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FRS 102: Leases under UK GAAP

FRS 102 Section 20 Leases sets out the requirements for the classification, recognition and measurement of operating and finance leases. It includes the accounting and disclosure requirements for both lessees and lessors.

The standard

The requirements regarding leases are set out as part of FRS 102. However, individual sections of the standard should not be looked at in isolation as other parts may be relevant.

FRS 102 is regularly updated and amended by the Financial Reporting Council (FRC). For the full text of FRS 102, guidance on which version of the standard to apply and notes on recent amendments, see our main FRS 102 page.

ICAEW guides and support

Helpsheets and factsheets

COVID-19-related rent concession under FRS 102 and FRS 105

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Technical helpsheet issued to help ICAEW members preparing financial statements under FRS 102 and FRS 105 to account for operating leases for which covid-19-related rent concessions have been granted.

IFRS 16 Leases FAQs


Financial Reporting Faculty outlines some of the key requirements of IFRS 16 Leases for lessees and lessors. Key differences when reporting leases under FRS 102 are also described.

How does a lessee account for a rent free period under FRS 102?

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Technical helpsheet to help members understand how lessees should account for an operating lease with a rent free period under FRS 102 and provides a practical example of the calculations required.

Leases under FRS 102

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Technical helpsheet to help ICAEW members understand key aspects of accounting for leases under FRS 102.

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A detailed, practical chapter on financial reporting of leases under FRS 102, containing many examples. Includes sections on classification, lessee accounting - finance and operating leases, lessor accounting - finance and operating leases, manufacturers and dealers and disclosure requirements.

Sale and leaseback transactions

A detailed, practical chapter on financial reporting of of sale and leaseback transactions under section 20 of FRS 102 and section 15 of FRS 105 on leases, with worked examples. These transactions have become increasingly common as a means of sourcing finance. The chapter includes sections on sale and leaseback as a finance and as an operating lease.


A chapter on leases - part of a one-stop-shop guide by Steve Collings on all aspects of UK auditing standards and new UK GAAP accounting standards. The chapter shows how to put the standards into practice, covering accounting disclosure requirements for finance and operating leases (for both lessees and lessors) as well as auditing leasing transactions.

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Fully updated guide focusing on each area of the financial statement in detail with illustrative examples. This chapter gives a comparison of FRS 102 Section 20 and IFRS 16 and explains lease classification, accounting for finance leases, accounting for operating leases, modifications to leases, sale and leaseback transactions, and disclosures.


A practical manual for preparing new UK GAAP-compliant disclosures. This chapter discusses the classification of leases and presents sample disclosures for finance lease lessors and lessees, disclosures for operating lease lessors and lessees, and requirements for sale and leaseback transactions. It also discusses disclosure requirements for IAS 17 and IFRS 16.

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Example accounts

Model accounts and disclosure checklists for UK GAAP
The ICAEW Library can provide model accounts and disclosure checklists for FRS 101, FRS 102, FRS 102 Section 1A, FRS 103 and FRS 105. The examples and checklists cover a broad range of entities, including small companies, charities, groups, LLPs and micro-companies.

Further reading

Manuals and handbooks

The ICAEW Library stocks the latest UK GAAP handbooks and manuals. You can browse all our books on FRS 102 and leases or request any of the following popular titles by contacting us on +44 (0)20 7920 8620, by web chat, or at library@icaew.com

GAAP 2019: UK reporting – FRS 102 (Volume B)
Deloitte, Croner-i, 2019
Comprehensive manual explaining how to apply FRS 102, with worked examples and extensive interpretation and guidance. The chapter on leases covers the classification of leases, financial statements of lessees and lessors for finance leases and operating leases, and sale and leaseback transactions with reference to SSAP 21, IAS 17 and IFRS 16.

Manual of accounting: UK GAAP
PwC, Lexis Nexis, 2019
Practical guide with worked examples throughout, dealing with day-to-day issues as well as complex questions. The chapter on leases explains the classification of leases, accounting by lessees, and accounting by lessors. 

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