University of agribusiness and rural development, Regional development of Central and Eastern European countries

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Some issues of methodology and application of accounting for lease contracts
Liliya Rangelova

Last modified: 2015-10-12


Lease as a kind of financial transaction that facilitates the use or acquisition of an asset has wide practical application in our country. The lack of agreement between the content of the accounting and legal categories for lease originates some problems of their accounting, which have to find an adequate solution. For this reason, issues related to clarifying the nature of the lease from legal, economic and accounting perspectives are considered, emphasizing on the perceived neutrality of the accounting compared to the legal treatment, in accordance with the application of the principle of economic substance over legal form. Guidelines are provided in the paper for the proper implementation of the requirements for initial classification of leases as finance or operating leases; the accounting treatment of the early termination of finance leases, and the treatment of financial lease contracts booked in accordance with applicable accounting standards.


lease, contract, accounting

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