13 Nov 17

IFRS 16 has no impact on “99% of European companies”

Following the official endorsement last week of the new international lease accounting standards (IFRS 16) for use in Europe, Leaseurope calls for national authorities to avoid copying those standards over into local accounting rules. 

From January 2019, IFRS 16 will be mandatory for listed companies that follow international standards, and for some other firms. For 99% of companies however, the main impact of the new rules on their accounting will come from their property leases, not their equipment or vehicle leases; Leaseurope states.

To assist firms that need to implement the new rules, participating national leasing associations across Europe will soon launch the Leaseurope IFRS 16 Specification. 

However, the umbrella organisation for European leasing associations has deemed that IFRS 16 will place to great an administrative burden on Europe's small and medium-sized companies, without generating any corresponding benefit.    

“National standard setters across Europe must avoid any new accounting regulatory burdens on all other European companies that just want to keep investing and growing” said Leon Dhaene (pictured), Leaseurope’s Director General.

Image: Leaseurope

Authored by: Frank Jacobs