Implementing the proposals would be a real challenge for many organisations. The impacts – including significant effort to identify leases and extract lease data, changes in financial metrics, and balance sheet volatility – would be felt across sectors.
Companies that lease high-value assets would see large increases in reported liabilities, while companies with large volumes of lower-value leases could face high implementation costs.
Mr Kenny Tan, Partner with Accounting Advisory Services at KPMG in Singapore who leads the leasing standard implementation said: “Implementing these proposals would be a real challenge for many organisations, as they would need to identify all their leases, extract let data, make new estimates and judgements, and perform new calculations. Companies will also need to consider how these proposals would affect their business practices, systems and processes and performance measurement.”
This publication helps you understand what the proposals could mean for your business.