The International Accounting Standards Board has released a new document describing some of its most recent tentative decisions from the first half of the year on the standards for lease accounting, including what appears to be an about-face on how leases should be categorized, opening up a new gulf between it and the Financial Accounting Standards Board.

In the document, the IASB said the two boards have made different tentative decisions regarding the recognition and presentation of lease expenses in a lessee’s income statement. The IASB has tentatively decided to propose a single lessee model that would require the recognition of interest and amortization for all leases recognized on a lessee’s balance sheet. FASB, for its part, has tentatively decided to propose a dual model that retains the existing distinction between finance leases (that is, leases that are in-substance purchases) and operating leases. FASB’s model would result in no change to a lessee’s income statement, but recognizes all leases on the balance sheet.

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