Important year-end lease reporting reminders
Hot Topic | November 2024
Key presentation and disclosure reminders for preparing financial statements under ASC 842.
This Hot Topic highlights important presentation and disclosure reminders under ASC 842 as companies prepare their year-end financial statements.
Applicability
- Companies preparing financial statements and disclosures after the adoption of ASC 842.
Relevant dates
- Effective immediately
Key impacts
ASC 842 (leases) includes significant presentation and disclosure requirements. This Hot Topic contains presentation and disclosure reminders from, among other sources, SEC comment letters to registrants about their ASC 842 accounting and reporting and our own ongoing practice discussions.
The SEC staff has commented on various aspects of companies’ accounting and reporting under ASC 842, for both lessees and lessors. Those comments most frequently relate to incomplete or missing disclosures required by Sections 842-20-50 (lessees) and 842-30-50 (lessors). This Hot Topic is not a comprehensive summary of all the presentation and disclosure requirements in ASC 842; rather, it highlights items that we believe companies should pay particular attention to. Our companion Handbook, Leases contains a complete discussion of ASC 842 lessee presentation, lessor presentation and disclosure requirements, respectively.
Report contents
- Operating and finance lease balances must be presented separately from each other
- Lessee discount rate disclosures
- ROU asset amortization in operating leases
- Operating lease cash flow presentation
- Practical expedient to not separate lease and non-lease components
- Variable lease and short-term lease cost disclosures
- Nature of variable lease payments disclosure
- Lease-related non-US GAAP adjustments
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ASC 842 reporting reminders
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Handbook: Leases
Latest edition: Our in-depth guide to ASC 842 – with Q&As, interpretive guidance and examples.
Leases
Our reporting, guidance and publications relevant to the FASB's new leases standard for lessees and lessors for all industries. KPMG specialists provide an in-depth look at ASC 842 implementation
Leases: Hot Topics
These focused Hot Topics are intended for those with an interest in the detailed application of ASC 842.