How to Implement New Accounting Standards Affecting Leases
The Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB) have released new guidance that will affect accounting for leases. The changes, which were proposed in 2013, will impact your current lease inventory procedures on leases ranging from real estate to construction equipment and will touch both public and private businesses. Here are some of the changes you will likely see when they are adopted:
- Balance sheet presentation will be mandatory for lessees for operating leases.
- Software solutions may be needed to account for leases on your balance sheet.
- The lease classification process and internal controls will need to evolve.
- There will be an increase in disclosure requirements.
How we can help
Although the full implementation won’t begin for several years, you will want to start educating yourself on how the new guidance will affect your lease inventory and your business model. You can read about the details in this Journal of Accountancy article. As you digest the material and think about future preparations, our Custom Accounting Solutions Team (CAST) professionals are prepared to provide services for public, private, and nonprofit entities. We offer tailored accounting solutions to help you transition to the new guidance requirements.