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Journal article
Effects of lease capitalization techniques on key measures of financial performance
Accounting and finance : journal of the Accounting Association of Australia and New Zealand, Vol.12
02/2013
Abstract
This paper examines the effects of selected lease capitalization techniques for five representative companies from five different industries. Changes to financial statement elements (assets, liabilities, equity, and net income) and key performance measures (total debt to assets ratio (D/A), total debt-to-equity ratio (D/E), long term debt-to-equity ratio (LTD/E), return on assets (ROA), and return on equity (ROE)) are compared and contrasted both among companies and by capitalization technique. The retail (pharmaceutical) firm in the sample is the most (least) affected by lease capitalization. In addition, the complexity and/or specificity of the lease capitalization model does not result in greater consensus among the methods. This research informs the continuing harmonization efforts related to lease accounting being undertaken by the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB).
Details
- Title
- Effects of lease capitalization techniques on key measures of financial performance
- Publication Details
- Accounting and finance : journal of the Accounting Association of Australia and New Zealand, Vol.12
- Resource Type
- Journal article
- Publisher
- Academic and Business Research Institute
- Format
- link
- Number of pages
- 12
- Copyright
- © AFAANZ
- Identifiers
- 99380473594906600
- Academic Unit
- Accounting and Finance; Lewis Bear Jr. College of Business
- Language
- English