Several Ways Computer Software Simplifies Lease Accounting
Accounting is a complicated service to provide. When it comes to expediting any process, we must first think about why there has been a need to develop computing software for specific use in lease accounting. The reason has been that accounting standards have necessitated the greater need for transparency concerning leases. It is then software that can guide an accounts department to the correct recording and compliance of the financial data that relates to leases.
For those looking to introduce lease accounting software into their business, or to update it, then it is worth considering EZLease for simplified lease accounting. This clever piece of software will make things easier in terms of recording and managing lease data, whilst pleasing the regulatory bodies concerning the accountancy standards that relate to greater transparency.
Lease accounting software will provide the calculations and the functionality that is required for companies to comply with the various financial reporting standards in respect of lease contracts. These are standards that cannot be ignored if we are to continue to operate as a lease management company. It may be all of our business or a part of it, but we will still need to account for the leases all the same. It is about making it clear to those looking at our accounts to what extent leases form part of our business. This will be investors and shareholders wanting to know so that they can make the best investment decisions possible. Companies dealing with leases owe them that transparency. At the same time, businesses are entitled to software that can help with the lease accounting and reporting process.
Recording Lease Data
These relatively new financial accounting packages are designed to automate the lease accounting process. This is in respect of the new accounting standards ASC 842, IFRS 16, GASB 87, and SFFAS 54. Companies have no choice but to comply with these accounting standards to stay within the regulations, and so accounts departments cannot ignore them. Instead, they must embrace them with or without software to help. It is the software that will make this process easier and less painful, though. When thousands of leases are being transacted it can prove something of a headache without reliable software to act as a guide.
So, know about accounting standards and capital leases and how they are recorded. Then look to the software to make it an easier and more effective process.
Automation of the Record-to-Report Process
It is this automated process of recording the data and then having it available to report that will remove the hassle of constructing accounts later that will be vital to be ready for an audit. It is this audit that will check if there has been compliance with the above-mentioned accounting standards. It is a nervous time for accounts departments and software will take away much of the anxiety.
To take the hard work out of lease accounting, which is a potentially time-intensive exercise, is a money-saving one. Therefore, purchasing this kind of software can be considered an investment, even if it is not classed as a fixed or current asset in the balance sheet. It will be an expense that, however, exists on the profit and loss account that will be one worth having because of it lowering the wages bill that will be close to it in the list of expenses.
Management of Data
When a company deals with sometimes thousands of leases, data needs to be better recorded and more accessible than just being in several handwritten ledgers or computer folders to which only the accounts department staff have access. This kind of accounting system will no longer satisfy the demands of the medium-sized lease company, let alone a larger one. Instead, with the right software, what has been entered within a lease accounting software package can be viewed by all those managers with a password to gain access. They might be managing the budgets of several departments. When it comes to them managing leases, they will welcome the software that records them accurately and clearly and that complies with the accounting standards everyone has to take notice of.
Lease management software will help to eliminate some of the complexities that exist with managing many real estate leases. This is because the software will keep a check on every leasing agreement that exists for a company within what can be quite a diverse portfolio. So, you can imagine the daunting task without such software, if you have not already come across it. This might explain your reason for finding this article. It is advisable to have software when it comes to dealing with lease accounting, in particular. Leases are complex in themselves and all need to be accounted for in their way. That is with ever-greater transparency when it comes to balance sheets and the audit stage for a lease management company.
So, many ways that can help if lease accounting is your business and financial accounting standards are your worry.