The debate on rented assets capitalization: The economic impact on family firms

M. Àngels Fitó, Soledad Moya and Neus Orgaz

Journal of Family Business Strategy, 2013, vol. 4, issue 4, 260-269

Abstract: International accounting regulators wish to include “rented” assets and future payment commitments on their balance sheets. This article shows how such a proposal would affect family enterprises. Because the literature on family firms suggests that they have particular finance structures and tend to avoid excessive debt levels, a significant effect is expected. We build on the capitalization method and look for consequences on firms’ business analyses. Additionally, we run a regression analysis to determine the “family nature” effect. The results show that family firms would be significantly affected, particularly with respect to leverage. When sector is considered, the retail sector is the most affected.

Keywords: Family firms; Renting; Operating lease; Business analysis; Leverage (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:eee:fambus:v:4:y:2013:i:4:p:260-269

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DOI: 10.1016/j.jfbs.2013.10.001

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