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ASC Topic 842 Leases

What’s New with ASC 842 Lease Audit?

The new lease accounting standard (ASC 842) brings most leases onto the balance sheet and introduces two transition implementation methods, as well as various practical expedients and policy elections that a company should consider. Companies will need to assess potential impact on debt covenants and income tax implications.

When Will It Impact You?

The new standard is effective for private companies with calendar year-ends on or after January 1, 2020.

Key Accounting and Operational Challenges:

  • Identify service agreements which may include a lease component (i.e., embedded leases)
  • Determine the lease term (renewals and early-termination options, etc.) and discount rates
  • Accounting for lease and non-lease components and lease payments (fixed and variable)
  • Accounting for new or modified existing leases subsequent to the adoption date
  • Adapt to new guidance for build-to-suit arrangements and sale-leaseback transactions
  • Examine availability of internal resources

How Can EisnerAmper Help

  • Transitioning from ASC 840 to ASC 842 on the adoption date (transition)
  • Accounting for new or modified existing leases subsequent to the adoption date
  • Preparing the new lease disclosures
  • Establishing controls around adoption of ASC 842
  • Income tax impact on the adoption date

Why EisnerAmper?

  • Dedicated team of professionals focused on ASC 842
  • Significant ASC 842 experience – Successfully helped public and private companies plan and implement ASC 842
  • Thought leadership – Speaking engagements and written articles on ASC 842