AREA OF FOCUS
AREA OF FOCUS
IFRS 16.
IFRS 16.
Simple in theory. Complex in practice.
Simple in theory. Complex in practice.
While IFRS 16 is already well established for many organisations, others may only now be implementing the standard as part of a first-time adoption of IFRS. Regardless of where an organisation stands, practical challenges often arise around lease identification, measurement and the ongoing accounting requirements for lease portfolios.
While IFRS 16 is already well established for many organisations, others may only now be implementing the standard as part of a first-time adoption of IFRS. Regardless of where an organisation stands, practical challenges often arise around lease identification, measurement and the ongoing accounting requirements for lease portfolios.
WHAT IS IFRS 16?
WHAT IS IFRS 16?
Bringing leases onto the balance sheet
Bringing leases onto the balance sheet
IFRS 16 sets out the accounting principles for the recognition, measurement, presentation and disclosure of leases. The standard introduced a single lessee accounting model, requiring most leases to be recognised on the balance sheet through a right-of-use asset and a corresponding lease liability.
IFRS 16 sets out the accounting principles for the recognition, measurement, presentation and disclosure of leases. The standard introduced a single lessee accounting model, requiring most leases to be recognised on the balance sheet through a right-of-use asset and a corresponding lease liability.
KEY IMPLICATIONS
KEY IMPLICATIONS
What IFRS 16 means in practice
What IFRS 16 means in practice
Lease inventory
Lease inventory
Lease identification and assessment
Lease identification and assessment
Measurement and ongoing reassessment
Measurement and ongoing reassessment
Systems, processes and controls
Systems, processes and controls
A complete and reliable lease inventory is the foundation of IFRS 16. Lease contracts are often decentralised across departments and may not be consistently documented or maintained.
A complete and reliable lease inventory is the foundation of IFRS 16. Lease contracts are often decentralised across departments and may not be consistently documented or maintained.
Each contract must be assessed to determine whether it contains a lease and requires careful consideration of lease terms, options and other key judgements.
Each contract must be assessed to determine whether it contains a lease and requires careful consideration of lease terms, options and other key judgements.
Lease liabilities and right-of-use assets depend on assumptions such as discount rates and lease terms and require reassessment when contracts change.
Lease liabilities and right-of-use assets depend on assumptions such as discount rates and lease terms and require reassessment when contracts change.
Robust governance, clear responsibilities and appropriate systems help ensure lease data remains accurate, complete and audit-ready over time.
Robust governance, clear responsibilities and appropriate systems help ensure lease data remains accurate, complete and audit-ready over time.
TIMELINE
TIMELINE
Exemplary lifecycle of a lease under IFRS 16
Exemplary lifecycle of a lease under IFRS 16
New/changed contract
New/changed contract
A lease agreement is entered into or changed and becomes subject to assessment under IFRS 16.
A lease agreement is entered into or changed and becomes subject to assessment under IFRS 16.
Initial assessment
Initial assessment
Determine whether the
contract contains a lease
and assess key judgements.
Determine whether the
contract contains a lease
and assess key judgements.
Initial recognition
Initial recognition
Lease is recognised through a right-of-use asset and a corresponding lease liability.
Lease is recognised through a right-of-use asset and a corresponding lease liability.
Ongoing reassessment
Ongoing reassessment
Monitor modifications,
index changes and
reassessments.
Monitor modifications,
index changes and
reassessments.
Financial reporting
Financial reporting
Reflect updated lease information in the financial statements and related disclosures.
Reflect updated lease information in the financial statements and related disclosures.
THE BARNS APPROACH
THE BARNS APPROACH
The IFRS 16 project journey
Every situation is different — but most projects follow a recognisable arc. The depth and focus of each phase depends on the specific standard, organisation and starting point.
Every situation is different — but most projects follow a recognisable arc. The depth and focus of each phase depends on the specific standard, organisation and starting point.
1
Requirements & intial impact assessment
Requirements & intial impact assessment
2
Detailed technical assessment & addressing gaps
Detailed technical assessment &
addressing gaps
3
Reporting framework design
Reporting framework design
4
Implementation & coordination
Implementation & coordination
5
Training & knowledge transfer
Training & knowledge transfer
6
Dry run & validation
Dry run & validation
7
First time reporting & audit readiness
First time reporting & audit readiness
Looking closer at the first step
Based on the readiness impact summary, you can decide whether to continue internally or move into Step 2 Detailed technical assessment phase together with BARNS.
Based on the readiness impact summary, you can decide whether to continue internally or move into Step 2 Detailed technical assessment phase together with BARNS.
The auditor's perspective – built in from the start:
Led by a licensed Wirtschaftsprüfer (German Public Auditor / CPA equivalent), BARNS understands not only how new reporting requirements are implemented, but also how they may later be challenged in an assurance context.
The auditor's perspective – built in from the start:
Led by a licensed Wirtschaftsprüfer (German Public Auditor / CPA equivalent), BARNS understands not only how new reporting requirements are implemented, but also how they may later be challenged in an assurance context.
Let's find out where you stand.
Let's find out where you stand.
Whether you're implementing IFRS 16 for the first time or enhancing an existing setup, the first step is understanding your current lease landscape. Together, we identify key challenges and define a pragmatic way forward.
Whether you're implementing IFRS 16 for the first time or enhancing an existing setup, the first step is understanding your current lease landscape. Together, we identify key challenges and define a pragmatic way forward.
Advisory for reporting, accounting and transformation.
© 2026 BARNS GmbH Wirtschaftsprüfungsgesellschaft. All rights reserved.
Advisory for reporting, accounting and transformation.
© 2026 BARNS GmbH Wirtschaftsprüfungsgesellschaft. All rights reserved.
Advisory for reporting, accounting and transformation.
© 2026 BARNS GmbH Wirtschaftsprüfungsgesellschaft. All rights reserved.
Advisory for reporting, accounting and transformation.
© 2026 BARNS GmbH Wirtschaftsprüfungsgesellschaft. All rights reserved.