This report provides a critical review of the changes in Australian accounting standards for leases, specifically focusing on the transition from AASB 117 to AASB 16. It explores the drawbacks of the previous standard, the reasons for the change, and the key modifications incorporated in AASB 16. The report examines the impact of these changes on organizations, including the tendency of companies to classify leases as operating leases under the old standard. It also presents the views of the IASB on the benefits of the new standard and analyzes the impact on the lease market. Furthermore, the report includes a case study of Woolworths Group, analyzing their disclosures related to leases in their annual report. The analysis covers the shift from the old accounting standard to the new one and the implications for financial reporting. The report concludes by summarizing the key findings and highlighting the significance of the new standard in improving transparency and comparability in financial statements.
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