On or about 20 August 2019, the Accounting Standards Council (ASC) has submitted its comment on ED/2019/2 Annual Improvements to IFRS Standards 2018–2020 to the IASB.
The ASC are generally supportive of the proposals set out in the ED, subject to their comments on IFRS 9 Financial Instruments and Illustrative Examples accompanying IFRS 16 Leases as stated in their comment letter.
The ASC recommend that the IASB should consider amending the example to explain why a particular reimbursement of leasehold improvements would not meet the definition of lease incentives. For example, the IASB could illustrate leasehold improvements made to the lessor’s asset, instead of the lessee’s asset, as an example of when the reimbursement of leasehold improvements would not be associated with the lease.
Source: ASC website, 20 August 2019