ROU
Business & Finance abbreviation · Accounting
| Stands for | Right-of-use asset |
|---|---|
| Categories | Business & Finance |
ROU stands for Right-of-use asset, an accounting abbreviation.
Asset a lessee records on its balance sheet representing its right to use a leased item, such as an office, store, aircraft or vehicle, over the lease term. It is recognized together with a matching lease liability.
Example: Signing the ten-year headquarters lease added a $48 million ROU asset and lease liability.
Usage notes
ROU accounting arrived with IFRS 16 and ASC 842, both effective in 2019 for large companies, bringing most operating leases onto balance sheets. Under IFRS the ROU asset is depreciated separately from lease interest, while US GAAP keeps a single straight-line lease cost for operating leases.
Related abbreviations
More accounting abbreviations
- Q2 – Second quarter
- Q3 – Third quarter
- Q4 – Fourth quarter
- QoQ – Quarter over quarter
- QTD – Quarter to date
- RE – Retained earnings
- SFAS – Statement of Financial Accounting Standards
- SG&A – Selling, general and administrative expenses
- SOX – Sarbanes-Oxley Act
- T&E – Travel and expenses
- TB – Trial balance
- VIE – Variable interest entity