Lease Accounting Insights
Expert guidance on ASC 842, lease management, and industry best practices
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Critical Date Notifications: Key for Lease Compliance & Risk
In lease management, critical date notification refers to the process that alerts the involved parties about important dates and deadlines related to a lease agreement. These notifications help ensure that both the landlord and the tenant are aware of upcoming crucial dates, such as lease expiration, rent increases, option exercise periods, renewal deadlines, or any…
ASC 842 Audit: Guide to Compliance Evaluation
When an auditor evaluates a company’s implementation of ASC 842 lease accounting, they generally follow a series of steps to ensure compliance when performing a lease accounting audit. These steps may vary slightly depending on the specific circumstances of the company and the auditor’s approach. However, a general process is as follows: Understand the entity’s…
ASC 842: Applying the Right Lease Classification
The ASC 842, or Accounting Standards Codification Topic 842, is the accounting standard for lease accounting in the United States. It was issued by the Financial Accounting Standards Board (FASB) to improve transparency and comparability of financial statements by recognizing lease assets and liabilities on the balance sheet. Under ASC 842 lease classification, leases are…
Top 10 Lease Accounting Internal Controls for Success
Implementing new processes and internal controls is crucial for ensuring accurate and timely lease accounting under the new standards. Here are some key processes and controls to consider: Lease identification and inventory: Establish a process to identify and track all lease agreements, including embedded leases within service contracts or other arrangements. Maintain a comprehensive lease…
Unlocking Cost Savings with Cloud-Based Lease Management
The property management industry is continuously evolving, driven by advancements in technology and the ever-changing needs of property owners and tenants. One significant development in recent years is the increasing adoption of lease management solutions. These solutions enable property managers to streamline their operations, offer enhanced services to their clients, and ultimately drive greater success…
Maximizing Property Management Efficiency with a Lease Repository
A centralized lease data repository is critical for a property manager for several reasons: Efficiency: A centralized system consolidates all lease information in one location, making it easier for property managers to access and manage data. This saves time and effort, as they no longer need to search through multiple sources or physical files. Accuracy:…
Increasing Revenue Growth: CPA Firms and ASC 842 Lease Solutions
CPA firms can increase their Monthly Recurring Revenue (MRR) by providing ASC 842 Lease Accounting solutions for private company clients. By offering expert guidance and services related to the implementation and ongoing management of ASC 842, CPA firms can create new revenue streams and foster long-term client relationships. Here are some strategies for CPA firms…
The Future of Property Management: Embracing Lease Solutions
The property management industry is continuously evolving, driven by advancements in technology and the ever-changing needs of property owners and tenants. One significant development in recent years is the increasing adoption of lease management solutions. These solutions enable property managers to streamline their operations, offer enhanced services to their clients, and ultimately drive greater success…
GASB 96: Understanding Subscription-Based IT Arrangements
GASB Statement No. 96, Subscription-Based Information Technology Arrangements (SBITAs), was issued in May 2020. The statement establishes guidelines for state and local governments for accounting and financial reporting of subscription-based information technology arrangements (SBITAs), which are essentially cloud computing and other IT service arrangements. GASB 96 is effective for fiscal years beginning after June 15,…
Navigating the Challenges of Implementing AI in Lease Accounting
While AI offers numerous benefits for lease accounting, there are also potential risks and challenges that organizations should consider when implementing AI-driven solutions. Some of the risks associated with using AI in lease accounting include: Data privacy and security: AI systems require large amounts of data to function effectively. Ensuring the privacy and security of…
Revolutionizing Lease Accounting: AI's Impact
AI will likely have a significant impact on lease accounting in several ways, as it has the potential to enhance efficiency, accuracy, and compliance. Some possible effects of AI on lease accounting include: Automation of data entry and analysis: AI can process large volumes of lease agreements and extract relevant data points, such as lease…
8 Risks of Using Spreadsheets for ASC 842 Lease Accounting
While spreadsheets are widely used for various tasks in accounting, they may not be the ideal tool for complying with the ASC 842 lease accounting standard. Checkout our video on this topic. The ASC 842 standard, which was introduced by the Financial Accounting Standards Board (FASB), aims to increase transparency and comparability of financial statements…
Cloud Lease Accounting & Management Benefits for Property Managers
There are several benefits of a cloud lease accounting and lease management solution for property managers, including: Improved accuracy: Cloud lease accounting and lease management solutions automate the lease accounting process, reducing the potential for human error. This results in more accurate financial reporting and better decision-making. Centralized data: Cloud solutions provide a centralized location…
Top 5 Ways to Streamline Workflows with Lease Accounting
A lease accounting solution can help minimize workflow in several ways: Automated data entry: A lease accounting solution can automate data entry by importing data directly from lease contracts, eliminating the need for manual data entry and reducing the potential for errors. Centralized lease management: With a lease accounting solution, all lease information can be…
Benefits of a Centralized Contract Management Solution
Centralized contract management solutions in the cloud offer several benefits to organizations, including: Accessibility: With a cloud-based solution, contract information is accessible from anywhere and at any time, as long as there is an internet connection. This enables organizations to manage contracts remotely and provides flexibility to access important information when needed. Efficiency: A centralized…
The Impact of Non-Compliance with ASC 842 Lease Accounting
Non-compliance with the ASC 842 lease accounting standard can have several negative impacts on a company, including the following: Financial statement misrepresentation: Failure to comply with ASC 842 may result in inaccurate representation of a company’s financial position. The balance sheet might not properly reflect the company’s lease liabilities and right-of-use assets, leading to misleading…
ASC 842: Understanding the Relevant Borrowing Rate
The Accounting Standards Codification (ASC) 842 provides guidelines for lease accounting in the United States. One of the key components of ASC 842 is the determination of the lease liability and lease asset, which is based on the present value of lease payments using the relevant borrowing rate. In this blog, we will discuss the…
Introduction to Lease Accounting: A Complete Overview
Lease accounting is a critical aspect of financial reporting that helps companies manage their leases effectively. It is a method of accounting for the rights and obligations associated with the use of leased assets. Lease accounting is an important topic for businesses, as it can have a significant impact on financial statements and other reporting…
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