If a lease is revised, the change may reflect a change in the underlying asset. For instance, the square feet leased in a building may change (becoming larger or smaller).
If the scope increases, and the increased rent is commensurate with the standalone price for the additional right of use, the increase is treated as a new agreement. [842-10-25-8]
If the scope increases, and the increased rent is not commensurate with the standalone price, the lease must be broken into two components reflecting the original asset and the new asset, with the rent allocated proportionally to each. [842-10-25-11, 842-10-55-168]
If the scope decreases, the asset is reduced proportionately, and a gain or loss recognized for the difference between the change in asset and change in liability. [842-10-25-13, 842-10-55-177] You can enter a percentage by which the asset is reduced in the Reduced Asset Percentage (optional according to 842-10-55-183, required for IFRS 16). Otherwise, EZLease calculates the percentage to reduce the right-of-use asset based on the percentage change in lease liability, as described in 842-10-55-181.
For IFRS and GASB, there is another option: Not Scope Reduction. Normally, a reduction in the lease term is treated as a reduction in scope, resulting in a partial termination with gain or loss reporting. If you choose Not Scope Reduction, no gain or loss is recognized; the asset and liability are reduced by the same amount. This is intended for minor adjustments in the lease term, usually of 30 days or less. This is not offered for US GAAP, because a reduction in term is not treated as a reduction in scope to begin with.