Leases under new UK GAAP
Section 20 of the accounting standard FRS 102 covers accounting for leases. Find articles, books and online resources providing quick links to the standard, summaries, guidance and news of recent developments.
General guidance and information on the accounting standard is available from our FRS 102 page.
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FRS 102: The Financial Reporting Standard applicable in the UK and Republic of Ireland
As issued by the Financial Reporting Council (FRC) in September 2015. This updated edition incorporates amendments issued in September 2014, February 2015, March 2015 and July 2015. Leases are covered in Section 20.
More information and links to previous versions and amendments are available on our main FRS 102 page.
Model accounts and disclosure checklists for new UK GAAP
The ICAEW Library can provide model accounts and disclosure checklists for FRS 101, FRS 102, FRS 102 Section 1A, FRS 103 and FRS 105. The examples and checklists cover a broad range of entities, including small companies, charities, groups, LLPs and micro-companies.
ICAEW guidance and support
FRS 102: Amortised cost calculator
Technical tool which calculates amortised cost using the effective interest method.
Ask ICAEW Technical Advisory Service
Get an opinion from the experts. Our experienced technical advisors can help you with your new UK GAAP questions and offer practical advice. Call the advisory helpline on +44 (0)1908 248 250.
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Financial Reporting Faculty
Financial Reporting Faculty
The faculty offers assistance and support in IFRS, UK GAAP and other aspects of business reporting. It offers technical briefings and factsheets, IFRS and UK GAAP standards-trackers, plus practical advice from industry experts and working accountants.
The Library provides full text access to a selection of key business and reference eBooks from leading publishers. eBooks are available to logged-in ICAEW members, ACA students and other entitled users. If you are unable to access an eBook, please see our Help and support advice or contact firstname.lastname@example.org.
Interpretation and application of UK GAAP for accounting periods commencing on or after 1 January 2015
Steve Collings (2015)
A detailed, practical guide to applying UK GAAP with specific sections and examples covering:
- Summary of the key differences between FRS 102 and 'old' UK GAAP: Leases
- Finance leases
Includes discussion of identifying a finance lease, accounting for a finance lease by the lessee, effective interest rate, disclosure requirements, accounting for a finance lease by the lessor, amortisation and other topics with examples.
- Operating leases
Includes discussion of identifying an operating lease, accounting for an operating lease by the lessee, accounting for an operating lease by the lessor and disclosure requirements with examples.
- Manufacturer/dealer lessors
- Sale and leaseback transactions
- Small companies
UK GAAP financial statement disclosures manual
Steve Collings (2016)
A practical manual for preparing new UK GAAP-compliant disclosures. This guide collects all of the latest guidelines into one place and is designed for practical application with many real-world examples. The chapter on leasing covers:
- Classification of leases
- Finance lease disclosures under FRS 102 for lessess and lessors
- Operating lease disclosures under FRS 102 for lessess and lessors
- Micro-entity issues
- Sale and leaseback transactions.
UK GAAP 2017: Application of FRS 100–104 in the UK
This guide has been fully updated to reflect the application of the new accounting standard in practice. It focuses on each area of the financial statement in detail and explains how they are treated by FRS 102, with illustrative examples. The chapter on leases covers:
- Comparison between Section 20 and IFRS (IAS 17)
- Requirements of Section 20 for leases
Including scope, lease classification, leases as financial instruments, accounting for finance leases, accounting for operating leases, accounting for modifications to leases, sale and leaseback transactions, disclosures.
- Summary of GAAP differences.
Some guides and comparisons that we link to may pre-date the latest amendments to this standard. While these resources contain useful information, please treat them with appropriate caution.
Staff Education Note 6: Leases
Guidance note produced by the FRC comparing the accounting treatment for leases under FRS 5, SSAP 21, UITF Abstract 28 and FRS 102.
FRS 102 for professional services LLPs
Short guide published by Grant Thornton in December 2013 looking at key differences between UK GAAP and FRS 102, including classification of leases and treatment of lease incentives.
Accounting for leases under FRS 102: Operating lease expense and incentives
Business Edge bulletin from BDO, published in June 2013, giving an overview of changes with an example.
Accounting for leases under FRS 102: Principles and disclosure
Business Edge bulletin from BDO, published in June 2013, giving an overview of changes.
Articles are available to logged-in ICAEW members, ACA students and other entitled users.
Articles from other sources
FRS 102: Finance and operating leases
AccountingWEB, March 2017
Detailed article by Steve Collings explaining how finance lease interest is recognised under FRS 102 using the effective interest method with a worked example.
FRS 102: Accounting for leases - tips and advice
CCH Daily, December 2016
This article focuses on new UK GAAP and accounting for leases under section 20, highlighting key differences between FRS 102 and SSAP 21. It looks at determining whether an arrangement contains a lease, lease classification, accounting by lessees, accounting by lessors, and exemptions. Available online to Accountancy Daily subscribers or in print from the Library.
UK GAAP choices: Accounting for leases - part 6
CCH Daily, April 2016
This article examines the impact of changes to accounting for leases and differences in disclosure such as how operating leases are disclosed on an annual aggregate basis. It discusses old UK GAAP, FRS 102, FRS 105 for micro entities, the current IFRS regime and IFRS from 2019 onwards, with examples. Available online to Accountancy Daily subscribers or in print from the Library.
FRS 102: Leasing transactions
AccountingWEB, October 2013
Detailed article by Steve Collings explaining how leases are handled within FRS 102. It discusses finance and operating leases, lessor accounting, manufacturer or dealer lessors, disclosures and the future of leases.
Articles and books in the Library collection
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