ASCG comments on IASB Request for Information / Post-implementation Review of IFRS 16 Leases

On 14 October 2025 the ASCG submitted its Comment letter on the Request for Information as part of the Post-implementation Review of IFRS 16 Leases to the IASB.

Our overall assessment of the standard is positive. We think that IFRS 16 is meeting its objective, its core principles are well understood and that lessees and lessors provide relevant information about their leases in a manner that faithfully represents those transactions. Therefore, we think that the standard is working as intended and that the overall improvements to the quality and comparability of financial information about leases are largely as the IASB expected.

However, we do not agree with the IASB´s assessment that the ongoing costs of applying the measurement requirements in IFRS 16 are largely as expected. We think that the ongoing costs are significantly higher than expected, which results particularly from the necessary data management for the leases and the maintenance of the utilised leasing tool.

Our biggest point of criticism, however, relates to the ongoing costs incurred for issues that involve a lot of time and effort but where the resulting (added) information might be immaterial. As for proposals to reduce these costs without a significant negative effect on the usefulness of financial information about leases, we suggest the IASB to raise the threshold for leases of low-value assets and to change the wording of IFRS 16.26 to permit the use of the incremental borrowing rate as standard practice for discounting the lease payments.

In summary, we highlight that, after initial challenges, preparers have developed accounting policies and processes for the key issues that are working well in practice. As we did not identify a need for significant changes to IFRS 16, we are convinced that fundamental changes to the standard should be avoided by the IASB, as these would be likely to cause further disruption and outweigh the benefits of the changes and the improvements achieved.