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      Question

      A lessee signs a 6-month lease of office space with no

      renewal option. Should it apply Ind AS 116 lease accounting?
      A Yes, all leases require recognition. Correct Answer Incorrect Answer
      B No, exemption applies for leases ≤12 months. Correct Answer Incorrect Answer
      C Only if value of lease payments > ₹50 lakh. Correct Answer Incorrect Answer
      D Yes, unless landlord agrees otherwise. Correct Answer Incorrect Answer
      E Only if lease is cancellable. Correct Answer Incorrect Answer

      Solution

      Short-term leases (≤12 months) can use exemption → expense as incurred instead of recognising RoU asset and liability.

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