The IASB and FASB Stumble Over the Annuity Method of Depreciation
Accounting in Europe, Vol. 11, No. 1
5 Pages Posted: 17 Sep 2013
Date Written: September 16, 2013
Even though the IASB and the FASB avowed that they would not use the annuity method of depreciation in their leases exposure draft of May 2013, they did so anyway, and with stealth. This article discusses and illustrates the annuity method of depreciation and then critically assesses how the IASB and the FASB have tried to defend their Type B lease treatment as involving a "plug figure" and not as an application of the annuity method, which it is.
Keywords: leases, depreciation
JEL Classification: M41
Suggested Citation: Suggested Citation