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transition lease

A transition lease is one with a Start Date before the Effective Date (typically, 2019-01-01 for a public company) but with an End Date after that Effective Date.

The FASB guidance directs lease managers to account for:

• the lease periods before the Effective Date under ASC 840

• the lease periods after the Effective Date under ASC 842

FASB guidelines also call for making certain provisions for transition accounting.