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Good Afternoon Sensei
A. Property held by lessee under operating lease.
1. this means that entity is the lessee? ie if I hold a prop under operating lease then…..
B. such a property maybe classified under IAS 40 provided that
he mentions 3 points out of which one is:
“1. Rest of Investment prop definiton is met”.
“2.The operating lease is accounted for as if it was a Finance lease under IAS 17.”
“3. Lessee uses the FV model for recognition”I dont understand #2 line. If i am holding a prop under operating lease, why wd I be accounting it as a Fin lease?
in fact, the entire B part does not make sense to me and i hope u can shed wisdom.
regards
It may be treated as investment property where previously it had been held as a finance lease under the old (now removed) IAS 17
If it no longer satisfies the new definition of a right-to-use asset, it is now an operating lease but may be classified as investment property so long as the other two conditions are satisfied
OK now?
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