Leases (Topic 842): Lease Modifications
Last updated on April 20, 2021. Please refer to the Current Technical Plan for information about the expected release dates of exposure documents and final standards.
(Sections updated on the date above are indicated with an asterisk *)
On October 20, 2020, the Board issued proposed Accounting Standards Update, Leases (Topic 842): Targeted Improvements. The due date for comment letters was December 4, 2020.
The Board discussed the comment letter feedback on Issue 3: Modifications Reducing the Scope of a Lease Contract in the proposed Accounting Standards Update, Leases (Topic 842): Targeted Improvements. The Board decided not to finalize the proposed amendments related to this issue without considering whether other potential improvements to the lease modification model that were raised in the comment letters and at the September 2020 roundtable meeting should be considered. The Board directed the staff to identify those other potential improvements and potential solutions if warranted for the Board’s consideration at a future meeting.
A summary of the Board’s tentative decisions reached to date can be found here.
Last updated on April 20, 2021. Please refer to the Current Technical Plan for information about the expected release dates of exposure documents and final standards.
(Sections updated on the date above are indicated with an asterisk *)
Objective:
The objective of this project is to consider whether targeted improvements to Topic 842, Leases, related to lease modification accounting are warranted.Background:
As part of its post-implementation review efforts, the FASB continues to actively engage with stakeholders to monitor the implementation of Topic 842. Additionally, the FASB periodically receives formal agenda requests that identify implementation issues that could be improved through standard setting. This project was added to the Board’s technical agenda in response to stakeholder feedback that indicated that improvements were warranted in relation to this issue.Exposure Draft(s):
On October 20, 2020, the Board issued proposed Accounting Standards Update, Leases (Topic 842): Targeted Improvements. The due date for comment letters was December 4, 2020.
- Download the proposed Accounting Standards Update, Leases (Topic 842): Targeted Improvements
Comment Letters:
Read comment letters on the proposed Accounting Standards Update.
Read the press release on the proposed Accounting Standards Update.
Decisions Reached at Last Meeting (as of February 10, 2021)
The Board discussed the comment letter feedback on Issue 3: Modifications Reducing the Scope of a Lease Contract in the proposed Accounting Standards Update, Leases (Topic 842): Targeted Improvements. The Board decided not to finalize the proposed amendments related to this issue without considering whether other potential improvements to the lease modification model that were raised in the comment letters and at the September 2020 roundtable meeting should be considered. The Board directed the staff to identify those other potential improvements and potential solutions if warranted for the Board’s consideration at a future meeting.
Tentative Board Decisions Reached to Date (as of February 10, 2021)
A summary of the Board’s tentative decisions reached to date can be found here.
The Board meeting minutes, handouts, and videos are provided for the information and convenience of constituents who want to follow the Board’s deliberations. All of the conclusions reported are tentative and may be changed at future Board meetings. Decisions become final only after a formal written ballot to issue a final standard.
The following are links to the minutes for each meeting. To view Board meetings and handouts from the past 90 days, click here.
The following are links to the minutes for each meeting. To view Board meetings and handouts from the past 90 days, click here.
| February 10, 2021* | Board Meeting—The Board discussed the comment letter feedback on the three issues in the proposed Accounting Standards Update, Leases (Topic 842): Targeted Improvements. The Board decided to consider amendments to lessors’ accounting only (rather than both lessees’ and lessors’ accounting) to resolve the issue of sales-type leases with variable lease payments. The Board directed the staff to further research an alternative raised in the comment letters to address that issue. The Board decided to remove the issue of lessees’ option to remeasure lease liability from the technical agenda. The Board decided not to finalize proposed amendments to lease modifications without considering other potential improvements to the lease modification model raised in comment letters and the September 2020 roundtable meeting. |
| July 29, 2020 | Board Meeting—The Board discussed whether to amend Topic 842 to provide targeted improvements related to sales-type leases with variable lease payments, lessees’ option to remeasure lease liability for changes in a reference index or rate on which lease payments are based, and modifications that reduce the scope of a lease contract. The Board decided to do so and directed the staff to draft a proposed Accounting Standards Update for vote by written ballot. |
The staff will perform research and outreach and present it for the Board’s consideration at future meetings.
The staff has prepared this summary for information purposes only. Any Board decisions are tentative and do not change current accounting. Official positions of the FASB are determined only after extensive due process and deliberations.