The International Accounting Standards Board (IASB) has launched a formal post-implementation review of IFRS 16 Leases, inviting stakeholders to share their experiences and insights on whether the standard is working as intended.
A Request for Information (RFI) has been published as part of this process, with comments due by 15 October 2025.
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Issued in January 2016 and effective from January 2019, IFRS 16 introduced a major shift in lease accounting by requiring lessees to bring most leases onto the balance sheet. The standard eliminated the distinction between finance and operating leases for lessees, replacing it with a single lease accounting model. The move aimed to improve transparency and comparability in financial reporting by recognising lease assets and liabilities more consistently.
Now, more than five years since implementation, the IASB is reviewing whether the standard has delivered the intended benefits and whether the costs of applying IFRS 16 are justified. Stakeholders—including preparers, users, auditors, and regulators—are encouraged to provide feedback on key aspects such as:
- Usefulness and comparability of information when judgement is applied in measuring lease liabilities;
- The relevance of disclosures about lease-related cash flows;
- The cost and complexity for lessees in applying the measurement requirements; and
- Interactions between IFRS 16 and other IFRS Accounting Standards.
Participants are also invited to share their overall views on the effectiveness and clarity of the standard.
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Frequently asked questions
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1. What is IFRS 16?
IFRS 16 is an international accounting standard issued by the International Accounting Standards Board (IASB) that governs the accounting treatment of leases. Effective since January 2019, IFRS 16 requires lessees to recognise most leases on the balance sheet as a right-of-use asset and a lease liability, eliminating the previous distinction between operating and finance leases for lessees. The goal is to enhance transparency and comparability in financial reporting.
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2. Who is the IASB?
The International Accounting Standards Board (IASB) is an independent body responsible for developing and issuing International Financial Reporting Standards (IFRS). It operates under the oversight of the IFRS Foundation. The IASB sets standards used in more than 140 countries and aims to bring transparency, accountability, and efficiency to global financial markets through high-quality financial reporting.
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3. What is a post-implementation review (PIR)?
A post-implementation review is a standard process conducted by the IASB to assess whether a new accounting standard is working as intended. It involves gathering feedback from stakeholders—including preparers, users, auditors, and regulators—on whether the standard’s requirements are understandable, cost-effective, and provide useful information. For IFRS 16, this includes assessing practical challenges, benefits, and areas needing clarification.
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4. Why is the IASB reviewing IFRS 16 now?
The IASB typically conducts a post-implementation review several years after a major standard takes effect. Since IFRS 16 came into force in 2019, the Board is now seeking input to evaluate its real-world impact, including whether it has improved financial reporting and whether the benefits outweigh the costs of implementation and compliance.
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5. How can stakeholders provide feedback, and by when?
Stakeholders can provide feedback by responding to the Request for Information (RFI) published by the IASB. Responses can be submitted through the IFRS Foundation’s official website. The consultation is open until 15 October 2025, and the IASB encourages input from a wide range of users, including companies, investors, auditors, standard-setters, and academics.
