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<p>The paper assesses the effect of transitioning to IFRS 16 on Baltic listed companies’ financial performance. The results revealed that 74.63% of sample companies were affected with an average 8.68% increase in total assets and 13.03% increase in total liabilities. Return on assets and assets turnover ratios of the affected companies decreased by an average of 8.33%, the quick ratio and current ratio decreased by 7.84%, while the debt-to-equity ratio increased by 28.63%. The sectors most heavily impacted by transitioning to IFRS 16 were communication services and basic materials sectors.</p>
</abstract>

The paper assesses the effect of transitioning to IFRS 16 on Baltic listed companies’ financial performance. The results revealed that 74.63% of sample companies were affected with an average 8.68% increase in total assets and 13.03% increase in total liabilities. Return on assets and assets turnover ratios of the affected companies decreased by an average of 8.33%, the quick ratio and current ratio decreased by 7.84%, while the debt-to-equity ratio increased by 28.63%. The sectors most heavily impacted by transitioning to IFRS 16 were communication services and basic materials sectors.

Does Transition to IFRS 16 Affect Companies Financial Performance: The Case of Baltic Listed Companies

Management of Organizations: Systematic Research

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

The paper assesses the effect of transitioning to IFRS 16 on Baltic listed companies’ financial performance. The results revealed that 74.63% of sample...

Does Transition to IFRS 16 Affect Companies Financial Performance: The Case of Baltic Listed Companies

Published Online: Sep 28, 2023

Page range: 67 - 86

Received: May 30, 2023

Accepted: Aug 20, 2023

DOI: https://doi.org/10.2478/mosr-2023-0005

Keywords
IFRS 16, lease accounting, right-of-use assets, lease liability, financial performance

© 2023 Renata Legenzova et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Does Transition to IFRS 16 Affect Companies Financial Performance: The Case of Baltic Listed Companies

Published Online: Sep 28, 2023

Page range: 67 - 86

Received: May 30, 2023

Accepted: Aug 20, 2023

DOI: https://doi.org/10.2478/mosr-2023-0005

KeywordsIFRS 16, lease accounting, right-of-use assets, lease liability, financial performance

© 2023 Renata Legenzova et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Keywords
IFRS 16, lease accounting, right-of-use assets, lease liability, financial performance