Lease Accounting News

The Latest Media Coverage and Announcements for the New Standards

Keep up with the latest lease accounting news with this comprehensive list of  announcements related to the standards. The links below provide the latest trade journal articles, technical accounting publications, research study findings, trainings, and certification courses.

Lease accounting changes expected to cost millions

By Michael Cohn
December 4, 2018

Companies are expanding their budgets to accommodate the new lease accounting standard, turning to interim solutions, temporary employees and outside consultants, with many of them expecting to spend millions of dollars on the effort, according to a new survey by Ernst & Young.

The New Lease Accounting Standards – Are You Ready for January 2nd, 2019?

By Colleen Tigges
December 4, 2018

With the deadline so close, many organizations are understandably focused on achieving compliance. However, an equally important consideration is how to maintain compliance after the deadline has passed.

A welcome change in lease-accounting rules

By Prateek Gakhar, Jyotsna Goel, and Werner Rehm
November 2018

For decades, investors, credit-rating agencies, and analysts assessing the relative performance of companies with large portfolios of leases have capitalized off-balance-sheet leases as assets rather than expenditures. Now, after much deliberation, the rules are catching up to common practice: in 2019, all leases longer than 12 months will have to be recognized on the balance sheet as a “right of use” asset and a corresponding financial liability.

FEI publishes guides to internal controls for leasing and CECL standards

Michael Cohn
November 16, 2018

Financial Executives International has released two guides to help CFOs, controllers and other senior finance execs address the internal control considerations for the new lease accounting and credit loss standards.

ASC 842 Implementation Countdown

Michael Keeler
November 8, 2018

or year-end public company filers, the deadline to implement the new lease-accounting standards (ASC 842 in the U.S. and IFRS 16 internationally) is January 1, 2019—less than 60 days away. Most companies have been focused on collecting all the necessary lease data to achieve compliance, but that is only one piece of a successful transition. For those nearing implementation, here are 11 key issues to consider in the last 60 days.

New rules force retailers to rethink lease accounting

Jonathan Eley
October 28, 2018

What the retail industry needs to know about IFRS 16 on the balance sheet, profits, debt covenants, and more according to the Big 4. Subscription Required.

The 10 Key Issues to Consider in the Last 90 Days Before the Lease Accounting Deadline

October 17, 2018

For year-end public company filers, the deadline to implement the new lease accounting standards (ASC 842 in the U.S. and IFRS 16 internationally) is on January 1, 2019 - less than 90 days away. Most companies have been focused on collecting all of the necessary lease data to achieve compliance, but that is only one piece of a successful transition.

CFOs Fret About Loans on the Eve of New Accounting Rule

Tatyana Shumsky
October 11, 2018

A change in how companies account for leases is threatening to upend corporate-loan agreements and prompting finance chiefs to search for solutions.

Are You Ready for ASC 842?

Jeanne McGovern and Sean Torr
October 9, 2018

The new standard for lease accounting (Accounting Standards Codification 842) is intended to provide investors and other stakeholders with a more complete and transparent view of a US company’s financial position with respect to leasing activities.

Lease tools emerge to aid in last-minute adoption work

Tammy Whitehouse
October 3, 2018

Software firm LeaseAccelerator has published a checklist of 90 items companies can use to make sure they haven’t missed any important aspects of adopting the new rules under Accounting Standards Codification Topic 842.

Three hidden real estate lease accounting challenges under the new standard

Scott Silver
September 19, 2018

[M]any companies are finding that the accounting for real estate assets is trickier than expected. There are three big challenges that companies with large real estate lease obligations are encountering when transitioning to the new standard.

Leases And Rev Rec: It's Not How Much You Spend, But How

Olivia Berkman
September 12, 2018

FEI Daily spoke with PwC Partner Sheri Wyatt about the differences between implementing the revenue recognition and leasing standards, from system solutions to complexity to cost.

Lease accounting implementation insights: Lessons learned en route to adopting ASC 842

September 2018

A recent PwC survey found that only 1% of companies had completed adoption of the new lease accounting rules. For the other 99%, we offer some lessons learned to date from companies that have already made substantial progress with their implementations to help smooth the path forward.

Most Finance & Accounting Leaders Still Need a Dedicated Software System for the New Leases Standards

Olivia Berkman
September 4, 2018

Organizations are challenged to assess needs, design specifications, and oversee the implementation of new IT solutions, and time is running out. According to new research by Deloitte, most finance and accounting leaders plan to finalize the design of required changes by mid-year 2018 and complete implementation by December 31, 2018.

Things You Should Do to Prepare for the Effective Date of the New Leasing Standards--With Limited Time Left to Implement

Xing Gao
August 27, 2018

We are counting down to the effective date for the new lease accounting standards, but if you are not fully prepared for the implementation, don’t worry you are not alone.

Implementing the New Lease Accounting Standards

Norman Strauss, Marc Siegel, Mark LaMonte, Amie Thuener, Scott Taub, and Prabhakar Kalavacherla
August 2018

The panel began with Siegel outlining FASB’s development of the long-gestating lease accounting standard. “The idea was to try to take operating leases, which traditionally … have been added back to the balance sheet using the disclosures, and try to make that a little bit easier by actually presenting them on the balance sheet through recognition and measurement.”

FASB proposes tweaks for leasing standard

Michael Cohn
August 13, 2018

The Financial Accounting Standards Board is proposing to make a number of narrow improvements in the lease accounting standard as public companies get ready for it to take effect at the end of the year.

Optimizing the Four Critical Steps to Meet the Lease Accounting Compliance Deadline

Colleen Tigges
August 13, 2018

Simply finding existing leases and extracting the necessary data is more time-consuming than many companies anticipated. However, there are some steps companies can take to optimize their data collection process.

IFRS 16 Leases: impact, challenges and solutions

August 11, 2018

Aiming to bring more transparency to leases in companies’ financial statements, the new standard will not only impact finance and accounting but will also result in major changes in data processing and related processes.

Who’s Ready for ASC 842?

Michael Keeler
August 1, 2018

Of the 100 companies whose disclosures we evaluated, more than three-quarters have determined that the new lease-accounting standard will have a material impact on their balance sheets, but few have provided a quantitative estimate of it.

FASB attempts to make lease accounting implementation easier

Ken Tysiac
July 30, 2018

FASB has issued targeted changes to its new lease accounting standard that are designed to make implementation easier and reduce costs for financial statement preparers.

As Effectivity of IFRS 16 Looms, CFOs May Have Less Time Than They Think

Cesar Bacani
July 23, 2018

At the 5th CFO Innovation Forum in Manila in June, Shahzad Mahmood had sage advice to the finance professionals in attendance. Don’t underestimate the impact of IFRS 16: Leases on your financial statements, he warned.

Unlock the Hidden Benefits of Lease Accounting Rules

Bill Maloney, Udit Sharma and Patrick Garrett
July 23, 2018

Can companies unlock certain operational benefits, thereby reducing costs and increasing the bottom line, as part of adopting this new guidance? In a word: Absolutely.

Preparing for IFRS 16

Treasury Today
July 2018

Keeler adds that achieving greater visibility into companies’ leasing programmes can bring opportunities for treasurers to identify unnecessary costs.

FASB issues 16 minor amendments to lease accounting standard

Ken Tysiac
July 19, 2018

FASB issued 16 minor amendments to its new lease accounting standard Thursday, clarifying rules and correcting application of guidance that the board had not intended when it created the standard.

New SEC Disclosures Show Major Impact to Balance Sheets From New Lease Accounting Standards, What Companies are Doing About It

July 17, 2018

These companies have hundreds to thousands of leases to analyze, a time-consuming process. Despite the scale of the project, of the 100 companies analyzed, 82% of companies were able to conclude that there would be material impacts to the company balance sheet.

Management accountants grapple with new standards

Michael Cohn
June 20, 2018

Jonathan Crawford, chief technology officer at LeaseAccelerator, has been seeing some problems with the leasing standard, which is far less converged than the revenue recognition standard.

What You Should Know When Choosing a Lease Software Solution

Xing Gao
June 6, 2018

First of all, Torr said, companies need to keep in mind that they are not just looking for a “one-time” implementation tool, they are looking for a long term solution.

Lease accounting standard proves daunting for many

Michael Cohn
May 30, 2018

With the effective date for the new lease accounting standard taking effect at the end of the year for public companies, many are finding themselves unprepared and their accounting systems in need of an upgrade.

Differences between the FASB and IASB lease accounting standards, and how companies can prepare for both

Alex Klein
May 24, 2018

While the standards are similar in many ways, FASB and IASB failed to converge on several key points that will create changes in the accounting processes. Here’s what U.S. based companies reporting internationally need to know about that other set of standards, IFRS 16.

Five Big Budget Line Items to Consider in your Lease Accounting Project

Scott Dunnihoo
April 25, 2018

The biggest mistake we see companies make as they initiate their accounting projects is underestimation. Whether it is the business assessment to determine new leasing processes, the level of internal and external resources required to execute a global business transformation, or the investment associated with a system fully capable of performing lease accounting compliance, the simple fact is that the budget needed for the lease accounting project is bigger than you think.

This next accounting rule change will add liabilities to every balance sheet

Francine McKenna
April 24, 2018

The new rules require companies to record liabilities for operating leases on their balance sheet for the first time ever. As the deadline draws closer, public companies are required to include a discussion of the potential future impact of the new rule on their financial statements. But many companies appear unprepared for the change, according to Michael Keeler, chief executive of LeaseAccelerator Inc., a provider of software-as-a-service, or SaaS, for enterprise lease accounting.

Companies foresee major impact from lease accounting standard

Michael Cohn
April 18, 2018

More than three-quarters of the top 100 U.S. companies with the biggest lease obligations expect to see a material impact on their balance sheet from the new lease accounting standard, according to a new report. The report, from the technology company LeaseAccelerator, analyzed a recent set of Securities and Exchange Commission filings related to the adoption of the leasing standard, also known as ASC 842, which takes effect for public companies at the end of this year.

How FASB’s new ASC 842 transition option will affect lessees and investors

Michael Keeler
April 11, 2018

However, as FASB notes, the new method only changes when a company has to apply the transition requirements. It does not change how the transition requirements are applied. Therefore, the new transition method is not a cure for the compliance burden created by ASC 842. In addition, it is not without its downside.

Standing Apart – Helping Lessees Adapt to the New Lease Accounting Standards

Scott Dunnihoo
March 21, 2018

Big Four accounting firms, and other lease accounting experts have all determined that the standards will have minimal direct impacts on lessors. However, the standards will place a large administrative burden on lessees. The big question experts are asking is, will that burden cause companies with large lease portfolios to forego leasing in favor of purchasing their assets in the future?

New Accounting Rule Moves Moody’s to Reevaluate Leases

Tatyana Shumsky
March 20, 2018

Moody’s Investors Service Inc. is proposing changes to how it treats leases in response to new U.S. and international accounting rules, the credit ratings firm said on Monday. Public companies will be required to report operating leases on their balance sheets for fiscal years that begin after Dec. 15, 2018 under new U.S. accounting standards.

Weary from accounting change, companies gear up for leases

Tammy Whitehouse
March 20, 2018

With year-end reporting and revenue recognition implementation nearly complete, public companies are preparing for their next accounting freakout—this time over leases. Recent polls suggest companies have a lot of work to do to get ready for the next big rule, Accounting Standards Codification 842 on leasing, which takes effect Jan. 1, 2019, for public companies. Subscription required.

FASB ASC 842 - Comparative Years No Longer Necessary for Lessees

Mike Hammerslag
March 13, 2018

The Financial Accounting Standards Board (FASB) has affirmed a new method of transition that eliminates the need for companies to provide comparative financial statements under ASC 842 for the prior two (2) years (i.e., 2017 and 2018). Instead, firms should present (continue to maintain) their disclosure for these years under ASC 840.

Preparing for the new lease accounting standard

Dustin Hindman
March 12, 2018

As organizations evaluate their leasing activities, many are realizing that most leasing activities are decentralized, with various groups managing the lifecycle of leasing in silos. This is causing leaders to think about Day 2 of the new leasing standard – i.e., maintaining compliance for the long term, not just for Day 1.

How Many Leases Do You Have?

Sponsored by Genpact
March 5, 2018

The information deficit is widespread. Even Fortune 500 companies are substantially underestimating their lease totals, according to research from LeaseAccelerator, a leading provider of lease accounting technology.

New poll shows strains as companies prepare for lease rules

By Tammy Whitehouse
February 26, 2018

Another recent survey on lease accounting shows some stress in the system as companies wrap up one huge accounting standard adoption and dig into the next one.

Most companies are struggling with new lease accounting standard

By Ranica Arrowsmith
February 26, 2018

Three quarters of companies find the new lease accounting standard set forth by the Financial Accounting Standards Board to be more complex than expected.

Managing the implications of IFRS 16

By Steven Fox
February 1, 2018

The impact of IFRS 16 is expected to be pervasive, and with the deadline approaching fast the need for clarity is paramount. Even for small to medium-sized businesses, the task of becoming fully compliant is intricate and labour-intensive.

Tips for Lease Accounting Implementation

By Liz Farr
January 30, 2018

In some cases, locating all of a company’s leases and extracting the data required to comply with the standard has been a serious challenge for financial statement preparers. Lerner’s group began planning the work in the summer of 2016 and is still working on it.

SAB 74 disclosures for new standard on lease accounting

Financial Reporting Insights
January 30, 2018

There has been a lot of discussion about the SAB 74 disclosures related to FASB Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606), but registrants are reminded to also provide transparent disclosure about progress toward implementation of ASU 2016-02, Leases (ASC 842).

FASB clarifies lease standard’s application to land easements

By Ken Tysiac
January 25, 2018

FASB issued an Accounting Standards Update (ASU) on Thursday that clarifies the application of the board’s new lease accounting standard to land easements and makes adopting the leases standard easier for some land easements.

VIDEO: SEC’s Bricker Highlights Major Upcoming Accounting Issues

By Todd Cheney
January 19, 2018

Securities and Exchange Commission Chief Accountant Wesley Bricker said the agency will carefully watch how well companies disclose the impact of accounting rules that are approved but not yet implemented, required by Staff Accounting Bulletin 74.

Finance Execs Worried about Internal Controls and Lease Accounting

By Michael Cohn
January 17, 2018

“The day 1 challenge is you’ve got to find all the data and you’ve got to put it in all the systems so you’ve got compliance. The day 2 challenge is really about staying compliant,” said Michael Keeler, CEO of the technology company LeaseAccelerator.

Seven Lease Accounting Lessons Learned from Early Implementation Projects

By Michael Keeler
January 16, 2018

The implementation dates for FASB’s ASC 842 standard are quickly approaching. Yet, most companies adopting the new standard haven’t even reached the halfway point in their implementation projects. However, there are a few early movers who have made significant progress in the transition, which begs the question – what lessons have they learned?

FASB Seeks Cut in Lease-Accounting Costs

By David M. Katz
January 11, 2018

Instead of companies having to apply the requirements of the standard to their 2017, 2018, and 2019 balance sheets, FASB proposed last week that companies should have the choice to report “the cumulative effect” of the changeover in just their 2019 financials.

Proposed Changes to Lease Standard Offer Simpler Transition

By Thomson Reuters Tax & Accounting
January 9, 2018

Companies adopting the FASB’s sweeping new lease standard would get a break on the transition process under a proposed change from the accounting board.

FASB Proposes Tweaks to Leasing Standard

By Michael Cohn
January 5, 2018

The Financial Accounting Standards Board is proposing a new accounting standards update to reduce the costs of the new lease accounting standard and make implementing it a little easier.

Companies to Get Cost-Relief Option in Lease Rule Transition

By Denise Lugo
November 30, 2017

Companies adopting new lease accounting rules will likely get some relief from costs when shifting to the rules because of an option that U.S. accounting rule makers will provide. (Subscription Required).

FASB plans to ease lease accounting requirements

By Michael Cohn
November 29, 2017

The Financial Accounting Standards Board decided during a meeting Wednesday to ease some of the implementation burdens and possible costs of the new lease accounting standard by making several adjustments and offering some practical expedients.

The Potential Impact of Lease Accounting on Equity Valuation

By Matthew A. Stallings
November 2017

This article offers an example of equity valuation and examines the different results that arise from the new leasing standard effects that underlie adjustments to valuation model inputs and estimations.

Do You Know Where Your Leases Are?

By Ryan Drimalla
November 27, 2017

Complying with the new lease accounting standard will require collecting data from lease contracts across numerous locations and geographies.

The Challenges of Accounting Change: A Q&A With KPMG’s Marybeth Shamrock

By Olivia Berkman
November 22, 2017

FEI Daily spoke with Steve Thompson, KPMG’s Advisory lead for Revenue Recognition and Marybeth Shamrock, KPMG’s Advisory lead for Leasing, following the release of KPMG’s 2017 Accounting Change survey results.

Companies implement technology to tackle revenue recognition and leasing standards

By Michael Cohn
November 15, 2017

The revenue recognition standard takes effect for public companies starting in December, while the leasing standard takes effect next December, but many companies are still not ready for either standard.

Practical Illustrations of the New Leasing Standard for Lessees

By Robert L. Paretta
October 2017

After a nearly 10-year collaboration to develop a converged standard on leasing, on Jan. 13, 2016, the IASB issued IFRS 16, Leases, and on Feb. 25, 2016, FASB issued Accounting Standards Update (ASU) 2016-02, Leases—Topic 842.

How Should Auditors Get Ready for the New Lease Accounting Rules?--Get Sufficient Documentation; Question the Assumptions Used

By Xing Gao
October 11, 2017

While companies are implementing the new lease accounting standards, auditors are getting ready to conduct audits under the new rules. Bloomberg BNA interviewed Paul Becht, partner of Margolin, Winer & Evens LLP, who explained some of the challenges auditors will face and what they need to look out for under the new leasing rules.

Six ways to minimize the financial impact of new lease accounting standards

By Steve Miller
September 26, 2017

Corporate real estate decision-makers and brokers, brace yourself. With the new lease accounting standards effective in 2019, real estate decisions are about to get more complicated.

FASB proposes clarifying land easements guidance in leases standard

By Ken Tysiac
September 25, 2017

FASB on Monday proposed clarifying the application of guidance in its new lease accounting standard to land easements.

Microsoft Scales Accounting Mountain

By David M. Katz
August 4, 2017

In a move only a company as massive as Microsoft would consider making, the company is planning to offer a set of restated financial statements on Oct. 1 that reflect its early adoption of both of the Financial Accounting Standards Board’s two major new standards, the rules covering revenue recognition and lease accounting.

Why Lease Accounting Laggards Face Serious Risks

By Ken Tysiac
August 3, 2017

Cathy Clarke, CPA, worries that companies are underestimating the amount of work required to implement FASB’s new lease accounting standard.

Lease accounting | Frequently asked questions

August 1, 2017

Why are the FASB and the IASB changing accounting for leases? A 2005 SEC survey estimated the off-balance sheet obligation associated with operating leases for public companies at $1.25 trillion. In 2016, the FASB and IASB issued new standards to bring these obligations on the balance sheet.

Microsoft Among First to Give Fuller Picture of Lease Situation

By Denise Lugo
July 6, 2017

Microsoft’s investors and analysts will be among the first to view the significance and effects of new lease accounting rules that require companies to disclose on their balance sheets the full extent of the leases they carry.

Wall Street Journal Lease Accounting article

Tech Teams Rush to Catch Up as New Accounting Rule Looms

By Vipal Monga
June 5, 2017

A major accounting rule change is stressing finance staff and creating headaches for technology departments at some of the world’s largest businesses.

Wall Street Journal Lease Accounting article

Why Retailers Have More Debt Than Meets the Eye

By Miriam Gottfried
June 1, 2017

With net cash on its balance sheet, Abercrombie & Fitch ANF -2.40% seems like an easy acquisition target, despite years of declining sales.

Avison Young

Avison Young Study Reveals Companies are not Prepared for FASB and IASB New Leasing Standards

April 13, 2017

Avison Young announced today that research from an internal study indicates that numerous companies are unaware of the impact that the FASB and IASB's new lease accounting standards will have on their enterprise value.

Interim Rents Under ASU 842: Lessees & Lessors Take Note

By Bill Bosco
March / April 2017

Bill Bosco examines interim rent accounting under ASU 842, including implications for both lessees and lessors. He encourages lessors to become very familiar with the new lessee accounting rules as they will have a large impact on their lessee customers.

Are Companies Starting to Make Progress on Lease Accounting?

By Terry Sheridan
March 28, 2017

In a finding that surprised even the survey’s sponsor, a majority of respondents to a survey conducted by LeaseAccelerator indicated they are well on their way to adopting the Financial Accounting Standards Board’s (FASB) new lease accounting rules.

Get Ready to Face a Trifecta of Accounting Standards

January 23, 2017

The Big 3 Accounting Standards Updates (ASUs) ─ ASU 2014-09, Revenue from Contracts with Customers, ASU 2016-02, Leases, and ASU 2016-13, Financial Instruments – Credit Losses ─ from the Financial Accounting Standards Board pose significant challenges for CPAs.

5 strategies to efficiently implement the new lease accounting standard

By Sabine Vollmer
January 19, 2017

As mandated by regulators, Sealed Air is implementing the new lease accounting standard on schedule.

Vince Baczor warns: "Very few companies have begun to prepare properly for the pending IFRS16 lease accounting changes"

By Brian Rogerson
January 12, 2017

With 25 years in asset lease portfolio management, and having designed and developed three specialist software systems, Vince Baczor is widely considered a global thought leader on the subject.

New Accounting Rules Spell Big Changes for Public Companies

By Denise Lugo
January 12, 2017

Public companies—including Inc. and Microsoft Corp.—are gearing up for the most historic accounting changes to hit U.S. capital markets in decades.

Start Preparing Now for New Lease Accounting Rules

By Sean Moynihan
December 29, 2016

The new lease accounting rules will have far-reaching implications for both public and private companies.

New accounting standards change the rules of IT leasing

By Stephanie Overby
December 23, 2016

The Financial Accounting Standards Board’s new lease accounting standards announced earlier this year will require public companies to recognize assets and liabilities from operating leases on their balance sheets for fiscal years beginning after December 15, 2018.

Bigger Impacts Ahead From Lease Changes Than Almost Anyone Realizes

By Joseph Bailey
December 13, 2016

The accounting treatment of leases has been a hot topic for more than a decade as standard setters and businesses attempt to comply with off-balance sheet reporting requirements addressed by the Sarbanes-Oxley Act.

Top 5 Biggest Changes With The New Lease Accounting Standard (ASC 842)

By Amber Albert
August 16, 2016

How would you like your balance sheet to blow up by $18.2 billion? That’s the amount of Verizon’s minimum future rental payments under non-cancelable operating leases reported in their most recent Form 10-K.

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