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The Chairperson of the IASB made the following comments on the new accounting standard on Accounting for Leases: i) The new accounting standard for leases

The Chairperson of the IASB made the following comments on the new accounting standard on Accounting for Leases:

  • i) The new accounting standard for leases will not be popular with everyone. For example, the new accounting standard will unfavorably affect entities with debt-to- asset constraints.
  • ii) The new accounting standard for leases improves comparability between companies that lease assets and companies that borrow to buy assets.

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Discuss both of the above comments, evaluating their validity and relevance to both existing and future finance contracts."

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