Friday, March 13, 2009

Getting started

Welcome to the lease accounting blog! This is offered by Financial Computer Systems, Inc., which for over 30 years has specialized in providing lease accounting software to corporations throughout the United States and Canada.

Lease accounting is in the midst of a major overhaul, as the Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB) agreed jointly in 2006 to begin a comprehensive review of the regulations for lease accounting (FAS 13 and IAS 17, respectively), with the goal of developing a joint revised standard. Rising unhappiness with the level of off-balance-sheet financing through leasing has been the major driver of this decision, and the boards have agreed to essentially eliminate what are currently known as operating leases, which have no impact on the balance sheet.

Later this month, a discussion paper presenting the boards' intentions will be released for public comment. I'm going to take time both now and in coming days to look at what has been decided so far, what is still undecided, and what the implications are for lessees (and to a certain extent for lessors, including sublessors).

Financial Computer Systems markets both software and services to provide complete lessee accounting for both capital and operating leases. We have been specialists in FAS-13 compliance ever since FAS-13 was issued in 1976 (we actually developed our first version of software in 1975 to meet the predecessor regulation, ASR-147). We'll talk more about how our EZ13 software can help with lease accounting on this blog as well.

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