IFRS 16

Overview:

Introduction:

IFRS 16 is an International Financial Reporting Standard issued by the International Accounting Standards Board (IASB) that provides guidance on lease accounting. It replaces the previous IAS 17 standard, introducing a single lessee accounting model that requires lessees to recognize assets and liabilities for most leases. This standard aims to enhance transparency, comparability, and accountability in financial reporting related to leases. This training program provides participants with comprehensive knowledge on IFRS 16, its application, and the impacts on financial statements and organizational processes.

Program Objectives:

By the end of this program, participants will be able to:

• Explore the key principles and objectives of IFRS 16.

• Identify leases and assess their impact on financial statements.

• Adhere to the accounting requirements for lessees and lessors under IFRS 16.

• Analyze the implications of IFRS 16 on financial ratios and performance.

• Develop strategies to ensure compliance with IFRS 16 requirements.

Targeted Audience:

• Finance and accounting professionals.

• Auditors and compliance officers.

• Financial controllers and analysts.

• Professionals involved in lease management and reporting.

• Decision-makers in organizations affected by lease accounting changes.

Program Outline:

Unit 1:

Introduction to IFRS 16:

• Overview of IFRS 16 and its objectives.

• Key differences between IFRS 16 and IAS 17.

• Scope of IFRS 16: defining a lease.

• Benefits of adopting IFRS 16 for financial reporting.

• Key stakeholders impacted by IFRS 16 implementation.

Unit 2:

Lease Identification and Recognition:

• Criteria for identifying leases under IFRS 16.

• Components of lease agreements: payments, terms, and conditions.

• Recognition of right-of-use assets and lease liabilities.

• Expedients available for short-term and low-value leases.

Unit 3:

Accounting for Lessees and Lessors:

• Single lessee accounting model: initial and subsequent measurements.

• Accounting treatment for lessors under IFRS 16.

• The process of calculating and presenting right-of-use assets and lease liabilities.

• Disclosure requirements for lessees and lessors.

• Transition options for adopting IFRS 16.

Unit 4:

Financial Impact and Analysis:

• Effect of IFRS 16 on financial statements and ratios.

• Tools for assessing changes in EBITDA, net income.

• Implications for financial planning and budgeting.

• Effective techniques for communicating IFRS 16 impacts to stakeholders.

Unit 5:

Implementation and Compliance Strategies:

• Steps for implementing IFRS 16 within organizations.

• Importance of leveraging technology for lease data management and reporting.

• Addressing challenges in transitioning to IFRS 16.

• Ensuring compliance with IFRS 16 through internal controls and audits.