Modern lease accounting can involve a variety of related transactions and special scenarios that require guidance beyond the core lease standard. This chapter examines these complexities under IFRS, U.S. GAAP, and FRS 102 (UK GAAP). The discussion is organized into seven sections:

Changes over time: Treatment of lease modifications and remeasurements (including those triggered by index changes or option reassessments).
Cash flows that aren’t really lease payments: Handling of security deposits, lease incentives, and variable lease payments.
Obligations beyond the lease: Accounting for dilapidation and restoration obligations and asset retirement obligations (AROs) associated with leases.
Asset-side complications: Addressing impairment of right-of-use assets and foreign exchange impacts on lease liabilities and ROU assets.
Boundary problems: Complex scenarios like embedded leases in service contracts, subleases (when the lessee becomes an intermediate lessor), and sale-and-leaseback transactions.
Sales Taxes and Lease Accounting, e.g. where there are recoverable and non-recoverable sales taxes involved.
Prepaid Expense Management and Lease Accounting.

5. Specific Lease Scenarios