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Aren’t they financial assets ?
Lesse:
Rent payable -operating lease
Finance Lease obligation- finance leaseAren’t they financial liability ?
Lessor:
Rent Receivable –
Finance lease receivableif not why ?
A financial asset is a contractual obligation to receive cash, so the lease receivable is a financial asset.
A financial liability is a contractual right to pay cash, so the lease liability is a financial liability.
In an operating lease there is no asset or liability.
Rent payable/ Rent recievable under operating lease , they look like same as trading recievable/payable which qualifies for ias 32 financial asset/liability .please guide me
You’re doing the same thing with your obsession with financial instruments! Leases are under IAS 17, just because it gives rise to either a financial asset or financial liability within it doesn’t meant we need to go crazy about financial instruments.
Imagine we buy PPE on credit. What standard are we dealing with?
IAS 16, yes there is a payable due to buy it on credit but I’m not going to spend my exam time writing about financial instruments when it is clearly about PPE.
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