What are the lessee exemptions under IFRS 16?

Under IFRS 16, a lessee has specific exemptions that allow for a simplified accounting treatment for certain types of leases. The correct answer relates to short-term leases and leases of low-value underlying assets.

Short-term leases are those that have a lease term of 12 months or less and do not contain a purchase option. For these leases, the lessee can elect not to recognize the right-of-use asset and lease liability on the balance sheet. Instead, the lease payments are accounted for on a straight-line basis or another systematic basis over the lease term, which simplifies the accounting process.

Additionally, IFRS 16 allows lessees to exclude leases for low-value assets from the recognition requirements. Low-value assets are typically those that are not significant in monetary terms, such as office furniture or small equipment. The threshold for "low-value" is not explicitly defined in the standard, but it is intended to provide relief for leases that would not materially impact the financial statements.

While the other options mention different criteria for exemption, they do not align with the provisions set out in IFRS 16. Therefore, the correct understanding of lessee exemptions centers on short-term leases and leases involving low-value underlying assets, as outlined in the standard.