Go to Source
Author:
In our comment letter, we supported the FASB’s efforts to reduce the cost and complexity of applying the guidance in ASC 842, Leases, by allowing lessors to make an accounting policy election to not evaluate whether sales taxes and similar taxes imposed by a third party on a lease revenue-producing activity are the primary obligation of the lessor as owner of the underlying leased asset. However, we believe the Board should clarify certain aspects of the proposal. We also support addressing stakeholders’ concerns about the difficulty of estimating certain costs paid directly by lessees to third parties on the lessor’s behalf but recommend that the FASB make changes to the proposed amendments to make them operable. We also support addressing stakeholders’ concerns about the guidance on when a lessor recognizes variable payments that relate to both a lease component and non-lease component.