11/02/2021 - EFRAG Draft Comment Letter on IFRS 16 and Covid-19- Comments requested by 22 February 2021

​On 11 February 2021, the IASB issued Exposure Draft ED/2021/2 Covid-19-Related Rent Concessions Beyond 30 June 2021 (Proposed Amendments to IFRS 16) ('the ED').

The proposed amendment would extend the scope of the 2020 amendment by increasing the period of eligibility to apply the practical expedient from 30 June 2021 to 30 June 2022.

EFRAG supports the proposal to extend the scope of the Amendments by increasing the eligibility period for the application of these Amendments by 12 months from 30 June 2021 to 30 June 2022. EFRAG acknowledges the uncertainty associated with the length and severity of the ongoing pandemic and the consequential adverse impacts on the economic environment that have arisen and resulted in an extended period of Covid-19-related rent concessions.

EFRAG agrees that there remains a need to provide relief for lessees given the ongoing challenges that lessees face in assessing whether lease modifications have occurred under the circumstances of covid-19. EFRAG supports a continued time restriction to ensure only the Amendments only apply to covid-19-related concessions and to limit the effect of reduced comparability due to the Amendments.

EFRAG supports the proposed transition requirements including that it should be applied on a modified retrospective basis, and that early adoption be allowed at the date of the IASB’s issuance of the extension of the amendment.

The Draft Comment Letter can be found here​​.