The Fast-Approaching FASB Lease Accounting Changes May Apply to ALL Long-Term Leases, Not Just Real Estate

With FASB rule changes on the horizon, there remains a great deal of uncertainly about what the changes will entail. One thing is certain, however. Real estate professionals have a choice:  Wait for the changes and react to them. Or seize the opportunity to gain visibility and become part of the strategic finance team. Will you be ready well in advance for the changes?

• Have you captured and validated all required information for real estate leases and non-real estate leases?
• Do you have resources and processes in place to handle the staggering amount of work the new policies will require now and in the future?
   

Read the Chain Store Age article by Virtual Premise President and COO, Andy Thomas

You Can't Avoid FASB Changes Forever
Two things you can do now to prepare for the financial impact to your balance sheets

The proposed FASB lease accounting changes may not only affect real estate leases. These impending policy revisions may apply to long-term non-real estate leases as well including, for example, fleets of automobiles, tractor trailers, forklifts, manufacturing equipment, office equipment like printers and copiers, and the list goes on and on. And don't forget the maintenance agreements for all of this equipment. While we believe the changes will involve a tremendous amount of work for the real estate team, it's also an opportunity for you to finally move from reactive firefighters to members of the strategic team. With the reporting of leases moving from the footnotes to balance sheets, real estate professionals at last have an opportunity to become part of the team that sets their company's long-term leasing strategy - and indeed business strategy.

Savvy real estate professionals will drive the new lease accounting processes, and offer strategic recommendations to their company executive team - assuming a more visible, strategic role in the financial management of their companies.

But you have to be ready. And that means making sure your lease management house is in order - before the changes hit. Virtual Premise customers are doing just that. For example, one of the world's largest floor covering manufacturers and distributors is now using the Virtual Premise solution to manage all their leases - real estate and equipment. Virtual Premise gives them a single source of information for their complete inventory of leases.

While equipment leases are not generally as large or complex as typical real estate leases, expert skills are still required to ensure the right information is abstracted and the data validated. The VP Lease Services Team supported this customer's requirements by consolidating and auditing information from over ten different databases - more than 5,000 leases were abstracted in less than four months.

Let Virtual Premise help you proactively prepare for the prospective new policies. As the expert in SaaS-based real estate information management solutions, Virtual Premise utilizes industry best practices to help you manage the data required for compliance with the anticipated policies.

Contact Jim Dooley today to learn more about the anticipated lease accounting changes at 404-969-1278 or jdooley@virtualpremise.com