Hi,
An operation whereby an entity sells its property to entity B, and entity B lease it back to entity A is a leaseback operation. However, if entity A sells to entity B, and entity B sublease it to entity C, and entity C lease it back to entity A, is that a leaseback operation? Or, just a sell followed by leases and subleases?
Leaseback
- JakobLavrod
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Re: Leaseback
Out of interest here, what is the functional purpose of entity C?
IFRS 9 Impairment Specialist
Risk Control at Svenska Handelsbanken
Risk Control at Svenska Handelsbanken
Re: Leaseback
I'd apply this guidance: https://ifrscommunity.com/knowledge-bas ... -contracts
Re: Leaseback
probably to sidestep the sale and leaseback accounting rulesJakobLavrod wrote: ↑16 Nov 2023, 06:46 Out of interest here, what is the functional purpose of entity C?
- JakobLavrod
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Re: Leaseback
I think ICAEW:s ethics course made a point of transactions constructed with no real business purpose other then to sidestep rules, is a road one should stay clear off as much as possible, and I often find that being very good advice in general
IFRS 9 Impairment Specialist
Risk Control at Svenska Handelsbanken
Risk Control at Svenska Handelsbanken
Re: Leaseback
Leo was asking for a friend