The Impact of Implementing International Financial Reporting Standard (IFRS) 16 on Enhancing the Quality of Accounting Information

Authors

Abdelrahman Khattab, Applied Science Private University - JordanFollow
Mahmoud Nassar, AL Ain University - UAEFollow

DOI

https://doi.org/10.35192/jjoas-h.v29i2.1

Abstract

This study aims to examine International Financial Reporting Standard (IFRS) 16, related to leases, and its impact on the quality of accounting information, particularly regarding relevance and faithful representation. The previous standard, IAS 17, faced challenges, notably the failure to recognize operating leases as assets and liabilities on the balance sheet, which hindered an accurate depiction of a company's financial position. The introduction of IFRS 16 addresses these issues and is considered a positive step toward improving financial reporting by enhancing the quality of accounting information. A descriptive analytical approach was employed, utilizing a questionnaire distributed to external auditors. One important finding is that the majority of external auditors support the implementation of IFRS 16, as it aligns with their expectations and remedies the shortcomings of IAS 17. The study recommends adopting IFRS 16 to leverage its significant benefits in improving accounting quality. Additionally, it suggests overcoming challenges associated with the new standard through organized conferences and the publication of scientific journals to facilitate its effective adoption.

Recommended Citation

Khattab, Abdelrahman and Nassar, Mahmoud (2021) "The Impact of Implementing International Financial Reporting Standard (IFRS) 16 on Enhancing the Quality of Accounting Information," Jordan Journal of Applied Science-Humanities Series: Vol. 29: Iss. 2, Article 1.
DOI: https://doi.org/10.35192/jjoas-h.v29i2.1
Available at: https://digitalcommons.aaru.edu.jo/jjoas-h/vol29/iss2/1