Looks like FASB is listening very seriously to the comment letters on leases. They seem to be backing off on some of the strongest components of the lease revisions. (See Update below!)
In February they tentatively decided to distinguish between two types of leases – finance and other-than-finance. The other-than-finance leases will be recognized in a manner similar to a current operating lease. Seems to me that is a massive change in direction.
The board is also revisiting what renewal terms should be included in the calculation. Summary of the FASB’s tentative decisions is here.
The previous proposal would have required every lease to be recorded in the same way that capital leases are currently recorded – book an asset and liability equal to the present value of payments. In addition renewal terms would have had to be included in the calculation for any extensions that are “more likely than not” to be exercised. See my previous discussions here and here.
Hat tip to Tammy Whitehouse at Compliance Week. For more detail, see her article – FASB Retreats Again, This Time on Leasing.
UPDATE – looks like a major assumption on my part is sort-of-not-quite-correct. Well, actually completely wrong. See updated discussion here where the FASB chair mentions in an interview that there has not been any major change by FASB.