Capital vs. Operating Leases: Their Impact on Financial Statements Presentation

Date of Submission

1981

Document Type

Thesis

Degree Name

Master of Science in Accounting

Department

Accounting

LCSH

Leases--Accounting, Financial statements

Call No. at the Univ. of New Haven Library

AS 36 .N29 Acc. 1982 no.2

Abstract

This research follows the development of standards of financial accounting and reporting by lessees and lessors.

During the last thirty years, increasing attention has been given to the disclosure of long-term leases in the financial statements of lessees and lessors.

In early 1962, the AICPA published the first long study in this subject. During the ten years following this study the APB clarified the criteria to be used in the identification of the leases, which should be disclosed in the financial statements of lessees and lessors.

Despite the attention that the accounting profession has given to these criteria, inconsistencies remain in lease accounting practices, and differences of opinion as to what should be done about them remain.

In November, 1976, the FASB issued the final rules and criteria (Statement No. 13) for accounting for leases. This statement supersedes all the preceding rules and criteria on this subject.

This research project goes beyond FASB Statement No. 13 and summarizes the essential standards generated subsequent to the major pronouncement. Thus this thesis can be used as a reference for practitioners and students to obtain, in one text, a complete summary of the current standards relating to leases.

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