FASB Lease Accounting Standard Changes

Jessica Epstein, project manager, Hearst

NEW YORK CITY—The new FASB lease accounting standard changes the way companies organize and report lease information, requiring both public and private firms to report their leased assets, including real estate, on their balance sheets. They must also recognize the assets and liabilities for leases with terms of more than 12 months. Public companies were expected to be compliant by January 2019 and private companies by January 2020.

Implementing this within an organization requires a large amount of planning and coordination across operating and financial teams. In addition to a reliable software solution, timing is incredibly important. Collecting and validating data to become compliant will be an arduous process.