IASB ED/2020/4

  • For-profit

Lease Liability in a Sale and Leaseback

The International Accounting Standards Board (IASB) has recently issued for comment ED/2020/4 Lease Liability in a Sale and Leaseback (the ED).

The ED proposes to amend IFRS 16 Leases to specify how a company measures the lease liability in a sale and leaseback transaction.

IFRS 16 includes requirements for how to account for sale and leaseback transactions at the time the transaction takes place. However, it does not specify how to measure the lease liability when reporting after that date.

The proposed amendment is designed to provide greater clarity for the entity selling and leasing back an asset both at the date of the transaction and subsequently. The amendment also ensures that IFRS 16 is applied consistently to these types of transactions.

The proposed amendment would not change the accounting for leases other than those arising in a sale and leaseback transaction.


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