Companies Need to React Now to Proposed FASB Lease Account Rules Changes
FASB lease account rules changes are definitely coming. Jones Lang LaSalle's Vivian Mumaw discusses what companies need to do today to ensure they are ready for the changes.
Vivian Mumaw, Global Leader, Lease Administration, Jones Lang LaSalle (6/20/2011)
In the first quarter of 2011, FASB reacted to an outpouring of comments on its proposed lease account rules changes. Though the organization listened and has pulled back its original highly rigorous pronouncement, these changes are definitely coming. In order to meet the requirements of these eventual changes, companies need to sort the required systems and resources before 2015. Companies need to start implementing now as it takes up to 18 months to prepare a company's real estate operations to adapt to these changes.
Jones Lang LaSalle's Vivian Mumaw discusses what companies need to do today to ensure they are ready for the changes. They need to implement new systems, new resources, and training. To accomplish this, companies must select a trusted lease administration partner that can develop a comprehensive solution. To implement a new technology platform that incorporates hundreds to thousands of leases and data points, companies must start today to ensure they have enough time to select the right partner and create a robust, flawless system. Corporate Real Estate executives will also need to work more closely with other business areas such as human resources, technology, and treasury.
The upcoming lease accounting changes are yet another business dynamic that is bringing the real estate function and the Corporate Real Estate Executive front and center within the corporation. The level of cross-functional skills and business savvy required to be successful in the CRE role will continue to increase as the function becomes more all-encompassing and complex.
Visit www.leaseaccountingchanges.com for more information, including the most recent updates on the FASB guidelines, a preparedness checklist to gauge your company's readiness, and a Lease Accounting Calculator to estimate the impact of the changes to your bottom line.