I am working on the valuation of an airline. The company's fleet is held via a mix of operating and finance leases. My boss wants me to convert the operating leases to finance leases. This means taking lease expenses out of operating expenses and capitalizing them as debt (which I've found that rating agencies typically do by just multiplying annual expense by 7). However, then you have to come up with the implied interest expense and principal payments on this "operating lease debt" (which he says should basically equal the current lease expense) as well as come up with some kind of estimate of the depreciation on these aircraft.