OCT 28, 2011 - 8:25 am
According to research from Grant Thornton’s International Business Report, 54% of global businesses are not aware of, and are therefore unprepared for, one the most significant global accounting changes in the past decade: the virtual elimination of off-balance sheet leases.
Awareness of the change was greatest in the United States(69%), Mexico (68%) and Chile (63%), and was lowest in mainland China (5%), Denmark (8%) and Turkey (13%).
The survey of 2,800 businesses globally was completed in early September 2011 and also found that, of those who were aware of the changes, 33% thought the change would increase cost and complexity, but only 15% thought it would increase transparency. Only 12% of business indicated they would alter the way they structure leases in the future.
According to Grant Thornton, the SEC estimated the undiscounted value of future lease payments among U.S. listed companies alone at more than $1.25 trillion in a report issued in 2005 – an amount that is greater than the gross domestic product of many countries. Globally, the figure is far greater.
To read the full news release of the survey click here.
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