BC273 The IASB decided that an entity is not required to reassess whether contracts are, or contain, leases on transition to IFRS 16. Consequently, an entity can choose to apply the requirements of IFRS 16 to all existing contracts that met the definition of a lease applying the requirements of IAS 17 and IFRIC 4. Similarly, an entity does not need to apply IFRS 16 to existing contracts that did not meet the definition of a lease applying the requirements of IAS 17 and IFRIC 4.
BC274 Preparers provided feedback that it could be costly for them to reassess all of their existing contracts using the definition of a lease requirements in IFRS 16. The IASB observed that it envisages only a limited number of scenarios in which application of the lease definition requirements in IFRIC 4 would result in a different outcome from the application of the lease definition guidance in IFRS 16. The IASB identified a small population of contracts that would be classified as leases
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