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Does the IFRS 16 affect the key ratios of listed companies? Evidence from Poland

Author

Listed:
  • Białek-Jaworska Anna

    (Faculty of Economic Sciences, University of Warsaw, Warsaw, Poland .)

  • Dobroszek Justyna

    (Faculty of Management, University of Łodz, Lodz, Poland)

  • Szatkowska Paulina

    (Faculty of Economic Sciences, University of Warsaw, Warsaw, Poland)

Abstract

The paper aims to assess the International Financial Reporting Standard (IFRS) 16 “Leases” impact on the lessees’ financial situation. The study was conducted on the financial data for 2018–2019 of 494 companies listed on the Warsaw Stock Exchange using the difference-in-differences (DID) method. The hand-collected data on lease usage retrieved from the financial statements and the data for financial ratios obtained from the Orbis database were used. The research sample includes 308 preparers under IFRS and 186 entities applying accounting policies under the Polish Accounting Act. It is shown that the IFRS 16 implementation resulted in a significant increase in the debt-to-equity and debt-to-total assets ratios of lessees and a decrease in the profitability. We identified significant leverage increase in the trade and services sectors. The results confirm the conclusions of previous studies based on estimates, whose authors expected a significant differential effect of IFRS 16 implementation between industries.

Suggested Citation

  • Białek-Jaworska Anna & Dobroszek Justyna & Szatkowska Paulina, 2022. "Does the IFRS 16 affect the key ratios of listed companies? Evidence from Poland," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 58(3), pages 299-315, September.
    • Handle: RePEc:vrs:ijomae:v:58:y:2022:i:3:p:299-315:n:4
    DOI: 10.2478/ijme-2022-0016
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    References listed on IDEAS

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    More about this item

    Keywords

    difference in differences; leverage; profitability; leasing;
    All these keywords.

    JEL classification:

    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • M48 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Government Policy and Regulation

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