Leasing toolkit: Getting lease measurements/modifications right

In our Toolkit podcast series, we take a deep dive into one accounting topic each month that goes beyond the basics and into areas that require judgment. This month, we are covering leasing–a multifaceted area that generates numerous questions.In this episode, Heather Horn was joined by Suzanne Stephani and Marc Jerusalem, Directors from PwC’s National Office, to discuss the accounting guidance for some of the primary measurement and lease modification judgments that need to be made.In this episode, you will hear:2:20 - Common questions related to lease measurement7:38 - Considerations around variable payments 10:08 - Key concepts and tools when accounting for lease incentives 16:38 - Determining the lease term when there are automatic renewals21:59 - The importance of periodic reassessment of the lease term for lessees31:10 - How to select the correct discount rate37:09 - Lease modifications: what they are and how to account for themWant to learn more? Listen to our previous podcast, Full disclosure: Leases, and read our chapter on modification and remeasurement of a lease in our Leases guide.Suzanne Stephani is a Director in PwC’s National Office specializing in the application and interpretation of the accounting guidance related to financing and leasing transactions as well as the cash flow statement.Marc Jerusalem is a Director in PwC’s National Office specializing in leasing. Marc consults with clients on complex lease accounting issues and is a contributor to many related PwC National Office publications.Heather Horn is PwC’s National Office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series. With over 30 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [email protected] you enjoy this episode? Text us your thoughts and be sure to include the episode name.