Economic Consequences of the New Lease Accounting Standard: Evidence from Japan

2012 ◽  
Author(s):  
Masaki Kusano ◽  
Yoshihiro Sakuma ◽  
Noriyuki Tsunogaya
Keyword(s):  
Economic Consequences ◽  
Accounting Standard ◽  
Lease Accounting

Leases that are not leases: qualification and accounting

2021 ◽  
pp. 15-25
Author(s):  
L.V. Sotnikova
Keyword(s):  
Russian Federation ◽  
Healthcare Organizations ◽  
Accounting Standard ◽  
The Russian Federation ◽  
Ministry Of Finance ◽  
Lease Accounting

On the eve of the entry into force for the mandatory application of all enterprises and organizations of the Russian Federation of the Federal Accounting Standard 25/2018 “Lease Accounting”, approved. By order of the Ministry of Finance of Russia dated October 16, 2018 No. 208n, from January 1, 2022, many heads of economic structures, including healthcare organizations, and their accountants, who act as tenants in lease agreements, are concerned about avoiding the complicated accounting of leased objects which is prescribed by this standard. Accounting methodologists, consultants, experts, and others try to use literally every clause, subclause, paragraph, every word and every comma in order to justify that their lease relationship is not covered by this accounting standard.

Instructional Case: Worldwide Shipping Corporation Ltd: Early or Late Adoption of a New International Accounting Standard?

1999 ◽  
Vol 14 (2) ◽  
pp. 211-231
Author(s):  
Peter Lee ◽  
Pearl Tan
Keyword(s):  
Financial Reporting ◽  
Financial Analysis ◽  
Balance Sheet ◽  
Financial Statements ◽  
Economic Consequences ◽  
International Accounting ◽  
Accounting Choice ◽  
Accounting Standard ◽  
The Impact ◽  
International Accounting Standard

The management of Worldwide Shipping Corporation Ltd (hereafter “Worldwide Shipping”) is confronted with a dilemma when a new international accounting standard on leases is introduced which contains a transitional provision allowing firms to defer implementation for a period of four years. Students are required to put themselves in the position of managers who have to weigh the adverse impact of early adoption of the new accounting standard against a responsibility for fair financial reporting. Worldwide Shipping is a multifaceted case that can be used as an accounting case study or a financial analysis study. The objectives of the case are threefold. First, it aims to provide students with a better understanding of the impact of off-balance sheet transactions (in this case, sale-leaseback contracts) on a firm's financial statements. Second, it requires students to examine implications of accounting choice on management compensation and debt-contracting costs, as well as the perplexing problem of recognition in financial statements vs. footnote disclosures. By putting students in the position of managers, the case increases students' awareness of the possible economic consequences arising from accounting choice. Third, it provides students with a useful exercise in the mechanics of effecting a change in accounting method using the retroactive method.

Tourist Trap: The new lease accounting standard and debt covenants

2018 ◽  
Vol 45 ◽  
pp. 45-59 ◽  
Author(s):  
Charlene Spiceland ◽  
David Spiceland ◽  
Phillip Kamau Njoroge
Keyword(s):  
Debt Covenants ◽  
Accounting Standard ◽  
Lease Accounting

scholarly journals Did the goodwill accounting standard impose material economic consequences on Australian acquirers?

2008 ◽  
Vol 0 (0) ◽  
pp. 080318002557372-??? ◽  
Author(s):  
Kieran James ◽  
Janice How ◽  
Peter Verhoeven
Keyword(s):  
Economic Consequences ◽  
Accounting Standard

scholarly journals Economic impacts of capitalization of operating leases: Evidence from Japan

2015 ◽  
Vol 12 (4) ◽  
pp. 828-850 ◽  
Author(s):  
Masaki Kusano ◽  
Yoshihiro Sakuma ◽  
Noriyuki Tsunogaya
Keyword(s):  
Economic Impacts ◽  
Economic Consequences ◽  
Financial Ratios ◽  
Accounting Standard ◽  
Coverage Ratio ◽  
Rule Change ◽  
Operating Leases ◽  
Accounting Numbers ◽  
Equity Ratio ◽  
Pro Forma

The purpose of this study is to investigate the economic impacts of capitalization of operating leases in Japan. Specifically, this study estimates the ex-ante impacts of capitalization of operating leases by comparing pro-forma accounting numbers based on a proposed rule change with reported accounting numbers under an extant rule. Our findings are twofold. First, capitalization of operating leases has significant impacts on financial ratios, including the debt to equity ratio (DER) and the interest coverage ratio (ICR). Second, the impacts of capitalization of operating leases on these financial ratios are more likely to be large after the adoption of Statement No. 13, Accounting Standard for Lease Transactions. This study contributes to the literature on economic consequences of capitalizing leases and discussions of global convergence of accounting standards.

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