The lease item has a significant impact on the financial statements with the introduction of the new International Financial Reporting Standard 16 – Leases and aims to present this impact based on a comparison of the financial statements of the retail company dm - drogerie markt d.o.o. for the 2019. and 2020. financial year. The lease item before the application of IFRS 16 – Leases recognized leases in accordance with IAS 17 - Leases, that means lessees were not required to disclose assets and liabilities under operating leases in the financial statements, which created a misrepresentation of the lessee's financial position and indebtedness. Retail companies had a greater impact because they lease many stores, i.e., they have operating leases that according to IFRS 16 – Leases are recognized as assets with the right of use, which significantly increases the value of the balance sheet. The aim of this paper is to show how a change in the accounting treatment of lease recognition affects the financial position and performance of a retail business, and to show changes in financial indicators. The methods that are used to prove this are the method of deduction, comparison, classification and description. In the research part, the paper compares and analyze the structural balance sheet and profit and loss statement for the years when the previous and new standards were applied. At the end of the paper, conclusions and professional contribution are presented which shows how the application of the new standard affects the presented financial position and business performance of the company, because it introduces the obligation to disclose assets with the right to use in the financial statements of the lessee.