Handbook | December 2023

Insight

Real estate lessor guide

Includes new and updated interpretations for ASC 842, with new material for ASU 2023-01 on common control arrangements.

Angie Storm

Angie Storm

Deputy Chief Accountant, Dept. of Professional Practice, KPMG US

+1 212-909-5488

Robin Van Voorhies

Robin Van Voorhies

Senior Director, Dept. of Professional Practice, KPMG US

+1 617-988-5637

Our in-depth guide features real estate focused Q&As based on our experience with companies implementing ASC 842 and discussions with industry and preparer groups, the FASB and SEC staffs. Now updated to include new and updated interpretations, with new material addressing ASU 2023-01 on common control arrangements.

Applicability

Real estate lessors in scope of ASC 842 (ASU 2016-02, ASU 2018-01, ASU 2018-10, ASU 2018-11, ASU 2018-20, ASU 2019-01, ASU 2020-02, ASU 2020-05, ASU 2021-05, ASU 2023-01).

Relevant dates

Effective date

Public business entities*

All other entities

Annual periods – Fiscal years beginning after                                           

December 15, 2018

December 15, 2021

Interim periods – In fiscal years beginning after

December 15, 2018

December 15, 2022

Early adoption allowed?

Yes

Yes

* This includes (1) ‘public’ not-for‑-profit entities (i.e. those that have issued or are conduit bond obligors for securities that are traded, listed or quoted on an exchange or an over‑-the‑-counter market), with the exception of those entities that have not yet issued financial statements under ASC ‑842 as described in the following paragraph, and (2) employee benefit plans that file or furnish financial statements with or to the SEC.

Public not-for-profit entities that have not issued (or made available for issuance) financial statements reflecting the adoption of ASC 842 as of June 3, 2020, must adopt ASC 842 for annual and interim periods in fiscal years beginning after December 15, 2019. Early adoption is permitted.

 

Report contents:

  • Scope and definition of a lease
  • Separating components of a contract
  • Lessor accounting
  • Other considerations
  • Transition

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