Proposed Lease Implementation Guide Issued for Governments

Pillars on a Government building

As the effective date for the new lease accounting rules draws nearer, GASB has released a proposed implementation guide to address the numerous questions raised on the application of and transition to the new accounting model.

The document provides authoritative guidance—Category B generally accepted accounting principles—in a question-and-answer format as well as nonauthoritative illustrations. The illustrations can help governments in making the calculations, journal entries and disclosures necessary to implement the standard. They include reporting of an equipment lease, a building lease with a lease incentive and variable payments that depend on an index. Almost every aspect of the guidance is addressed with scope, recognition and measurement and lease term generating the most questions.

Comments are due April 30, 2019, and a final guide is currently scheduled for release in June 2019.

For a comprehensive overview of GASB’s lease requirements, see BKD’s white paper, New Rules on a Government’s Accounting for Leases.

Effective Date

The more than 80 questions and answers and three illustrations provide state and local governmental financial statement preparers and other stakeholders with guidance on these topics:

  • Scope
  • Lease term and short-term leases
  • Contracts that transfer ownership
  • Recognition and measurement
  • Leases of investment assets
  • Regulated leases
  • Presentation and notes
  • Multiple components and contract combinations
  • Lease modifications and terminations
  • Sale-leaseback and lease-leaseback transactions
  • Intra-entity leases


For some governments, the adoption of Statement 87 will be complex and likely will require significant hours to implement correctly. BKD can help educate your team, provide implementation tools and assist with analysis and documentation. If you would like assistance complying with the new guidance, contact your trusted BKD advisor.



How can we help you?