NORWALK, CT—On Wednesday, the US Financial AccountingStandards Board and the International AccountingStandards Board will have another go at putting to bed aconverged standard for lease accounting. The meeting, scheduled forWednesday, April 24, follows a series of talks earlier this year that made some-buthardly enough-progress towards a resolution on this long-standingaccountings project.

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According to FASB's announcement of the meeting's agenda on itswebsite, the Boards will discuss lease modifications and contractcombinations, variable lease payments, in-substance fixed payments,and the discount rate.

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Left unresolved from the last talks in the March is theoverarching of question of whether there should be a singleapproach to recognize leases, or a duel-recognition approach,depending on the type of lease. With a dual approach, the leaseswould qualify as either Type A or Type B. The latter are mostlikely to be used by real estate companies, as it would allow for astraight-line expensing method with the asset returned to the ownerat the end of the term.

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Waiting for a standard is wearing on the industry's nerves; asurvey from Deloitte at the beginning of this yearfound that among real estate lessees, confidence in their IT andcompliance preparations for the new standard has fallen, with onlyone percent "extremely" or "very" prepared to comply in 2013, downfrom nine percent in 2011.

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The survey also found that executives across many industries,not just real estate, anticipate the new standard to havesignificant financial reporting effects, with 58% expecting asignificant impact on their balance sheet and 53% ondisclosures.

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Nearly half of executives also cited an effect on financialratios, with significant effects on debt to equity (71%) and returnon assets (52%) cited by these respondents. The impact on lesseesappears to be more severe than on lessors, with the former groupfar more likely to cite these impacts.

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