How to recognize sale and leaseback under IFRS 16

A sale and leaseback transaction differs from a classic leasing transaction and is characterized by the fact that the seller-lessee sells a given asset and simultaneously takes it over on lease from a new owner. In turn, the buyer-lessor acquires the said asset and then leases it back to the previous owner.

The recognition of sale and leaseback transactions in the accounts of entities applying international accounting standards differs significantly from the recognition of leases under national accounting standards.