Lease accounting in today’s uncertain economic environment

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Every Tuesday in March, Suzanne Stephani is taking over the podcast to bring you the latest on different types of financing arrangements - from debt to leases to supplier financings - including how the current macroeconomic environment impacts the accounting. 

To kick off the series, Heather Horn and Suzanne are joined by Marc Jerusalem, a PwC managing director who also specializes in leasing, to discuss how the current macroeconomic environment impacts the accounting for leases.

In this episode, you’ll hear discussion of:

• 2:23 - Recent FASB standard setting on leases between entities that are under common control 
• 7:38 - How rising interest rates may make it more challenging to use an existing borrowing rate to measure a lease
• 14:21 - Remeasurement events that may occur more frequently during times of economic uncertainty and what assumptions may need to be updated as a result of them
• 20:37 - Impairment of right-of-use asset considerations when a company decides to sublease or abandon a leased space
• 31:37 - Frequent questions on the classification of lease activity in the statement of cash flows 

For more information, listen to our other podcasts in PwC’s Leasing Toolkit series and read our publication on frequently asked questions on accounting in uncertain times. 

Suzanne Stephani is a director in PwC’s National Office specializing in the statement of cash flows, as well as the application and interpretation of the accounting guidance related to financing and leasing transactions.

Marc Jerusalem is a managing director in PwC’s National Office specializing in leasing. Marc consults with clients on complex lease accounting issues and is a frequent contributor to many related PwC National Office publications.

Heather Horn is PwC’s National Office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series. With over 30 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.

Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [email protected].