How can lease accounting and reporting improve the financial health of your commercial leasing business?

1 Understand the lease standards

The first step to improve your lease accounting and reporting is to understand the lease standards that apply to your business. Depending on your jurisdiction, you may need to follow different rules for classifying, measuring, and disclosing your lease contracts. For example, in the US, you need to comply with the FASB ASC 842 standard, while in the EU, you need to follow the IFRS 16 standard. These standards require you to recognize most of your leases on your balance sheet as assets and liabilities, and to provide detailed information about your lease terms, payments, and assumptions. You should familiarize yourself with the lease standards that affect your business and ensure that you have the appropriate systems and processes to implement them.

2 Use lease accounting software

The next step to improve your lease accounting and reporting is to use lease accounting software that can automate and simplify your tasks. Lease accounting software can help you collect, store, and analyze your lease data, generate accurate and timely financial statements, and monitor your lease performance and compliance. Lease accounting software can also help you integrate your lease data with other systems, such as ERP, CRM, or BI, to create a holistic view of your business. By using lease accounting software, you can save time and money, reduce errors and risks, and enhance your decision-making and reporting capabilities.

3 Optimize your lease portfolio

The third step to improve your lease accounting and reporting is to optimize your lease portfolio to align with your business goals and strategy. You can use lease accounting software to perform various analyses on your lease portfolio, such as lease vs buy, renewal vs termination, or consolidation vs expansion. You can also use lease accounting software to identify and manage your lease risks, such as interest rate fluctuations, currency exchange rates, or impairment losses. By optimizing your lease portfolio, you can improve your cash flow, profitability, and return on investment, and adjust your lease strategy to changing market conditions and customer demands.

4 Communicate your lease value

The fourth step to improve your lease accounting and reporting is to communicate your lease value to your internal and external stakeholders. You can use lease accounting software to create and share customized reports and dashboards that highlight your lease performance, compliance, and impact. You can also use lease accounting software to provide transparent and consistent information to your auditors, regulators, investors, lenders, and customers. By communicating your lease value, you can build trust and credibility, demonstrate your competitive advantage, and attract and retain more business.

5 Stay updated and informed

The fifth step to improve your lease accounting and reporting is to stay updated and informed about the latest trends and developments in the commercial leasing industry. You can use lease accounting software to access relevant and reliable sources of information, such as news, blogs, podcasts, webinars, or white papers. You can also use lease accounting software to join and participate in online communities and networks of lease professionals, experts, and peers. By staying updated and informed, you can keep up with the best practices, innovations, and opportunities in the commercial leasing industry, and adapt your lease accounting and reporting accordingly.

6 Seek professional advice

The sixth and final step to improve your lease accounting and reporting is to seek professional advice from qualified and experienced lease consultants, accountants, or lawyers. They can help you review and improve your lease accounting and reporting policies, procedures, and systems, and provide you with guidance and support on complex or challenging lease issues. They can also help you train and educate your staff on lease accounting and reporting standards, software, and skills. By seeking professional advice, you can benefit from their expertise, insights, and recommendations, and ensure that your lease accounting and reporting are compliant, accurate, and efficient.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?