Lease accounting impacts of the COVID-19 virus
Hot Topic | April 2020
This Hot Topic addresses impacts to companies’ lease accounting from the economic effects of the COVID-19 pandemic.
The economic and financial markets effects of the COVID-19 outbreak may have a number of impacts on companies’ lease accounting under ASC 842. This article follows our recent Hot Topics on accounting for rent concessions resulting from the COVID-19 outbreak.
Relevant dates
Key impacts
The economic and financial markets effects of the COVID-19 outbreak may have one or more of the following impacts on a company’s lease accounting:
- Impairment of a lessee’s ROU assets and lessor’s owned assets held out for lease
- Abandonment of ROU assets
- Lessee discount rates
- Lessee reassessments
- Fair values
- Lease cost and operating lease revenue recognition
- Lessor revenue recognition – collectibility
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