The FASB and IASB have issued new guidance for leases under ASC 842 and IFRS 16, respectively. The new standards require public business entities to put their leases on balance, impacting their key financial ratios.
of leases are classified as operational leases by lessees
increase in EBIT is expected on average due to IFRS 16.
"The rate of interest that a lessee would have to pay to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment."
"The rate of interest that a lessee would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment."
The lessee, reflected in a company-specific credit rating
The notional amount of the lease or effective funds borrowed
The quality of the underlying collateral
The term of the lease arrangement
The economic environment, including the jurisdiction and currency of the lease
Upload the lease portfolio and the financial statements of the lessees.
The solution determines the credit rating of the lessee.
The solution determines the appropriate incremental borrowing rate for each lease.
The solution delivers a report that contains the pricing grid as well the underlying methodology.
Upload the lease portfolio and the financial statements of the lessees.
The solution determines the credit rating of the lessee.
The solution determines the appropriate incremental borrowing rate for each lease.
The solution delivers a report that contains the pricing grid as well the underlying methodology.
Interested in seeing what the Incremental Borrowing Rate Solution could mean for your financial reporting? Don’t hesitate to contact us.