Bringing leased assets onto the balance sheet

Cornaggia, Kimberly J.; Franzen, Laurel; Simin, Timothy T.

doi:10.1016/j.jcorpfin.2013.06.007

Cited by 71 publications

(39 citation statements)

References 54 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…; Cornaggia et al. ). Specifically, it is argued that the impact should be larger for those firms with more financial constraints, as they use operating leases more frequently (Eisfeldt and Rampini ).…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

“…Hence, it is widely evidenced that firms used all types of leases before IAS 17 and SFAS 13 were in force, while afterwards preferred to use operating leases due to their advantageous accounting treatment (Imhoff and Thomas ; Cornaggia et al. ; Grönlund et al. ) .…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

“…), some conclude that the capitalisation of operating leases would improve economic decisions (Cornaggia et al. ; Cotten et al. ).…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

“…In the US, the mean ratio of Capital leases/Total debt was 0.118 in 1980, declining to 0.059 by 2007, while the average Operating leases/Total debt was 0.84 in 1980, rising to 7.116 by 2007 (Cornaggia et al. : 349).…”

mentioning

confidence: 99%

See 3 more Smart Citations

The Value Relevance of Operating Lease Liabilities: Economic Effects of IFRS 16

Inchausti

Pardo

2018

Australian Accounting Review

View full text Add to dashboard Cite

The new IASB and FASB models for leases aim to improve the quality of financial reporting. To this end, both standard setters impose the recognition of assets and liabilities for operating leases. Meanwhile, preparers have been strongly lobbying against these changes, as in their view the new treatment will lead to negative economic consequences. We undertake a value-relevance study to examine whether as-if capitalised operating leases are priced by market users in a relatively unexplored setting. We consider Spanish listed firms, and employ handcollected data on operating leases disclosed in the notes to the financial statements to constructively capitalise the assets and liabilities. Our analysis suggests that investors in code-law countries with less developed markets and low enforcement quality do not behave any differently to those in common-law countries that have more developed markets and stricter enforcement policies. Investors equally value recognised debts and operating lease liabilities resulting from information in the notes in retail sectors. In our view, these results could provide some comfort to managers in the most affected industries, as they suggest the change will not have a major impact on the stock exchange.

show abstract

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

“…), some conclude that the capitalisation of operating leases would improve economic decisions (Cornaggia et al. ; Cotten et al. ).…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

mentioning

confidence: 99%

See 2 more Smart Citations

The Value Relevance of Operating Lease Liabilities: Economic Effects of IFRS 16

Inchausti

Pardo

2018

Australian Accounting Review

View full text Add to dashboard Cite

show abstract

“…Além de investidores em potencial poderem ser enganados, manipulação dos requisitos regulamentares impostos pela IAS 17 atinge clientes, fornecedores, funcionários e outras partes interessadas que baseiam decisões de contratação de longo prazo sobre a saúde financeira percebida (Cornaggia, Franzen & Simin, 2013). Na medida em que as contrapartes não avaliam corretamente o risco financeiro, a empresa se beneficia de suas informações assimétricas na contratação.…”

Section: Ias 17 E Principais Problemasunclassified