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Lease Project Possible Stalemate
The latest FASB/IASB Lease Accounting Project meetings on Feb. 28 and 29 had as objectives to change the lessee cost pattern to better reflect the economics (straight-line) and to see if that decision would mean changes to lessor accounting methods that had already been decided. The reason for the continued work on the lessee cost pattern is that most comment letters supported a straight-line cost pattern for what we call operating leases under current GAAP. The reason they would re-look at lessor accounting is the concern of many Board members that they consider the possible need for symmetry.
The Boards could not agree on a lessee accounting method, so they never got to the lessor/lessee symmetry issues. The lessee issue under consideration was the front-loaded cost pattern of the right of use (“ROU”) method for lessees whereby the ROU asset is amortized straight-line and interest is imputed versus the ROU liability amortizing using “effective interest method” amortization. The comment letters of virtually all preparers (lessees) and many users (lenders, debt analysts and equity analysts) received by the Boards said that there are two types of leases ' leases that transfer ownership (aka capital leases per current GAAP) and leases that merely transfer a temporary right of use (aka operating leases per current GAAP). The comments said further that the P&L cost pattern should be different with only former capital leases having a front-loaded cost pattern, while the former operating leases should have a level cost pattern. In other words, should there be two types of leases and lessee accounting methods with the ROU or former operating leases having a straight-line cost pattern? The FASB agrees, while the IASB does not. The IASB thinks that all leases should be accounted for the same, citing one of the Project's initial objectives ' to eliminate different accounting for similar leases that is an issue under FAS 13 with its bright-line PV test.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Beach Boys Songs Written Decades Ago Triggered Current Quarrel With Lawyers
There's current litigation in the ongoing Beach Boys litigation saga. A lawsuit filed in 2019 against Nevada residents Mike Love and his wife Jacquelyne in the U.S. District Court for the District of Nevada that alleges inaccurate payment by the Loves under the retainer agreement and seeks $84.5 million in damages.
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
Transfer Tax Implications on Real Property Leases
The real property transfer tax does not apply to all leases, and understanding the tax rules of the applicable jurisdiction can allow parties to plan ahead to avoid unnecessary tax liability.