in february 2016 the FASB issued a new lease accounting stan

in february 2016, the FASB issued a new lease accounting standard that will take effect in December 2018. The most significant change required by this new standard is

Solution

The most significant change bought by the new accounting standard introduced by FASB on leases is that the new standard requires for a lessee to recognize assets and liabilities for leases with lease terms of more than 12 months, irrespective of whether the lease is a capital lease or operating lease. It thereby requires that both the type of leases should be recognized on the balance sheet.