ACCA FR · Chapter 6 · Question 5 of 9
Under IFRS 16, which of the following leases qualifies for the short-term lease exemption?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) A lease with a term of 10 months that contains no purchase option
Explanation
A short-term lease has a lease term of 12 months or less at commencement and no purchase option. If the exemption is chosen, lease payments are expensed on a straight-line basis over the lease term and no right-of-use asset or lease liability is recognised.
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