Are capitalized leases an intangible asset?

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Blackburn 0 Comments

Let’s say that a company has some finance leases which are capitalized as they standards suggest. Are the capitalized leases considered intangible assets?

1 Answer

score 0 · Answer 1 · 2012-12-02T19:15:53+00:00

Finance Leases are recognized as normal assets. The substance over form guidance says that even when the legal form is that the company does not own the asset, the economic reality is that it does.

A Finance lease usually refers to tangible assets (buildings, machinery etc) so they are usually not intangible assets. On the other hand, if a company sells and leases back a patent or the right to produce using a patent, then yes it can be an intangible asset.