Most companies not ready for new standard on lease accounting: survey

Singapore

A HEFTY new lease accounting standard is due to come into effect in 2019, but the majority of companies here have not even started preparing for it, a new study by the Institute of Singapore Chartered Accountants (Isca) and Nanyang Business School (NBS) has found.

FRS 116, which will affect the way companies account for the assets they lease, will affect all financial periods beginning on or after Jan 1, 2019. Industry sectors most affected will be the airline, retail, travel and leisure, transport, telecommunications and energy sectors - businesses that lease major items such as aircraft, properties, manufacturing facilities, ships and transportation equipment.