CERTYNEX IFRS ACADEMY

The Ardelle firm leases an office floor. Halfway through, it leases an additional floor in the same building for the remaining term, with an additional payment 30% below the price charged for comparable space; no circumstance specific to the contract justifies this discount, granted to retain a major tenant. What is the appropriate treatment at the effective date of the modification?

Recognise a separate lease for the added floor, since a new underlying asset is leased.

Recognise nothing before the reporting date, since the modification only affects future payments.

Remeasure the lease liability using a revised rate and recognise the difference in profit or loss for the period.

Remeasure the liability on the consideration of the modified lease at a revised rate and adjust the right-of-use asset by the same amount.