IFRS 16 lease schedule

Work out the lease liability and right-of-use asset at commencement, then the interest, payments and depreciation for every period.

Covers a fixed-payment lease with an optional fixed yearly increase. It does not handle variable payments, residual value guarantees, purchase or extension options, or remeasurements. Leases of 12 months or less, and low-value leases, can be exempt under IFRS 16.

Maturity analysis

Lease schedule

Journal entries

Estimates for accounting practice and learning, not accounting advice. Method follows IFRS 16 Leases: the lease liability is the present value of the lease payments at your incremental borrowing rate, the right-of-use asset is the liability plus prepayments, initial direct costs and restoration costs less incentives, and the asset is depreciated straight-line over the lease term. Rounding differences are cleared in the final period. Restoration costs also need a provision under IAS 37, which this tool does not schedule.