Why Spreadsheets Are Not Ideal for Managing Leases Under ASC 842

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 for their property portfolios. This article explores how property managers can embrace lease management solutions to create a more efficient and client-centric approach to property management.

1. Lack of Consolidation: Spreadsheets work well for individual data sets, but they struggle when it comes to consolidating vast amounts of lease data. Compliance with ASC 842 often involves managing numerous leases, and spreadsheets can quickly become unwieldy and error-prone.
   
   
2. Scalability Challenges: As your business grows, so does your lease portfolio. Spreadsheets may struggle to scale effectively, leading to inefficiencies and complications as you add more leases to your portfolio.
   
   
3. Calculation Accuracy: ASC 842 compliance requires precise calculations, particularly regarding the present value of lease payments and lease liability amortization. Spreadsheets may not consistently deliver the accuracy needed for these calculations, leading to compliance risks.
   
   
4. Human Error: Spreadsheets are susceptible to human errors during data entry and formula creation. Such errors can have significant repercussions, including financial discrepancies and compliance issues.
   
   
5. Security and Control: Lease data is sensitive and confidential. Spreadsheets may lack the necessary security features and controls to protect this data adequately. Compliance standards demand a high level of data integrity and security.
   
   
6. Collaboration Challenges: Collaboration is crucial when managing lease data across an organization. Spreadsheets can hinder effective collaboration, making it challenging for teams to work together seamlessly.
   
   

For these reasons, it’s essential to consider specialized lease accounting software like iLeasePro for ASC 842 compliance. iLeasePro addresses these limitations by offering consolidated lease data management, scalability, calculation accuracy, data security, and collaboration features that spreadsheets simply cannot match.

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