Hello Salome,

The only other exception to what William wrote is when the repair and maintenance performed by the lessee company would result in reduction of future lease rentals. In that situation the repair and maintenance will satisfy the definition of an asset so can be capitalized.

Definition of an Asset

“The future economic benefit embodied in an asset is the potential to contribute, directly or indirectly, to the flow of cash and cash equivalents to the entity. The potential may be a productive one that is part of the operating activities of the entity. It may also take the form of convertibility into cash or cash equivalents or a capability to reduce cash outflows, such as when an alternative manufacturing process lowers the costs of production.”

Benaya