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Navigating PSAK 73 & 116: Why Lease Compliance Remains a Challenge in 2025

It has been more than five years since PSAK 73 on leases was implemented in Indonesia, on January 1st 2020, that had enormous impacts on the way companies account for leases. Compliance became more complex for companies since the implementation of PSAK 116 since January 1st 2024 that concerns lease liabilities in sale and leaseback transactions. It regulates the subsequent measurement of such transactions.


Under PSAK 73, lessees are no longer required to distinguish between finance-lease contracts (on balance sheet) and operating-lease contracts (off balance sheet), but instead they must recognize a right-of-use asset and its corresponding lease liability for almost all lease contracts. There are exceptions to short-term leases, which are the leases that are less than 12 months and if the lessees do not have option to buy. An exception also applies to low-value leases, according to international practices, applies to assets valued at or below US$5,000, such as laptops, phones, and furniture.


The amendments of PSAK 73, now covered under PSAK 116, issued in November 2022, aim to address the gap on the approach on how a seller-lessee should measure the right-of-use asset arising from the leaseback. It specifies that, in measuring the lease liabilities, the seller-lessees have to determine ‘lease payments’ and ‘revised lease payments’ in a way that ensures the seller-lessees do not recognize any amount of the gain or loss related to the portion of the right-of-use asset they retain.


These accounting standards have broad repercussions on how companies in Indonesia account for leases. The standards impact wide range of companies operating in various industries, such as aviation, retail, travel, transportation, telecommunication, food & beverages. Despite the time elapsed since the standards were implemented, substantial practical challenges still persist. Here are some of the most common issues we continue to see in 2025:

·  Identification and classification between lease and non-lease components under PSAK 73 can be tricky.

·  Errors often occur during the calculation and remeasurement of right-of-use (ROU) asset and lease liability, particularly after a lease modification or renewal.

·  Difficulties in creation of recurring journals and amortization schedules. Many companies, particularly in Indonesia, still use spreadsheets, which increases the risk of manual error and time consumption.

·  Inconsistent records or non-compliant journals can lead to finding in the audit processes.

· Many unique terms and covenants in lease agreements—such as capitalized costs, residual values, and contingent payments—can add complexity to the creation of lease-related journal entries.


In the era of increasing competition and stricter compliance monitoring, lessee companies should move fast and consider possible changes to IT systems. The new system must be capable to help companies dealing with the new requirements instead of using spreadsheets to manage their leases. It also must be able to revamp the internal controls to ensure completeness and accuracy in the processes of lease accounting standards. The accounting software, LEASEE is the accounting software solution that should be considered. Its innovative features can help lessees save time and costs, while improving the accuracy of lease accounting based on PSAK 116 and IFRS 16, and improves productivity. The software offers several key advantages:

·  Automation.

LEASEE offers full automation to manage Lease Schedule, Accounting Journal, Summary Report, and Aging Report. It helps lessees save time and reduce risks in the exhausting and complex accounting processes.

· Range of features. 

LEASEE has wide range of features that can handle various lease scenarios, among them are capitalized costs, contingency costs, residual value, bargain of purchase option, and lease incentives.

· Adaptive.

LEASEE is a versatile tool that can provide the needs of every lessee. It can easily perform Change in Contract, Early & Ending Termination, Stepping Rate, and the adjustments of other parameters based on the covenants.

· Compatibility.

LEASEE can be integrated to various accounting systems and ERP. Lessees can smoothly export journals from LEASEE into their accounting systems and ERP. LEASEE is also capable of processing and exporting lease contracts into diverse file formats.


For more information, visit leasee.id and for a consultation, contact our expert:




Best Regards,

LEASEE Consultant

PT Sazanka Henig Solusi


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