Sequentra - Corporate Real Estate Management Tool
Sequentra provides the tools and support services to manage through the upcoming changes

FASB and IASB Lease Accounting Changes

Sequentra® is ready to provide your business with sound, secure, and accurate tracking of real estate capital lease requirements, today and in light of the upcoming FASB and IASB regulatory changes. These standards apply to land, buildings, and leases including short term and long-term obligations.

Our global Lease Administration, Portfolio Strategy, and Sequentra product development teams, have been monitoring the accounting Boards' activity since 2009 by reviewing all joint Board updates and consulting with international accounting firms. While our Sequentra® global portfolio tracking system has always been FASB compliant, we have added additional functionality that makes our system easier to calculate your remaining obligations regardless of whether a client's portfolio contains right-of-use or straight-line capital leases.

All clients should begin preparing now for the pending regulations. Our Portfolio Strategy and Lease Administration teams work with clients to analyze their portfolio and offer both short-term tactical and long-term strategic opportunities. We utilize Sequentra as the system of choice to track client leases in a SOX-compliant manner and strategize in compliance with current and future regulations. We believe the best ways our customers can prepare for the upcoming changes are to proactively begin:

Capturing essential data for all leases:

  • This includes all critical data, such as lease commencement and expiration dates, option notification dates and terms, rent and income escalations, additional rent contingencies, security deposit and tenant allowance information, and any provided landlord incentives (including free rent and tenant improvements)
  • Utilizing a system capable of producing the necessary calculations and able to integrate with your existing enterprise resource planning (ERP) systems.
  • Providing access to data and reporting that supports your company's response and readiness for the impact of the new rules. While a client's financial component of an ERP system will provide all necessary FASB / IASB reporting, it is important that the real estate system, as part of your total ERP package, be able to capture the essential data for historical and forecasting purposes. Sequentra® captures the details required for reliable executive support system reporting and effective company decision making.

Analyzing the impact of a new standard.

  • The means analyzing the value of your lease obligations on a capitalized basis by calculating the total cash payments of your leases, any anticipatory changes in the total lease term length, the imputed interest expense (as derived from your company's costs of capital), and amortizing the costs over the anticipated length of the lease.
  • We can help show you the impacts the aggregated effects would have on your company's financial ratios and how to help mitigate negative outcomes.

Sequentra® is ready to provide your business with sound, secure, and accurate tracking of real estate capital lease requirements, with full support of the new FASB and IASB regulatory changes.

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