Markets and auditors are reviewing the first reporting cycle since adoption of the new FASB ASC 842 accounting model
ATLANTA, May 09, 2019 (GLOBE NEWSWIRE) -- Public companies complying with the FASB ASC 842 lease accounting standard have started to report their first disclosures for the fiscal year under the new model. Now, with all leases identified on the balance sheet, eyes are on accounting teams as they work to resolve unexpected reporting challenges and smooth out their process heading into the second fiscal quarter.
As the year progresses, organizations should expect more questions from auditors and shareholders. This is because 2019 is the first year companies are reporting under the new guidelines, so they must determine how their reports should look without the benefit of the past. "So far, accounting teams with an automated system are better positioned for compliance with the new lease accounting standards than those without," said Jared Schwantz, Associate Product Manager at PowerPlan. Automated systems help organizations avoid time-consuming errors by providing audit trails and version tracking.
"If an organization failed to hit the nail on the head during the audit of its Q1 report, thankfully there are still three more opportunities this year to optimize that process," added Schwantz. In fact, a survey by Deloittehas found that 23.9 percent of organizations are planning to spend even more time and effort on lease implementation now that they have filed Q1 2019 earnings. Though accounting operations teams have time to refine their lease accounting process, it is crucial that they solidify their process this year. All 2020 reports will be based off this year's data, so accuracy is of utmost importance.
To learn best practices for transitioning and continuing adoption with the new standards, read PowerPlan's best practice article, 3 Mistakes to Avoid in Your Lease Compliance Plan: http://bit.ly/2VQmjNv.
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