When it comes to FASB ASC 842 implementation, public and private companies do not have a choice. While private companies have time until January 2020 to deal with the challenges of implementing the new accounting standards, some public companies are finding the new implementation issues a pain. And don’t forget, any flaw in the transition will create non-compliance financial penalties.
Here’s why outsourcing is a good solution for the transition to the new accounting standards.
Skills & Expertise: It’s common for companies to feel unprepared for the new accounting standards, which means the chances of a rough start is pretty high. In such cases, it is always better to get external help. Outsourcing to a service provider will ensure that their skills and expertise can help kickstart the implementation process and provide the required momentum.
Surprises: No matter how well prepared a company is, surprises may spring up any time which could cause delays and ultimately, non-compliance. An expert service provider is always equipped to foretell and handle unforeseen surprises.
Expenditure: Your forecast of the resources required for gathering, updating and reporting the lease data to meet the new standards may not be accurate. Additions to existing staff might be required to deal with the bigger tasks. Result is unanticipated budget overruns. Outsourcing the tasks will not only bring in the experts but will also set a more predictable budget.
Tasks outsourcing can help to ease the compliance process. Outsourcing can…
Lease inventory: Help prepare a list of all real estate and non real estate leases like equipment and machinery.
Lease data: Make sure all lease data is gathered and tagged to ensure easy and quick accessibility during the implementation process.
Lease abstraction: Provide accurate and comprehensive lease data to determine the extent of implementation and compliance of the new accounting standards.
Consultation: Help pick the right software that’s best suited for the company’s requirements.
Transfer of data: Help transfer the gathered lease data to a centralized system.
Is your company ready for the FASB changes? If not, call us at 412-567-0010, email firstname.lastname@example.org or visit our website to learn more about our FASB services and how we can help you with FASB compliance.