Lease Accounting

In 2016, the Financial Accounting Standards Board issued its long-awaited standard requiring lessees to recognize all leases with terms greater than 12 months on their balance sheet as lease liabilities with a corresponding right-of-use asset. Accounting Standards Update (ASU) 2016-02, Leases (Topic 842), maintains the dual model for lease accounting, requiring leases to be classified as either operating or finance, similar to existing lease guidance. The ASU requires both qualitative and quantitative disclosures to help investors and other financial statement users better understand the amount, timing and uncertainty of cash flows arising from leasing activities. The standard will have significant implications for entities across all industries, and entities should begin gathering lease data. Disaggregated entities and those with leases possibly embedded in other arrangements should begin evaluating their processes for identifying leases, including system enhancements to capture and monitor leases for initial and potential remeasurement requirements. The effective date is drawing closer. Are you ready?

Request a BKD Speaker

Would you like for a BKD professional to speak to your group about how the proposed lease accounting changes could affect your organization? Fill out the form below, and BKD will contact you with more information.

John Mather

National Industry Partner
Manufacturing & Distribution
314.231.5544

Tondeé Lutterman

National Industry Partner
Not-for-Profit & Government
816.221.6300

Eddie Marmouget

National Industry Partner
Health Care
417.865.8701

Tim Wilson

National Industry Partner
Construction & Real Estate
816.221.6300

Request a BKD Speaker

Do you want a BKD professional to speak to your group about how the proposed lease accounting changes could affect your organization? Fill out the form below, and BKD will contact you with more information.

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