The new lease accounting guidance presents an opportunity to proactively implement new processes and policies while simultaneously taking inventory of your Company’s lease populations, and assess the impact on future financial reporting.
Discount rates need to be captured when implementing the new lease accounting standard. The guidance for non-public companies is more lenient than that for public companies but requires significant consideration as the date approaches.
The Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update 2018-11 Leases – Targeted Improvements (“ASU 2018-11”). The most significant impact is relief in the comparative reporting requirements for initial adoption.
If you are a business owner or CFO, be aware of the new lease accounting standard. If your leases mature after Jan. 1, 2019, your bottom line could be affected unless you act now.
With major changes coming down the road in the accounting for leases and revenue, now is the time to start planning for their impact on your business.