Accounting Updates for Government Entities: GASB Statement No. 87, Leases
The Governmental Accounting Standards Board (GASB) has created a single approach to the accounting and reporting of leases with the issuance of GASB Statement No. 87, Leases (Statement 87). State and local governments should expect Statement 87 to have a significant impact on their financial statements.
The new standard is based on the foundational principle that, economically, a lease finances the right to use an underlying asset. As a result, the accounting for leases required by Statement 87 results in a single approach for lessors and lessees that accounts for leases based on that common financing element. This new standard is a significant change from the current approach.
Accounting Updates for Government Entities: GASB Statement No. 87, Leases summarizes the new standard and explains how it will impact government entities.
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