Time Is on Your Side Making the Most of the Delay in Lease-Accounting Changes

摘要

Certain private companies,nonprofits and tax-exempt organizations that lease equipment have been given an important advantage in implementing new accounting rules-more time.The Financial Accounting Standards Board(FASB)recently announced that the effective date of the new lease accounting standard,Accounting Standards Codification Topic 842(ASC 842),for private companies and nonprofits has been delayed by one year,with implementation beginning after Dec.15,2020.The delay will allow smaller organizations to get their accounting processes in place while they continue to enjoy the advantages of leasing equipment.Since ASC 842 went into effect in December 2018 for public companies,FASB members have expressed that companies with limited resources can learn from the implementation performed by large public companies that possess more staffing and resources.Having additional time to get through at least one annual audit cycle and regulatory cycle should help smaller reporting companies and private companies increase the quality of their implementation.