Lease accounting: Anticipating the new standard

Abstract

With the overhaul of global lease accounting standards imminent, corporate real estate (CRE) and other senior executives face a myriad of resultant pre-implementation and post-implementation issues. This paper is intended to address the implications of the new standard from the tenant perspective. In particular, issues arising for companies which lease commercial real estate strategically and follow US Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS) will be discussed. Both the initial transition to the new standard and the ongoing maintenance of reporting lease obligations in the future will require changes to CRE decision making and processes in collaboration and communication with both internal and external stakeholders.