At this meeting, the boards tentatively decided that:
The definition of a lease should not be limited to property, plant and equipment. However, the proposed new leases requirements do not apply to assets other than property, plant and equipment.
- A lease is defined as a type of contract
- A lease must convey the right to use an asset.
- The right to use an asset is conveyed if:
- a. the contract conveys the right to use a specified asset.The proposed new leases requirements will provide additional guidance about what constitutes a specified asset; and
- b. the contract conveys the right to control the use of the underlying asset. The current leases guidance regarding when a lease conveys the right to control the use of the underlying asset would be included in the proposed new leases requirements. However this guidance would be rewritten to help clarify its meaning
- A lease is for a period of time.
- The definition of a lease should explicitly state that the right to use an asset is conveyed in exchange for consideration
Therefore, the boards tentatively agreed with the following proposed definition of a lease:
A lease is a contract in which the right to use a specified asset is conveyed, for a period of time, in exchange for consideration.
The boards will continue discussing lessee and lessor accounting issues at the February 2010 joint meeting .