On July 21st, the FASB and IASB (collectively the “Boards”), verified our presumptions relating to the Leases topic- they will re-expose the lease accounting proposal containing their revisions and tentative decisions thus far. Essentially, the Boards intend to give interested parties the opportunity to comment on the updated proposal, a process that began on August 17th, 2010, with the publishing of the original Exposure Draft.
Affirming the Boards’ intent to drastically overhaul the way leases are accounted for, Leslie F. Seidman, Chairman of the FASB noted, “During our discussions of the extensive comments we received on the exposure draft, the boards have reaffirmed the major change to lease accounting, which is to report lease obligations and the related right-to-use on the balance sheet.”
The FASB website indicates that the new exposure draft will be reissued by Q4 of 2011. Hans Hoogervorst, Chairman of the IASB, realizes the need for comment: “Although we have yet to conclude our deliberations on this project, the direction of travel indicates that there are aspects of our revised proposals that would benefit from additional input from interested parties.” One thing weighing in favor of the Boards’ plan for a celeritous comment and deliberation period is the fact that over the last few months their re-exposure has, in retrograde fashion, moved closer to the original draft. See our FASB update from July, 7th. Please stay tuned as we continue to follow the Boards’ deliberations.
For the full press release please visit the IFRS website.