Is Your Construction Company Ready For the Proposed Accounting Standard Update on Leases?

On August 17, 2010, the Financial Accounting Standards Board jointly with the International Accounting Standards Board released a Proposed Accounting Standards Update on Leases that represents a fundamental change to lease accounting.

The proposed standard would apply to all leases except leases of intangible assets, leases to explore for or use minerals, oil, natural gas and similar non-regenerative resources, and leases of biological assets.

The proposed standard is intended to address concerns from financial statement users of lack of comparability since similar transactions can be accounted for differently and improve the financial statement representation of lease transactions. Continue reading »