This article, "FASAB proposes changes in federal lease accounting," originally appeared on AccountingToday.com.
Summary provided by MaterialAccounting.com: This article discusses the recent updates from The FASAB. The update provides technical clarification and amendments on lease accounting.
The Federal Accounting Standards Advisory Board is looking for feedback on an exposure draft of a proposed set of technical clarifications and amendments on lease accounting for the federal government.
The document, “Omnibus Amendments: Technical Clarifications Addressing Lessee and Lessor Discount Rates and Sale-leasebacks,” aim to clarify the application of lessee and lessor discounting requirements and the application of sale-leasebacks guidance to intragovernmental sale- leasebacks and the disclosure requirements applicable to them.
FASAB, not to be confused with the similarly named FASB, advises on accounting standards for the federal government, not the private sector. It is asking for comments on the exposure draft by July 8, 2022, while encouraging commenters to provide the reasons for their positions.
This Statement of Federal Financial Accounting Standards (SFFAS) would amend certain paragraphs in SFFAS 54, “Leases,” and SFFAS 60, “Omnibus Amendments 2021.”
“These proposals are a continuation of the board’s post-issuance research on SFFAS 54,” FASAB chair George A. Scott said in a statement. “As the effective date nears, the goal has been to facilitate the ongoing leases implementation activities across the federal community through extensive outreach and the efforts of a dedicated task force. Comment letters on this proposal will further support that goal as the board’s due process continues following the comment period.”
Among the changes, the proposal would address certain ongoing areas of concern not addressed in SFFAS 60, including clarifying FASAB’s original intent for discounting lease liabilities and receivables to result in a more consistent and comparable application of SFFAS 54 requirements; and clarifying the applicability of paragraphs 89-92 of SFFAS 54 to intragovernmental sale leasebacks and the disclosure requirements applicable to them.