The revision of the lease standard, IFRS 16 Leases, has had a significant impact on the financial statements of companies that lease assets.

Under the previous standard, IAS 17 Leases, lessees were required to classify leases as either operating leases or finance leases. Operating leases were not recorded on the balance sheet, but were disclosed in the notes to the financial statements. Finance leases were recorded as assets and liabilities on the balance sheet.

However, under IFRS 16, most leases are required to be recognized on the balance sheet as right-of-use assets and lease liabilities, regardless of whether they are operating or finance leases. This change has resulted in a significant increase in the reported assets and liabilities of companies that lease assets.

In addition, the new standard has changed the way that lease expenses are recognized in the income statement. Instead of recognizing lease expenses on a straight-line basis over the lease term, lessees are required to recognize depreciation expense for the right-of-use asset and interest expense on the lease liability. This has led to changes in the classification of lease expenses in the income statement and may affect certain financial ratios, such as EBITDA.

Overall, the impact of the revision of the lease standard on the financial statements of companies will depend on the extent of their leasing activities and the nature of their lease agreements.

here's an example to make it more understandable:

Let's say a company previously leased a warehouse for $10,000 per month under an operating lease. Under the previous lease standard (IAS 17), the company would not have recorded the lease on its balance sheet, but would have disclosed the lease in the notes to the financial statements. The company would have recognized lease expense of $10,000 per month in its income statement.

Under the new lease standard (IFRS 16), the company is required to recognize the lease on its balance sheet as a right-of-use asset and a lease liability. Let's say the lease has a term of 5 years and a present value of lease payments of $500,000. The company would recognize a right-of-use asset of $500,000 and a lease liability of $500,000 on its balance sheet. The company would then recognize depreciation expense on the right-of-use asset over the term of the lease and interest expense on the lease liability, resulting in different lease expense recognition in the income statement.

As a result, the company's reported assets, liabilities, and lease expenses on its financial statements would be significantly impacted by the revision of the lease standard.

Under IFRS 16, the calculation of lease liabilities and right-of-use assets is based on the present value of lease payments over the lease term, using the lessee's incremental borrowing rate. This means that the lease liability and right-of-use asset will be higher than the rent expense under the previous standard, IAS 17.

As a result, the lessee's reported assets, liabilities, and lease expenses on the balance sheet and income statement will be significantly impacted.

Specifically, the lessee's balance sheet will show a higher amount of assets and liabilities due to the recognition of right-of-use assets and lease liabilities. The impact on the income statement will depend on the type of lease and the lease term. For long-term leases, the impact will be higher, as the depreciation and interest expense will be recognized over a longer period.

In terms of profit and loss, the lessee's reported operating profit will be lower, as the higher depreciation expense will result in lower earnings before interest, tax, depreciation, and amortization (EBITDA). The lessee's net income will also be lower due to the higher interest expense on the lease liability.

Overall, the impact of the revised lease standard on a company's financial statements will depend on the extent of its leasing activities and the nature of its lease agreements. It is important for companies to carefully assess the impact of the new standard and ensure that they have adequate systems and processes in place to comply with the new requirements.