The impact of applying IFRS 16 (lease contracts) in predicting financial failure(An analytical study on the Syrian telecom sector)

Abstract

The research aimed to demonstrate the effect of applying the International Financial Reporting Standard 16 (lease contracts) in predicting financial failure, and the researcher adopted the analytical descriptive approach. The researcher tried to find out the impact on predicting the failure of facilities or their continuity by studying the Syrian telecommunications sector on a sample of companies listed on the Damascus Stock Exchange, including two companies (mtn, Syriatel), during the financial period of the years 2019-2022. The Fixed Effect Model was relied upon. The research found that there are statistically significant differences in the financial position statement, the income statement, financial indicators, and models that show the impact of applying International Financial Reporting Standard 16 (lease contracts) in predicting financial failure in the telecommunications sector. The effect was negative, which indicates that the application of the IFRS 16 standard reduced the Z-Altman value of the two study sample companies, and raised the possibility of financial failure. Without moving from a good financial situation to uncertainty or the possibility of financial failure.