The attempt to find a single lease accounting model based on recognition of a right-of-use asset is faltering. In this article, John Hepp and Mark Scoles from Grant Thornton LLP’s National Professional Standards Group suggest a control-based model as an alternative.
In this article, we outline:
- The current state of affairs
- A control-based model
- Leases that transfer control of an asset: Lessor and Lessee
- Operating leases: Lessor and Lessee
- Defining control
- Why control of the underlying asset is a better measure
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