• Not-for-profit
  • Public Sector

Leases and Request for Information, Concessionary Leases and Other Arrangements Similar to Leases

The International Public Sector Accounting Standards Board (IPSASB) has recently issued for comment Exposure Draft 75, Leases (ED 75) together with Request for Information, Concessionary Leases and Other Arrangements Similar to Leases (the RFI). These two documents form the next two phases of the IPSASB’s leases project.


In January 2018, the IPSASB sought comments on Exposure Draft 64 Leases (ED 64) which proposed new requirements for lease accounting based on IFRS 16, Leases issued by the IASB.

The feedback received by the IPSASB on ED 64 was mixed. While it showed overall support for the proposals for lessee accounting, the IPSASB could not reach a consensus view on the proposals for lessor accounting and concessionary leases.

As a result, the IPSASB decided to proceed with their leases project in two phases:

  • Phase One to deal with lease accounting for both lessees and lessors based on IFRS 16. The proposals have been re-exposed as ED 75 as part of this phase.
  • Phase Two to deal with concessionary leases, and other ‘lease-like’ arrangements in the public sector. Issuing the RFI is the first part of this phase.


IPSASB ED 75 cover

ED 75 is based on IFRS 16, Leases issued by the IASB and addresses accounting for leases which are fully within the scope of that standard.

ED 75 proposes a right-of-use model for lessees under which they are required to recognise:

  • a right-of-use asset because they control the right to use the underlying asset; and
  • a lease liability because they have a present obligation to make future lease payments in accordance with the underlying lease contract.

ED 75 proposes that both the right-of-use asset and lease liability be measured at cost (which is determined by the present value of the future lease payments).

ED 75 does not propose significant changes for lessors, instead proposing to substantially carry forward the lessor accounting currently required in IPSAS 13 Leases (which is also consistent with IFRS 16).

The XRB’s Policy Approach to Developing PBE Standards establishes a rebuttable presumption that the NZASB will adopt a new or amended IPSAS, therefore your feedback to help us influence the development of the international standard is important.  Prior to issuing a New Zealand standard based on the final IPSAS pronouncement we consult with you again.

IPSASB Request for Information

In the public sector, leases are often entered into by an entity at below-market terms. These leases are referred to as concessionary leases. It is also common for entities to enter into other arrangements similar to leases where rights to access or use assets are transferred, but which do not meet the definition of a lease under IFRS 16.  

The RFI has been issued to gather constituent input on the characteristics of concessionary leases and other arrangements similar to leases entered into by public sector entities and how they are currently being accounted for. Feedback received on the RFI will assist the IPSASB in determining whether additional standards-level or other guidance is needed for these types of arrangements.

The New Zealand Accounting Standards Board (NZASB) encourages you to read ED 75 and the RFI and to comment on the proposals.

Commenting on the Proposals

This is your opportunity to comment on this ED. 

Comments on the ED are due to the NZASB by 22 April 2021 

Comments on the RFI are due to NZASB by 28 April 2021

Comments on both the ED and RFI are due to the IPSASB by 17 May 2021

Send your comments—both formal and informal—to the NZASB using the secure upload form below.

We also encourage you to send comments directly to the IPSASBwith a copy to the NZASB. Your comments can be made electronically on the IPSASB website by clicking on the following link https://www.ipsasb.org/consultations-projects/open-public-consultations. First-time users must register to submit electronically.

Upload your submission here

Please use this secure online form.

It has been designed to make your upload safe, quick and easy. 

You can:

  • Upload an MS Word document (and a PDF file, if you wish); or
  • Write your comments below in the space provided.

You can upload up to TWO documents. 

Please note:

  • We would appreciate receiving a copy of your comments in electronic form (preferably Microsoft Word format).  This helps us to more efficiently collate and analyse comments. Please also specify the exposure draft number and title in your electronic file. 

  • Tell us on whose behalf you are making the comments (for example on behalf of a group or an entity).

  • We intend publishing all comments on the XRB website, unless they may be defamatory. If you have any objection to this, we will not publish them. However, they will remain subject to the Official Information Act 1982 and, therefore, may be released in part or in full. The Privacy Act 1993 also applies.

  • If you have an objection to the release of any information contained in your comments, we would appreciate you identifying the parts of your comments to be withheld, and the grounds under the Official Information Act 1982 for doing so (for example, that it would be likely to unfairly prejudice the commercial position of the person providing the information).