Understanding Calculations
How FRS 102 lease liability, ROU asset, discount rate, and amortization schedules are calculated. Worked examples with OBR, IBR, and SONIA rates.
Lease Liability (Present Value)
FRS 102 lease liability is the present value of future lease payments discounted at the OBR, IBR, or implicit rate. Learn Day 1 measurement per FRS 102.20.50.
ROU Asset
The ROU asset equals lease liability plus initial direct costs and restoration costs, less incentives. FRS 102 Day 1 and subsequent measurement.
FRS 102 Discount Rate: OBR, IBR, Implicit
Which FRS 102 discount rate to use: obtainable borrowing rate (OBR) for SMEs, IBR, or rate implicit in the lease. Worked examples plus live SONIA.
Amortization Schedule
The FRS 102 amortization schedule shows period-by-period interest expense, principal reduction, ROU asset depreciation, and closing lease liability balance.
Calculation Methodology
Learn how Lease102 implements FRS 102 Section 20: day count conventions, payment timing (advance or arrears), compounding frequency, and period-rate derivation.
FRS 102 Lease Example: 5-Year Office Lease
Step-by-step FRS 102 Section 20 worked example: discount rate, lease liability, ROU asset, Day 1 journal, 12-month schedule on a UK office lease.