Lease accounting for the transportation and logistics industries changes with the new standards. Transportation and logistics companies lease a diverse range of assets from storage units to airplanes and ships.
The new leasing standards require transportation and logistics companies to update their accounting policies based on the new principles. In some cases, extensive analysis may be required to arrive at judgments on how to apply the standards to certain lease types.
1. Does an agreement for partial use of a transportation or storage asset constitute a lease? Consider arrangements such as an agreement for shipping capacity or oil tanker capacity.
2. How are complex terminal leases at airports affected by the new leasing standards? What about terminal subleases? Consider the additional lease components in a terminal lease such as moving rails and boarding ramps, as well as non-lease components such as landing rights.
3. How are complex railcar asset utilization structures, such as right-of-way agreements, non-billable days, variable payments, sale leaseback transactions, and asset retirement obligations impacted by the new standards?