On 24 February 2015, the IASB staff published a Project Update on the definition of a lease. This document sets out the consequences of decisions taken by the two Boards in the course of their redeliberations of the scope of the future standard.
Keywords: Mazars, Thailand, IFRS, IASB, Leases
18 May 2015
In particular, it clarifies that a lease is a contract that conveys to the customer the right to use an asset for a period of time in exchange for consideration. For there to be a lease within the meaning of the future standard, the contract must:
- relate to an identified item, and
- convey to the customer the right to use the item for the specified period of time, which entails exclusive use of the item and control over the way it is used.
Contracts not meeting this definition will be classified as service contracts. The Project Update contains six hypothetical examples illustrating how to distinguish a lease from a service contract.
This document can be consulted on the IASB site.