IFRS 16: Leases Pt. 2 |Lessee Accounting|

[@ronasacademy]

Kindly, share with others to expand the learning community.

[@thikundekoedward2207]

good evening, what a nice explantion. its very clear.

[@thikundekoedward2207]

sir if i may ask, without using the financial calculator what is the formular for calculating the implicity interest rate?

[@phemelomolongwane2798]

Please do a lesson on IFRS 5

[@ronasacademy]

Well noted

[@phemelomolongwane2798]

For year 1 calculation of the variable lease payment will we use the commencement date index or reporting date index?

[@ronasacademy]

It depends on when the lease payments start to vary. When you are informed of the period where the lease payment should change, it will be that year, say year two; it will be the index at reporting divided by the index at year two.

[@hillsongcovers2173]

Does a right-of-use asset mean that the lease contract must only be based on finance lease instead of on that of operating lease?

[@ronasacademy]

In the perspective of the old standard on leases (IAS 17), I will say yes to your question. However, in the new standard, lessee is not allowed to recognize lease transaction as finance or operating lease. It rather when the following two conditions are absent from the contract that we can refer to the lease asset asset as right-of-use asset. 1. when the lease term is of short term and; 2. the underlying asset is of low value. So, the right-of-use asset is only based on situations when the lease contract is void of the above two conditions instead of using finance or operating lease. Thank you.

[@ronasacademy]

You can email me at [e-mail] for further clarification.

[@hillsongcovers2173]

​@@ronasacademyOk, thanks. But permit me to ask you for your formal name in full. By the way, you're a very good teacher who takes time to explain and break down everything as much as possible

[@ronasacademy]

@@hillsongcovers2173 Thank you for the feedback. Kindly reach out via [phone] or email at [e-mail] for my full name and further info, please. Thank you.

[@hillsongcovers2173]

Ok sir