The Impact Of New Lease Standards On Airline Aircraft Leasing And Countermeasures

In December 2018,China’s Ministry of Finance issued the revised Enterprise Accounting Standards No.21(CAS 21).China’s new lease accounting standards and the new international leasing standards converge,changing the provisions of the lessee operating lease fees under the original standards,requiring the use of leased assets and liabilities into the balance sheet,in addition to financing for sale and leaseback conditions There are also clear rules for making income.Enterprises that require simultaneous listing at home and abroad,as well as enterprises that are listed overseas and use IFRS or corporate accounting standards to prepare financial statements,shall come into force on January 1,2019.Aviation companies are one of the "large" leasing companies in the world.Therefore,it is necessary and urgent to study the leasing of leasing under the new standards for aviation companies and to propose countermeasures.In view of the impact of the newly enacted international leasing accounting standards on airlines in 2016,there have been many studies at home and abroad,but the research perspective is mainly on the financial impact of the new standards on aviation,but little research on the impact of specific leasing business.The question in this paper is the expected impact of the new leasing standard CAS21 on airline leasing activities represented by Southern Airlines.What changes will the changes in the purchase and purchase options bring to the airlines?What measures should airlines take to respond to changes in the Code?Regarding the impact of the new leasing criteria on China Southern aircraft leasing,the research findings in this paper are as follows:(1)The new leasing criteria will lead to the weakening of airline aircraft self-purchasing ability,and it is more inclined to consider introducing aircraft by lease,but a large number of leasing will be for aviation.The company continues to generate a series of undesirable chain reactions,such as a deterioration in capital structure.(2)Under the new standard,short-term leases may be favored by the aviation industry,but may cause excessive use by airlines,which will affect the stability of the fleet and daily operations,and easily become a vicious commercial competition.Short board.(3)The new standard will bring huge foreign exchange and interest rate exposure to airlines,which is unfavorable to the profitability of the aviation industry.Therefore,in view of the expected adverse effects of the new standard on airline leasing and its consequences,this paper proposes countermeasures:first,to carry out reasonable fleet planning;second,to broaden financing channels to enhance the company’s aircraft self-purchasing ability;third,to explore Innovation in the way of leasing;Fourth,to strengthen the risk management of exchange rates and interest rates.The main innovations are:research perspective innovation.Previous research perspectives are mostly the financial impact of the new standards on the aviation industry.This paper focuses on the impact of the new standards on aircraft leasing.The research value of this paper is:(1)Theoretical value:The new standard CAS21 was just promulgated in December 2018 and became effective on January 1,2019.The research on the expected impact of the standard is time-sensitive.(2)Practical value:China Southern Airlines is a representative enterprise of China’s aviation industry.The research results of China Southern Airlines have reference significance for the whole industry.