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The IASB Chairperson made the following comments on the new accounting standard on Accounting for Leases: i) The new accounting standard for leases will not

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

  1. 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.

  2. ii) The new accounting standard for leases improves comparability between companies that lease assets and companies that borrow to buy assets.

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

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