CFO magazine reported in a recent post that bankers are warning that altering lease accounting could significantly change a borrower’s balance-sheet profile, possibly making it look more leveraged than it actually is.
The changes could also worsen the financial ratios that govern a loan’s covenants, to the point where the borrower is in violation of its agreement with the bank, CFO said.
CFO noted that whatever changes the boards do make, however, one thing is nearly certain: the assets and liabilities of what are now operating leases will henceforth be recorded on corporate balance sheets.
To read the CFO.com news post click here.
No tags available
Usury is the exacting, taking or receiving of a greater rate than allowed by law for the use or loan of money or a forbearance. A transaction is usurious if a loan is made at greater than the legal rate... read more
Hurricanes, wildfires and earthquakes have dominated the news headlines for the past few weeks. Watching the widespread devastation affects us emotionally as our hearts reach out to those affected. The economic toll is yet to be seen, though certainly billions... read more