Where an entity transfers an asset and leases it back, both parties account for the transfer and the lease together. Whether the transfer is a sale is decided by the AASB 15 test for a satisfied performance obligation. If it is a sale, the seller-lessee measures the leaseback right-of-use asset at the proportion of the asset's previous carrying amount attributable to the retained right of use, so that only the gain or loss on the rights passed to the buyer-lessor is recognised, and the buyer-lessor accounts for the purchase under the applicable Standards and the lease as lessor. Below-market terms are treated as prepaid lease payments and above-market terms as additional financing, measured by the more readily determinable of the fair value gap on the consideration and the present value gap on the lease payments against market rates. Afterwards the seller-lessee applies the lessee measurement rules in a way that does not recognise the gain relating to the retained right of use, other than a termination gain or loss on a scope reduction. If the transfer is not a sale, the seller-lessee keeps the asset and recognises a financial liability for the proceeds under AASB 9, and the buyer-lessor recognises a financial asset.
The graph holds this control, the 0 it maps to, and the evidence behind each claim, over MCP and REST.