Right-of-use asset
The accounting record representing the organisation’s right to use the underlying asset during the lease term.
The operating question
What is the business problem lease accounting addresses?
If significant lease commitments sit only in contracts, inboxes and payment files, financial statements and operating teams may not share a complete view of what the organisation controls and owes.
What right does the organisation control?
What payments is it committed to make?
When did the right to use the asset become available?
What changed after the original agreement was signed?
Connected workflow
The logic in plain English
- 01
Identify
Determine whether an arrangement contains a lease under the applicable policy.
- 02
Measure
Use approved terms, payments and discount-rate inputs to establish the required records.
- 03
Recognise
Record the right-of-use asset and lease liability where the standard requires them.
- 04
Update
Process payments, interest, depreciation and approved lifecycle events.
- 05
Explain
Retain schedules, judgements, reconciliations and evidence for reporting and review.
Connected records
Five concepts worth understanding
Lease liability
The accounting record for the present value of future lease payments included under the applicable policy.
Discount rate
The approved rate used to convert future payments into a present value.
Commencement
The point when the asset is available for use, assessed from contract terms and operational evidence.
Subsequent measurement
The periodic update of liability, interest, payments, ROU depreciation and other required records.
Remeasurement
A controlled recalculation triggered by qualifying changes such as terms, scope or payment assumptions.
Illustrative example
An equipment lease over several years
The organisation receives the right to use equipment now and agrees to make future payments. The accounting records represent both sides. The asset register and field evidence show which equipment is actually in use.
This is a conceptual illustration, not an accounting calculation or policy conclusion.
Right obtainedUse of equipment
ObligationFuture lease payments
Operating proofReceipt, asset, location
Ongoing eventsPayments and changes
Business value
What the organisation gains
Visibility
Give decision-makers a clearer view of lease commitments and the assets supporting operations.
Consistency
Apply approved policies and source-data requirements across entities, lessors and asset classes.
Traceability
Explain how a reported balance relates to terms, payments, approvals and physical assets.
Scope and responsibility
What the platform supports—and what people decide
ServiceTiket maintains configured records, schedules, approvals and evidence. The organisation and its advisers remain responsible for accounting policy, treatment, review and compliance.
Ind AS 116 is the primary accounting context for the India offering. IFRS 16 or ASC 842 requirements are assessed separately where group reporting requires them.
Calculations, reports, integrations and controls are confirmed during discovery and testing before they are included in an implementation scope.
Continue exploring LeaseOps
A useful first conversation
Map one real asset from contract to field reality
Bring an anonymised lease schedule, asset register, or workflow. We will map where the records separate and what a controlled process could look like.
Review your lease data