The project is nearing completion but the Boards have decided to re-expose the proposed rule – great news. At first the Boards made tentative decisions on lessee accounting in line with the comment letter criticisms that were in line with views of the industry, lessees and many users of financial statements. Unfortunately they reversed the decision on lessee P&L treatment so that now the project assumes the lease cost pattern will be front ended. The decisions on lessor accounting are a mixed bag. The good news is they adopted one lessor model much like the current direct finance lease method which will mean more leases will be sales type leases. The bad news is sales type gains will be limited. Also leveraged lease accounting is eliminated with no grandfathering.

To read Bosco’s full August 1, 2011, update click here.

Previously on monitordaily: Bosco: Lease Accounting Project Update as of June 21, 2011