In January 2016, the IASB issued IFRS 16 Leases to replace the existing IAS 17 and is applicable to annual reporting periods beginning on or after 1 January 2019. IFRS 16 specifies how an IFRS reporter will recognise, measure, present and disclose leases.
The new lease accounting standard will fundamentally change the accounting for lease transactions and is likely to have significant implications and impacts on the financial ratios. Almost all leases will be recognized on the balance sheet, with a right of use asset and financial liability that recognise more expenses in profit or loss during the earlier life of a lease. This two-day course takes an in-depth look at the standard, key changes and how to navigate the key issues to ensure a seamless transition.
The change to lease accounting is one of the most significant changes in IFRS for a number of years. It will have a significant effect on your balance sheet (and potentially your income statement). The new standard will remove the current distinction between finance leases and operating leases. Instead there will be a single model applicable to all leases. This model will bring most leases onto the balance sheet with an asset and a corresponding liability. Due to the impact on key financial ratios this will affect bank covenants, credit ratings and how others view your organisation’s financial position.

• Objective
• Scope
• Recognition exemptions
• Identifying a lease
• Separating components of a contract
• Interest rate implicit in the lease
• Impact on financial ratios
• Lease terms/ Definitions – Old Vs. New
• Short Term Leases and Leases of Low
Value Items
• Measuring Lease Liability
• Variable Lease Payments
• Case Studies based on various
industries
• Accounting by lessees
• Accounting by lessors
• Sale and leaseback transactions
• Leases – IFRS Vs. US GAAP
• Case Studies and Examples
• Disclosure
• Effective date and transition

At the end of the course, participants are expected to understand the:
• Rationale for the accounting change;
• An overview of the new framework for leases;
• The definition of a lease;
• The exceptions for short-term and low-value
leases;
• Contracts with lease and service components;
• Effective date and transition;
• The systems and process changes you will need
to implement and when;
• Practical exercises to aid understanding; and
• The commercial impact of the changes and
a discussion around how these need to be
managed.

• Financial control Staff
• Management accountants
• Staff in treasury, operations, risk management, IT and/or compliance departments
• Internal auditors