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What has happened
Since the release of the new US GAAP and
IFRS lease accounting standards in early 2016,
most corporations have primarily focused on
learning about new reporting requirements and
key implications for real estate (and equipment)
leasing.
As we progress through 2017, corporations are
drastically shifting focus from education to
mobilization asking the question, what steps
need to be taken in order to comply with the
new requirements by the first reporting period of
2019?
What you need to know
• New lease accounting standards (US GAAP ASC 842 and
IFRS 16) were released in early 2016.
• The rules go into effect in 2019 for public companies and
2020 for private organizations.
• These new rules apply only to companies that issue financial
statements in accordance with US GAAP and/or IFRS (all
public companies and certain private businesses.)
• The major provision of the new rules is that all leases
(12 month or greater) will now be reported on the balance
sheet. This is a significant shift from the current rules that
allow most leases to remain off balance sheet.
Lease Accounting Changes:
Time to Mobilize
THE LEASE ACCOUNTING CHANGES WILL HAVE IMPLICATIONS ON
AND REQUIRE CHANGES TO DATA MANAGEMENT, TECHNOLOGY,
LEASING POLICY, GOVERNANCE AND FINANCIAL REPORTING
PROCESSES. TIME TO ACT IS NOW.
VALIDATE
EXISTING LEASE
PORTFOLIO
DETERMINE
ACCOUNTING
POLICIES
EXAMINE
RELEVANT DATA
ASSESS
TECHNOLOGY
READINESS
1
2
4
5
3
2017 Actions
$
FINANCIAL IMPACT
ASSESSMENT
62 The Occupier Edge