The New Lease Accounting Standard IFRS 16: The Perceptions of Jordan Financial Managers, External Auditors and External Financial Analysts
This study aimed to achieve three research objectives, first is to explore the perceptions of Jordanian interested
parties (the financial managers, external auditors, and financial analysts) about the new lease accounting standard IFRS 16.
This study uses an exploratory quantitative method and 310 questionnaire responses were obtained. The results have shown a
general believe in the need for a new lease accounting standard. Although, the results reveal that IFRS 16 would have a
negative impact on lessees’ financial statements. The results show the respondents’ general concern that lessees would
experience credit rating reduction and the lease would become less attractive. Either, the results have shown the financial
manager's concern regarding the significant additional administrative load and cost convoyed with the use of present value
method which may require some estimations. However, the use of estimations reinforces the fears of bias. This study
provides a valuable contribution to lease accounting debate; it provides a complete analysis of the IFRS 16 application’s
implications and consequences on lessee’s financial statements. This study highlights the difficulties of applying IFRS 16
which overlaps with other 15 International Accounting Standards (IAS). It requires special skills and training that financial
statements preparers and auditors may not possess. The findings of this study contributed to public interest theory of
accounting regulations and provide evidences that justify the need for lease accounting reform. However, the evidences
illustrate the respondents' divergence towards the proper methods and procedures of lease recognition and measurement.
Therefore, the IFRS 16 actual application expected impacts must be in consideration of all lease business parties (lessees,
lessors, lenders, shareholders, and government agencies).
Index terms - Lease IFRS 16, exploratory quantitative, classification, perceptions of Jordanian interested parties.