CERTYNEX IFRS ACADEMY

At the commencement date, Mirandol used a lease term of 5 years for the lease of a workshop, its 2-year extension option not being reasonably certain. At the end of the fifth year, Mirandol notifies the lessor that it exercises that option, as provided by the contract. How is the lease term treated?

The lease term remains 5 years: it was set at the commencement date.

The 2 additional years form a separate contract unrelated to the original lease term.

The lease term is revised only if market rents have risen since the commencement date.

The lease term is revised, since exercising an option not previously included changes the non-cancellable period.