New Rules And Amendment Of IAS-17 And AASB 117: Free Solution

⭳   54 Download     📄   5 Pages / 1062 Words

Discuss about the Changes And Application Of New Rules And Amendment Of IAS-17 And AASB 117.

Answer:

Classification of lease

In case of operating lease, all the expenses and amount paid should be charged from the profit and loss accounts of company (Chand & Cummings, 2008).

Newly amended lease rules and regulations as per the IAS-17 and AASB-117

AASB 117 lease provides details bifurcations which were not given under the IAS 17 and it is particularly issued by IASB. In addition to this, the entire lease prepared by organization should be covered as capital lease. In addition to this, contingent liabilities and other lease assets which were shown under the off balance sheet liabilities will also be shown under the lease terms and contingents.  This AASB-117 also includes Australian-specific paragraphs which were included by IAS-17 to increase the effectiveness of lease and establish harmonization in international lease standards and GAAP accounting rules (Xu, et al. 2017).

Off balance sheet liabilities’

It is an accounting terms and impacts a company’s level of debts and liabilities. It is observed that when company has doubt in its lease payment or contingent lease amount then the entire amount which are supposed to be made should be written in the notes to accounts. These levels of changes will increase the transparency and recording of lease amount while following international and domestic rules (Tan?Kantor, Abbott & Jubb, 2017).

References

Accounting, A., Part, B., & Plans, D. B. (2015). Notes to the financial statements.

Chand, P., & Cummings, L. (2008). The Political and Unstable Nature of the IASB's ‘Stable Platform’: Post?Convergence Australian Experience. Australian Accounting Review, 18(3), 175-184.

Xu, W., Xu, W., Davidson, R. A., Davidson, R. A., Cheong, C. S., & Cheong, C. S. (2017). Converting financial statements: operating to capitalised leases. Pacific Accounting Review, 29(1), 34-54.