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A study on the possible impact of constructive lease capitalisation on selected listed South African companies' financial statements, in light of IFRS 16 leases
This study analyses the possible effects of constructive lease capitalisation on all companies in four sectors of the Johannesburg Stock Exchange (JSE) namely Industrial Transportation, Food and Drug Retailers, General Retailers and Travel and Leisure, in light of the impending adoption of IFRS 16.1...
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| Format: | Thesis |
| Language: | English |
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College of Accounting
2020
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| _version_ | 1867613190207045632 |
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| access_status_str | Open Access |
| author | Cape, Jared |
| author2 | Modack, Goolam |
| author_browse | Cape, Jared Modack, Goolam |
| author_facet | Modack, Goolam Cape, Jared |
| author_sort | Cape, Jared |
| collection | Thesis |
| description | This study analyses the possible effects of constructive lease capitalisation on all companies in four sectors of the Johannesburg Stock Exchange (JSE) namely Industrial Transportation, Food and Drug Retailers, General Retailers and Travel and Leisure, in light of the impending adoption of IFRS 16.1 The capitalisation is performed using a model developed by Imhoff Jr., Lipe, & David, (1997) & Imhoff Jr., Lipe, & Wright, (1991) as well as further refinements in Dillon, (2014) & Fulbier, Silva, & Pferdehirt, (2006). The analysis looks at the effects of constructive capitalisation on key leverage and profitability ratios, and line items in the financial statements. The study also assesses the impact on disclosed loan covenants and whether constructive capitalisation will result in the breach of any covenants. The results show that the adoption of IFRS 16 has an impact on key ratios and line items specifically leverage ratios and earnings before interest, tax, depreciation and amortisation (EBITDA) margin. The sector most impacted is the Food and Drug Retailers. No loan covenants were breached as a result of constructive capitalisation, however the impact on the covenants was both positive and negative. |
| format | Thesis |
| id | oai:open.uct.ac.za:11427/31384 |
| institution | University of Cape Town (South Africa) |
| language | eng |
| last_indexed | 2026-06-10T12:32:12.136Z |
| license_str | Not specified — see source repository |
| provenance_str_mv | Harvested via OAI-PMH from UCTD — University of Cape Town Open Access Repository |
| publishDate | 2020 |
| publishDateRange | 2020 |
| publishDateSort | 2020 |
| publisher | College of Accounting |
| publisherStr | College of Accounting |
| record_format | dspace |
| source_str | UCTD — University of Cape Town Open Access Repository |
| spelling | oai:open.uct.ac.za:11427/31384 A study on the possible impact of constructive lease capitalisation on selected listed South African companies' financial statements, in light of IFRS 16 leases Cape, Jared Modack, Goolam Financial Reporting Analysis and Governance This study analyses the possible effects of constructive lease capitalisation on all companies in four sectors of the Johannesburg Stock Exchange (JSE) namely Industrial Transportation, Food and Drug Retailers, General Retailers and Travel and Leisure, in light of the impending adoption of IFRS 16.1 The capitalisation is performed using a model developed by Imhoff Jr., Lipe, & David, (1997) & Imhoff Jr., Lipe, & Wright, (1991) as well as further refinements in Dillon, (2014) & Fulbier, Silva, & Pferdehirt, (2006). The analysis looks at the effects of constructive capitalisation on key leverage and profitability ratios, and line items in the financial statements. The study also assesses the impact on disclosed loan covenants and whether constructive capitalisation will result in the breach of any covenants. The results show that the adoption of IFRS 16 has an impact on key ratios and line items specifically leverage ratios and earnings before interest, tax, depreciation and amortisation (EBITDA) margin. The sector most impacted is the Food and Drug Retailers. No loan covenants were breached as a result of constructive capitalisation, however the impact on the covenants was both positive and negative. 2020-02-28T11:25:27Z 2020-02-28T11:25:27Z 2019 2020-02-28T11:07:34Z Master Thesis Masters MCom http://hdl.handle.net/11427/31384 eng application/pdf College of Accounting Faculty of Commerce |
| spellingShingle | Financial Reporting Analysis and Governance Cape, Jared A study on the possible impact of constructive lease capitalisation on selected listed South African companies' financial statements, in light of IFRS 16 leases |
| thesis_degree_str | Master's |
| title | A study on the possible impact of constructive lease capitalisation on selected listed South African companies' financial statements, in light of IFRS 16 leases |
| title_full | A study on the possible impact of constructive lease capitalisation on selected listed South African companies' financial statements, in light of IFRS 16 leases |
| title_fullStr | A study on the possible impact of constructive lease capitalisation on selected listed South African companies' financial statements, in light of IFRS 16 leases |
| title_full_unstemmed | A study on the possible impact of constructive lease capitalisation on selected listed South African companies' financial statements, in light of IFRS 16 leases |
| title_short | A study on the possible impact of constructive lease capitalisation on selected listed South African companies' financial statements, in light of IFRS 16 leases |
| title_sort | study on the possible impact of constructive lease capitalisation on selected listed south african companies financial statements in light of ifrs 16 leases |
| topic | Financial Reporting Analysis and Governance |
| url | http://hdl.handle.net/11427/31384 |
| work_keys_str_mv | AT capejared astudyonthepossibleimpactofconstructiveleasecapitalisationonselectedlistedsouthafricancompaniesfinancialstatementsinlightofifrs16leases AT capejared studyonthepossibleimpactofconstructiveleasecapitalisationonselectedlistedsouthafricancompaniesfinancialstatementsinlightofifrs16leases |