Gledia KOKOSHI & Ardi SUKAJ
IFRS 16: Leases has been published by the International Accounting Standards Board and it comes into effect on 1 January 2019. The main changes in the accounting treatment between the existing accounting treatments and the new standard will be discussed in the first part of the paper.
Any company which uses rentals or leasing as a mean to obtain access to assets will be affected by the new standard. The IFRS 16 requirements significantly reduces all off balance sheet accounting for leases and impacts the financial metrics. This paper will provide information on the impacts that the adaptation of the new standard will have on the financial ratios. A brief analyze on the industries which are expected to be impacted mostly from the new standard will be presented in the third part of the paper.
Understanding the impact that the new standard may help companies reduce compliance risk and implementation costs.