1. IFRS vs. US GAAP IAS 17 vs. FAS 13 as amended many times

2. Continued on next slide Note that IFRS has no “bright line” rules

4. IFRSUS GAAP For LessorOperating lease Finance leaseDirect Financing Lease Finance leaseSales-type lease Finance leaseLeveraged lease For LesseeOperating lease Finance leaseCapital lease

6. Type of Lease Accounting Treatment for Initial Direct Costs Operating Recorded as an asset and amortized over the lease term* Direct Financing (US) Finance (IFRS) Recorded as part of investment in lease and amortized over lease term by reducing interest revenue (find new implicit rate)* Sales-type Lease (US) Finance if lessor is manufacturer or dealer (IFRS) Immediately recognized as cost of goods sold (reduces profit or increases loss on sale of leased asset)