In 2016, IASB has published a new lease accounting standard International Financial Reporting Standard (IFRS) 16 to replace the previous one “IAS 17” and the new standard will be implemented from 1 January 2019 onwards. The new standard eliminates the distinction between operating lease and finance lease, and requires the lessee to record an asset and a liability for an operating lease in financial statements. The objective of this dissertation is to examine how IFRS 16 would change the financial position and financial performance of the lessee. The study sample comprises 31 airline companies worldwide for the period from 2013 to 2015 and adopts the constructive capitalization method developed by Imhoff et al. (1991). Results indicate that after capitalization, there will be €1,724.7 million of unrecorded lease liabilities, which is 30.68% of the total reported liabilities for the 31 sample companies. After capitalization, both leverage ratio and profitability ratio increase. The additional test for negative and positive income effect provides a closer insight into the companies’ reform. After capitalization, positive income sub-group experiences an increase in both ROA and ROE ratios, while negative income sub-group experiences a decrease in both ratios. In addition, to estimate the change on companies, this paper ranks the companies according to the ratios before and after capitalization. The rank difference after capitalization means the company presents a positive performance may exist in higher risks and negative financial ratios under the new lease standard when comparing with peers. In general, the results suggest that IFRS 16 would have a material impact on the financial statements and financial ratios of the lessee, and this paper provides valuable information for financial statement users when transiting to the new standard.