IASB publishes ED to extend 2020 practical expedient for Covid 19 Related Rent Concessions

Date: 10 February 2021

The IASB has today published for consultation the Exposure Draft (ED) Covid-19-Related Rent Concessions beyond 30 June 2021 (Proposed Amendment to IFRS16).
The 2020 amendment to IFRS16 provided lessees with relief in the form of an optional exemption from assessing whether a rent concession related to COVID-19, and that meets certain conditions, is a lease modification. Lessees can elect to account for qualifying rent concessions in the same way as they would if they were not lease modifications. That amendment only applies to payments originally due on or before 30 June 2021.  The ED proposes to extend the qualifying payment date of that practical expedient from 30 June 2021 to 30 June 2022.

The IASB ED consultation period will be 14 days, closing on 25 February 2021.

The UK Endorsement Board secretariat plan to provide comment on the exposure draft proposals and expect to commence endorsement and adoption processes shortly thereafter.  Given the very short deadlines attached to this project, we will not be able to share a draft of our comment letter to the IASB on our website. We would strongly encourage stakeholders to share views at the earliest opportunity, both on the proposed extension of the practical expedient to 30 June 2022 and any implications for the UK adoption of this amendment. We expect to publish a draft Endorsement Criteria Assessment soon after the final amendment is issued by the IASB for a short consultation period.

If you are interested in providing feedback to our consultation we encourage you to get in touch at Contact@endorsement-board.uk as soon as possible, including the name of this project in the subject field of your email.