The new lease accounting standard, IFRS 16 Leases, comes into force for accounting periods beginning on or after 1 January 2019. The changes will mean that all operating leases will need to be recorded on balance sheet as a right of use asset and corresponding liability with implications for gearing and other financial ratios.

1.            Collecting data

Different leased properties will have different landlords and some leases may go back many years. The ability to access good historic lease data may determine which transition method is applied, with many organisations electing not to follow the fully retrospective approach because there is insufficient data.