Operating Lease

A lease that under IFRS 16 and ASC 842 now sits on the balance sheet as a right-of-use asset and a lease liability. Whether to treat that liability as debt in the EV bridge is a live judgement: it is a contractual fixed obligation, but treating it as debt while leaving lease costs inside EBITDA double-counts. Pick one treatment, apply it to every company in the comp set, and say which you chose.

Go deeper

This term comes up constantly in accounting interviews and on the desk.

IB technical questions guide

Related Accounting terms

Go further than reading

The written material is free. These are the ways to get it applied to your own work.

Browse the full glossary — 150+ finance recruiting and technical terms, in plain English.