Some may disagree with the concerns we have pointed out in the previous section, arguing that adequate disclosure would allow financial statement users to identify the differences among lease arrangements. However, prior research has shown that individuals tend to fixate on accounting numbers. That is, individuals tend to accept accounting numbers in financial statements without unscrambling the underlying assumptions used in arriving at those numbers (e.g., Hand 1990; Luft and Shields 2001). They are also overly affected by where accounting numbers are located in
financial statements, holding constant the underlying economics (Hopkins 1996). To the extent that individuals do not unscramble the assumptions used in arriving at an accounting number, they could inappropriately judge firms that are economically equivalent (except for their choice of accounting alternatives) to be different.