Leases: The Lessor Perspective

Author: Pat Patterson

This course will define whether there is a lease. If there is a lease, is it a finance lease or an operating lease? Depending on the type of lease, this course will detail how to record the income, expenses, and any financial statement issues of the lessor. Further, disclosures required by the lessor on their financial statements and correct financial statement treatment of leases is examined from the lessor perspective.

Publication Date: June 2019

Designed For
Any professional with clients or employers that are lessors and need to know the correct accounting based on the latest pronouncements from the Financial Accounting Standards Board (FASB).

Topics Covered

• Lease definition
• Finance or operating lease?
• Expenses or fees collected by the lessor from the lessee and how the lessor should handle the collection on the books and records of the lessor
• What are some of the cost considerations?
• What about lessor disclosures on their financial statements?
• How should the lessor handle cancellations, defaults, and other issues?

Learning Objectives

• Identify a lease by the correct definition
• Recognize lease definitions that apply to both lessee and lessor
• Describe updated on Lessor issues
• Recognize the lessor presentation by Lessor in financials
• Identify the classification criteria for distinguishing between finance leases and operating leases
• Identify the date of initial recognition and measurement of a lease for lessees and lessors
• Recognize the core principle of the new ASC 842
• Differentiate what is recognized in the balance sheet for sales type and direct financing leases from a lessor's perspective
• Identify the present value of the lease payments plus the present value of the guaranteed portion of estimated residual value
• Recognize what is conveyed for purposes of a lease as it relates to an underlying asset
• Identify lease terms
• Differentiate between ASCs and how they apply to leases
• Differentiate types of leases
• Identify the lease receivable plus the unguaranteed residual asset

Level
Basic

Instructional Method
Self-Study

NASBA Field of Study
Accounting (2 hours)

Program Prerequisites
None

Advance Preparation
None