Why is there no principal amount in the first few years on my GASB Amortization Schedule?
The initial years of a GASB amortization schedule show no principal amount because, according to GASB 87 paragraph 24, lease payments are applied to interest first before reducing the principal, especially in long-term leases with significant interest.
When there is a relatively long lease, there will be a significant amount of interest to recognize. Per GASB 87 paragraph 24, payments are applied to interest first, then principal. This holds true for the maturity analysis calculations as well as the recognition of the interest portion through the life of the lease.