IFRS 16 - Leases

IFRS 16 requires lessees to recognize a right-of-use asset and a lease liability for most leases. It eliminates the classification of leases as operating or finance leases for lessees.

IFRS 16 requires lessees to recognize right-of-use assets and lease liabilities for most leases, improving transparency versus operating lease off-balance sheet treatment.

- Used when applying IFRS/IAS requirements for recognition, measurement, presentation, or disclosure.
- Used to justify accounting treatments in working papers and financial statement notes.

- Example: When preparing year-end reporting, management applies **IFRS 16 - Leases** to determine the correct IFRS treatment and disclosures.

- Why it matters: Ensures compliance with IFRS, improves comparability across periods and entities, and reduces financial reporting risk.