Leases often come with end-of-lease obligations or costs beyond periodic rent. Two common examples are dilapidation or restoration obligations (returning the asset or premises to a specified condition) and asset retirement obligations (AROs) (legal requirements to dismantle or remove the leased asset or restore a site at the end of the lease, such as decommissioning costs for equipment). These obligations are not payments for the right to use the asset itself, but are associated with what happens after the lease term or as a result of using the asset. Accounting for these costs typically falls under provisions or contingent liability standards rather than purely under leases.

8. Obligations Beyond the Lease