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gruffydd

New Accounting Rules - Firms Forced To Put Leases On Balance Sheets

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Interesting, so what are the current rules in the UK - this piece refers to US?

A quote for those interested ..

That will make a lot of firms look wobblier: a survey by PricewaterhouseCoopers, an accounting firm, found that it would add about 58% to the average company’s interest-bearing debt. Not only new leases but also existing ones would immediately be subject to the new rules. On the other hand, since rents will no longer be a running expense, operating earnings could see a bump upwards. But since the downturn, many companies are close to their maximum debt limits, and the new rules could push them over the edge. Small wonder they are howling.

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Thanks and whilst not trying to sound too bitter this is excellent news.

Bloo ... have you seen this, I wonder how it will affect all those repose (sic) which have been leased or are just sitting doing nothing?

From Gruffydd's previous post ...

And it’s in the troubled financial sector where the proposals may cut deepest. Banks are major lessees, holding thousands of properties in shopping malls and high streets where they operate retail outlets. Many of these leases are currently hidden

off balance sheet, according to the IASB, which wants to bring them back via a “right-

of-use” asset and a liability to pay rentals.

I think everyone would should read these, if true, next year will really test the LibCon / ConLib pact!

Edited by REP013

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Thanks and whilst not trying to sound too bitter this is excellent news.

Bloo ... have you seen this, I wonder how it will affect all those repose (sic) which have been leased or are just sitting doing nothing?

From Gruffydd's previous post ...

I think everyone would should read these, if true, next year will really test the LibCon / ConLib pact!

I have now...thanks to the reporters on this very website.

I hope Right Freds Dead has seen it too, as he's just bought a new car on a business lease.

Clearly, reporting true balance sheets is in no-ones interest in the banking sector, public sector or Government Sector, so, my guess, like the mark to market rules that were enforced then recinded when banks were found to be insolvent, this will have no mileage either...although for small firms like mine and RFDs and others here, we WILL be required to report...we are, after all, just meat puppets to be sucked dry of juice.

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I have now...thanks to the reporters on this very website.

I hope Right Freds Dead has seen it too, as he's just bought a new car on a business lease.

Clearly, reporting true balance sheets is in no-ones interest in the banking sector, public sector or Government Sector, so, my guess, like the mark to market rules that were enforced then recinded when banks were found to be insolvent, this will have no mileage either...although for small firms like mine and RFDs and others here, we WILL be required to report...we are, after all, just meat puppets to be sucked dry of juice.

Insolvency is an irrelevance to the banking sector. It's just window dressing.

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Interesting, so what are the current rules in the UK - this piece refers to US?

SSAP 21 - one of the last SSAPs still in use.

If the minimum lease payments are >90% of the fair value of the asset you capitalise it and treat the lease as a debt.

If <90% you disclose the annual payments as an note to the accounts, analysed into leases expiring in < 1 year; 1 to 5 years and > 5 years.

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  • 245 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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