The Financial Accounting Standards Board (FASB) voted yesterday to approve the long awaited and debated lease accounting overhaul. This new standard will significantly affect the balance sheets of both public and private companies by requiring the inclusion of significant lease obligations and related intangible assets that have only been disclosed in footnotes in the past.
The final standards are expected to be issued in 2016. It will not likely affect public companies until 2019 and private businesses until 2020. The accounting rule would affect any company that pays to lease real estate property, office equipment, aircrafts and other items. According to the FASB Chairman, Russell Golden, he believes the new standard will offer more transparency and provide a more accurate picture of financial obligations to investors and lenders.
To read more about the FASB ruling please follow this link to the news release on FASB's website
This proposal has been in the works for years now, and our teams will continue to work with our clients in assessing the impact, timing and transition plan for adoption for this controversial standard.
Please call 770-396-2200 to speak with a Bennett Thrasher professional to inquire about how this may impact your organization.
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