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Please provide summary on Ind AS 17 - Leases

Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 Prity asked about 3 years ago

Please provide summary on Ind AS 17 - Leases

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3 Answers
Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 Ashika answered over 2 years ago

The objective of this Standard is to prescribe, for lessees and lessors, the appropriate accounting policies and disclosure to apply in relation to leases. This Standard shall be applied in accounting for all leases other than: (a) leases to explore for or use minerals, oil, natural gas and similar non-regenerative resources; and (b) licensing agreements for such items as motion picture films, video recordings, plays, manuscripts, patents and copyrights. However, this Standard shall not be applied as the basis of measurement for: (a) property held by lessees that is accounted for as investment property (see Ind AS 40, Investment Property); (b) investment property provided by lessors under operating leases (see Ind AS 40, Investment Property); (c) biological assets within the scope of Ind AS 41 Agriculture held by lessees under finance leases; or (d) biological assets within the scope of Ind AS 41 provided by lessors under operating leases.

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Open uri20170510 32134 1ue0f38?1494421710 rohit agarwal answered almost 3 years ago

Please provide summary on Ind AS 17 - Leases The objective of this Standard is to prescribe, for lessees and lessors, the appropriate accounting policies and disclosure to apply in relation to leases. This Standard shall be applied in accounting for all leases other than: (a) leases to explore for or use minerals, oil, natural gas and similar non-regenerative resources; and (b) licensing agreements for such items as motion picture films, video recordings, plays, manuscripts, patents and copyrights. However, this Standard shall not be applied as the basis of measurement for: (a) property held by lessees that is accounted for as investment property (see Ind AS 40, Investment Property); (b) investment property provided by lessors under operating leases (see Ind AS 40, Investment Property); (c) biological assets within the scope of Ind AS 41 Agriculture held by lessees under finance leases; or (d) biological assets within the scope of Ind AS 41 provided by lessors under operating leases. This Standard applies to agreements that transfer the right to use assets even though substantial services by the lessor may be called for in connection with the operation or maintenance of such assets. This Standard does not apply to agreements that are contracts for services that do not transfer the right to use assets from one contracting party to the other.

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Data?1494421730 rohit awasthi answered about 3 years ago

Dear Friend > Ind AS 17 - Leases A lease gives one party (the lessee) the right to use an asset over an agreed period of time in return for payment to the lessor. Leasing is an important source of medium and long- term financing; and accounting for leases can have a significant impact on lessees’ and lessors’ financial statements. Leases are classified as finance or operating leases at inception, depending on whether substantially all the risks and rewards of ownership transfers to the lessee. Under a finance lease, the lessee has substantially all of the risks and rewards of ownership. All other leases are operating leases. Leases of land and buildings are considered separately under Ind AS. Under a finance lease, the lessee recognises an asset held under a finance lease and a corresponding obligation to pay rentals. The lessee depreciates the asset. The lessor recognises the leased asset as a receivable. The receivable is measured at the ‘net investment’ in the lease–the minimum lease payments receivable, discounted at the internal rate of return of the lease, plus the unguaranteed residual that accrues to the lessor. Under an operating lease, the lessee does not recognise an asset and lease obligation. The lessor continues to recognise the leased asset and depreciates it. The rentals paid are normally charged to the income statement of the lessee and credited to that of the lessor on a straight-line basis unless another systematic basis is more representative of the time pattern of the user’s benefit or if the payments to the lessor are agreed to increase in line with expected general inflation to compensate for the lessor’s expected inflationary cost increases. Linked transactions with the legal form of a lease are accounted for on the basis of their substance–for example, a sale and leaseback where the seller is committed to repurchase the asset may not be a lease in substance if the ‘seller’ retains the risks and rewards of ownership and substantially the same rights of use as before the transaction. Equally, some transactions that do not have the legal form of a lease are in substance leases if they are dependent on a particular asset that the purchaser can control physically or economically. Thanks

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