In an article posted on CFO.com, the writer noted that when FASB and the IASB first published an exposure draft on lease accounting, the boards have been trying to come to an agreement on how to take two very different kinds of leases — equipment and rental — and account for them on the balance sheet.

CFO said the FASB and IASB’s new proposal will alter the way equipment leases treat lease costs in a company’s profit-and-loss statement.

CFO quoted Bill Bosco, president of Leasing 101 and member of the FASB/IASB Lease Project working group as saying in a recent comment to clients, “The decision is bad news for most equipment lessees and possibly bad for lessors.” Bosco contends that the proposed front loaded profit-and-loss cost pattern will be an extremely unpopular decision with equipment lessees.

Both FASB and IASB will have further discussions on lease accounting at a board meeting on July 19. A revised exposure draft is expected by the fourth quarter of 2012, CFO said.

Editor’s Note: Bill Bosco will share his news on the new FASB/IASB proposal in the upcoming July/August issue of the Monitor.

To read the full to CFO.com article click here.