FASB Leases (Topic 842) at a glance: A brief overview
The Financial Accounting Standards Board (FASB) have finally published their new lease accounting standard. After the decade long deliberation process, both the board now had a final version, marking the biggest ever change to lease accounting.
This new standard aims to provide greater transparency and a more accurate reflection of the financial liabilities and commitments that arise from leasing on fiscal documents. Under the current standard, operating leases are not required to recognise an asset or liability on the balance sheet; this has led to 85% of lease commitments worldwide being treated as “off-balance sheet”. Under this new standard, an estimated $2.8 trillion worth of lease commitments will be brought onto balance sheet and businesses will need to gain a greater understanding of how they lease.
To help business leaders gain a greater understanding of what the new standard entails and how it will affect their operations, our leasing experts have put together this concise overview of the new FASB Leases Topic 842.
This short and information packed document is only 2 pages and filled with everything you need to know to ensure your organisation is prepared and optimised to transition to the new accounting standard.
This is the biggest change to lease accounting ever and leading accounting firms have warned that businesses will need to begin implementing their transition plans sooner rather than later. Innervision have followed the accounting standards since they were first discussed over a decade ago. Our leasing experts have are perfectly placed to help businesses understand what is required of them and how best they can make the most of the transition and remain cost effective.
If you would like to talk to an expert about the new FASB lease accounting standard and find out how best you can run comparative reports and gather data on your existing leases, be sure to get in touch with one of our leasing experts.
Share this article: