[Verse 1] When companies lease assets for their needs From buildings, cars to office space Old rules let many stay off balance sheets But now we track in every case The lessee gets the right to use Creates an asset on their books Plus liability they can't refuse Let's learn these accounting hooks [Chorus] Right-of-Use asset on the left side Lease liability on the right Both appear when lease starts up Recording future payment sight R-O-U asset depreciates down Liability gets paid each round Balance sheet tells the full story now Transparency is what we've found [Verse 2] Finance leases and operating too Both create the ROU asset Calculate with present value Lease payments can't forget Initial direct costs get added in Prepaid rent goes in the mix Minus any incentives given That's how the math gets fixed [Chorus] Right-of-Use asset on the left side Lease liability on the right Both appear when lease starts up Recording future payment sight R-O-U asset depreciates down Liability gets paid each round Balance sheet tells the full story now Transparency is what we've found [Bridge] Over time the asset shrinks Straight line or usage based Liability balance drops as well When payments are in place Interest expense on liability Depreciation on the right-of-use Income statement shows both clearly Following the accounting rules [Verse 3] Short term leases twelve months or less Low value items get exempt But most leases now show on balance sheet No more keeping off attempt Analysts can see true leverage Hidden debt is now revealed Better comparisons between firms Corporate reality unsealed [Chorus] Right-of-Use asset on the left side Lease liability on the right Both appear when lease starts up Recording future payment sight R-O-U asset depreciates down Liability gets paid each round Balance sheet tells the full story now Transparency is what we've found [Outro] New lease standards changed the game ROU assets tell the tale Liabilities show what's owed Financial truth will never fail
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