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International Accounting
 

IFRS 16 Leases: Standard's novation and the impact of the COVID-19 pandemic on the accounting and reporting information disclosure

Vol. 23, Iss. 9, SEPTEMBER 2020

Received: 31 August 2020

Received in revised form: 3 September 2020

Accepted: 7 September 2020

Available online: 15 September 2020

Subject Heading: INTERNATIONAL STANDARDS OF ACCOUNTING AND REPORTING

JEL Classification: М41

Pages: 962–980

https://doi.org/10.24891/ia.23.9.962

Vakhrushina M.A. Financial University under Government of Russian Federation, Moscow, Russian Federation
vakhrushina@mail.ru

https://orcid.org/0000-0003-3896-5345

Subject. This article discusses the methodological features of the present-day accounting for rental transactions and disclosure of the relevant reporting information in accordance with IFRS, taking into account the impact of the COVID-19 pandemic on organizations' activities.
Objectives. The article aims to argue the present-day interpretation of rental transactions and their reflection in accounting and reporting in connection with the entry into force of IFRS 16 Leases, based on an analysis of the content of IFRS 16 amendments published by the International Accounting Standards Board (IASB) in May 2020 in connection with the COVID-19 pandemic. The article also intends to systematize the basic requirements for disclosure of additional information in financial statements in connection with the negative impact of the COVID-19 pandemic on the activities of Russian organizations, and define promising directions of the development of the theory and practice of accounting of rental operations in accordance with the existing paradigm of IFRS development.
Methods. For the study, I used content analysis, systematization, and classification techniques, and the abstract-logical method.
Results. The article describes the distinctive features of the new methodological approaches to disclosure in accordance with IFRS 16 compared to the previous standard. The article also identifies possible approaches to the financial reporting of lease-related concessions considering COVID-19.
Conclusions. The impact of the COVID-19 pandemic has been particularly devastating for the service industry concerning rental operations. The article arrives at the conclusion that it is necessary and possible for tenants to disclose the associated additional reporting information.

Keywords: financial reporting, lease, IFRS, COVID-19 pandemic, arrangements for accounting, economic downturn

References:

  1. Plotnikov V.S., Plotnikova O.V. [FSBU 25/2018 “Accounting for Leases” and IFRS 16 “Leases”: A comparative analysis of key provisions]. Uchet. Analiz. Audit = Accounting. Analysis. Auditing, 2019, vol. 6, iss. 6, pp. 42–51. URL: Link (In Russ.)
  2. Plotnikov V.S., Plotnikova O.V., Mel'nikov V.I. [The theoretical aspects of IFRS 16]. Mezhdunarodnyi bukhgalterskii uchet = International Accounting, 2017, vol. 20, iss. 1, pp. 2–15. (In Russ.) URL: Link
  3. Khamidullina G.I., Safiulina R.A. [Tenant's method of accounting for rental transactions]. Vestnik nauki, 2019, vol. 3, no. 5, pp. 254–257. (In Russ.) URL: Link
  4. Rozhnova O.V. [Current financial reporting problems]. Mezhdunarodnyi bukhgalterskii uchet = International Accounting, 2013, no. 15, pp. 2–8. URL: Link (In Russ.)
  5. Vakhrushina M.A., Get'man V.G., Demina I.D., Druzhilovskaya T.Yu. et al. MSFO i Federal'nye standarty bukhgalterskogo ucheta: sistemnoe razvitie, problemy vzaimodeistviya: kollektivnaya monografiya [IFRS and the Federal Accounting Standards: Systemic development, problems of interrelationship: a collective monograph]. Moscow, KnoRus Publ., 2019, 206 p.
  6. Vakhrushina M.A., Shcheglovskya Yu.A. Informatsionnoe soprovozhdenie biznesa na baze konvergentsii printsipov upravlencheskogo ucheta i MSFO: problemy i puti resheniya: monografiya [Information support of business on the basis of convergence of management accounting principles and IFRS: problems and solutions: a monograph]. Moscow, Rusains Publ., 2020, 244 p.

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