By Kathy Spearing | April 21, 2020


In light of the COVID-19 pandemic, FASB proposed a one-year extension to the effective date of the new lease accounting standards for private companies and most nonprofits. The purpose of the proposed change is to offer relief to financial statement preparers who are otherwise focused on the global pandemic.

The lease accounting standard is scheduled to take effect for private companies and private nonprofits for fiscal years beginning after Dec. 15, 2020, and interim periods within fiscal years beginning after Dec. 15, 2021. The proposed extension gives these entities the option to apply the new lease accounting standard for fiscal years beginning after Dec. 15, 2021, and to interim periods within fiscal years beginning after Dec. 15, 2022.

The FASB also proposed deferrals for “public” nonprofits lease accounting effective dates and private company franchisors reporting periods for the new revenue recognition standards.

Since many of the entities are universities and hospitals, the deferral is surely a measure of good faith. FASB could consider additional delays beyond 2021 and 2022 as a result of COVID-19, as well.

To learn more, read this Journal of Accountancy article.


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