E&M

2020/3

Marco Gesualdi Annalisa Prencipe

A New Era of Lease Accounting

The new accounting standard IFRS 16 significantly modifies the recording of leases in financial statements, eliminating the distance between operating and finance leases, and requiring the recognition of right-of-use assets in the balance sheet, with the simultaneous recording among liabilities of the current value of the payment commitments assumed.#The shift to IFRS 16 has translated into a significant increase of total assets and total liabilities, with a worsening of net financial position and the rate of financial debt. Moreover, it will improve transparency on companies' debt exposure, at the same time improving the comparability between the financial statements of different companies.

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