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Japan drafts new accounting rules for transparency on leases

Change, coming as soon as fiscal 2026, to balloon assets and liabilities for some companies

The accounting changes are expected to have a major impact on retailers that rent store space. (Photo courtesy of Ito-Yokado)

TOKYO -- Companies in Japan will be required to put nearly all lease contracts on their balance sheets as early as fiscal 2026, according to a draft of new accounting rules, a change that would bring the country in line with international standards.

The proposal by the Accounting Standards Board of Japan aims to ensure that financial statements accurately reflect companies' actual finances amid investor criticism of the current rules.

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