The FASB has completed its post-implementation review of the leases standard, revealing both successes and unexpected costs. While investors are getting more useful information, the initial and ongoing costs were higher than anticipated.
Key Points
•📅 Date: November 20, 2025
•📊 Key Players: FASB, Richard R. Jones, Jackson M. Day
•💵 Cost Alert: Initial and ongoing costs higher than expected
•👥 Stakeholders: Outreach with over 1,600 individuals
•📈 Outcome: More useful information for investors
📜 The Review Process
The Financial Accounting Standards Board (FASB) issued a report on its post-implementation review of the leases standard (Topic 842). This process is a crucial quality control step to ensure that the standard is meeting its objective by providing relevant information to investors and financial statement users while justifying the costs involved.
🗣️ Stakeholder Engagement
FASB Chair Richard R. Jones and Technical Director Jackson M. Day acknowledged the significant effort required for the high-quality implementation of this major accounting standard. They emphasized that while the Leases PIR process is complete, the FASB's work on the leases standard continues. The review involved outreach with more than 1,600 individuals from diverse backgrounds.
💡 Key Findings
The report highlights that the leases standard generally achieves its goal of offering investors more useful information about lessees' leasing activities. However, the initial and ongoing costs to implement these requirements were significantly higher than expected. This was mainly due to existing systems and processes not being equipped to handle operating leases on the balance sheet.
📊 Investor Satisfaction
Investors are generally pleased with the information provided under the lessor accounting requirements. Most lessor entities did not face significant costs to implement or maintain these requirements. The report is available on the FASB's website for those interested in a deeper dive into the findings.
