[lucas_membrane]

> the timing of the expense is different as it front loads the expense (because of the interest accretion)

I would expect that if a firm could make a good case to its auditors that the revenue derived from the use of the leased asset was expected to be higher during the early years or lower during the later years, or vice versa, then the auditors would allow a timing adjustment somewhere.

If my corporation has just signed a 12-year operating lease for some property in Los Angeles with the intention of profitably obtaining revenue from the property only during the 2028 Olympics, do these accounting rules lock me into such unrealistic reporting?

Many years back, I spent quite a bit of time on similar but different issues of recognition of revenue and expense, and it seemed that if one could make a good case, there was flexibility, but everyone wanted to abuse it. Is the flexibility still available in reasonable cases, gone now in general, or gone only for specific classes of contracts like operating leases?