The process, or the result, of determining whether a lease is a capital/finance lease or an operating lease. Normally, classification is done automatically by EZLease, based on the 7(a)-7(d) tests listed in Capital lease above.
ASC 842, IFRS 16, and GASB 87 introduce the additional classification of short term; IFRS 16 also introduces the low value classification but removes the operating classification for Lessees.
Related links:
Classification of a LESSEE lease | Classification of a LESSOR lease | Classification summary report