💡New RELEASE for LEASE ACCOUNTING: Periodic Compound Interest Calculations in 24D — Cloud Customer Connect
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💡New RELEASE for LEASE ACCOUNTING: Periodic Compound Interest Calculations in 24D

edited May 22, 2025 3:34PM in Lease Accounting 2 comments

Summary: Periodic Compound Interest Calculations in 24D and Later Releases

Content: Lease accounting, in accordance with IFRS 16 and ASC 842, calculates the right-of-use and liability balances by discounting the contractual lease payments using a discount rate.

Once the liability balance has been calculated, interest expense is calculated by amortizing the balance over the lease term based on the lease payments and the discount rate.
On the other hand, the right-of-use amortization balance and the lease term are used to calculate the right-of-use amortization expense.

Until 24C, lease accounting supported the daily interest method for calculating right-of-use and liability balances, as well as liability interest expense.

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