Scope Exclusions

ASC 842-10-15-1

An entity shall apply this Topic to all leases, including subleases. Because a lease is defined as a contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration, this Topic does not apply to any of the following: 

a. Leases of intangible assets (see Topic 350, Intangibles – Goodwill and Other).

b. Leases to explore for or use minerals, oil, natural gas, and similar nonregenerative resources (see Topics 930, Extractive Activities – Mining, and 932, Extractive Activities – Oil and Gas).

c. Leases of biological assets, including timber (see Topic 905, Agriculture).

d. Leases of inventory (see Topic 330, Inventory). 

e. Leases of assets under construction (see Topic 360, Property, Plant, and Equipment).