Lease Accounting Insights
Expert guidance on ASC 842, lease management, and industry best practices
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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…
Top 10 Year-End Lease Accounting Challenges & ASC 842 Solutions
As year-end approaches, lease accounting teams face mounting pressure to prepare accurate financial statements under ASC 842. This blog explores the top 10 challenges controllers and CFOs encounter, from data accuracy and lease modifications to audit-readiness and disclosure requirements…
ASC 842: Impact on Financial Ratios and Leasing Strategies
Explore the impact of ASC 842 on essential financial ratios like debt-to-equity, current ratio, and ROA, which stakeholders use to assess financial health. Understand leasing strategies that can optimize these ratios and present a stronger financial position. Learn how iLeasePro supports compliance and aids in effective lease management…
Quarterly Ratio Analysis: Adjustments Under ASC 842
Quarterly Ratio Impact Analysis (QRIA) offers insights into how ASC 842 affects financial ratios like debt-to-equity and ROA, allowing organizations to identify trends and make strategic adjustments. Learn how QRIA supports proactive financial planning, effective stakeholder communication, and improved leasing decisions, with iLeasePro simplifying compliance and enhancing ratio management…
Lease Payment Automation for ASC 842 Compliance
Accurate recognition of lease payments, especially accruals, is crucial for ASC 842 compliance. Automated payment scheduling eliminates manual adjustments, ensuring entries align with financial statements for year-end accuracy. Discover how automation supports precise reporting, with iLeasePro simplifying payment scheduling and enhancing lease accounting compliance…
Year-End Plan: Overcoming ASC 842 Lease Accounting Challenges
As the fiscal year draws to a close, a structured year-end communication plan becomes essential to address lease accounting challenges under ASC 842. This post outlines a comprehensive approach that includes cross-departmental meetings designed to facilitate timely compliance. By gathering input from accounting, finance, legal, and operations teams, your organization can proactively identify potential issues, implement corrective measures, and ensure accurate reporting…
Streamlining Lease Accounting: API Integration with ERP
API integration between lease accounting software and ERP systems ensures data accuracy, compliance, and operational efficiency for organizations with large lease portfolios. By enabling real-time data flow, it reduces manual errors, streamlines year-end audits, and enhances financial reporting. iLeasePro’s Sage Intacct and QuickBooks Online integrations support these essential functions…
Navigating Tax Implications of ASC 842 in Lease Accounting
ASC 842 has transformed lease accounting by requiring both operating and finance leases to be recorded on the balance sheet, impacting taxable income, deferred tax assets and liabilities, and lease classification. Companies may face higher tax liabilities, new compliance needs, and opportunities to optimize tax strategies. Understanding these changes helps businesses manage tax impacts, financing options, and strategic decisions effectively in a post-ASC 842 landscape.
Enhance Lease Accounting: Speed Up Close and Mitigate Risks
Incorporating lean and agile methodologies into lease accounting workflows reduces time-to-completion and minimizes risks. By creating a continuous improvement cycle, lease accountants can stay on top of compliance, deliver accurate financial reporting, and ensure timely lease payments. This approach keeps your team responsive and ready to adapt to new changes, ultimately enhancing overall performance and efficiency.
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