Comparative Study Of The Ifrs And Usgaap Conferinta Craiova 2015 [632017]

COMPARATIVE STUDY OF THE IFRS AND US –
GAAP REGULATIONS REGARDING THE LEASING
OF FIXED ASSETS

HOGMAN IOAN -ALIN
Universi tatea de Vest Timisoara, Facult y of Economics and Business Management,
Timisoara, , Romania
E-mail: [anonimizat]

MATEȘ DOREL
Universitatea de Vest Timisoara, Faculty of Economics and Business Management,
Timisoara, , Romania
E-mail: [anonimizat]

Abstract
The leasing is a method of renting cars, equipmen ts, transport means as well as
other assets of the fixed assets category from the f inance companies by the companies
which do not have the necessary funds to purchase them .
Roberto Rouzi stated that "leasing is a medium and long term funding operation
based on a leasing contract of assets . This operation is conducted through a financial
interme diary, mediator between the assets producer and their user, purchasing the assets
from one and putting the assets in operation at the other . The user commits to pay to th e
intermediary based on a determined payment installments , the price of the rental which is
higher than the equipment price, and at the end of the contract the ownership right can
be transferred from the financial intermediary to the user, at the latter’s initiative ".
The present paper proposed to carry out a comparative study about the approach
method of the leasing contracts from the perspective of both the funder and beneficiary in
accordance with the provisions of the IFRS and US-GAAP respectively .

Key words :
leasing, fixed assets , IFRS, US -GAAP;

JEL code :
D21, D24 ;

INTRODUC TION
Leasing is a method to rent cars, equipment, transport means as well as assets of
the fixed assets category from financial companies by the companies which do not have
available the funds for purchasing them .
Throughout the leasing contract, the assets are subject to the leasing company ’s
ownership which also cashes the instal lments agreed through the contract . At the end of
the contract, there are three options ava ilable : to extend it, to terminate it or to purchase
the assets based on their residual value (after deducting the depreciation ).
Leasing is different fro m usual rental as the usual ren tal deals with assets which
maintain their original characteristics, an d the rental rates installments do not consider the
assets ’ wear due to the time passing, while leasing deals with assets to which wear occurs
with the time and thus their value is diminished .
Secondly, the payment of a usual rent represents the value of t he right of use
while the leasing installment payment represents the weight of the equipment value
revealing the diminution of its utility with the time .
Also, the user of the equipment subject to leasing, aft er a period of time ( usually
at the end of the leasing contract ), may become the owner of the leased assets and, in
exchange, it has to pay only the residual value, which is not possible in case of a rental
contract .
Leasing of equipment consists strictly of the funding of the part of the assets value
which is expected to be used throughout the leasing period and does not require the
payment of an amount of money at the time of the asset evaluation, and at the same time
there is possible to purchase the assets at its residual value at the end of the lea sing
period .
The credit means that the bo rrower has to offer some assets as guarantee while the
equipment under leasing contract is deemed as guarantee itself .
In case of operational leasing, the equipment is not stipulated in the balance -sheet
which resul ts in the improvement of the user’s financial indicators, but the payment of the
installments involves the currency exchange rate risk, and the purchase of the assets at the
end of the leasing period is based on the exchange rate of that date .
In conclusio n, the total cost of an asset purchased through financial leasing is
higher than the credit contract option .
However, the leasing operation has several advantages :
· The guarantee based on other assets is not necessary ;
· The leaseholder’s financial resources are not blocked throughout the
contract period ;
· The tax deduction of the expenses generated by the leasing contract ;

Despite of the advantages and disadvantages associated to the two funding
options, we cannot absolutely state that one option is better than the other one , and the
selection of the option lastly depends on the client’s needs and the asset to be purchased .

SPECIALIZED LITERATURE
Specialized literature before 1980
Given that leasing is very wide spread and constitutes an option which m ost often
used to the disadvantage of bank credit, the literature comprise a lot of studies, papers and
books dealing with this subject .
Thus, assuming an ideal and utopic case of capital markets, Modigliani and Miller
in 1958 published a study showing th at the funding method is not relevant and has no
impact on the total value of the company patrimony if an investment opportunity occurs .
In 1976, the theoretical model of Myers, Dill and Bautista indicated in a first stage,
that the debt and leasing can be substituted and they submitted a leasing model compared
to the purchase option . Even if there are some special charges applied to corporations, the
selection of credit or leasing can be irrelevant taking into account the amount of general
charges as well as the fact that there are no imperfections on the market .
This study indicates that leasing can be advantageous both for the buyer and for the
seller if the tax percentage applied to each party involved in the process is different .
Actually, the model has a parameter which represents the equivalent b etween debt and
rent. The value of this parameter ranges between 0 and 1 . In other words, the equivalent
of debt and rent can be 1 € for euro or 1 € paid as rent can be the equivalent of less than 1
€ debt. How ever, the model does not take into account the possibility that the parameter
has negative values . In other words, the l easing option allows the entity to accumulate
more debt than it would prefer a classic credit option .

Recent specialized literature
In 2009, Eisfeldt and Rampini, designed a model for increasing the debt level if
selecting the leasing option . This model is based on the advantage offered by leasing
funders who are available to conclude contracts with entities having low financial
resource s. But this advantage is diminished by the separation of the notions related to the
ownership and control of assets making the object of the leasing contract . The net
advantage allows the funders to conclude leasing contracts with some entities which are
limited to such contracts to the disadvantage of bank credits and they choose in their turn,
to allocate a higher percentage of the investment capital as leasing than the entities which
do not face such financial difficulties . Thus, debt and leasing can be substituted .

In 2012 Rauh and Sufi carried out a study regarding the factors with determining
impact on the capital structure focusing on the assets used for production process and
concluding that it is obvious that debt and leasing represent commitments of either the
creditor or leasing beneficiary with impacts on the cash flow regardless the debt is the
object of a leasing contract or not and if other debts are complementary or can be
substituted .
Once the leasing contracts occurred, there were identified the cases when some
economic entities made investments in excess and others faced investment deficit . Given
that leasing is associated to a certain asset, it can help the economic entities to avoid the
cases when too many monetary resources are allocated for investments . Also, th ere is
another issue related to the separation of the ownership and control on assets making the
object of leasing contracts .
However, the leasing has a unique characteristic regarding the information it
provides . By definition, th e ope rational leasing is off balance –sheet . From economic
point of view, it is not clear why the off balance -sheet funding proves to be more
important , but the economic entities seem to accept such transactions and even to bear
significant transaction cos ts to facilitate such leasing contracts types .
In another approach of the correlation between leasing and debt, in 1986, Bayliss
and Diltz made a poll asking the bank employees to state their opinion whether th ey were
available or not to grant bank credits to the economic entities under different
circumstances taking into account the leasing contracts that each economic entity
concluded throughout the years .
Thus, they came to the conclusion that in some case s, the debt level of the entities
could be reduce d by 15% if deciding to sign a leasing contract at the disadvantage of
taking a bank credit . Other studies performed by Marston in 1988 and Beattie in 2000
revealed that the same debt capacity can be reduced with percentages ranging between 40
and respecti vely 77% under certain conditions .
MET HODOLOGY AND DATA
Referring to the investigation methods, in the present study the most frequently
used method is the comparative one, and the arguments sustaining this method include
the fact that it allowed to ident ify the existing similarities and the dissimilarities between
the International Standards of Financial Reporting and the Generally Accepted
Accounting Principles of the United States (US-GAAP). Based on the comparison made
there were identified the similar ities and dissimilarities between the two accounting
standards .

Also, the method of the document review is not less important as the analysis of
the reference sources used, of the comparative studies as well as the interpretations of the
specialists from the national and international literature allowed us to analyze the
approached issues as well as the observation method by carefully and systematically
monitoring a certain event or a certain feature , parts or particular features of it (Prun,
1976).
To dr aw up the present progress report, there were also used investigation
techniques and methods as for instance : stud y of the bibliography references, review of
the important regulating acts, collection and interpretation of information to summarize
and revea l the investigation outcomes .
RESULTS
Results obtained further to overall analysis of the two regulations (IFRS and
US-GAAP) referring to the leasing transactions
The leasing transaction accountancy involves several particular features partly
arising fr om the number of options available for the parties involved in the transactions .
For instance, in many cases, the leasing contracts can be developed so as to allow some
tax benefits by modifying the leasing period and the interest rate . The leasing can be used
to transfer the right of ownership on the assets making the object of this type of contract
and to transfer all or some of the risks associated to the ownership right . The challenge
incurred by the financial reporting is that the accounting method of dealing with leasing
contracts should be determined depending on the specific components of each such
contract .

The accounting approach of the leasing is one of best examples of application of
the substance prevailing the form as described in the IASB . If at the end of the leasing
contract the ownership on the assets is transferred to the user, the object of the transaction
is sales -purchase of the respective assets and should be recognized as such even if it i s
based on a leasing contract which basically, gives the user only the right of use on the
assets in discussion .

The IFRS provisions referring to the leasing accountancy are not so elaborated
like some of the general princi ples accepted by some countries , but rather represent a fair
approach . Despite all these, by applying the IFRS , not all the leasing contracts can be
capitalized , that is they cannot be dealt with from the corresponding asset and debt point
of view, and further to the amendment of the leasing contract terms specific accounting
appro aches can be applied to operational contracts which are often preferred by the
lessees .

IFRS refer to almost all types of existing leasing contracts, but the followings
make particularly exception :
1. The leasing contracts concluded for the exploitation or use of the natural
resources such as oil, natural gas, ores, wood, etc .
2. The license contracts for cinema production, video recording, scenarios,
manuscripts patents and copyrights ;
Currently, the IFRS does not provide any regulations regarding the accountancy
of the rights of mineral resource exploitation and use, and referring to IFRS 6 which
regulates the accountancy of the mineral resource exploitation and evaluation, it does not
regulate the leasing of these activities .
Referring to the economic entities applying the US-GAAP provisions , it is
necessary that the lessee initially apply the ASC 810 p rovisions for determining the
relation between lessee and financing company . It is due to the fact that if ASC 810
regulates the eventual merg e between f inancial company and the lessee , the effects of the
leasing contract will be removed from the financial statements and the consolidated entity
will proceed to the depreciation of the assets subject to leasing and will record all the
costs incurred by the a sset purchase, storage, maintenance and decommissioning of the
asset .
In May 2013, the Council for Elaboration of International Standards of
Accountancy and the Council for the Elaboration of the Financial and Accountancy
Standards of the United States , issued the proposals for the amendment of the
accountancy standards regarding the leasing the its approach which, if approved, will
amend the current leasing approach impacting all the economic entities .
The proposed amendments provide that all the assets as well as the elements of
liabilities type making the object of leasing contracts should be recognized, with some
insignificant exceptions, in a manner similar to the provisions of 2010 . Despite all these,
according to the proposals, the leasing accountanc y depends first of all, on the
requirement whether the beneficiary of the assets making the object of the leasing
contract expects a significant depreciation of it. I f yes, the incomes and expenses
associated to the transaction can be accelerated . If not, the same incomes and expenses
can be recognized in a linear manner . For instance, the real estate properties making the
object of leasing contracts, cannot usually depreciate significantly throughout the contract
development and thus, the incomes and expen ses will be recognized in a linear manner .
On the other hand, the technological equipment making the object of leasing contract can
be significantly depreciated throughout the leasing contract development and thus, the
incomes and expenses can be recognize d based on the effective interest rate method .
The effective interest rate method is a method used to calculate the amortized cost
of an asset and that of the allocation of profit resulted from interest rates during the
relevant period . The effective inter est rate represents the rate updating the future expected

cash flows received throughout the expected asset life or where applicable, throughout a
shorter period, the net accounting value of the asset . When calculating the effective
interest rate, an entit y will estimate the cash flows considering all the contracting clauses
of the assets in discussion (for instance the down payment ), but will not take into account
the future losses .
It is to be noted that when calculating the effective interest rate, it is compulsory to
take into account all the fees paid or cashed from the contracting parties, the transaction
costs and all the other bonuses or discounts .
As for the l easing, in order to determine the similarities and differences between
the issues revealed by IFRS and US GAAP, for this study purpose, we complied with the
provisions of the IAS 17 Leasing and IAS 40 Real Estate I nvestments as well as with the
provisions of ASC 840 Leases of US GAAP.
Anal ysis of the leasing contract definition and classificatio n

Thus, in accordance with the IFRS provisions, the leasing consists of a contract by
means of which the funder and the producer of an asset grant the right of use on the
respective asset to a be neficiary for a mutually agreed determined period of time a nd in
exchange the latter will make installments payments on the dates established by the
parties1. Also, in compliance with the provisions of the IFRIC 4, a convention concluded
between the parties can be assimilated to a leasing contract when the clause s and
provisions of the convention meet in a cumulative manner, two requirements : the object
of the contract consists of the use of some assets and at the same time, the contract
stipulates who has the right to use those assets making the object of the c onvention signed
by the parties .
On the other hand, the provisions of the American accountancy standards are
similar, except for the fact they refer only to the right of use related to the tangible assets.
Thus, the IFRS provisions cover a wider range of lea sing contract such as the intangible
asset leasing2.
A leasing contract can be classified either as operational or financial at the time of
the leasing operation start up as per the IAS 173. The date when the leasing operation
starts is the earliest date b etween the leasing contract signing and the date on which the
contracting parties agree upon the main clauses of the leasing contract . Referring to the
classification of the leasing contracts there are no differences between IFRS and US
GAAP provisions, as the American standards include the same stipulations regarding the
time of the leasing operation start up .

1 IAS 17.4
2 ASC 840
3 IAS 17.13

Referring to the classification of the leasing contracts as operational or financial,
IAS 17 stipulates that the financial leasing is that which tr ansfer all the risks as well as
the benefits arising from the ownership right on an asset to the beneficiary taking into
account that an operational leasing does not carry out such a transfer4. The American
accountancy standards provide that a financial le asing also transfer all the risks and
benefits resulting from the asset ownership right , but only based on some criteria
fulfillment . All the other leasing types are deemed to be operational .
In accordance with IAS 17 a leasing is considered financial lea sing if it fulfill at
least one of the following requirements5:
· Transfer of asset ownership making the object of the contract can be done
before the end of the contracting period ;
· The beneficiary may purchase the assets at a price which sufficiently low
compared to the fair value at the end of the contracting period ;
· The leasing contract include most of the asset life time even if the
ownership right is not transferred ;
· The assets making the object of the leasing contracts have particular
characteristics s o that only the beneficiary can use them without making significant
modifications of their characteristics ;
· The totalized current value of the minimum installments established on the
date of the leasing operation start up is at least equal with the fair va lue of the leasing
contract ;
· If the beneficiary has an option to terminate the contract prior to the due
term, all the prejudices caused to the funder, namely losses he is facing as a result of the
failure to comply with the leasing contract provisions, wi ll be charged on the beneficiary ;
· The beneficiary has the option to extend the leasing contract and to pay a
significantly smaller installment compared to those practiced on the market .
Generally, the requirements provided by ASC 840 regarding the financia l leasing
are similar to those provided by IFRS and IAS 17 , too . However, the American
accountancy standards are less detailed in the sense that a financial leasing meets at least
one of the following requirements according to US GAAP6:

4 IAS 17.8
5 IAS 17.10
6 ASC 840 -10-25-1

· The leasing contra ct provide the transfer of the ownership right to the
beneficiary until the end of the contracting period ;
· The contract stipulates the option of purchasing the assets at a significantly
lower price ;
· The contracting period is at last equal to two thirds of the estimated life
time of the asset making the object of the contract . This provision does not apply if the
leasing starts in the last quarter of the asset life time ;
Unlike the IFRS, ASC 840 specifi es that the funder must fulfill the following
requireme nts to classify a leasing contract as financial 7:
1) There are no obvious uncertainties regarding the cashing of the leasing
installments ;
2) There are no significant uncertainties regarding the non -reimbursable costs
which have not been yet recorded by the f under as effects of the leasing contract .
The analysis of the similarities and differences between the IFRS AND US
GAAP provisions regarding the accounting approaches applied to the leasing
contracts
Referring to the accounting approaches applied to the leasing contracts, further to
their due diligence review, several similarities and differences between the two
accounting standards have been identified .
Thus, according to the IFRS, regarding the operational leasing , from the point of
view of the benefic iary, the installments paid within the leasing contract are considered
expenses and from the funder point of view, the revenues resulting at the leasing
operations are recognized in a linear manner and systematically throughout the leasing
contract period8.
If a discount or a price cut is granted, they will be recognized as diminution of the
expenses from the be neficiary’s point of view or of revenues resulted from the rents
associated to the leasing contract from the funder point of view. .
US GAAP deals in a similar manner, with the revenues, expenses and discounts as
indicated by ASC 840 -20-25-1, 25 -6 and 25-7 provisions .
However, referring to the accounting approaches and considering the leasing
lessee point of view, the financial leasing as dealt with by the IFRS respectiv ely the
capital leasing dealt with by US-GAAP , several differences have been found as follow .

7 ASC 840 -10-25-42
8 IAS 17.33

In case of the IFRS, at the beginning of the leasing period, the initial recognition
of the asset will be based on the fair value or on the hig hest value between the fair value
and the current value of the minimum payments associated to the leasing contract9. The
current value is usually calculated using the interest rate . If the use of the interest rate is
not practical, then the margin interest rate will be used . The capital assets making the
object of the financial leasing contract are depreciated using the same method like the one
used for the patrimony assets . If it is not certain that the beneficiary will have the
ownership right on the asse ts in discussion, the depreciation will be carried out within the
shortest period whichever come first, between the leasing contract duration and asset life
time. The minimum leasing installment payments are distributed between the funding
costs and the di minution of the outstanding debts, and the funding costs are distributed by
each period so that there will exist a constant payment obligation for the existing debt10.
On the other hand, the American accounting standards provide that in case of
capital asse t leasing, the asset will be initially recognized at the current value of the
minimum leasing installments or at the highest value between the current value of the
minimum payments and the fair value of the asset making the object of the leasing
contract11. To calculate the current value of the asset, the margin interest rate is used in
principle. Despite this, if there can be identified the interest rate implicitly associated to
the leasing contract and if this amount is lower than the margin interest rate, the implicit
interest rate must be used . If the leasing contract include a provision regarding the option
to purchase the asset at a significantly lower price or stipulates that at the end of the
pleasing period the ownership right is obtained by the bene ficiary, the depreciation of the
financial leasing assets will be performed throughout the asset life time . On the contrary ,
the asset depreciation will be done throughout the leasing contract duration . The
minimum leasing payments are distributed among th e diminution of the existing debt as
well as the expenses incurred by interest rate so that the payments are constant
throughout the leasing period12.
The lessor of the assets making the object of the leasing contracts, according to
the IFRS provisions must recognize the assets making the object of financial leasing
contracts as c laim in the balance –sheet at an equal value to that of the net leasing
investment which represents the gross leasing investment deducting of it the implicit
interest rate13. The gros s leasing investment represents the minimum payments including
the non -guaranteed residual value of the asset . The revenues associated to the leasing
contract will be recognized so that to reflect a constant and periodical reimbursement at a

9 IAS 17.20
10 IAS 17.25
11 ASC 840 -30-30-1..-4
12 ASC 840 -30-25-2
13 IAS 17. 4

certain percen tage of the investment made by the lessee14. The lessee producers or dealers
will recogn ize the profit or loss in the result of the financial year in accordance with the
policies used by them . In case of direct sales, the initial costs are recognized as exp ense
sin the profit and loss account at the time when the profit associated to the sales is
recognized15.
The recognition of the assets making the object of the leasing contract according
to the US GAAP provisions is as follows :
1) In case of the financial le asing of sales – purchase type, the net investment
consists of the gross investment of which the non cashed interest rate is deducted . The
gross investment consists of the minimum leasing payments and the net costs associated
to the contract execution to w hich the non -guaranteed residual value which may
constitute a lessor’s benefit, is added . The non -cashed interest rate represents the
difference between the gross investment and the current value of the gross investment
determined using the implicit inter est rate of the leasing contract . The producer’s or
dealer’s profit, for such type of leasing contract, is the difference between the current
value of the minimum leasing payments and the direct costs assigned to the assets making
the object of the leasing contract together with any initial direct costs , of which the
current value of the non -guaranteed residual value is deducted . For this type of sales –
purchase leasing contract which object de als with real estate properties , special
regulations are applied16.
2) In case of leasing with direct funding, the net investment consists of the
gross investment to which any initial direct non -amortized costs are added and the non –
cashed interest rate is deducted . The gross investment consists of the minimum leasing
payments and net costs for the contract execution , to which the non -guaranteed residual
value that could constitute a lessor benefit is added . The difference between the gross
investment and the costs associated to the assets making the object of the leasing contract
will be recorded by the lessor as non –cashed revenues . The revenues of the lessor
associated to the leasing contracts with direct funding are calculated using a percentage of
the interest rate and will generate a constant reimbursement of the inv estment throughout
the leasing contract development17.
3) Also, unlike the IFRS, the US GAAP discusses and regulates the
leveraged leasing contract where the lessor (supplier) of the asset making the object of
the leasing contract, borrow a part of all the mo ney required to purchase the asset , the

14 IAS 17.9
15 IAS 17.42
16 ASC 840 -30-30-8..-10
17 ASC 840 -30-30-11

leasing contract constuting a guarantee for the loan. This type of leasing contract is often
used for the transactions associated to some high value assets18.
Anal ysis of the leasing approach related to the buildings and lands
Other differences found as a result of the analysis refer to the leasing of buildings
and lands .
Thus, according to the IFRS provisions , the lands and buildings are rec ognized
separately, except for the case when the amount that would be recogni zed initially for the
land is not important . In such case they will be dealt with as a single unit19.
In accordance with the US GAAP regulations, both the building and land leasing
is considered . In all cases, the ownership right is transferred to the lessee and the
purchase option at the end of leasing contract is revealed20.
This type of leasing will always be classified as financial leasing, regardless the
value of the land, and if the fair value of the land at the transaction start up represents at
least 25% of the total fair value of the leasing contract, the lessee must consider the land
and construction separately .

Analysis of the leaseback contract
Referring to the recognition of a profit or loss in case of the operational leaseback
type leasing , IFRS indicates that all the profits or losses are recognized at the time of their
achievement , being subject to the value adjustment if the selling price differs from the
fair value .
If the user has an insignificant right of use of the leasing asset , it will recognize in
advance the revenues or expenses that will be amortized throughout the leasing contract
duration . On the contrary, it could partly or totally recognize the profit proportionally to
the rights of use held21.

On the other hand, the US GAAP indicates that in case that the seller does not
give up more than a small part of the asset right of use, any profit or loss is generally
postponed and amortized on long term . On the contrary, the profits or losses can be
recognized in percentages depending on the amount of the right of use awarded22.
As for the recognition of a profit or a loss in case of the financial leaseback
leasing , IFRS indicates that the revenues and expenses are recognized in advance and are

18 ASC 840 -10-25-43
19 IAS 17.16
20 ASC 840 -10-25-60
21 IAS 17.59
22 ASC 840 -40-25-3

amortized throughout the leasing contract while the US GAAP ap plies the same rules like
tje operational leaseback leasing .

CONCLU SIONS
Due to the fact that currently the large size American corporations rank at
the top of the multi -national companies, the American standards become an important
element of the world accounting system which is more and more often adopted
worldwide.. As the majority of the corporations are based in USA , and the American
market of capital is particularly important at the world level , US GAAP becomes a very
significa nt element for the medium and long term enterprises .
The international accounting amortization itself through the investigations
performed is strongly influenced by the accounting approach from USA through the
FASB, the American accountancy regulating body .
Since 2002, at the meeting organized at Norwalk, USA , the two accounting
regulating bodies IASB and FASB a greed on the start up of a process of diminution and
elimination of differences between the two standards , process known as convergence .
Certainly , the existence of some accounting common standards at world level is
required given the current globalization process and at the same time, common
interpretations of those standards are required so that IASB and FASB deal with sim ilar
issues in a similar manner .
Further to the analysis conducted within this paper, I noticed that despite of the
efforts made regarding the convergence between the two accounting standards there still
are notable differences . Thus, although the IASB proceeded with the updating of the
IFRS in order to work out several convergence issues there still exist differences between
the two standards particularly regarding the accounting policies of the enterprises as well
as the approach of the immobilized asset depreciation .
However, the elaboration of some accounting standards uniform at world level
will depend on the cooperation of the bodies and authorities involved in the project .
Both FASB, and IASB have made significant progress to the finalization of the
convergence process so far and the two bodies work on some other major common
projects .
Even if the efforts for the finalization of the convergence between IFRS and US
GAAP are sustained, finally there won’t be eliminated all the differences between the two

standards . We made t his statement considering that there still are differences between the
standards for which the convergence process has been finalized .
Once the last report about the convergence process was published by IASB and
FASB in February 201323, referring to the le asing, the two organizations specified that
further on, this type of transactions represent a significant source of off balance sheet
funding source .
The final objective of the project aiming at the leasing convergence is mainly to
recognize leasing withi n the balance –sheet accounts improving thus the financial
reporting method used by the lessors and lessees and implicitly provide a better picture of
the social –economic situation of the entities .
Further to the finalization of the discussions about the convergence process of the
accounting approach of leasing , the committee will issue proposals subject to review by
entities and the date of the convergence project finalization will depend on the feedback
given by the entities applying the standards .
Takin g into account the above described, Awe think it is possible that the
convergence process do not meet the expectations regarding the differences between the
two accounting standards . This is due to several determining factors among which we
mention :
– existing political factors within both IASB, and FASB;
– reluctance of the American organizations against the adoption of the IASB
recommendations ;
– political pressure both from EU and USA for the personalization of the
standards issued as a result of the convergence process .

BIBLIOGRAFIE
1) Agrawal V., Ferguson M., Is leasing greener than selling? , Management Science;
Mar2012, Vol. 58 Issue 3, p523 -533;
2) Andreica M., Leasing – cale de finanțare a investițiilor pentru întreprinderile mici și
mijlocii , Ed. Grimm, București, 1997;
3) Clocotici D., Operațiunile de leasing , Ed. Lumina Lex, București, 2000;
4) Deaconu, A., Standarde contabile pentru întreprinderi mici și mijlocii , în
lucrarea: Profesia contabilă și globalizarea , Ed. CECCAR, București, 2006;

23 http://www.ifrs.org/Use -around -the-world/Global -convergence/Convergence -with-US-
GAAP/Documents/IASB -FASB -G20-Update -February -2013.pdf , pag.4

5) Eisfeldt A., Rampini A. , Leasing, ability to repossess and debt capacity , The
review of financial Studies, Vol. 22, No. 4 (Apr., 2009), pp. 1621 -1657;
6) Myers S., Dill D., Bautist a A., Valuation of financial lease contracts , The
Journal of Finance, Vol. 31, No. 3 (Jun., 1976), pp. 799; Editura Mirton, 2007;
7) Tita-Nicolescu G., Regimul juridic al operațiunilor de leasing , Ed. All Beck, București,
2003;
8) ***, FASB, US-GAAP, ASC 840 – Leases;
9) ***, IASB, IFRS, IAS 17 – Leasing;
10) * * * http://www.ifrs.org/Use -around -the-world/Global -convergenc e/ Convergence -with-
US-GAAP/Documents/IASB -FASB -G20-Update -February -2013.pdf