NEW LEASE ACCOUNTING STANDARDS -...

NEW LEASE ACCOUNTING STANDARDSEXPERT PANEL WEBINAR

New Lease Accounting Standards - Expert Panel Webinar

Meet Our Expert Panelists

BruceConway

MarkKoppersmith

ScottDunnihoo

Colleen Tigges

Vice PresidentOperations

DirectorProduct Management

DirectorCustomer Service

DirectorSolutions Consulting


Question #1

What type of General Ledger entries need to be made?


General Ledger Updates

Commencement Midterm Event End of Term

Monthly Entries


Question #2

What are the economic advantages of equipment lease

versus ownership?


What are the Economic Benefits of Leasing?

Lease Buy


Question #3

Has the SEC released any guidance related to the implications of the 5 year table (Selected Financial Data) in an entity’s 10-K upon adoption in 2019?


The Five Year Table

Example


Question #4

What should we set aside from a resource and budget perspective to

handle this project?


Resources and Budget

Implementation On-Going

ProjectResources

DataCollection

ProgramResources

Software/Technology


Question #5

What are the best software options for lease accounting?


What Software Options are Available?

Real EstateAdministration

LeaseAccounting

IT, Fleet AssetManagement

ERP(Customize)

SoftwareOptions

• Construction• Space//Facility Planning• Building Maintenance• Lease Administration

• Asset Tracking• Maintenance & Repair• Lease Administration

• Fixed Asset Accounting• General Ledger• Procurement

• Real Estate, IT, Fleet, etc.• Asset Level Sub-Ledger• Generates Debits/Credits


Question #6

How do I get an inventory of what leases I have? What types of data

do I need to comply?


What Do We Lease?

Office Space

Retail Store

Warehouse

Trucks

Autos & Vans

Ships & Barges

Forklift & MHE

Manufacturing

Medical Tech

Computers

Servers/Storage

Copiers


Where to Find the Data?

Lessor Systems

Accounts Payable

Real Estate

Asset Management

Contracts Management

Tracking Spreadsheets


Question #7

What are the key challenges with leases for fleets, IT and other types of equipment (versus real estate)?


Scale is One Example of a Difference

BudgetOwners Stakeholders Countries Assets Leases

Fleet, IT &EquipmentLeases

Stakeholders Countries Facilities Leases

RealEstate

10s 10s 100s 100s

1000s 10s 10,000s 1000s100s


Question #8

Who outside of the accounting organization should be involved in

the project?


Who Needs to Be Involved?

Lease AccountingProject Team

TechnicalAccounting

FinancialReporting

LeaseAdministration

CorporateTreasury

InformationTechnology

Procurement/Supply Chain

CorporateTax

Real Estate Fleet Logistics Data Center


Question #9

Do we need a sub-ledger for leasing data? How are companies

approaching this?


Lease Accounting Sub-Ledger

General Ledger

PayrollLedger

AccountsPayableSubLedger

AccountsReceivableSubLedger

FixedAsset

SubLedger

InventorySubLeger

InvestmentsSubLeger

LeaseAccountingSubLeger


Question #10

What are the biggest unknowns or risks, that we should be aware of?


Biggest Risks and Unknowns

Asset Level Financials

Resources & Expertise

SystemsReadiness

Policies & Controls

IncomeTaxes

DebtCovenants

EmbeddedLeases

MidtermEvents

LeaseAccountingTop Risks


Question #11

What new policies and controls need to be in place?


New Policies and Controls

Lease vsBuy Analysis

What Should &Should Not Be Leased

Single EnterpriseRepository

Verify Accuracy of Data

Asset LevelTracking

Authorization to Lease


Question #12

For IT leases (i.e., printers/copiers) in Europe and Asia, how are people treating service contracts that

charge a cost per copy instead of a “lease”? Do these agreements fall into the scope of the new standard?


Printers & Copiers (Variable Pricing)

Is there an identified asset?

Contract is or contains a lease

ContractDoes NotContainA Lease

Does customer have the right to obtain substantially all of the economic benefits from use of

the identified asset?

Does customer have the right to direct the use of the identified asset?

Yes

Yes

Yes

No

No

No


Question #13

What types of internal and external Initial Direct Costs should be

included as part of the Right of Use Asset?


Initial Direct Costs

Typical Initial Direct Costs

Include Exclude

• Commissions• Payments made to an existing tenant to incentivize that tenant to terminate the lease

• Legal fees• Costs of evaluating lessee’s financial condition• Costs of negotiating lease terms and conditions• Overheads


Question #14

What business processes will be impacted by the new lease accounting standards?


Which Business Processes are Impacted?

Quarterly & AnnualReporting

MonthlyClose IT & Data

CenterManagement

Real EstateManagement

Invoicing& Payments

LeaseVersusBuy

Logistics& WarehouseManagement

BudgetPlanning

TaxPlanning

Sourcing &Procurement


More Answers

Download our Lease Accounting Handbookwww.leaseaccelerator.com/fasb-‐handbook

• Who to put on the project team• What data to collect• What steps to take for implementation• How to handle international leases


Closing Remarks

• Webinar Replay will be Later in the Week

• Slide Downloads will be Available

Email us at: [email protected]

Or Visit: www.leaseaccelerator.com


Thank You

NEW LEASE ACCOUNTING STANDARDS -...

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