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IFRS 16 LESSOR ACCOUNTING - Coggle Diagram
IFRS 16 LESSOR ACCOUNTING
Initial Measurement
Remeasurement of Gross Investment might be needed in modifications. That increase is accompanied by an increase in Unearned Finance Income. (Will eventually end in P/L as per IFRS)
J entry to initially recognise Finance lease must have VAT Output
Derecognition of Asset on a Finance lease shall be at COST Price
In calculating lease payments, or rate implicit in the lease, the PV shall be inclusive of VAT. Def of interest rate implicit in the lease
Deferred Tax
Can only be utilised if there is sufficient /will be Taxable Profits sufficient
If there is DTA Opening balance and Assessed losses arise in CY, Only recognise them up to the portion that there are enough Taxable Profits to offset them
Assessed Loss arise when Taxable difference > Accounting Profit
VAT as per s23C = VAT Input * PMT / ALL Pmts
Where only a portion of Assessed loss is recognised, the additional goes to the TAX Rate Recon (as a +ve amt)
Asset not sold per SARS. CA =0 (Because asset derecognised. TB = As per normal requirements
In preceding year, If Taxable Income is greater, Can recognise the unrecognised PY portion of Assessed Loss as DT Asset
Net Investment CA, TB = VAT Results in TD
Then reverse the full DTA when benefit has been utilised
ASSET & LIABILITY METHOD
Portion recognised in CY is recognised in Tax rate recon as negative amt
DT Calculated using 28%
Release of Unearned Finance Income Causes a Temporary Difference