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Avoiding Top 6 Common Pitfalls in ASC 842 Compliance
ASC 842 compliance presents challenges such as lease misclassification, poor data management, and incorrect discount rates. This guide covers the top 6 key pitfalls, solutions, and resources to help businesses navigate lease accounting effectively and stay compliant…
Navigating ASC 842’s Impact on Loan Covenants
ASC 842 changes lease accounting, impacting loan covenants by increasing liabilities and altering financial ratios. Learn how to navigate these challenges effectively…
Navigating EBITDA-Based Covenants Under ASC 842
ASC 842 alters EBITDA calculations by reclassifying lease expenses, impacting loan covenants. Companies must adapt to lender adjustments and ensure compliance…
How ASC 842 Impacts Financial Ratios and Loan Covenants
The adoption of ASC 842 has reshaped financial reporting by requiring operating leases to be recognized on the balance sheet. This shift impacts key financial ratios such as debt-to-equity, EBITDA, and return on assets, potentially affecting loan covenant compliance. Companies must reassess their financial strategies to manage these changes effectively…
Essential Fleet Vehicle Lease Terms for Lease Abstraction
Understanding fleet vehicle lease terms is essential for effective lease abstraction. This guide breaks down key terms like base rent, escalation clauses, and tenant improvement allowances…
Essential Real Estate Lease Terms for Lease Abstraction
Understanding real estate lease terms is essential for effective lease abstraction. This guide breaks down key terms like base rent, escalation clauses, and tenant improvement allowances…
Key Equipment Lease Terms to Know
Understand critical equipment lease terms like base rent, fair market value leases, and escalation clauses to make informed leasing decisions…
CPA's Safeguard ASC 842 Compliance and Avoid Audit Failures
Audits under ASC 842 can be challenging, but with the right strategies, you can avoid errors and ensure compliance. Discover how centralized lease data, automation, and robust processes help safeguard your audit readiness and protect your clients from non-compliance risks…
Equipment-as-a-Service (EaaS) and ASC 842 Explained
Equipment-as-a-Service (EaaS) shifts equipment acquisition from ownership to a subscription-based model, aligning costs with usage and offering flexibility. EaaS enhances operational efficiency and ensures access to the latest technology. Under ASC 842, these arrangements often involve lease classification, variable payments, and embedded leases, requiring careful management for accurate financial reporting. By adopting EaaS, businesses can adapt to changing demands while staying compliant with lease accounting standards…
Calculate IBR for ASC 842 Compliance
The Incremental Borrowing Rate (IBR) is crucial for ASC 842 compliance, determining the present value of lease liabilities and right-of-use assets. This guide provides step-by-step instructions to calculate the IBR, including assessing creditworthiness, identifying market interest rates, and adjusting for lease-specific factors. Avoid common pitfalls like relying solely on risk-free rates and ensure accurate documentation. Tools like iLeasePro can simplify the process by automating calculations and ensuring compliance…
Lease Amortization Red Flags to Watch For
Discover key red flags in lease amortization schedules that can signal financial risks, compliance issues, or operational inefficiencies. Learn to identify signs such as misaligned liabilities, ROU asset discrepancies, payment irregularities, and interest calculation errors. Addressing these issues ensures accurate ASC 842 compliance, transparent reporting, and improved lease management…
Overpayments from Mismanagement of Lease Portfolios
Overpayments in lease management often result from mismanaged data, billing errors, unutilized options, and overlooked market changes. Strategies like centralized systems, proactive monitoring, audits, and renegotiation can minimize costs. Tools like iLeasePro ensure compliance, accuracy, and efficient lease management, reducing unnecessary expenses and optimizing lease portfolios…
What is Lease Liability under the ASC 842?
This post explains the concept of lease liability under ASC 842, a critical component of modern lease accounting. Discover how to calculate lease liability, understand its implications, and review example amortization schedules for operating and finance leases to ensure compliance with the standard…
Cost Management Strategies for Lease Management
Cost management in lease accounting is essential for minimizing expenses and ensuring compliance with standards like ASC 842 and IFRS 16. This blog outlines key strategies such as lease cost optimization, utilization efficiency, centralized management, and compliance integration. Discover actionable insights to rationalize your lease portfolio, leverage technology, and enhance decision-making to achieve better financial and operational outcomes…
What Is a Right-of-Use Asset? ASC 842 Calculation Guide
Under ASC 842, a Right-of-Use (ROU) Asset reflects the lessee’s right to use a leased asset during the lease term. It is calculated by summing the initial lease liability, prepaid lease payments, and initial direct costs, then subtracting lease incentives. This blog explains the calculation process in detail, complete with an example, and covers the importance of ROU assets in financial reporting. Stay ASC 842 compliant with this simple guide…
The Link Between Documents and Compliance in Lease Management
We all know that documentation and compliance has become extremely important in our current business environment, i.e., clear and complete explanations as to why certain actions or changes have been made and the ability to identify the source of those changes. But sometimes it can be time consuming and difficult to provide the documentation and identification…
Lease Management LLC: Expert Lease Abstraction for Compliance
In a major move to enhance lease management processes, iLease Management LLC has launched a Comprehensive Lease Abstraction Service aimed at helping businesses achieve improved compliance and operational efficiency. This new offering is tailored to assist organizations in navigating the complexities of lease accounting and management, especially with the evolving demands of standards like ASC 842…
iLeasePro Launches CPA Advisor Program for Lease Compliance
iLeasePro has launched its Advisor Program, designed to assist CPA and accounting firms in supporting their clients with ASC 842 lease compliance. This cost-effective initiative provides firms with a streamlined solution to manage the complexities of lease accounting, enabling them to deliver exceptional value to their clients while enhancing their own operational efficiency…
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