on key points for understanding the exposure draft, including the concepts drawn from international accounting standards.
We invite you to read the articles.
- Part 1 Article: Key Issues in the Lease Accounting Standard Revision and Practical Challenges of the Right-of-Use Model (Estimating the Lease Term)
- Part 2 Article: Fundamental Concepts of Expense Allocation, Service Contracts Including Lease Components, and Sale-and-Leaseback Transactions
For those seeking support from tax professionals, or if you have any uncertainties or questions, please feel free to contact us using the inquiry form below.
