• Accounting Alert November 2020

Ongoing management and reporting of leases – Do you need help?

New Zealand Tier 1 and Tier 2 for-profit entities have now implemented the new IFRS 16, but it is only the start of an ongoing process to manage and account for their lease portfolio. An entity’s lease portfolio changes constantly and can generally be grouped into the following four categories and numerous subcategories, which all lead to different accounting outcomes:

It is vital any change in a lease arrangement, whether formally agreed with the lessor or not, is treated with the above categories no matter how complicated, as they lead to different accounting outcomes.

In addition to the above, lessees also have to account for COVID-19 related rent concessions after considering the May 2020 amendments to IFRS 16. You can read more about these in our International Financial Reporting Bulletin: Accounting for lessee rent concessions: FAQs.


This means that organisations must not only be able to transition to IFRS 16, but their system must be efficient enough to be update leases and make quick changes. This may require a technology investment, as simple Excel sheets will likely prove too difficult to use.

Our BDO IFRS experts currently assist our New Zealand clients with their lease accounting problems in the following ways:

  1. Providing monthly, quarterly or annual outsourced lease accounting via BDO’s Managed Lease Services 
  2. Licensing BDO Lead, our IFRS 16 technology solution.

Please contact our BDO IFRS experts if you would like to know how we take the hassle out of your ongoing lease management and reporting obligations.


For more on the above, please contact your local BDO representative.