On March 27, 2023, FASB issued the eagerly awaited Accounting Standards Update (ASU) 2023-01, Common Control Arrangements, that addresses two issues:
- Terms and conditions to be considered for arrangements between entities under common control in determining whether a lease exists, and if so, the classification and accounting for that lease
- The accounting for leasehold improvements under Accounting Standards Codification 842 when the lease term in a common control lease is shorter than the useful life of the leasehold improvements
This article provides details on the ASU.
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