Lease commencement date
At commencement, a lessee generally recognises a right-of-use asset and a lease liability, unless an applicable recognition exemption is elected. The commencement date can follow the inception date, when the parties first agree or commit to principal terms. Measure the initial amounts using the relevant IFRS 16 requirements at commencement and assess the lease term from that date.
Worked example
A lease is agreed on 1 January and the lessor makes the equipment available on 1 February. The commencement date is 1 February, when the lessee generally recognises the lease asset and liability.
Common mistake
Recognising the lease asset at the agreement date when the asset is not yet available, or assuming the start of use and the start of payments are always identical.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | FR | Direct | September 2026–June 2027 |
| ACCA | SBR | Direct | September 2026–June 2027 |