Comment Letter to FASB on Leases
HFMA commented to the Financial Accounting Standards Board (FASB) on its proposed Accounting Standards Update, Leases (Topic 840), which would require that assets and liabilities arising under leases be recognized in the statement of financial position.
The existing accounting models for leases require lessees to classify their leases as either capital leases or operating leases. FASB says that those models have failed to meet the needs of users of financial statements because they do not provide adequate representation of leasing transactions. In particular, FASB says these models omit relevant information about rights and obligations that meet the definitions of assets and liabilities.
While HFMA was generally supportive of the "right-of-use" model described in the proposal, HFMA had specific recommendations for improving certain attributes of this approach.
Publication Date: Thursday, December 16, 2010