CERTYNEX IFRS ACADEMY

Cowelia, which operates a coworking space, leases 40 laptops for three years; each laptop, when new, would meet the criteria of a low-value asset. Cowelia plans to sublease these laptops to the members of its space. It wishes to apply the low-value exemption to the head lease. Which analysis should be adopted?

The exemption applies, since each laptop is of low value when new.

The exemption applies provided that the sublease income is not material.

The exemption applies, because the low-value election may be made lease by lease.

The exemption is ruled out: a head lease cannot relate to a low-value asset when the lessee subleases the asset or expects to sublease it.