June 2025 ACCA Exams

How was your exam? Comments & Instant poll >>

20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for September 2025 exams.
Get your discount code >>

Lease Term – Clause with an Option to Terminate

This topic has 1 reply, 2 voices, and was last updated 3 years ago by Stephen Widberg.

Viewing 2 posts - 1 through 2 (of 2 total)

Author
Posts
October 30, 2021 at 8:17 pm #639509
siwela1
Member
- Topics: 24
- Replies: 17
Example:-
A lease contract is for 5 years.
The lease contains a clause to terminate the lease 2 years before its initial end. The lessee is reasonably certain NOT to exercise this option.
So what is the lease term?
October 31, 2021 at 7:25 am #639522
Stephen Widberg
Keymaster
- Topics: 16
- Replies: 3408
i would assume 5 years.
IFRS 16:
The non-cancellable period for which a lessee has the right to use an underlying asset, plus:
a) periods covered by an extension option if exercise of that option by the lessee is reasonably certain; and
Author
Posts

Viewing 2 posts - 1 through 2 (of 2 total)

You must be logged in to reply to this topic.