Hello everyone, I would like to ask about the interest rates used to compute the lease liability:
a. interest rate implicit in the lease
b. lessee's incremental borrowing rate
c. Consumer price index/benchmark index (for variable lease)
How are these rates determined? and who determines them?
Also, do you have a link to an example where variable leases based on CPI or benchmark indexes are applied?
Your help is very much appreciated. Thank you! Just need some help understanding some things, I find IFRS 16 quite complicated. Thank you again
IFRS 16 - Determination of index/rate
Re: IFRS 16 - Determination of index/rate
a. https://ifrscommunity.com/knowledge-bas ... -the-lease
b. https://ifrscommunity.com/knowledge-bas ... owing-rate
c. those rates should be stated in the contract
b. https://ifrscommunity.com/knowledge-bas ... owing-rate
c. those rates should be stated in the contract
- Jessa Marie
- Posts: 11
- Joined: 14 Oct 2020, 09:39
Re: IFRS 16 - Determination of index/rate
I was about to update my question. Thank you very much for the help as always!