Incremental Borrowing Rate Calculator
The Incremental Borrowing Rate (IBR) is the rate of interest that a lessee would have to pay to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment.
Information required for the calculation
- Nature of lease
- Country for which IBR is applicable
- IBR calculation date
- Earnings before interest and taxes (EBIT)
- Interest expense
- Lease term (years)
Benefits
- Fast turnaround time that is within 2 business days
- Does not require complex inputs, it is dependent on readily available accounting information
- Detailed report that can be used for audit purposes
- Applicable to any form of lease