IFRS 16

• Balance Sheet Impact: Requires lessees to recognize lease liabilities and right-of-use assets on the balance sheet for most leases.

• Lease Definition: Defines a lease as a contract conveying the right to use an asset (the underlying asset) for a period in exchange for consideration.

• Recognition and Measurement: Lease liabilities are initially measured at the present value of lease payments, while right-of-use assets are initially measured at the amount of the lease liability.

• Subsequent Measurement: Lease liabilities are subsequently measured using the effective interest method, and right-of-use assets are depreciated over the lease term or useful life.

Before learning IFRS 16, it's beneficial to have the following skills:

1. Understanding of Accounting Principles: Familiarity with basic accounting concepts and principles, including financial statement preparation and analysis.

2. Knowledge of Financial Reporting Standards: Understanding of International Financial Reporting Standards (IFRS) and their application in financial reporting.

3. Financial Analysis: Ability to analyze financial data and interpret financial statements, including balance sheets and income statements.

4. Excel Proficiency: Skills in using spreadsheet software like Excel for financial calculations, data analysis, and reporting.

By learning IFRS 16, you gain the following skills:

1. Lease Accounting Expertise: Proficiency in understanding and applying the principles of lease accounting under IFRS 16.

2. Financial Statement Analysis: Ability to analyze financial statements, particularly with respect to lease obligations and assets.

3. Balance Sheet Management: Understanding of how leases impact balance sheet items such as liabilities and assets.

4. Compliance Knowledge: Knowledge of regulatory compliance requirements related to lease accounting standards.