FASB proposes clarifications and technical corrections to the new leases standard
Proposed ASU on land easements
- Companies with land easements, particularly in the energy, utilities, transportation and telecom industries
Proposed ASU on technical corrections
- All companies within the scope of the new leases standard
Proposed ASU – land easements
- September 25, 2017 – FASB issued proposed ASU
- October 25, 2017 – Comments due on proposed ASU
Proposed ASU – technical corrections
- September 27, 2017 – FASB issued proposed ASU
- November 13, 2017 – Comments due on proposed ASU
The proposed ASU on land easements clarifies that:
- Land easements are within the scope of the new leases standard.
- Land easements would only be accounted for under other guidance if they do not meet the definition of a lease under the new standard.
- The proposed ASU includes a practical expedient to allow an entity not to assess at transition whether a land easement meets the definition of a lease if the entity did not previously evaluate whether it was or contained a lease under the current leases standard (ASC 840).
The proposed ASU on technical corrections:
- Includes 16 technical corrections to the new leases standard and other accounting topics.
- Addresses issues raised by constituents to alleviate unintended consequences from applying the new guidance.
- Does not change core principles of the new standard, significantly affect application of the new standard, or require significant additional costs to implement.
- Proposed ASU – land easements
- Proposed ASU – technical corrections
- Effective dates and transition
- Next steps