As a result of the COVID-19 pandemic, many enterprises are receiving rent concessions. This includes lease payment deferrals or payment forgiveness, or they are renegotiating lease terms.
Section 3065, Leases provides guidance on accounting for changes in the provisions of an existing lease and requires that any such changes be accounted for as a new lease (i.e. a lease modification). This could be onerous for private enterprises with many leases if all rent concessions needed to be accounted for as new leases.
The AcSB decided to amend Section 3065 to provide relief for both lessees and lessors on accounting for rent concessions as a result of the COVID-19 pandemic.