Preparing for IFRS16
As January 2019 rapidly approaches the requirement to comply with new lease accounting standards under AASB 16 is set to cause disruption to those organisations who are ill prepared.
If you have yet to make a start, you urgently need to review your existing lease accounting processes to identify the challenges ahead. Gathering the necessary data and ensuring that it is reliable will be the primary challenge. This may take some considerable time, particularly for larger organisations where information is spread around various entities.
As a first step putting together a project team including real estate, finance and IT departments to reviewing your lease accounting processes is key to identifying the changes that will need to be made.
Key questions for management
- For every entity, which of your contracts contains a lease
- How do you currently capture lease information
- Are your systems capable of capturing sufficient data inputs for reporting
- Are you capable of managing the ongoing assessment process
- What technologies are available that can manage lease data and assist with annual reporting
- Does your leasing strategy need revision.
Starting the implementing your new lease administration system well in advance of the rollout of the new rules will help to make the transition process much easier. Failing to comply could put your company at risk.
In future organisations are likely to pay far greater attention to the way in which leases are structured and the implication of all leases on balance sheet.
If you would like to talk to us at Guardian Global System we can help you meet the new Lease Accounting Standards and manage your ongoing reporting processes.
Guardian Global Systems
P: 02 9209 4231 |