UITF Abstract 28 Operating Lease Incentives
Issued February 2001. Effective accounting periods ending on or after 22 September 2001.
UITF Abstract 28 has been superseded by FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland for accounting periods beginning on or after 1 January 2015. For more information visit:
Synopsis
Operating lease incentive include up-front cash payments to the lessee or reimbursement of costs by the lessor or initial period of the lease term may be rent-free or at a reduced rent.
All incentives should be recognised as an integral part of the net payment agreed for use of the lease asset.
- A lessee should reduce the rental expense over the shorter of the lease term or date when full market rental will be payable.
- A lessor should recognise the cost as a reduction in rental income over the same period.
Last updated 21 June 2015
