The AASB has issued AASB 2018-8 Amendments to Australia Accounting Standards – Right-of-use Assets of Not-for-Profit Entities to provide a temporary option for not-for-profit lessees to elect to measure a class (or classes) of right-of-use assets arising under ‘concessionary leases’ at initial recognition at cost, rather than at fair value.
This Standard amends AASB 1, AASB 16, AASB 117, AASB 1049 and AASB 1058 to provide a temporary option for not-for-profit entities to not apply the fair value initial measurement requirements for right-of-use assets arising under leases with significantly below-market terms and conditions principally to enable the entity to further its objectives. The Standard requires an entity that elects to apply the option (i.e. measures a class or classes of such right of-use assets at cost rather than fair value) to include additional disclosures in the financial statements to ensure users understand the effects on the financial position, financial performance and cash flows of the entity arising from these leases.
To view the amendment to the Accounting Standard in full, click here.
