- Companies’ may appear to be more asset-rich, but with a larger debt burden. The more lease agreements your company has, the bigger the impact on your accounts.
- If you manage a large leasing portfolio, IFRS 16 will affect and change your accounting and financial ratios. Unfortunately, this may lead to your company appearing less attractive to potential investors.
- If your company has banking agreements in place, this new standard could also cause problems if you are obliged to maintain a certain level of profitability for banking agreements to continue.
- Need to identify all leases as assets, while your obligations to make payments towards lease agreements will be stated as liabilities in your balance sheets.
- Need to gather information on all your lease agreements – including the terms, fees payable, end-of-term options, etc., so that you can show which payments need to adhere to IFRS 16 and which are separate.
MMS Group offers to assist with your company’s IFRS needs, including IFRS 16, to ensure that you are compliant with IFRS accounting and reporting requirements. For assistance, contact us directly via phone or email, or visit our website.
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