Lease Term calculation (months) [IFRS16:18]
Logically, there should be only one of the options selected - either to extend, or to terminate.
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Depreciation Term calculation (months) [IFRS16:32]
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Payments per Year calculation
Payment Frequency
- Weekly: Payments per Year = 52
- Fortnightly: Payments per Year = 26
- Monthly: Payments per Year = 12
- Quarterly: Payments per Year = 4
- Semi-Annual: Payments per Year = 2
- Annual: Payments per Year = 1
Number of Payments = Lease Term (months) [IFRS16:18] / 12 * Payments per Year
Lease Payment Amount calculation [IFRS16:27a]
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PV of Amounts Due at Lease Term
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PV of Amounts Due at Lease Term = PV (Discount Rate, Number of Payments, Amount Due at Lease Term)
Present Value of Lease Payments = PV (Discount Rate, Number of Payments, Lease Payments)
PV calculation
In the system, an Excel equivalent XNPV is being used
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where:
- di = the i-th, or last, payment date.
- d1 = the 0-th payment date.
- Pi = the i-th, or last, payment.
System uses 360/30 convention. Calculating that there are 360 days in a year and every month gets 30 as payments monthly are equal.
Lease Liability at Commencement Date calculation
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Right-of-Use Asset at Commencement Date calculation
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Calculation exceptions for TRANSITION leases
Right-of-Use Asset at Transition Date = Lease Liability at Transition Date
Calculation exceptions for Migration lease
Lease Liability at Migration Date - field entered in Migration tab. In first month remeasurement done to get system favourable amounts.
Right-of-Use at Migration Date - calculated from Historical asset cost - Accum. Depreciation at Migration
- At Migration Lease Liability and RoU has to be the same. Difference between them is posted in equity or some balancing account.