Lease Signed After Reporting Date

[BC CPA]

Hi - this may be a basic question. If a company signs an office lease renewal (that is material) and has different terms that the initial lease, so a modification, after the reporting date but prior to filing date, a disclosure is required due to IAS 10. This is a non-adjusting subsequent event, but the disclosure criteria are to a) provide nature and b) financial effect

for b) what might one have to disclose? would you still need to do all of the lease calculations anyways such as calculating the pv of min lease payments and therefore needing to update all the terms in the agreement?

We wanted to sign after reporting date to avoid some workload, but I am not sure signing after the reporting date will do the trick

[JRSB]

I think the threshold for non-adjusting events is higher than material, normally it's very key events, look at the examples in the standard. If you do disclose it a description of the financial effect is good but you don't need the precise details, I'd probably say the key terms and length etc. The standard know you need time to work out detailed things which is why you have measurement periods, so you could just say the key details but still being calculated (if you disclose it at all)

[Marek Muc]

Hi, you can disclose approximate amounts only. However, if the agreement is signed well before the authorisation of financial statements it would look silly if the actual amounts reported next year would be substantially different from the subsequent events disclosure.

[Marek Muc]

wow, we replied at the same time! well, I replied 2 mins later but didn't see your post

[JRSB]

Similar answer luckily