Enterprise & Equity Value
Post-ASC 842 / IFRS 16, how are operating leases handled in the EV bridge, and why did this become a live issue?
Model answer
Under ASC 842 (US GAAP) and IFRS 16, operating leases are now capitalized: a right-of-use (ROU) asset and a lease LIABILITY appear on the balance sheet. The lease liability is debt-like, so many…
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