Updated: The FASB staff has issued guidance that permits a simplified approach to accounting for COVID-19 related rent concessions – for lessees and lessors. KPMG answers questions about the application of this optional staff guidance.
All companies that are lessees and/or lessors
If specified criteria are met, lessees and lessors can elect to forgo the evaluation of the enforceable rights and obligations of the original lease contract that would otherwise be required by US GAAP when accounting for COVID-19 related rent concessions.
Instead, the company accounts for those concessions either:
as if the concession was required by the existing lease contract; or